Yep, from my experience in a past life, options were granted and a timeline assigned for expiration. If exercised, the person receiving paid the lower strike price and had to hold the shares for a preset amount of time.

Most of the rules are set up by the BOD. You are very right, the SEC frowns (I`m not sure they know how to do much else) at exercised options just prior to a material and predicable event. Especially if those option shares do not carry a preset holding period.

The bottom line: Insider activity is good sign, but not a sign of things to come very soon if those things could have been predicted i.e, settlement discussions or prior notice of a court event from an attorney or, watching the bamboo sticks being inserted under some mean ole copy cat`s fingernail, or watching a memeber of the J3 team cry for their Mommy, or, worse yet, soil themselves, or....(where`s Rash when you need him?)

John