TERP is the theoretical ex-rights price, the value-conserving share price after a rights issue adjusts for the new shares and the capital raised. It is the weighted average of the pre-rights market price and the subscription price, weighted by old and new shares. The value of one right follows from the drop between the cum-rights price and TERP under standard formulas. Confusing TERP with the subscription price alone misses the dilution math.