Options Exchange Advisory

This service is designed to help US corporations deal with situations where there is a high stock option overhang and a significant number of outstanding options are “underwater.” One approach is to implement a stock option exchange program whereby outstanding options are cancelled and replacement grants are issued, subject to shareholder approval.

The corporate solutions team will:

• Review your preliminary option exchange proposal using widely accepted proxy voting guidelines and highlight potential areas of concern
  
• Help you structure an exchange program that is “value for value” and not dilutive to shareholders, utilizing a binomial option pricing model
  
• Provide suggestions on the presentation of the option exchange program in the proxy statement

In accordance with our Business Practices, this solution is delivered by ISS Corporate Services, Inc. (ICS), a wholly owned subsidiary of RiskMetrics Group, Inc.