Affymetrix Announces Update Regarding Stock Option Grants
August 09 2006 - 4:00PM
Business Wire
Affymetrix, Inc. (Nasdaq:AFFX) announced that as a result of its
previously announced internal review into historical stock option
granting practices it will restate its financial statements for
certain options granted between 1997 and 1999. The review
identified certain documentation lapses but did not find any
pattern or practice of inappropriately identifying grant dates with
hindsight in order to provide "discounted" or "in-the-money"
grants. The restatement is currently expected to reflect additional
non-cash compensation expense from 1997 to 2003, the vesting period
of the options. The restatement is also expected to reflect a tax
benefit arising from this stock compensation expense. This tax
benefit will be recorded in 2005, the year in which the company
reduced its valuation allowance for certain deferred tax assets.
The result will be to increase the company's previously reported
net losses from 1997 to 2002, reduce previously reported net income
for 2003, and increase its previously reported net income in 2005.
Affymetrix expects to file restated financial statements for the
affected periods with the Securities and Exchange Commission during
the current quarter. The company has filed a Form 12b-25 with the
SEC indicating that its Form 10-Q for the quarter ended June 30,
2006 will not be filed on schedule. As a result of the restatement,
the financial statements contained in the Company's Form 10-K for
the year ended December 31, 2005 and its Form 10-Q for the quarter
ended March 31, 2006 should no longer be relied upon. About
Affymetrix Affymetrix scientists invented the world's first
high-density microarray in 1989 and began selling the first
commercial microarray in 1994. Since then, Affymetrix GeneChip(R)
technology has become the industry standard in molecular biology
research. Affymetrix technology is used by the world's top
pharmaceutical, diagnostic and biotechnology companies as well as
leading academic, government and not-for-profit research
institutes. More than 1,400 systems have been installed around the
world and nearly 4,000 peer-reviewed papers have been published
using the technology. Affymetrix' patented photolithographic
manufacturing process provides the most information capacity
available today on an array, enabling researchers to use a
whole-genome approach to analyzing the relationship between
genetics and health. Affymetrix is headquartered in Santa Clara,
Calif., with manufacturing facilities in Sacramento, Calif., and
Bedford, Mass. The Company maintains important sales and marketing
operations in Europe and Asia and has about 1,100 employees
worldwide. For more information about Affymetrix, please visit the
Company's website at www.affymetrix.com. All statements in this
press release that are not historical are "forward-looking
statements" under the federal securities laws. Such statements are
subject to risks and uncertainties that could cause actual results
to differ materially, including but not limited to the risk that
further review of the Company's financial reporting for prior
periods will require further restatement, and the other risk
factors discussed in Affymetrix' Form 10-K for the year ended
December 31, 2005 and other SEC reports, including its Form 10-Q
reports for subsequent periods. Affymetrix expressly disclaims any
obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to
reflect any change in Affymetrix' expectations or any change in
events, conditions, or circumstances on which any such statements
are based.
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