For anxious

Tyco

(TYC)

shareholders, the waiting may not be the hardest part.

The industrial conglomerate told investors Monday they'd have to sit still for another day before they learn the details of a probe of the company. The inquiry, led by high-profile lawyer David Boies, is expected to shed further light on the actions of ex-CEO Dennis Kozlowski. Kozlowski was indicted last week, along with two other former high-ranking Tyco execs, on charges they looted the company of millions of dollars.

Tyco already has indicated that it showered dozens of lower-level employees with millions of dollars in loans that were forgiven at the behest of Kozlowski. The market had been bracing for full details on the rampant lending and other matters. But Tyco delayed the much-anticipated 8-K filing until Tuesday, citing Monday's Yom Kippur holiday.

Just what the filing says may prove vitally important to Tyco stock, which plunged early this year amid a series of corporate governance and accounting scandals that culminated in June with Kozlowski's departure. Since then, new management has embarked on a series of moves aimed at regaining investor confidence and projecting the image of a cleaned house, pushing the stock modestly higher. But some bears on Tyco think damaging new disclosures could reverse the stock's gains.

Loan-Some Tyco

Christopher Bebel, a securities attorney at Shepherd Smith & Bebel, said Tyco's employee loan program could prove even more egregious than most.

"It's not unusual for companies to make loans to officers," Bebel said. "But the number of loans that has been made to a broad range of people in large dollar amounts makes Tyco somewhat unique."

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Tyco employees tapped the loan program to pay taxes on stock purchases and relocate to homes near the company's offices in Manhattan. Kozlowski, who was also indicted on sales tax-evasion charges in June, then waived his staff's responsibility to repay the loans.

"This arguably helps establish that it was top management that controlled the board, rather than vice versa," Bebel said. Questions about governance at the company have been prominent in new management's restructuring efforts, and over the last month there has been talk of massive change at Tyco's board.

Sinking?

Boies uncovered Tyco's lenient employee loan program during an internal investigation of the company. His findings are expected to be reflected in a special report Tyco will file with regulators before the market opens Tuesday.

Tyco shares slid 23 cents to $16.65 ahead of the news. The stock, which fetched $60 in December, bottomed out at $6.98 during the market meltdown in July.

The recent recovery has been fueled by Tyco's decision to hire Edward Breen, a respected former

Motorola

executive, to guide the company's recovery. But short-sellers say the rebound could be short-lived.

They predict that the recent torrent of scandalous discoveries will mount as the Tyco investigations move forward.

"If the ship is sinking, the ship is sinking," one short-seller said. "And it's not going to matter who the captain is."