Research In Motion ( RIMM) agreed to strengthen its corporate governance practices as part of a settlement with a Canadian pension fund that had alleged the audit committee investigating RIM stock option grant practices may not have been truly independent. The trustees of the Ironworkers Ontario Pension Fund, which as of January owned slightly more than $ 1.75 million in RIM stock,
had earlier sought the permission of the Ontario Superior Court of Justice-Commercial List to start a shareholder suit against certain RIM directors. RIM agreed to adopt additional corporate governance measures to enhance the performance of its compensation committee and compensation procedures. The settlement measures include a commitment by RIM to exclude independent directors from receiving stock options, the preparation of a compensation committee charter by an independent corporate governance expert, and refinements to the rules governing board and committee meetings relating to executive compensation. As disclosed earlier, co-CEOs of RIM Jim Balsillie and Mike Lazaridis also agreed to pay $5 million each, and an additional $2.5 million each if necessary, to defray the costs incurred by RIM from a voluntary review of the company's historical stock option plan. The settlement is subject to approval by the Ontario Superior Court of Justice. An approval hearing is scheduled for Nov. 5. The news of the settlement comes as RIM shares touched an all-time high Friday, a day after the company reported its second-quarter earnings . Shares of RIM soared $12.87, or 12.8%, to close at $113.41.