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[1] [2] The act of creating new issued shares is called issuance. Allotment is simply the transfer of shares to a subscriber. Allotment is simply the transfer of shares to a subscriber. After allotment, a subscriber becomes a shareholder, though usually that also requires formal entry in a share registry .
An equity issuance is the sale of new equity or capital stock by a firm to investors.Equity issuance can involve a private sale, in which the transaction between investors and the firm takes place directly, or publicly, in which case the firm has to register the securities with the authorities and the sale takes place in an organized market, open to any registered investor, a process more akin ...
Original issue discount rules separate the portion of the repayment that is attributable to interest and then taxes that amount at ordinary income rates. These rules prevent the avoidance of tax that might otherwise be available by characterizing the repayment as a capital gain, which is taxed at a lower rate, or by deferring the recognition of ...
Deferred financing costs or debt issuance costs is an accounting concept meaning costs associated with issuing debt (loans and bonds), such as various fees and commissions paid to investment banks, law firms, auditors, regulators, and so on. Since these payments do not generate future benefits, they are treated as a contra debt account.
The par value of stock has no relation to market value and, as a concept, is somewhat archaic. [when?] The par value of a share is the value stated in the corporate charter below which shares of that class cannot be sold upon initial offering; the issuing company promises not to issue further shares below par value, so investors can be confident that no one else will receive a more favorable ...
A rights issue or rights offer is a dividend of subscription rights to buy additional securities in a company made to the company's existing security holders. When the rights are for equity securities, such as shares , in a public company , it can be a non-dilutive pro rata way to raise capital.
The term "issuer" means every person who issues or proposes to issue any security; except that with respect to certificates of deposit, voting-trust certificates, or collateral-trust certificates, or with respect to certificates of interest or shares in an unincorporated investment trust not having a board of directors (or persons performing ...
Book building is an alternative method of making a public issue in which applications are accepted from huge buyers such as financial institutions, corporations or high net-worth individuals, almost on firm allotment basis, instead of asking them to apply in public offer. Book building is a relatively new option for issues of securities, the ...