SiliconBeat

When James Mayer became an executive vice president with Heritage Commerce after its 2007 acquisition of Diablo Valley Bank, where he served as president, his employment agreement called for him to receive a severance payment of $300,000 paid in equal installments over 18 months after his resignation.

Mayer, 67, who resigned on April 30, will have to wait to begin receiving his severance however. That’s because Heritage agreed to take a $40 million infusion of cash from the Treasury Department in November under the American Recovery and Reinvestment Act of 2009. The deal, which gave the U.S. government 40,000 shares of preferred Heritage stock paying a five percent dividend, also set limitations on executive compensation, including prohibitions on bonuses and severance payments.

And as part of the act, publicly held bank holding companies that received Federal funds agreed to give their shareholders an “advisory” vote on the compensation packages they offered to their executives at their next annual meeting. Heritage’s is set for May 28.

Mayer should be OK in the meantime. He earned about $230,000 last year and owned 46,253 shares of the bank’s holding company as of Feb. 15, which are currently worth about $340,000. And if he hasn’t already, Mayer is eligible for Social Security to help see him through.