Analysis Group has extensive experience in valuing employee stock options and other equity instruments. We perform valuations both in response to litigation, such as backdating investigations to determine option valuation and associated damages, and in the context of corporate reporting.
We use sophisticated modeling techniques to evaluate a variety of situations. For example, Analysis Group has developed Modified Black-Scholes and binomial lattice-based models for valuing traditional employee stock options and nontraditional instruments, including discount, capped, indexed, and performance-based options, and traditional and performance-based versions of restricted stock, restricted stock units, and stock appreciation rights.
We have used these models to help companies meet their option valuation needs, both in litigation and in complying with Global Accounting Standards.
Analysis Group has worked closely with outside counsel on issues related to the value and timing of option grants We have assessed the types of civil actions firms might face relating to backdating and other option-granting practices, analyzed patterns of option grants using various statistical techniques, including those used by leading academics, and developed the appropriate framework and model (lattice-based or Black-Scholes) to calculate the value of actual and “but-for” option grants.