What is the primary purpose of a rights issue for a listed company?

To increase brand visibility To reward loyal customers To raise additional capital To acquire a competing business

How are Rights Entitlements (REs) typically allocated to existing shareholders?

Randomly through a lottery system Based on their investment portfolio diversity In proportion to their existing shareholding Through a first-come, first-served basis

What is one of the key advantages of the Rights Entitlement (RE) process compared to traditional methods?

It allows companies to issue shares at a premium It eliminates the need for shareholder approval It significantly reduces the timeline for rights issues It guarantees higher returns for existing shareholders

What options do eligible shareholders have regarding their Rights Entitlements?

They can only sell their rights in the secondary market They can only apply for the rights issue They can choose to either apply for the rights or sell them They are obligated to participate in the rights issue

What happens to Rights Entitlements if a shareholder chooses not to apply for the rights issue or sell them in the secondary market?

They are automatically transferred to a charitable organization They are converted into bonds with a fixed interest rate They are returned to the company for reallocation They expire and become worthless

In the context of rights issues, what does the term "tranche" refer to?

The discount offered on the rights shares The ratio of new shares to existing shares An installment payment for partly paid-up shares The brokerage fee associated with trading rights