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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Washington, D.C. 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>__________________________________________
</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CURRENT REPORT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>PURSUANT TO SECTION 13 OR 15(d) OF THE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SECURITIES EXCHANGE ACT OF 1934</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Date of Report (Date of earliest event reported):
September 7, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 112.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><U>CHINA MEDICINE CORPORATION</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Exact name of Registrant as specified in
Charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center; border-bottom: Black 1pt solid; width: 32%">Nevada</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center; width: 1%">&nbsp;</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center; border-bottom: Black 1pt solid; width: 32%">000-51379</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center; width: 1%">&nbsp;</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center; border-bottom: Black 1pt solid; width: 32%">51-0539830</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center">(State or other Jurisdiction of Incorporation)</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center">(Commission File Number)</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: -13.5pt; padding-left: 5.4pt; text-align: center">(IRS Employer Identification No.)</TD></TR>
</TABLE>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" ALIGN="CENTER" STYLE="font: 10pt Times New Roman, Times, Serif; width: 60%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">2/F, Guangri Tower</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">No. 9 Siyounan Road 1st Street</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Yuexiu District</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Guangzhou, China 510600</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Address of Principal Executive offices
and zip code)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" ALIGN="CENTER" STYLE="font: 10pt Times New Roman, Times, Serif; width: 50%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt; text-align: center">(8620) 8739-1718 and (8620) 8737-8212</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Registrant&rsquo;s telephone number, including
area code)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font-family: Wingdings">&#168;</FONT>&nbsp;Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font-family: Wingdings">&#168;</FONT>&nbsp;Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR 240. 14a-12)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-align: justify; text-indent: -13.5pt"><FONT STYLE="font-family: Wingdings">&#168;</FONT>&nbsp;Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-align: justify; text-indent: -13.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-align: justify; text-indent: -13.5pt"><FONT STYLE="font-family: Wingdings">&#168;</FONT>&nbsp;Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-align: justify; text-indent: -13.5pt">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-align: justify; text-indent: -13.5pt">&nbsp;</P>

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<TR STYLE="vertical-align: top">
    <TD STYLE="width: 12%; font-size: 10pt; font-weight: bold">Item 8.01</TD>
    <TD STYLE="width: 88%; font-size: 10pt; font-weight: bold">Other Events.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As previously disclosed, on January 29,
2010, China Medicine Corporation, a Nevada corporation (the &ldquo;Company&rdquo;), issued 4,000,000 shares of its common stock,
par value $0.0001 per share (&ldquo;Common Stock&rdquo;), at $3.00 per share, and 1,920,000 shares of its Redeemable Convertible
Preferred Stock, par value $0.0001 per share (&ldquo;Preferred Stock&rdquo;), at $30.00 per share to OEP CHME, LLC, a Delaware
limited liability company (&ldquo;OEP&rdquo;), in exchange for gross proceeds to the Company of $69,600,000, pursuant to a Stock
Subscription Agreement (as amended, the &ldquo;Subscription Agreement&rdquo;), by and among the Company, OEP and Senshan Yang,
the Company&rsquo;s Chief Executive Officer, dated December 31, 2009. Concurrently with the closing of the transactions contemplated
by the Subscription Agreement, $57,600,000 of the gross proceeds was deposited into an escrow account with JPMorgan Chase Bank
N.A. The escrow funds were subsequently allocated among escrow accounts in Hong Kong and Guangzhou, China.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 7, 2012 the Company received
a redemption notice (&ldquo;Redemption Notice&rdquo;) from OEP notifying the Company that OEP has requested that the Hong Kong
branch of JPMorgan Chase Bank, N.A., the Company&rsquo;s Hong Kong based escrow agent (the &ldquo;Hong Kong Escrow Agent&rdquo;),
distribute to OEP RMB240,607,814.14 (US$37,764,913) (the &ldquo;Redemption Amount&rdquo;), which was held in escrow as of the date
of the Redemption Notice pursuant to the Subscription Agreement and an escrow agreement, by and among the Company, OEP, and the
Hong Kong Escrow Agent, dated May 16, 2011 (the &ldquo;Hong Kong Escrow Agreement&rdquo;). The Redemption Notice states that upon
receipt of the Redemption Amount by OEP from the Hong Kong Escrow Agent, OEP shall surrender to the Company an aggregate of 1,130,744
shares of Preferred Stock for redemption. Pursuant to the Hong Kong Escrow Agreement and Section 4 of the Company's Certificate
of Designation, Rights and Preferences for the Preferred Stock which was filed with the Nevada Secretary of State on January 26,
2010 (the &ldquo;Certificate of Designation&rdquo;) a certificate authorizing the disbursement of all the funds held by the Hong
Kong Escrow Agent as of the date of the Redemption Notice was transmitted by OEP to the Hong Kong Escrow Agent on September 7,
2012, the same day the Company received the Redemption Notice. Following the completion of the redemption, OEP shall own 42.7%
of the issued and outstanding shares of Common Stock of the Company on a fully-diluted basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The redemption is taking place pursuant
to Section 4 of the Certificate of Designation, which provides for the redemption of the shares of Preferred Stock by the Company
upon a written request by the holder of the shares of Preferred Stock in accordance with Section 4.11 of the Subscription Agreement.
