SAN JOSE, Calif. -- There's more trouble at Broadcom Corp. amid its ongoing stock-option probe.
Broadcom (Irvine, Calif.) said that its chairman and chief technical officer, Henry Samueli, and senior vice president and general counsel, David Dull, have each taken leaves of absence as executive'officers.
In addition, Samueli has also resigned from the board and as chairman. The board has named John Major, an independent director of the company since January 2003, to serve as non-executive chairman.
The actions are pending resolution of a civil complaint filed'against them by the U.S. Securities and Exchange Commission'(SEC) on Wednesday (May 14) relating to its previously-disclosed' investigation of Broadcom's historical stock option granting practices.'
While Samueli and Dull are on leaves of absences from their elected officer posts, they will continue to serve as non-officer employees of the company, reporting to President and Chief Executive Officer, Scott A. McGregor.
They will not be involved in matters dealing with corporate governance, the company's financial reporting or public disclosures, and will no longer have the power to bind the company under agreements. Samueli will not be standing for re-election to the board at the company's 2008 annual meeting.
"While we will not be commenting on the allegations made in the SEC's complaint against Henry and David, or against other former Broadcom employees, it is important to note that the government's charges pertain to events that occurred half a decade to nearly a decade ago," Major said in a statement.
"In mid-2003 the company significantly strengthened its equity award practices, putting into place rigorous processes for equity awards. We believe that the company's current practices are among the best anywhere,'' he said.
''In early 2007, our Audit Committee, comprised entirely of independent directors, engaged independent counsel to determine that Broadcom's current equity granting processes are appropriate and sound and have been consistently adhered to since June 2003," he said.
Last month, Broadcom entered into a settlement with the SEC relating to the SEC's investigation of Broadcom's historical stock option granting practices.
Without admitting or denying the SEC's allegations, Broadcom agreed to pay a civil penalty of $12 million. The U.S. District Court for the Central District of California approved the settlement at the end of April 2008, thus concluding the SEC's investigation of this matter with respect to Broadcom.
