Statement of Employment Conditions

Exhibit 10(bbb)

May 1, 2008

Thomas K. Montag

135 Central Park West, 11NC

New York, NY 10023

Dear Tom:

We are pleased to offer you the position of Head of Global Sales and Trading, reporting to John A. Thain, Chairman and CEO. In this capacity you will also be an Executive Vice President of Merrill Lynch. We anticipate and you agree that you will commence employment on August 4, 2008 (“the Start Date”).

The terms of our offer of employment are as follows:

1. COMPENSATION

a. Salary

Your starting salary will be at the annualized rate of $600,000.00 and will commence on the Start Date.

b. Incentive Compensation

You will be eligible to participate in the Merrill Lynch Variable Incentive Compensation Program (VICP). In general, VICP awards are granted annually at the sole discretion of management based upon individual performance, company financial results, and other criteria. However, for Performance Year 2008, you will receive a guaranteed VICP award of $39,400,000.00, provided you are in the continuous employment of Merrill Lynch through the scheduled payment date in early 2009 (“your Guaranteed VICP Award”). Your Guaranteed VICP Award may consist of cash or cash and equity, at the discretion of Merrill Lynch, but any portion of your Guaranteed VICP Award granted in equity will be at a percentage of your total compensation generally equivalent to the treatment given to similarly situated executives. Any equity portion of your Guaranteed VICP Award may consist of Merrill Lynch Restricted Units or other equity instruments subject to the vesting and other provisions of the applicable Merrill Lynch & Co., Inc. employee stock compensation plan (“the SCP”) and grant documents. Except as otherwise specifically provided in the applicable SCP and grant documents or in this letter, if your employment terminates for any reason or if you violate any of the terms and conditions of the grant prior to the vesting and/or distribution to you of your equity grant, your rights to the unvested and/or undistributed portion shall be terminated and such grants will be canceled. All

equity grants are subject to the approval of the Management Development and Compensation Committee of the Merrill Lynch & Co., Inc. Board of Directors (“the MDCC”).

Your performance will be reviewed periodically. Any future salary and other compensation, including any future awards under the VICP, will be based on a consideration of a number of factors, including, but not limited to, company financial results and your individual performance, and shall be determined in Merrill Lynch’s sole discretion.

To make you whole for the value of equity awards granted by your former employer that you will lose (including the time value of options you will exercise in advance of, or within thirty days of your Start Date, the time value of options you exercised in anticipation of your Acceptance Date, and the time value of options that are not exercisable as of the date of your written acceptance of this offer (“the Acceptance Date”)) in connection with your employment with Merrill Lynch (the “Forfeiture”) and subject to MDCC approval at its first regularly scheduled meeting following the Start Date, with respect to the equity grants described in this paragraph, Merrill Lynch will make cash payments and/or grants of equity to you, subject to our receiving reasonable written confirmation of a Forfeiture, in an aggregate amount to which we will agree (“the Replacement Value”). The Replacement Value will be divided in a manner to which we will agree into cash, Restricted Units, and stock options components (“the Cash Component,” “the Restricted Unit Component,” and “the Stock Option Component,” respectively).

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Should the MDCC fail to approve any or all of the Replacement Restricted Units and/or Replacement Stock Options, the value of the unapproved portion will be paid to you in cash no later than March 15, 2009.

3.      EFFECT OF THE TERMINATION OF YOUR EMPLOYMENT ON YOUR GUARANTEED VICP AWARD, ANY FUTURE EQUITY AND THE REPLACEMENT VALUE

For purposes of this letter, either the termination of your employment by Merrill Lynch without Cause or your resignation with Good Reason, each as defined below, shall be deemed a Qualifying Employment Termination.

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For all purposes of this letter (except for the terms of the payments and equity grants in satisfaction of the Replacement Value, including without limitation the Replacement Restricted Units and Replacement Stock Options), Cause shall mean: (i) any substantial violation of Merrill Lynch’s rules, regulations, policies, practices and/or procedures; (ii) any substantial violation of laws, rules or regulations of any governmental entity or regulatory or self-regulatory organization, applicable to Merrill Lynch; (iii) criminal, illegal, dishonest, immoral, or unethical conduct reasonably related to your employment; or (iv) a substantial breach of this letter or any of the accompanying attachments; provided, however, that the definition of “Cause” that applies to your VICP equity awards and any subsequent awards shall not include any action or event not included in any definition of “Cause” generally applicable to similarly situated executives of Merrill Lynch as in effect from time to time. With respect to (i) and (iv) above, Cause shall exist only after you are given notice and an opportunity to correct your conduct, unless such conduct or its consequences cannot be reasonably corrected.

