RIM execs to pay £50m in backdating settlement
Published: 09 Feb 2009 14:34 GMT
The co-chief executives of Research in Motion and two other executives will pay more than £50.2m to settle a stock options-backdating case, under an agreement approved on Thursday by Canada's securities commission.
Co-chief executives Jim Balsillie and Mike Lazaridis, chief financial officer Dennis Kavelman and finance director Angelo Loberto have agreed to the C$92m payment, BlackBerry maker RIM said on Wednesday, in a statement announcing the settlement. Of that total, C$38.3m (£21m) will go to RIM to offset the benefit the executives received from incorrectly priced stock options, which were granted to all employees from 1996 to 2006.
The executives will also pay C$44.8m to defray costs incurred by the company in the investigation and will give C$9.1m to the Ontario Securities Commission as an administrative penalty and to cover its costs, according to the settlement.
RIM and the executives have also made offers to the US Securities and Exchange Commission to resolve that agency's investigation into option-granting practices at the handset maker, RIM said in a statement. Those settlement offers are subject to SEC approval. If they are approved, the BlackBerry maker does not expect the settlements will have a material adverse effect on the company's business, it said.
"RIM is pleased that the parties have resolved matters with the OSC and looks forward to resolving matters with the SEC," John Richardson, RIM's lead director, said in the statement.
According to the settlement agreement, about 1,400 of RIM's 3,200 stock option grants were backdated (that is, assigned an issue date prior to the actual grant date) or re-priced (dated later than the actual grant). Both of these are done to increase the value of the option.
RIM employees made about £36m as a result of the incorrect options-dating practices, but only half of that has been repaid, the settlement agreement said.
Credit: RIM execs to pay $74 million for options-backdating from CNET News
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