Stock Options: The Backdating Issue

[Excerpt] Employee stock options are contracts giving employees the right to buy the company’s common stock at a specified exercise price, at a specified time or during a specified period, and after a specified vesting period. The value of the option when granted lies in the prospect that the market price of the company’s stock will increase by the time the option is exercised (used to purchase stock). At the grant date for the options, rather than selecting an exercise price based on the current market price for the stock, officials at some companies have selected a prior date with a lower market price; that is, they backdated stock options to an earlier grant date. If this backdating occurred without public disclosure, the recipient of the stock options received increased compensation in violation of Securities and Exchange Commission (SEC) regulations, generally accepted accounting rules, and tax laws. Some backdating is said to involve “sloppiness,” not fraud. The backdating of stock options has imposed costs on shareholders, employees, bondholders, and taxpayers. A corporate official who has profited from undisclosed backdating of stock options may not be responsible or even knowledgeable of the backdating. “Nonqualified” stock options, which have no special tax criteria to meet, are the focus of the backdating controversy primarily because they can be granted in unlimited amounts. The magnitude of stock option grants grew dramatically in the 1990s, subsequent to passage of the Omnibus Budget Reconciliation Act of 1993, a stock market boom, and revised accounting rules. Recent corporate disclosure changes have reduced the opportunities and rewards for backdating stock options. Empirical studies about backdating have been done by academics and investigative journalists. Four recent regulatory actions may have reduced the backdating of stock options, but problems persist. On December 16, 2004, the Financial Accounting Standards Board issued new rules requiring companies to subtract the expense of options from their earnings. After August 29, 2002, the Sarbanes-Oxley Act required that companies notify the SEC within two business days after granting stock options. In 2003, the SEC required increased disclosure of stock option plans. The SEC issued enhanced option grant disclosure rules effective December 15, 2006. Policy options to further reduce backdating and other timing manipulation include changes in SEC regulations and a change in the tax law. The SEC, various state prosecutorial, and Department of Justice (DOJ) probes into backdating abuses are ongoing. In addition, many firms have mounted their own internal probes into possible abuses. By November 2007, the SEC’s investigation caseload had fallen from a peak of 160 to about 80, and the SEC had brought civil enforcement actions against seven companies and 26 former executives associated with 15 firms. And according to reports from the DOJ, there were at least 10 criminal filings against defendants for backdating. As of January 2, 2008, the only CEO to be convicted of charges related to backdating was Greg Reyes, former Brocade CEO. This report will be updated as issues develop or new legislation is introduced

Fluoride In Drinking Water: A Study Of The Cause And Effects In The Hai District Of Northern Tanzania

The Hai District in Northern Tanzania is one of the many areas along the East African Rift Valley where the groundwater contains high levels of fluoride. This study by sampling fluoride levels from water sources in the 52 villages of the Hai District identified two communities where the fluoride levels were high and presented a risk to human health

Fleeting Amyloid-like Forms of Rim4 Ensure Meiotic Fidelity

Berchowitz et al. establish that transient amyloid-like forms of Rim4, a yeast RNA-binding protein with a predicted prion domain, translationally repress cyclin CLB3 in meiosis I, thereby ensuring homologous chromosome segregation. These findings suggest that prion domains might enable formation of tightly regulated amyloid-like effectors in diverse functional settings

Fluoride in groundwater : investigating the cause, scale, effect and treatment of fluoride in drinking water in Northern Tanzania

