On March 18, 2008, Steve Jobs was deposed by the SEC during its enquiry of Apple’s hit choice backdating scandal. The accumulation was never prefabricated open until Forbes publicised it on Friday, after obtaining it finished a Freedom of Information Act request. (Full accumulation embedded below)

Jobs explains his rational for ground he asked the commission for mega grants of options for both himself and his crowning executives, but claims ignorance of the execution of how that was finished after the commission authorised the grants themselves. (It was the determination of commission transactions for a gathering that never occurred, not the backdating per se, that got Apple’s instance generalized direction metropolis Heinen into blistering liquid with the SEC?this accumulation was for a housing against her). There aren’t likewise whatever revelations on the jural face in the document.

But the writing provides the prototypal careful statement of the incident from Steve Jobs himself in his possess words. What comes finished in the accumulation is how Jobs sees himself and his’ unmerciful loyalty to those who impact for him. For instance, after commerce NeXt to Apple in 1997, his initial conceive for performing as a consultant was to intend “some of the NeXt grouping into whatever jobs where they could support Apple.” He himself was reluctant at prototypal to verify on the CEO persona at Apple because he didn’t poverty the grouping at his another company, Pixar, to “think I was abandoning them.”

Then when it came instance to move his “ultra key” executives with digit meg options each, digit of them were from NeXT. While he was attractive tending of his crowning lieutenants by disagreeable to “surprise and revel them with what a occupation at Apple could be”, he was “hurt” that Apple’s commission didn’t do the aforementioned for him. So he had to hit a lowercase speech with them most swapping his 20 meg then-underwater options for 7.5 meg newborn ones, which they did.

I’ve excerpted whatever of the juicier bits from the accumulation below. Some obloquy were redacted in the original, but I’ve reinserted them in brackets where it is manifest who Jobs is conversation most I’ve also bolded whatever parts for emphasis. (In the transcript, “A” is Jobs).

1. On reaching backwards to Apple and decent CEO in 1997:

Q: And I guess, meet to go backwards in instance then, I poverty to meet essay to wager a lowercase taste the transformation from having the denomination consultant to decent CEO. Could you meet exposit that transformation for me?

A: Well, when Apple bought NeXT, Apple was pretty messed up. It was pretty cushy to see. And I was disagreeable to support in my arm’s size role. I was disagreeable to support Apple by essay whatever of the NeXT grouping into whatever jobs where they could support Apple, and that’s pretty such every I was doing.

. . . Q: Okay, Did the commission in fact blast [Gil Amelio] the mass week?

A: Yes.

Q: And did you verify on the persona then as CEO?

Jobs: Well, no, I did not. I was rattling afraid that Pixar was a newborn open consort with shareholders, employees, and I change that – - to my noesis there had never been a CEO of digit open companies before. So I change if I took the job, the Pixar shareholders and employees would conceive I was abandoning them.

Q. Mm-hmm

Jobs. And I definite I meet – - that I couldn’t do that. So I took the denomination of interval CEO and united to become backwards for 90 chronicle to support enlist a full-time CEO.

Q. How did that achievement essay go?

A. I failed.

Q. And when you feature you failed, is it that you didn’t encounter anyone that you intellection would be fit to verify on the role?

A. Yes. Apple was not in beatific appearance and everybody knew it and the category of candidates that we were existence offered up by the headhunters were not rattling talented.

Q. Okay. In another words, not the variety of grouping who could invoke Apple around?

A. Yes.

Q. Okay. So after that 90 days, what happened next?

A. Well, it meet category of slid into the fact that I stayed. I kept the interval CEO denomination for quite whatever time, a variety of years.

2. On the origins of the 4.8 million-share mega present to Apple’s crowning executives:

A. Apple was in a unsafe status in that we’d, you know, had the internet eruct busting, and I intellection that Apple’s honcho aggroup and the unchangeability of Apple’s honcho aggroup was digit of its set strengths. And I was rattling afraid because archangel Dell, digit of our honcho competitors, had flown Fred Anderson, our CFO, downbound to Austin, I guess, him and his wife, I think, to essay to enlist him. And I was also afraid that [REDACTED] and [REDACTED] digit rattling brawny theoretical leaders, were also rattling vulnerable.

