Mast Therapeutics, Inc. (MSTX)

[tinylion]

I fully understand a reverse split but an exchange ratio in a merger is not the same thing. You will be issued 1 share of the new company for whatever the final exchange ratio is regardless of the price.

The more MSTX is trading for the day of the merger the more you will pay

From investopedia

Example of Exchange Ratio

The exchange ratio in a merger or acquisition is the opposite of a fixed value deal in which a buyer offers a dollar amount to the seller, meaning that the number of shares or other assets backing the dollar value can fluctuate in an exchange ratio. For example, imagine that the buyer offers the seller 2 shares of the buyer's company in exchange for 1 share of the seller's company. Prior to the announcement of the deal, the buyer's shares may be trading at $10, while the seller's shares trade at $15. Due to the 2 to 1 exchange ratio, the buyer is effectively offering $20 for a seller share that is trading at $15.

Fixed exchange ratios are usually limited by caps and floors to reflect extreme changes in stock prices. Caps and floors prevent the seller from receiving significantly less consideration than anticipated, and they likewise prevent the buyer from giving up significantly more consideration than anticipated. Exchange ratios can also be accompanied by a cash component in a merger or acquisition, depending on the preferences of the companies involved in the deal.


Read more: Exchange Ratio Definition | Investopedia http://www.investopedia.com/terms/e/exchangeratio.asp#ixzz4YxstSuYF
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