1. How much is terminal value and how was it derived?
2. What are the required returns for each investor's specific round of 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?

Please explain how you got the answer. Thank you!

															% of Ownership After Round of Funding
Financing Round	Amount in Millions	Year	Required Return	Earnings at Terminal Value Millions	Merited PE at Terminal Value	Respective values at specific year	% Ownership	Retention Ratio Per Round	% Ownership at Round with retention	Investor shares at funding round	Total issued shares	Price per share	Post Money Value	Pre-Money Value	Round 1	Round 2	Round 3	After Incentive Pool
1	$ 6	0	60%			$ 14.31	41.9%	63.7%	65.8%	1,923,849.11	2,923,849.11	$ 3.12	$ 9,118,747.71	$ 3,118,747.71	65.80%	54.8%	49.3%	41.9%
2	$ 8	2	40%			$ 62.47	12.8%	76.6%	16.7%	587,356.78	3,511,205.89	$ 13.62	$ 47,823,823.41	$ 39,823,823.41		16.7%	15.1%	12.8%
3	$ 12	4	30%			$ 142.01	8.5%	85.0%	9.9%	387,585.76	3,898,791.65	$ 30.96	$ 120,710,059.17	$ 108,710,059.17			9.9%	8.5%
		6		$ 12	20	$ 240								Orig. Owners	34.20%	28.5%	25.6%	21.8%
																		15%
Retained for Employee incentive pool								15%						Total Ownership	100.00%	100.00%	100.00%	100.00%
Number of shares outstanding at time 0								1,000,000