Contingent issuance

A contingent issuance refers to a possible issuance of common stock that will occur only if certain conditions have been satisfied. A business may set up a contingent issuance in order to make it more expensive for a hostile acquirer to buy it; thus, an event such as an offer to buy a majority of the shares outstanding will trigger the automatic issuance of more shares to existing shareholders, which the hostile acquirer must then purchase.

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