A rights offering is:

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A rights offering is when a company offers to its existing shareholders the option to purchase additional shares of stock at a discounted price, usually proportional to their existing holdings in the company. It is a way for the company to raise additional capital without going to the public markets, and for existing shareholders to maintain their ownership percentage in the company. Option A is incorrect because the options are not offered to the general public, but rather to the existing shareholders. Option C is incorrect because a proxy is a document that allows one person to act on behalf of another in certain situations, such as voting at a shareholder meeting, but it is not a rights offering. Option D is incorrect because a rights offering is not a market claim that can be traded on an exchange, but rather an offer made directly by the company to its existing shareholders. Option E is incorrect because a rights offering has nothing to do with special perquisites being awarded to management.

A Rights Offering Is