Photo Credit: ShutterstockThe stockholder rights plan, or “poison pill,” is perhaps the most well-known arrow in the quiver of defensive measures available to corporate issuers. The basic premise is simple: poison pills prevent would-be acquirors from accumulating above a certain percentage of an issuer’s outstanding stock (the “trigger”) without suffering massive dilution. This dilution occurs through either a “flip-in” provision, in which unaffiliated stockholders can purchase the issuer’s stock for half price once the pill is triggered, or a “flip-over” provision, in which the issuer’s unaffiliated stockholders can acquire discounted stock of the acquiror in any merger or business combination.
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November 25, 2020 at 10:05PM
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'Acting-in-Concert' Poison Pills: This Pill Comes With a Silencer | New York Law Journal - Law.com
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