OI Corporation CEO Resigns Following Option-Dating Investigation
The company stated, “The limited controls and the lack of definitive processes for stock option granting and approval allowed for abuse, including on three separate occasions the apparent use of hindsight in the establishment of more favorable grant dates and exercise prices for options.” OI will restate its financial statements, reducing retained earnings and increasing additional paid in capital by $371,000. Corporate Secretary Jane Smith also resigned.
College Station, TX 3/23/07—William W. Botts, president and CEO of OI Corporation, has resigned following the completion of an investigation by a special committee into the company’s stock option practices (see IBO 1/31/07). The special committee reviewed stock option grants issued between 1985 and 2006 and found incidences of misdated option grants, the issuance of options after their expiration dates, and errors in the determination of exercise prices for automatic option grants to Board members. Mr. Botts was found to have tendered common stock to pay the exercise price of stock options without full disclosure to the Board that he used the high sale price on the day he exercised his stock options. On one occasion, there was evidence he backdated the exercise price to retain up to 7,004 additional shares. The company is currently undertaking remedial actions.
