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Pharoah Technologies agreed to complete its IPO on a best-effort basis. The companys investment bank demanded a spread of 13 percent of the offer price,
Pharoah Technologies agreed to complete its IPO on a best-effort basis. The companys investment bank demanded a spread of 13 percent of the offer price, which was set at $29 per share. Three million shares were issued; however, the bank's management was overly optimistic and eventually was able to sell all of the stock for only $26 per share. What were the proceeds for the issuer and the underwriter?
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