HOUSTON–Members of Space City Credit Union have voted in favor of a merger deal in which 57% of the net worth that will be distributed will go to three top executives.

As the CU Daily was first to report here, the $134-million Space City will merge into the nearly $5-billion Texas Dow Employees CU, with the organizations saying they plan to drop the “Credit Union” from the name and operate as Space City Financial.

Payouts to Senior Management

In the disclosure form filed with NCUA prior to the merger, Space City said it will pay a total of $6.75 million to three members of its management team: 

• CEO Craig B. Rhoden, who has been in the position since 1994, will be paid a $3.5 million lump sum plus a $500,000 lump sum payable by TDECU following closing under a transition and two-year non-compete agreement
• SVP/COO Nikki Moore-Owens, who has been with SCCU since 2008, who is to receive a lump sum payout from Space City of $1.9 million, a lump sum payout from TDECU under a transition, retention and two-year non-compete agreement of $350,000, and a $55,000 annual salary increase based on similarly situated employees at TDECU.
• VP Paula Newkirk, who has been with the credit union since 2007, who is to receive a lump sum payout from Space City of $500,000 and an annual salary increase based on similarly situated employees of TDECU of $100,751

Two other execs are also receiving smaller payouts.

Payouts to Members

Members are also receiving a payout, although it is less than that going to the management team. Space City said a $5 million member dividend will be distributed, with payouts to range between $100 and $1,000. It said balances between $289.27 and $2,892.69 will receive a dividend equal to 34.57% of their balance.

According to a statement on its website, Space City CU reported that of its 12,000 members, 82% of the votes that were cast were in favor of the merger (708), and 154 ballots were cast against (18%). 

The combined CU will have approximately 188,000 members.

‘Best in Class’

“As you know, we are committed to our hometown and growing our operations to better serve you,” Space City said in a statement on its website. “This strategic partnership allows us to answer your requests for enhanced scale and resources to deliver best-in-class products, technology upgrades and access to more physical locations. At the close of the merger, all Space City Credit Union branches and TDECU Member Centers in the Greater Houston area will rebrand as Space City Financial. TDECU’s current strategic partnerships will amplify the Space City Financial brand.”

Rebranding Sports Tie-Ins

TDECU has branding tie-ins with the University of Houston Stadium, the Houston Texans and Buc-ee’s locations across the Houston area. These partnerships will be rebranded to “Space City Financial,” the CU said.