Consider Schembri Specialists (SS), a start-up marketing company which offers creative marketing solutions for small family owned businesses. SS has no debt and the founders of SS own all existing12mshares of common stock in the firm.After demonstrating some initial success, the founders of SS are looking for additional investment from various different venture capitalists.They plan to raise 20m, which if successful, will increase SS's current valuation toV0=60m.Initially, the founders of SS contact Okat Ventures. Okat Ventures agrees to invest in return for 4mconvertible preferred shares (CP) with liquidation preference equal to 20m. Throughout this question you should assume =0.8 and r=0.025.

Question:What is Okat Ventures' conversion condition? What is Okat Ventures' conversion point?

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To find Okat Ventures conversion condition and conversion point we need to calculate these based on ... View the full answer