PREEMPTIVE RIGHT Definition

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PREEMPTIVE RIGHT is the right of a current stockholder to maintain the percentage ownership interest in the company by buying new shares on a pro rata basis before they are issued to the public.

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ORDINARY ASSET is a non-capital asset used for business purposes. See CAPITAL ASSET.

EFFECTIVE MATURITY is the date used in place of the final maturity for bonds with call, put or prepayment features. This date mathematically incorporates the effect of those optional maturity dates.

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