Anti-Dilution

In corporations and closely held companies, ownership is determined by the number of shares held. For example, a shareholder owning 1,000 shares in a company with 10,000 total shares has a 10% ownership stake. However, this ownership percentage can be threatened by dilution, a common concern for minority shareholders. For example, if the company issued an additional 10,000 shares, that 10% stake would then drop to 5% of the company.