Research in motion stock option backdating
The option gives the employee the right to buy a certain number of shares in the company at a set price, called the strike price.The idea is that when the shares go up in value on the markets, the employee can buy shares from the company at the strike price and then sell them at the market price and make a profit.
Once dismissed as a yuppie toy for workaholic business-men, in the space of a decade, a generation cannot live without their Black Berrys.The shares closed almost 8% higher on the Toronto Stock Exchange on Feb. There could be any number of reasons why Balsillie wanted — or needed — to bail entirely on Black Berry. founder and CEO, famously unloaded all but one of his shares in the i Phone maker after he was dumped from the tech giant in 1985.After all, he and former co-CEO Mike Lazaridis have sold parcels of stock in the past, mostly to fund philanthropic causes. Balsillie became one of Canada’s most high-profile executives and a dominating presence within RIM since he arrived in 1992, after investing $250,000 of his money by re-mortgaging his house in what was then a fledgling tech play dependent on the innovation of Lazaridis and his boyhood friend Doug Fregin.The new President may now not be able to keep hold of his device, nicknamed the 'Crack Berry', since it looks like White House security advisers have given him a Sectera Edge, a high-tech PDA (personal digital assistant) developed for the National Security Agency.However, President Obama's obsession with his Black Berry is still a coup for Jim Balsillie, the co-chief executive and co-founder of Research In Motion (RIM), the Canadian company behind it.Along the way, the pair became billionaires and Balsillie became a national folk hero for his three ill-fated attempts to buy a National Hockey League franchise and relocate it to Canada.
However, as RIM’s fortunes struggled amid rising competition from the i Phone and Android devices, product delays and declining margins, Balsillie was criticized for being a distracted CEO for his failed hockey exploits.
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The hard-driving former co-chief executive and major shareholder got his way —again. Thus, not only did the directors fail to rein in Balsillie and corral his energy and intensity so that it didn’t become a self-destructing force to himself and the company, they let a figure who had been so pivotal to the brand sever all ties without restriction, sending mixed messages to shareholders, employees, consumers and the rest of the marketplace. “You shouldn’t be allowed to just quit and cash out,” says Richard Leblanc, associate professor of governance, law and ethics at York University in Toronto.
Forget about concerns Balsillie’s liquidation was a sign Black Berry’s former long-time leader has no confidence in the company’s corporate reboot and the new BB10 operating system. Securities and Exchange Commission revealed Balsillie’s selloff of 26.8 million RIM shares. When he occupied the corner office in 2011, Balsillie was the third-largest individual shareholder with a 5.1% stake. The Canadian Coalition on Good Governance requires executives of publicly traded companies to hold a significant portion of their net worth in the corporation, not just while employed there, but “ideally for a period of time after cessation of employment.” This best practice is also advocated by governance groups in the U. “The board let him jettison all his shares rather than have a staggered period of containment for the sake of the company.” In any event, it’s not clear at which point in 2012 Balsillie unloaded his shares, but given that Black Berry’s stock price ranged between $6.22 and $18.32 during the past 52 weeks, he could have fetched between US$166.7-million and US$491-million.
RIM's troubles started with a surprise profits warning in December, which it blamed on product delays and the recession.