For purposes of the terms of the payments and equity grants in satisfaction of the Replacement Value, including without limitation the Replacement Restricted Units and Replacement Stock Options, Cause shall mean: (i) your engagement in (A) willful misconduct resulting in material harm to Merrill Lynch or (B) gross negligence in connection with the performance of your duties; or (ii) your conviction of, or plea of nolo contendere to, a felony or any other crime involving fraud, financial misconduct or misappropriation of Company assets, or that would disqualify you from employment in the securities industry (other than a temporary disqualification).

For the purpose of this letter agreement, Good Reason shall mean: (i) a meaningful and detrimental alteration in the nature your responsibilities or authority, but only after you have notified Merrill Lynch in writing that you believe such an alteration has occurred and, within 30 days of our receipt of such notice, we have not been able to resolve the matter to our mutual satisfaction; (ii) your reporting to an executive other than the CEO of Merrill Lynch & Co., Inc. during the three year period commencing on the Start Date; or (iii) a material reduction in your total annual compensation (salary and VICP) that is not experienced generally by similarly situated employees of Merrill Lynch.

6.      TERMS RELATING TO YOUR VOLUNTARY RESIGNATION AFTER THE THIRD ANNIVERSARY OF YOUR START DATE

Subject to MDCC approval, the grants under the SCP of the equity portion of your Guaranteed VICP Award and any subsequent equity awards granted to you prior to your satisfying the

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service and age requirements generally applicable to Career Retirement treatment shall provide that you will be eligible for Career Retirement treatment with respect to such grants upon completing three years of service, without any other requirement relating to your age or service, but subject to all other requirements and conditions normally associated with Career Retirement treatment imposed by the SCP, the grant documents, and the Covenant Agreement attached hereto.

If following a Change in Control a Qualifying Employment Termination occurs, any equity awards granted to you (including, without limitation, any awards granted in satisfaction of Replacement Value or your Guaranteed VICP Award or any subsequent awards) will immediately vest in full, be delivered to you and become and remain exercisable for the full original term, as the case may be, and shall not be subject to any forfeiture provisions or covenants; provided that, in the event that Merrill Lynch is not a surviving company in the Change in Control transaction, your right to receive securities will be converted, based on the terms of the change in control transaction, to securities of the acquiring entity.

The preceding sentence shall apply to your equity awards, notwithstanding any provisions in the applicable SCP or award agreement governing the treatment of equity awards in the event of a termination of employment without Cause or for Good Reason following a Change in Control. For the avoidance of doubt, Section 8.1 of the Merrill Lynch & Co., Inc. Long-Term Incentive Compensation Plan, and any similar provision contained in the applicable SCP, shall not apply to equity awards granted to you.

In no event shall you be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to you under any of the provisions of this letter agreement and, such amounts shall not be reduced whether or not you obtain other employment, except where such employment violates a condition of payment.

On or prior to the Start Date, you agree to enter into Merrill Lynch’s standard covenant agreement for executives, a copy of which is attached hereto.

During and after your employment, Merrill Lynch shall indemnify and defend you with respect to claims relating to your employment to the fullest extent permitted under applicable law and Merrill Lynch’s Certificate of Incorporation.

Notwithstanding anything herein to the contrary, if any payments of money or other benefits due to you hereunder would cause the application of an accelerated or additional tax under Section 409A of the Internal Revenue Code of 1986, as amended, such payment or other benefits shall be

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deferred if deferral will make such payment or other benefits compliant under Section 409A of the Code, or otherwise such payment or other benefits shall be restructured in a manner that does not cause such an accelerated or additional tax.

Merrill Lynch will reimburse you for your actual attorney and consultant fees incurred in the finalization of this letter agreement, up to $25,000.00.

You must also be able to satisfy the requirements of the Immigration Reform and Control Act of 1986, which requires documents to prove your identity and demonstrate that you are authorized to work in the U.S., and to complete an Employment Eligibility Verification form (Form I-9).

A further condition of this offer and your employment with Merrill Lynch is that you have not been convicted of a felony or certain misdemeanors which would disqualify you from employment with Merrill Lynch under federal securities law and under the rules of the Financial Industry Regulatory Authority. (These preconditions are referenced in the Merrill Lynch Statement of Employment Conditions and the Merrill Lynch Policy on Statutory Disqualification.)

