62. What is the most important factor contributing to a shareholder’s decision to exercise her pre emptive right? a. a desire to inspect the register of share transfers b. a need to ask the court to appoint an inspector c. a desire to maintain her current level of control d. a need to know if directors are purchasing shares

1. What is the most important factor contributing to a shareholder's decision to exercise her pre

emptive right?

1. a desire to maintain her current level of control

A preemptive right allows the shareholders to maintain their control such as voting right in the company, even if new shares are issued. Normally, before the company offers the shares to a third party, the shareholders must first have the opportunity to purchase. This also protects investors from loss if the shares are issued at lower prices than initial shares hence retaining the initial control over the company operations