"The sale of the Securities has no effect on the terms of the outstanding Securities, including the Company’s obligation to satisfy accrued and unpaid dividends prior to payment of any dividend or other distribution to holders of junior stock, including the Company’s common stock, and an increase in the dividend rate from 5% to 9%, effective December 15, 2013 and commencing with the dividend payment on February 15, 2014. Further, the sale of the Securities will have no effect on the Company’s capital, regulatory capital, financial condition or results of operations. Upon the closing of the sale of the Securities, the Company generally will not be subject to various executive compensation and corporate governance requirements to which participants in Treasury’s Capital Purchase Program were subject while Treasury held the Securities."
The amount of the preferred shares is $180 million. So up until now, annual dividends on the preferred was $9 million/year. That will be increasing to $16.2 million/year. Looking at the income statement and taking that increase of $7.2 million to the bottom line, it will knock off 12.5 cents/share/year from annual earnings.
Also, is there concern that once the sale takes place, that executive compensation is going to increase as well?