By Gurmukh Singh, IANS,
Toronto : BlackBerry maker Research In Motion’s shares fell only slightly Thursday after the news that its two co-CEOs face a multi-million dollar fine from the market regulatory body.
The co-CEOs – Jim Balsillie and Michael Lazaridis – face up to $100 million in fines from the provincial Ontario Securities Commission for their role in a stock option backdating controversy.
Stock options backdating sets the grant date of shares retrospectively when the stock price was low, thus giving instant paper gains for employees.
The two co-CEOs had reportedly benefited to the tune of US $1.6-million each from stock option backdating which was probed by a panel set up by the RIM board in 2007.
The panel found that RIM had backdated more than 40 percent of stock options granted to employees since 1996.
The panel also found that 12 of the 16 option grants made to the two co-CEOs between 1996 and 2006, to acquire a total of two million shares, were priced using an incorrect date.
RIM shares slipped about 1.6 per cent to close at $65.67 Thursday after the Globe and Mail daily carried the news. RIM shares once traded as low as $64.07.
Overall, the Toronto stock market retreated 134.5 points to close at 8,623.4. After posting a gain of five percent in the first week of the New Year, North America’s third largest stock exchange has slipped into the red territory.
Shares in the financial sector dropped four per cent even as major banks announced preferred shares to strengthen their cash position.
Despite the markets turmoil, the country’s central bank Thursday said that the economy will bounce back in the second half of this year.
The Bank of Canada also forecast the Canadian economy will grow by 3.8 per cent next year.