If a shareholder does not subtract all or part of his or her share of shares in cash on the date indicated, the other shareholders may acquire those remaining shares. If a cash call leads to the acquisition of new shares by a shareholder, directly or via a loan convertible into shares, the net result is the dilution of the participation of shareholders who did not participate in the cash call. Automatic transfers are usually triggered when a shareholder dies; is convicted of a crime; dissolved or liquidated (if the shareholder is a corporation); declaration of insolvency; has terminated its employment relationship with the company (if the shareholder is also an employee); substantially violates the SHA; significantly violates other above-mentioned ancillary agreements that could harm the company; or, among other things, a breach of an obligation to the company. Shareholders can determine which acts or omissions trigger an automatic transfer and, as long as the SHA is clearly defined, they are binding. Most companies and shareholders prefer to conclude an agreement on the basis of the Law on Shares, which allows the provisions mainly in all other areas. In particular, it offers rights-based liability with liability to both parties, which helps the procedure tremendously. Another alternative approach to the fight against dilution is to issue jump warrants to investors who participate in dilutive financing. Jump warrants allow investors participating in dilutive financing to acquire the number of additional common shares that can be allocated to them under the current anti-dilution formula for a nominal amount. A shareholder agreement (SHA) is a contract between the shareholders of a company and often the company itself. A SHA defines the rights and obligations of shareholders, regulates the management of the company, the holding of shares, privileges, voting rights and various guarantees for shareholders. A SHA aims to bind shareholders to rules in order to prevent issues that could become controversial in the future. A SHA usually indicates the number of initial board members (and often their names and other details) and sometimes the rights of certain shareholders to appoint a certain number of board members..
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