Lahore University of Management Sciences

LAW 327 – Strategic International Commercial Transactions

Spring 2018

Instructor Khyzar Hussain

Room No. 1-12
Office Hours TBD
Email [email protected]
Telephone 5606
Secretary/TA TBD
TA Office Hours TBD
Course URL (if any) -

Course Basics
Credit Hours 4
Lecture(s) Nbr of Lectures per week 2 Duration 1 hr 50 m
Recitation/Lab (per Nbr of Lectures per week None Duration N/A
week)
Tutorial (per week) Nbr of Lectures per week None Duration N/A

Course Distribution
Core No
Elective BA/LLB
Open for Student BA/LLB
Category

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Close for Student Non-law students: Closed to All
Category

Course Description

This Course is designed to introduce the student to several types of the most frequently encountered types of commercial transactions and business
enterprises—including mergers and acquisitions, joint ventures, strategic alliances, international project finance, intellectual property licensing, and
international private equity and venture capital transactions.

Course Prerequisite(s)
There are no prerequisites for this course. Generally, a student for this class must be familiar with the operation of the legal system. Knowledge on
how to spot issues, to determine what facts are material for the operation of law, and logical analysis are presumed. Those topics are not reviewed
in any detail in this class.

Course Objectives
The focus of this course is the Pakistani Legal system, and the regimes that act as the framework in which certain international transactions occur.
The role of a lawyer in international transaction, coupled with drafting exercises shall be the major focus of this course. This course is targeted
towards lawyers, and other undergraduate students who are contemplating a career in international corporate law or business.

Learning Outcomes
The course shall progress by comparing and contrasting elements of major deal making processes common to international transactions, regardless
of the jurisdiction in play; however, specific interest shall be paid towards regulatory schemes in the Pakistani Legal System. The course shall
consider the types of hindrances and barriers trade deals, and certain transactions face, and shall appraise the elements that make a specific
transaction international in its nature. The course shall take a pragmatic approach towards understanding deal structuring, and common risks in
making deals; with an acute focus on how to limit those risks.

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Grading Breakup and Policy
Home Work: Reading the assigned material prior to class
Quiz (s): 20% (4 in number; unannounced)
Class Participation: 15%
Attendance: None (See Attendance Policy below)

Midterm Examination: 20%

Final Examination: 45% (Take Home: 48 hours)

• Attendance: Students are expected to attend all classes. The following Attendance Policy shall be enforced as per the Undergraduate
Student Handbook:
• any student who is more than 10 minutes late to class will be marked absent and may, at the instructor’s
discretion, be barred from
• sitting in that class; and,
• more than 3 unexcused absences will lead to a grade reduction. All requests to be absent from class must have
been approved by the instructor prior to the class in question.

• Class You are expected to read the assigned material prior to class to contribute meaningfully in class. Only a meaningful
Participation: contribution in class shall be cause for you to get credit.

• Examination: All examinations for this course are open book. All exam materials must be prepared in congruence with Article 22 of
the LUMS Undergraduate Handbook.
• Formative assessment shall be conducted through class discussions and quizzes that shall be conducted in class.
Points awarded shall count towards the final grade for this course.
• Summative assessment shall be through the Final Examination (date to be announced later).

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 • Pledge to All submissions for this class must be submitted with a signed pledge from the student stating that all the work being
accompany all submitted is the student’s own. Sample language of the pledge is stated below:
written
submissions for “I respectfully submit this written submission in good faith. I further pledge upon my sacred Honor, as a student
this class: engaged in the most noblest of pursuit of gaining a legal education, that I have not given, nor received, improper help
to aid in the completion of ALL my written submissions for this Course.”

• Electronic No electronic devices whatsoever are permitted to be used during the lectures. This includes laptops for note taking
Devices: purposes.

• Material: All necessary reading material for this course shall be presented in a Course Pack for this Course. However, on
occasion, handouts may also be provided to supplement the reading material in the Course Pack. All Materials for this
Course have been prepared by the Instructor.

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 • Quiz The Quizzes for this class shall be unannounced. These quizzes will generally be conducted in the first 15
minutes of class.

