Cramer forgoes salary, bonus for royalty payments
TheStreet.com founder Jim Cramer has a new, three-year employee contract that began earlier this month where he won’t be paid a salary or a bonus from the financial news site and will instead be paid a royalty fee based on the revenue produced from one of its subscription products.
The royalty will be based on the revenue derived from TheStreet.com’s Action Alerts PLUS subscription service that he authors. Cramer also will receive a grant of restricted stock units, which will vest over three years.
Cramer’s salary in 2010 was $1.87 million, although he delayed his pay raise until later in the year. The previous year, his pay was $1.56 million.
“Given the length of this new contract and my current plans for the way I plan to spend my time beyond that, I expect that this will be the last long-term agreement between me and the company,” said Cramer in a statement filed with the SEC back in December. (I can’t find where any media covered the announcement.) “Although I’d expect to continue participating in the company’s success beyond that in some manner, I’ve made this decision now as I want to be mindful to set the stage for a transition far enough out into the future that ensures the business will be well prepared to continue, from a position of strength, beyond my involvement.”
Action Alerts PLUS is where Cramer tells subscribers what trades he’s going to make – buy or sell – with the funds of his charitable trust, before he makes the trade. The portfolio in his charitable trust — 100 percent of the profits will go to charity — has consistently beaten the S&P 500 since its inception nine years ago.
The SEC filing can be found here.
Cramer owns more than 4 million shares of the company, or about 12.5 percent. At Tuesday’s closing price of $2.96, those shares are worth more than $12 million.