Shelf registration allows a firm to register multiple issues at one time with the SEC and then sell those registered shares anytime during the subsequent:
Refer to section 15.11
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53.
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Aaron's Sailboats has decided to take the company public by offering a total of 120,000 shares of common stock to the public. The firm has hired an underwriter who arranges a full commitment underwriting and suggests an initial selling price of $25 a share with a 7 percent spread. As it turns out, the underwriters only sell 97,400 shares. How much cash will Aaron's Sailboats receive from its first public offering?
Total cash received = 120,000 × $25 (1 - 0.07) = $2,790,000
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54.
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Nelson Paints recently went public by offering 65,000 shares of common stock to the public. The underwriters provided their services in a best efforts underwriting. The offering price was set at $16 a share and the gross spread was $2. After completing their sales efforts, the underwriters determined that they sold a total of 57,500 shares. How much cash did Nelson Paints receive from its IPO?
Total cash received = 57,500 × ($16 - $2) = $805,000
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55.
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Miller Motors has decided to sell 1,800 shares of stock through a Dutch auction. The bids received are as follows:
How much will Miller Motors receive in total from selling the 1,600 shares? Ignore all transaction and flotation costs.
Total cash received = 1,800 × $20 = $36,000
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