David Silver's  Instablog

With all the talk over the past five years about CEO compensation, I truly hope that Ford's (F) CEO Alan Mulally is not among those executives that get the vitriol from the Street. Over the weekend, Ford announced that 4.8 million shares vested for Mr. Mulally yielding $58.3 million ($34.5 million after taxes) as a result of various incentives being accomplished.

Let's paint a picture for you. It is 2009, the auto industry (and economy in general) is on the verge of collapse. Talk is that General Motors (GM) and Chrysler will be forced into bankruptcy and the rumors are starting to circulate about a government bailout for everyone in the auto industry. Enter the 4.8 million stock options for Mr. Mulally when the stock was trading at $1.86 per share (the stock today is trading above $12). Since that time, Ford has avoided bankruptcy and rebounded to see 2010 and 2011 be two of the most profitable years ever for the Dearborn, MI based company.

Ford also disclosed that it issued 1.2 million options to purchase stock to Mr. Mulally at $12.46 a share. He can't exercise any of the options for at least one year. He can't exercise the full value of the options unless he stays in his post for three more years. The company says Mr. Mulally can keep the options if he retires. Mr. Mulally continues to be questioned if he will retire soon, but has consistently downplayed the possibility.

Is it an unjustified anger that the public feels for such high CEO pay? Or is it just the belief that many of these executives do not earn their pay? I will say, I hope it is the latter, and that Mr. Mulally is not included in this group because, in my opinion, and many of the people that I speak to, Mr. Mulally earned every penny.

Disclosure: I am long F.