Richards Layton & Finger

Delaware Law Developments: Stock Option Backdating and Spring-Loading

May 2007

In Recent Opinions, the Delaware Court of Chancery Has Denied Motions to Dismiss Stockholder Complaints that Directors Who Approved Backdated or Spring-Loaded Options Had Breached Their Fiduciary Duties to their Corporations and Stockholders. The Authors Discuss These Cases and Review Other Possible Challenges to Option Grants under Delaware Law.