Lam Research Defends Options Practices

Staff Reporter -- Electronic News, 5/26/2006

Although it hasn't even been identified as a company that is even suspected of any wrongdoing, Lam Research has issued a statement regarding its stock options practices in response to inquiries from shareholders.

“Lam’s policy and practice have been to grant options to the CEO after the approval of the independent board members at regularly scheduled board meetings,” the company said in a short statement.

“Grants to the other named executives are made after the approval of the compensation committee at its regularly scheduled meetings.”

Lam Research is a Fremont, Calif.-based supplier of wafer fabrication equipment and services.

Several companies have been identified by the Wall Street Journal and various analyst firms as having options granting histories that have provided extraordinary returns to executives, calling into question whether the companies have engaged in backdating of options. Many companies are engaging in internal reviews of their options granting practices.  And some are under investigation by the U.S. Securities and Exchange Commission and the U.S. Attorney’s office.