Valleywag
Fred was told by Steve Jobs in late January 2001 that Mr. Jobs had the agreement of the Board of Directors for the Executive Team grant on January 2, 2001. At the time Mr. Jobs provided Fred this assurance, Fred cautioned Mr. Jobs that the Executive Team grant would have to be priced based on the date of the actual Board agreement or there could be an accounting charge. He further advised Mr. Jobs that the Board would have to confirm its prior approval in a legally satisfactory method. He was told by Mr. Jobs that the Board had given its prior approval and the Board would verify it. Fred relied on these statements by Mr. Jobs and from them concluded the grant was being properly handled.
Fred understood that, under Apple's stock option plan and accounting rules at the time, a grant date could be moved to a later date than the date of the actual grant decision and that there would be no compensation expense as long as the stock price on the new date was higher than the price on the original date. Apple's 1998 Executive Officer Stock Option Plan provided in Section 16 that 'The date of grant of an Option...shall be, for all purposes, the date on which the Administrator (in this case the Board) makes the determination granting such Option...or such later date as is determined by the Administrator '. Mr. Anderson understood that the date of grant was to be moved forward pursuant to this provision from January 2 to January 17 to avoid any appearance of impropriety that might arise from a grant awarded just prior to the stock price rise that resulted from the 2001 MacWorld exhibition and Mr. Job's keynote speech at the exhibition on January 9. He further understood that the January 17 date was selected by Mr. Jobs and Ms. Nancy Heinen, the former General Counsel, and that the stock price on January 17 was higher than the price on January 2.
Finally, Mr. Anderson understood that the Board of Directors, which consisted of sophisticated corporate executives of national stature, including the former Chief Financial Officer of IBM, verified the January 17 date by signing in early February 2001 a Unanimous Written Consent (UWC) with an effective date of January 17. It now appears the Board may not have given the necessary prior approval to the grants, contrary to what Mr. Anderson understood from Mr. Jobs and from the Board's signing of the UWC with an effective date of January 17.
Steve Jobs in regulators' sights
Disclosure. I just sold all my Apple stock, before writing this post. (The stock is soaring, but I can't believe traders have properly digested the news.) Steve Jobs, the company's hugely valuable chief executive, must now be squarely in the sights of securities regulators. Fred Anderson, the company's former chief financial officer, has turned on his former boss in order to save his own skin. It emerged this morning that he'd done a deal with the Securities and Exchange Commission, disgorging just $3.5m of his personal gain from Apple's sleazy stock option program. If that was it, Apple would be home free. But, in a statement just released, Anderson says Jobs ignored his warnings about fixing the date on executive options, a technique which built in profit for executives from the get-go; and accuses the Apple chief executive of misleading him about the necessity for board approval of the grants. The key passage, below. More, much more, later. But, now, hurry.
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11:55 AM on Tue Apr 24 2007
By Nick Denton
6,849 views
13 comments
Comments
"Disclosure. I just sold all my Apple stock"
OH Snap!
Disclosure. I just shorted all my Apple stock
If the CFO agreed with the SEC to cooperate, wouldn't the agreement include an obligation for the CFO not to disclose his evidence against Jobs? I think the disclosure argues in favor of their NOT being a cooperation agreement. Any lawyers out there?
It was kind of ridiculous for Apple to argue His Steveness was unaware of this initially. He designs the freakin' product launch t-shirts, so of course he picked the dates for the options.
I just hope the scrumptuous Ms Heinen doesn't get sent down to spend some time with butch lesbos in the clink.
Still it's amazing how flappy-mouthed you can become when you fork out $3.5 million and (presumably) some kind of immunity deal.
I doubt he's in their sights at all. Do you really think that they would allow Anderson to publicly disclose this information if they were going to use it against Jobs? (rhetorical question; the mere fact that its been disclosed implies that the SEC didn't find it credible) This is just a CFO that was caught trying to pass the buck. (don't misconstrue that as me saying Jobs didn't do anything wrong, because he may have.)
Let's follow along!
http://finance.google.com/finance?q=AAPL
And someone doesn't have a clue. Fred's just explaining himself: this is no bombshell. His statement is perfectly in accord with Apple statements and what the SEC knows. Check this article:
http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=u...
"The U.S. Securities and Exchange Commission said on Tuesday it would not file an enforcement action against Apple Inc. (AAPL.O: Quote, Profile , Research) in connection with the agency's stock-options dating investigation, citing the company's "extraordinary" cooperation.
"Apple's cooperation consisted of, among other things, prompt self-reporting, an independent internal investigation, the sharing of the results of that investigation with the government, and the implementation of new controls designed to prevent the recurrence of fraudulent conduct," the SEC said in a statement."
Valleywag should stick to trashing Robert Scoble and rumors about who's hooking up with who and leave the stock market to someone else.
"Disclosure. I just shorted all my Apple stock"
I'm just guessing, really... but you're betting that this forecasts a decline in price in the near term? Initially, there will be a dip, but upon consideration, people will realize that this bodes well for AAPL as *former executives* are shouldering the blame... leaving Apple to continue to sell product and please shareholders.
Selling short is, in light of this news, inappropriate.
Well, it looks like AAPL closed down $0.27 (a whopping decrease of 0.29%) on volume that's a little bit above the 3-month average, but nothing to write home about.
Almost 70% of AAPL shares are held by institutional investors; what Joe Weenie Shareholder thinks about the whole backdating options matter really does not matter.
Overall, it appears the market just shrugged and went about its usual business.
You don't settle in America, if your boss told you to do something and you got in trouble for it! You fight!! This is just and old man trying to deflect the story away from him!! Looks like vallwywag took the bait...
I do seem to recall Jobs had said something to the effect that he knew nothing about the issue. So if he really said that, it appears he flat out lied. But with the SEC not pushing it formally, it won't matter much. They report earnings tomorrow and all eyes will be on that issue and future guidance (when does the Jesus Phone ship?) not this one.
"Disclosure. I just sold all my Apple stock, before...."
spoken like a true rookie;) i wouldn't lose sleep over it.
zx
Steve Jobs knew nothing about a $140million decision that was in his favor???
Anyone that has EVER worked at apple knows this to be so far from the truth.
Steve Jobs knows about $140.00 decisions that do not affect him...why? because he is a douchebag and refuses to put anyone who he feels is a threat in any capapcity that could challenge his carefully crafted image.
That's a good one...he knew nothing......I bet Hitler claimed ne knew nothing too.
M
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