8-KLeadership Changes

COGNIZANT TECHNOLOGY SOLUTIONS CORP 8-K Report, Executive Changes (Apr 12, 2016)

Filed April 12, 2016For Securities:CTSH

Summary

Cognizant Technology Solutions Corp. (CTSH) announced a significant addition to its Board of Directors with the appointment of Jonathan Chadwick, effective April 9, 2016. Mr. Chadwick brings extensive financial leadership experience, having previously served as Executive Vice President, Chief Financial Officer, and Chief Operating Officer at VMware, Inc. His background also includes senior financial roles at Skype and Microsoft, as well as a long tenure in various financial positions at Cisco Systems, Inc. This appointment is investor-focused as Mr. Chadwick has also been designated as an "audit committee financial expert" and will serve on the Board's Audit Committee, enhancing the company's corporate governance and financial oversight capabilities. Mr. Chadwick's appointment fills a newly created vacancy and he will serve until the 2016 Annual Meeting of Stockholders. He has been deemed independent under NASDAQ and SEC rules. His compensation for board service will align with the company's standard guidelines for non-employee directors, including a grant of 258 restricted stock units vesting over three years and stock options to purchase 998 shares, with vesting over two years. This move signals a commitment to strengthening the board's expertise, particularly in financial matters, which is a positive indicator for shareholders concerned with financial reporting and oversight.

Key Highlights

  • 1Appointment of Jonathan Chadwick as a Class I Director to the Board, effective April 9, 2016.
  • 2Mr. Chadwick has been appointed to the Board's Audit Committee and designated as an "audit committee financial expert".
  • 3Mr. Chadwick brings substantial financial experience, including prior roles as CFO and COO at VMware, and finance leadership at Skype and Microsoft.
  • 4The appointment fills a newly created vacancy on the Board.
  • 5Mr. Chadwick has been determined to be independent under applicable NASDAQ and SEC rules.
  • 6Compensation for Mr. Chadwick includes restricted stock units vesting over three years and stock options vesting over two years.
  • 7The total equity grant includes 258 restricted stock units and options for 998 shares.

Frequently Asked Questions

Jonathan Chadwick is a seasoned financial executive with extensive experience, including his most recent role as EVP, CFO, and COO of VMware, Inc. He has also held senior financial positions at Skype, Microsoft, McAfee, and Cisco Systems. He has been appointed to Cognizant's Board of Directors to fill a newly created vacancy and enhance the board's expertise, particularly in financial matters, as he has been designated an "audit committee financial expert."

An "audit committee financial expert" designation signifies that Mr. Chadwick possesses a deep understanding of accounting principles and financial reporting. This is crucial for the effectiveness of the Audit Committee, which oversees the company's financial statements, internal controls, and external auditors. For investors, this designation enhances confidence in the company's financial integrity and oversight.

Mr. Chadwick will receive compensation consistent with the company's guidelines for non-employee directors. This includes a grant of 258 restricted stock units, which will vest ratably over three years, and stock options to purchase 998 shares of Class A Common Stock with an exercise price of $60.16 per share. The stock options will vest in two equal annual installments over two years.

Yes, the Board of Directors has determined that Mr. Chadwick has no relationships, direct or indirect, with the Company that would be inconsistent with a determination of independence under the applicable rules and regulations of The NASDAQ Stock Market and the United States Securities and Exchange Commission. This independence is important for effective board oversight.