Common gambling agreements between companies
What is a gambling agreement?
It refers to an agreement designed by investors and financiers to adjust the valuation of the future target company in order to solve the uncertainty, information asymmetry and agency cost of the future development of the target company, including share repurchase and monetary compensation.
A simple understanding is to bet on the company's future performance or other circumstances and make an agreement on the uncertain future.
For example:
Zhang Guoli signed a five-year gambling agreement with Huayi, demanding that Zhang Guoli's after-tax net profit for 20 13 years should not be less than 30 million, and increase year by year.
In order to win the bet, Zhang Guoli is open to almost all kinds of cooperation. At that time, he had to shoot a lot of bad films and was scolded for his money.
Later, Zhang Guoli publicly stated: "After signing this agreement, there is no threshold for everything, as long as you give money."