8-KLeadership Changes

FIRST CITIZENS BANCSHARES INC /DE/ 8-K Report, Executive Changes (Feb 7, 2008)

Filed February 7, 2008For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

This 8-K filing from First Citizens BancShares, Inc. (FCNCA) reports on the departure of its Vice Chairman and Chief Operating Officer, James B. Hyler, Jr., effective January 25, 2008. The filing details a Retirement Agreement and Release entered into on February 1, 2008, outlining the terms of Mr. Hyler's separation from the company and its subsidiaries. Key aspects of the agreement include financial compensation, continued benefits, and restrictive covenants. Investors should note the financial implications of this retirement, including severance payments, continued insurance coverage, and a deferred compensation arrangement. The agreement also includes provisions for Mr. Hyler to retain company-provided electronic equipment and for his legal expenses to be covered. The departure and associated financial arrangements are the primary focus of this report.

Key Highlights

  • 1Vice Chairman and Chief Operating Officer, James B. Hyler, Jr., retired on January 25, 2008.
  • 2A Retirement Agreement and Release was executed on February 1, 2008, formalizing the terms of Mr. Hyler's departure.
  • 3Mr. Hyler will receive compensation equivalent to one month's base salary plus unused paid time off, totaling $150,621.
  • 4The company will cover the cost of continued insurance for Mr. Hyler and his beneficiaries for seven months, amounting to $10,761.
  • 5A significant component of the agreement is a payment of $600,000 per year for five years, in exchange for Mr. Hyler adhering to restrictive covenants.
  • 6These covenants include non-competition, non-solicitation of customers and employees, and confidentiality agreements.
  • 7An existing consultation, separation from service, and death benefit agreement from September 17, 2007, was amended to defer payments to March 1, 2013, and remove the requirement for future consulting services.

Frequently Asked Questions

This 8-K filing is primarily to report the retirement of James B. Hyler, Jr., the Vice Chairman and Chief Operating Officer, and to detail the terms of his separation agreement with First Citizens BancShares, Inc. and its subsidiary, First-Citizens Bank & Trust Company.

Mr. Hyler will receive an immediate payment of $150,621, representing one month's base salary plus unused paid time off. Additionally, he will receive $600,000 annually for five years, and amended payments from a prior agreement totaling $343,827 annually for ten years, starting March 1, 2013.

Yes, the Retirement Agreement includes covenants such as restrictions on engaging in competitive activities, soliciting customers or employees of First Citizens BancShares or its subsidiaries, and disclosing confidential information. These restrictions are in exchange for a portion of his compensation.

The agreement includes continued insurance coverage for Mr. Hyler and his beneficiaries for seven months, the transfer of ownership of certain electronic equipment from his home, payment of his legal expenses related to the agreement, and retention of all vested retiree benefits under the company's retirement plans.