LAW 401 Companies Law Saudi Construction and Liability Protection
Order ID:89JHGSJE83839 Style:APA/MLA/Harvard/Chicago Pages:5-10 Instructions:
LAW 401 Companies Law Saudi Construction and Liability Protection
Q1
To assess your ability to:
Apply legal issues and concepts related to the duty of loyalty to create appropriate solutions in case study scenario.
Apply main concepts of Saudi Company law in case study scenario.
Saudi Construction Case Study:
Assad and three business associates have decided to start a business: Saudi Construction. They will do work for oil companies in Saudi Arabia at
first, but he hopes the firm will grow within two or three years to gain heavy construction contracts throughout the Middle East. Assad wonders
whether he should form a corporation, a partnership, or maybe a limited liability company under Saudi Companies Law.
Assad believes they will initially need about $10 million in capital to run the business and have sufficient financial reserves to do large-scale
projects. After two years, they will need an additional $20 million in capital.
Assad will be in charge of business operations. He realizes they need a business plan that will address how to value the corporation in order to
raise the necessary capital in two years. It also needs to address how Saudi Construction can legally protect its assets in an industry where
lawsuits are a common hazard.
Meanwhile, his associates have pressured Assad to kick-start the business by signing a couple of lucrative contracts right away; they tell him he
shouldn’t worry about the administrative paperwork. They say that nobody ever looks at the paperwork once a business is formed and its no big deal.
ACTION ITEMS
In a one-page paper, respond to ONE of the following important questions:
Assad has hired you as his business consultant to help him make good decisions. Give him advice on his questions:
What are the advantages and disadvantages of forming the business as?
a corporation?
a partnership?
a limited liability companies?
What is his potential liability as an individual and what can he do to limit his risk?
What issues might arise from following his business associates’ advice?
What other factors should he take under consideration?
OR select from one of the questions below:
In helping Assad with the business plan, explain:
How he can value his business
What the business can do to reduce its risk
How the owners can limit their liability
What the business should (and should not!) do to protect against lawsuits
What factors he must consider on how to raise capital
What mix of capital the business should have?
Q2
To assess your ability to:
Apply critical thinking skills to discern legal issues and create appropriate solutions in case study scenario.
Apply main concepts of Saudi Company law in case study scenario.
Saudi Construction Case Study:
Assad is very happy to report that Saudi Construction Inc. has grown significantly in the last three years through mergers and acquisitions. His family is so proud of him; he is a rich man. However, the problems of managing the business continue, but in different ways. Now, in the 5th of the business, there are still some minority shareholders from some of their acquisitions who make life difficult.
Assad’s industry friends tell him that the best thing to do is get rid of his problems by buying the minority shareholders out. Assad really likes that idea; it would make his life easier now and allow the majority shareholders (whom he controls) to make all the decisions without interference.
Some of Assad’s fellow corporate officers have been secretly talking at lunch about another idea. Why don’t the officers get together and do a management buyout (MBO)? Assad of course is interested because this would make him wealthy beyond all expectations. Of course, the officers will need to borrow a lot of money to do the buyout, but Assad hears there are ways to do it.
Yet trouble is always at the door. A number of the shareholders want to take control of Saudi Construction Inc. away from Assad’s group; they are unhappy with some of the acquisitions and the direction the corporation is going in. The shareholders are threatening a hostile tender offer. They want to go around the board of directors and go directly to shareholders. How can they do that? Assad needs to understand all the tactics these shareholders will employ in a hostile tender offer. More importantly, Assad is a man of action. What can he do to prevent it? If the hostile shareholders want a fight, Assad is prepared to fight. He didn’t work this hard to lose control of Saudi Construction now!
Assad’s friends have told him if he really wants to fight, he must be ruthless. He must create a “poison pill” to make his company’s stock less attractive and thwart the hostile takeover.
(You may refer back to Case Study Scenarios #1 and #2 as needed.)
ACTION ITEMS
In a one-page paper, respond to ONE of the following important questions:
Your consulting business has done very well, particularly since you have successful clients like Saudi Construction, Inc. You are sitting at the pool when you receive an urgent call from Assad. He always has grand ideas he got from his friends, but he is smart enough to get your professional opinion before he takes action.
Assad wants to know right away about getting rid of the troublesome shareholders. Some of his friends have called it a “freezeout”. He is also very concerned about a threatening hostile tender offer, and needs to know how how he can stop it. He wants to know all the ways his enemies might make succeed with the hostile offer. Assad can be a brutal businessman, so he also wants to know all about a poison pill and is prepared to put plenty of poison in it if it will stop the hostile tender offer.
Assad hates to hear about all this legal stuff, but he wants you to tell him the ways the Board of Directors can handle things fairly (or fairly enough that the courts will approve). Are there ways to he can make sure it is “legal” to get rid of shareholders without losing a lawsuit? You have lawyers in your consulting team, so he wants to know his options, in reasonably simple terms.
But Assad also want to understand the management buyout (MBO). Secretly, of course; you are to tell no one about the plan. Assad knows you are on vacation, but he doesn’t care. He has made you rich. He wants answers now. You leave the pool and head up to your room. It’s time to get to work.
SUBMISSION INSTRUCTIONS
Referencing and in-text citation APA, without plagiarism.
Times New Roman (size 12, double-spaced)
The answer to question should not be less than 250 words
Make references for each question separate
LAW 401 Companies Law Saudi Construction and Liability Protection
RUBRIC
Excellent Quality
95-100%
Introduction 45-41 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Literature Support
91-84 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Methodology
58-53 points
Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met.
Average Score
50-85%
40-38 points
More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided.
83-76 points
Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration.
52-49 points
Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met.
Poor Quality
0-45%
37-1 points
The background and/or significance are missing. No search history information is provided.
75-1 points
Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration.
48-1 points
There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met
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LAW 401 Companies Law Saudi Construction and Liability Protection