In accordance with the Certificate of Designation, the shares of Preferred Stock surrendered to the Company for redemption shall
be cancelled.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">According to Section
4.11 of the Subscription Agreement, the number of shares of Preferred Stock that OEP is required to surrender to the Company upon
receipt of the Redemption Amount shall be equal to X, where:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">X = Y / Z</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">Where:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">X = the number of shares
of Preferred Stock to be delivered to the Company by OEP</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">Y = the Redemption Amount</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">Z = ((1.042)<SUP>a</SUP>
* US$30) where &ldquo;a&rdquo; is a fraction, the numerator of which is the number of days passed from the closing of the transaction
contemplated by the Subscription Agreement to date of determination and the denominator of which is 365.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As set forth in the
Redemption Notice, &ldquo;a&rdquo; is equal to 952/365 and therefore Z is equal to approximately $33.40.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Redemption Notice
also notified the Company that OEP intends to request, that the Guangzhou branch of JPMorgan Chase Bank, the Company&rsquo;s Guangzhou,
China based escrow agent (the &ldquo;Guangzhou Escrow Agent&rdquo;) distribute to OEP an additional RMB35,073,482.94 on a date
to be determined by OEP (which shall in no event be earlier than September 30, 2012) and notify the Guangzhou Escrow Agent in accordance
with Section 4.11 of the Subscription Agreement and an Escrow Agreement, by and among Guangzhou Konzern Medicine Co., Ltd., a subsidiary
of the Company, OEP, and the Guangzhou Escrow Agent, dated January 31, 2012, and that upon receipt of RMB35,073,482.94 OEP shall
surrender to the Company the number of shares of Preferred Stock determined as set forth in the Redemption Notice.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



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<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2">CHINA MEDICINE CORPORATION</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; width: 50%">&nbsp;</TD>
    <TD STYLE="width: 4%">By:&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 46%">/s/ Senshan Yang</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD>Name:&nbsp;&nbsp;&nbsp;<BR>
Title:</TD>
    <TD STYLE="vertical-align: top; border-top: #000000 1px solid">Senshan Yang<BR>Chief Executive
Officer</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: 0pt; margin-top: 0pt; margin-bottom: 6pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: 0pt; margin-top: 0pt; margin-bottom: 6pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Date: September 13, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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[{"type": "8-K", "sequence": "1", "filename": "v323691_8k.htm", "description": "FORM 8-K", "secsgml_size_bytes": 19450}]
{"company-data": {"conformed-name": "CHINA MEDICINE CORP", "cik": "0001328790", "assigned-sic": "5122", "irs-number": "000000000", "state-of-incorporation": "NV", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-51379", "film-number": "121090791"}, "business-address": {"street1": "GUANGRI TOWER, SUITE 702", "street2": "NO. 8 SIYOU SOUTH 1ST STREET", "city": "YUEXIU DISTRICT , GUANGZHOU,", "state": "F4", "zip": "510600", "phone": "(8620) 8739-1718"}, "mail-address": {"street1": "GUANGRI TOWER, SUITE 702", "street2": "NO. 8 SIYOU SOUTH 1ST STREET", "city": "YUEXIU DISTRICT , GUANGZHOU,", "state": "F4", "zip": "510600"}, "former-company": {"former-conformed-name": "LOUNSBERRY HOLDINGS III INC", "date-changed": "20050531"}}
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
September 7, 2012
CHINA MEDICINE CORPORATION
(Exact name of Registrant as specified in
Charter)
Nevada
000-51379
51-0539830
(State or other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
2/F, Guangri Tower
No. 9 Siyounan Road 1st Street
Yuexiu District
Guangzhou, China 510600
(Address of Principal Executive offices
and zip code)
(8620) 8739-1718 and (8620) 8737-8212
(Registrant's telephone number, including
area code)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨
Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR 240. 14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 8.01
Other Events.
