Below is the Shareholders Equity portion of Shopify Inc.s Consolidated Balance Sheet and the companys press release announcing its recent equity issue. Please use ONLY the information provided to answer the following questions.

1.How much did Shopify earn (or lose) from its normal course operations during fiscal 2019? Show your calculation. 2.Calculate the growth in book value per share for fiscal 2019 compared with fiscal 2018. 3.In your own words, explain why Shopify is granting the equity underwriters an over-allotment option for the recent deal. 4.Why do you think Shopify would issue both equity AND convertible senior notes? 5.If Shopifys Class A shares were trading at $398 on December 31, 2019, what was the companys market capitalization as of this date? Show your calculations. NOTE: the Class B shares are not listed for trading, however Class B shares can be converted to Class A shares on a one-for-one basis. 6. Explain the primary reason why companies issue two classes of shares.

Consolidated Balance Sheet note DEC 31,2019 Dec 31,2018

Common Stock, unlimited Class A, subordinated voting share authorized 17 3,256,284 2,215,936

104,518,173 and 98,081,889 issues and outstanding; unlimited calss b

multiple voting share authorized, 11,910,802 and 12,310,800

issued and outstanding

Addition Paid in Capital 62,628 74,805

Accumulated income(Loss) 18 1046 (12216)

Accumulated Deficit 3 (304224) (187757)

Totel Shareholders equity 3015734 2090768 Shopify Prices Offerings of Class A Subordinate Voting Shares and Convertible Senior Notes September 15, 2020 11:32 PM Eastern Daylight Time OTTAWA, Ontario--(BUSINESS WIRE)--Shopify Inc. (NYSE:SHOP) (TSX:SHOP) (Shopify) today announced the pricing of its previously announced public offering of 1,100,000 Class A subordinate voting shares (the Offered Shares) at a price to the public of US$900 per share (such offering, the Equity Offering) and its previously announced public offering of US$800,000,000 aggregate principal amount of convertible senior notes due 2025 (the Notes) (such offering, the Note Offering, and together with the Equity Offering, the Offerings). The gross proceeds from the Equity Offering, before underwriting discounts and offering costs, are expected to be US$990,000,000, and the gross proceeds from the Note Offering, before underwriting discounts and offering costs, are expected to be US$800,000,000. The Equity Offering and the Note Offering are not conditional upon one another.

Shopify has granted the Equity Underwriters (as defined below) an over-allotment option to purchase up to an additional 165,000 Class A subordinate voting shares to be sold pursuant to the Equity Offering (the Equity Over-Allotment Option). The Equity Over-Allotment Option is exercisable for a period of 30 days from the date of the final prospectus supplement relating to the Equity Offering. Shopify has also granted the Note Underwriters (as defined below) an over-allotment option to purchase up to an additional US$120,000,000 aggregate principal amount of Notes (the Note Over-Allotment Option). The Note Over-Allotment Option is exercisable for a period of 30 days from the date of the final prospectus supplement relating to the Note Offering.

Shopify expects to use the net proceeds of the Offerings to strengthen its balance sheet, providing flexibility to fund its growth strategies.

The closings of the Equity Offering and the Note Offering are subject to a number of closing conditions, including the listing of the Offered Shares and approval to list the Class A subordinate voting shares underlying the Notes on the NYSE and the TSX, and any required approvals of each exchange, and are expected to occur on or about September 18, 2020. The Equity Offering is being led by Citigroup, Goldman Sachs & Co. LLC and Credit Suisse, with RBC Capital Markets acting as Co-Manager (the Equity Underwriters), and the Note Offering is being led by Goldman Sachs & Co. LLC, Citigroup and Credit Suisse, with RBC Capital Markets acting as Co-Manager (the Note Underwriters).

The Notes will be senior, unsecured obligations of Shopify, and interest will be payable semi-annually in cash at a rate of 0.125% per annum on May 1 and November 1 of each year, beginning on May 1, 2021. The Notes will mature on November 1, 2025 unless redeemed, repurchased, or converted prior to such date. Prior to August 1, 2025, the Notes will be convertible at the option of the holders during certain periods, upon satisfaction of certain conditions. Thereafter, the Notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, the Notes may be settled, at Shopify's election, in Shopifys Class A subordinate voting shares, cash or a combination thereof.

The Notes will have an initial conversion rate of 0.6944 Class A subordinate voting shares per US$1,000 principal amount of Notes. This represents an initial conversion price of approximately US$1,440 per Class A subordinate voting share. The initial conversion price of the Notes represents a premium of approximately 60% to the price per Offered Share in the Equity Offering.