Pro Rata

Pro Rata is a Latin term that means “in proportion” or “according to a specific ratio or share” and is used to allocate or distribute resources, benefits, or obligations proportionally among multiple parties based on their respective ownership, interests, or contributions. Pro rata allocations ensure fairness, equity, and consistency in dividing assets, liabilities, or opportunities among stakeholders in accordance with their relative ownership or entitlements. Pro rata calculations are commonly used in financial transactions, distributions, dividends, subscriptions, and rights offerings.