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  • Module 3 Review Problem Set PDF

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    Dhruv Kapoor
    15 vizualizări4 pagini
    The document contains a series of review questions about investments in a company called XYZ. It provides details on the amounts, terms, and security types for various investors over multiple funding rounds. It then asks a series of multiple choice questions about calculating dividend payouts, ownership percentages, return preferences, and proceeds from an acquisition of XYZ for $65 million.

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    The document contains a series of review questions about investments in a company called XYZ. It provides details on the amounts, terms, and security types for various investors over multiple funding rounds. It then asks a series of multiple choice questions about calculating dividend payouts, ownership percentages, return preferences, and proceeds from an acquisition of XYZ for $65 million.

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    © All Rights Reserved
    Descărcați ca PDF, TXT sau citiți online pe Scribd
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    15 vizualizări4 pagini

    Module 3 Review Problem Set PDF

    Încărcat de

    Dhruv Kapoor
    The document contains a series of review questions about investments in a company called XYZ. It provides details on the amounts, terms, and security types for various investors over multiple funding rounds. It then asks a series of multiple choice questions about calculating dividend payouts, ownership percentages, return preferences, and proceeds from an acquisition of XYZ for $65 million.

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    © All Rights Reserved
    Descărcați ca PDF, TXT sau citiți online pe Scribd
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    din 4

    MODULE

    3 REVIEW QUESTIONS

    Problem 1

    Investor A invests in XYZ and receives Convertible Preferred shares with a cumulative
    dividend. What does XYZ owe Investor A for the accrued Dividends?


    Investment Amount $4,800,000
    Dividend 12%
    # of Years 4
    Equity Ownership 32%

    A.
    $576,000
    B. $6,144,000
    C. $1,536,000
    D. $2,304,000
    E. $2,112,000


    Problem #2

    Investment $4,500,000 $1,750,000 $600,000 $10,000
    Security Participating Participating Convertible Common
    Return
    Pref. 2 1.5 1 0
    Years Held 4 6 8 9
    Cumm. Div. 12% 10% 8% 0%
    Founders 2,000,000
    Angel Group 850,000
    Series A
    650,000
    Series B 500,000


    ACQUISITION PRICE:

    $65,000,000


    1. What will the Series A Investor receive in the form of a Return Preference?

    A.
    $1,000,000
    B. $975,000
    C. $12,225,000
    D. $2,625,000
    E. $2,160,000

    1

    2. What will the Series B Investor Receive in
    Dividends?

    A.
    $1,050,000
    B. $2,160,000
    C. $1,920,000
    D. $1,080,000
    E. $525,000


    3. What percentage of shares does the Angel Class
    own?

    A.
    21.25%
    B. 50.00%
    C. 16.25%
    D. 12.50%
    E. 32.50%

    4. What are the total return
    preferences?

    (Assuming Angel Group acts in its best interest)

    A.
    $9,000,000
    B. $1,000,000
    C. $11,625,000
    D. $975,000
    E. $12,225,000

    5. What are the total dividends that will be paid out?

    A.
    $1,920,000
    B. $1,080,000
    C. $525,000
    D. $1,050,000
    E. $3,594,000






    2
    6. What will be the net proceeds available to the common
    shareholders?
    (Assuming Angel Group acts in its best interest)

    A.
    $49,181,000
    B. $46,187,000
    C. $47,156,000
    D. $49,781,000
    E. $52,406,000

    7. How much will the Founders receive from this transaction?

    A.
    $10,578,463
    B. $24,890,500
    C. $8,089,413
    D. $6,222,625
    E. $14,934,300

    8. How much will the Series B Investor receive from this
    transaction?

    A.
    $24,890,500
    B. $10,962,463
    C. $11,764,413
    D. $17,382,625
    E. $9,000,000

















    3
    Problem #3

    Investment $4,500,000 $1,750,000 $600,000 $10,000
    Security Participating Participating Convertible Common
    Return
    Pref. 2 1.5 1 0
    Years Held 4 6 8 9
    Cumm. Div. 12% 10% 8% 0%
    Founders 2,000,000
    Angel Group 850,000
    Series A
    650,000
    Series B 500,000

    Suppose that a Series C investor is seeking to invest $5,000,000 @ 6.50 per share.

    If the Series B investor has Full Ratchet Anti-Dilution, how many more shares will it
    receive?

    _________________________


    If the Series B investor has Weighted Average Anti-Dilution, how many more shares
    will it receive?

    _________________________


















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