The agreement with Lone Star Steakhouse & Saloon Inc., calls for a handful of current and former directors to repay the company $4.7 million through repriced stock options or payments, according to a Sacramento Bee report. Another $3 million will be paid by an insurance company.
CalPERS, the nation’s largest public pension fund, sued Lone Star chief executive Jamie Coulter and other directors in October 2001 over allegations they approved self-dealing transactions, lavish stock option grants, and other benefits, which the fund said cost more than $100 million from 1995 to 2001.
Since the lawsuit, pension fund officials said the company has made a series of corporate governance concessions, including the addition of three new independent directors and the elimination of an anti-takeover poison pill measure, according to the Bee report.
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