Alex launched a company with $500K initial investments and 100K shares. Angel X invested $200K through convertible note in a year. Convertible note parameters were: 8.5% coupon yield and 20% discount for conversion at the next round, valuation cap $2mln. In 9 months, a new investment round closed with pre-money valuation $10mln. Angel X converted the note. How many shares did the angel get?

Alex launched a company with $500K initial investments and 100K shares. Angel X invested $200K through convertible note in a year. Convertible note parameters were: 8.5% coupon yield and 20% discount for conversion at the next round, valuation cap $2mln. In 9 months, a new investment round closed with pre-money valuation $10mln. Angel X converted the note. How many shares did the angel get?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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