This case is made for use within JD/Master of business administration programs or perhaps in contexts where mutual knowledge of legal and financial issues is needed. The case concentrates on a business owner within the security-software industry who's trying to boost an initial round of financing in October 2000. The firm was not successful in bringing in funding from vc's and it has depended on the small seed round and bridge loan from angel traders. The angels have finally suggested trading $1.4 million in Series A convertible preferred stock. The entrepreneur have to research whether or not to accept the angel investors' proposal or revisit the problem of seeking investment capital. The case includes the Stockholder Seek the suggested Series A round, the capital of the organization following the seed round, and 5 years of money-flow forecasts for that firm. The case may be used inside a law-school setting like a contract-drafting exercise so that as introducing valuation. In business-school setting, the case might help students comprehend the complex car loan terms connected having a "plain-vanilla" type of investment capital. Valuation could be trained in an opening level, or it may be made more complicated if students are requested to include "what-if" contract conditions to their analysis.
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