Craig Morgan
JACK HENRY & ASSOCIATESAbout Craig Morgan
Craig K. Morgan, age 49, is Chief Legal Officer and Secretary at Jack Henry & Associates, overseeing legal, risk, compliance, and corporate responsibility; he has served as the company’s top legal executive since November 2016, having joined Jack Henry in 2004 after earlier work in biotechnology R&D . During FY2025, Jack Henry delivered $2.38B revenue and non-GAAP adjusted operating income of $571.5M (the company’s core compensation metric), and its FY2023 performance-share cycle ended with a 3-year TSR of 3.48% (34th percentile vs peer group), a 6.8% organic revenue CAGR (0% payout), and 0.9% operating margin expansion (180% payout), underscoring mixed TSR/revenue but strong margin outcomes that directly impacted executive equity payouts .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Jack Henry & Associates | Managing Corporate Counsel | 2004–2016 | Progressively expanded legal responsibilities supporting growth and risk oversight |
| Jack Henry & Associates | General Counsel & Secretary | Nov 2016–Jul 2025 | Led legal and corporate secretary functions; elevated governance and compliance |
| Jack Henry & Associates | Chief Legal Officer & Secretary | Jul 2025–Present | Oversees legal, risk, compliance, and corporate responsibility company-wide |
| Biotechnology industry | R&D roles | Pre-2004 | Technical background informs risk/compliance rigor |
Fixed Compensation
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Base Salary ($) | $415,917 | $434,300 | $445,179 (salary paid; 2025 base set at $451,758 from Jan 2025) |
| All Other Compensation ($) | $18,278 | $19,403 | $17,579 |
Notes:
- FY2025 base salary increased 3.0% to $451,758 effective January 2025; amounts above reflect fiscal-year cash paid .
Performance Compensation
Annual Incentive (FY2025)
| Metric | Weighting | Target | Actual | Payout |
|---|---|---|---|---|
| Adjusted Operating Income (non-GAAP) | 75% | $540.7M post-bonus threshold; $571.2M pre-bonus target mechanics | $571.5M pre-bonus (100.1% of target) | 100.2% of target |
| Strategic Executive Goals (customer/employee satisfaction, initiatives, controls, sales) | 25% | Committee holistically assessed; individual modifier ±25% possible | Achieved 100% (no individual modifier applied) | 100% (component) |
| Individual Outcome (Craig Morgan) | — | Target bonus 90% of base | — | $407,192 (100.2% of target) |
Key design features: Bonuses capped at 200%; no payout unless adjusted operating income threshold is met .
Long-Term Incentives (Grants on Aug 4, 2024)
| Award Type | Metric | Weight | Threshold | Target | Max | Units (Morgan) | Grant-Date Fair Value ($) |
|---|---|---|---|---|---|---|---|
| Performance Shares | Relative TSR vs peer group | ~60% | 25th percentile (50% vest) | 50th percentile (100%) | ≥80th percentile (200%) | 955 / 1,910 / 3,820 (thr/target/max) | $398,541 |
| Performance Shares | Organic Revenue CAGR (non-GAAP) | ~20% | 6.5% (50%) | 7.0% (100%) | 8.5% (200%) | 319 / 637 / 1,274 | $104,143 |
| Performance Shares | Operating Margin Expansion (non-GAAP) | ~20% | 0.3% (50%) | 0.7% (100%) | 1.0% (200%) | 319 / 637 / 1,274 | $104,143 |
| Restricted Stock Units (RSUs) | Time-based | ~40% | — | 3 equal annual tranches | — | 2,123 | $351,889 |
Vesting mechanics:
- PSUs: cliff vest after 3 years; TSR, organic revenue CAGR, and non-GAAP operating margin expansion calculated with defined adjustments; pro-rata vesting on retirement/death/disability; change-in-control converts PSUs to time-based with target (or higher for TSR, if applicable) upon qualified termination .
- RSUs: equal annual installments over 3 years from grant date; continued vesting on qualified retirement (with covenants); accelerated on double-trigger CIC termination .
Recent PSU cycle results (FY2023 awards measured through FY2025):
- 3-year TSR: 3.48% → 34th percentile → 52.7% payout .
