Rights may be issued to all of the shareholders of an issuer (or all the holders of a particular class of stock) to purchase additional shares on a pro rata basis and having a term of no more than 90 days following the date of issuance, provided the exercise price is not so low in relation to the price as calculated in Section 260.140.50 of these rules as to be unreasonably prejudicial to those shareholders unable to exercise or sell their rights and provided that the relative equity positions of different classes of outstanding shares shall not be unfairly prejudiced thereby. An exercise price, which is not more than 15% below the price as calculated in Section 260.140.50, is presumptively reasonable under this section. Such rights to shareholders shall be freely transferable.

Note: Authority cited: Section 25610, Corporations Code. Reference: Section 25140, Corporations Code.

History

1. Amendment filed 5-3-83; effective thirtieth day thereafter (Register 83, No. 19).

2. Amendment filed 2-11-85; effective thirtieth day thereafter (Register 85, No. 7).