JPMorgan chase might be buying Bear Stearns' stock at a fire sale price, but the company might have to pony up a bit more to keep its MBS traders. Last week Paul Van Lingen and Scott Eichel, both senior managing directors, and Joseph Steffa all accepted offers at RBS Greenwich Capital, according to people familiar with the situation. RBS is trying to replenish its MBS trading operations after a stream of traders left the company last month for various firms, including Jefferies & Co. JPMorgan wants to hold onto as many Bear Stearns staff as possible, especially because the latter has extensive sales contacts for esoteric and agency CMO products, said people familiar with both companies. Keeping Bear traders would make it easier to retain those accounts.

According to an S-4 Securities and Exchange Commission filing dated April 23, JPMorgan Chase has made an oral agreement with Jeffrey Mayer, executive vice president and senior managing director at Bear Stearns, to employ him upon the completion of the merger of the two investment banks. At JPMorgan, Mayer will serve as a vice chairman focusing on global markets. Mayer will receive an annual salary of $250,000 plus a bonus compensation of $12 million for 2008, payable in a mix of cash and restricted stock units, said the SEC filing. Mayer will also get a grant of restricted stock equal to $15 million, which will vest 50% on or about each of the second and third anniversaries of the grant date as well as the shares of JPMorgan Chase common stock that will be distributed upon vesting. Mayer is still in discussions with JPMorgan Chase regarding the terms of his employment, according to the SEC filing.

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