Subscription Right

Finance allah shmoop what is a subscription price Well in

the old days you'd actually subscribe to these things They

were called magazines and they came on this stuff called

paper and there were tons of them Different focuses our

folks i of your fancy pants gardening people time and

lifestyle There was a set price if you wanted a

year These things you paid it while the term relates

in all things finances well In this sense a subscription

agreement applied directly to a new issue of shares from

a company or securities anyway raising money teo you know

pay off their new fleet of corporate jets are open

up china as a new market or for that pesky

lawsuit they got hit with for their products Apo supposedly

sticking teo certain types of skin So in this type

of offering offered preemptively to already existing holders of shares

a subscription agreement outlines the terms at which current investors

can invest in the new offering like fioretti ona hundred

shares of snail co The shipping company that vows to

send your packages slowly and carefully and they're trading and

i'll say eighty bucks each Well then that company might

have a rights offering in which current shareholders get the

right to buy new shares at say seventy seven bucks

each Well that's seventy seven dollar price is fixed as

the subscription price I'ii buyers of the incremental sale of

securities Get the right to pay seventy seven bucks for

them and they usually come in a discount to the

current market price So as the kind of sort of

semi guarantee that the full allotment of shares that the

company wants to sell well in fact actually be sold

to people who have already indicated that they like the

company or they wouldn't be holding the shares in the

first place And that goes true Ah even if those 00:01:42.119 --> [endTime] shares are sold very very slowly