Today I enjoyed reading an article from my friend Hugo Miller over at Bloomberg. He nicely summarizes the fact that Thorsten Heins stands to make $55.6 million in the event that BlackBerry is sold, and he is ousted as CEO. The details are all spelled out in a proxy filing from May.

I’ve read through the Bloomberg story and the proxy filing.  The situation is fairly complex, and I haven’t bothered to do all the math for the various possible scenarios.  But it is accurate to say that Thorsten Heins stands to be paid significantly more money if he is terminated in the event of a sale of BlackBerry compared to a termination that does not involve a sale of the company.  The legal speak for a sale of the company you’ll find in proxy filings is “change of control”.

What do you think is easier to do:  Sell the company or successfully turn things around?  At this point, and in May when this filing was made, I’d say it might be easier to get yourself ousted by selling the company. 

So why would the board actually structure an agreement that incentivizes the CEO to sell the company like this?  I don’t know.  I won’t pretend to know all of the nuances involved in structuring executive compensation.  But at first blush, this seems to justify some scrutiny.

The executive compensation agreement that Bloomberg points to is a few months old now.  The reason it’s relevant now is because BlackBerry has announced its intention to explore a sale of the company.