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http://www.nytimes.com/2006/08/11/business/11brocade.html?ex=1312948800&en=0930faa19640faec&ei=5088&partner=rssnyt&emc=rssSAN FRANCISCO, Aug. 10 (Bloomberg News) — Officers and directors of Brocade Communications Systems Inc., the software maker, agreed to strengthen corporate governance and pay $525,000 along with former executives to settle shareholder lawsuits over stock-option backdating.
The settlement resolves some claims that Brocade, based in San Jose, Calif., misled investors before restating earnings twice last year because it did not properly account for backdated stock option grants to employees.
The company has been swept up in an investigation into illegal backdating and manipulation of employee stock option grants. On Thursday, its former chief executive, Gregory L. Reyes, and the former vice president for human resources, Stephanie Jensen, were indicted by a grand jury on charges of conspiracy and securities fraud.
They are accused of backdating job offer letters so employees could be given stock option grants that were priced when shares were lower.
The two were originally charged in a criminal complaint by prosecutors on July 20. The grand jury indictment includes additional charges of conspiracy, falsifying regulatory filings and making false statements to auditors. An indictment allows the government to proceed to trial.
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