Options backdating law

In prior posts, I have tracked options backdating lawsuit dismissals (refer here) and settlements (refer here).

Over the last few days, a number of additional backdating-related lawsuit dismissals and a settlement have surfaced.

Prosecutor the retried the case, winning another conviction.

And yesterday, Reyes was sentenced again, this time to 18 months.

For example, in the Ontario Securities Commission found that RIM engaged in improper backdating practices when certain high ranked individuals backdated options to a price that was "in the money".

This practice contravened both the TSX Rules as well as RIM's stock option plan that required options "to be granted at an exercise price not less than the closing price of RIM's common shares on the TSX on the last trading day preceding the date on which the Options are approved for grant".

Altschuler has successfully litigated cases relating to multi-billion dollar buyouts, investment stakes, tender offers and contests for corporate control, breach of fiduciary duty, financial and accounting fraud, insider trading, requests for company books and records, stock ," an executive summary that includes a collection of 57 case summaries and litigation updates reporting on complaints, motions, briefs, other pleadings, settlements and rulings involving stock options backdating litigation.Awarding employees with stock options those are dated prior to the actual grant date.The date chosen could be one when the company’s stock was at a low, so the options can be in-the-money at the time of granting itself.The Court considered the construction of the whole policy and held that the exclusion clause took effect on the backdated date chosen by the parties.Although backdating is generally permissible under the common law, a court will not give effect to backdating where the parties backdated the contract to mislead a third party.

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