Human Capital & Careers

Monster Bitten by Backdating

The job listing company takes a $340 million charge for option grants that were "intentionally" misdated, and implicates its former founder and the...
Stephen TaubDecember 13, 2006

Monster Worldwide announced on Wednesday a charge of $339.6 million for stock options granted between 1997 and March 31, 2003 after a special committee determined that a “substantial number of stock option grants” had an incorrect exercise price as a result of incorrectly dated grants.

“In a significant number of instances,” the parent of jobs website monster.com said Wednesday in a statement, “the stock price on the assigned date . . . was lower, sometimes substantially lower, than the price on the date the award may be deemed to have actually been determined.”

The misdating was “done intentionally” by former employees “in positions of responsibility,” the company said. Monster did not directly identify the former employees.

However, the statement noted that Monster fired vice president, general counsel, and secretary Myron Olesnyckyj, for cause, on November 22, adding that his firing was the result of the committees review of the company’s historical stock-option grant practices.

Likewise, Monster announced in October founder Andrew McKelvey resigned as chairman emeritus, and declined to be interviewed by a special committee of the board charged with reviewing stock-option grants.

In its filing on Wednesday, Monster said the company is revising its disclosure of related party transactions as a result of its investigation into transactions between the company and McKelvey or individuals affiliated with him. McKelvey recently reimbursed the company $533,046, which includes interest, for expenses paid by the company from 1996 through 2006. The company added that it continues to seek reimbursement, plus interest, for other items.

On Wednesday, the company filed amended reports for 2005 and the first quarter of 2006 and finally filed its second quarter report.