Stock Option "Springloading": An Examination of Loaded Justifications and New SEC Disclosure Rules‪.‬

I. INTRODUCTION Since 2006, corporations have come under fire for using what has been dubbed "stock-options fraud" (1) as part of their executive compensation packages. The practices of option "backdating" (2) and "springloading" (3) have received widespread attention from government regulators: Congress has heard testimony about these matters, (4) and some senators have made statements about possible legislative action to address public concerns. (5) Recently, the U.S. Securities and Exchange Commission (SEC) enacted new reporting rules requiring public corporations to disclose, in detail, the role that options play as part of executive compensation packages in an effort to improve transparency in the use of options. (6)