Research in Motion Co-CEO Jim Balsillie is seen in this file photo speaking at the Toronto Board of Trade dinner on Mon., Jan. 29, 2007 in Toronto. (CP / Nathan Denette)
View larger image Research in Motion President and inventor of the Blackberry, Mike Lazaridis, poses with his Order of Canada after being invested into the Order of Canada at a ceremony at Rideau Hall in Ottawa on Oct. 6, 2006. (CP / Tom Hanson) Research In Motion and Rogers introduced the sleek, elegant and performance-driven BlackBerry 8800 on Feb. 12, 2007. (CP / CCNMATTHEWS)
Balsillie out as chairman of BlackBerry maker RIM
CTV.ca News Staff
Research in Motion co-CEO Jim Balsillie is resigning as chairman after the company, which makes the popular BlackBerry handheld device, reported over US$250 million in stock option accounting errors.
"Consistent with current best practices in corporate governance, the roles of chairman and CEO are being separated,'' the firm said.
"Mr. Balsillie has voluntarily stepped down from the role of chairman to allow future consideration of a non-executive chairman by the nominating committee.''
The company, based in Waterloo, Ont., said Monday that that Balsillie will stay on as director and as co-chief executive with Michael Laziridis.
The errors, which were revealed after an extensive review, mean RIM will have to restate its annual financial statements for 2004, 2005, 2006 and for the first quarter of 2007.
Balsillie and Laziridis have both offered to pay RIM up to $5 million each to help offset costs incurred by the review and the restatement.
"RIM has agreed to accept this voluntary payment," said the firm.
No deliberate wrongdoing was found in the review but the company will have to reduce the amount of previously reported earnings prior to the end of 2006 by about US$250 million.
The company will also reorganize its board of directors and replace the chief financial officer.
Further, top RIM managers will remain subject to a cease-trade order while financial reports are re-examined by Canadian and U.S. regulators. The company is also facing shareholder lawsuits over the company's financial reports.
RIM said it doesn't expect any further material adjustments to the current or future financial years' operating results.
With files from The Canadian Press
Research In Motion Ltd. (RIM) co-chief executive and chairman, Jim Balsillie, has resigned voluntarily as chairman after an internal review revealed irregularities with how the company accounted for stock options.

The review was carried out over the past 7 months and indicates that, Canadian BlackBerry maker, RIM, will have to restate earnings for all of 2004, 2005, and 2006, and for the first quarter of 2007. The company will have to lower previously reported earnings by approximately US$250 million.

The review committee indicated that RIM "failed to maintain adequate internal and accounting controls with respect to the issuance of options in compliance with the Company’s stock option plan, both in terms of how options were granted and documented, and the measurement date used to account for certain option grants". 

Although the review finds that there was no deliberate misconduct, both Balsillie and co-chief executive, Michael Lazaridis, have agreed to pay, voluntarily, up to $5 million each to compensate the company for the costs of the review and restatement.

All RIM directors and C-level officers will have to pay back any monies received incorrectly as a result of the option irregularities.

Balsillie will retain his positions as co-chief executive and director. In a press release, the company stated that "consistent with current best practices in corporate governance, the roles of chairman and CEO are being separated". Current RIM chief financial officer, Dennis Kavelman, will move to the position of chief operating officer.

RIM is a designer, manufacturer and marketer of wireless solutions for the worldwide mobile communications market and is listed on the Nasdaq Stock Market and the Toronto Stock Exchange.