A more thorough explanation:

A rights offering is a type of securities offering where a company issues stock-purchase rights to its existing shareholders. These rights allow shareholders to buy newly issued stock at a fixed price, usually below market value, and in proportion to the number of shares they already own.

For example, if a company has 100,000 shares outstanding and decides to issue 10,000 new shares through a rights offering, each shareholder would receive one right for every ten shares they own. If a shareholder owns 100 shares, they would receive 10 rights, which would allow them to purchase 10 new shares at the fixed price.

The purpose of a rights offering is to give existing shareholders the opportunity to maintain their proportional ownership in the company and to raise capital without diluting their ownership. It is also a way for companies to reward their loyal shareholders by offering them the chance to purchase new shares at a discounted price.