Prior to your start date with Merrill Lynch, you are required to complete pre-employment screenings, which includes substance abuse screening and Form I-9 verification. The Employee Service Center will assist you in scheduling these appointments. In addition, you must review Merrill Lynch policies and guidelines and submit a series of forms that provide required personal information. You will be receiving an email from our Employment Service Center instructing you on how to proceed with this process. If you have any questions in the interim, or you do not receive this email, please contact me.

You should also carefully review the attached Statement of Employment Conditions as this offer and your employment with Merrill Lynch are subject to them. In the event of a conflict between the Statement of Employment Conditions and this letter agreement, this letter agreement shall control.

Until this letter is filed with the SEC, you agree to keep this letter and its terms strictly confidential and not to disclose them to any person or entity except your attorney, financial advisor, and immediate family members, as long as such individuals agree that they are subject to this confidentiality provision. Nothing in this letter shall prohibit or restrict you from providing information pursuant to legal process.

This offer is contingent upon the approval of the MDCC. Once that approval is obtained, Merrill Lynch represents and warrants that it is fully authorized and empowered to enter into this Agreement and to perform its obligations thereunder. Any notice to you that is required under, or which concerns this Agreement shall be sent to you at your most recent address on file, and to your counsel:

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Steven Eckhaus, Esq.

McCarter & English, LLP

245 Park Avenue

New York, NY 10167

***@***

This Agreement may be executed in counterparts, including by fax or PDF, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

In the event of a conflict between this letter and any other document, this letter shall control.

Tom, it goes without saying that we believe you can make a significant contribution to Merrill Lynch, and we look forward to your joining us.

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Acceptance of offer

My signature below confirms acceptance of the offer of employment and my understanding of the terms and conditions associated with it. This signature also confirms that there are no oral promises associated with this offer that are not reflected in this letter and I am not relying on any such promises or understandings in accepting this offer. In signing this letter, I further acknowledge that I have received, read, and agree to all pre-employment conditions and policies referred to in this letter, specifically the enclosed Statement of Employment Conditions and Policy on Statutory Disqualification.

Enclosed:

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Statement of Employment Conditions

All offers and/or contracts of employment by Merrill Lynch & Co., Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated or any of their subsidiaries, or affiliates, (“Merrill Lynch”) are subject to the following conditions:

1.        Unless otherwise expressly and specifically agreed to in writing and signed by an authorized officer of Merrill Lynch, all employment is terminable at will by either party. Written descriptions of compensation to be paid or benefits offered, including those in an employment offer letter, do not alter the at will employment status of any employee.

2.        Where applicable, all job offerees must provide documentary evidence of their right to work in the country where their position is located prior to beginning employment. In the U.S., the job offeree must provide documents necessary to meet the terms of the Immigration Reform and Control Act of 1986, which requires that the job offeree provide documents that prove his/her identity and demonstrate that he/she is authorized to work in the U.S.

3.        Employment at Merrill Lynch is subject to pre-employment screening requirements, the results of which must be acceptable to Merrill Lynch. These requirements consist of reference and background checks, including fingerprinting and criminal background searches, and, depending on job offeree’s work location, may include substance abuse screening.

4.        All job offerees and employees are subject to federal securities laws and the rules of the Financial Industry Regulatory Authority (“FINRA”) that prohibit persons who are subject to “statutory disqualification” from being employed by Merrill Lynch. The job offeree must not have been convicted of a felony or certain misdemeanors that would disqualify him/her from employment with Merrill Lynch under federal securities law and under FINRA rules.

5.        Unless otherwise expressly and specifically agreed to in writing, and signed by an authorized officer of Merrill Lynch, all compensation levels are within Merrill Lynch’s sole discretion and may be modified at any time.

6.        Unless otherwise expressly and specifically agreed to in writing, no compensation, either cash payments or equity awards, will be paid or awarded unless the employee is in the continuous employment of Merrill Lynch through the date of payment, except for amounts of base salary earned prior to termination and any unused, accrued vacation as required by state law. Continued employment with Merrill Lynch until the payment or award date is a pre-condition to any compensation payment or equity award, including any bonus, and no pro-rata payment or award will be due if employment terminates prior to the payment or award date.

7.        All officer titles in Merrill Lynch or any of its subsidiaries (e.g., Vice President) are subject to formal approval by the appropriate governing body.

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8.        All non-public information concerning Merrill Lynch is its property, will be held in confidence by the employee, and will be used only for Merrill Lynch’s, or the clients’ benefit.

