International Company Law - 610055
Final Examination
Tilburg University Law School
Prof. Dr. J.A. McCahery
Out: Thursday, December 12, 2013
In: Wednesday, December 18, 2013; before noon (no excuses without receipt)
Send exam paper to: Email:
Deliver exam paper in hard copy in room M 821 (Montesquieu building, 8th floor, M 821)
INSTRUCTIONS
1. This is a TAKE-HOME exam. You are permitted to consult the course readings (course book and
articles located on Blackboard), lecture slides, finance dictionary and any other source handed out in
class.
2. Do be sure to support and substantiate your answers. Your answers may reference personal
experiences in addition to the materials listed under 1.
3. When submitting the answers to the exam, you are requested to write your NAME and
ANR NUMBER on top of each page of your text.
4. You need not worry about margins, fonts, etc as long as your work is legible. However, do not use
a font size smaller than 11 or larger than 13.
5. You are limited to a maximum of 15 single space pages, and 12 powerpoint slides for the
Sprint/Clearwire Answers. Please number the pages of your text. If you handwrite your answers,
please write in blue or black ink.
6. In general, do not copy sentences from the material or from any other source to form your answers
to the questions. Use your own words to express your understanding of the issue.
7. If you need to use a quotation from some source as a foundation for your ideas, the quotation must
be designated as a quotation in your answer.
8. Discuss all relevant issues even if you believe that your analysis of one of issue would by itself be
sufficient to dispose of the question.
8. The examination is divided into three parts. The relative weight of each part in the final grade is
indicated.
9. If any problems or questions arise during the exam, you are welcome to contact me at:
.
10. Good luck!
1
, PART I
[10 percent]
Identification and Significance
There follows a list of twelve terms and concepts, each of which bears on M&A discussions. Identify
and describe the significance in the context of International Company Law (giving examples from
this course as necessary) of SIX the twelve.
1. earnout agreement
2. poison pill
3. control premium
4. warranties
5. MAC clause
6. walkaway rights
7. minimum exchange ratio
8. spin-offs
9. leveraged buyout
10. enhanced scrutiny
11.pre-bid defenses
12. escrow accounts
2
, PART II
[40 percent]
Discuss the Quote
There are a series of quotations, some of which have been taken from readings assigned in this course.
They are grouped into two units labelled Subpart A and Subpart B. You are to take up BOTH
subparts. Subpart A contains two quotations and Subpart B contains one quotation. You are to answer
both quotations in Subpart A. You are to discuss the quotation in Subpart B.
Subpart A
Answer the questions that arise from the two quotations below. Critically discuss the implications of
the views expressed in the quotation, bringing to bear points raised and materials assigned in this
course.
1. “A ‘go-shop’ is a provision in a merger agreement that permits a target company, after executing a
merger agreement, to continue to actively solicit bids and negotiate with other potential bidders for a
defined period of time. Where a target has engaged in a fulsome pre-signing market canvass, a go-
shop has little or no utility. However, when a target has not undertaken any form of pre-signing
market canvass before signing up a deal (typically either because the buyer professed an
unwillingness to bid if the target commences a market canvass or because the target was concerned
that an auction process would result in employee and/or customer defections; 2), a go-shop
theoretically should produce the best possible transaction for the target company and its
stockholders”. Explain how using a go-shop clause has transformed M&A deal-making. To be sure, a
number of critics are skeptical of go shop provisions. Explain the circumstances when go-shops are
likely to be beneficial, and when they might be nothing more than mere window dressing. Discuss
whether the empirical evidence confirms the purported benefits of go-shop provisions.
2. “The European Commission’s review of the Takeover Directive commenced five years after the
transposition deadline of April 2006. The aim of the European Commission’s review was to examine
the Takeover Directive in light of the experience gained in applying it and, if necessary, propose
revisions. In June 2012, the European Commission published a report on the application of the
Takeover Directive, identifying a number of key areas where the Takeover Directive would benefit
from review”. Given the limited scope of the European Commission’s review (and its eventual final
report), discuss the most critical shortcomings of the Takeover Directive and how it might be best
reformed. Give examples from the readings to support your answer.
