Steve jobs apple options backdating
CUPERTINO, California — October 4, 2006 — Apple® today announced that the special committee of its board of directors has reported its findings after a three month investigation into Apple’s stock option practices.The special committee of outside directors, together with independent counsel and accountants, examined more than 650,000 emails and documents, and conducted interviews with more than 40 current and former employees, directors and advisors.The company and its independent auditors are reviewing recent accounting guidance published by the SEC, and have not yet determined the amount of such charges, the resulting tax and accounting impact, or which periods may require restatement.The company continues to proactively inform the SEC of its findings.But the options scandal has never touched a more exciting company than Apple or a more thrilling executive than Jobs. In June 2006, a special committee of Apple outside directors, chaired by former Vice President Al Gore, hired its own attorneys to investigate options backdating at the company. It turns out there were literally thousands of examples of backdating at Apple—6,428 options grants on 42 dates over a period of several years.After accounting for forfeitures, Apple was forced to recognize stock-based compensation expense of 5 million on a pretax basis that it hadn't done so previously."If you are going to put a case against him, you had better be sure it's a strong case." To be sure, regulators have in the past gone after celebrity business leaders.
However, the purported board authorization was dated near the end of the year, suggesting that the benefits were both not properly authorized and were backdated. Jobs later surrendered his options before they were exercised, implying that he did not gain any direct benefit from them.These are now among the pieces of evidence being weighed by the Securities and Exchange Commission as it decides whether to pursue a case against the company or any individuals over the affair, according to these people.News of the irregularities, which is expected to be revealed in a regulatory filing by Apple before the end of this week, will add to pressure that has been growing on one of Silicon Valley’s most highly-regarded companies since the middle of 2005.The move came almost exactly a year after the SEC filed similar charges against former Apple CFO Fred Anderson and former general counsel Nancy Heinen.Anderson settled his case, but Heinen is still on the hook and expects to go to trial sometime next year.