FULL TRANSCRIPT OF HYBE RESPONSE TO MIN HEE-JIN'S ALLEGATIONS

Here is the full transcript and I will post a TLDR version after this one.

1. Regarding the assertion that the management takeover was merely a joke and part of a private conversation:

There is documented evidence including transcripts and work journals that show discussions about the takeover have been ongoing for months. When such conversations continue over an extended period and involve third parties preparing to take action, it transcends the realm of private discussion into concrete planning and execution.

Furthermore, the vice-president, whom CEO Min was conversing with, is a certified public accountant with extensive knowledge of corporate operations. This individual played a significant role in HYBE's public listing and various mergers and acquisitions. As a principal executive at ADOR, they have access to all the company’s financial data. The vice-president noted in their work journal that CEO Min’s statements were aimed at finding a way to ‘ultimately escape.’

It's implausible to dismiss all these details as merely humorous. The unearthing of documents that outline strategies like calculating potential earnings from put options, timing planned actions, preparing a lawsuit for rights infringement, discussing involvement with external investors, and initiating media campaigns cannot be lightly regarded as jokes. Additionally, there is a recorded statement by the vice-president indicating that their discussions should be considered ‘private conversations.’

2. About the complaint that the financial compensation was too low: 

CEO Min's salary is ₩2.00 billion KRW (around $1.46 million USD), which includes a performance incentive for 2023, separate from her regular pay and long-term incentives. This makes her the top earner at HYBE headquarters and its subsidiaries in Korea.

HYBE also gave her a hefty amount in stock options, which most people can't even imagine. Still, CEO Min reached a deadlock in negotiations by asking for more than what the company could afford. We think she's trying to make a case for running things on his own.

3. On the claim that an audit was rushed without responding to the whistleblowing email:

We sent a detailed six-page response at 10:01 AM on April 22nd, which CEO Min looked at by noon that day. However, she kept saying at the press conference and in her statement that she got ‘no answer.’

We only started the audit after months of spotting attempts to take over management and finding out that sensitive business info had leaked. It just doesn’t make sense to expect us to announce an audit timetable in such a serious situation.

4. About the claim that there was no guidance on returning property with company information: 

We visited CEO Min's work studio and home at 10 AM KST on April 22 to collect company property as part of our audit. We tried reaching her several times by email, mobile phone, and landline, but got no response from her.

By 6 PM KST on April 23, the deadline for returning company property had passed, so we contacted her again through ADOR’s Vice-president Shin. Vice-president Shin told us, “CEO Min is busy and can’t return the property right now.” We learned about her stance on returning the property through the media, without any direct communication from her, which was irresponsible and not just media play.

Also, it's not true that we took her computer to stop her from working before [NewJeans’] comeback. We immediately gave her a new laptop, and we made sure all her files from the old laptop were transferred to the new one, so her work wasn’t disrupted. Others who were audited received new devices as well and are working with them now.

5. About the claim that we promised her group would debut as the first girl group: 

We addressed this in a detailed email to CEO Min on April 22, 2024. We believe CEO Min says she never received our email because acknowledging it would contradict her false claims. Here's what we explained to her:

‘CEO Min, you are mistaken in your claim about how your separation from Source Music affected the debut timing of NewJeans. It was not a failure on HYBE's part to keep a promise that prevented NewJeans from being the first girl group from HYBE. You wanted complete control over the creation of the group and insisted on debuting them under your own label. HYBE respected your decision, and despite opposition from Source Music, we moved the members to ADOR and provided substantial support of ₩16.0 billion KRW (about $11.7 million USD) to help you debut NewJeans as you envisioned. The delay in NewJeans’ debut was due to the transfer of contracts and the establishment of the new label, not because of any intentions on HYBE’s part.

Furthermore, you have acknowledged this process yourself. In an interview on March 24, 2022, you said that you were in charge of planning the girl group project and decided to launch in the third quarter of 2022. You mentioned, “The young members would naturally feel the pressure of a rushed debut. I did not want to rush them, so I chose a reasonable time for the launch in the third quarter of 2022.”’

6. About the claim that we asked Min Hee Jin not to promote NewJeans during their debut:

The debut of NewJeans was delayed because of issues between Source Music and Min Hee Jin, leading to LE SSERAFIM debuting first. Since both groups debuted back-to-back, there wasn't enough time to promote both effectively. Therefore, we scheduled specific periods for their promotional activities. For example, there was concern about leaks concerning NewJeans' lineup, especially since it was known that Sakura had transferred to Source Music. To maintain the promotional impact for both groups, we asked Min Hee Jin to delay promoting NewJeans, and we even shortened the promotion period for LE SSERAFIM to accommodate this.

