Numerous companies have awarded stock options to their top executives while engaged in negotiations to be acquired, reports the WSJ. The practice, which experts say appears legal under US federal law, typically results in the target company’s executives gaining a bigger payout when the takeover is later announced. Securities filings show unusual pre-deal options grants in a half-dozen large mergers since 2007. The companies generally say the awards were routine or stemmed from unrelated one-time events.

This entry was posted by Gwen Robinson on Monday, October 12th, 2009 at 4:52 and is filed under Capital markets. Edit this entry.