Case 2 Bucks Essay

A bank loan for $65,000 was taken out. The amount was kept in cash over the end of the month.

(d) $1 billion 10 year debenture @ 7.5% with 18.18 warrants at $ 55 exercisable until 1988.

What is the terminal value of the final 10 years of the acquisition, as of 2022?

The company has an agreement with a bank that allows the company to borrow the exact amount needed at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company will pay the bank all of the accrued interest on the loan and as much of the loan as possible while still retaining at least $50,000 in cash.

ten­year loan OVS has been extended by their bank to help finance its rapid expansion. If such a

* Buffett paid $12,000 on February 1, 2012, for the Volcano System and the related PCS.

New bank credit facility, 600 million cash on hand to take advantage of opportunities that may arise

Right then the bet was on. Buck had to break out a 1000 lb sled and pull it a 100 yard for $1000 dollars.

1. Based on the 10 percent compensating balance requirement, how much would Pierce Control Systems have to borrow to acquire $10 million in needed funds?

Credit ratio requirement: The company covenants that it will not permit current assets at any time to be less than, for example, 150 percent of current liabilities.

The third scenario involves the same $100 million borrowing capacity:, only each draw does not have its own maturity date specified.  Instead, whatever outstanding balance remaining is due by the end of the three-year credit line term, or December 31, 2012.  The first draw is made on June 30, 2010, in the amount of $70 million.  Another draw for $15 million is made on September 30 of the same year, followed by another draw for $15 million on November 30.  The only repayment made by Buck is that made on December 15, 2010, in the amount of $50 million.

Using the AFN equation, it was calculated (assuming there were no dividends paid, and that sales were expected to grow to $3.6 million) that the amount of extra funding needed would be approximately $76,360. This amount would

Additionally, because of the tax rules, 50% of the purchased price, which is $12 million, was designed as the value of the player roster then. This value was capitalized and depreciated over six years.

* Finance Receivables and Investments are $s owed to GECC, generates interest expense on P&L.

| Limited Debt Capacity. There are only 50 Banks. $6 Bn in loan requires over $100mn per bank which is a huge task for many banks.