UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current
Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 10, 2016
Pegasystems Inc.
(Exact
name of registrant as specified in its charter)
Commission File Number: 1-11859
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Massachusetts
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04-2787865
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(State or other jurisdiction of
incorporation)
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(IRS Employer
Identification No.)
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One Rogers Street, Cambridge, Massachusetts 02142
(Address of principal executive offices, including zip code)
617-374-9600
(Registrant’s telephone number, including area code)
Not Applicable
(Former
name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions:
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¨
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 5.02.
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Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
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On June 14, 2016, Pegasystems Inc. (the “Company”) announced that it has appointed Ken Stillwell, age 45, as the Company’s
Chief Administrative Officer, Chief Financial Officer and Senior Vice President, effective July 7, 2016.
Mr. Stillwell’s
offer letter specifies the details of his compensation and provides for his employment on an “at-will” basis at an annual base salary of $400,000. Mr. Stillwell is eligible for an annual bonus of up to fifty percent of his base
salary, subject to the funding provisions of the applicable bonus plan. Mr. Stillwell is also eligible to receive a $200,000 sign-on bonus, which is repayable to the Company in the event of a voluntary termination by Mr. Stillwell, or a
causal termination by the Company, within twelve months of Mr. Stillwell’s date of hire. In the event the Company terminates Mr. Stillwell’s employment without cause, he is eligible to receive a severance payment equal to six
months of his base salary, plus an additional month for each year of service up to a maximum of twelve months, provided Mr. Stillwell signs a mutually acceptable form of release. Additionally, in the event of a change of control and termination
of Mr. Stillwell’s employment, Mr. Stillwell’s unvested equity will accelerate.
The Company will also provide
Mr. Stillwell with an equity grant, of which sixty percent will be stock options and forty percent restricted stock units, and for which the Company will incur a $3,000,000 expense and the estimated timeframe for consideration for an additional
grant will be deferred to January 2018. The grant is subject to approval by the Company’s Compensation Committee following the commencement of Mr. Stillwell’s employment. The vesting schedule for the equity grant is subject to
acceleration in full, in the event of a change in control and termination of Mr. Stillwell’s employment.
A copy of
Mr. Stillwell’s offer letter is attached hereto as Exhibit 99.1.
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Item 5.07.
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Submission of Matters to a Vote of Security Holders
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The 2016 Annual Meeting of
Stockholders of the Company was held on June 10, 2016. At the Annual Meeting, the following items were presented to the stockholders of the Company for their approval, and approved by the indicated votes:
1. To elect the eight nominees named in the Company’s definitive proxy statement to serve on the Company’s Board of Directors until its 2017 Annual
Meeting of Stockholders. Each nominee for director was elected by a vote of stockholders as follows:
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Peter
Gyenes
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Richard
Jones
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Steven
Kaplan
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James
O’Halloran
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Sharon
Rowlands
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Alan
Trefler
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Larry
Weber
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William
Wyman
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FOR
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61,461,587
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61,896,207
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62,018,399
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61,483,339
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64,770,026
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64,133,473
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61,982,109
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62,012,147
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AGAINST
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3,466,364
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3,031,530
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2,909,816
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3,444,876
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158,995
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810,073
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2,945,995
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2,915,943
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ABSTAIN
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23,431
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23,645
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23,167
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23,167
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22,361
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7,836
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23,278
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23,292
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NON VOTES
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5,976,384
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5,976,384
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5,976,384
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5,976,384
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5,976,384
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5,976,384
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5,976,384
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5,976,384
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2. To approve, by a non-binding advisory vote, the compensation of the Company’s named executive officers.
The compensation of the Company’s named executive officers was approved on a non-binding advisory basis by a vote of stockholders as follows:
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Executive
Compensation
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FOR
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64,802,499
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AGAINST
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130,284
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ABSTAIN
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18,599
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NON VOTES
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5,976,384
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3. To approve the amended and restated Pegasystems Inc. 2004 Long-Term Incentive Plan. The proposal was approved by a vote of
stockholders as follows:
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Long-Term
Incentive
Plan
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FOR
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45,092,472
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AGAINST
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19,632,950
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ABSTAIN
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225,960
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NON VOTES
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5,976,384
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4. To approve the Restricted Stock Unit Sub-Plan of the Pegasystems Inc. 2004 Long-Term Incentive Plan for French
Participants. The proposal was approved by a vote of stockholders as follows:
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French RSU
Sub-Plan
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FOR
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59,710,287
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AGAINST
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5,013,633
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ABSTAIN
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227,462
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NON VOTES
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5,976,384
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5. To ratify the selection by the Audit Committee of the Company’s Board of Directors of Deloitte & Touche LLP
as the Company’s independent registered public accounting firm for the year ending December 31, 2016. The proposal was approved by a vote of stockholders as follows:
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Auditors
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FOR
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70,722,617
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AGAINST
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199,698
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ABSTAIN
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5,451
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Item 7.01.
