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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Lizzie Tudor who wrote (68649)	9/15/2007 7:33:21 PM
From: HerbVic	Read Replies (1) \| Respond to of 213177

Lizzie, You already know that it is not the backdating of options that is drawing legal prosecution. It is the failing to record necessary compensation expenses in financial statements. So, how can you agree "with the comment at the end of [the] piece that the bar has already been set by the Reyes case where this practice of backdating was deemed stealing...?" IMHO, Greg Reyes was thrown to the wolves, just as Fred D. Anderson and Nancy R. Heinen were, to protect the company. If you want to go on a rant about this story, you might want to concentrate on the fact that placing the adjective "former" in front of your title can land you in jail. byteandswitch.com -=-=-=-=- From Wikipedia: With respect to the more serious cases of backdating, it is likely that most of the criminal actions that the government intends to bring will be brought in 2007. There is a five-year statute of limitations for securities fraud, and under the Sarbanes-Oxley Act of 2002, option grants to senior management must be reported within two days of the grant date. This all but eliminated the opportunity for senior management to engage any meaningful options backdating. Therefore, any criminal prosecution is likely to be based on option grants made before Sarbanes-Oxley took effect, and the deadline facing the government for bringing those prosecutions is approaching. en.wikipedia.org

To: Lizzie Tudor who wrote (68649)	9/17/2007 2:02:53 PM
From: Cogito	Read Replies (1) \| Respond to of 213177

Lizzie - The dilution to shareholder value in issuing options at all is one issue. Backdating only results in a (usually) small difference between the price the grantee pays the company to exercise the options. It does not make a difference in terms of dilution, because the same number of shares is granted in any case. If I am granted options for 10,000 shares at a price of $100, even though the share price was $1 more on the date when the shares were granted, then the company receives a whopping $10,000 less when I exercise my options. Even if the difference is $10, that's still only $100,000 less going back to the company. With Apple, we're talking about that happening only a few times. It wasn't a standard practice for all options. So even though Apple's stock is more volatile than most, leading to greater differences between grant date and backdated prices, it just really doesn't add up to that much money. And we are talking about a stock that has gone up tenfold in the past five years, which makes the claim of dilution of shareholder value seem ludicrous to me. - Allen