Warrants give the holder the right — not the obligation — to buy shares at a fixed price by a fixed date. They show up in three places most often: as kickers in a venture-debt facility, as standalone instruments granted to advisors or service providers, and as side terms on a financing. Octelligence records them as outstanding instruments on the cap table and turns each exercise into a real share certificate.
Warrants vs. options
Both warrants and options give the holder a right to acquire shares, and both flow into the same fully-diluted ownership totals. The differences in Octelligence:
- Option grants live inside an option pool with a vesting schedule. They're typically issued to employees and have grant agreements tied to your equity plan.
- Warrants are standalone — no pool, no vesting schedule. They're issued one at a time, usually to investors, lenders, or non-employees, and have their own warrant agreement.
If you're recording a grant to an employee against your equity plan, see Stock options with vesting. Use warrants for everything else.
Plan requirement. Warrants are a Growth-plan feature. They appear on the cap table on Growth and above, and flow into the fully-diluted ownership calculation.
Step-by-step
Open the Warrants register
From the corporation's workspace, open Financing › Warrants. You'll see every warrant on the cap table with its number, holder, strike, expiry, status, and quantity issued vs. exercised.
Add a new warrant
Click New warrant and enter:
- Holder — a person or organization. Pick from the People & Organizations directory or type a new name. If new, Octelligence creates the entry for you.
- Holder email (optional) — used if you later send the holder a copy of the warrant agreement.
- Share class — the class of shares the warrant entitles the holder to buy.
- Warrant number — leave blank to auto-assign (
WAR-0001,WAR-0002, …) or enter your own scheme. - Number of warrants — the underlying share count.
- Exercise (strike) price — the per-share price at exercise.
- Issue date — defaults to today.
- Expiry date — defaults to three years from the issue date; override per the agreement.
- Notes (optional) — context for the next person reading the register.
Save. The warrant appears in the register with status Issued and immediately flows into the cap table's outstanding-instruments totals.
Attach the warrant agreement
Open the warrant detail page and upload the signed warrant agreement to the attachments section. The agreement lives with the warrant for the life of the corporation, so it's available at diligence without anyone hunting through email.
Record an exercise
When the holder exercises, open the warrant and click Exercise. Enter:
- Quantity — the number of warrants being exercised in this event. Partial exercises are supported; you can run the action multiple times until the warrant is fully drawn down or expires.
- Exercise date — defaults to today.
- Certificate number (optional) — leave blank to auto-assign the next number in the corporation's certificate series.
On submit, Octelligence does four things in one transaction: decrements the warrant's outstanding quantity, issues a share certificate to the holder for the exercised shares, records an issuance event on the cap table linked back to the warrant, and writes the action to the activity log. If any step fails, the whole transaction rolls back.
Mark a warrant cancelled or let it expire
If the parties cancel a warrant (a debt facility is repaid early, a service agreement ends), open the warrant and mark it Cancelled. Any unexercised quantity stops counting against fully-diluted ownership.
Expired warrants are handled automatically: once the expiry date passes and there's outstanding quantity, the status becomes Expired and the warrant drops off outstanding totals. The historical record stays in the register.
What happens on the cap table
Outstanding warrants are visible on the cap table in two places:
- Outstanding instruments — a section summarizing every option, warrant, and SAFE currently outstanding, grouped by holder and class.
- Fully-diluted ownership (Growth and above) — issued shares + outstanding options + outstanding warrants + unallocated option pool. Warrants contribute their underlying share count to the fully-diluted denominator.
Exercised warrants flow into the issued-shares portion of the cap table through the new certificate. The link back to the originating warrant is preserved so an auditor walking the chain of title can see exactly where a certificate came from.
Common gotchas
Recording a warrant as a SAFE or vice versa. They look superficially similar — both are pieces of paper that turn into shares later — but the cap-table math and the conversion mechanics are completely different. SAFEs convert at a priced round at a price you don't yet know; warrants are exercised at a fixed strike you set today. If the document says "exercise price," it's a warrant.
Forgetting to set an expiry. Octelligence defaults to a three-year expiry if you leave the field blank; if your agreement says ten years (common for advisor warrants), set it explicitly. An incorrect expiry will quietly drop the warrant out of outstanding totals on the wrong date.
Exercising past expiry. Octelligence blocks the exercise action if the expiry date has passed. If a holder claims late exercise rights, document the basis (board approval, amendment) and adjust the expiry on the warrant before exercising.
Assigning warrant numbers manually then duplicating. If you prefer your own numbering scheme, keep it sequential and check the register before adding. Auto-assign is the safer choice when in doubt — Octelligence skips numbers already in use.