So I was rattling afraid that Apple could rattling undergo whatever bounteous losses on its honcho aggroup with the playing surround we were in and the competitors reaching after our people.

. . . Well, I talked with the commission nearly every gathering about, you know, key personnel, because I conceive that’s the key quality Apple has, is its talent

. . .

Q. All right. And who did you study to be these ultra key people?

A. [Timothy Cook] who at the instance I conceive was our Executive Vice President of Operations, maybe income and operations, actually. Fred Anderson, our CFO. [Jon Rubinstein] nous of hardware. [Avi Tevanian] nous of software.

Who am I forgetting? I conceive those were the quaternary key ones.

Two of those ultra key people, pianist and Tevanian, came from NeXT. Jobs helped them intend hired by Apple after the understanding of NeXT in the prototypal place, and then rewarded them downbound the distinction with options on digit meg shares apiece. Today, pianist is competing against Apple in his persona as the honcho chair of Palm, which is hardback by Silver Lake, where playwright is a partner. That’s gratitude for you.

3. On the discourse of whether Apple was disagreeable to garner a present fellow for the options to tap the convey to the executives, Jobs tries to modify how essential a persona that played in the process.

Q. And variety of in this support of options being, in part, a possession tool, is the intent to essay to intend a modify toll so that there is the possibleness to tap one’s profits on the options?

A. You know, this has become up before. I hit to verify you, for these options to be worth anything, the hit has to go up so such compared to a note or digit at the beginning . . . And so if these guys were feat to actualise the category of money they could attain elsewhere by staying at Apple, you know, they were feat to hit to attain tens of jillions of dollars. These guys are rattling grownup guys. Several of them, you know, could be CEOs of a whatever bounteous companies and a whatever medium-size companies.

So for them to actualise that category of a acquire here, it’s a aggregation more than a diminutive alteration in a accomplish price.

Nevertheless, with digit meg shares each, every $1 impact translated into a $1 meg acquire and a meg dollars is ease a meg dollars. But Jobs wasn’t meet gratifying his lieutenants, he was disagreeable to ready them. The “mega grants” were fashioned to be digit bounteous present instead of diminutive grants every year.

4. Jobs explains the rational behindhand his rectification strategy:

One of the things that I change was that kinda than gift them shares erst a year, as is ordinary in whatever companies, I would kinda provide them quaternary years’ worth of hit upfront. . . . the key abstract is if the hit goes up, which we ever wish it does, then the metallic handlock are dramatically increased, which is what I was hoping would happen.

And on the person of his possess present of 7.1 meg options at the time, Jobs says that he negotiated so hornlike for it because he change he wasn’t essay the acceptance he deserved:

Q. Could you meet verify me a lowercase taste most the impact of how this every came to be?

A. Well, it was a thickened situation, you know. It wasn’t so such most the money, because a rattling diminutive proportionality of my gain worth is from Apple.

Q. Okay.

A. But everybody likes to be constituted by their peers, and the closest that I’ve got, or whatever CEO has, is their Board of Directors. And as we’ve seen in the discussions of the instance hour, I spent a aggregation of instance disagreeable to verify tending of grouping at Apple and to, you know, assail and revel them with what a occupation at Apple could be – - could stingy to them and their families. And I change that the commission wasn’t rattling doing the aforementioned with me.

Q. Right.

A. So I was hurt, I presume would be the most faithful word, and, you know, the commission had presented me whatever options, but they were every underwater. They weren’t underwater needs because of our performance, but, you know, the eruct had separate in the dot-coms, and here I had been working, you know, I don’t know, quaternary years, fivesome eld of my chronicle and not sight my kinsfolk rattling such and stuff, and I meet change same there is nobody hunting discover for me here, you know.

Q. Right. Okay.

A. So I desired them to do something and so we talked most it.

Steve Jobs Deposition

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