Hi Finance Tutors,

I need some help answering the following Threshold Sports Case study questions.

1.What are management?s goals and strategy?What creates the financing need in this company?Is there a first-mover advantage?Explain.

2.Assuming a 40% tax rate, what is Threshold worth?(Note:The ?Profit (loss) from racing events? line in Exhibit 3 comes from Exhibit 2.Also, Exhibit 3 has some issues with terminology.The ?Net profit? line is not really net profit.Moreover, it would be better to use ?revenue? in place of ?income?.Also, there is a major error in the choice of items to list under ?Expenses?.See if you can spot the error and correct for it in your analysis.Your analysis will require use of the growing perpetuity/constant growth model in order to estimate a terminal value for your cash flows.Show your work for this question in an Excel attachment.)

3.How do the three financing alternatives compare based on a FRICTO analysis, i.e., flexibility, risk, income (or valuation), control, timing, and any other considerations that you think may be important?In other words, you need to systematically go through the FRICTO criteria, and for each criterion explain which financing source would be the best, and which financing source would be the worst.After you have looked at the three financing sources for each of the criteria, provide a recommendation for what Frischkorn should do about financing.A FRICTO document is posted on Blackboard that provides more explanation about the FRICTO criteria.You can find the link to the document on the left-hand side of the Blackboard page.IMPORTANT NOTE: When evaluating the financing alternatives be sure that you do not fall into the trap of evaluating them from the investor?s perspective.You are determining what would be good financing choices for the company.Your perspective needs to be that of the company.