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Regulation FD Disclosure
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On June 14, 2016, the Company issued a press release
announcing the appointment of Mr. Stillwell as its Chief Administrative Officer, Chief Financial Officer and Senior Vice President, effective July 7, 2016.
A copy of the Company’s press release is attached hereto as Exhibit 99.2.
Signature(s)
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
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Pegasystems Inc.
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Date: June 14, 2016
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By:
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/s/ Anne T. Warner
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Anne T. Warner
General Counsel and
Secretary
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Exhibit Index
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Exhibit No.
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Description
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EX-99.1
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Offer Letter between Pegasystems Inc. and Ken Stillwell dated June 1, 2016
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EX-99.2
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Press Release Issued June 14, 2016
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Exhibit 99.1
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PEGASYSTEMS INC.
One Rogers
Street
Cambridge, MA 02142-1590. USA
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Ken Stillwell
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June 1, 2016
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Dear Ken:
Pegasystems is
pleased to offer you the position of Chief Administrative Officer, Chief Financial Officer and Senior Vice President, presently reporting directly to Alan Trefler. This offer is contingent upon the successful completion of our pre-employment process
and upon your signing the enclosed Standards Letter. Your starting salary for this position will be paid at a biweekly rate of $15,384.61 at the annualized rate of $400,000.00. You will also be eligible to participate in our Corporate Incentive
Compensation Plan (CICP), at a target rate of 50% of your base salary which in 2016 is $200,000.00 on an annualized basis. Your 2016 CICP will be pro-rated based on your start date and in accordance with the terms of the CICP in effect for each
applicable year, bringing your potential annualized on target earnings to $600,000.00.
As a demonstration of the company’s commitment to you, we
will provide you with an equity grant for which Pega’s future financial statements will incur $3,000,000.00 of expense. The value of this equity grant will be comprised of 60% stock options and 40% Restricted Stock Units (RSUs) pursuant to our
Long-Term Incentive Plan and is contingent on Compensation Committee approval at the meeting following your date of hire. The number of RSUs and Options granted will be determined based on the closing price of our common stock on the first business
day of the month following Compensation Committee approval. The full terms of this grant will be conveyed to you in a separate document after you become a Pegasystems employee. In consideration of this aggressive new hire grant, January 2018 will be
the estimated timeframe for consideration for your next equity grant
In addition, Pega agrees to provide you a $200,000.00 sign-on bonus which will be
made upon date of hire. If you voluntarily terminate your employment or Pegasystems terminates you for cause within 12 months of your date of hire, you agree to repay the sign on bonus payment made to you, within 30 days of your termination date, to
the extent that is not recouped by Pegasystems by withholding salary, variable remuneration, vacation pay, expense reimbursement or any other payments due to your upon such termination.
You will be eligible to participate in the benefit programs which Pegasystems makes available to similarly situated employees, providing the option to elect
individual or family coverage in our medical, dental and vision plans. In addition, we offer a tuition reimbursement program, a 401(k) plan, and medical and dependent care reimbursement accounts which enable you to pay for eligible expenses with
pre-tax dollars. Pega will also provide you with short-term disability, long-term disability, life insurance and long-term care insurance. You will accrue paid time-off in accordance with Pegasystems’ Paid Time-Off Policy which will provide 20
days of vacation per year. Your vacation is prorated during your first year of employment. A summary of these benefits are included for your convenience. Please note that our compensation and benefit plans are subject to change at any time.
This offer of employment is not a contract. Pegasystems is an at-will employer and either you or Pegasystems may terminate employment at any time. In the
event that Pegasystems terminates your employment without cause, you will be entitled to severance equal to six months of base salary, plus an additional month for each year of service with a maximum of 12 months, provided that you sign a mutually
acceptable form of release. In the event of a change of control and termination of your employment as CAO and CFO, all unvested Pega equity will accelerate.
As discussed, we would like you to begin working as a full-time employee as soon as possible, but no later than Wednesday, July 6, 2016. As a
condition of employment, we require you to sign and return the enclosed Standards Letter and provide proper employment authorization. Please note that as a requirement to work in the United States, you must complete the Employment Eligibility
Verification (I-9) form and bring with you the required supporting identification. We would appreciate a written response by 12:00pm on June 10, 2016. Please send both your signed Offer Letter and Standards Letter to our Cambridge office, in
care of Kate Guarino (kate.guarino@pega.com).
