preemptive right

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Related to Pre-Emptive Right: Subscription Rights

Preemptive right

Common stockholders' right to anything of value distributed by thecompany.

Preemptive Right

In stock, the ability of a shareholder to maintain the same percentage of ownership in a company should the company issue more stock by subscribing to a proportional number of shares at or below the market price. This protects the investor from devaluation of his/her shares if the company decides to hold a round of financing. The purchase of this proportional number of shares usually takes place before the new issue is offered to the secondary market, and must be exercised before a certain date (known as the expiration date) if the shareholder is to maintain the same percentage of ownership. It is also called a subscription right. See also: Anti-dilution provision.

preemptive right

A stockholder's right to keep a constant percentage of a firm's outstanding stock by being given the first chance to purchase shares in a new stock issue in proportion to the percentage of outstanding shares already held. Not all firms provide the preemptive right, which is more important to stockholders owning a significant part of a company. Also called subscription privilege. Compare privileged subscription. See also special subscription account.
References in periodicals archive ?
Telenor said the guarantees given by the other parties in court pledging to its pre-emptive rights should Telenor win arbitration were "the next best thing" to an injunction.
In the future, Barrick may from time to time increase or decrease its ownership of securities of Diamondex, including by way of private agreements, open market transactions, the exercise of Barrick's pre-emptive right, or other means.
It added that it had offered UIA shareholders the pre-emptive right on the acquisition, but they all declined.
Diamondex has also granted a pre-emptive right to Barrick, giving Barrick the opportunity to maintain its proportionate interest in Diamondex in the event of certain future offerings of common shares or securities convertible into or exchangeable for common shares, subject to maintaining a minimum shareholding in Diamondex.
Pursuant to the Joint Venture Agreement, KWG and Spider each has a pre-emptive right in respect of the transfer of the Joint Venture Interest on the same terms and conditions.
Under the agreement, LionOre Australia will have a pre-emptive right to enter into an off-take agreement for the treatment of nickel ore and/or concentrates produced from any of Breakaway's tenements.
All registered shareholders of the Company were given a pre-emptive right to subscribe to their pro rata share of the new Ordinary Shares.
Medivir Aktiebolag (STO:MVIRB), a research-based pharmaceutical company with a focus on oncology, reported on Friday that at the Extraordinary General Meeting , held on 26 January 2018, it was resolved, to authorise the board, for the period up to the annual general meeting 2018, to resolve to issue new shares of series B with deviation from the shareholders' pre-emptive rights.
It plans pre-emptive rights meaning that A2A is required to tell the government that if it agrees to sell its shares in the co, together with information on the new buyer and the conditions of the sale, at the same time as the government has the right to use its pre-emptive rights if it does not agree with the deal.
NASDAQ: CIVB) said its shareholders have voted to approve proposals to eliminate pre-emptive rights and cumulative voting at a special meeting of shareholders.
There are no warrants, pre-emptive rights, or other rights or preferences.
TeliaSonera has pre-emptive rights to buy the government stake, according to Izvestia.