Which one of the following generally has a flip-in provision that significantly increases the cost to a shareholder who is attempting to gain control over a firm?
A) Golden parachute
B) Standstill agreement
C) Greenmail
D) Poison pill
E) White knight

Question

Quizplus · Accepted Answer

A poison pill provision is designed to make it more difficult or expensive for a shareholder to acquire a controlling interest in a company. A flip-in provision allows existing shareholders to purchase additional shares at a discount if an investor acquires a certain percentage of the company's shares. This significantly increases the cost to the investor attempting to gain control, thus discouraging a hostile takeover attempt.

Which One of the Following Generally Has a Flip-In Provision