they are both A
i did B for 15 also, but its somehow A idk
can you explain 8 cause idk the difference between all the shares. ik theres new issue, but then idk the difference between rights issue, placements and share purchase plans
soz 15-a
Rights issues
- Is an invitation to existing shareholders to purchase additional shares in the company
- Allows a public company to raise additional funds by offering existing shareholders the opportunity to purchase additional shares in proportion to their current holdings
- E.g. right to purchase 1 new share per 2 owned
- This type of issue gives existing shareholders securities called “rights”, which give the shareholders the right to purchase new shares at a discount to the market pride on a stated future date
- Companies most commonly issue a rights issue to raise additional capital
- A company may need extra capital to meet its current financial obligations
- Troubled companies typically use rights issues to pay down debt, especially when they are unable to borrow more money
- However, not all companies that pursue rights issues are in financial trouble.
- Even companies with clean balance sheets may use rights issues to raise extra capital to fund expenditures designed to expand the company’s business, such as acquisitions (when one company purchases most or all of another company's shares to gain control of that company) or opening new facilities for manufacturing
Placements
- The process of offering additional shares to specific institutions + specific (large) investors
- Adv: Placement funds can be raised quickly, often within 24 hours + in large amounts
- Disadv: These companies may need to pay underwriters’ fees in order to make up for any shortfall in the money raised
Share purchase plan
- Allow existing companies to issue a maximum of $30,000 in new shares to existing shareholder without issuing a prospectus
- Are only offered to existing shareholders to purchase more shares in that company without brokerage fees.
- The shares can also be offered at a discount to the current market price