ADOR CEO Min Hee Jin reportedly demanded from HYBE the sole authority to terminate NewJeans’ exclusive contract with the label. The ADOR side clarified this, stating that it was “for the independent operation of the label.”
According to industry sources on May 2nd, Min’s legal team sent a revision of the shareholders’ agreement to HYBE in February of this year. This came after a deadlock between the two sides at the end of last year over the putback option multiplier and its application to the additional 5% stake.
In general, major entertainment companies require board approval for exclusive contracts. This is because the exclusive contract rights of artists are considered a core asset necessary for the operation of the company.
If Min’s demand is accepted, NewJeans will be able to terminate their exclusive contract without going through the ADOR board of directors or HYBE’s involvement. According to the current shareholders’ agreement, it is reported that the approval of the board of directors is required to terminate the exclusive contract of an artist, just like other general entertainment companies.
HYBE reportedly sent a reply rejecting this proposal.
Currently, the ADOR board of directors consists of three members: Min herself, her close aide Shin, and director Kim, who all have voting rights. However, under the current structure, HYBE, which owns 80% of ADOR’s shares, can convene an extraordinary general meeting of shareholders to replace the ADOR board of directors and prevent the departure of its artists.
However, if Min is given the sole authority to terminate exclusive contracts, HYBE will have no way to prevent the departure of its artists, in this case, NewJeans.
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