Examination Detail
Midterm Exam Yes/No: Yes
Combine/Separate: Combined; Grading separate
Duration: 90 minutes (1h 30m)
Preferred Date:
Exam Specifications: Open Book & Open Notes (Short questions and/or Multiple choice questions)
Final Exam Yes/No: Yes
Combine/Separate: Combined; Grading separate
Duration: 180 minutes (3h)
Exam Specifications: Take Home Exam; Open Book & Open Notes

Course Overview
Lecture Topics Recommended Readings Objectives/Application
1. Introduction to Course Pack Chapter 1 and 2 • Introduction to the Course
Strategic
International
Transactions

2. The Role of the Course Pack Chapter 3 • How to approach drafting commercial documents
International • The Role of a lawyer as a gatekeeper for business
Business Lawyer • Corporate forms and associated benefits
• Doing Deals Abroad (Focus on the MENA region)

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 • Representing Foreign concerns
• The Building Blocks of International Commercial
Relations -- the Alphabet Soup of Commonly
Encountered Domestic and International Business
Entities (Inc., LLC, S.A., A.G., GmbH, S.a.r.l.,
Societas Europeae, etc.)
• The Importance of Perspective: How Cultural
Differences Affect Business Negotiations

3. International • Lou R. Kling & Eileen T. Nugent, • Regulations impacting Mergers in different
Mergers and Negotiated Acquisitions of Companies, jurisdictions, including Pakistan.
Acquisitions (Part 1) Subsidiaries and Divisions, Law Journal • How to value a going concern.
Press (2014), Volume 1, Chapters 1 • Understanding the working parts of a transactions
• ABA Model Stock Purchase Agreement, • Understanding the necessary components of a
Second Edition, Ancillary Document B - contract.
- Letter of Intent. • Evaluate different transactional structures
• Sample Stock Purchase Agreement. • Stock Deals v. Asset Deals
• Sample Asset Acquisition Letter of • Structuring Transactions -- Forward and Reverse
Intent. Triangular Mergers
• Sample Stock and Asset Purchase • Dissecting the Documents: Covenants,
Agreement. Representations and Warranties, Conditions
• “Break-up or Termination Fees,” Precedent, Indemnification
Practical Law Company, Practice Note
6- 382-5500.
• “Reverse Break-up Fees and Specific
Performance” Practical Law Company,
Practice Note 8-386-5095.

4. International • See Readings from Week 3 • Case Studies : Consideration of various

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 Mergers and • Focus shall shift to Corporate Finance international merger transactions.
Acquisitions (Part 2) Techniques for raising revenue for
certain corporate ventures
• Course Pack
5. Joint Ventures, • Helen Deresky, International • The importance of foreign direct investment to a
Strategic Alliances Management: Managing Across Borders country.
and Foreign Direct and Cultures (Sixth Edition, 2008), pp. • Understanding timelines and incentives
Investment 203 – 240. • The working parts of joint venture agreements
• Peter D. Ehrenhaft, “International Joint • Choosing a Local Partner
Ventures: Setting Them Up, Taking • Pro's and Con's of Going it Alone
Them Apart,” 23 Int’l Quarterly 3 (July • The Importance of Due Diligence
2011). • Difference Between Mature Markets and Emerging
• Ralph H. Folsom; Michael Wallace Markets
Gordon; John A. Spanogle, Jr.; Peter L. • "Contractual" versus "Entity-Type" Joint Ventures
Fitzgerald, Principles of International • Shareholders' Agreement as the Magna Carta of
Business Transactions, Trade & Deals
Economic Relations, Thomson West
• Timeline of Joint Venture Establishment
(Third Edition, 2013), pp. 731 - 787.
• Financial Issues (GAAP versus IFRS)
• Sample Joint Venture Agreements. a)
• Business Realities of Dealing in Different
Domestic Pakistani Joint Venture
Geographical Markets
Forumlations. b) International. c)
Delaware LLC .
• PricewaterhouseCoopers, Similarities
and Differences: A Comparison of IFRS
and US GAAP (October, 2014)

6. Project Finance and • Readings: Ralph H. Folsom; Michael • How project finance works
Privatization Wallace Gordon; John A. Spanogle, Jr.; • The necessary parties and entities in a project
Peter L. Fitzgerald, & Michael P. Van finance transaction

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 Alstine, International Business • The use of the transaction in exploitation of natural
Transactions, A Problem Oriented resources
Coursebook, Twelfth Edition, Thomson • Risks associated with greenfield projects
West (2015), pp. 981- 1052. • Areas of Application
- Exploitation of Natural Resources
- Power Generation
- Transportation and Infrastructure
- Recourse v. Non-Recourse Financing
- Build-Operate-Transfer (BOT), and
- Build-Own-Operate-Transfer (BOOT)
• Models
• The Various Players
- Developers
- Private Banks
- International Financial Institutions and Regional
Development Banks
- Suppliers and Other Contractors
• The Interrelationship Between Debt and Equity
• Government Incentive Programs
• Political Risk Insurance (OPIC, MIGA)
• Special Considerations Regarding Privatization and
Public – Private Partnerships
• Understanding the Role of the State in Overseas
Jurisdictions

