Comverse Technology Inc. (Nasdaq:CMVT) has finally ended the backdating affair, after the company reported to the US Securities and Exchange Commission (SEC) that the New York Federal Court has approved its amended compromise agreement.
Under the agreement between shareholders and former senior executives, the company will pay shareholders $165 million, of which company founder Kobi Alexander, who has fled the US and is living in Namibia, will pay $60 million. Alexander will pay his share into a fund that will be used to pay for the arrangement.
The company does not have to honor the agreement if less than 5% of shareholders join it.
The timetable for the payments has also been amended. $1 million was paid with the signing of the agreement. $21.5 million will be paid on August 15. $30 million on May 15, 2011 and $112.5 million in November 2011.
Comverse's backdating scandal first broke four years ago when it became clear that the dates of options allocations were changed retroactively in order to increase profit.
Published by Globes [online], Israel business news - www.globes-online.com - on June 24, 2010
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