Option spring-loading

{
  "id": "MLC-T-INS-002428",
  "term": "Option spring-loading",
  "field": "Insurance and risk management",
  "definition": "The practice of granting stock options to executives shortly before the release of positive, non-public information that is expected to increase the company's stock price. This timing allows the recipient to benefit from the subsequent price appreciation, as the option's exercise price is set at the lower, pre-announcement market value. Regulators and courts have scrutinized the practice as a potential breach of fiduciary duty or a form of insider trading.",
  "url": "https://mlchart.com/terminology/insurance/option-spring-loading/"
}