Why the Wall Street System Is Busted
November 17, 2007
Merrill to Pay Chief $50 Million, More if Stock Rises
By ERIC DASH
Call him Wall Street’s richest mop-up man, at least for now.
John A. Thain, the new chief executive of Merrill Lynch, can expect an initial pay package of nearly $50 million as he tries to restore the firm’s reputation and risk- management practices as it grapples with the subprime mortgage problems.
The pay package, largely made up of stock and options, could be worth more than $120 million if Merrill stock rises more than $40 a share in the next two years.
. . . Mr. Thain’s pay package, by contrast, is similarly lucrative but through stock options is largely tied to increasing Merrill’s share price. Merrill shares have fallen 23 percent since August.
“If there is a dramatic increase in the stock price,” Merrill said in a statement, “shareholders will see an increase in value of tens of billions of dollars and as a result, he also will benefit.”