Chapter 494: Chapter 285: Dust Settles_2
“The expected target will be evaluated by a third party, combined with Xingye Products’ historical performance and future developnt plans. We guarantee that this target will be based on objective data and market analysis, and not arbitrarily set.”
Chen Cheng paused, “Moreover, we are also willing to discuss and ultimately determine this expected target with you to ensure its fairness and reasonableness.”
After listening to Chen Cheng’s explanation, Lin Weixiong nodded, “Good, I agree with this plan.”
“Another thing, what about Flying Bird’s exit?” he continued to ask: “If I want to exit this VIE structure in the future, I need a clear path and guarantee.”
“This is part of the subsequent repurchase terms.”
Chen Cheng once again scrolled his mouse, and a detailed repurchase agreent appeared on the screen.
“Five years later, or after Xingye Products’ operations have fully settled in China, we are obliged to repurchase your investnt during the ti at Flying Bird Trading Co., and calculate the investnt return based on the five-year loan market quotation interest rate (LPR). Specifically, the repurchase price will be calculated based on the following formula:
Repurchase price = Initial investnt amount × (1 5-year LPR average value)^5 Total managent fees collected × (1 5-year LPR average value)^remaining years’ average value”
Increasingly professional financial reports appeared in front of Bai Wei and Lin Weixiong.
What Lin Weixiong saw was a foolproof deal, while Bai Wei saw Chen Cheng’s strong capabilities, and why Chu Qin was helping him so much.
“The initial investnt amount refers to the amount directly invested by Mr. Lin in Flying Bird Trading Co. to set up the VIE structure, I estimate you need to inject 140 million renminbi.”
“This amount of capital will be considered as a five-year investnt, with compound interest calculated based on the average value of the five-year LPR.”
“This five-year LPR average value refers to the average of the five-year LPRs announced each year before the year of repurchase. For example, if the repurchase occurs in 2029, it involves calculating the average from 2024 to 2028.”
Chen Cheng gradually explained the terms:
“The total amount of managent fees collected refers to the sum of all managent fees Mr. Lin has collected from us during the cooperation period.”
“The remaining years’ average value refers to the average number of years remaining from the year each managent fee was collected to the year the repurchase occurs.”
“To clarify further, I have had a simulation repurchase done based on an injection of 140 million.”
Chen Cheng pointed to the simulation calculation on the screen, “Assuming Mr. Lin’s initial investnt amount is 140 million renminbi, and the five-year LPR average is 4%, then the repurchase price after five years will at least be 170 million renminbi.”
“Plus the annual 8 million managent fee, calculated with the remaining years’ average and LPR rate for investnt returns, the final total repurchase price will far exceed Mr. Lin’s initial input, ensuring a substantial return for Mr. Lin.”
Chen Cheng paused, adding, “Of course, this is just a simulation based on the current LPR rate. The actual repurchase price will be adjusted according to the fluctuation of the LPR rate over the next five years. But even if the LPR rate decreases, we will ensure that Mr. Lin’s final returns are no less than an annualized return rate of 8%.”
Lin Weixiong carefully studied the terms and formulas on the screen, realizing that Chen Cheng was not speaking off the cuff, but had thoroughly calculated and prepared.
An investnt of 140 million, promising a return of at least 170 million in repurchase after five years, plus nearly ten million per year in managent fees and dividends, this favor was considerably rewarding.
“Mr. Chen is a straightforward man!”
Lin Weixiong gave a thumbs up, “I’ve never encountered such a straightforward deal!”
“We’re all compatriots, and I appreciate your stepping forward to help and Xingye Products solve this problem at this ti.”
Chen Cheng confidently declared, “Besides, it’s better for our own people to earn this money than to let it go cheap to the Japanese~!”
“Right~!”
Lin Weixiong was even sowhat excited; he slamd the table and said boldly: “Mr. Chen, I admire your spirit! Just for that statent, I, Lin Weixiong, am in on this cooperation!”
He laughed heartily, his normally shrewd businessman image now exuding a kind of bold, jianghu spirit.
Chen Cheng shook his offered hand, “Mr. Lin, pleasure to cooperate.”
“Pleasure to cooperate!”
Bai Wei, watching from the side, admired Chen Cheng’s boldness, and understood why this young man was favored by Chu Qin.
