Article: "50 billion won for 10 years even if Lee Soo-man doesn't work"... 'Emperor's Contract' until 2092
Source: Joongang Ilbo
Lee Soo-man's newly signed contract with SM is catching attention.
Last year, Lee Soo-man raised a white flag in response to shareholder protests over his private company's service contract that was eventually terminated early. However, it turns out there's another contract that allows him to collect billions of won for the next 70 years, even if he doesn't do anything.
On the 9th, Align Partners Asset Management leaked details of the original contract by the SM Board in response to Lee Soo-man's claims of "illegal" activity. According to the document, the contract with Like Planning was terminated early on December 31, last year. However, according to Attachment 2 of the 'Producer License Agreement' which was signed and extended in 2015 under 'Agreement on Settlement after Contract Termination,' Lee Soo-man has virtually no service obligations and will receive 6% in royalty revenue until 2092 from previously released music sources. Until end of 2025, he will also receive 3% royalties on management profits.
According to Align, if the post-settlement agreement is fulfilled, more than 40 billion won will be paid to 'Like Planning' for the first 3 years and more than 50 billion won will be paid over the next 10 years.
Align revealed, "The Seoul Regional Tax Service conducted tax audits twice and imposed large-scale fines of tens of billions of won on the Like Planning service contract and producing license contract. We have terminated the Like Planning contract however the post-payment agreement is still in effect."
Align further pointed out, "SM Board's fulfillment of the post-settlement agreement could fall under the Fair Trade Act for an act of unfair support of a person in a special relationship, or a violation of the statute of breach of trust in business. This is contrary to the director's duty of care (obligation to strive for interests of the company), etc. Minority shareholders have a right to request directors to stop such violations if there is a concern that irreparable damage can be caused to the company due to the officer's direct violations of laws or articles of incorporation."
SM's CFO Jang Cheol-hyeok stated, "It's a difficult situation because we cannot cancel the agreement without consent from the company's largest shareholder and contractor in question (Lee Soo-man)."
So far, Lee Soo-man has earned over 148.6 billion won in royalties through his private company since stepping down as SM Director in 2010. That's equal to 35% of SM's operating profit.
Meanwhile, Lee Soo-man has filed a criminal suit against SM co-CEOs Lee Sung-soo and Tak Young-joon after they announced his "resignation" and issued shares to new 2nd largest shareholder Kakao who now holds a 9.05% stake in the company.
- [+382, -3] Daebak.. as expected from the creator of the original slave contractㅋㅋ
- [+258, -5] Soo Man-ah, is this for real? Just quietly withdraw and enjoy a luxurious life with all your riches. Go out! You've eaten enough. It's time to step back now. Get rid of all those dirty behind-the-back contracts you set up too ,,,, ㅠ
- [+252, -6] Soo Man-ah, where are your donations? Send some to Ukraine and plenty to Turkey.
- [+140, -7] Isn't this a scam?
- [+56, -3] The company structure is one where the Chairman and his underlings all get to gulp up hundreds of billions of won in profits. I admit he has grown the company to an impressive level but how long does he think he can keep the straw in? If SM=Lee Soo-man, then it's only right that the company disappears along with him.
- [+48, -1] The key issue is.. as a shareholder, you have to wait to receive profits through stock dividends. But you will rarely if ever receive any profits through dividends because of strange obscure service contracts like this that don't allow for the usual process for dividends.. only Lee Soo-man gets to siphon out profits solely for himself.
- [+44, -1] I admit he's greedy too but let's be honest, SM is his company that he built with his own hands. It's only natural that he wants to take out all the profits that he has built up? How many of you would easily give it all up after they cut your position? Let's not kid ourselves with our conscience here and blindly curse Lee Soo-man. If everything was done legally, I can see how things got to this level.
- [+33, -6] It's not like we're living in a communist society. Idols and singers from his company are sitting on wealth cushions after buying tens of billions of won in buildings but the representative can't take home some of that money too?
- [+40, -15] If the SM founder is only allowed to take 6% of the music royalties rather than 60%, that means 94% is left for the remaining shareholders.. you know he can decide to just eat up all the profits himself?!! Kakao is also now eating alongside Lee Soo-man but what work have they done exactly? If an assistant manager can get 5 billion severance, Soo-man hyung is SM founder.. it's only right that he gets that much...ㅉ ㅉ
- [+26, -1] He won't even be alive in 2092.. just donate it and go..
- [+23, -1] But how is it fair that celebs caught up in scandals are allowed to crawl back to the industry while the rest of us and buried trying to repay our debts? In the end, all the money they're making impacts the cost of living for the rest of us but of course this issue is always overshadowed by those with power.
- [+20, -0] All these 'Big 3' and one-man agencies need to get investigated! Disclose the names of celebrities that illegally evade the law and don't pay taxes. We need to look into that singer who said their spouse asked to buy a Mercedes Benz as a birthday present. We never ever get comfort from celebrities in our country, it's always stresses.
- [+13, -1] Pro-china ba$tards need to get kicked from our country ~~