The Mac Observer

Apple Overhauls Corporate Governance, Adds Two Independent Director Positions

March 19th, 2003 at 2:00 PM - Apple Stock Watch by Bryan Chaffin

On the heals of announcing the appointment of Al Gore to its board of directors, Apple announced today an overhaul of its corporate governance rules. The company also officially announced that two new director positions had been added to the board, including the one already occupied by former vice president Al Gore. The press release says that Apple is looking for another independent director to fill the second spot, as well.

More importantly, Apple has taken steps to overhaul employee stock options. Apple is going to allow employees, including Steve Jobs, to exchange a total of 32 million options -- the vast majority, or 27.5 million of those options, being Mr. Jobsi set at a price above todayis trading value, for fewer options at a lower price. The net effect will be to remove millions of options from circulation, or in finance-speak, to achieve a "reduction in issued stock option overhang." Appleis press release:

Apple today announced that its Board of Directors yesterday approved several measures to enhance corporate governance, including adding two additional independent directors to its board, increasing the use of independent committees on the board and reducing issued stock option overhang from 23 percent to 16 percent.

As part of its plan to add two additional independent directors, Apple announced the addition of former United States Vice President Albert Gore Jr. to its board. Mr. Gore was elected at Appleis board meeting yesterday. Apple has commenced a formal search for a second independent director, which the Company hopes to add before the end of the summer. With the addition of the second independent director, five out of seven Apple directors will be independent under SEC and NASDAQ rules.

Appleis Board of Directors has expanded the role of its independent Nominating Committee to include corporate governance as the new Nominating and Corporate Governance Committee, and has expanded the role of its Audit Committee in accordance with the Sarbanes-Oxley Act and proposed SEC and NASDAQ regulations. These two committees are chaired by independent directors and staffed by a majority of independent directors.

Appleis Board of Directors also approved two measures to reduce the Companyis issued stock options as a percentage of total options and shares outstanding from the current level of 23 percent to 16 percent. The first measure is a voluntary employee stock option exchange program which allows the Companyis employees who are not executive officers and hold options with exercise prices at or above $25.00 to exchange them for a lesser number of new stock options priced at fair market value six months and one day after their existing options are cancelled. The second measure is for Apple CEO Steve Jobs to voluntarily exchange his 27.5 million stock options for a new grant of 5 million restricted shares that will vest on the third anniversary of the grant. Together these measures are expected to return a net total of over 32 million options back to the Company, which represent almost 7 percent of the total options and shares currently outstanding.

In addition, the Board approved cancelling the Companyis non-shareholder approved option plan upon the completion of the employee exchange program and shareholder approval to amend the remaining shareholder-approved executive officer stock plan so it can be used to grant options to all employees.

You can find more information on Appleis corporate governance at the companyis Investor Relations Web site.

  • Related Entries
  • Email This
  • Tweet This
  • Bryan Chaffin on Twitter
Login. Need an account? Register here.



Auto-login on future visits

Show my name in the online users list

Forgot your password?


Commenting is not available in this section entry.
 

Recent Headlines - Updated November 22nd

Fri, 7:07 PM
Games - Soccer Sim Championship Manager 2010 Released for Mac
6:47 PM
Games - EA Publishes Original Monopoly for iPhone
6:15 PM
News - Original Apple I on Ebay for $50K, w/Letter from Steve Jobs
6:11 PM
Games - New iPhone Games: Secret of the Lost Cavern Ep 1, New DJ Nights, More
5:47 PM
Games - Star Trek D-A-C Game Headed to the Mac Next Month
4:57 PM
Product News - TidBITS Releases “Take Control of Syncing Data in Snow Leopard”
4:26 PM
John Martellaro's Blog - Particle Debris (week ending 11/20) Stationery Pads Go Poof
2:59 PM
Free on iTunes - Musée du Louvre, Art Lite, SketchBook Mobile X and More.
1:50 PM
Deal Brothers - Acer P215H bmid 21.5” Widescreen LCD Monitor:  $139.99
11:24 AM
TMO Appearances - Jeff Gamet Shares More Holiday Gift Ideas on MacJury
10:43 AM
Product News - Cocktail 4.5 for Leopard Adds QuickLook Cache Clearing
10:06 AM
News - Hack Enables Mac OS X 10.6.2 on Netbooks
 

The Mac Observer Reader Specials

  • Buy Stuff, Support TMO!
  • __________
  • Macworld Expo 2010 Hotel Deal
  • TMO on Twitter!

Apple Stock Quote

  • AAPL: $199.92. Change: -0.59.
  • (Prices delayed up to 20 minutes.)
  • Discuss in our Apple Finance Board

Hot Topics

TMO Express

Join the TMO Express Daily Newsletter to get the latest Mac headlines in your e-mail every weekday. Find out more!

Top Deals From DealBrothers.com

Recent Features