Stock issue

Your parent firm may issue new shares of common stock through an investment banker in multiples of 100,000 shares, provided the new issue will be large enough to raise at least $1 million.  The investment banker will make a firm offer at any time of a price that will be determined by the following formula:

If your firm's credit rating is 2, this is the issue price. If your firm's credit rating is 3, subtract 10 percent of the formula value from the issue price.  If your credit rating is 1, add 10 percent.

Enter the number of new shares to be issued (in thousands of shares) on the decision form under Stock Issue.  If your firm decides to issue 4,000,000 shares of stock, for example, enter 4000 on the decision form.  Do not include commas in your entry.

External sale (or repurchase) of common stock will be undertaken only by your parent company, in thousands of dollars. Subsidiaries may issue stock only to the parent company, and only to meet financing requirements due to working capital shortages, plant construction or purchase and installation of new equipment.  Sales of subsidiary stock will occur automatically when additional funds are required, and no decision entry is necessary.

Minimum issue:  Enough shares to raise $1 million

Limits:  0 to 9000 (in thousands of shares) in 100,000-share blocks