9.        Any inventions, together with non-public information of its clients, and copyrightable material developed by the employee in the scope of their employment will be promptly disclosed to Merrill Lynch and will be “works for hire” owned by Merrill Lynch, and the employee will, at Merrill Lynch’s expense, do whatever is necessary to transfer to Merrill Lynch, or document its ownership of, any such property.

10.      Events giving rise to reports required to be filed with regulatory organizations such as the Securities and Exchange Commission, FINRA, and any other regulatory organization in the U.S. or abroad must be reported promptly to your manager and where appropriate to the Firm’s Compliance Department or Corporate Security. These events include but are not limited to employee arrests, indictments and convictions, misappropriations by employees, the receipt of written customer complaints, and litigation matters involving customers of Merrill Lynch.

11.      Employees may not open or maintain securities accounts at other broker dealers. This policy extends to accounts in which the employee has a financial interest or has the power, directly or indirectly, to make investment decisions, including accounts of spouses and dependent children. Exceptions are rarely granted and require the written pre-approval of the employee’s manager and the Firm’s Compliance Department.

12.      Employees are expected to adhere to ethical standards of business conduct including those described in Merrill Lynch’s Guidelines for Business Conduct, its Guidelines for Electronic Communications, and its A Matter of Respect. Failure to do so can result in disciplinary action, including termination of employment.

These conditions of employment may be modified only in writing by the Executive Vice President for the business unit.

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Policy on Statutory Disqualification

The federal securities acts and the Financial Industry Regulatory Authority rules prohibit persons who are subject to “statutory disqualification” from being employed by or associated with any member of a self-regulatory organization including brokerage firms. A person is subject to statutory disqualification if, within the previous ten year period, he or she has been convicted of, or pled guilty or no contest to, any felony, regardless of the crime. Thus, persons convicted of a felony involving the possession or use of drugs, domestic violence, assault, etc. are subject to this prohibition, regardless of whether the offense related in any way to a financial institution, securities or financial transaction. In addition, the prohibition extends to any misdemeanor involving:

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THIS AGREEMENT, dated                         , 2008 (the “Effective Date”) (the “Covenant Agreement”), by and between Merrill Lynch & Co., Inc., a Delaware corporation (the “Company” or “Merrill Lynch”), and Thomas K. Montag (the “Executive”).

WHEREAS, the Company has entered into an agreement with the Executive, dated March         , 2008 (the “Agreement”), detailing the terms and conditions of his employment with the Company, pursuant to which the Company has agreed to pay certain amounts and grant certain equity awards, and the Executive has agreed to enter into this Covenant Agreement with the Company;

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth in this Covenant Agreement, the parties agree as follows:

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The Executive agrees not to disclose the terms of this Covenant Agreement or the circumstances of his or her termination to any other party, except that the Executive may make such disclosure: on a confidential basis to his or her tax, financial and legal advisors, his or her immediate family members, any prospective employer or business partner, provided that, in each case, such third party agrees to keep the circumstances of the Executive’s termination and the terms of this Covenant Agreement confidential.

The Executive agrees that the covenants contained in paragraphs A-G of this Section 1 are reasonable and necessary to protect the legitimate business interests and goodwill of the Group Companies and that agreeing to comply with such restrictions was an inducement for the Company to agree to enter into the Agreement with the Executive. To the extent that any of the covenants contained in paragraphs A-G of this Section 1 or any other provision of this agreement shall be deemed illegal or unenforceable by a court or other tribunal of competent jurisdiction with respect to (i) any geographic area, (ii) any part of the time period, (iii) any activity or capacity covered by such covenant, or (iv) any other term or provision of such covenant, the covenant shall be construed to the maximum breadth determined to be legal and enforceable and the illegality or unenforceability of any one covenant shall not effect the legality and enforceability of the other covenants.

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SIGNATURE PAGE FOLLOWS

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IN WITNESS WHEREOF, the parties hereto have executed this Covenant Agreement as of the day and year indicated below.

Summary of Agreement with respect to Post-Employment Medical Coverage

Should your employment terminate without your attaining eligibility for coverage under Merrill Lynch’s then-current retiree medical plan, and the termination of your employment is not for Cause, Merrill Lynch will provide access to a plan or policy that will provide coverage that is identical to or better than the coverage provided under the then-current retiree medical plan at a premium cost to you that is no more than the premium paid by eligible employees paying a premium unsubsidized by Merrill Lynch, on the condition that you do not engage in any employment, accept or maintain any directorship or other position, own an interest in, or, as principal, agent, employee, consultant or otherwise, provide any services to anyone, whether or not for compensation, in any business that is engaged in competition with the business of Merrill Lynch or its affiliates.