Incredible Buzz to Hold Extraordinary Shareholders Meeting on 23rd, Vows to Prove Corporate Normalization Potential

Incredible Buzz announced on the 11th that it will hold an extraordinary general meeting of shareholders on the 23rd. Incredible Buzz stated, "This extraordinary general meeting of shareholders is not simply about a corporate governance dispute, but a critical occasion to decide whether to maintain management continuity that will allow us to keep pursuing the resumption of trading and the normalization of the company."

According to the company, this extraordinary general meeting of shareholders is being convened at the request of certain shareholders, and agenda items include amendments to the articles of incorporation and the appointment and dismissal of directors and auditors. The company explained, "These agenda items contain provisions that could simultaneously change the composition of the board of directors and the structure for appointing the CEO within a short period of time, which could act as a burden on management stability at a time when trading is suspended and a substantive review of listing eligibility is underway."

Regarding the background to the convening of the extraordinary general meeting, the company stated that, following a series of complex capital transactions around June 2024, including a third-party allotment paid-in capital increase, a share transfer accompanied by a change in the largest shareholder, and decisions on the sale and issuance of convertible bonds (CB), stock price volatility and conflicts of interest among investors have been accumulating. During this process, some investment associations recouped their investments by selling their stakes or exercising conversion rights during a stock price upswing, and the company said that, during the subsequent downturn, some associations whose exits were not going smoothly expressed their intention to request that the current largest shareholder purchase their shares.

The company stated, "These purchase requests included conditions that were far above the market price, and we did not accept them because we judged that doing so would not be appropriate in terms of the overall interests of shareholders and the company's financial soundness." After that, the associations in question demanded the convening of an extraordinary general meeting of shareholders and began pushing for a change of the board and management, and the company recognizes that this process is ultimately unfolding in a direction that burdens management continuity.

With respect to the current trading suspension, Incredible Buzz said that it "stems from the occurrence of grounds for a substantive review of listing eligibility due to the accumulation of penalty points for unfaithful disclosures arising from past decisions to issue convertible bonds and subsequent repeated delays in payment and cancellations of issuance, as well as changes to disclosures related to paid-in capital increases." The company explained that these disclosure issues largely originated from the structure of past capital transactions and the decision-making that took place in the course of those transactions.

The current management is faithfully carrying out the procedures for resuming trading through ongoing communication with the stock exchange. The company emphasized, "The most important factor for the resumption of trading is not a rapid change in corporate governance, but proving the possibility of corporate normalization through business sustainability and tangible results."

In this regard, Incredible Buzz has been pushing, since the second half of 2024, to shift its business portfolio away from its existing focus on luxury goods distribution toward a focus on healthcare, medical devices, and platforms. The Nutrakos business is generating a stable revenue stream, and the beauty fintech platform "Gangnam Oppa" is contributing to revenue diversification through financial and advertising income. In addition, Aminogram and Sunekos are undergoing domestic approval procedures, and the company expects that they may establish themselves as sustainable revenue models based on a repeat-purchase structure going forward.

The company has previously presented, through explanatory materials, that in relation to some of the parties proposing the extraordinary general meeting, there have been confirmed cases at other listed companies in the past where similar patterns of changes in the largest shareholder and capital transactions were followed by stock price volatility. The company is concerned that, "In light of such precedents, replacing the board of directors without sufficient presentation of normal business operation experience and a medium- to long-term strategy could actually increase uncertainty regarding the resumption of trading and the normalization of the company."

A company representative said, "In the substantive review of listing eligibility and the process of resuming trading, the Korea Exchange focuses on management continuity, business sustainability, and the possibility of a turnaround through actual performance," adding, "Since the ongoing business transformation and performance-generation trends have been accumulated under the current management, continuing this without disruption is the most realistic choice for resuming trading."

The representative added, "Supporting the maintenance of the current management system at this extraordinary general meeting of shareholders is the best way to resume trading and restore corporate value."

This content was produced with the assistance of AI translation services.