1. Ever the risk taker, Max has invested in another of Sam's companies. This time, he pays $3 million for 30 percent of SpecialStuff (SS). Calculate the payout table and draw the graphs for Sam and Max in the following situations: a. The deal is structured as all-common, and PredatoryPurchaser (PP) offers Sam $3.5 million for the company. b. The deal is structured as redeemable preferred with cheap common, and PredatoryPurchaser offers Sam $3.5 million for the company. c. The deal is structured as convertible preferred, and PredatoryPurchaser offers Sam $5 million for the company. At what price will Max convert to common? d. SpecialStuff goes public at a valuation of $20 million, and Max owns participating convertible preferred. e. OtherStuff, a private company, buys SpecialStuff for $7 million. Max owns participating convertible preferred. 2. SpecialStuff needs another $3 million. Acme, happy with its returns on Sam's first company, eagerly agrees to participate, investing $4 million for 20 percent of the company. Assume the first round was as in question 1 and that Acme and Max each own convertible preferred stock. a. How much do Max and Sam now own? b. Create payout tables for exit values at $4 million, $8 million, $12 million, and $20 million for each participant assuming pooled seniority. c. . . . with Acme senior to Max and Sam. 3. Calculate the difference in Max's ownership in the following scenarios: SpecialStuff raised its A round at $1.50 per share. Max invested $1.5 million for one million shares and 30 percent ownership. Now SpecialStuff is raising a B round, but the market has turned against it and Acme will pay only $1.00 per share for 1 million shares. (Assume that Max doesn't participate at all and allows Acme Ventures to take the whole round.) a. What if Max has full-ratchet antidilution? b. Weighted average? c. If Max participates pro rata to his ownership, how will parts 3a and 3b change? 4. If a mezzanine investor has received warrant coverage for 5 percent of a $3 million loan where the equity investors are paying $2.50 per share, how many shares will she be able to buy and at what price?