Study On VAM In Privaty Equity Investment About Legal Validity And New Reasonable Regulation

Private Equity Investment Fund is a kind of financial arrangements, belong to one way of Equity Investment. Private equity is often used to introduce to the Strategic Investment, and it valuation adjustment mechanism is a form of self valuation mechanism in private, is also the most efficient institutional arrangement:on account of respect the self-rule of all subject, and in this way could ensure the efficient allocation of the property. Strategic Investors in private equity are usually asked to sign the investment agreement, also asked to provide a "Valuation Adjustment Mechanism" or require to agree in the investment agreement valuation adjustment mechanism, etc. Valuation Adjustment Mechanism is run as incentive means for financing sides (or Pre-IPO companies) to realize profit target, reduce the risk of information asymmetry, and safeguard the interests of the investors. There are several innovation points: VAM belongs to the Nameless Contract contain options content, and is a kind of investment tools (documents), and put forward to the way to solve obstacle in application of VAM are perfecting the system of Preferred Stock, Convertible Company Bonds and broaden the withdrawal mechanism for PE in Private Equity Investment.In practice, the fate of the valuation adjustment mechanism is differ, there are successful:Mengniu Milk case etc., also have failure case:Yongle Electronics, Shenzhen Nanshan Power, and Taizinai Group, etc. Therefore, for the legal attribute of valuation adjustment mechanism and its parse all the important terms and conditions of the law,The author will from the reality of Equity Investment in our country combined with the current civil and commercial legal system, and analysis of Private Equity Investment "Valuation Adjustment Mechanism" about it basic theories such as the legal basis, and the legal attribute of Valuation Adjustment Mechanism and the legitimacy of the elements, and then analyzes the enforcement recognition status in quo, finally, this paper discusses legitimate ways to solve obstacle in application of VAM, such as build systems of Preferred Stock, Convertible Bonds and withdrawal mechanism for PE.The paper is four partsThe first one:introduce the basic theory of Private Equity Funds and legal attribute, and discusses the law about Subject, Content and Object.The second one:discussing the Valuation Adjustment Mechanism of the legal about it constitutive requirement.The third one:starting the result of Valuation Adjustment Mechanism,and then analyzes the enforcement about it, discusses the reasons that constitutes the application of fundamental obstacles, and reach a decision by legal interpretation.The fourth one:it is comes to a conclusion that the legitimacy of the Valuation Adjustment Mechanism about legitimate ways to solve obstacle in application of VAM are perfecting the system of Preferred Stock, Convertible Company Bonds and broaden the withdrawal mechanism for PE in Private Equity Investment, etc.