8-KLeadership Changes

FISERV INC 8-K Report, Executive Changes (Jan 5, 2011)

Filed January 5, 2011For Securities:FISV

Summary

This 8-K filing from Fiserv, Inc. reports on the appointment of Mark A. Ernst as Executive Vice President and Chief Operating Officer, effective January 3, 2011. Mr. Ernst brings extensive experience from leadership roles at H&R Block and the Internal Revenue Service, with a strong background in operations and financial services. His appointment is accompanied by a detailed employment agreement outlining his compensation, including a base salary, incentive targets, equity awards, and benefits. The agreement also specifies terms for termination, including severance provisions and non-compete clauses. Additionally, Fiserv has entered into a Key Executive Employment and Severance Agreement (KEESA) with Mr. Ernst, which provides enhanced benefits in the event of a change in control of the company. This includes accelerated vesting of equity awards and significant severance payments if his employment is terminated under certain conditions within a specified period following a change in control. The agreements reflect Fiserv's strategy to attract and retain senior talent with robust compensation and security packages, particularly in critical operational roles.

Key Highlights

  • 1Fiserv, Inc. appointed Mark A. Ernst as Executive Vice President and Chief Operating Officer, effective January 3, 2011.
  • 2Mr. Ernst has a notable background, including previous roles as CEO of H&R Block and Deputy Commissioner for Operations Support at the IRS.
  • 3Mr. Ernst's employment agreement includes a minimum annual salary of $525,000.
  • 4He is eligible for incentive compensation with a target of 80% of base salary and equity awards with a target value of 200% of base salary.
  • 5The agreement details severance provisions, offering 1.8 times base salary if terminated by the company without cause, death, or disability.
  • 6A Key Executive Employment and Severance Agreement (KEESA) provides additional benefits upon a change in control, including accelerated equity vesting and significant severance multiples.
  • 7Non-compete and non-solicitation clauses are included in both agreements, designed to protect Fiserv's business interests.

Frequently Asked Questions

The primary purpose of this 8-K filing is to report the appointment of Mark A. Ernst as Fiserv's new Executive Vice President and Chief Operating Officer and to disclose the terms of his employment agreement and a Key Executive Employment and Severance Agreement (KEESA).

Mr. Ernst's compensation includes a base salary of at least $525,000 annually, a target cash incentive payment of 80% of his base salary, and target equity awards valued at 200% of his base salary. He also participates in standard employee benefit, welfare, retirement, and fringe benefit plans for senior executives. Additionally, he received a stock option grant on January 3, 2011.

The agreements include non-compete and non-solicitation clauses. Mr. Ernst agrees not to engage in certain competitive activities or solicit Fiserv's clients or employees for a specified period after his employment terminates. He is also bound by confidentiality provisions.

If Fiserv terminates Mr. Ernst's employment without cause, death, or disability, he is entitled to a lump sum payment equal to 1.8 times his base salary. Under the KEESA, if a change in control occurs and his employment is terminated by Fiserv without cause or by him for good reason within three years post-change, he is entitled to enhanced severance, including a cash payment of two times his annual salary plus his highest annual cash incentive, pro-rated incentive awards, and continuation of certain benefits for up to three years.