For problem 9.14 the problem is worked for you in the attached Excel document. Use this document and address the following questions to earn credit for this problem: 1. How much is terminal value and how was it derived? 2. What are the required returms for each investor's specific roof financing? How do they compare to each other and why are they different? 3. What is the process used to determine an investor's present value relative to their round of financing? 4. Why did the owners desire to hold back 15% for employee incentive stock plans? As a prospective investor is this a welcome provision? Why or why not? 5. In general terms, explain how the percentage of ownership, retention, percentage of ownership with retention and number of shares issued to each investor are obtained? 0 % of Ownership After Round of Funding at Merited Terminal PE at Respective Retention Ratio Per %Ownership at Round with shares at funding ing in Required Terminal values at Total issuedPrice per share Pre-Money Value $3.118,747.71 $13.62 $47,823,823.41 $39,823,823.41 $30.96 $120,710,059.17 $108,710,059.17 Post Money Value $9.118.747.71 Round 1 65.80% Round 2 54.8% 16.7% Round 3 49.3% 15.1% 99% 25.6% Round Millions Year Return Millions Value specitic yer Ownership Round retention Pool 1 $6 2 $8 3 $12 060% 40% 30% $14.31 62.47 $142.01 41.9% 12.8% 8.5% 63.7% 765% 85.0% 65.8% 1.923.849.11 2.923.849.11 16.7% 587.356.78 3.511.205.89 9.9% 387,585.76 3,898,791.65 41.9% 12.8% 8.5% 21.8% 15% $3.12 $12 20 Orig. Owners 34.20% 28.5% 8 Retained for Employee incentive pool 9 Number of shares outstanding at time 0 10 1,000,000 For problem 9.14 the problem is worked for you in the attached Excel document. Use this document and address the following questions to earn credit for this problem: 1. How much is terminal value and how was it derived? 2. What are the required returms for each investor's specific roof financing? How do they compare to each other and why are they different? 3. What is the process used to determine an investor's present value relative to their round of financing? 4. Why did the owners desire to hold back 15% for employee incentive stock plans? As a prospective investor is this a welcome provision? Why or why not? 5. In general terms, explain how the percentage of ownership, retention, percentage of ownership with retention and number of shares issued to each investor are obtained? 0 % of Ownership After Round of Funding at Merited Terminal PE at Respective Retention Ratio Per %Ownership at Round with shares at funding ing in Required Terminal values at Total issuedPrice per share Pre-Money Value $3.118,747.71 $13.62 $47,823,823.41 $39,823,823.41 $30.96 $120,710,059.17 $108,710,059.17 Post Money Value $9.118.747.71 Round 1 65.80% Round 2 54.8% 16.7% Round 3 49.3% 15.1% 99% 25.6% Round Millions Year Return Millions Value specitic yer Ownership Round retention Pool 1 $6 2 $8 3 $12 060% 40% 30% $14.31 62.47 $142.01 41.9% 12.8% 8.5% 63.7% 765% 85.0% 65.8% 1.923.849.11 2.923.849.11 16.7% 587.356.78 3.511.205.89 9.9% 387,585.76 3,898,791.65 41.9% 12.8% 8.5% 21.8% 15% $3.12 $12 20 Orig. Owners 34.20% 28.5% 8 Retained for Employee incentive pool 9 Number of shares outstanding at time 0 10 1,000,000