(1) List three provisions in the corporate charter that affect takeovers.
(2) Briefly describe the use of stock options in a compensation plan. What are some potential problems with stock options as a form of compensation?
You have been hired as a consultant to Kulpa Fishing Supplies (KFS), a company that is seeking to increase its value. The company’s CEO and founder, Mia Kulpa, has asked you to estimate the value of two privately held companies that KFS is considering acquiring. But first, the senior management of KFS would like for you to explain how to value companies that don’t pay any dividends. You have structured your presentation around the following questions: