Rights that allow stockholders to maintain their proportionate ownership of a corporation are called:

A) proportionate rights.
B) cumulative rights.
C) preemptive rights.
D) Both a and b above
E) All of the above

Preemptive Rights

A stockholder’s right to maintain her proportionate ownership in a corporation. The stockholder has the right to buy a share of any newly issued stock that is proportionate to her fractional ownership of the company before the new issue. The right is not a matter of law but must be written into the corporation’s bylaws.

Proportionate Ownership

Ownership shares in a company or asset divided among investors in proportion to their investment.