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Frequently Asked Questions
  How does Nasdaq calculate the Market Value of Unrestricted Publicly Held Shares of a company offering units?
Identification Number 1836

Nasdaq calculates a company’s Market Value of Unrestricted Publicly Held Shares by multiplying the number Unrestricted Publicly Held Shares by the offering price of the common stock (or common stock equivalent) included in the units. For these purposes, Nasdaq attributes a value of $.125 for each “plain vanilla” warrant that is at- or out-of-the-money included in the unit. For warrants that are in the money or contain price protection or any other structured provisions that increase the potential dilution in the transaction, Nasdaq will attribute a value to each warrant equal to, or greater than, the value determined based on the Black Scholes model. 

For example, a unit is offered at $5.00 per unit and is structured to include one share of common stock and one warrant exercisable for $5.00.  For purposes of calculating the Market Value of Unrestricted Publicly Held Shares, Nasdaq would multiply the number of Unrestricted Publicly Held Shares by $4.875 ($5.00-$0.125). If this was a public offering for 3 million units, and there were no other Unrestricted Publicly Held Shares before the offering, then the offering size would be $15 million but the company’s Market Value of Unrestricted Publicly Held Shares would be $14,625,000.

Publication Date*: 5/15/2023 Mailto Link Identification Number: 1836
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