Poison put


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Poison put

A covenant allowing the bondholder to demand repayment in the event of a hostile takeover.

Poison-Put Bond

A bond that allows bondholders to redeem before maturity at a high price should certain, named events take place. These events commonly include restructuring, a leveraged buyout, an attempted hostile takeover, or paying dividends in excess of a certain amount or percentage. Poison-put bonds can act as an anti-takeover measure; they help management discourage takeovers by raising their expense. On the other hand, when the company is going through a difficult time, poison-put bonds can limit management's restructuring options for the same reason.
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References in periodicals archive ?
Edelson said that some shareholders are now being told by the Company or its associates or representatives that if the Gold Committee's slate is elected, that the poison put provision might be invoked.
Mr Ruddock said illegally placing poison puts wildlife, pets and potentially people at risk.
It is too early to know the extent to which poison puts will be used and how effective they will be.