Nov. 6 (Bloomberg) -- Merrill Lynch & Co. Chief Executive Officer John Thain, who received $15 million when he joined the brokerage last December, may get as much as $5.22 million more if a takeover by Bank of America Corp. is completed by Dec. 31.

The so-called change-of-control award reflects the cash value of Thain's stock-based compensation at Merrill, Charlotte, North Carolina-based Bank of America said in a proxy filed with the U.S. Securities and Exchange Commission on Nov. 3. Nelson Chai, Merrill's chief financial officer, may receive $1.17 million, the bank said.

Merrill Lynch, Goldman Sachs Group Inc. and other Wall Street firms are being asked to justify executive pay from regulators including New York Attorney General Andrew Cuomo after the federal government agreed to spend $700 billion rescuing the industry from the global credit crisis. Merrill was forced into the takeover after its share price tumbled 80 percent and it lost $24 billion over five quarters.

``Change of control agreements are absolutely routine, but what isn't routine is how little this is,'' said Henry Higdon of Higdon Partners LLC, a New York compensation consulting firm. ``Thain basically saved Merrill Lynch. Let's remember that the former CEO, Stanley O'Neal, got a $161 million package for torpedoing the company.''

Bank of America named Thain, 53, to head Global Banking, Securities and Wealth Management. The business includes the corporate and investment bank and most of the wealth and investment-management businesses, which made up 35 percent of revenue at Bank of America during the first half of this year.

Management Group

Thain on Oct. 17 was named to Bank of America's 11-member executive management group, headed by Chief Executive Officer Kenneth Lewis. He's the only Merrill representative in that group.

Bank of America hasn't completed compensation agreements with Thain and three other senior Merrill Lynch executives, the company said in the filing. In negotiating the merger in September, the bank said it would ``work in good faith'' in deciding how to handle stock-based awards for Thain and other Merrill Lynch executives.

Bank of America took advantage of Merrill's slumping share price to buy the firm, the world's largest securities brokerage, for $50 billion. The Sept. 15 announcement followed Bank of America's purchase on July 1 of Countrywide Financial Corp., the largest U.S. mortgage lender, for $2.5 billion.

Treasury Plan

Bank of America is receiving $15 billion and Merrill will get $10 billion under a Treasury plan aimed at boosting bank capital and prompting more lending. Nine banks contacted by Cuomo are receiving a combined $125 billion, with hundreds of other U.S. banks also likely to receive funds.

Thain received the $15 million cash bonus when he was hired last December to succeed O'Neal, who received a $161 million buyout after he was forced out. Chai, 43, who also joined Merrill last December, received a $2.5 million bonus, half in cash and half in restricted shares.

When he was hired at Merrill Lynch, Thain was offered an annual salary of $750,000, 500,000 restricted shares and 1.8 million options. He was paid a total of $9.4 million as CEO of NYSE Euronext in 2006, including $5 million in cash.

Other Merrill Lynch executives stand to gain from change-in- control provisions, including strategy head Peter Kraus, who joined in September and may be eligible to collect on a package valued at about $95 million when his appointment was announced in May, people familiar with the matter said. Kraus, a former Goldman Sachs executive recruited by Thain, was on the job less than a week when the Bank of America deal was struck.

Thousands of Merrill Lynch and Bank of America employees will lose their jobs because of the merger as part of a plan to cut $7 billion in expenses, Thain said on Oct. 20. The bank's purchase of Merrill Lynch is expected to be completed on or about Dec. 31.

To contact the reporters on this story: David Mildenberg in Charlotte at dmildenberg@bloomberg.net; Josh Fineman in New York at jfineman@bloomberg.net.

Last Updated: November 6, 2008 13:56 EST