Cap Table & Equity Docs: The Folder Every Acquirer Opens First

The cap table is the first folder an investor or acquirer opens — and they don't take your spreadsheet at face value. They verify it against the equity documents behind every line: the PAS-3 filings, the SHA and SSA, term sheets, the founders' agreement with vesting, share certificates, and the ESOP plan and grants. A cap table that reconciles cleanly to these documents makes diligence fast; one that doesn't raises questions about everything.

Why the cap table gets verified, not trusted

Your cap-table spreadsheet is a summary. Diligence checks whether that summary is legally true — whether each allotment actually happened, was filed, was priced correctly, and is reflected in valid documents. They reconstruct ownership from the statutory and contractual record and compare it to your numbers. Any mismatch — a missing PAS-3, an unissued certificate, an undocumented ESOP grant — means the spreadsheet can't be relied on, and the lawyer has to chase the truth.

The equity-document set, and what each one proves

Cap table reconciled to PAS-3

The summary, tied to a filed PAS-3 for every allotment. This is the backbone — get it right and most of the section follows.

Shareholders' Agreement (SHA) and Share Subscription Agreement (SSA)

The SHA governs shareholder rights, transfers, reserved matters and exit; the SSA is the contract under which investors subscribed. They define who really controls what — and surprises here (an unusual liquidation preference, a forgotten veto) can affect deal terms.

Term sheets

The prior-round term sheets, showing the agreed economics that the definitive documents implemented.

Founders' agreement with vesting and cliff

Proves the founders' equity is subject to vesting — which investors want, because it protects the company if a founder leaves early.

Share certificates + stamp duty

Physical/dematerialised certificates issued to every holder, with stamp duty paid. Missing or unstamped certificates are a common, avoidable gap.

ESOP plan, pool and grant letters

A board-approved ESOP plan, the pool size reflected in the cap table, and individual grant letters with vesting. The dilution math has to be verifiable — and the tax treatment understood. (Model it with BenefitStack's ESOP calculator.)

Valuations

The Rule 11UA reports supporting each issue price, which also have to reconcile with any FEMA filings.

A note on equity math vs equity documents

There's a difference between managing the live cap-table math (modelling rounds, options, waterfalls) and holding the equity documents a diligence asks for. Dedicated cap-table tools handle the math; what diligence actually opens is the document folder — the signed, filed, stamped artifacts. Keep both, but don't assume a cap-table tool alone makes you diligence-ready on the document side.

Keep the equity data room complete as you go

ComplianceStack maintains the equity-document data room — SHA, SSA, term sheets, founders' agreement, share certificates, ESOP plan and grants — as evidenced, standing items in your diligence pack, reconciled to your PAS-3 filings. So the first folder an acquirer opens is already complete. Get your free compliance health check.