{"id":3402,"date":"2020-12-11T01:33:42","date_gmt":"2020-12-10T20:03:42","guid":{"rendered":"https:\/\/staging.trica.co\/equity\/blog\/?p=3402"},"modified":"2022-07-01T04:29:29","modified_gmt":"2022-07-01T04:29:29","slug":"fully-diluted-cap-table","status":"publish","type":"post","link":"https:\/\/trica.co\/equity\/blog\/us\/fully-diluted-cap-table\/","title":{"rendered":"What is a fully-diluted cap table?"},"content":{"rendered":"

A fully-diluted cap table is a version of the cap table that shows the total number of currently outstanding shares for each security and the totals from each convertible security if those were to be exercised. These convertible securities include stock options, convertible notes, compulsorily convertible debentures, and other shares waiting for an exercise event, such as ESOPs.\u00a0<\/span>
\nWhat purpose does a fully diluted cap table serve? <\/b>
\n<\/b>A non-diluted cap table does not highlight outstanding shares and the totals from unexercised securities. In actual exit events, these securities might get exercised or converted, leading to a drastic dilution. Investors, therefore, look into the fully-diluted cap table before making any investment decision.\u00a0<\/span>
\nIs this cap table accurate? <\/b>
\n<\/b>There might be instances when the exact number of shares cannot be determined as the exercise of underlying security might be based on certain conditions, such as a percentage of gross sales. In a case as such, the fully-diluted cap table will have footnotes highlighting the assumptions and specific conditions of exercise.\u00a0\u00a0<\/span>
\nWith respect to ESOPs, there are three possible angles to view \u2018full-dilution.\u2019 Footnotes are used to indicate if the ESOP formula is based on: <\/span><\/p>\n