Broadcom Corp. cofounders Henry Nicholas and Henry Samueli have agreed to pay the company more than $50 million as part of the chipmaker’s settlement of a shareholder lawsuit dealing with stock options backdating, according to a report.
The Daily Journal, a Los Angeles-based legal newspaper, reported that Samueli and Nicholas are set to turn over $26 million each in vested stock options as part of the settlement, which was struck in early 2010.
Nicholas was Irvine-based Broadcom’s formative chief executive. He left the company in 2003.
Samueli is Broadcom’s chief technical officer.
Broadcom agreed to pay some $160 million to settle the class action suit.
In exchange, claims against Broadcom and some former executive officers and directors would be dropped. The settlement allows them to deny any wrongdoing.
The suit was brought on behalf of investors who bought or acquired Broadcom’s shares from July 21, 2005, to July 13, 2006.
Former Broadcom finance chief Bill Ruehle and Samueli were named as defendants, along with Broadcom itself.
Ruehle, who left in 2006, earlier turned over $26 million in vested options, according to the Daily Journal, which relied on a Broadcom lawyer, court documents and unnamed sources for its story.
The payout by Samueli and Nicholas would presumably offset some of the costs Broadcom has had to take on for legal fees.
The Daily Journal pegged Broadcom’s legal costs at more than $100 million, citing a 2010 motion to dismiss the lawsuit by one of the company’s lawyers.
A spokesman for Broadcom declined to comment on the litigation or the Daily Journal story.
The company addressed the litigation in a recent Securities and Exchange Commission filing.
It said as of February, Nicholas, Ruehle and Samueli are in the process of finalizing a settlement.
In early 2007, Broadcom restated several years of financial results to reflect $2.2 billion in charges for misdated stock options.
The restatement bill was the largest of any company involved in a stock options issue.
