Ionutzakis

In theory, the common shares will never increase by the exact amount of convertible warrants. Warrant and option holders, more often than not, are usually required to contribute the prescribed amount if they are in the money.

In the above example, 10m warrants are convertible to 10m common shares at $25 per share - however the current average price is at $50 per share. The percentage difference between the two prices is effectively the net increase in common shares if the warrants are excercised.

A nifty way to calculate this is the following:

((ASP-EP)/ASP) x N

((50-25)/50) x 10m = 5m