| As a contractual arrangement between the parties in equity investment,the valuation adjustment mechanism(“VAM”)can effectively solve the problem of valuation dilemma.While being widely used,the series of issues surrounding the VAM are also continuing to ferment.“Haifu Case”,as the first case in terms of VAM,initiated a wide discussion between the academic and practical circles,especially focusing on the identification of VAM’ s nature and effectiveness analysis of the clause,and once produced the interpretation of “effective against the shareholders and invalid against the company”,but still with no conclusion.In September 2018,the Supreme People’s Court regarded the guarantee clause related to the target company as effective in “Hanlin Case”,which seemed to provide a new path to pull the company into the gambling situation.In practice,the confrontation between the two parties is carried out at a more specific level of performance such as “how to determine the price of the share repurchase”,“whether the form of the guarantee is valid” and “whether the cash compensation agreement is fair”,forcing the court to provide more specific judgment regulations.Based on 101 reference cases heard by courts at various levels as of November30,2018,this paper conduct the statistics and type analysis of judicial practice.Basedon the 149 listed companies in the IPO Feedback and Audit Opinion Compilation(“Compilation”)(March 9,2017 edition),a detailed analysis of the security supervision is carried out,and the specific disclosure requirements of the CSRC were summarized in Chapter IV.Under the arbitration cases publicly available at the current stage,the case analysis of arbitration practice is carried out.The attitude in arbitrations is more tolerant than the judicial practice,and though the regulatory authorities have the rigid supervision policy,the arbitration centers do not impose the negative evaluation on the VAM.In addition,this paper also introduces Deep-Rock Doctrine in common law system,in order to achieve the substantial fairness in settlement of the company’s internal and external creditor’s rights,for the purpose of providing experience for our current application.This paper is divided into five Chapters.Chapter I is the overview,which briefly analyzes the definition and types of the VAM and reasons for its occurrence.Considering that there is no Chinese-styled VAM in the major Anglo-American countries,it further compares the main differences between the domestic and foreign legal practice,especially classified shares.Chapter II states the nature of the VAM,mainly from the two dimensions,theoretical controversy and practical controversy.As to theories,the main theories include conditional contract theory,fortunate contract theory,guarantee contract theory,and option contract theory.As to practice,judicial judgments mainly focus on whether the VAM is a loan contract or an equity investment contract.Chapter III is an empirical comparative analysis of the effectiveness of the VAM,from judicial practice and arbitration practice in China,as well as the relevant alternative legal practice abroad.The judicial practice is based on101 cases heard by courts at various levels from November 2009 to November 2018.The arbitration practice is analyzed from specific cases,in order to clarify the latest practice tendency.Under the relevant alternative foreign practice,Deep-Rock Doctrine in common law system is applied for analysis.Chapter IV states the analysis on the legal supervision in terms of the VAM,including the dual supervision in the field by securities law and corporate law.As for securities law regulation,this papersummarizes 149 companies in the Compilation and further clarifies the main regulatory points.As for corporate law regulation,the analysis is combined with the fundamental regulations and principles of corporate law.Chapter V puts forward suggestions for improvement from the three levels,judicial practice,corporate law regulation,security law regulation.Finally,in the conclusion part,this paper summarized the whole research process and main research conclusions. |
