Question
A.) A companys Series A round of preferred stock was sold at $1.00 per share for 2,000,000 shares with a pre-money valuation of $5,000,000. Total
A.) A companys Series A round of preferred stock was sold at $1.00 per share for 2,000,000 shares with a pre-money valuation of $5,000,000. Total fully diluted shares outstanding after the Series A round was 7,000,000. The Series B preferred share price has been pegged at $0.75 per share and the Series A investors have a full-ratchet anti-dilution clause in their purchase agreement. How many ADDITIONAL SHARES will the Series A investors receive due to their anti-dilution clause?
B.) With the same facts as above, but the Series A investors have a weighted-average anti-dilution clause, and the new investment in the Series B will be $1,500,000. what will be the new price of the Series A stock?
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