Each common share held by every holder other than the acquirer is good for one right. This includes any future shares that will be issued as well. I can understand why we would not want a take over bid too early in the game. However a poison pill might be a bad thing. I guess it would all depend on the integrity of the Management of the company along with the BOD. This is an excerpt from Wikipedia
A shareholder who can reach a 20% threshold will potentially be a takeover bidder. If every other shareholder will be able to buy more shares at a discount, such purchases will dilute the bidder's interest, and the cost of the bid will rise substantially. Knowing that such plan could be called on, the bidder could be disinclined to the takeover of the corporation without the board's approval, and will first negotiate with the board so that the plan is revoked.
Shareholder rights plans, or poison pills, are controversial because they hinder an active market for corporate control. On the other hand, giving directors power to deter takeovers puts directors in a strong position to enrich themselves, as the directors may have to be compensated for the price of consenting to a takeover.
