Share Purchase Rights

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DEFINITION of 'Share Purchase Rights'

A type of security that gives the holder the option, but not the obligation, to purchase a predetermined number of shares at a predetermined price. This is similar to a stock option or warrant. These rights are typically distributed to existing shareholders, who have the ability to trade these rights on an exchange.

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BREAKING DOWN 'Share Purchase Rights'

The rights only give shareholders the ability to purchase the shares, but they must still must pay for the shares to redeem the rights.

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RELATED FAQS
  1. What is the difference between share purchase rights and options?

    There is a big difference between share purchase rights and options. With share purchase rights, the holder may or may not ... Read Full Answer >>
  2. Why should investors consider the fully diluted share amount?

    Investors should consider a company's fully diluted share amount before purchasing the company's stock, because it could ... Read Full Answer >>
  3. What's the difference between basic shares and fully diluted shares?

    Basic shares and fully diluted shares are different types of methods to measure the amount of shares investors hold in a ... Read Full Answer >>
  4. How do modern companies assess business risk?

    Before a business can assess or mitigate business risk, it must first identify probable or likely risks to its bottom line. ... Read Full Answer >>
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    Corporate governance refers to operational practices, management protocols, and other governing rules or principles by which ... Read Full Answer >>
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