- 3-year Organic Revenue CAGR: 6.8% → 0% payout .
- 3-year Operating Margin Expansion: 0.9% → 180% payout .
Stock vested in FY2025 (value realized):
- 3,214 shares; $552,859 for Morgan .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 10,252 shares (<1% of outstanding); includes 1,207 in the Retirement Plan |
| Deferred Compensation Elections | 708 RSUs elected for deferral (settled in stock or cash at company option upon separation or specified date) |
| Outstanding RSUs (Unvested) | 551 (2022 grant; $99,274), 1,339 (2023; $241,248), 2,123 (2024; $382,501), valued at $180.17/share as of 6/30/2025 |
| Outstanding Performance Shares (max disclosure) | 4,960 (2022; $893,643), 6,028 (2023; $1,086,065), 5,413 (2024; $975,260), valued at $180.17/share as of 6/30/2025 |
| Ownership Guidelines | 1× base salary requirement; 75% of net shares retained until met; measured as of 6/30/2025 all covered individuals were compliant or within the 5-year window |
| Hedging/Pledging | Prohibited for executives; no short sales, options, margin accounts, or pledges allowed under Trading in Company Securities Policy |
Employment Terms
| Scenario | Cash Severance (Base×Multiple + Target Bonus×Multiple) | Welfare Benefits (18 months) | Equity Treatment | Total |
|---|---|---|---|---|
| Change-in-Control Termination (double trigger; within 90 days before to 2 years after) | 1.5× base + 1.5× target bonus → $1,694,093 | $30,646 lump sum | RSUs: full vest on qualified termination; PSUs: vest at target (or TSR-higher if applicable) on qualified termination | $4,011,276 (includes $2,286,537 equity vesting) |
| Termination without Cause / Resignation for Good Reason (no CIC) | 1.5× base → $1,084,219 paid ratably over 1.5 years; prorated current-year bonus at normal payout timing | $30,646 lump sum | Equity per original award terms (no Severance Plan acceleration) | $1,114,865 |
Additional terms:
- Non-compete and non-solicit covenants: 2 years; continuous non-disparagement; release of claims required for severance .
- No employment contracts; severance plan governs executive protections (double-trigger CIC; no excise tax gross-ups) .
- Clawback policy (Nasdaq-compliant) requires recovery of erroneously awarded incentive comp for restatements; adopted November 2023 .
Compensation Structure Analysis
- Pay mix emphasizes at-risk performance pay: annual bonus tied 75% to adjusted operating income and 25% to strategic goals; LTI split ~60% PSUs (TSR/revenue/margin) and ~40% time-based RSUs .
- FY2025 bonus paid at 100.2% of target on achieving 100.1% of pre-bonus adjusted operating income and 100% strategic goals, indicating disciplined budget alignment; no individual modifiers applied .
- Peer benchmarking and target design: compensation compared to a defined software/payments/data peer set, targeting ~50th percentile; TSR measured vs compensation peers plus Fiserv and FIS as reference peers .
Investment Implications
- Alignment: Ownership guidelines (1× salary with retention until met), prohibited hedging/pledging, and a robust clawback reduce misalignment and speculative risk, supporting investor-friendly governance .
- Retention and transition risk: Double-trigger CIC severance and equity acceleration create retention stability through change events; non-compete/non-solicit terms and pro-rata PSU vesting at retirement/death/disability further mitigate flight risk while preserving performance linkage .
- Selling pressure and vesting calendar: No stock options outstanding and RSUs vest in annual tranches (e.g., Aug 4 anniversaries for 2022–2024 grants), suggesting periodic settlement-related liquidity but limited forced-selling risk due to anti-pledging/hedging policies .
- Performance signals: Mixed PSU outcomes (TSR/revenue below targets, margin expansion above target) highlight margin discipline amid subdued TSR; FY2025 bonuses paid near target reflect execution against plan—monitor future PSU vest outcomes tied to organic growth/margin expansion for leading indicators of pay realization .
- Shareholder sentiment: Strong say-on-pay support (93% in 2024) underscores credibility of compensation design; continued alignment hinges on delivering organic growth while sustaining margin progress embedded in PSU metrics .