Activists Take Aim at Apple

The proposal to set guidelines for granting options is particularly thorny in light of Apple's simmering scandal. An internal review found that discrepancies between reported dates and actual dates on options granted between 1997 and 2001 understated past expenses by $105 million.

Apple's former chief legal counsel is under investigation. Its former chief financial officer settled civil charges with the SEC and has implicated CEO Steve Jobs as complicit in the financial misrepresentation of expenses.

Apple rejects the need for option-granting guidelines because in 2003 it began giving senior executives grants for restricted stock rather than common stock. The company says restricted stock grants can't be manipulated because they don't have a strike price like options.

Amalgamated counters that the protections are necessary because the company may in the future choose to begin granting options for common stock again. "Compensation fads come and go, and restricted stock is the flavor of the day," said Con Hitchcock, Amalgamated's outside counsel.

Amalgamated withdrew similar proposals from the ballots of six other companies after their management agreed to adopt policies to prevent future backdating occurrences. Talks with Apple's management, said Hitchcock, "did not make as much progress."