When the matter makes court, Apple’s former general counsel pays .2 million to settle charges that she backdated stock options for Jobs, herself and others — and created fake paperwork to hide this fact.
Stock options frequently tie into executives’ compensation.
We would like to acknowledge the excellent research assistance from Ian Gow and Charles Wang in preparing this discussion.
We also appreciate the comments of Alan Jagolinzer, Thomas Lys, and Hayagreeva Rao.
Apple is far from the only company to take advantage of this type of arrangement. Unlike an entrepreneur like Bill Gates, Jobs didn’t seem cash-hungry.(who broke the backdating story), Jobs was awarded 7.5 million shares approved at Apple’s August 29, 2001, board meeting. However, because Jobs continued to argue over the point at which they would vest, Apple missed the deadlines it needed to file the right information with the Securities and Exchange Commssion and its auditors.It took until December that year until terms were finally agreed upon, at which point Apple’s stock price was .01.Backdating was then carried out to give Jobs a lower share price which, on paper, made him million richer.News of the Apple backdating scandal didn’t find its way into the public consciousness until late 2006.