According to London’s Financial Times:
“Steve Jobs, chief executive of Apple Computer, was handed 7.5m stock options in 2001 without the required authorization from the company’s board of directors, according to people familiar with the matter.”
“Records that purported to show a full board meeting had taken place to approve Mr Jobs’ remuneration, as required by Apple’s procedures, were later falsified. 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.”
Apparently, stock option backdating, or the manipulation of a grant date in order to achieve a lower option exercise price, has become something of a widespread problem among companies and their CEOs. Apple admitted that Jobs had been “aware” of the backdating “in a few instances” and that he did not “receive or otherwise benefit from these grants and was unaware of the accounting implications.” Apple claims that Jobs surrendered the options before they were exercised and was given a grant of restricted stock instead.
Interestingly enough, reports indicate that Jobs has sought his own legal representation to deal with the matter. Naturally, this suggests that the SEC lawsuit is something to worry about.
