Google Inc. revealed late Wednesday that it may have illegally issued 23 million of its shares to hundreds of employees and consultants, according to wire reports citing a Securities and Exchange Commission filing.

The Web-search company disclosed the snafu in a prospectus, in which the company offered to buy back the affected shares and outstanding stock options for $25.9 million, including interest payments. Google said that it neglected to register 23.2 million shares of common stock and 5.6 million outstanding stock options with securities regulators, possibly violating laws in 18 states as well as the District of Columbia.

The common stock is owned by 1,105 current and former employees, as well as company consultants, the Associated Press reported. The options, carrying exercise prices ranging from 30 cents to $80 per share, are held by 301 people. Google, however, warned that some of the affected people may reject its buyback offer in favor of litigation.

Google’s IPO, which observers think will raise as much as $3.3 billion, is expected early as next Wednesday. Google said it planned to complete the IPO “as soon as practicable,” in its filing, but it was not immediately clear whether the unregistered, already issued shares would affect the timing, according to Reuters. What’s more, the buyback or “rescission” offer will expire sometime in September, the company noted without specifying a date.

Google also said the stockholders that reject or don’t respond to the rescission offer will have their shares and options automatically registered under federal securities law after the IPO is completed. The shares then would become tradable after the rescission offer expires next month.

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