High fluoride in drinking water sources is a problem throughout the East African Rift Valley and can lead to dental fluorosis and skeletal fluorosis in exposed local populations. One such area is the Hai District of Northern Tanzania. The study began by mapping the concentrations of fluoride in drinking water across the Hai district. Measured at 152 locations, fluoride concentrations varied from <0.1 mg/L to 33.2 mg/L, with a mean value of 1.6 mg/L. 12.5% of samples had fluoride above the World Health Organization recommended water quality standard (1.5 mg/L). Along with mapping the levels of fluoride, rock samples were also taken in an attempt to identify the source of the fluoride. Rock samples taken from areas with high levels of fluoride in the drinking water contained fluorite that shows textural evidence of dissolution. Other geological evidence from studies in a neighbouring district suggest that a geological system only present in part of the Hai district is responsible for the high levels of fluoride in the drinking water. Two villages where fluoride was identified as a problem from the mapping were investigated. The prevalence of dental fluorosis and deformities due to skeletal fluorosis were assessed in children attending school in the two villages. Over 25% of children in each village had skeletal deformities, though one village had much higher levels of fluoride in the drinking water, a mean of 23.5 mg/l compared to 5.4 mg/l) in the other village. Over 99% of children in both villages had dental fluorosis. Deformities relating to skeletal fluorosis are common, but the reasons for individual susceptibility remain unclear and may include low calcium diets, ingestion of magadi (local salt) with high fluoride, or genetic factors. iv The study concluded by considering possible treatment options and installed a bone char treatment plant in the village of Tindigani. Throughout the study, the communities were educated about the issue of fluoride in the drinking water. The village of Tindigani responded by mobilizing to provide piped water for themselves, removing the need for the bone char treatment plant.EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Prion-like domains as epigenetic regulators, scaffolds for subcellular organization, and drivers of neurodegenerative disease

Key challenges faced by all cells include how to spatiotemporally organize complex biochemistry and how to respond to environmental fluctuations. The budding yeast Saccharomyces cerevisiae harnesses alternative protein folding mediated by yeast prion domains (PrDs) for rapid evolution of new traits in response to environmental stress. Increasingly, it is appreciated that low complexity domains similar in amino acid composition to yeast PrDs (prion-like domains; PrLDs) found in metazoa have a prominent role in subcellular cytoplasmic organization, especially in relation to RNA homeostasis. In this review, we highlight recent advances in our understanding of the role of prions in enabling rapid adaptation to environmental stress in yeast. We also present the complete list of human proteins with PrLDs and discuss the prevalence of the PrLD in nucleic-acid binding proteins that are often connected to neurodegenerative disease, including: ataxin 1, ataxin 2, FUS, TDP-43, TAF15, EWSR1, hnRNPA1, and hnRNPA2. Recent paradigm-shifting advances establish that PrLDs undergo phase transitions to liquid states, which contribute to the structure and biophysics of diverse membraneless organelles. This structural functionality of PrLDs, however, simultaneously increases their propensity for deleterious protein-misfolding events that drive neurodegenerative disease. We suggest that even these PrLD-misfolding events are not irreversible and can be mitigated by natural or engineered protein disaggregases, which could have important therapeutic applications. This article is part of a Special Issue entitled SI:RNA Metabolism in Disease

Structural basis for substrate gripping and translocation by the ClpB AAA+ disaggregase.

Bacterial ClpB and yeast Hsp104 are homologous Hsp100 protein disaggregases that serve critical functions in proteostasis by solubilizing protein aggregates. Two AAA+ nucleotide binding domains (NBDs) power polypeptide translocation through a central channel comprised of a hexameric spiral of protomers that contact substrate via conserved pore-loop interactions. Here we report cryo-EM structures of a hyperactive ClpB variant bound to the model substrate, casein in the presence of slowly hydrolysable ATPγS, which reveal the translocation mechanism. Distinct substrate-gripping interactions are identified for NBD1 and NBD2 pore loops. A trimer of N-terminal domains define a channel entrance that binds the polypeptide substrate adjacent to the topmost NBD1 contact. NBD conformations at the seam interface reveal how ATP hydrolysis-driven substrate disengagement and re-binding are precisely tuned to drive a directional, stepwise translocation cycle

Stress granules as crucibles of ALS pathogenesis

Amyotrophic lateral sclerosis (ALS) is a fatal human neurodegenerative disease affecting primarily motor neurons. Two RNA-binding proteins, TDP-43 and FUS, aggregate in the degenerating motor neurons of ALS patients, and mutations in the genes encoding these proteins cause some forms of ALS. TDP-43 and FUS and several related RNA-binding proteins harbor aggregation-promoting prion-like domains that allow them to rapidly self-associate. This property is critical for the formation and dynamics of cellular ribonucleoprotein granules, the crucibles of RNA metabolism and homeostasis. Recent work connecting TDP-43 and FUS to stress granules has suggested how this cellular pathway, which involves protein aggregation as part of its normal function, might be coopted during disease pathogenesis