Question: True or false? To avoid an entrenched management team, a stockholder friendly charter should include a shareholder rights provision, better described as a poison pill.

True or false?

To avoid an entrenched management team, a stockholder friendly charter should include a shareholder rights provision, better described as a poison pill. These provisions give the shareholders of target firms the right to buy a specified number of shares in the company at a very low price if an outsider acquires a certain percentage of the firm's stock.

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