7. Entering the • Entering the United States Securities • How to value a company
Securities Markets Markets: A Guide for non-U.S. • What regulations need to be complied with before
Companies, PriceWaterhouseCoopers going public

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 Publication (2005). • Tax considerations
• Edward F. Greene, Edward J. Rosen, • Going public in foreign jurisdications
Leslie N. Silverman, Daniel A.
Braverman and Sebastian R. Sperber,
U.S. Regulation of the International
Securities and Derivatives Markets;
Tenth Edition, Aspen Publications
(2012), pp. 2-7 – 2-36; 5-3 – 5- 58. 3.
• Sample Equity Offering Memorandum.
• SEC Act of 1997

8. Private Equity and • Readings: 1. Steven N. Kaplan and Per • What is Private Equity?
Venture Capital Johan Strömberg, Leveraged Buyouts • Who are the Major Players
and Private Equity (June 2008), • Fun with Funds
available at • LBO's and MBO's
http://ssrn.com/abstract=1194962. • Mezzanine Investments
• Sample venture capital deal documents, • Convertible Preferred Stock
with annotations. • Investors' Rights Agreements
• Amended and Restated Certificate of • Co-Sale Agreements, Tag-Alongs and Drag-
Incorporation Alongs
• Preferred Stock and Warrant Purchase • Liquidation Preferences
Agreement • Antidilution Protection
• Amended and Restated Investors’ Rights • Down-Round Financings
Agreement
• Pay-to-Play Provisions
• Right of First Refusal and Co-Sale • Pro-Investor v. Pro-Entrepreneur Cultural
Agreement Environments
• Voting Agreement

9. Hedge Funds • What is a Hedge Fund?

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 • Readings: 1. Staff Report to the United • Hedge Funds vs. Private Equity
States Securities and Exchange • Illustrative Investment Strategies and Styles
Commission, Implications of the Growth • Legal Structures
of Hedge Funds, September 2003 • Disclosure and Documentation Regulation of
(Excerpts). Hedge Funds
• Sample Hedge Fund Private Placement
Memorandum. 3.
• Sample Hedge Fund Limited Liability
Company Agreement.
• The Billion Dollar Club – U.S. Hedge
Funds Managing Over a Billion Dollars
Worth of Assets as of the Beginning of
2010.

10. Licensing • Aaron Xavier Fellmeth, The Law of

Intellectual Property International Business Transactions, • "Hard" IP v. "Soft" IP
and Franchising Thomson West (Second Edition, 2011), • Relevant International Conventions and Treaties
Chapters 2-4 (pp. 25-206). (Paris, Berne, Madrid, Rome, TRIPS, etc.)
• Sample Cross-Border Trademark • Protection of Intellectual Property at Home and
License. Abroad

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11. (International) Tax • Readings: 1. Jerold A. Friedland,
Issues Understanding International Business • Pakistani. v. Foreign Taxes
and Financial Transactions, Fourth • Transfer Pricing
Edition, Lexis Nexis (2014), pp. 343 - • Foreign Tax Credits
377. • Withholding Taxes
• 2. U.S. - U.K. Bilateral Tax Treaty. • Tax Havens
• Bilateral Tax Treaties

12. Franchising • Course Pack

Agreements • Sample Franchising agreement provided • The cross border implications of an international
in class franchising agreement
• IP considerations
• Risks associated
• Parts of an agreement
• Exclusive – Non Exclusive licesning
13. Resolution of • Course Pack
Domestic and • Further readings • Arbitration Act
International - S.I. Strong, “Navigating the Borders • Other forms of dispute resolution
Disputes Between International Commercial • Contractual Language triggering compulsory
Arbitration and U.S. Federal Courts: A dispute resolution and pittfalls
Jurisprudential GPS,” 2012 Journal of • International Arbitration (ICC, AAA, LCIA,
Dispute Resolution 119 (2012). ICSID, Stockholm Chamber of Commerce)
- Gilles Cuniberti, “Beyond Contract— • Arbitration v. Litigation
The Case for Default Arbitration in • Choice of Law, Choice of Forum
International Commercial Disputes,” 32 • 1958 New York Convention on the Enforcement of
Fordham International Law Journal 417 Arbitral Awards

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 (2009). • 2005 Hague Convention on Choice of Court
- Shahla F. Ali, “Approaching the Global Agreements
Arbitration Table: Comparing the
Advantages of Arbitration as Seen by
Practitioners in East Asia and the West,”
28 Review of Litigation 791 (2009).

14. Issues in • Course Pack • Consideration of specific Project finance

International Project • Sessions are also intended to serve as transaction examples.
Finance, Corporate review of the course. • Introduction to methods of valuing companies
Finance and Review
of the Course

Textbook(s)/Supplementary Readings

To be decided.

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