The Los Angeles Stockholders' Rights Plan of Data scope Corp., often referred to as a "poison pill," is a defensive strategy implemented by the company to protect stockholders' rights in the event of an unsolicited takeover attempt. This plan aims to deter corporate raiders and provide the board of directors with sufficient time to evaluate offers that may not be in the best interest of the company and its shareholders. The main purpose of the Los Angeles Stockholders' Rights Plan is to grant shareholders certain rights and privileges, ensuring they have a fair say in major decisions regarding the company's future and potential change of control. By doing so, it aims to maintain stability and safeguard shareholder value. Key features of the plan include the issuance of rights to existing shareholders which allow them to purchase additional shares at a discounted price if a hostile acquisition bid surpasses a pre-determined threshold. This provision considerably dilutes the acquiring entity's stake in the company and makes the takeover economically unattractive. There are several variations of the Los Angeles Stockholders' Rights Plan. One common type is the "flip-in" plan, where shareholders other than the acquiring party have the option to purchase the target company's stock at a reduced price. This type of plan significantly increases the cost of the attempted takeover for the acquirer while maintaining the shareholders' interests. Alternatively, there is a "flip-over" plan, which grants shareholders the right to purchase the acquiring company's stock at a discounted price in the event of a successful takeover. This allows shareholders to benefit from the new entity's growth and potential synergies. Overall, the Los Angeles Stockholders' Rights Plan of Data scope Corp. serves as a protective measure to ensure that stockholders have a fair and equal opportunity to participate in the decision-making process during a potential takeover or change of control. By granting them additional rights and diluting the influence of potential acquirers, the plan aims to safeguard the long-term interests of the company and its shareholders.