Series 65: Preemptive Rights

Taken from our Series 65 Online Guide

Preemptive Rights

If a corporation decides to issue additional common stock, current stockholders have the right to maintain their share of ownership by purchasing a proportionate amount of the new issue before it is offered to the public. This is a stockholder’s preemptive right. A preemptive right serves as anti-dilution protection for common stockholders—they have the right to protect

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