An authentic stock certificate
issued to Merrill Lynch, Pierce, Fenner & Smith for
shares in the Howard Johnson Company
. Nice condition with
no folds. Nice vignette at the top of an allegorical female figure flanked
by two shadow scenes. Printed signature of "Howard B. Johnson"
The company was founded on January 6, 1914, when
Charles E. Merrill & Co. opened for business at 7 Wall Street in New York
City. A few months later, Merrill's friend, Edmund C. Lynch, joined him, and in
1915 the name was officially changed to Merrill, Lynch & Co. In 1916,
Winthrop H. Smith joined the firm. In its early history, Merrill, Lynch
& Co. made several successful investments. In 1921, the company purchased
Pathé Exchange, which later became RKO Pictures. In 1926, the firm made its
most significant financial investment at the time, purchasing a controlling
interest in Safeway, transforming the small grocery store into the country's
third largest grocery store chain by the early 1930s.
In 1940, the firm merged with E. A. Pierce & Co.
and Cassatt & Co. and was briefly known as Merrill Lynch, E. A. Pierce, and
Cassatt. The company became the first on Wall Street to publish an annual fiscal
report in 1941. Also in 1941, Fenner & Beane joined the firm, and the name
became Merrill Lynch, Pierce, Fenner & Beane.
After Edmund Lynch's death in 1952, the company changed its name to Merrill
Lynch & Co. and was officially incorporated. The merger made the
company the largest securities firm in the world, with offices in over 98 cities
and membership on 28 exchanges. At the start of the firm's fiscal year on March
1, 1958, the firm's name became Merrill Lynch, Pierce,
Fenner & Smith and the company became a Big Board member of the New
York Stock Exchange.
On November 1, 2007, Merrill
Lynch CEO Stanley O'Neal left the company, after being criticized for the way he
handled the subprime mortgage crisis and for discussing in public the
possible merger with Wachovia, without being authorized by the board to do so.
He left Merrill Lynch with about US $161 million worth of stock options and
retirement benefits. John Thain, CEO of the New York Stock Exchange, succeeded
him as CEO on December 1, 2007. On January 17, 2008, Merrill Lynch
reported a $9.83 billion fourth quarter loss incorporating a $16.7 billion write
down of assets associated with subprime mortgages. On April 17, 2008, Merrill
Lynch reported a net loss of $1.97 billion for the first quarter of 2008.
Merrill responded to its losses by raising capital through the sale of preferred
shares, however experts suggest that such a strategy may pose a risk to the
company's credit rating which could cause an increase to the company's borrowing
In November of 2007, Merrill Lynch announced it would
write-down $8.4 billion in losses associated with the national housing crisis
and remove E. Stanley O'Neal as its chief executive. O'Neal had earlier
approached a rival bank for a merger, but the talks ended after O'Neal's
dismissal. In December 2007, the firm announced it would sell its commercial
finance business to General Electric and sell off major shares of its stock to
Temasek Holdings, a Singapore investment group, in an effort to raise capital.
The deal raised over $6 billion. In July of 2008, the new CEO of Merrill Lynch,
John Thain, announced $4.9 billion fourth quarter losses for the company from
defaults and bad investments in the ongoing mortgage crisis. In one year between
July 2007 and July 2008, Merrill Lynch lost $19.2 billion, or $52 million daily.
The company's stock price had also declined significantly during that time.
Andrew Cuomo, New York Attorney
General, threatened to sue Merrill Lynch in August 2008, over their
misrepresentation of the risk on mortgage-back securities. A week earlier,
Merrill Lynch had offered to buy back $12 billion in auction-rate debt and said
they were surprised by the lawsuit. Three days later, the company froze hiring
and revealed that they had charged almost $30 billion in losses to their
subsidiary in the United Kingdom, exempting them from taxes in that country. On
August 22, 2008, CEO John Thain announced an agreement with the Massachusetts
Secretary of State to buy back all auction-rate securities from customers with
less than $100 million in deposit with the firm, beginning in October 2008 and
expanding in January 2009. On September 5, 2008 Goldman Sachs downgraded Merrill
Lynch's stock to "conviction sell" and warned of further losses from
the company. Bloomberg reported in September 2008 that Merrill Lynch had lost
$51.8 billion in mortgage-backed securities as part of the subprime mortgage
On September 14, 2008, Bank of
America announced it was in talks to purchase Merrill Lynch for $38.25
billion in stock. The Wall Street Journal reported later that day that
Merrill Lynch was sold to Bank of America for 0.8595 shares of Bank of America
common stock for each Merrill Lynch common share, or about US$50 billion or $29