When Fang Hong came to Qunxing Capital, there was another news related to Hengtong Pharmaceutical.

That is: if Hengtong Pharmaceutical can not complete the IPO this year, and take the second place to seek mergers and acquisitions, Hengtong will be acquired by a third party and exit will become unpredictable, Zhongtai Capital in order to ensure the smooth exit, set up a fallback clause: in case it cannot be listed, the enterprise must repurchase the equity in the hands of Zhongtai Capital with a return on investment of five times to ensure the smooth exit of the investor.

As soon as this rumor came out, it stirred up a thousand waves.

Since the end of 2007, Hengtong Pharmaceutical Group has begun to sprint for A-shares, and is exhausted by this, because there is a series of agreement clauses, which forced Wang Qingxiong to accelerate the IPO process of Hengtong Pharmaceutical Group.

At the beginning of 8, Hengtong Pharmaceutical Group officially submitted a listing application to the main board of A-shares, but considering the number of companies in the queue for the big A listing and the review process, the time is already very tight to be listed before 2009.

Unforeseen is that a financial tsunami swept the world last year, and after the submission of Hengtong Pharmaceutical's listing application, its application materials were actually in a state of "cold palace".

After a year of tossing, there is no way to list A-shares.

After being rejected by Big A, due to the signing of a VAM agreement with Zhongtai Capital, Zhongtai asked Wang Qingxiong to repurchase the equity at a high price according to the agreement.

For Wang Qingxiong, he felt that he himself had lost a lot, and in such a situation, both sides were dissatisfied, and the contradictions had existed and accumulated half a year ago.

However, Wang Qingxiong still held back and negotiated with Zhongtai Capital, hoping to give another half a year.

After successfully winning an additional half-year time limit, Wang Qingxiong retreated and began to switch to H-shares, and if A-shares could not be listed, he sought to go south to Hong Kong for listing.

However, the roof leak happened to rain overnight.

After tossing for half a year this year, the switch to H-shares can basically be declared a failure.

It is absolutely impossible for the current Zhongtai Capital to give Wang Qingxiong any grace time, and he will be given half a year before because he has not found a third party to take over.

But now it's different, Qunxing Capital jumped out and shouted that it was willing to take over and had the strength to take over, and Zhongtai Capital of course chose to withdraw with interest without hesitation.

As for what will happen to Hengtong Pharmaceutical and Wang Qingxiong, Zhongtai Capital will not care about these at all.

Hua Yu got up and went to his desk to get a copy of the materials and handed it to Fang Hongdao: "This time, I met with Liu Qizheng, the head of Zhongtai Capital, and obtained more specific terms and conditions of the series of agreements from him.

As a private equity financing, entrepreneurs and investors are naturally indispensable to sign a series of investment agreement term lists, as little as a dozen or more dozens, in the game between entrepreneurs and investors, if the investor takes the lead, the investor will form various constraints on the venture in an all-round way to protect its own investment interests.

To put it bluntly, investors' money is not so easy to get if they want to get it, and the cost of getting it is also very large, and the potential risk is not small.

It was really dug up by the investor, set up a situation and didn't realize it, and how to handle the entrepreneur in the future depends on the investor's mood.

Hua Yu said with great certainty: "Wang Qingxiong is completely finished this time."

Fang Hong went through the liquidation preference clause, share repurchase clause and lead right clause signed by Hengtong Pharmaceutical Group and Zhongtai Capital in this material report.

After a while, Fang Hong couldn't help but look at each other with admiration: "Zhongtai Capital is also playing tricks, especially these three major terms are interlocking, once triggered, it is a chain trigger, Wang Qingxiong is indeed finished, and the fish on the chopping board is ironclad."

【Liquidation Priority Clause】

If Hengtong Pharma triggers a liquidation event, the A series of preferred shareholders, that is, the investor (Zhongtai Capital), have the right of preference, and the common shareholder, that is, the venture shareholder (Wang Qingxiong), will receive a return of 5 times the initial purchase price per share.

Liquidation here is not commonly understood because of insolvency

Bankruptcy liquidation that cannot continue to operate, but further, if the company is merged, acquired, sold a controlling stake, and sells major assets, resulting in the company's existing shareholders holding less than 50% of the equity of the surviving company, it will also be a liquidation event.

The terms of this agreement are down-to-earth, for example, Hengtong wants to sell its equity, and the equity in the hands of Zhongtai Capital is sold first, and Wang Qingxiong is queuing up at the back.

