A special committee of the board, which is in the early stages of reviewing stock option grants made in 2000 and 2001, has decided to expand the scope of its inquiries. It said it is possible that it will need to restate its financial statements record additional charges for stock-based compensation expense.
The problem Embarcadero now faces is that a special meeting of stockholders is scheduled for November 30 to vote on the proposed merger. This does not leave enough time for the committee to complete its work, so the company believes the meeting will have to be adjourned to a later date without a vote.
Embarcadero said it has advised the private equity buyers of the delay and said it is discussions with them about any impact on the proposed merger. It is also to appealing to Nasdaq against delisting its stock because of a delay in its regulatory filings.
