SANTA CLARA, Calif., Sept. 27 /PRNewswire-FirstCall/ -- Coherent, Inc.
(Nasdaq: COHR) today announced that it expects to restate certain of its
previously issued financial statements to correct errors related to
accounting for stock-based compensation expense.
As previously announced, a Special Committee was established by
Coherent's Board of Directors to conduct an independent investigation
relating to the Company's historical stock option practices. The Company
requested the independent review following an internal review of its
historical stock option practices, which was a voluntary review initiated
in light of news of the option practices of numerous companies across
several industries. The Special Committee, comprised of three independent
members of Coherent's Board of Directors, retained independent outside
counsel and forensic accountants to assist in conducting the investigation.
Together with its independent counsel, the Special Committee conducted an
extensive review of historical stock option practices including all awards
made by the Company between January 1, 1995 and September 30, 2006, (the
"Relevant Period") that included the review of over one million documents
and over 30 interviews of current and former employees, directors and
advisors.
As a result of the investigation, the Special Committee, with the
assistance of independent legal and forensic accounting experts, determined
that incorrect measurement dates for a significant number of stock option
awards during the Relevant Period were used. Following such determination,
the Company's management worked to determine the impact of the incorrect
measurement dates. The Company's management has substantially completed its
assessment of the accounting impacts of the change in measurement dates for
stock options granted during the Relevant Period.
On September 26, 2007, the Company's Audit Committee, after
consultation with management, determined that additional charges for
stock-based compensation expense will be required and that those charges
will be material with respect to certain prior fiscal periods. The Company
expects the aggregate pre-tax amount of the additional non-cash
compensation through June 2006 to be in the range of $22 million to $28
million. The significant majority of these charges result from changes to
the measurement dates of stock options granted prior to the end of fiscal
year 2001, with over half of such non-cash compensation arising from stock
options granted in the fiscal year 2000. Accordingly, the Company's Audit
Committee concluded that Coherent's financial statements and any related
reports of its independent registered public accounting firm for the fiscal
years 1995 through 2005 and the financial statements for the fiscal
quarters ended July 1, 2006, April 1, 2006 and December 31, 2005 should no
longer be relied upon. Additionally, the Company has not yet determined the
tax consequences that may result from these matters or whether tax
consequences will give rise to monetary liabilities which may have to be
satisfied in any future period. (Please refer to the important disclosures
which follow under the heading "Forward-Looking Statements.")
Coherent intends to file its Form 10-K for the fiscal year ended
September 29, 2006 (the "2006 Form 10-K"), which will reflect the
restatement of the financial statements for all such periods presented, as
well as its quarterly reports on Form 10-Q for the periods ended December
31, 2006, March 30, 2007 and June 30, 2007, as soon as practicable. The
audited financial statements in the 2006 Form 10-K will contain restated
financial statements and explanatory information as required by the
Securities and Exchange Commission.
Any stock-based compensation charges incurred as a result of the
restatement will have the effect of decreasing reported income or
increasing reported loss from operations, and decreasing reported net
income or increasing reported net loss, and decreasing reported retained
earnings figures contained in Coherent's historical financial statements
for the periods mentioned above.
The Audit Committee has discussed the above matters with the Company's
independent registered public accounting firm.
Forward-Looking Statements
This press release contains forward-looking statements, as defined
under the Federal securities laws. These forward-looking statements include
the statements in this press release that relate to the amount and effect
of any stock-based compensation charges. These forward-looking statements
are not guarantees of future results and are subject to risks,
uncertainties and assumptions that could cause our actual results to differ
materially and adversely from those expressed in any forward-looking
statement. Factors that could cause actual results to differ materially
include risks and uncertainties, including but not limited to risks
associated with the determination and analysis of appropriate accounting
and tax treatment of new measurement dates and the resulting expense
calculations and other risks identified in the Company's SEC filings.
Actual results, events and performance may differ materially. Readers are
cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof. The Company undertakes no
obligation to update these forward-looking statements as a result of events
or circumstances after the date hereof or to reflect the occurrence of
unanticipated events. As noted above, the restatement may have an impact on
the amount and timing of previously awarded stock-based compensation and
other additional expenses to be recorded; accounting adjustments to the
Company's financial statements for the periods in question; the Company's
ability to file required reports with the SEC on a timely basis; the
Company's ability to meet the requirements of the Nasdaq Stock Market for
continued listing of its shares; potential claims and proceedings relating
to such matters, including shareholder litigation and action by the SEC
and/or other governmental agencies; and negative tax or other implications
for the Company resulting from any accounting adjustments or other factors.
Readers are encouraged to refer to the risk disclosures described in
the Company's Registration Statement on Form S-3 (as amended and filed with
the SEC on October 4, 2006) and the reports on Forms 10-K, 10-Q and 8-K, as
applicable and as filed from time-to-time by the Company.
Founded in 1966, Coherent, Inc. is a Standard & Poor's SmallCap 600
Company and a world leader in providing photonics based solutions to the
commercial and scientific research markets. Please direct any questions to
Leen Simonet, Chief Financial Officer at 408-764-4161. For more information
about Coherent, visit the Company's Web site at http://www.coherent.com/
for product and financial updates.
SOURCE Coherent, Inc.
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Related links:
http://www.coherent.com
CONTACT:
Leen Simonet of Coherent, Inc.,
+1-408-764-4161
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