Preemptive Right

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Preemptive Right

The privilege of a stockholder to maintain a proportionate share of the ownership of a corporation by purchasing a proportionate share of any new stock issues.

In most jurisdictions, an existing stockholder has the right to buy additional shares of a new issue to preserve Equity before others have a right to purchase shares of the new issue.

preemptive right

n. the right of a shareholder in a corporation to have the first opportunity to purchase a new issue of stock of that corporation in proportion to the amount of stock already owned by the shareholder. (See: corporation, stock)

References in periodicals archive ?
Answer--The market occasionally intermixes the terms of warrant and stock right.
permitting the holder to exchange the Stock Right for a cash amount that would be available if the Stock Right were exercised;
Poison pills" are contingent stock rights that are incorporated into a stock certificate or distributed as a dividend, which serve to enable a corporation to defend itself against an unsolicited tender offer.
The preamble to the proposed regulations suggests that whenever the terms of the stock agreement or those of the plan under which the right is granted provide the plan administrator with a general power to modify the terms of outstanding grants of stock rights, none of the grants will be excluded from treatment as deferred compensation under Sec.
the related stock's holding period "tacks on" to the stock right, under Sec.
on Wednesday said it slashed its offer price of its stock rights offer (SRO), selling it at 22-percent discount, and expects to raise some P60 billion from the sale that will begin next week.
has priced its stock rights offering at P75 per share, finalizing a P60-billion capital-raising which will support a fast-growing loan book in the coming years.
Metropolitan Bank & Trust Company (Metrobank) has set the final terms for its P60-billion stock rights offering with the offer price pegged at P75 per share.
Babcock & Wilcox announced that it has fixed March 15 as the record date for determination of shareholders entitled to participate in B&W's common stock rights offering.
Monzon said the PSE is on track with its scheduled stock rights offering, which is intended to reduce the brokers' ownership in the exchange to the 20 percent limit mandated by the Securities Regulation Code.
Trinity Place Holdings Inc (NYSE MKT:TPHS) revealed on Thursday the final results of its common stock rights offering at USD7.