Finance: What is a subscription price?

What is a subscription price? A subscription price refers to the fixed, or exercise price of shareholder rights offerings. This may be in the form of oversubscribed or secondary stock offers, warrants, or securities convertible into common stock.

CoursesFinance Concepts
FinanceFinance Definitions
Financial Responsibility
Personal Finance
Finance and EconomicsTerms and Concepts
LanguageEnglish Language
Life SkillsFinance Definitions
Personal Finance
SubjectsFinance and Economics

Transcript

00:24

lifestyle There was a set price if you wanted a

00:26

year These things you paid it while the term relates

00:28

in all things finances well In this sense a subscription

00:32

agreement applied directly to a new issue of shares from

00:34

a company or securities anyway raising money teo you know

00:38

pay off their new fleet of corporate jets are open

00:40

up china as a new market or for that pesky

00:42

lawsuit they got hit with for their products Apo supposedly

00:46

sticking teo certain types of skin So in this type

00:49

of offering offered preemptively to already existing holders of shares

00:54

a subscription agreement outlines the terms at which current investors

00:57

can invest in the new offering like fioretti ona hundred

01:00

shares of snail co The shipping company that vows to

01:03

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

01:07

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

01:10

have a rights offering in which current shareholders get the

01:12

right to buy new shares at say seventy seven bucks

01:15

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

01:18

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

01:22

securities Get the right to pay seventy seven bucks for

01:24

them and they usually come in a discount to the

01:26

current market price So as the kind of sort of

01:28

semi guarantee that the full allotment of shares that the

01:31

company wants to sell well in fact actually be sold

01:34

to people who have already indicated that they like the

01:37

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

01:39

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