please help with answers to questions 1 - 4. Thanks.

EAST COAST YACHTS GOES PUBLIC Larissa Warren and Dan Ervin have been discussing the future of East Coast Yachts. The com- pany has been experiencing fast growth, and the future looks like clear sailing. However, the fast growth means that the company's growth can no longer be funded by internal sources, so La rissa and Dan have decided the time is right to take the company public. To this end, they have entered into discussions with the investment bank of Crowe &Mallard. The company has a working relationship with Robin Perry, the underwriter who assisted with the company's previous bond offering. Crowe&Mallard have helped numerous small companies in the process, so Larissa and Dan feel confident with this choice. IPC Robin begins by telling Larissa and Dan about the process. Although Crowe& Mallard on all initial stock offerings of the size of East Coast Yachts' initial offering. Robin tells Larissa charged an underwriter fee of 4 percent on the bond offering, the underwriter fee is pe 8 fees and expenses registration fees, and $20,000 in other filing fees. Additionally, to be listed on e company must pay $100,000. There are also transfer agent fees of $8,500 and engraving expenses of $525.000. The company should also expect to pay $75.000 for other nd Dan that the company can expect to pay about $1.800,000 in legal $15,000 in SEC the NASDAQ, th expenses associated with the IPO. Finally, Robin tells Larissa and Dan that to file with the SEC, the company must provide audited financial statements. She is unsure of the costs of the audit. Dan obin that the company provides audited financial statements as part of its bond indenture, three years' worth of tells R and the company pays $325,000 per year for the outside auditor. 1. At the end of the discussion Dan asks Robin about the Dutch auction IPO process. What are the differences in the expenses to East Coast Yachts if it uses a Dutch auction IPO versus a traditional IPO? Should the company go public with a Dutch auction or use a traditional underwritten offering? 2. During the discussion of the potential IPO and East Coast Yachts' future, Dan states that he feels the company should raise $75 million. However, Larissa points out that if the company needs more cash soon, a secondary offering close to the IPO would be potentially problematic. Instead, she suggests that the company should raise $100 million in the IPO How can we calculate the optimal size of the IPO? What are the advantages and disadvan tages of increasing the size of the IPO to $100 million? 3. After deliberation, Larissa and Dan have decided that the company should use a firm commitment offering with Crowe&Mallard as the lead underwriter. The IPO will be for $85 million. Ignoring underpricing, how much will the IPO cost the company as a percent- age of the funds received? 4. Many of the employees of East Coast Yachts have shares of stock in the company because of an existing employee stock purchase plan. To sell the stock, the employees can tender their shares to be sold in the IPO at the offering price, or the employees can retain their stock and sell it in the secondary market after East Coast Yachts goes public (once the 180-day lockup period expires). Larissa asks you to advise the employees about which option is best. What would you suggest to the employees