Anti Dilution Comparison
Compare full-ratchet and broad-based weighted-average down-round conversion prices.
Description
Anti-dilution scenarios can reset a preferred conversion price through full ratchet or weighted averaging.
Anti-dilution scenarios can reset a preferred conversion price through full ratchet or weighted averaging. The share basis controls the weighted-average result.
Compare full-ratchet and broad-based weighted-average down-round conversion prices.
When to use Anti Dilution Comparison
Use this for the following task: Compare full-ratchet and broad-based weighted-average down-round conversion prices.
Prepare the scenario values in one currency and consistent time periods. Use fractions for fraction fields and percentage points for percent fields.
How to use Anti Dilution Comparison and understand its results
- Prepare the scenario values in one currency and consistent time periods. Use fractions for fraction fields and percentage points for percent fields.
- Enter oldConversionPrice, newIssuePrice, premoneyShares, newShares using the field table, then run the tool.
- Read fullRatchetPrice, weightedAveragePrice. Interpret flags, units, ordering and placeholder values using the rules below.
- Review any reported issue or failed check, correct the supplied values when appropriate, and verify the result in its intended context.
| Input field | Meaning | Value type and bounds | Requirement |
|---|---|---|---|
| oldConversionPrice | Old conversion price | number | Required |
| newIssuePrice | New issue price | number | Required |
| premoneyShares | Premoney shares | number | Required |
| newShares | New shares | number | Required |
Use positive prices and pre-money shares with nonnegative new shares. Leave weighted price unchanged for non-down rounds, otherwise apply the supplied broad-based capitalization formula.1
ratchet=min(oldPrice,newPrice); weighted=oldPrice(A+newShares×newPrice/oldPrice)/(A+newShares) in a down round This summarizes the declared operation. Units, indexing, inclusivity and exceptional cases are explained in the surrounding text.
| Output field | Meaning | Value type |
|---|---|---|
| fullRatchetPrice | Full ratchet price | number |
| weightedAveragePrice | Weighted average price | number |
{
"input": {
"oldConversionPrice": 2,
"newIssuePrice": 1,
"premoneyShares": 1000,
"newShares": 1000
},
"output": {
"fullRatchetPrice": 1,
"weightedAveragePrice": 1.5
}
}Limitations and assumptions
Excluded securities, carve-outs and legal contract definitions are not interpreted. Full ratchet follows the lower-price rule even if newShares is zero.
These outputs describe the supplied scenario; accounting definitions, capitalization terms and time periods must match the intended use. Malformed requests produce input errors. A successfully evaluated request can still contain false flags, empty result lists or a result outside the supplied threshold; those outcomes have the meanings stated above.
Alternative or Complementary methods
Choose Premoney Option Pool Dilution for this operation: Solve a pre-money option-pool top-up for a target post-money unallocated pool fraction. For a complementary task, use Nonparticipating Preferred Payout for this operation: Model one nonparticipating preferred class choosing liquidation preference or conversion.
The implementation reference documents the exact calculation, supported input shapes and returned fields.
References
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Anti Dilution Comparison — tool.io
Similar or alternative tools
- Premoney Option Pool Dilution
Solve a pre-money option-pool top-up for a target post-money unallocated pool fraction.
- Nonparticipating Preferred Payout
Model one nonparticipating preferred class choosing liquidation preference or conversion.