Startup Survival Guide

Video Lessons: Shareholders’ Agreement Clauses: What is an Anti-dilution clause?

In our new ‘Video Lessons’ blog series we share knowledge for both startups and investors in a short video format. The next couple of video lessons will be dedicated to the shareholders’ agreement. The shareholders’ agreement is a contract between all shareholders. It defines additional agreements which lie outside of the articles of your legal entity and sets the rules of the working relationship. When a shareholder has a so-called anti-dilution right this means that, in some circumstances, he/she gets extra shares. In particular, the shareholder is protected against the declining prices of the shares in a downround, or against the declining percentage of the shares when new shares are issued.

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