What are Underwriters Warrants?
Underwriter’s warrants constitute a mode of compensation that may be granted to an underwriter by a company that issues stock. Essentially, the corporation will issue common stock warrants directly to the underwriter as part or all of the compensation involved with arranging the sale of the stock to the general public. Underwriter’s warrants allow underwriters the right of access to a fixed amount of shares, often at a price that is below the initial offering price made to the public. Because underwriter’s warrants are compensation through the issue of common stock warrants to the underwriters, it is important to understand what constitutes a common stock warrant. Essentially, a warrant of this type provides the holder of the warrant the right to purchase shares of common stock that are issued by a given corporation. While terms and conditions may vary slightly based on laws governing financial transactions in the jurisdiction of origin, the common stock warrant normally provides some
Underwriter’s warrants constitute a mode of compensation that may be granted to an underwriter by a company that issues stock. Essentially, the corporation will issue common stock warrants directly to the underwriter as part or all of the compensation involved with arranging the sale of the stock to the general public. Underwriter’s warrants allow underwriters the right of access to a fixed amount of shares, often at a price that is below the initial offering price made to the public. Because underwriter’s warrants are compensation through the issue of common stock warrants to the underwriters, it is important to understand what constitutes a common stock warrant. Essentially, a warrant of this type provides the holder of the warrant the right to purchase shares of common stock that are issued by a given corporation. While terms and conditions may vary slightly based on laws governing financial transactions in the jurisdiction of origin, the common stock warrant normally provides
