Apple manages options probe damage
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Apple Computer Inc.'s  board  cleared Chief Executive Steve Jobs this week of any misconduct  over stock options accounting problems and Wall Street cheered  him for taking broad responsibility.
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Today's Schaeffer's Midday Options Update features Apple Computer  (NASDAQ:AAPL). The Midday Options Update contains a brief commentary on  the day's most notable activity and a table listing the most-active  calls and puts for the day.
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Apple Computer Inc. , which is undergoing an independent investigation into its historical stock option practices, filed with the U.S. Securities and Exchange Commission on Friday to delay its 10-K annual report filing.
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It turns out Apple didn't have much of a choice about charging for the January software update, according to analysts familiar with accounting regulations.
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Apple said an internal review found that Steven P. Jobs knew the company was backdating stock options to inflate their value.
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Federal prosecutors are strongly  considering criminal charges against former executives of  Broadcom Corp., Apple Inc., and KLA-Tencor Corp., related to  the backdating of stock options, the Wall Street Journal  reported on Friday, citing people familiar with the situation.
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Apple offers compensation to customers who have already bought an iPhone after the firm cut $200 off the price.
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Apple Computer Inc.'s  board cleared Chief Executive Steve Jobs this week of any misconduct over stock options accounting problems and Wall Street cheered him for taking broad responsibility.
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McAfee has taken two major steps toward closing the stock-option backdating scandal that has plagued the company for the past two years.On Friday, the security vendor filed 10 years&#39; worth of restated financial reports, a process that was set off by the scandal. The company also said it had reached a tentative settlement in a class-action lawsuit relating to its accounting practices.Charges for the restatement will be $137.4 million. McAfee has also set aside $13.8 million to cover lawsuits filed in 2006 on behalf of McAfee shareholders, the company said in a statement released on Friday.McAfee is one of more than 100 U.S. companies that have been investigated by the U.S. Securities and Exchange Commission (SEC) for improper backdating of options. In backdating, companies would alter the date that stock options grants were made to certain employees so they could be purchased at a lower price and ultimately sold by the employee at a greater profit. The practice, while not illegal, was often improperly disclosed in regulatory filings, leading to SEC investigations of many high-profile companies, including Apple, Dell and Broadcom.Earlier this year, McAfee&#39;s former legal counsel, Kent Roberts, was indicted on fraud charges related to the scandal.The restated reports cover the period from 1995 until the first quarter of McAfee&#39;s fiscal 2006 year. The company has also filed 10-Q reports for the first three quarters of its fiscal 2007 year, putting it up-to-date with the SEC for the first time since March 2006.
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THE REGION Sapient Corp., a technology consulting company, said the Securities and Exchange Commission is investigating the company's stock options granting practices. Sapient will cooperate fully with the commission, the Cambridge company said in a regulatory filing. Sapient said last month that an internal review of the practices had ended and found no misconduct.
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(InfoWorld) - Graphics chip maker Nvidia found some irregularities in past stock-based compensation practices during an internal probe, and took a total of $127 million in non-cash charges over associated expenses, the company said Wednesday. The figure fell within theÂ $150 million chargeÂ Nvidia said it might have to take. The company also amended financial results for its fiscal year 2006 and the first two quarters of 2007 as a result of the internal probe. The non-cash charge and amendments to previous financial statements ends its internal probe, but an inquiry by the Securities and Exchange Commission (SEC) remains ongoing, Nvidia said. The restated earnings reports did not have a material impact on Nvidia's operating results, it said. The company plans to cooperate fully with the SEC. A number of technology companies have launched reviews over stock-based compensation to employees, finding instances in which stock options have been dated back to a time when the stock had hit a low. The practice is unfair to shareholders and was made almost impossible to legally execute by Sarbanes-Oxley, and for good reason. Stock options were designed as a way for employees to share in the success of the company and give them an added incentive. But by back-dating the options, employees -- often executives -- were essentially given shares that were already valuable. So far, stock options probes, carried out either by companies themselves or by the SEC, have affected over 160 companies.Â Investigations at memory chip developer RambusÂ andÂ security software vendor McAfeeÂ  have led to the resignation or firing of top executives.Â Apple ComputerÂ could be kicked off the Nasdaq by Dec. 29 if it fails to submit its SEC Form 10-Q for the quarter ended 1 July 2006, and any required restatements linked to its stock options probe by that time. Other companies have faced shareholder lawsuits over the issue.
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Apple Computer Inc. CEO Steve Jobs apologized to shareholders Wednesday after an internal investigation found that he had been aware of the company's practice of "backdating" employee stock options.
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Federal prosecutors are strongly considering criminal charges against former executives of Broadcom Corp., Apple Inc., and KLA-Tencor Corp., related to the backdating of stock options, the Wall Street Journal reported on Friday, citing people familiar with the situation.
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Apple Computer Inc.  said on  Wednesday it found irregularities with its past stock option  grants during an internal investigation and the company will  likely need to restate its past financial statements.
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Apple Computer Inc.  said on  Wednesday an internal investigation found irregularities with  its past stock option grants, prompting the immediate  resignation of a former chief financial officer from the board  of directors.
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Portable media player maker Creative Technology Ltd. said Wednesday the U.S. International Trade Commission agreed to investigate whether Apple Computer Inc.&#039;s rival iPod infringes on one of its patents.
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(InfoWorld) - Apple CEO Steve Jobs has been subpoenaed by the U.S. Securities and Exchange Commission (SEC) to give a deposition in the stock option backdating lawsuit against former Apple General Counsel, Nancy Heinen. Citing two sources familiar with the case,Â Bloomberg reportsÂ that the subpoena is not part of an SEC investigation. Jobs' testimony is required as part of aÂ lawsuit brought against Heinen by the SECÂ in April 2007. Heinen is the only former Apple executive charged in the backdating scandal.Â Apple's internal investigation cleared all current executivesÂ of any wrongdoing and the SEC reached a deal with former CFO Fred Anderson in the case. Apple representatives were not immediately available to comment. The SEC says that Heinen granted 4.8 million options to six Apple executives, including herself, Anderson and CEO Steve Jobs, in February 2001. To avoid reporting an US$18.9 million compensation charge, Heinen backdated the options to January 17 when the company share price was much lower, the SEC said. She then told her staff to prepare false documents showing the board of directors had acted on that day. Later, in December 2001, the company granted 7.5 million options to Jobs. Again, Heinen avoided a $20.3 million charge by drafting minutes for a fake board meeting she said happened on Oct. 19, the SEC said. That meeting had never occurred. Heinen has maintained her innocence in the case and a statement by her lawyers said, "Nancy Heinen's integrity is unimpeachable."Apple's backdating problems started in June 2006, when the company announced thatÂ an internal probeÂ had found some irregularities in some option grants issued between 1997 and 2001. Four months later, Apple said a special committee hadÂ found irregularities in 15 of the grantsÂ made between 1999 and 2002. The internal investigation also found that Jobs was aware that favorable grant dates had been selected but didn't receive or benefit from those grants and was "unaware" of the accounting implications. In late December,Â Apple disclosed more backdating-related news,Â again clearing current executives and taking an $84 million charge on its restated earnings. Macworld is an InfoWorld affiliate.