“Lao Lin, about your investnt, it should be processed as soon as possible,” Bai Wei reminded. “Mr. Chen’s side has all the procedures ready.”
“No problem, I’ll raise the funds after I return, and the money will be in the account by tomorrow afternoon at the latest!”
Bai Wei nodded, “Mr. Chen, how soon can the funds from CGG arrive?”
Chen Cheng answered, “Anyti, just a phone call away. They are ready and just waiting for our agreent to be signed.”
He added, “To ensure the security and transparency of the funds, CGG suggests using the chamber of comrce’s regulated account for the transaction. What do you both think?”
Lin Weixiong had no objections to this proposal, “That’s fine, I completely trust the chamber and Mrs. Liang.”
He knew well the reputation and influence of the chamber; using a regulated account could effectively avoid risks and protect both parties’ interests.
Bai Wei nodded in approval, “Then it’s settled. I will arrange for the chamber’s staff to assist you with the procedures.”
She turned to Lin Weixiong, “Lao Lin, after your funds are in place, I will inform Mr. Chen, and then you can transfer into Xingye Products’ account.”
“Okay, let’s do that,” Lin Weixiong agreed readily.
At this mont, AB has been resolved, only Chen Cheng’s C remains.
“C? Is it all set?” Bai Wei asked.
Chen Cheng nodded, “This morning, Beijing Risheng Trading Co. Ltd was fully registered.”
He took out his phone, “Here are the business license and account number.”
Bai Wei looked at them, “Then, between Flying Bird Trading Co. and Beijing Risheng Trading Co. Ltd, so technical service agreents and consultancy agreents still need to be signed.”
Chen Cheng nodded, “The agreents are already prepared. The purpose of these agreents is to accomplish the final goal of the VIE structure, which is to legally and compliantly transfer the profits of Xingye Products to dostic Beijing Risheng Trading Co. Ltd.”
“Specifically,”
He took out the prepared contracts, “the technical service agreent stipulates that Flying Bird Trading Co. will provide a series of technological support and services to Beijing Risheng Trading Co. Ltd, such as market research, product developnt, technical consultancy, etc.”
“As compensation, Beijing Risheng Trading Co. Ltd will pay a fee for technical services. This fee will be adjusted based on the actual profits of Xingye Products, ensuring that most of the profits can be transferred to Beijing Risheng Trading Co. Ltd.”
“The consultancy agreent stipulates that Beijing Risheng Trading Co. Ltd will provide managent consulting services to Flying Bird Trading Co., including strategic planning, operational managent, financial analysis, etc. Similarly, Flying Bird Trading Co. needs to pay consultancy fees to Beijing Risheng Trading Co. Ltd, and this fee will also be tied to the profits of Xingye Products.”
Three copies of the contract, accommodating six copies, were laid in front of Lin Weixiong.
Bai Wei said on the side, “Lao Lin, signing these agreents poses no risk to you; it’s just a formal procedure. But it’s a crucial part of the process, and I hope you can understand and cooperate.”
Lin Weixiong smiled and said, “Mrs. Liang, don’t worry. I’ll sign right now.”
As soon as he finished speaking, he grandly signed his full na on the blank paper.
Seeing this, Chen Cheng was also pleased.
“Alright, everything is almost handled,” Bai Wei sighed deeply, “now, we just wait for Xingye Products to release the announcent.”
i Xiang, who had been quiet, nodded vigorously, “Ms. Bai, I can issue the acquisition announcent at any ti.”
She looked towards Chen Cheng, seemingly seeking final confirmation.
Chen Cheng understood i Xiang’s intention, he slightly nodded, giving her an affirming look.
He knew she had been waiting too long for this mont, now, it was ti to let everything settle.
“Good,”
Chen Cheng turned to Bai Wei and Lin Weixiong, “Since that’s the case, let’s issue the announcent as soon as possible. The sooner the acquisition is completed, the better for us.”
Bai Wei also expressed agreent, “Sooner rather than later. Miss i Xiang, please arrange it as soon as possible.”
i Xiang imdiately took out her phone and dialed the public relations departnt.
“I am Hoshino Mika, please issue the acquisition announcent regarding Flying Bird Trading Co. and Xingye Products, execute it imdiately.”
She paused, emphatically saying: “Yes, right now!”
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