As previously disclosed, on January 29,
2010, China Medicine Corporation, a Nevada corporation (the "Company"), issued 4,000,000 shares of its common stock,
par value $0.0001 per share ("Common Stock"), at $3.00 per share, and 1,920,000 shares of its Redeemable Convertible
Preferred Stock, par value $0.0001 per share ("Preferred Stock"), at $30.00 per share to OEP CHME, LLC, a Delaware
limited liability company ("OEP"), in exchange for gross proceeds to the Company of $69,600,000, pursuant to a Stock
Subscription Agreement (as amended, the "Subscription Agreement"), by and among the Company, OEP and Senshan Yang,
the Company's Chief Executive Officer, dated December 31, 2009. Concurrently with the closing of the transactions contemplated
by the Subscription Agreement, $57,600,000 of the gross proceeds was deposited into an escrow account with JPMorgan Chase Bank
N.A. The escrow funds were subsequently allocated among escrow accounts in Hong Kong and Guangzhou, China.
On September 7, 2012 the Company received
a redemption notice ("Redemption Notice") from OEP notifying the Company that OEP has requested that the Hong Kong
branch of JPMorgan Chase Bank, N.A., the Company's Hong Kong based escrow agent (the "Hong Kong Escrow Agent"),
distribute to OEP RMB240,607,814.14 (US$37,764,913) (the "Redemption Amount"), which was held in escrow as of the date
of the Redemption Notice pursuant to the Subscription Agreement and an escrow agreement, by and among the Company, OEP, and the
Hong Kong Escrow Agent, dated May 16, 2011 (the "Hong Kong Escrow Agreement"). The Redemption Notice states that upon
receipt of the Redemption Amount by OEP from the Hong Kong Escrow Agent, OEP shall surrender to the Company an aggregate of 1,130,744
shares of Preferred Stock for redemption. Pursuant to the Hong Kong Escrow Agreement and Section 4 of the Company's Certificate
of Designation, Rights and Preferences for the Preferred Stock which was filed with the Nevada Secretary of State on January 26,
2010 (the "Certificate of Designation") a certificate authorizing the disbursement of all the funds held by the Hong
Kong Escrow Agent as of the date of the Redemption Notice was transmitted by OEP to the Hong Kong Escrow Agent on September 7,
2012, the same day the Company received the Redemption Notice. Following the completion of the redemption, OEP shall own 42.7%
of the issued and outstanding shares of Common Stock of the Company on a fully-diluted basis.
The redemption is taking place pursuant
to Section 4 of the Certificate of Designation, which provides for the redemption of the shares of Preferred Stock by the Company
upon a written request by the holder of the shares of Preferred Stock in accordance with Section 4.11 of the Subscription Agreement.
In accordance with the Certificate of Designation, the shares of Preferred Stock surrendered to the Company for redemption shall
be cancelled.
According to Section
4.11 of the Subscription Agreement, the number of shares of Preferred Stock that OEP is required to surrender to the Company upon
receipt of the Redemption Amount shall be equal to X, where:
X = Y / Z
Where:
X = the number of shares
of Preferred Stock to be delivered to the Company by OEP
Y = the Redemption Amount
Z = ((1.042)
a
* US$30) where "a" is a fraction, the numerator of which is the number of days passed from the closing of the transaction
contemplated by the Subscription Agreement to date of determination and the denominator of which is 365.
As set forth in the
Redemption Notice, "a" is equal to 952/365 and therefore Z is equal to approximately $33.40.
The Redemption Notice
also notified the Company that OEP intends to request, that the Guangzhou branch of JPMorgan Chase Bank, the Company's Guangzhou,
China based escrow agent (the "Guangzhou Escrow Agent") distribute to OEP an additional RMB35,073,482.94 on a date
to be determined by OEP (which shall in no event be earlier than September 30, 2012) and notify the Guangzhou Escrow Agent in accordance
with Section 4.11 of the Subscription Agreement and an Escrow Agreement, by and among Guangzhou Konzern Medicine Co., Ltd., a subsidiary
of the Company, OEP, and the Guangzhou Escrow Agent, dated January 31, 2012, and that upon receipt of RMB35,073,482.94 OEP shall
surrender to the Company the number of shares of Preferred Stock determined as set forth in the Redemption Notice.
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
CHINA MEDICINE CORPORATION
By:
/s/ Senshan Yang
Name:
Title:
Senshan Yang
Chief Executive
Officer
Date: September 13, 2012