After all the publicity surrounding Kim Soo Hyun's decision to cancel his contract to appear in bottled water ads for the Chinese company Hengda, it seems that the actor has changed his mind.

Kim Soo Hyun's agency, KeyEast Entertainment, has announced that the actor and the company have reached a settlement that involves the actor continuing to model on behalf of Hengda Bingquan.

"After rounds of discussion, China's Hengda Group and KeyEast came to the agreement to fulfill the responsibility bound by the trust of two companies rather than resorting to extreme measures," a representative for Keyeast Entertainment told the Korea Herald.

According to KeyEast, Hengda is sympathetic to the controversy surrounding the labeling of the water bottle and promises to be more understanding in the future. Company representatives assured KeyEast that there were no political intentions when they labeled the source of the water as Jang Bai Shan, the Chinese name for a mountain that the spring water comes from.

What the mountain is called matters because the name is at the heart of a controversy about Chinese and Korean history. Some Chinese academics claim that the mountain, which lies on the border or North Korea and China, should be considered part of China.

But the mountain is significant to the Korean people as being the place of the nation's origin and in Korea it is called Mount Baekdusan. Some Koreans were offended that Hallyu stars Kim Soo Hyun and Jun Ji Hyun would advertise a brand of water that named the mountain Jang Bai Shan.

When the controversy arose, the Hallyu stars tried to cancel their contract but rumors quickly spread that they would each be fined $5 million. While KeyEast denied that the penalty for canceling the contracts would be that high, the agency and the company had yet to finish their negotiations.

There is no word as to how high the penalties would actually have been if the actor had canceled his contract as planned. But the penalties probably played a part in deciding to go through with the contract's obligations.

"It is the hope that there will not be further misunderstandings or speculations," a Key East representative told the Korea Herald. Kim's co-star Jun Ji Hyun has yet to decide what she will do about her contract to represent Hengda Bingquan. Her agency, Culture Depot, is currently in negotiations with Hengda.

The ads for bottled water are one of the many commercial offers that Kim Soo Hyun and Jun Ji Hyun were offered after the Chinese success of their drama "You Who Came From The Stars."