Which of the Following Is Not a Correct Description of a Defensive

question 27

Multiple Choice

Which of the following is not a correct description of a defensive strategy to a tender offer?

• A) Selling a crown jewel refers to a sale by the target corporation of an asset that was particularly attractive to the tender offeror.
• B) A white knight merger refers to a merger with a different purchaser that is friendlier toward management than the company that made the tender offer.
• C) A poison pill is a strategy built into contracts,bylaws,and so forth,that can make any purchase of the corporation more expensive,such as leases that automatically expire upon the purchase and would require renegotiation,likely at a higher price.
• D) Under a standstill agreement,shareholders holding a large number of shares of the target corporation agree that none of them will sell to the tender offeror,even if the tender offeror raises the offer price.
• E) A greenmail payment is a payment,usually at greater than fair market value,made by the target corporation to the tender offeror for shares already owned by the tender offeror in exchange for the tender offeror dropping the tender offer.

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Definitions:

Scientific Attitude

An approach marked by curiosity, skepticism, and humility where one seeks to understand the natural world through empirical evidence and experimentation.

Humility

The quality of having a modest or low view of one's importance, often enabling individuals to remain open to learning and respecting others.

Skepticism

An attitude of doubting the truth of something, such as a claim or statement.

Curiosity

A strong desire to learn or know something, drawing individuals towards novel and challenging experiences or information.