Problem #1: (5 Points) Post Investment Capitalization Equity Table: Startup JK has been in business for eighteen months. Currently, Investor X owns 15%, Investor Yowns 10%, CEO/Founder owns 40% (and has invested $200,000 in cash over this timeframe in order to maintain this more significant ownership position), and the CTO owns 15% after creating a 20% Stock Option Pool six months ago in anticipation of significant future hires and a desire to motivate all employees. Startup JK has successfully negotiated a $1,000,000 Series A Preferred Equity investment, at a $2,500,000 Pre-Money Valuation, from several Angel Groups (i.e. thru a Syndication) located within the surrounding states. Insert the "answer" into each of the below "blanks" AND then fill-in ALL the gray shaded boxes for the current % Equity ownership for each current Shareholder (i.e. the Pre-Investment) and then compute and insert again in the gray shaded boxes the forecasted % Equity ownership AFTER this planned Series A Preferred investment is closed in the below table. Investment Dilution Factor (%): Series A Preferred Post Money Valuation ($): % Equity % Equity Shareholder Pre-Investment Post-Investment CEO/Founder CTO Investor X Investor Y Stock Option Pool = Series A Preferred-New Total Problem #2: (5 Points) Capitalization Table - Using # Shares (Units): Currently, the CEO/Founder owns 500,000 shares, which represents 100% of the Common equity, of the Company. Prior to raising a $750,000 in Series A Preferred investment from a local Angel Group, the CEO decided to proactively create a 30% Stock Option Pool given the large number of incremental required key executive hires and independent Board members. Given the strong intellectual Property this pre-seed stage Company owns, the Pre-Money Valuation has been set at $1,750,000. Construct a fully diluted Capitalization Table reflecting the current ownership (i.e. before creation of the Stock Option Pool), the impact of the pre- money stock option pool formation, and post Series A Preferred investment listing both # shares and % equity. What is the Series A Preferred $ Price per Share? (Check your work: The Total # Shares times the $/Share MUST EQUAL the Series A Post Money Valuation). I Series A Preferred $ Price/Share ($): Post Stock Pre-Stock Option Option # % # % Shares Equity Shares Equity Post Series A Inv. # % Shares Equity Shareholder CEO/Founder Stock Option Pool Series A Pref.- New Total Problem #3: (20 Points) Complete Single-Round Funding Capitalization Table: Two Co-Founders, a CEO & a CTO, has been diligently preparing to launch Startup KL. for the last twelve months. The CEO owns 75% and the CTO owns 25% of the Company's 700,000 outstanding shares. The CEO is fully aware a Stock Option Plan will need to be created in order to successfully recruit future several key senior entrepreneurial executives and Board Members to build the company. As such, the CEO plans to create a 30% Stock Option Pool under a Pre- Money basis. Immediately thereafter, Startup KL will close on the verbally fully committed $350,000 in Common Stock offering. This Common Stock Funding group includes: 1) a local retired executive from a Fortune 500 company who is a close personal acquaintance for $50,000, a wealthy Uncle for $20,000, and the local active Angel Group for the $280,000 remaining balance. This investor has agreed to accept Common Stock given the very attractive (.e. low) agreed upon Pre-Money Valuation of $650,000. Based upon the Financial Model the company will need to raise one additional follow-on Investment rounds, which is forecasted to be structured as a Series A Preferred and ideally will be funded by an Angel Group Syndication lead by the current investing local Angel Group. For the CEO please complete (fill in all the gray shaded boxes) in the following Capitalization Table-Single Funding for Startup KL. Round % to tenths. I Startup KL-Capitalization Table-Single Funding Template Total Founding Shares Pre-Money Common Pre-Money Valuation Stock Options Common Stock Raised Pool Common Post Money Valuation Common Investor(s) % Equity Common investor per Share Price Initial Total Total Commons Common Total Total Shareholders: Shares XEquity Shares Equity Investment Shares Shares Equity Founder 21 - CEO Founder 12- CTO Option Pool Total Common Stock Inwestorld Fortune 500 Executive Wealthy Unde Local Angel Group Total has a total thara - Part Afiatry watalar