Thorstein Heins Mangles BlackBerry, Walks Away With $16 Million Severance

Tyler Durden's picture

The last time we looked at Thorsten Heins' potential "golden parachute" farewell gift from Blackberry for, well, completing the destruction of the company started by former Co-CEOs Mike Lazaridis and Jim Balsille when he took over in early 2002, the amount could have been as gargantuan as $55 million. This number has subsequently been revised modestly lower, and while nobody is precisely sure just what Heins is entitled to, according to the Globe and Mail's latest calculation, the golden parachute in question could be as large as $16 million. Then again, considering RIMM stock back then was $18/share and by the time Heins left BBRY will be just over $6, one wonders if instead of any bonus Heins shouldn't instead be paying the company's long suffering shareholders for virtually destroying what was once the world's dominant smartphone brand.

From Globe and Mail:

Outgoing BlackBerry Ltd. chief executive officer Thorsten Heins could leave the company with about $16-million (U.S.) in severance payments and shares under the terms of a new employment agreement he signed with the company in April, regulatory filings show.


The company’s latest shareholder proxy circular, filed in May, says Mr. Heins would have been eligible to receive as much as $55.6-million in severance if the company was sold and he was dismissed. But he is also eligible for a large severance payout – as much as $22-million based on March figures – if he is simply terminated with no sale of the company.


However, his final severance amount will vary from the March calculation included in the proxy circular because much of the pay comes from equity holdings, which have changed since the chart was done in March.


BlackBerry announced Monday it has ended takeover talks with Fairfax Financial Holdings Ltd., and said Mr. Heins is leaving the company. A company spokeswoman said BlackBerry could not comment on Mr. Heins’s severance payments “at this time.”


Under the terms of the severance agreement, Mr. Heins is eligible to receive two times his base salary – worth $3-million in total – as well as a portion of his annual bonus for the current year, based on his standard corporate and individual performance factors. As of March, that was estimated to be worth $2.8-million, but it is unknown what his bonus payout is currently worth.


The equity components of his severance are the largest piece, however, estimated at $16-million as of March.

His current equity holdings in BBRY, aside from incentive option grants, amount to a tiny 180k shares of stock.

Mr. Heins also has share units acquired previously, which are currently worth about $4-million based on BlackBerry’s share price of $7.10 on Monday morning, and has 813,000 stock options, which are underwater and not exercisable based on the company’s current share price.


Both the old share units and his stock options will continue to vest for 24 months, which means the final payout under his severance agreement will not be determined for two years.


He also owns 179,504 common shares, worth about $1.3-million based on Monday’s share price.


Based on the current value of his common shares and share units, along with the $5-million payout for his new share units and his eligible salary and bonus payments, Mr. Heins could leave BlackBerry with about $16-million.


That total is not the final payout value, however, because his options and share units will not fully vest for two years and the final bonus amount payable is not yet known.

It is known: it is too high. And the poetic irony? If Heins ends up being hired as a bankruptcy advisor by a company that may one day advise BBRY on its potential chapter 11 or 7 filing. That would be the definition of true "full lifecycle" service coverage.

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IndyPat's picture

Falling FORWARD!

Wow. Hope he's able to scrape by until he finds another job he's not good at.

HoofHearted's picture

Seriously, if I could get a $16MM severance from my job, I wouldn't bother looking for the next one. Sure, Uncle Sugar could take "his" half of the severance, no problem. Pay off bills, get set up in the house and with cars with another million. So now I have to find a way to live on $7MM and the interest. Even 1% leaves me with an okay amount, considering that I have no house payment or car payment. Oh shit, Obamacare just fucked that up for me. Nevermind...

IndyPat's picture

Yeah, but want your next package to be moar than the last one. Looks better on the resume. He's clearly established his severance earning potential.

Buckaroo Banzai's picture

I don't always take a struggling company and run it right into the ground, but when I do, I prefer to grab $16 million on the way out the door.


