SEC Deposition Suggests Steve Jobs Felt Underappreciated

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Feeling underappreciated was behind the large stock option grant given to Apple CEO Steve Jobs that resulted in a backdating scandal for the company, according to his testimony to the SEC. Forbes reported Wednesday that the magazine had obtained a transcript of Mr. Jobs's deposition through a Freedom of Information Act request with the SEC, and in that transcript, Mr. Jobs said he was looking for recognition, and that the money wasn't the issue.

Mr. Jobs's testimony was part of the SEC's investigation of then-General Counsel Nancy Heinen, whom the SEC accused of backdating the 10 million option grant to Mr. Jobs. Ms. Heinen eventually settled with the SEC, paid a fine, and was not required to admit any wrongdoing. Mr. Jobs himself was cleared of any wrongdoing.

At issue was the date of the grant. The SEC said that Ms. Heinen falsified minutes of a non-existent meeting of Apple's board of directors, and set the date of the grant back to a time that was more advantageous for Mr. Jobs.

The issues relating to SEC investigations have long been settled, and this week's story from Forbes was intended to offer a look behind the scenes at Steve Jobs through his own sworn testimony. In that testimony, Mr. Jobs said he didn't understand Generally Accepted Accounting Practices (GAAP) rules, and that he went to the board asking for a stock grant because he felt under-appreciated.

"It wasn't so much about the money," Mr. Jobs said in his deposition. "Everybody likes to be recognized by his peers. ... I felt that the board wasn't really doing the same with me. I just felt like there is nobody looking out for me here, you know. ... So I wanted them to do something, and so we talked about it. ... I thought I was doing a pretty good job."

The board agreed and gave him a 7.5 million share grant, but continued negotiation on when the grants would vest resulted in missed filing deadlines and other issues. That, in turn, led to someone at Apple -- the SEC said it was Ms. Heinen -- falsifying records to backdate them to a time that was more favorable to Mr. Jobs.

Mr. Jobs has always denied ordering any of this, and the SEC cleared him of any wrongdoing. Ms. Heinen has also denied doing anything wrong, and aside from agreeing to a US$2.2 million fine, was not required to admit any wrongdoing. Then-CFO Fred Anderson, who is now a managing director with Elevation Partners, which owns a stake in Forbes, also paid a fine of $3.3 million relating to this issue, but also was not required to admit wrongdoing.

Comments

Kirk

Boo hoo hoo.

algr

We love you Steve!

irieblue

Bryan, Forbes is a deeply captured news outlet. It was created by a consortium of hedge funds with a short selling agenda, nothing that comes out of Forbes can be considered real news. Stop linking to these miscreants please, otherwise you’ll remain part of the problem and not the solution.. Bloomberg has much more credible news… They would never publish crap like this..

Bosco (Brad Hutchings)

They probably made up the transcript, right irieblue? Let’s assume that what you say about Forbes is entirely true, that it’s an outfit founded by short-sellers. What’s wrong with that? If you’re not looking at the short side, you’re ignoring 1/2 the opportunity to profit. If you can’t appreciate and explain the value of short sellers in the marketplace, you have no business participating in it.

And now to Steve Jobs. You just know the board meeting went down like this:

Steve: I don’t feel appreciated.
Al Gore: What if we paid you $2 per year instead of $1? That would double your salary.
Steve: Why am I not surprised at your math? I invent Keynote for my Stevenotes and you get all the credit for it with that scare film of yours.
b]Bill Campbell: You’ve got a jet. Hell, I don’t even get to fly first class except during tax season.
Steve: It’s not about the money. I want to feel appreciated. I want to know that you guys would kill for me. Steal for me. Or at least backdate my options, where there is some theoretical risk that you might get in trouble if anyone ever puts together what the scheme means. As doubtful as that is, I’d feel like you guys tried.
Al Gore: Well, it wouldn’t be as bad for me as if my son were busted for DUI in a Prius. I’m OK with it if everyone else is.

algr

you get all the credit for it with that scare film of yours.

Do you know how often people refer to Al Gore’s “Powerpoint” presentations?

irieblue

Bosco I have a problem with Abusive Naked short selling and failure to deliver shares past T+3 days. This is a completely different issue to legitimate short selling.  I will concede that I err’d I meant Barrons is a deeply captured news org, not Forbes. But that said there are alot of reporters who it turns out are deeply captured by certain Hedge fund institutions… Let me give some names here…  Cheryl Strauss editor at Barrons and the wife of David Einhorn.. Bethany Mclean now at vanity fair and the reporter who broke the Enron story, and a couple other similar stories, it turns out she was given those stories by some short selling hedge fund managers (who are now under investigation by the SEC). Also the biggest culprit is Alan Greenspan who was retained by John Paulson’s Hedge Fund ,  huh you ask? Greenspan is not a reporter… No but he goes on TV and talks to reporters and says things like US banks might need to be temporarily nationalised…  John Paulson (no relation to Hank Paulson) is the poster child for profiting of Subprime and failure of banks.. 

As pertains to AAPL go and look at the Reg SHO data on the SEC’s Web site and you will see that AAPL had many fails back in September and October last year where millions of shares took more than T+3 days to be delivered, right around the time of all the negative press about Steve Jobs health..

Doesn’t it strike you as funny about this transcript and news article making the rounds the day after earnings when AAPL has gapped up .. Don’t you go hmm why now? Couldn’t they have piled on ages ago?

irieblue

If you want to analyze the SEC data yourself download the data from http://www.sec.gov/foia/docs/failsdata-archive.htm

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