TORONTO (Reuters) - Canadian securities regulators have reached a potential settlement with the top two executives of Research In Motion Ltd following an investigation into a stock option accounting controversy dating back to 1996.
The Ontario Securities Commission said in a statement on Tuesday that it would hold a hearing Feb 5 in Toronto on whether to approve a settlement its staff reached with the company and top executives including co-chief executives Jim Balsillie and Mike Lazaridis.
RIM, maker of the popular BlackBerry wireless e-mail device, confirmed in a statement that the regulator had reached a settlement with the company and “certain of its officers and directors.”
It said the terms of the settlement are confidential and may only be disclosed if and when the settlement is approved by a panel of OSC commissioners at the hearing.
The regulator issued a statement of allegations in which it alleged Balsillie, Lazaridis and other RIM executives “engaged in the grant of options, in which option backdating or option repricing occurred.” A call and e-mail to the company requesting comment on the specific allegations were not immediately returned.
RIM said in its statement that the settlement relates to “the previously disclosed investigation of RIM’s historical stock option granting practices that followed the management-initiated, voluntary review commenced in 2006.”
In March 2007, RIM announced an internal review had found no intentional misconduct by executives, directors or other employees responsible for administering options grants.
However, Balsillie stepped down as chairman at the time as the company revealed an earnings restatement relating to mistakes in how it granted the options.
Canada’s Globe and Mail newspaper, citing unidentified sources, reported last month that the country’s regulators had been seeking a record penalty as high as C$100 million ($81 million) from the co-CEOs related to the options issue.
Reporting by Jeffrey Hodgson