By: E&P Staff Chicago-based Sun-Times Media Group Inc. said Wednesday evening that it is investigating the possible backdating of stock options awarded to key employees when the company was controlled by Conrad Black.
The company said it is looking into options awarded through 2003, when it stopped issuing stock options.
?While the investigation is not yet complete, preliminary results indicate that the grant dates on some stock option awards were misdated between 1999 and 2002,? the company said. ?Based upon the preliminary results, management believes that the amounts resulting from option misdating do not have a material impact on the financial statements for the relevant periods.?
The investigation is being conducted the Special Committee of the company?s board -- the same committee that last year, in a 500-page report, accused Black and other key executives of looting the Chicago Sun-Times publishing company of more than $400 million over eight years.
Black and three other executives of the company, which was then known as Hollinger International, have been indicted on federal racketeering, wire fraud, money laundering and tax charges for allegedly stealing $80 million in improper payments and contracts. They have all pleaded not guilty, and have been scheduled for trial next March.
F. David Radler, Black?s long-time lieutenant and a former Sun-Times publisher, has pleaded guilty to a single charge of mail fraud in a plea agreement that includes a 22-month jail sentence and a pledge to testify against Black and others.
The backdating scandal has so far caught up more than 160 corporations, including such prominent companies as Apple and United HealthCare. Sun-Times Media Group is the first newspaper company to reveal it may have misdated options.
In the practice, options awarded to key employees are backdated to a date when the company stock price was low, allowing a higher profit when the executive cashes out the option.
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