Examlex

Solved

Steve Is the Founder of Jefferson & Westover

question 54

Essay

Steve is the founder of Jefferson & Westover.Recently,the firm decided to issue an IPO with Steve retaining 30 percent ownership of the firm.The IPO agreement contained both a Green Shoe provision and a 6-month lockup agreement.Steve's cost basis per share is $15.The offering price for the IPO was $16.On the first day of trading,the market price per share rose to $28.20 and closed for the day at $25.60.Now,six months after the IPO release,the stock is valued at $15.40 a share.Explain who benefited the most during the lockup period,an outside investor or Steve,and why.


Definitions:

Related Questions