Item 5.02 Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective as of May 29, 2020, Richard Rosenstein
was appointed Chief Financial Officer of Acacia Research Corporation (the “Company”), and Meredith Simmons was appointed
General Counsel of the Company.
Mr. Rosenstein, age 55, most recently served
as Chief Financial Officer of CLEAR, the biometric identity platform, since 2017. Prior to joining CLEAR, he served in chief financial
officer roles at Independent Sports and Entertainment, a leading sports management and consulting agency, and SFX Entertainment
(now LiveStyle, Inc.), the largest global producer of live events and digital entertainment content focused on electronic music,
following many years as a Managing Director in equity research at Goldman Sachs and as an investor at Baron Capital. Mr. Rosenstein
has a BA from the University of Pennsylvania and an MBA from Columbia Business School.
Ms. Simmons, age 39, most
recently served as General Counsel and Chief Compliance Officer of Mason Capital Management LLC
from 2011 to 2018, as well as Partner of Thistle Partners, LLC, a consulting firm that advises private
equity and hedge funds, from 2018 to 2020. Prior to this, Ms. Simmons was a Vice President and
Assistant General Counsel at Cantor Fitzgerald, and an Associate Attorney at Epstein, Becker, and Green, P.C;
Winston and Strawn, LLP; and Holland and Knight, LLP. Ms. Simmons has a BA from the University of
California, Los Angeles and JD from Georgetown University Law Center. She also holds an LLM from New York
University Law School.
Each of Mr. Rosenstein and Ms. Simmons
has entered into an Employment Agreement (the “Employment Agreements”) with the Company and Acacia Research Group LLC,
the Company’s primary operating subsidiary.
Pursuant to the terms of Mr. Rosenstein’s
Employment Agreement, he will (i) receive an annual salary of $425,000 (ii) be eligible to receive an annual bonus in an amount
equal to 25-100% of his annual salary with a target of 50%, to be determined by the Compensation Committee of the Board of Directors
(the “Committee”) in accordance with annual performance objectives established by the Committee on an annual basis,
(iii) receive an initial grant of 86,500 restricted stock units that will vest at the end of a three-year period.
Pursuant to the terms of Ms. Simmons’s
Agreement, she will (i) receive an annual salary of S400,000 (ii) be eligible to receive an annual bonus in an amount equal to
25-75% of her annual salary, with a target of 50%, to be determined by the Committee in accordance with annual performance objectives
established by the Committee on an annual basis, (iii) receive an initial grant of 80,000 restricted stock units that will vest
at the end of a three-year period.
The Employment Agreements provide for certain
payments to each of Mr. Rosenstein and Ms. Simmons upon termination by the Company. The Company may terminate Mr. Rosenstein or
Ms. Simmons’s employment with or without Cause (as defined in the Employment Agreements), or upon their death or permanent
disability. Each of Mr. Rosenstein or Ms. Simmons may resign for Good Reason (as defined in the Employment Agreements) at any time
and without Good Reason upon 30 days’ written notice.
Upon termination by the Company for Cause
or upon resignation by Mr. Rosenstein or Ms. Simmons without Good Reason, each of Mr. Rosenstein or Ms. Simmons as applicable,
is entitled to receive payment for (i) any unpaid salary earned through the date of termination, (ii) any earned but unused vacation
time as of the date of termination, (iii) reimbursement for business expenses incurred but not yet paid as of the date of termination
and (iv) any other payments or benefits to which he may be entitled to under any other arrangement or applicable law (collectively,
the “Accrued Obligations”).
Upon termination by the Company without
Cause or resignation for Good Reason, (i) Mr. Rosenstein shall be entitled to continued payment of his base salary for 12 months,
and (ii) Ms. Simmons shall be entitled to continued payment of her base salary for three (3) months.
Since the beginning of the Company’s
last fiscal year, the Company paid $131,000 to Ms. Simmons for certain consulting services.
Other than as set forth above, there have
been no transactions with the Company and there are currently no proposed transactions with the Company, in which the amount involved
exceeds $120,000 and in which either Mr. Rosenstein or Ms. Simmons had or will have a direct or indirect material interest within
the meaning of Item 404(a) of Regulation S-K, since the beginning of the Company’s last fiscal year through the present.
No arrangement or understanding exists between either of Mr. Rosenstein or Ms. Simmons and any other person pursuant to which either
of them was selected as an officer of the Company. No “family relationship,” as that term is defined in Item 401(d)
of Regulation S-K, exists among Mr. Rosenstein or Ms. Simmons, on the one hand, and any of the Company’s directors or executive
officers, on the other hand.
The foregoing description of the Employment
Agreements does not purport to be complete and is subject to and qualified in its entirety by reference to the full and complete
text of the Employment Agreements, which are filed hereto as Exhibits 10.1 and 10.2.