Here’s what First Horizon execs could get in ‘golden parachute’ payments
They could receive millions in merger with Toronto-based TD Bank Group
First Horizon Corp.’s top executives could receive multi-million dollar “golden parachute” payouts as a result of the merger with Toronto-based TD Bank Group.
That’s according to a proxy statement filed with the U.S. Securities and Exchange Commission on April 22. This comes after TD Bank Group announced in February an agreement to acquire Memphis-based First Horizon in a $13.4 billion all-cash transaction.
The proxy statement also revealed First Horizon plans to hold a special shareholders meeting to vote on the potential merger at 10:30 a.m. May 31 at 165 Madison Ave., its Downtown headquarters.
A golden parachute typically refers to compensation or benefits guaranteed to company executives upon termination following a merger or takeover. First Horizon shareholders would hold a nonbinding advisory vote on the compensation package before it moves forward.
The First Horizon executives listed in the golden parachute compensation statement include President and CEO Bryan Jordan ($41.5 million), senior executive president and Chief Financial Officer Hope Dmuchowski ($4.6 million) and current executive and board chairman Daryl G. Byrd ($25 million).
The golden parachute payments include cash, equity and benefits. The executives listed in the proxy statement are eligible for these payments through their change in control agreements if a merger or acquisition like TD Bank Group occurs.
Others listed in the proxy statement include Anthony J. Restel ($10.2 million), president of regional banking; David T. Popwell ($11 million), president of specialty banking; and Michael J. Brown ($2.9 million), former president of regional banking.
The proxy statement describes a situation where under the terms of the executives’ change in control agreements, they could experience termination by First Horizon without “cause.” In the scenario referenced in the proxy statement, the terminations would occur on Nov. 1, and trigger the payments.
What triggers the golden parachute payments varies by First Horizon executive and other factors. In the change in control agreements for Jordan and Popwell, for example, the lump sum cash severance payments are equal to three times the sum of the executive officer’s highest annual rate of base salary in the 12 months prior to the termination date plus part of their annual bonus.
Once the merger occurs, Jordan is expected to join TD Bank Group as vice chair. The transaction is expected to close by the first quarter of TD’S 2023 fiscal year, which could be in November.
TD Bank Group has no planned closures of First Horizon banking centers in connection with the transaction, as of now. All First Horizon frontline bankers are also being retained through the merger, according to a First Horizon spokesperson.
Omer Yusuf covers the Ford project in Haywood County, residential real estate, tourism and banking for The Commercial Appeal. He can be reached via email Omer.yusuf@commercialappeal.com or followed on Twitter @Omerayusuf.