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Anti Dilution

CategoryFinance

Clause TypeRed Flags

Definition

An obligation to retrospectively adjust the exercise price to avoid the dilution of a party's investment, triggered by an agreed event such as a new issuance of shares.

Example

In order to prevent dilution of the purchase rights granted under Section 1 hereof, the Exercise Price shall be subject to adjustment from time to time pursuant to this Section 2; provided, however, that under no circumstances will the Exercise Price be less than the then current par value of any share to be issued under this Warrant.