Min Heejin Exercises Her Put Option

note: this is based on the shareholder's agreement Hybe terminated which she insists is still valid.

sourceL https://n.news.naver.com/article/001/0015046601?sid=103

It has been confirmed that former ADOR CEO Min Hee-jin recently notified HYBE of her intention to exercise a put option (stock purchase request right) on ADOR shares.

Since this put option is one of the core elements of the shareholder agreement that former CEO Min made with HYBE, attention is focused on why she decided to exercise it so suddenly. ADOR’s Vice President Shin and former Director Kim, both considered close associates of former CEO Min, also notified HYBE on the same day that they would exercise their put options. On the 5th of this month, Min released a statement saying, "Among the many rumors, I have heard that stories are spreading, especially in the investment industry, that I 'decided to receive investment from someone' and 'decided to sign a contract with someone,'" adding, "I have also heard that a specific company name is mentioned, but this is completely untrue." However, it is likely that former CEO Min may face a legal battle before actually obtaining a substantial sum by exercising the put option. In July, HYBE notified former CEO Min of the termination of the shareholder contract, which was the basis for the put option, citing reasons such as damage to trust, but former CEO Min did not acknowledge this, asserting that the contract is still valid.

According to the music industry on the 14th, former CEO Min notified HYBE of her decision to exercise the put option early this month.

According to the shareholder agreement established by former CEO Min, if she exercises the put option, she can receive from HYBE an amount equal to 75% of her stake in ADOR, calculated by multiplying ADOR’s average operating profit for the previous two years by 13 times.

As former CEO Min notified of the exercise early this month, the base years for calculating the put option are 2022-2023. ADOR’s operating profit during this period was -4 billion won (approximately -$3 million) in 2022 and 33.5 billion won (approximately $25 million) in 2023. In 2022, ADOR recorded a deficit, likely due to NewJeans, ADOR's only artist, debuting in July of that year.

If former CEO Min had delayed exercising the put option until next year, the calculation period would have shifted to 2023-2024, potentially increasing the amount she could receive.

According to ADOR’s audit report released in April this year, former CEO Min owns 573,160 shares (18%) of ADOR stock. Based on this, it is understood that former CEO Min could receive close to 26 billion won (approximately $19.5 million).

On the 29th of last month, former CEO Min appeared on popular music critic Kim Young-dae’s YouTube channel and stated, "I have never tried to leave (the company) as HYBE claims," adding, "I keep suffering from strange accusations and false allegations."

The previous day, NewJeans sent a certified letter to their agency ADOR, stating, "If the corrective action demands are not accepted within 14 days, we will terminate our exclusive contract."