Core Viewpoint - The article discusses the practical issues and solutions regarding the protection of existing shareholders' rights during subsequent financing rounds of invested companies, focusing on the review of transaction documents by existing shareholders [2]. Group 1: Key Points on Shareholder Agreement - The Shareholders Agreement (SHA) is a comprehensive document that outlines special rights, corporate governance, commitments, and obligations of shareholders, often including performance commitments, valuation adjustments, and rights such as preemptive rights and anti-dilution rights [3]. - Existing shareholders need to pay attention to the effectiveness of the new shareholder agreement, particularly whether it fully encompasses all special rights obtained during their initial investment and whether it includes any adjustments that may diminish their rights [4][5]. - If the new shareholder agreement replaces the old one, existing shareholders must ensure that all their rights are preserved; otherwise, unincorporated rights may not be protected [4][5]. Group 2: Common Changes in Rights Due to New Shareholder Agreement - Adjustments to repurchase rights may include changes in the order of repayment, the circumstances triggering repurchase, and the calculation of repurchase price, which could negatively impact existing shareholders [8][9]. - The introduction of new investors may lead to more favorable rights for them, such as enhanced repurchase rights or priority in liquidation, which existing shareholders must evaluate and potentially negotiate [8][13]. - Changes in the rights to appoint directors or access information may also occur, often based on the proportion of shares held, which existing shareholders should scrutinize [14]. Group 3: Key Points on Capital Increase Agreement - The Share Purchase Agreement (SPA) outlines the specific arrangements for capital increases, including conditions for closing and representations made by the invested company [15][16]. - Existing shareholders should ensure that the SPA does not impose unreasonable obligations on them, such as commitments that deviate from customary practices or that increase their liabilities [17]. Group 4: Key Points on Revised Company Articles - The revised company articles must align with the actual circumstances of the financing, ensuring that all necessary provisions are included and consistent with the shareholder agreement [18][19]. - Attention should be given to the provisions regarding the loss of rights due to overdue contributions, ensuring there are no conflicts with the capital increase agreement [20]. Group 5: Interconnection of Agreements - It is crucial for existing shareholders to ensure that the shareholder agreement, capital increase agreement, and company articles are consistent and do not contain conflicting provisions, which could lead to disputes over applicability and effectiveness [21].

Core Viewpoint - Guangdong Narui Radar Technology Co., Ltd. is planning to issue shares and pay cash to acquire 100% equity of Tianjin Sigma Microelectronics Co., Ltd. and raise supporting funds through a differentiated pricing scheme [1][2][3] Legal and Regulatory Framework - The law firm Guangdong Jingcheng Yueheng has been appointed as the legal advisor for the transaction, ensuring compliance with relevant Chinese laws and regulations, including the Company Law and Securities Law [1][4] - A supplementary legal opinion was issued in response to an inquiry from the Shanghai Stock Exchange regarding the transaction [2][3] Transaction Details - The transaction involves issuing shares and cash to acquire Tianjin Sigma Microelectronics, with a total valuation of 37 million yuan for the target company [9][15] - The transaction includes a differentiated pricing scheme based on investment costs, time, and agreement terms, allowing for varying valuations among different shareholders [9][12] Shareholder Dynamics - External shareholders, including Zhongxin Haihe and Junke No. 2, have agreed to a differentiated pricing arrangement, reflecting their investment costs and expected returns [11][16] - The pricing strategy aims to balance the interests of management shareholders and external investors, facilitating a quicker transaction process [14][16] Financial Performance and Market Context - The target company has shown significant growth, with a revenue increase of 42.83% in 2021 compared to 2020, and a net profit growth of 64.98% [15] - The global semiconductor market reached a record high of $555.9 billion in 2021, with China being the largest market, indicating a favorable environment for the transaction [15] Valuation and Pricing Analysis - The average premium for the transaction is 87.79% compared to discounted shareholders, while the overall asset pricing premium is 66.17%, which is within a reasonable range compared to market cases [15][16] - The pricing reflects a careful assessment of the target company's valuation, considering its operational performance and market conditions [15][16]