BlackBerry Head Ousted; Earnings to Be Restated

Research in Motion, maker of the BlackBerry e-mail phone, will restate earnings by about $250 million and said James Balsillie will give up his post as chairman following a review of its stock-options grants.

Research in Motion did not find intentional misconduct by its executives, according to a statement released by the company, based in Waterloo, Ontario. The restatements, which are not yet complete, cover more than three years of results dating back to 2004.

The adjustment exceeds an earlier prediction by Research in Motion, which forecast in January that restatements would cut past earnings by more than $45 million. In concluding its options probe, the company said Balsillie would remain co-chief executive as it separates the roles of chairman and chief executive to upgrade corporate governance.

Research in Motion is one of at least 200 companies that have disclosed internal or federal investigations into options. Investigators are trying to determine whether companies inflated the value of employee options by backdating or timing the grants to coincide with days when the stock price was low.

Balsillie and co-chief executive Michael Lazaridis will voluntarily contribute $8.5 million to cover some costs of the review and the restatement, the company said. Directors and officers will return any benefit from mispriced options, the company said.

All grants except those to the company's chief executives were made "by or under the authority of" Balsillie, the company said. A special committee of the board found the company had "failed to maintain adequate internal and accounting controls with respect to the issuance of options in compliance with the company's stock option plan," it said.

Balsillie said in an interview yesterday the company's options probe "hasn't affected our business one bit."