Both warrants and rights result in new capital equity. However, warrants are issued at an exercise price below the prevailing market price of the stock; rights are generally issued at a subscription price above the prevailing market price.

Question

Quizplus · Accepted Answer

Warrants are issued at a price below the prevailing market price of the stock, while rights are generally issued at a subscription price equal to or below the prevailing market price.

Both Warrants and Rights Result in New Capital Equity