Gary Collins
About Gary Collins
Gary Collins, age 66, is Vice Chairman of Old Second Bancorp and a Class III director who has served on the board since 2016; his current employment agreement runs through July 1, 2027 and transitioned him from direct business-line management to strategic objectives in mid-2024 . Collins’ pay is tied to company and departmental performance: annual cash incentives weight Adjusted Net Income growth and asset quality, while long-term PRSUs vest on relative ROTCE and relative book value per share versus a 111‑bank peer set; the Compensation Committee identified Adjusted Net Income as the most important performance measure linking pay to “compensation actually paid” in 2024 . OSBC prohibits hedging and pledging, maintains clawbacks under SEC/NASDAQ rules, and uses double-trigger change-in-control protections—factors that reinforce alignment and mitigate risk .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Talmer Bancorp, Inc. | Vice Chairman; Director | 2010–2016 | Executive leadership at a public bank holding company; mortgage banking and real estate lending expertise |
| Lake Shore Wisconsin Corporation | Chairman and Co-CEO | 2010–2011 | Led bank holding company; governance and operating oversight |
| The PrivateBank — Chicago | Founding Managing Director; Vice Chairman | 1991–2009 | Built franchise in mortgage/real estate; credit/lending leadership |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Talmer Bancorp, Inc. | Director | 2010–2016 | Board oversight at a public bank; sector network and M&A exposure |
No current public-company directorships disclosed in the proxy excerpts for Collins beyond OSBC .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 371,718 | 391,487 | 347,006 |
| Stock Awards ($, grant-date fair value) | 252,037 | 284,157 | 228,084 |
| Non-Equity Incentive Plan Compensation ($) | 180,905 | 135,934 | 164,358 |
| All Other Compensation ($) | 44,101 | 59,923 | 64,575 |
| Total Compensation ($) | 848,761 | 871,501 | 804,023 |
| 2024 Perquisites (All Other Comp detail) | Amount ($) |
|---|---|
| 401(k) match | 13,800 |
| Life insurance | 505 |
| Car allowance | 7,800 |
| Country/Social club dues | 25,962 |
| TRSU dividend equivalents | 15,788 |
| Cell phone reimbursement | 720 |
| Total | 64,575 |
| Base Salary Change | 2023 | 2024 | Change (%) |
|---|---|---|---|
| Gary Collins | 394,012 | 300,000 | (23.9%) |
Employment agreement initially set salary at $394,012, then adjusted to $300,000 on July 1, 2024 to reflect role change and address underperformance in Residential Banking .
Performance Compensation
| Annual Cash Incentive (2024) | Target % of Salary | Target ($) | Actual Award ($) | Payment Achieved (%) |
|---|---|---|---|---|
| Gary Collins | 50% | 150,000 | 164,358 | 109.6% |
| 2024 Annual Incentive Metrics (Collins) | Weighting (%) |
|---|---|
| Adjusted Net Income Growth | 30 |
| Asset/Credit Quality | 10 |
| Efficiency Ratio | — (not used) |
| Department/Personal Performance | 10 |
| 2024 Equity Grants (awarded 3/20/2024) | Units (#) | Grant-Date Fair Value ($) | Vesting |
|---|---|---|---|
| TRSUs | 8,246 | 114,042 | Cliff vest on 3rd anniversary of grant |
| PRSUs (2024–2026 cycle) | 8,246 | 114,042 (at target) | Vests based on performance vs peer; 3-year period |
| PRSU Max Grant-Date Value | — | 199,574 (if max performance) | Performance contingent |
| PRSU Performance Metrics (2024–2026) | Measurement |
|---|---|
| Relative Return on Average Tangible Common Equity | Ranked vs 111-bank peer group |
| Growth in Relative Book Value per Share | Ranked vs 111-bank peer group |
Equity grants are structured as TRSUs and PRSUs; no stock options or SARs were granted in 2024, and no options were exercised by NEOs in 2024 .
Equity Ownership & Alignment
| Beneficial Ownership (as of 3/21/2025) | Shares | % of Class | Composition | Excluded Unvested RSUs (#) |
|---|---|---|---|---|
| Gary Collins | 131,470 | <1% (*) | Brokerage (46,624), IRA (61,768), Outright (16,488), 401(k) (6,590) | 44,946 |
| Outstanding Unvested Awards (12/31/2024) | Units (#) | Market Value ($) | Notes |
|---|---|---|---|
| TRSUs | 25,165 | 447,434 (at $17.78) | 8,673 vest 2/15/2025; 8,246 vest 2/21/2026; 8,246 vest 2/20/2027 |
| PRSUs | 31,672 | 563,128 (at $17.78) | Subject to performance; 2022 PRSUs earned at 175% and paid 3/4/2025 |
| Stock Vested in 2024 | Shares Acquired on Vesting (#) | Value Realized ($) |
|---|---|---|
| Gary Collins | 26,540 | 357,653 |
| Deferred Compensation (Executive Plan, 2024) | Executive Contributions ($) | Aggregate Gains/Losses ($) | Balance at FYE ($) |
|---|---|---|---|
| Gary Collins | 45,227 | 68,515 | 401,048 |
- Hedging and pledging: Company policy prohibits hedging and pledging or margin use of OSBC securities; no pledging is disclosed for Collins .
