Option Grants Draw Scrutiny

Executives Receive Unusual Awards During Negotiations in Spate of Large Mergers

BY MARK MAREMONT

Numerous
companies have awarded stock options to their top executives while
engaged in negotiations to be acquired, according to academic research
and a Wall Street Journal review of company filings.

The
practice, which experts say appears to be legal under federal law,
typically results in the target firm's executives receiving a bigger
payout when the takeover is later announced.

An examination of
securities filings found unusual pre-deal options grants in a
half-dozen large mergers since 2007. The companies generally say the
options awards weren't timed to take advantage of the merger talks, but
instead were routine or stemmed from unrelated ..  http://online.wsj.com/article/SB125530435544579223.html?mod=googlenews_wsj