We have communicated this to her as follows:

‘You also had an interview two months before LE SSERAFIM’s debut (May 22, 2022), providing a good opportunity to start promoting your new group at that time.

Contrary to your claims, both Source Music and HYBE have been very supportive of ADOR, as the staff can attest.’

7. Regarding the claim that we neglected the promotion of NewJeans:

Min Hee Jin raised this issue in her internal complaint, and here is the detailed response we sent her via email:

‘HYBE’s Communication Department is fully committed to promoting NewJeans. Over the past year, they have issued 273 press releases specifically for NewJeans. For comparison, BIGHIT MUSIC has released a total of 659 articles for BTS’s group and solo promotions across 8 different units. SEVENTEEN, promoted across 4 units, has a total of 365 articles from Pledis. Given these numbers, it's difficult to argue that NewJeans’ PR efforts have been overlooked. The company strives to equally promote all our labels and artists.’

8. About the claim of a slave contract:

CEO Min mentioned a non-competition clause at a press conference, even though it's supposed to be confidential. This clause is standard in many industries to prevent someone who sells their shares from then starting a similar business and competing unfairly.

Claims that the contract binds her indefinitely are incorrect. CEO Min can start selling her shares in November, and she'll be free from the non-competition clause when her contract ends in November 2026. Two years after that, she can cash out and start a new business, which hardly fits the definition of a 'slave contract.' In fact, CEO Min herself said she could earn ₩100 billion KRW (about $73.0 million USD) without doing anything, indicating that the terms of the contract are exceptionally favorable and far beyond what most people could expect.

Additionally, texts between CEO Min and her colleagues mention plans to exercise stock options and potentially exit on January 2, 2025.

As for the contract's sale clauses, there was some confusion over which clause took precedence. We addressed this in a response last December, advising that any ambiguous terms be clarified to avoid issues. Despite CEO Min stating she isn't interested in money, the main focus of the discussions was indeed the scale of the compensation.

9. About the push to implement ESG (Environmental, Social, Governance) management:

We are committed to practicing ESG management within our capabilities. For instance, we have made significant efforts and investments to produce eco-friendly albums, including transitioning from plastic to paper for digital album materials and switching to biodegradable materials for album cases and photocards. These changes have involved considerable manpower and cost.

Despite these efforts, CEO Min has criticized some of these initiatives, such as the biodegradable photocards, calling them a 'joke.' However, adopting these eco-friendly practices is a core part of our ESG management strategy. We are working to apply these eco-friendly album designs across all HYBE labels, though it’s important to note that ADOR has been the least cooperative in embracing these changes.

10. About the claims of no communication attempts: 

We have been in ongoing talks with CEO Min about changing the shareholder agreement. However, these discussions were put on hold when we found out that CEO Min might be acting as a whistleblower. We took the whistleblower claims seriously and responded appropriately.

Despite this, CEO Min secretly worked with lawyers and accountants who are employed by HYBE to figure out how to change the shareholder agreement and create whistleblowing claims. Our audit revealed that she was also talking to law firms and external investors about possibly taking over management rights.

11. About the claim that the shaman is just a friend: 

It's not reasonable to dismiss someone who is deeply involved in management decisions as merely a friend.

This person, referred to as the shaman, has been privy to confidential information such as executive stock options, potential investor names, and shareholder details in a potential management takeover. Sharing such sensitive company information and influencing critical business decisions, including job placement requests, goes beyond a simple friendship. This behavior is taken very seriously by the company.

12. About the claim that HYBE doesn't care about NewJeans during their comeback:

At the time of NewJeans' comeback, CEO Min began sending aggressive emails to the company. Forensic investigations revealed that since April, CEO Min had been planning a publicity campaign and making efforts to create disturbances aimed at the company. We question whether she thought pressuring us during this critical time would force us to give in to her unreasonable demands.

In reality, it seems that CEO Min is the one putting the company in a difficult position by using the artists as leverage. If we agree to her compensation demands, things are fine, but if we don’t, she threatens to sever ties.

While we have tried to meet CEO Min's demands over the years, it has become clear that these are part of her strategy to gain control over management rights. We had to start an audit to protect the value of our multi-label business, regardless of the timing. Additionally, we have consistently asked her not to drag the artists into press conferences and interviews, showing that her actions do not prioritize the artists' interests.

-HYBE