A Securities and Exchange Commission probe is focusing on whether Take-Two improperly backdated stock options.

Backdating, which effectively changes the purchase price of stock options, is a legal way to increase the value of an employee's stock. However companies are required to fully disclose and account for any backdated options.

The practice has recently caused dozens of prominent companies to run afoul of securities regulators, including Apple Computer, Pixar, KB Homes, Barnes & Noble, and others. Backdating allows executives to inflate the value of their options by changing the date when the exercise price of the options was set. Choosing a past date when the market price was particularly low can make options significantly more profitable when they are exercised.

Companies that backdate stock options can be required to resubmit financial statements, and may face civil or criminal sanctions. In addition, improper backdating can trigger serious tax consequences and shareholder litigation.

While Take Two has acknowledged that an SEC investigation is underway, the company also indicated this week that it has regained compliance with NASDAQ, allowing the game publisher to remain listed on the NASDAQ Global Select Market.

The interim management team at Take-Two, appointed following the abrupt departure of the New York company's CEO and other key executives in recent weeks, has also unveiled a "100-day plan" for revitalizing and restructuring the game publisher's business. At the same time, it will have to contend with separate investigations being conducted by the SEC, the Manhattan district attorney and the Internal Revenue Service.

Investors ousted Take Two's executive team over concerns about alleged mismanagement of company assets. The most recent departure was that of Chief Financial Officer Karl Winters, who resigned on April 9.  Despite efforts to diversify its offerings, Take Two's revenues continue to rely heavily on its Grand Theft Auto franchise, which has drawn frequent criticism for its graphic violence and sexual content.