Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Diligent discloses staff share option blunder

Diligent discloses staff share option blunder

By Pam Graham

Jan. 18 (BusinessDesk) - Market darling Diligent Board Member Services is tidying up the way it grants share options to employees after finding it granted too many options to senior staff and did not provide a prospectus to others.

The company, whose board members include former NZX boss Mark Weldon, has embarrassingly had to advise NZX and the Financial Markets Authority of the breaches.

BusinessDesk understands that an investigation by a special committee of the board came about after the company was targeted by a US law firm, essentially a legal bounty hunter, looking for a fee for discovering the breaches.

Chairman David Liptak declined to comment on how the company first became aware of the issue but said it was working with authorities to resolve it.

Weldon is a member of the special committee and was not on the board when the breaches occurred.

The special committee has found that awards of stock options to chief executive Alessandro Sodi in 2009 and 2011, and a 2011 award to another employee exceeded caps in incentive plans operating at the time.

The options in excess of the caps will be cancelled and another way will be found to compensate the executives.

A number of smaller option grants to employees in New Zealand were also made in the absence of a prospectus and this "was not, or may not have been" in compliance with New Zealand regulations. The options were free.

The Financial Markets Authority (FMA) said it was working with the company to establish whether a breach occurred.

"The special committee determined that these instances of non-compliance were inadvertent," the company said.

Diligent is listed in New Zealand and its shares were down 0.9 percent at $5.50 in afternoon trading, having hit an all-time high of $5.61 earlier this week on strong annual revenue growth figures.

Because the company is incorporated in Delaware with over 500 shareholders, it is subject to the US reporting and regulatory requirements of the Securities and Exchange Commission (SEC) and the Securities Exchange Act of 1934.

The company said that it struggled with complex regulatory and compliance obligations in multiple jurisdictions with different rules during a period of financial difficulty and constrained resources in the years following the listing on the NZX in 2007.

"While the special committee's work continues, all regulatory issues identified will be fully self-reported to the NZX and FMA," the company said.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Fruitful Endeavours: Kiwifruit Exports Reach Record Levels

In June 2016, kiwifruit exports rose $105 million (47 percent) from June 2015 to reach $331 million, Statistics New Zealand said today. Overall, goods exports rose $109 million (2.6 percent) in June 2016 (to $4.3 billion). More>>

ALSO:

Economic Update: RBNZ Says Rate Cut Seems Likely

The Reserve Bank will likely cut interest rates further as a persistently strong kiwi dollar makes it difficult for the bank to meet its inflation target, it said. The local currency fell. More>>

ALSO:

House Price Action Plan: RBNZ Signals National Lending Restrictions

The central bank wants to cap bank lending to property investors with a deposit of less than 40 percent at 5 percent and restore the 10 percent limit for owner-occupiers wanting to take out a mortgage with a deposit of less than 20 percent, according to a consultation paper released today. More>>

ALSO:

Sparks Fly: Gordon Campbell On China Steel Dumping Allegations

No doubt, officials on the China desk at MFAT have prided themselves on fashioning a niche position for New Zealand right in between the US and China – and leveraging off both of them! Well, as the Aussies would say, of MFAT: tell ‘em they’re dreaming. More>>

ALSO:

Loan Sharks: Finance Companies Found Guilty Of Breaching Fair Trading Act

Finance companies Budget Loans and Evolution Finance, run by former 1980s corporate high-flyer Allan Hawkins, have been found guilty of 106 charges of breaching the Fair Trading Act for misleading 21 borrowers while enforcing loan contracts. More>>

ALSO:

Post Panama Papers: Govt To Adopt Shewan's Foreign Trust Recommendations

The government will adopt all of the recommendations from former PwC chairman John Shewan to increase disclosure and introduce a register for foreign trusts with new legislation to be introduced next month. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news