Good Question ; Exercising Backdated Stock Options Can Be a Liability

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Q. I received some stock options as part of my compensation. Is it worth it to exercise these options, or could I be liable if the company is investigated for backdating?

A. Dozens of executives and board directors at 19 companies recently have been fired or resigned as investigations of stock option backdating accelerate. Options - the right to buy company stock at a set price in the future - are widely used as an executive perk, especially in Silicon Valley. Backdating sets the date of the option grant to when the price was at a low point to ensure greater financial gain for the person getting the options.

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Good Question ; Exercising Backdated Stock Options Can Be a Liability

As someone who has received options, you would want to consider the grant price, the current share price and wheth...

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