business case study
1. Prepare a Stacked Bar Diagram(excel file) beginning as of the company’s founding on December 1, 2001, through the proposed $10 million VC financing round at December 1, 2002. This Stacked Bar Diagram should incorporate all of the equity ownership and valuation data provided in the case (see case Exhibit 2) including pre-money and post money values for the company at each event date during 2002.
2. Assume Pharmaceutical company purchases Nanogene at end of 2005 for $50,000,000. Also, assume that Series A preferred is “participating” with 2x liquidation preference and 3x cap.
3. Calculate payoff from 2005 sale to each equity holder.
a. A. Assume all ESOP shares are allocated at a $0.15 strike price and that all vest on liquidation event
b. B. Assume same as in A (ESOP shares fully allocated) but that Paige, who was granted options on 280,000 shares, resigns after 18 mo. to “pursue other opportunities”.
