Draw out a capitalisation table to take into account the rounds of transactions below:

a. Round one: Mr Murphy established a company and issued 1,000 ordinary shares to himself in return for an investment of ?10,000. Mr. Murphy's shares are to be subject to vesting over 4 years, whereby if he stays for 1 year only, he gets to keep 25% of his shareholding, 50% if 2 years, etc. If he leaves, the unvested shares are to be transferred to his replacement. In addition to the 1,000 shares, he created an employee share option pool with 2,500 ordinary shares.

b. Round Two: Nettle Investor invested ?200,000 in Redeemable Preference Shares and ?5,000 in ordinary shares at a price per share of ?25. In addition, Mr Murphy was allocated share options over 5,000 ordinary shares at a strike price of ?251 which are not subject to vesting

c. Round Three: Weed Investor invested ?500,000 in Participating Preference Shares at a pre-money valuation of ?5m. Weed also negotiated that its valuation would be reduced to the pre-money valuation of the next round, if the pre-money valuation of round four is less than round three. The reduction in valuation would be effected by giving Weed free shares at the time of round four.

d. Round Four: Foxglove Investor invested ?2m in Convertible Preference Shares at a price of ?1,000 per share. At the same time, Nettle converted (no new money invested) its Redeemable Preference Shares into ordinary shares at a price of ?1,000. per share.

e. Round Five: Mr. Murphy left the business three years after round one took place. He was replaced by Mr. Schmidt.

Ordinary Shares (assuming conversion of convertible preference shares & options)

Round - R R1 R2 R3 R4 R5 total shares owned Shareholders Mr Murphy 1,000 0 0 0 0 1000 100 Investor 1 Investor 2 Investor 3 Investor 4 Employee options Total this round Cumulative total Valuations Outside capital this R % of company purchased Post money valuation Pre money valuation Apparent price per share Per share price in reality Mr Murphy share value post-RWaterfall Possible Sale Values Sale price of company 5m 10m 30m Shareholders Number of shares % Total 100