3
Final Examination
Tilburg University Law School
Prof. Dr. J.A. McCahery
Out: Thursday, December 12, 2013
In: Wednesday, December 18, 2013; before noon (no excuses without receipt)
Send exam paper to: Email:
Deliver exam paper in hard copy in room M 821 (Montesquieu building, 8th floor, M 821)
INSTRUCTIONS
1. This is a TAKE-HOME exam. You are permitted to consult the course readings (course book and
articles located on Blackboard), lecture slides, finance dictionary and any other source handed out in
class.
2. Do be sure to support and substantiate your answers. Your answers may reference personal
experiences in addition to the materials listed under 1.
3. When submitting the answers to the exam, you are requested to write your NAME and
ANR NUMBER on top of each page of your text.
4. You need not worry about margins, fonts, etc as long as your work is legible. However, do not use
a font size smaller than 11 or larger than 13.
5. You are limited to a maximum of 15 single space pages, and 12 powerpoint slides for the
Sprint/Clearwire Answers. Please number the pages of your text. If you handwrite your answers,
please write in blue or black ink.
6. In general, do not copy sentences from the material or from any other source to form your answers
to the questions. Use your own words to express your understanding of the issue.
7. If you need to use a quotation from some source as a foundation for your ideas, the quotation must
be designated as a quotation in your answer.
8. Discuss all relevant issues even if you believe that your analysis of one of issue would by itself be
sufficient to dispose of the question.
8. The examination is divided into three parts. The relative weight of each part in the final grade is
indicated.
9. If any problems or questions arise during the exam, you are welcome to contact me at:
.
10. Good luck!
1
, PART I
[10 percent]
Identification and Significance
There follows a list of twelve terms and concepts, each of which bears on M&A discussions. Identify
and describe the significance in the context of International Company Law (giving examples from
this course as necessary) of SIX the twelve.
1. earnout agreement
2. poison pill
3. control premium
4. warranties
5. MAC clause
6. walkaway rights
7. minimum exchange ratio
8. spin-offs
9. leveraged buyout
10. enhanced scrutiny
11.pre-bid defenses
12. escrow accounts
2
, PART II
[40 percent]
Discuss the Quote
There are a series of quotations, some of which have been taken from readings assigned in this course.
They are grouped into two units labelled Subpart A and Subpart B. You are to take up BOTH
subparts. Subpart A contains two quotations and Subpart B contains one quotation. You are to answer
both quotations in Subpart A. You are to discuss the quotation in Subpart B.
Subpart A
Answer the questions that arise from the two quotations below. Critically discuss the implications of
the views expressed in the quotation, bringing to bear points raised and materials assigned in this
course.
1. “A ‘go-shop’ is a provision in a merger agreement that permits a target company, after executing a
merger agreement, to continue to actively solicit bids and negotiate with other potential bidders for a
defined period of time. Where a target has engaged in a fulsome pre-signing market canvass, a go-
shop has little or no utility. However, when a target has not undertaken any form of pre-signing
market canvass before signing up a deal (typically either because the buyer professed an
unwillingness to bid if the target commences a market canvass or because the target was concerned
that an auction process would result in employee and/or customer defections; 2), a go-shop
theoretically should produce the best possible transaction for the target company and its
stockholders”. Explain how using a go-shop clause has transformed M&A deal-making. To be sure, a
number of critics are skeptical of go shop provisions. Explain the circumstances when go-shops are
likely to be beneficial, and when they might be nothing more than mere window dressing. Discuss
whether the empirical evidence confirms the purported benefits of go-shop provisions.
2. “The European Commission’s review of the Takeover Directive commenced five years after the
transposition deadline of April 2006. The aim of the European Commission’s review was to examine
the Takeover Directive in light of the experience gained in applying it and, if necessary, propose
revisions. In June 2012, the European Commission published a report on the application of the
Takeover Directive, identifying a number of key areas where the Takeover Directive would benefit
from review”. Given the limited scope of the European Commission’s review (and its eventual final
report), discuss the most critical shortcomings of the Takeover Directive and how it might be best
reformed. Give examples from the readings to support your answer.
3
