A general review of words

and phrases learned in the

6th week
汇报人：姚凯
整理人：何福龙，楼帅涛，黄振国
 words in PPT

Limited partner / general partner 有限合伙 / 普通合伙

Closed end 封闭式的（无法取回，死期）
Carried interest 附带权益
Premium 溢价
Senior debt 优先债（企业破产时可优先受偿）
Hedge fund 对冲基金
Junior/subordinated debt 次级债务
collateralized loan obligation 贷款抵押债券 / 担保债务凭证
Mezzanine debt 夹层资本 / 夹层融资
Committed capital 应急资本 / 承诺资
本
Domicile 住所
Arbitrage 套利
Authorization 批准、许可
subscription 认购
Segregation 分离
In-kind 实物
Stock exchange listing 交易所上市
Tax neutrality 税收中立
Leveraged Buyout and Private Equity
In a leveraged buyout （杠杆收购） , a company is acquired by a
specialized investment firm using a relatively small portion of equity and a
relatively large portion of outside debt financing. The leveraged buyout
investment firms today refer to themselves (and are generally referred to)
as private equity firms （私募股权公司） . In a typical leveraged buyout
transaction, the private equity firm buys majority control of an existing or
mature firm. This arrangement is distinct from venture capital firms （风险
投资公司） that typically invest in young or emerging companies, and
typically do not obtain majority control. In this paper, we focus specifically
on private equity firms and the leveraged buyouts in which they invest, and
we will use the terms private equity and leveraged buyout
interchangeably （可交替地） .
Leveraged buyouts first emerged as an important phenomenon in the
1980s. As leveraged buyout activity increased in that decade, Jensen
(1989) predicted that the leveraged buyout organizations would
eventually become the dominant corporate organizational form. He
argued that the private equity firm itself combined concentrated
ownership stakes in its portfolio companies （皮包公司） , high-
powered incentives for the private equity firm professionals, and a
lean, efficient organization with minimal overhead costs （间接成本） .
The private equity firm then applied performance-based managerial
compensation （绩效管理薪酬） , highly leveraged capital structures
(often relying on junk bond financing), and active governance to the
companies in which it invested. According to Jensen, these structures
were superior to those of the typical public corporation with dispersed
shareholders, low leverage, and weak corporate governance. A few
years later, this prediction seemed premature. The junk bond （垃圾债
券） market crashed; a large number of high profile leveraged buyouts
resulted in default and bankruptcy; and leveraged buyouts of public
companies (so called public-to-private transactions) virtually
disappeared by the early 1990s.
A Guide to Funds in Cayman
The constitutive document for a company is its Memorandum
and Articles of Association （公司章程， aka by laws) and
ultimate management authority resides with a board of
directors( 董事会） , two of whom must be appointed for a
registered or licensed fund but neither of which need be
resident in Cayman.
Shares in a Cayman company can be issued as voting and/or
non-voting shares （有表决权 / 无表决权的股份） . Where
appropriate a company might issue non-voting shares to its
investors and issue voting shares only to its investment manager
in order to retain flexibility （保持灵活性） to make non-material
amendments （非实质性修正） to the fund structure without the
need to call a meeting of all the investors.
Segregated portfolio companies （分离投资组合公司；隔离组合公
司） benefit from statute based segregation of assets and
liabilities between the segregated portfolios of the company and its
general assets. Whilst conceptually similar to classes or series of
shares with statutory segregation the segregated portfolios can
also be split into classes or series of shares for the purpose of
differing fee allocations, investment objectives, liquidity provisions,
target investors or other matters.
Unit trusts are contractual arrangements created under a deed
or declaration of trust (the “Trust Deed”) made either by the
trustee （受托人） alone or between the manager and the
trustee. Unit trusts do not have their own legal personality and
contracts are entered into （签约） by the trustee in its
capacity as trustee of the trust. In certain circumstances the
power to enter into contracts on behalf of the trust can be
delegated to the manager.
 监管人
配售代
理人

经纪商
Thanks for Listening