【Share Repurchase Terms】

If a majority of the Class A preferred shares (Zhongtai Capital) shareholders agree, Hengtong Pharma should repurchase the outstanding Class A preferred shares in three years, starting from the fifth year, at a price equal to the original issue price plus declared but unpaid dividends.

Of course, the trigger method of share repurchase can also be triggered by a specific time event specified in the clause instead of voting by preferred shareholders (Zhongtai Capital), such as if the company fails to achieve IPO within five years, the share repurchase clause will be triggered.

Now that not only the five-year period has passed, but also extended for half a year, there is no doubt that Hengtong Pharmaceutical has triggered this clause because of a temporal event.

【Terms of Sale】

Prior to the IPO of Hengtong Pharma, if a majority of the Class A preferred shareholders (Zhongtai Capital) agree to sell or liquidate the company, the remaining Class A preferred shareholders and common shareholders should agree to the transaction and sell their shares at the same price and conditions.

These three major clauses are now all triggered, and Wang Qingxiong is already a fish on the board.

The liquidation preference clause means that Zhongtai Capital can sell first, which is the first link; The share repurchase clause is to ensure that Hengtong Pharmaceutical's listing fails, but Zhongtai Capital can also withdraw with interest, which is the second link; The terms of the right to sell are that Zhongtai Capital can sell its equity in Hengtong Pharmaceutical to whoever it wants, and Wang Qingxiong must agree to the transaction.

Zhongtai Capital is now going to sell to Qunxing Capital, and Wang Qingxiong is not in a rut, and the most important thing is the word "lead sale", that is to say, who does Zhongtai Capital want to sell to, Wang Qingxiong can also sell his shares with Zhongtai Capital at the same price and conditions, because the difference requires Wang Qingxiong to sell his equity to compensate Zhongtai Capital, which is the last link.

Under the interlocking of this series of terms, Wang Qingxiong is already inexorable, and from the moment of the failure of the listing, he has been unable to decide the future of Hengtong Pharmaceutical, which is completely controlled by Zhongtai Capital.

Fang Hong put the materials aside, and immediately said: "Pack a debt as soon as possible and put it in the asset profit and loss statement of the shell company, and some of the non-performing assets of your Huayang Group will also be included a little bit."

Hua Yu nodded and asked bluntly, "How much?"

Fang Hong pondered for a moment, and said concisely: "Pack a 20 billion scale to go in."

Hua Yu nodded again: "Understood."

Packing a debt or non-performing asset package of 200 billion yuan and putting it in Ruihe is naturally the third-step strategy to annex Hengtong Pharmaceutical Group, and the third-step strategy formulated by Fang Hong is to completely clean up Wang Qingxiong, which is also the most ruthless step in the entire bureau.

After completing the second step of the "cage for birds" strategy, Hengtong Pharmaceutical's valuable things were packaged and moved to the name of the shell company Ruihe, at this time, Qunxing Capital accounted for 88% of the equity of Ruihe Company, and Wang Qingxiong still held 9% of the equity, and the remaining 3% were other small shareholders.

Wang Qingxiong is a minority shareholder relative to Qunxing Capital at this time, but he still holds 9% of the equity and is still the second largest shareholder of the company, and he still has a lot of right to speak.

After the annexation of Hengtong Pharmaceutical, Fang Hong is going to carry out a large-scale restructuring of Ruihe, and the biggest obstacle at this time will inevitably be Wang Qingxiong, the second largest shareholder, at this time, the first thing Fang Hong wants to do is not to reorganize, but to kick Wang Qingxiong out completely, otherwise he will always jump out of the opposite tune, even if it can't have a practical impact on your plan, he can disgust you from time to time.

Fang Hong also firmly believes that Wang Qingxiong will inevitably do this, after all, from his point of view, the company he established and created was swallowed up by the stars, how could he be willing? How can there be no resentment in the heart?

For example, Wang Qingxiong relied on his status as the second largest shareholder to ask for an audit of accounts, instigated several small shareholders to ask for a general meeting of shareholders, proposed to dissolve the company, and so on

You also have to play with him and accompany him through the process.

Although it will definitely not pass in the end, it is disgusting.

So he must be completely out, and there are not so many black and white games in the capital market.

Fang Hong's choice as a rational person is destined to do this matter absolutely, to eat and wipe it clean, and not to leave potential risks and hidden dangers for himself.

There will be no psychological burden on doing such a desperate job, this is the reality of the capital market, not to mention that Wang Qingxiong himself is not a good bird, and he is not worthy of sympathy if he ends up like this, so there is no psychological burden.

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