Lehman's Fuld suffers wealth hit as shares fall

By Martha Graybow

NEW YORK (Reuters) - Lehman Brothers' chief executive would likely walk away with millions of dollars in accumulated stock and other compensation in the event he leaves the struggling firm -- but it's a payout that's quickly losing value.

Were CEO Richard Fuld to follow in the footsteps of other top Wall Street executives who have departed amid the credit crisis, he could leave with about $65 million (36 million pounds), based on Lehman's LEH.N Friday morning stock price of $3.73, according to an analysis by executive pay consultant James F. Reda & Associates.

The $65 million calculation is based on what the 62-year-old Fuld could be entitled to collect if he retires, as outlined in compensation arrangements detailed in the company's annual proxy filing in March. Fuld, who joined Lehman in 1969 and has been CEO for 15 years, is its biggest individual stockholder.

Fuld's tenure at Lehman has come into question not only because of the dramatic 76 percent loss in value of its shares this week but because of the possibility the firm will be sold, a development that could occur as soon as this weekend.

Lehman and U.S. officials were in discussions about a number of options, including a complete sale, sources with direct knowledge of the talks told Reuters on Thursday night.

A Lehman representative, Randy Whitestone, declined to comment on Friday on Fuld's future or his compensation arrangements.

The $65 million tally includes 8.6 million in unrestricted shares Fuld holds that were worth $32.1 million as of Friday morning. The value of those shares is down from $582 million in November 2007 when Lehman stock traded at a 12-month high of $67.73.

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