Please do not hesitate to call Alan or me with any questions. We are all delighted at the prospect of your
joining our staff and working with us!
Sincerely,
/s/
Jeffrey Yanagi
Jeff Yanagi
Senior Vice President, Human
Resources
I accept the terms of this offer letter and will begin work at Pegasystems on July 6, 2016.
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/s/ Ken Stillwell
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June 8, 2016
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Ken Stillwell
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Date
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web www.pega.com
phone
(1) 617.374.9600
Exhibit 99.2
Pegasystems Appoints Ken Stillwell Chief Financial Officer and Chief Administrative Officer
CAMBRIDGE, Mass. – June 14, 2016 –
Pegasystems Inc.
(NASDAQ: PEGA), the software company empowering the world’s leading
enterprises with strategic business applications, today announced it has appointed Ken Stillwell, 45, as chief financial officer and chief administrative officer, effective July 7, 2016. Mr. Stillwell will lead Pegasystems’ finance,
legal, IT, and facilities operations, reporting to founder and CEO Alan Trefler.
Mr. Stillwell has more than 20 years of financial leadership
experience in high growth organizations in the technology sector. He joins Pega from Dynatrace, the premier digital performance platform, where he served as senior vice president and chief financial officer. While at Dynatrace, he oversaw the global
functions within finance and accounting, as well as expanded non-financial functions such as HR, IT, and legal. Prior to Dynatrace, he was executive vice president and chief financial officer at SOVOS, a financial and compliance software as a
service (SaaS) company in Boston, where he managed a number of operational functions in addition to his duties as CFO. Mr. Stillwell also brings five years of financial leadership experience at PTC, where he served as the divisional CFO within
the product lifecycle management (PLM) and application lifecycle management (ALM) segment for the $1.3 billion publicly traded software company.
Mr. Stillwell is a graduate of the University of Pittsburgh, where he earned his undergraduate degree in business/economics, and the University of South
Carolina, where he earned his master’s in accounting and finance. Mr. Stillwell is a certified public accountant and will be based in Cambridge, Mass.
Quotes & Commentary:
“I am delighted to
announce the appointment of Ken to our executive team,” said Alan Trefler, founder and CEO, Pegasystems. “Ken’s financial and operational experience helping technology-focused organizations seize new opportunities fits perfectly with
our vision. Ken’s ability to continuously improve operations to support growth will be a significant asset as Pega continues to expand its presence both within our current client base and with new prospects around the globe.”
“Pegasystems has a long history of award-winning success in the CRM and business software landscape,” said Ken Stillwell. “I am honored to join
such a well-respected organization with exciting opportunities for continued growth. I look forward to working with the leadership team and helping the organization accelerate its strong track record of growth and client success.”
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About Pegasystems
Pegasystems (NASDAQ: PEGA) develops strategic applications for marketing, sales, service, and operations. Pega’s applications streamline critical business
operations, connect enterprises to their customers seamlessly in real-time across channels, and adapt to meet rapidly changing requirements. Pega’s Global 3000 customers include many of the world’s most sophisticated and successful
enterprises. Pega’s applications, available in the cloud or on-premises, are built on its unified Pega 7 platform, which uses visual tools to easily extend and change applications to meet clients’ strategic business needs. Pega’s
clients report that Pega gives them the fastest time to value, extremely rapid deployment, efficient re-use, and global scale. For more information, please visit us at
www.pega.com
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Forward-Looking Statement
This press release contains
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on the Company’s current expectations. The words “growth,” “expand,” “look forward,”
“accelerate,” or variations of such words and similar expressions, among others, identify forward-looking statements, which speak only as of the date the statement was made. These statements are based on current expectations and
assumptions and involve various risks and uncertainties, including but not limited to those related to growth and client success, which could cause the Company’s actual results to differ from those expressed in such forward-looking statements.
Additional factors include those contained in the Risk Factors sections of the Company’s Form 10-K for the year ended December 31, 2015 and the Company’s Form 10-Q for the quarter ended March 31, 2016, which are available on the
Company’s website at
http://www.pega.com/about/investors
. The Company assumes no obligation for and does not intend to update these forward-looking statements as a result of future events or developments.
Press Contact:
Sean Audet
Pegasystems Inc.
sean.audet@pega.com
(617) 528-5230
Twitter:
@pega
Investor Contact:
Sheila Ennis
ICR for Pegasystems
PegaInvestorRelations@pega.com
(617) 866-6077
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