The Stock Option Backdating Scandal: Lessons For Privately Held Companies

Law360, New York (October 20, 2006, 12:00 AM EDT) -- The publicity surrounding backdating of stock option grants has focused on publicly traded companies. However, even privately held companies should learn from the questionable practices that have come to light and adopt procedures that prevent these concerns. In this article, we identify some of the practices that have created problems, explain why these matter to even privately held companies and suggest best practices to avoid issues.

* What is backdating? *

In general, this term used as a catch-all to refer to various practices that resulted...
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