Hi John,
another 7.8 million for Rollins.........
Dell Approves $50 Million to Replace Execs' Frozen Options
By Edward F. Moltzen, CMP Channel
6:09 PM EDT Tue. Jul. 24, 2007 Dell said Tuesday that its directors have approved $50 million in make-good payments to 400 employees and ex-employees whose stock options have expired but can't be exercised because Dell has frozen employee stock transactions in the midst of an accounting investigation.
In a filing with the U.S. Securities and Exchange Commission, Dell named several of the executives who could benefit, including former CEO Kevin Rollins. Rollins stepped down under pressure as CEO earlier this year and was unable to cash in options in Dell stock.
Dell has set aside $7.8 million to pay Rollins in place of those options once it files delinquent financial reports with the SEC. Rollins had 400,000 options that expired on July 18.
Under the Dell plan, the company would make the payment to the employees up to 45 days after it filed its 10-K annual report with the SEC. Other executives named in the filing were Donald Carty, Dell's current chief financial officer and a board member who had options valued at $3.7 million that expired; Ro Parra, a Dell senior vice president who retired in April and had options valued at $2.3 million that expired; and Paul Bell, a Dell senior vice president who had more than $700,000 of expired options.
Dell said the company would take a compensation charge equal to the amount it pays out in cash.
The Round Rock, Texas-based company has been facing several investigations into its accounting and financial reporting since last year. The investigations cover certain fiscal periods back as far as 2002, and include probes by the SEC, the U.S. Attorney for the Southern District of New York, and the Audit Committee of Dell's Board of Directors.
Earlier this year, Dell said the Audit Committee found accounting errors, evidence of misconduct and deficiencies in the financial control environment. The probe continues, though, and Dell has provided no further details about what went wrong. |
