Ford Motor Co said on Friday it would pay veteran aerospace executive Alan Mulally $18.5 million to join the troubled automaker as its new chief executive in addition to an annual salary of $2 million.
The one-time payments include a hiring bonus of $7.5 million and $11 million to offset the compensation Mulally gave up for ending his tenure as head of Boeing Co's profitable commercial plane division, Ford said in a filing with the US Securities and Exchange Commission.
Mulally, 61, was also granted stock options worth about $10.5 million and $5.26 million in restricted stock grants, according to details provided by Ford.
A clause in Mulally's contract also entitles him to a payment of $11 million if Ford undergoes a change in control or he is let go for any reason other than "cause" before 2011, Ford said in its regulatory filing. Ford has also agreed to waive the vesting requirement on Mulally's stock options and restricted stock grants in such a case.
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