8-KLeadership ChangesMaterial AgreementsExhibits & Filings

FISERV INC 8-K Report, Material Agreement (Nov 7, 2005)

Filed November 7, 2005For Securities:FISV

Summary

This Form 8-K filing by Fiserv, Inc. announces significant executive leadership changes and related agreements. Effective December 1, 2005, Jeffery W. Yabuki will assume the roles of President and Chief Executive Officer, succeeding Leslie M. Muma. Mr. Muma will transition to a consulting role until June 30, 2006, and will continue as a director until the 2006 annual meeting. The filing details the employment and severance agreements for Mr. Yabuki, including his compensation package, which features a base salary of at least $840,000, a target bonus of 100% of base salary, substantial equity grants (stock options and restricted stock), and relocation assistance. The agreements also outline terms for termination, including provisions for "good reason" and "cause," as well as change-in-control scenarios, with significant severance and potential excise tax gross-ups. Additionally, Norman J. Balthasar, Senior Executive Vice President and Chief Operating Officer, will transition to an advisory or COO role until June 30, 2008, under a retention agreement, following his eventual retirement. These changes signal a transition in leadership at Fiserv. Investors should focus on Mr. Yabuki's background and the terms of his appointment, as well as the retention strategies for key executives like Mr. Muma and Mr. Balthasar, to understand the company's go-forward strategy and executive compensation philosophy.

Key Highlights

  • 1Jeffery W. Yabuki appointed President and Chief Executive Officer, effective December 1, 2005.
  • 2Leslie M. Muma retiring as CEO but will serve as a consultant until June 30, 2006, and remain a director.
  • 3Norman J. Balthasar, COO, will transition to an advisory or COO role until June 30, 2008, under a retention agreement.
  • 4Jeffery W. Yabuki's employment agreement includes a base salary of at least $840,000 and a target bonus of 100% of base salary.
  • 5Substantial equity awards, including stock options and restricted stock, are granted to Mr. Yabuki.
  • 6Comprehensive severance packages are outlined for Mr. Yabuki, including provisions for termination without cause, good reason, and change-in-control events.
  • 7Retention agreements are in place for Leslie M. Muma and Norman J. Balthasar, outlining their roles and compensation post-retirement/transition.

Frequently Asked Questions

Jeffery W. Yabuki has been appointed as the new President and Chief Executive Officer, effective December 1, 2005. He is 45 years old and previously served as Executive Vice President and Chief Operating Officer of H&R Block, Inc., where he held various leadership roles including President of H&R Block International.

Mr. Yabuki's agreement includes an annual salary of at least $840,000, a target bonus of 100% of his base salary starting in 2006, a pro rata bonus for Q4 2005, and significant equity awards (stock options and restricted stock). He will also receive relocation assistance and participate in standard executive benefits. The agreement also specifies severance benefits in cases of termination without cause, for good reason, or following a change in control.

Leslie M. Muma is retiring as President and Chief Executive Officer but will remain with the company as a consultant to the new CEO until June 30, 2006. He will also continue to serve as a director until Fiserv's 2006 annual shareholder meeting.

The 'change in control' provisions in Mr. Yabuki's Employment Agreement and KEESA are designed to protect him. If his employment is terminated by the company without cause or if he resigns for 'good reason' within three years after a change in control, he is entitled to significant severance. The agreement also includes provisions for grossing up excise taxes related to 'excess parachute payments' to ensure he receives the full benefit of his severance.