Question

ABC Corporation has declared a rights offering to stockholders of record on Thursday, October 22nd, payable on Friday, November 6th. Under the offer, shareholders need 20 rights to subscribe to 1 new share at a price of $60. Fractional shares can be rounded up to purchase 1 full share. The last day to buy ABC shares before they go ex rights is:_______.

Answer 1

Answer:

November 6th is the last date to exercise the rights.

Explanation:

The shareholders have right to sell the rights to other shareholder, for which the shareholders need to exercise the rights before the right issue. If the shareholders doesn't makes any exercise of right issue before date then he is not entitled to rights anymore. The last date is the date on which the payment is made.