Suppose the client had intentionally planned not to sign the promissory note because it had told its joint venture partner that the funds were an equity contribution that did not have to be repaid. Thus, it appears that either a spring loading and bullet dodging are not widespread or b these practices typically fail to lock in substantial gains for the option recipients. I believe that only a minority of firms that have engaged in backdating of option grants will be caught. However, such confusion may generally be avoided by disclosing on the face of the document that it was executed after the stated date.
Search Backdating Contracts: Everything You Need to Know Backdating a contract should not be done lightly because it easily can be considered a criminal offense that carries quite hefty consequences. Unless corporate insiders can predict short-term movements in the stock market, my results provided further evidence in support of the backdating explanation. This article discusses when legal documents might be backdated and how legally to do so when it is appropriate.