A contract wherein the bidding ﬁrm agrees to limit its holdings in the target ﬁrm is called a:
A)supermajority amendment.
B)standstill agreement.
C)greenmail provision.
D)poison pill amendment.
E)white knight provision.

Question

Quizplus · Accepted Answer

A standstill agreement is a contract in which a bidding firm agrees to limit its holdings in the target firm. This agreement can prevent a hostile takeover from occurring since it limits the acquiring firm's ability to purchase additional shares in the target firm.

A Contract Wherein the Bidding ﬁRm Agrees to Limit Its