7. Based on your answers from the above questions, how would you respond to each directors assignment of the financing decision? Please evaluate each directors comments carefully: Andrew Winfield Joseph Winfield Ted Kale Joseph Tendi and Naomi Ghonche James Gitanga

8. What is your final recommendation for Winfield

What is Winfields operating margin in the year 2011? Is it comparable to the industry companies? 2. What are the annual cash outlays in 2013 associated with the bond issue (including the interest tax shield)? The common stock issue? 3. What is the debt coverage in year1 after the merger? Assume the annual payment for the capital lease is 11%, and no additional long-term liabilities for MPIS. The operating cash flows of the combined company are $66 million. 4. Do you think Winfileds bondholders are getting a higher return at low risk compared to shareholders? 5. What risks are posed by the sale of new shares? Do you think the stock of Winfield is undervalued? Does issuing new shares dilute the stick of existing shareholders? 6. What are the risks and rewards of carrying a high leverage? More specifically, how does the EBIT chart (Exhibit 4) tell us about the risks and benefits of using leverage? Please examine the slope for each plan and discuss the significances