NoDebt's picture

I'm telling you their CEO was just never the same after all that time on the island with the Skipper, Gilligan, Mary Ann, Ginger and that awful nagging wife of his.  Poor choice to run a tech company.  Can't spend that much time on a deserted island and not fall behind the technology curve.

johnconnor's picture

I'd do the same thing but we are thinking like the peasants we are...

If you look from his point of view just think that cocaine is expensive, high class hookers are 10K and the new G-6 he was going to get is over 20 million.... if only he could have laid off a few thousands more employees before this thing implodes...he needs moar!

Dareconomics's picture

Not only does he get the severance, but Uncle Ben will maintain the value of his securities portfolio indefinitely:

Son of Loki's picture

“There’s never been a better time then now to be a Wall Street CEO.”

kralizec's picture

Too bad for them...I could have fucked up for just $8m!

pelican's picture

This is one of the reasons the US is done.

kralizec's picture

The past tense is a nice touch.  +

lcs's picture

The US is done because Apple beat BB at their own game, or because the loser got a consolation prize?

malikai's picture

Just wait until you see the next guy.

NidStyles's picture

Then people wonder why the economy is in such dire conditions, it's because of this culture of creating wealth out of thin air and congratulating yourself for your efforts by giving yourself a huge bonus for doing nothing...

akak's picture

The only blackberries I am familiar with are the kind in my pies.

This modern obsession with electronic gadgets of all kinds, adult toys for the consumerist sheep really, is utterly sickening.  All hail the ongoing juvenilization of society.

Pure Evil's picture

Just as long as the peasants are comfortably distracted while their liberties are slowly eliminated.

css1971's picture

Elop and Balmer put this guy into the shade.

Buckaroo Banzai's picture

Yeah, but in fairness, Elop had a different job to do. Elop was supposed to run the company off the cliff so Ballmer could stand at the bottom and pick up the pieces for pennies on the dollar.

Heins' job was to ruin the only cellphone company that had its own secure, encrypted communications network.

See the difference? Elop was supposed to take the most valuable cellphone company in the history of the world and massively cripple it, making sure to leave something of value behind. Heins on the other hand was hired to make sure BBRY went away completely.

alphamentalist's picture

did HR confiscate his BB during his exit session?

IndyPat's picture

No shit...and did security help him carry his money bags to the parking lot?

Cacete de Ouro's picture

Anagrams of Thorsten Heins:

Just a few:

Thinnest Horse
Herein Nth Toss
Nether Shit Son
Three Shots Inn
Sheets Horn Nit
These Nth Irons
Teeth Horn Sins
Intense Shh Rot
Entire Shh Snot
Sneer Thin Shot
Resent Thin Hos
Enter Shits Hon
Seen Shit Thorn
Teen Shit Shorn
Reset Thin Nosh
He Hornets Nits
He Tennis Short
Eh Interns Shot
Eh Rotten Shins

akak's picture

You neglected to add:


Three snot shin

No her hens tits

Sith teen horns

Snort hen heist

Shorten his net

Teeth horn sins

Her nets no shit

His rotten hens

HoofHearted's picture

Golden parachute? Looks like the shareholders would prefer to give Heins a golden shower.

alien-IQ's picture

16 mil severance to drive a company to the ground? Fuck, where can I sign up for a gig like that? I'll destroy a company for half that.

knukles's picture

For a mere $250K I'd be pleased to advise anybody on how to fuck things up.
What with my sick, cynical, dark humor, we're guaranteed fun in the crematoriums. 

Colonel Klink's picture

Well needed after the rope and guillotines.  Oh wait, that's the other problem.

fonzannoon's picture

He may have walked with a few bucks but it's going to be tough for him with no pension and free healthcare. With ZIRP he is not incentivized to save, so that 16 mil has to go into the market, so he is going to have to take on a lot of risk. Maybe he can leverage this into a position as Sebelius replacement and get himself hooked up with some benefits.

