Enterasys Networks will pay $17.4 million in cash and $33 million in stock to settle shareholder lawsuits related to an accounting scandal.
In addition, the Andover, Mass., network equipment maker will adopt “corporate governance changes.” A spokesman was unable to offer specific measures.
Neither Enterasys, nor its former executives or directors, was not required to admit wrongdoing.
“Settling all of these cases at one time will put this litigation completely behind us, allowing management to focus on running the company’s business,” CEO William K. O’Brien said in a statement.
The company expects that the settlement approval and claim administration process could be completed as early as December, 2003.
Enterasys will record a charge of approximately $15.9 million, or 8 cents per share, in the third quarter in connection with the settlement. Insurers will pay about $34.5 million of the settlements seeking additional funds from other insurers.
The lawsuits stem from allegations that an Enterasys employee in its Asia-Pacific unit improperly booked revenue.