Underwater Option Exchanges: Tender Offer Data Results

This presentation reviews tender offer results collected by Equity Methods for all known tender offers filed between 2005 and September 30, 2009.

The presentation provides summary analyses and trends from our internal database. Numerous companies of all sizes and across all industries have implemented option exchange programs, with a considerable uptick in 2009. While these programs are not appropriate for all companies, under the right circumstances they can provide a vehicle for restoring broken incentives. No two programs are alike, and the correct design and execution of an exchange program differs from case to case.

Based on our experience, the most successful programs are those in which deliberate case-specific analysis and planning were performed well in advance of the decision to actually obtain shareholder approval.