The fingers of her right hand no longer rubbed the table, but gently pressed on a certain line of text in the material.
Then she raised her head, her tone was lighter than before, but her pace was slower, as if she had left the core question of the entire interview until the end.
"Mr. Zhao, you just mentioned 'risk tolerance'. Let's talk about May 2019.
At that time, Era Vanguard's Pledged Shares on Tesla was hunted by Wall Street Short-Selling Alliance, and the stock price fell from three hundred US Dollar to one hundred and seventy-eight US Dollar.
Four investment banks issued Margin Call Notice at the same time, and your position is less than two US Dollar from Liquidation Line.
At that time, you did not reduce your holdings of Nvidia stocks - even though doing so would solve your immediate needs.
On the contrary, you raised funds by pledging the Henglong stocks in your name, pulling Tesla's Pledged Shares back from the edge of the cliff.
I checked the regulatory documents and media reports at the time. Era Vanguard's compliance record during that period was clean, but there was a voice in the market--
It is believed that the position size of Era Vanguard on Tesla is too large and the leverage is too high.
If the pledge financing of Henglong had not been in place in time, the entire position might have been liquidated within one day.
Have you ever thought about what would happen to Era Vanguard without the pledge financing of Henglong?"
Zhao Chen Put the tea cup on the table.
Emily Chang's question was the most pointed one in the entire interview.
She didn't question his compliance or his investment ability, but she was asking something more fundamental--
How big was his Risk Exposure at that time, and whether he tied the risks of Henglong and Era Vanguard together.
"Emily, let me correct one wording - Henglong's pledge financing is not 'to cover the bottom line for Era Vanguard',
The Henglong stocks held under my personal name were pledged to Family Office, a company of Hong Kong.
The purpose of that pledge is to supplement the margin of Tesla Pledged Shares, and has nothing to do with the balance sheet of Henglong Group.
Henglong's entity debt ratio dropped to 17.3% at the end of that year, and all interest-bearing liabilities returned to zero.
Era Vanguard and Henglong are two independent legal entities, which is clearly stated in all SEC disclosure documents."
"I understand the legal independence of the two agencies."
Emily Chang did not give in. She spoke slower than before, but the intensity of each word was stronger.
"But what I want to ask is a more fundamental question - the size of Era Vanguard's positions in Tesla and Nvidia add up to more than 20 billion US Dollar.
Part of the funds for building these positions came from Henglong stock pledge financing.
The stock pledge of Henglong ultimately depends on the stock price performance of Henglong.
The stock price of Henglong will also fall along with global risk assets when the market panics.
If the liquidity crisis in March 2020 lasts another month,
The stock price of Henglong fell below Pledge Liquidation Line, Hong Kong Family Office has the right to dispose of the pledged property.
At that time, Mr. Zhao, the Henglong Shares you personally hold will be replaced by Forced Liquidation,
Control of Henglong may be affected, and the position of Era Vanguard will also face a chain reaction due to the stock price problem of Henglong.
Did you calculate this risk in your decision-making framework at the time?"
Zhao Chen's fingers stopped on the Zisha Pot cover.
Emily Chang's problem was upgraded from "Era Vanguard's Risk Exposure" to "Henglong Control risk",
This is beyond the scope of any 13D declaration document.
What she was asking was a more personal question - Zhao Chen, as the common actual controller of the two organizations,
At some point, the fate of Henglong and Era Vanguard were tied to the same rope.
"I have calculated it." His voice was lower than before, but every word was pronounced steadily.
"If the liquidity crisis in March this year continues for another month, the stock price of Henglong may fall below Pledge Liquidation Line.
The pledged Liquidation Threshold was 207 Hong Kong Dollar per share, while the Henglong stock price was at its lowest point in March at 142 Hong Kong Dollar.
The difference is 65 Hong Kong Dollar.
But there is one variable that I calculated at the time - Henglong had completed the leverage clearing at the entity level before the crisis.
There is sufficient cash in the account, and the floating profit of the position A-share is enough to cover the pledge Financing Principal and Interest.
If the stock price of Henglong really falls below Liquidation Threshold,
I can allocate supplementary pledge from the available funds of Henglong Capital and do not need to reduce any positions of Era Vanguard.
This Contingency Plan was already done before the crisis happened."
Emily Chang was quiet for two seconds.
She turned to the last page of the interview material in front of her, but her fingers did not stop at any specific question.
She raised her head, her eyes were different from all the previous questions -
Before, it was questioning, testing, and dismantling, but now she is just making the final confirmation.
"Mr. Zhao, you just mentioned a word-'Contingency Plan'.
When you did those Contingency Plan, you were alone in Manhattan's hotel.
Your team is in the country, and the institutional framework of Henglong has not yet been fully established.
Era Vanguard's compliance record has not been reviewed by the SEC, and all judgments rest on you alone.
How did you get over that kind of pressure?"
Zhao Chen was silent for a few seconds.
It was dark outside the Jiangbeizui window, and the Chaotianmen Bridge steel cables shone silvery white in the darkness.
He picked up Zisha Pot and poured himself the last cup of tea today. The subtle sound of water flowing when Tea Soup was poured into the cup was particularly clear in the quiet office.
"I don't need to carry it alone.
Manhattan Those nights in the hotel, I was indeed alone.
But then I built a system and assigned Decision-Making Rights to Investment Decision Committee, Research Institute, Legal Department and Shen Jue.
Today you asked me why I could bear it - not because I could bear it better than others, but because I no longer had to bear it alone.
This is the most important thing I learned during that time - no matter how strong a person is, there are variables that cannot be calculated.
But a system can do the math for me."
He put the tea cup on the table and looked across the screen to meet Emily Chang.
"Era Vanguard's position logic on Tesla has never changed from the time it was established to today.
A stock split won't change it, stock price fluctuations won't change it, and any external shock won't change it.
That's all I want to say today."