1. What are the tax consequences of the recap? 2. Based only on the tax effects and the l.l'aluation Principle, what will be the total value of the firm after the recap? a. How much of the new value will be equity? b. How much will be debt? 3. At what price should Midco be able to repurchase its shares? 4. Who benets from the recap? Who loses? 5. What other costs or benefits of the additional leverage should Midco's managers consider? 6. If Midco's managers decide to issue the debt and distribute the tax shield as a special dividend instead of repurchasing shares, what will the dividend per share be