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Research In Motion: Balsillie, Lazaridis Severance Pay Tops A Combined $12 Million

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RIM BALSILLIE LAZARIDIS SEVERANCE PAY
Jim Balsillie, left and Mike Lazaridis. The former co-CEOs of BlackBerry-maker Research In Motion will receive a combined $12 million in payouts for leaving their roles at the struggling company. | AP

TORONTO - The former co-CEOs of BlackBerry-maker Research In Motion (TSX:RIM) will receive a combined $12 million in payouts for leaving their roles at the struggling company.

In a document filed with securities regulators on Thursday, ahead of the company's annual meeting in July, RIM outlined the details of what each former executive receives.

Jim Balsillie will be paid nearly $8 million in salary and other compensation after stepping down as leader in January and leaving the company two months later.

Mike Lazaridis, who remains a member of the board, will be paid about $4 million in salary and compensation under the condition that he will "continue to make himself reasonably available" to help the company in the future.

The deal also gives Lazaridis his own office, executive assistant, as well as a car and driver for two years, at a combined value of about $733,000.

RIM says in the filings that Balsillie and Lazaridis "revolutionized the worldwide wireless industry with the introduction of the BlackBerry and forever changed how the world communicates."

The company has seen its stock plummet and its financial results significantly weaken in the face of intense competition from the rival Apple iPhone and devices using Google's Android operating system.

In January, RIM promoted Thorsten Heins to the leadership role formerly held by Balsillie and Lazaridis.

Heins was paid about $10.2 million for the company's 2012 financial year including more than $9.5 million in stock-based compensation. He was paid $1.9 million including about $825,000 in stock-based compensation for 2011.

His terms also include an agreement to be paid his annual base salary for 24 months if the company decides to terminate his employment "without cause or for good reason."

Karima Bawa, who announced her retirement as RIM's chief legal officer last month, will be paid a lump sum of about $982,000, or 24 months of salary, to maintain a "reasonable ongoing co-operation" with the company and non-compete agreements. Bawa received $2.6 million in salary and other compensation in 2012.

Since Heins took the reins at the company he has outlined plans to reduce its expenses. The move will include laying off an unspecified number of staff in an effort to save $1 billion by the end of fiscal 2013.

RIM hopes that a new line of BlackBerry phones that are powered by its BlackBerry 10 operating system, will help turn around its results when they're released sometime later this year.

However, speculation has been growing that RIM's fate is sealed, and that the BlackBerry maker will eventually be sold off either as a whole or in parts.

In late May, the company said it expected to post an operating loss in the first quarter due to weak BlackBerry sales. The results will be issued on June 28.

RIM has also hired J.P. Morgan Securities LLC and RBC Capital Markets to evaluate various strategies, including potential partnerships and licensing.

Also Thursday, the company announced it has nominated former Goldman Sachs managing director Timothy Dattels to be an independent director. He replaces telecom executive Antonio Viana-Baptista who is not seeking re-election, after serving on the board since 2009.

Shares of RIM were down 3.6 per cent, or 39 cents, to close at $10.61 on the Toronto Stock Exchange.

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