National Holdings Corporation (NASDAQ:KSIH) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Item 5.02. Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers

Effective January 3, 2017 (the Effective Date), Michael Mullen
was appointed as Co-Chief Executive Officer of National Holdings
Corporation (the Company), until such time as the other Co-Chief
Executive Officer of the Company (Robert B. Fagenson) has been
removed or has resigned, in which case Mr. Mullen will
automatically assume the title and duties of Chief Executive
Officer under the terms of his employment agreement. In addition,
Mr. Mullen will be Chairman of the Board of each of Companys
operating subsidiaries including but not limited to: National
Securities Corporation, National Asset Management Corporation,
National Insurance Corporation, vFinance Corporation and Gilman
and Ciocia Corporation.

Under the terms of Mr. Mullens employment agreement, Mr. Mullen
will earn a base salary of $360,000 per year. In addition to his
base salary, Mr. Mullen will be eligible to earn an annual cash
bonus, conditioned upon the achievement of annual performance
goals and objectives established by agreement between Mr. Mullen
and the Board. Mr. Mullens target annual bonus opportunity will
be equal to 100% of his base salary, subject to his achievement
of such performance goals and objectives.

The Company will also award Mr. Mullen a total of 625,000
restricted shares of common stock of the Company. These grants
are subject to various conditions and vesting schedules, as set
forth in the employment agreement.

If Mr. Mullens employment is terminated as a result of his death
or disability, the Company must pay to the him or his estate, his
base salary through the date of his termination, any benefits
which he is entitled to receive under any Company plan, any
expense reimbursement amounts owed to him, any accrued but unpaid
annual bonuses earned by him prior to the date of his death or
termination for disability, a pro rata protion of his target
bonus during the year of termination and certain accelerated
vesting on equity securities in the Company.

If Mr. Mullens employment is terminated by the Board for cause or
by Mr. Mullen without cause, then the Company must pay to him his
base salary through the date of his termination, any expense
reimbursement amounts owed to him, and any accrued but unpaid
annual bonuses earned by him prior to the date of his
termination. Any shares of unvested annual restricted stock
awards outstanding on the date of his termination will be
forfeited without consideration as of such date.

If Mr. Mullens employment is terminated by the Company other than
as stated above or by Mr. Mullen with cause, in each case other
than in connection with a change in control of the Company, the
Company will pay to Mr. Mullen a lump sum severance payment equal
to 1.5 times the sum of his base salary, additional severance
equal to his prorated target bonus, and any expense reimbursement
amounts owed to him. Any shares of annual restricted stock awards
outstanding on the date of his termination will become
fully-vested and non-forfeitable as of his date of termination,
and any stock options outstanding on the date of his termination
will become fully-vested and will remain exercisable by him for a
period of 12 months following the date of his termination (or, if
earlier, the normal expiration date of such stock options).

If Mr. Mullens employment is terminated upon or following the
occurrence of a change in control of the Company, by the Company
(or its successor) other than as a result of Mr. Mullens death or
disability and other than by the Board for cause or by Mr. Mullen
without cause, or upon or following the occurrence of a change in
control of the Company, by Mr. Mullen for cause, the Company (or
its successor) will pay to Mr. Mullen a lump sum severance
payment equal to 2 times the sum of his base salary, additional
severance equal to his prorated target bonus, and any expense
reimbursement amounts owed to him. Any shares of annual
restricted stock awards outstanding on the date of his
termination will become fully-vested and non-forfeitable as of
such date and any stock options outstanding on the date of his
termination will become fully-vested and, provided that such
stock options are not cancelled and cashed-out in connection with
the change in control, will remain exercisable by Mr. Mullen for
12 months such date (or, if earlier, the normal expiration date
of such stock options).

The foregoing summary of the employment agreement is qualified in
its entirety by the copy of such agreement filed as Exhibit10.1
hereto and incorporated by reference.

Item 9.01.Financial Statements and
Exhibits.