FALCONSTOR SOFTWARE, INC. (NASDAQ:FALC) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain OfficersItem 5.02.
On August 14, 2017, the Board appointed Patrick McClain to serve as the Company’s Executive Vice President, Chief Financial Officer and Treasurer. Mr. McClain shall also assume the roles of principal financial officer and principal accounting officer of the Company.
Mr. McClain, 61, served as Chief Financial Officer of Aurea Software Inc., an enterprise software platform within ESW Capital, Inc., from January 2013 to July 2016. Mr. McClain served as Senior Vice President and Chief Financial Officer of Rules-Based Medicine Inc., a biotechnology company, from September 2002 to December 2011. During the preceding 15 years, Mr. McClain operated a professional consulting company providing Chief Financial Services to over 20 privately held technology companies. Mr. McClain began his professional career with Price Waterhouse were he served as audit manager for 6 years. Mr. McClain holds a BBA degree in Accounting from Ohio University.
Mr. McClain does not have any family relationships with any of the directors, executive officers, or any people nominated or chosen by the Company to become a director or executive officer. Mr. McClain is not a party to any transaction listed in Item 404(a) of Regulation S-K.
In connection with Mr. McClain’s appointment as Chief Financial Officer, the Board approved an offer letter to Mr. McClain (the “McClain Offer Letter”), which was executed on August 17, 2017. The McClain Offer Letter provides that Mr. McClain is entitled to receive an annualized base salary of $240,000, payable in regular installments in accordance with the Company’s general payroll practices. Mr. McClain will also be eligible for a cash bonus of $10,000 for any quarter that is free cash flow positive on an operating basis and additional incentive compensation of an annual bonus of up to $80,000, subject to attainment of performance objectives to be mutually agreed upon and established.
Mr. McClain’s employment can be terminated at will. If Mr. McClain’s employment is terminated by the Company other than for cause he is entitled to receive severance equal to six (6) months of his base salary if (i) he has been employed by the Company for at least twelve (12) months at the time of termination or (ii) a change of control has occurred within six (6) months of Mr. McClain’s employment. Except as set forth in the preceding sentence, Mr. McClain is entitled to receive severance equal to three (3) months of his base salary if he has been employed by the Company for less than six (6) months and his employment was terminated by the Company without cause. Mr. McClain is also entitled to vacation and other employee benefits in accordance with the Company’s policies.
The foregoing description of the McClain Offer Letter does not purport to be complete and is qualified in its entirety by reference to the McClain Offer Letter, which is attached as Exhibit 10.4 to this Current Report on Form 8-K and incorporated herein by reference.
| Item 7.01 | Regulation FD Disclosure. |
On August 17, 2017, the Company announced the appointment of Messrs. Brooks and McClain in a press release. A copy of the press release is attached to this report as Exhibit 99.1.
The information contained in this Item 7.01 to this Current Report on Form 8-K and the exhibit attached hereto pertaining to this item shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information or such exhibits be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. The information set forth in the exhibits to this Current Report on Form 8-K relating to this Item 7.01 shall not be deemed an admission as to the materiality of any information in this report that is required to be disclosed solely to satisfy the requirements of Regulation FD.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit No. | Exhibits |
| 10.1 | Separation Agreement and General Release between FalconStor Software, Inc. and Todd Oseth, dated August 15, 2017. |
| 10.2 | Offer Letter between FalconStor Software, Inc. and Todd Brooks, dated August 14, 2017. |
| 10.3 | Separation Agreement and General Release between FalconStor Software, Inc. and Daniel Murale, dated August 16, 2017. |
| 10.4 | Offer Letter between FalconStor Software, Inc. and Patrick McClain, dated August 17, 2017. |
| 99.1 | Press Release dated August 17, 2017 announcing the appointment of Todd Brooks and Patrick McClain. |
FALCONSTOR SOFTWARE INC ExhibitEX-10.1 2 ex101to8k04637006_08172017.htm Exhibit 10.1 SEPARATION AGREEMENT AND GENERAL RELEASE (“AGREEMENT”) In return for the mutual promises in this Agreement,…To view the full exhibit click here
About FALCONSTOR SOFTWARE, INC. (NASDAQ:FALC)
FalconStor Software, Inc. is a Software-Defined Storage (SDS) company offering a converged data services software platform. The Company’s platform FreeStor, allows information technology (IT) organizations minimize and eliminate that complexity with the delivery of migration, continuity, protection, recovery and optimization for any storage environment through a management interface for a price based on managed capacity across arrays, servers, hypervisors, data centers, and the cloud. The Company’s Intelligent Abstraction core provides a scalable storage hypervisor, coupled with a data services engine and automation. The Company’s Business Continuity and Disaster Recovery products include network storage server (NSS) and continuous data protector (CDP). Its Optimized Backup and Deduplication (OBD) products merge its virtual tape library (VTL) and file-interface deduplication system (FDS) solutions.
