If shareholders in January approve the acquisition of First Commons Bank by Brookline Bancorp, executives are slated to receive some significant payouts.
According to a recent regulatory filing, under the terms of the severance agreement, First Commons Bank Chairman, President and CEO Anthony Nuzzo will receive a lump sum cash payment of $897,000, roughly three times his salary. Nuzzo will also be entitled to receive reimbursement for the three-year period following the closing of the merger of 80 percent of the cost of his hospital, health and medical insurance coverage (including Medicare), up to a maximum of $46,000.
In addition, upon closing of the merger, Nuzzo will receive a one-time bonus of $37,500.
In connection with the merger Brookline Bank has also entered into a consulting agreement with Nuzzo for the one-year period following the closing of the merger for $150,000.
First Commons Bank’s CFO Michael Tallo will receive a lump sum cash payment of $303,750, representing 1.5 times his current base salary.
Charles Shediac, senior vice president and chief loan officer at First Commons, will receive a lump sum cash payment of $202,500, while Karen Cohn, senior vice president and chief loan officer, will receive $170,000. Both of these amounts are equal to the salaries that Shediac and Cohn receive in their current jobs.
However, because Shediac and Cohn are staying on as employees at Brookline Bank, they will be eligible for retention bonuses. Through the first and second anniversaries of the closing of the merger, Shediac and Cohn will be entitled to receive a lump sum cash bonus payment in the amount of $50,000 on each such anniversary.
Brookline and First Commons Bank first announced the deal in September for a transactional value of roughly $56 million. It was Brookline’s first acquisition since the $6.7 billion asset bank’s $82 million stock offering earlier in the year.
Under the agreement, Brookline will pay $16.70 per share, or $52.5 million in Brookline stock, for the outstanding shares and warrants of First Commons Bank, as well as $3.4 million in cash for the outstanding options.
Brookline has the option to pay up to 50 percent of the consideration for the outstanding shares in cash.
First Commons Bank, which does not trade on a public exchange, first launched in 2009 as a nationally chartered bank after raising $18 million. The company has one branch in Newton and one in Wellesley, both markets Brookline Bank is very familiar with.
“We are very pleased to welcome the customers of First Commons Bank to Brookline Bank, and we look forward to getting to know its employees,” Paul Perrault, president and CEO of Brookline Bank, said in a statement following the deal. “This combination leverages our unique talents and efforts within greater Boston and strengthens our position in the marketplace.”
