Analog Devices Receives Subpoena
Staff Reporter -- EDN, May 24, 2006
Analog Devices Inc. has become the latest company to face inquires about its stock options practices.
The company today said that it has received a document subpoena from the U.S. Attorney for the Southern District of New York requesting records from 2000 to the present relating to its granting of stock options.
ADI believes the options at issue are the same option grants that have been the subject of investigation by the SEC. The company has reached a tentative settlement with the SEC regarding the government organization’s inquiry into its stock option granting practices. That settlement would conclude that, with respect to options granted to ADI employees -- including officers and directors -- on Nov. 10, 2000, the company should have made disclosures in its proxy filings to the effect that it priced these stock options prior to releasing favorable financial results, ADI said.
Further, with respect to options granted in 2001, ADI said the settlement would conclude that the appropriate grant date for options granted on July 18, 2001 should have been July 26, 2001, five trading days after the original date.
ADI said it is continuing to work with the SEC to finalize that settlement. In the meantime, the company has determined that no restatement of its historical financial results would be necessary due to the proposed settlement, because the effects of using revised measurement dates for the options in question are not material to any of ADI’s fiscal years.
ADI is far from alone in matters like these. This week Merrill Lynch identified six companies – KLA-Tencor, Marvell, Novellus, Linear Technology, Broadcom and Maxim Integrated Products – as top companies that need to take a second look at their stock practices. Vitesse Semiconductor and Brooks Automation also facing questions about their stock option practices.
ADI said it plans to cooperate fully with the office of the United States Attorney in connection with this subpoena.
