Definition for : Treasury method

Treasury method is one of two methods of adjusting the number of shares outstanding for warrants exercise. This method consists of assuming that Investors will exercise their warrants, but that the company does not invest the proceeds. Instead, the company uses the proceeds to buy back some of its shares on the Market. In this manner, the company can Offset some of the dilution (see dilution – Shareholders) caused by the exercise of the warrants.

(See Chapter 23 Options of the Vernimmen)

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