C is corrent because stock warrants are issued to existing shareholders so that they can purchase additional shares of stock in order to maintain their ownership percentage.
A is incorrect because stock options are usually granted to officers and key employees as a form of compensation.
B is incorrect because stock dividends are a pro rata distribution of the corporation’s own shares of stock to existing shareholders based on their stock ownership. The effect of a stock dividend is to increase the number of shares outstanding without changing any shareholder’s ownership percentage.
D is incorrect because a stock subscription does not involve any rights to purchase additional shares of stock.
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