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Backdating and its variants constitute failure to disclose compensation, which violates generally accepted accounting principles and the Sarbanes-Oxley Act.

Interestingly, companies involved in options backdating do not make easy targets for securities class actions because there usually has not been a significant stock decline after public disclosure of the backdating, and thus no basis for class-wide damages.

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First, D&O policies typically exclude coverage where a claim arises out of:* fraudulent or willful conduct of the insured* an insured's gain of a personal profit to which he or she was not legally entitled* insider trading In addition, certain D&O policies exclude claims arising out of the remuneration received by an insured without appropriate approval of the shareholders.

Few, if any, of these backdating claims have been settled to date, and, for the most part, D&O insurers have not been called upon to provide anything other than defense cost advancement in the pending cases.

The American National Red Cross is registered as a 501(c)(3) non-profit organization.

Contributions to the American National Red Cross are tax-deductible to the extent permitted by law.

Notably, however, many of the exclusions in D&O policies do not apply until the conduct that would trigger the exclusion is established by a factual finding or a "final adjudication." Although the wordings of D&O policies differ slightly in this regard, it is generally understood that a "final adjudication" trigger refers to the point at which a finding or judgment cannot be appealed further, and the time for appeal or reconsideration has expired.