Spring-Loading Options

Delaware courts are beginning to analyze claims concerning the controversial practice of spring-loading options. Spring-loading is the granting of options just prior to the release of favorable company information (in the company's possession at the time of the grant). The options are granted at a market price on the day of the grant. They are said to be 'spring-loaded' because upon release of the favorable news, the stock price is expected to rise and the options would then become 'in-the-money.'

30 minute readApril 25, 2008 at 11:18 AM
By
Thomas J. Quigley
Steven S. Flores
Spring-Loading Options

Delaware courts are beginning to analyze claims concerning the controversial practice of spring-loading options. Spring-loading is the granting of options just prior to the release of favorable company information (in

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