- Ownership guidelines: 3x salary for CEO and 3x annual retainer for non-employee directors; holding requirement of 50% of net after-tax shares until guidelines are met. Officer-specific guidelines beyond CEO are not detailed in the excerpts; CEO currently in compliance .
Employment Terms
| Item | Details |
|---|---|
| Current Role & Transition | Vice Chairman; transitioned by 6/30/2024 to focus on strategic objectives; reports to CEO |
| Employment Agreement Date/Term | Executed 3/20/2024; effective through 7/1/2027 |
| Base Salary | Initially $394,012; adjusted to $300,000 on 7/1/2024 |
| Target Bonus | 50% of base salary under annual incentive plan |
| Non-CIC Severance (Qualifying Termination) | Lump-sum: accrued pay + 1x base (≥$300,000) + pro‑rata target bonus; immediate vesting of time-based awards; PRSUs vest pro‑rata at target based on months elapsed; up to 12 months health coverage at active-employee cost |
| Conditions | Confidentiality/non‑disclosure/non‑interference/non‑solicitation for 12 months; resignation of officer/board positions; general release; CBAA protective period ends no later than 7/1/2027 |
| Change-in-Control (CBAA; Double Trigger) | If terminated without cause within 6 months prior to or 24 months post-CIC, or for good reason within 24 months post-CIC: 2x base (greater of at termination or pre‑CIC) + average bonus (last 3 years), immediate 100% vesting of equity awards, 24 months health continuation, up to $20,000 outplacement |
| CIC Definitions & Plan Treatment | Plan accelerates vesting if awards not assumed or if terminated w/o cause/for good reason post-CIC; performance awards vest per attainment threshold rules; CIC generally at ≥33% voting power acquisition, board turnover, merger/liquidation thresholds |
| Potential Payments (Assuming 12/31/2024) | Involuntary Termination (No CIC) Total: $187,709 (pro‑rata PRSUs) ; Involuntary Termination (CIC) Total: $1,809,042 (Cash $760,399, Insurance $18,081, TRSU accel $447,434, PRSU accel $563,128, Outplacement $20,000) ; Retirement/Death/Disability Total: $635,143 |
| Clawback | Incentive Compensation Recovery Policy effective 8/15/2023; recovery on “Big R” and “little r” restatements; board discretion to clawback beyond restatement triggers |
| Tax Gross-ups | Company practice: no excise tax gross-ups under change-in-control provisions; prior consultant conflicts addressed; Gartelmann gross-up removed in 2021 amendment |
Board Governance
- Board Service: Class III director nominee (2025), served as Director since 2016; age 66 .
- Committees: Capital Committee; Vice Chair of Executive Committee; Information Technology Steering Committee; Loan Committee; Risk and Insurance Committee .
- Dual-role implications: Collins is a management executive (Vice Chairman) and director; dual role may impact independence considerations typical for employee-directors; independence status not specified in these excerpts .
- Compensation Committee: Members include Hugh McLean (Chair), Dennis Klaeser, Barry Finn, Keith Kotche, John Ladowicz, Jill York; engages independent compensation consultant; emphasizes pay-for-performance, double-trigger CIC, stock ownership guidelines, and no hedging/pledging .
Compensation Structure Analysis
- Mix shift and risk: Equity awards are entirely RSUs (TRSUs/PRSUs); no options/SARs granted in 2024—reduces leverage but increases guaranteed elements via time-based RSUs; dividend equivalents paid on TRSUs but performance awards pay only when earned .
- Pay-for-performance alignment: Annual incentives linked to Adjusted Net Income and credit quality; PRSUs hinge on relative ROTCE and book value per share; 2024 Collins cash incentive paid at 109.6% of target ($164,358), indicating above-threshold performance .
- Role change impact: 2024 base salary reset to $300,000 and duty scope altered to strategic objectives due to Residential Banking underperformance—tightens fixed pay and emphasizes variable/long-term alignment .
- Shareholder feedback: 2024 say‑on‑pay received ~88% support; committee maintained policy structure emphasizing performance and risk controls .
Investment Implications
- Alignment and retention: Double-trigger CIC with 2x cash and full equity acceleration, plus non‑CIC severance with immediate vesting of time-based awards and pro‑rata PRSUs at target, offer meaningful downside protection; 12‑month post‑termination restrictive covenants and clawbacks mitigate moral hazard .
- Near-term selling pressure: Significant TRSU cliffs of 8,673 on 2/15/2025, 8,246 on 2/21/2026, and 8,246 on 2/20/2027 may create periodic supply; 2022 PRSUs paid on 3/4/2025, adding liquidity events; monitor 10b5‑1 plans and blackout windows .
- Ownership and risk controls: Beneficial ownership of 131,470 shares (<1%) with no pledging permitted under policy; strong anti-hedging/pledging stance reduces misalignment risk .
- Performance sensitivity: Incentives tied to Adjusted Net Income and credit quality can introduce cyclicality in compensation outcomes relative to credit cycles; PRSU peer-relative metrics reinforce competitive positioning but may increase payout variability .
- Governance quality: Independent consultant, double-trigger CIC, clawbacks, and option repricing prohibition support investor-friendly practices; continued oversight warranted given dual executive/director role .