CFA Practice Question
"Shark repellents" include:
II. Requiring super-majority approvals for certain resolutions to be approved by the shareholders.
III. Staggered change of the board of directors.
IV. Poison pills.
I. Restricted voting rights to new shareholders.
II. Requiring super-majority approvals for certain resolutions to be approved by the shareholders.
III. Staggered change of the board of directors.
IV. Poison pills.
Correct Answer: I, II and III
Shark-repellent: Amendments to the corporate charter, which will make the firm very unattractive or difficult as a target. It also includes fair-price amendments.
IV is a rights-based defense mechanism.
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