Post-settlement, pre-merger housecleaning…
Last week, Mercury Interactive (MERQ) announced that it had proposed a $35 million settlement with the SEC over stock option issues and a formal investigation. By the end of the year, Mercury is expected to become a part of Hewlett Packard (HPQ) in a $4.5 billion deal.
So perhaps it should come as no surprise that Mercury decided to do a bit of housecleaning in the 10-K it filed yesterday by disclosing how much it has spent over the past three years to provide former CFO Doug Smith with a car: $250K. In the filing, it’s not clear whether the company meant an actual car service, of the Town Car variety, or whether it was an expense to provide Smith with a car. What is clear is that they spent $88K in fiscal 2005 on the service, $89K in fiscal 2004 and another $72K in fiscal 2003 on providing the perk, not to mention the obligatory tax gross-up. Though Mercury has provided limited disclosure on this perk for Smith in the past, it hasn’t been consistent. For example, in last year’s proxy, the company disclosed spending $80.7K in fiscal 2002, but nothing in 2003 for Smith’s car service. Then, for 2004, it says it spent $84.3K, which doesn’t match the number in the current filing.
So what do you think? Did Mercury spend the money on a Town Car or an S-Class? Footnoted.org reports. You decide.