If Venu decides to join the listed AMC, which compensation package will you recommend and why? You

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If Venu decides to join the listed AMC, which compensation package will you recommend and why? You can use the Black Scholes model with the following additional assumptions:

a. Assume the probability that Venu will remain employed and eligible at the time of vesting are as follows: one-year vesting (90%), two-year vesting (70%), three-year vesting (60%), four-year vesting

(50%).

b. Assume the average time of exercise of the stock options to be the mid-point between the date of vesting and ten years from the grant date.

c. Given the small ratio of ESOPs to the total number of shares, ignore the dilutive effect of these options on the stock price.

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Related Book For  book-img-for-question

Cases In Corporate Finance

ISBN: 978-1032724485

1st Edition

Authors: Mayank Joshipura ,Sachin Mathur

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