Share Rights Plans

question 39

Multiple Choice

Share rights plans

• A)vary in detail but are all designed to increase the cost of the firm to an unfriendly acquirer.
• B)with flip-in provisions allow existing shareholders to purchase additional shares at market value without incurring any transaction costs.
• C)require any unfriendly acquirer to exchange two shares in the target firm for every one share in the merged firm.
• D)allow shareholders to purchase additional shares at below market value at a time chosen by the rights holder.
• E)grant stock dividends to their holders in addition to the normal cash dividends.

---

Definitions:

Lord North

A British statesman who served as Prime Minister of Great Britain from 1770 to 1782, best known for his role during the American Revolution.

Revolutionary War

The Revolutionary War, also known as the American Revolution, was a conflict between Great Britain and its Thirteen Colonies in America, leading to American independence.

False Assumptions

Beliefs held without supporting evidence or in contradiction to facts, often leading to errors in judgment or misunderstanding.

Treaty of Paris

An agreement signed in 1783 that ended the American Revolutionary War, recognizing American independence from Britain, or, in a different context, the 1898 treaty that ended the Spanish-American War and involved Spain ceding territories to the United States.