Research In Motion co-CEOs Jim Balsillie, left, and Mike Lazaridis talk to media after an Ontario Securities Commission hearing in Toronto on Thursday. (Nathan Denette/Canadian Press)

Research in Motion's co-chief executive officers were hit Thursday with big financial penalties in a settlement with the Ontario Securities Commission over backdated stock options.

Jim Balsillie was given a $5-million penalty and must pay $700,000 in costs to the OSC. Balsillie is also barred from serving as a director of a company for a year. He can remain as an executive with the company. Balsillie has already stepped down as company chairman.

Company founder Mike Lazaridis must pay a $1.5-million fine plus $150,000 in costs.

Balsillie, Lazaridis, along with RIM executive Dennis Kavelman, must pay back $38.3 million to RIM to cover financial benefits from the stock options that had not already been repaid. The same three men must also pay about $30 million to cover RIM's investigation costs.

The settlement was approved following a closed-door hearing in Toronto.

A review of RIM's policies and procedures is apparently one of the conditions in the settlement.

Following the hearing, Balsillie told reporters he was "pleased to put this behind us," adding that the executives took full responsibility for what happened. He would not comment on any of the specific fines or penalties in the settlement.

The Ontario market regulator had accused RIM officials, including Balsillie, Lazaridis and several executives, of getting back-dated stock options over the decade leading up to July 2006.

Half of $66M not reimbursed

The OSC probe began in early October 2006, shortly after the Waterloo, Ont.-based producer of the BlackBerry wireless device revealed that it had launched an internal review of its stock option grants.

RIM ultimately revised its past earnings by $250 million US to cover accounting errors uncovered in the review.

In its statement of allegations, the OSC said approximately 1,400 of 3,200 option grants made by RIM during the 10-year period were made using incorrect dating practices.

The regulator alleged that in many instances, the lowest share price in a period was chosen using hindsight in order to set the grant date and the exercise price for the option.

In the allegations, which were dated Feb. 3, the OSC said the "in the money" benefit of the incorrect options dating practice totalled $66 million. Before Thursday's hearing, approximately $33 million of that had not been reimbursed or repaid to RIM, or forfeited or cancelled.