Share
Explore BrainMass

Payoff after stage-2 financing

Enter formulas to solve the requirements of this problem

The payoffs in year 5 to George Pickwick and First Cookham are as follows:

First Cookham buys 2 million shares at $1

Company value in 5 years
After stage-2 financing
Payoff to: $2,000,000 $12,000,000
G. Pickwick FORMULA FORMULA
First Cookham FORMULA FORMULA

First Cookham buys 1 million shares now and invests an additional $1 million in shares in year 5

Company value in 5 years
After stage-2 financing
$2,000,000 $12,000,000
Company value in 5 years before issue of
$1 million in 2nd stage financing $1,000,000 $11,000,000
Price per share FORMULA FORMULA
Number of new shares issued to First Cookham #DIV/0! #DIV/0!
Total shares outstanding #DIV/0! #DIV/0!
Total shares owned by First Cookham FORMULA FORMULA
Percentage of all shares owned by First Cookham FORMULA FORMULA
Percentage of all shares owned by G. Pickwick #DIV/0! #DIV/0!

Payoff to:
First Cookham FORMULA FORMULA
G. Pickwick FORMULA FORMULA

Solution Summary

The solution explains how to calculate the payoff subsequent to stage-2 financing

$2.19