The data that makes up the Pluris DLOM database comes from PrivateRaise, the leading source for comprehensive analysis of Private Investments in Public Equity (PIPEs), Shelf Registrations and Special Purpose Acquisition Companies (SPACs). PrivateRaise makes it easy to monitor and research transactions and the entities associated with these transactions.
Creating a Restricted Stock Study with the Pluris DLOM Database
One approach to calculating a DLOM from a restricted stock study based on the Pluris DLOM Database is included with the subscription to the database. It is important to note that this is only one approach of many possible approaches to calculating a DLOM based on the database. Every subscriber to the Pluris DLOM Database has access to the entire set of transactions and is free to use the data to provide empirical support to a DLOM based on any approach or theory favored by the valuator. What follows is an exposition of the approach included with the subscription to the data.
Using the Included Approach
The included approach is relatively easy to use. Since it employs a restricted stock study, the valuator must have a clear understanding of restricted stock and the impact of Rule 144[1].The valuator should have a firm grasp on the analyses that produce the inputs to the calculation of the DLOM, which are set out below. The valuator should also be able to restate the reasoning underlying the ‘two-step’ or RSED + PEDI approach. For a list of articles relating to observations from restricted stock studies and the development of the theory underlying the RSED and PEDI, see Appendix B: Developing the RSED and PEDI Concepts.
The valuator must also understand that the DLOM determined with the included method may not be the final answer. As the courts have noted in a number of cases, most notably Mandelbaum, the valuator is also responsible for considering other factors that might influence the DLOM. Because the included approach employs a restricted stock study, the valuator must have a clear understanding of restricted stock and the impact of Rule 1441. The valuator should have a firm grasp on the analyses that produce the inputs to the calculation of the DLOM, which are set out below. The valuator should also be able to restate the reasoning underlying the ‘two-step’ or RSED + PEDI approach. For a list of articles relating to observations from restricted stock studies and the development of the theory underlying the
RSED and PEDI, see Appendix B: Developing the RSED and PEDI Concepts.
The valuator must also understand that the DLOM determined with the included method may not be the final answer. As the courts have noted in a number of cases, most notably Mandelbaum, the valuator is also responsible for considering other factors that might influence the DLOM
[1] 1 As most valuators are aware, Rule 144 covers “Selling Restricted and Control Securities. Information available at SEC.gov | Rule 144: Selling Restricted and Control Securities