Can someone please explain to me how we will ever get hyperinflation when wages and benefits keep getting cut? Won't workers have to unite and demand higher pay for inflation to take off?

NidStyles's picture

Hyper-Inflation does not require wage increases to start. The wage increases are the side-effect of the eclipsing of Hyper-Inflation in the market. In other words the wage increases come after the Hyper-Inflation has already taken over and gone exponential.


The stagflation of the 70's was a very narrow dodge of Hyper-Inflation. Now those mechanisms that were meant to keep it in check are gone, so the inevitable will just be all that more likely to happen sooner rather than later. Rest assure though, it will happen.


This is just another one of the examples of the monetarist confusion of the issue and for some reason their inability to actually understand what inflation is and what causes it. I do think they have on thing correct though, and that is the cyclic nature of the problem. They are cyclically wrong and proving themselves to be idiots every time they formulate their schemes thinking they are the first to try it. 6000+ examples from previous failures do not lie, what they are advocating is only in their best interest, and they will fuck everyone else without blinking. 

NOTaREALmerican's picture

Re:  Fuck, where can I sign up for a gig like that?

You've got to be a pathological optimist first. 

It helps if you can level-set the table-steaks in a going-forward space too, but - really - you need that optimism first. 

trebuchet's picture

hhahaa not a hope in hell of being an optimist if reading ZH - no room for realism in todays boardroom but hey ho!

carbonmutant's picture

Camera Companies want some of those patents....

ebworthen's picture

Rewarding failure, the new American tradition.

ebworthen's picture

Six of one, half-dozen of another; but thanks, I stand corrected.

"Rewarding Failure; the new North American Tradition".

Scalaris's picture

Let's contemplate for a moment, the seemingly, to many, reasonable ratio of management remuneration to the degree of fucking up a company.

I understand that corporate accountability is an oxymoron but this borders to the ridiculously absurd like no other.

NOTaREALmerican's picture

Re:  ridiculously absurd like no other

He took a tremendous risk signing on to lead Blackberry.   I think 16M barely covers the future hardships he'll encounter from this experience.   I'm sure he's suffered enough and we - as a society - need to help our job creators through difficult times like this.   

I'd propose we shouldn't tax this 16M either.   We - as a society - should be greatful that he took extrordinary risks; risks that all of us would have benefited from had he successed.    That 16M is just a thank-you from a greatful society to the risk-takers who made this country great-n-glorious.

Frank N. Beans's picture

a "modestly lower" amount, from 55 million to 16 million.

somehow I think that's more that modestly lower, but what the hay, 16 mil is 16 mil


IndyPat's picture

16 mil is 16 mil moar than the righteous old school foot-to-ass he deserves.

robertocarlos's picture

you're looking at it the wrong way. Heins gave you the chance to buy BB for a 2/3rds discount. Outstanding.

FuzzyDunlop21's picture

I wouldnt buy BB with someone else's money

Dagny Taggart's picture

But the guy has options... now he is qualified for academia or public service.

NOTaREALmerican's picture

Really, hasn't the man suffered enough?   He'll use that 16M to create more jobs in the future.

willwork4food's picture


"Thorsten, you fucked up our company with your new ideas that suck moose. We've had enough.Thorsten, you've got 48 hours to clean out your desk. "

By the way, here's 16MM.

IndyPat's picture

You know that interview question they always ask? Where do you see yourself in 5 yrs?
Next time, I'm going to answer "walking away from this company with 16 mil in severance"
I'm in for sure.

syntaxterror's picture

Damn, where do I send my resume? I'm pretty sure I'm "ready for the challenge" to "lead Blackberry through these challenging times" and earn millions upon millions of Bernanke Bucks.

Oh, wait I just found the link to submit my resume:

Z_End's picture

So apprently failure IS an option... take note kiddies...

NoDebt's picture

Yeah.  Somebody wake up Obama and break this revelation to him gently.