Recaps

Zhao Chen pushed Henglong’s rights issue through resistance from Lin Wanqing while facing conflict with Zhao Jianguo and helping Su Wantang end her marriage. The Whitewash Waiver passed, clearing the final procedural obstacle to the issue.

• Zhao Chen secured board approval for the 10-for-4 Subscription Plan, with Lin Wanqing as the sole dissenter, and Lin retaliated by leaking allegations about Zhao Jianguo to the media.
• Zhao Chen proceeded with the plan despite the scandal and confronted Zhao Jianguo, invoking his proxy over his father’s voting rights to prevent him from overturning the board’s decision.
• Su Wantang divorced Zhao Jianguo, ended their Co-action Agreement, and retained her 5% stake as an independent shareholder.
• Zhao Chen defended Henglong’s low-debt strategy at the shareholder meeting and answered Lin Wanqing’s challenge to the rights issue’s funding and purpose.
• The shareholders supported Zhao Chen’s case for reducing debt and strengthening liquidity, while Zhang Qingxue explained that a Whitewash Waiver was needed because Zhao Chen’s subscription could push his stake above 30 percent.
• Su Wantang voted as an independent shareholder, and the independent shareholders approved the Whitewash Waiver, removing the final procedural obstacle to the rights issue.

Zhao Chen secured control of Henglong through the rights issue, using Bitcoin proceeds to fund his subscriptions and Shen Zhiyi’s 5% stake. After scrutiny of his funds and relationship with Shen Zhiyi, regulators cleared the issue, and the stretch ended with Zhao Chen beginning a speech at Zhengfa University.

• At Zhengfa University, Zhao Chen addressed reporters about his responsibilities as Henglong’s acting chairman and his low-debt strategy.
• Zhao Chen set the rights issue timetable, while Lin Wanqing challenged the schedule and later urged Zhao Jianguo to sell their rights rather than spend their remaining cash subscribing.
• Zhao Chen asked Shen Zhiyi to hold 28 million rights-issue shares for him, and Shen agreed without requiring a written agreement.
• As Lin Wanqing sold rights at a discount, Zhao Chen directed Chen Xi and Shen Zhiyi to buy them, then sold Bitcoin to raise the funds needed for the issue.
• Zhao Chen subscribed for 100 million shares and Shen Zhiyi for 28 million, leaving Zhao Chen’s side with 40.71% of Henglong after the issue and Zhao Jianguo’s side with 30.35%.
• Lin Wanqing prompted a report questioning Zhao Chen’s funding and exposed Shen Zhiyi’s stake, bringing public attention and scrutiny of the pair.
• Henglong said Zhao Chen’s money came from lawful investments, and regulators confirmed his funds had passed preliminary review and the rights issue complied with the rules.
• Shen Zhiyi chose to return to campus and pursue her exams, while Zhao Chen prepared a speech at Zhengfa University and opened it by identifying himself as both a student and Henglong’s acting chairman.

Zhao Chen tightened Henglong’s audits while preparing to confront Lin Wanqing and protect Zhao Jianguo’s pledged shares. Lin’s public allegations turned the dispute into a media storm, and Zhao Chen arranged to take over his father’s shares as the arc ended with a plan to secure the transfer.

• Zhao Chen delivered a lecture on Bitcoin regulation and compliance, answered students’ questions, and later discussed the speech with Shen Zhiyi and Chen Xi.
• Zhao Chen’s team reviewed Lin Wanqing’s finances and proposed audits, project assessments, and supplier checks, while Zhang Qingxue warned that exposing Henglong’s irregular equity-like debt could hurt the company and its shareholders.
• Zhao Chen sold Henglong’s Tesla holdings for 61.5 million US dollars and began exploring a strategic investment in a hog-breeding company.
• After Zhao Chen ordered audits, Deloitte found excess payments, fabricated construction quantities, and substandard materials involving seven suppliers, while Lin Wanqing’s companies struggled to meet payments.
• Zhao Chen visited Shen Zhiyi’s parents and promised Shen Wentao that he would be honest with her, then watched Lin Wanqing claim publicly that she had been Zhao Jianguo’s partner and had three children with him.
• Reporters confronted Zhao Chen after Lin’s interview went viral, and he approved a public statement denying knowledge of his father’s other children and reserving his right to pursue Lin for damaging his reputation.
• With Zhao Jianguo’s pledged shares at risk of forced liquidation, Zhao Chen arranged for Henglong to take them over and planned to visit his father in detention.
• Zhang Qingxue explained that the transfer required disclosure and a new Whitewash Waiver, and proposed that Zhao Jianguo pledge his ten million unpledged shares to Zhao Chen as security.

Zhao Chen secured control of Henglong while Lin Wanqing and short sellers tried to drive down its stock. Shen Jue’s intervention triggered a squeeze that ended in a negotiated closeout, though Zhao Chen was left wondering what she had really wanted.

• Zhao Chen used the revelation of Zhao Jianguo’s relationship with Lin Wanqing to expose their family scandal, then negotiated Zhao Jianguo’s transfer of 170 million Henglong shares for HK$100 million.
• Zhao Chen revealed that he had long known about Zhao Jianguo’s three children with Lin Wanqing, and warned him not to give his retirement money to her.
• At Henglong’s board meeting, Lin Wanqing admitted her relationship with Zhao Jianguo and said she planned to leave, while the directors removed her as Finance Director and ordered audits of her allies.
• Henglong announced Zhao Jianguo’s share transfer and Lin Wanqing’s departure, while Zhao Chen’s group prepared to defend the company’s stock from short sellers.
• Zhao Chen’s allies and Shen Zhiyi bought Henglong shares as short sellers attacked, while an unknown account purchased shares and helped the price recover.
• Shen Jue revealed that she had caused the mysterious purchases, then continued buying Henglong shares as short sellers ran low on shares and Zhao Chen arranged to withdraw 100 million shares from the lending pool.
• Brokerages halted lending Henglong shares, the stock surged, and the short-side fund manager jumped to his death.
• At a regulatory meeting, Shen Jue demanded 30 yuan per share for a closeout, but the exchange negotiated a price of 15 yuan, leaving Lin Wanqing and the other short-side backers responsible for part of the losses.