8-K: Acacia Research Appoints Ernst & Young Veteran Michael Zambito as New Chief Financial Officer

Acacia Research Corporation has announced the appointment of Michael Zambito, a seasoned professional with 30 years at Ernst & Young, as its new Chief Financial Officer, effective June 24, 2025.

Summary

• Acacia Research Corporation appointed Michael Zambito as its Chief Financial Officer (CFO), effective June 24, 2025.
• Mr. Zambito will also serve as the company's principal financial officer and principal accounting officer.
• Kirsten Hoover, who served as Interim CFO, will transition to the role of Controller and remain a key member of the senior management team.
• Mr. Zambito, age 52, brings 30 years of experience from Ernst & Young, including 17 years as a Partner in its EY-Parthenon (formerly Strategy and Transactions) practice.
• His compensation package includes an annual salary of $450,000, an eligible annual bonus with a target value of $230,000, and eligible annual equity award grants with a target annualized grant date fair value of $395,000.
• The initial equity award grant is subject to Compensation Committee approval and finalization of a new equity incentive program.
• Ms. Hoover will no longer receive the additional $11,667 per month she received as Interim CFO.
• Mr. Zambito's employment is at-will, with a 30-day written notice period for termination by either party, though the company can waive his notice requirement or terminate for cause immediately.
• He is eligible to participate in the company's Amended and Restated Executive Severance Policy, contingent on executing a release of claims.

Sentiment

Score: 8

Explanation: The sentiment is highly positive due to the appointment of a very experienced CFO with a strong background in finance, M&A, and strategy, which aligns well with the company's stated growth objectives. The CEO's strong endorsement and the new CFO's positive outlook contribute to this sentiment. The transition of the interim CFO to a key role also adds to the positive outlook by ensuring continuity.

Positives

• The appointment of Michael Zambito, with 30 years of experience at Ernst & Young, including 17 years as a Partner in strategy, transactions, and corporate finance, significantly strengthens Acacia's financial leadership.
• CEO Martin D. McNulty, Jr. expressed strong confidence in Mr. Zambito, citing a long-standing professional relationship and alignment with Acacia's value-oriented approach and focus on acquiring and operating businesses.
• The continuity of Kirsten Hoover as Controller ensures stability and retains her expertise within the finance team.
• Mr. Zambito's expertise in M&A and corporate finance aligns with Acacia's strategy of scaling platforms organically and through acquisitions, leveraging its significant capital base and industry relationships.

Risks

• The employment is at-will, meaning either party can terminate it with 30 days' notice, or immediately by the company for cause, which introduces some employment stability risk.
• The new CFO's annual equity award grant is subject to Compensation Committee approval and finalization of a new equity incentive program, indicating potential uncertainty or delay in the full compensation package.
• Standard confidentiality, non-solicitation (12 months post-termination), and non-disparagement covenants apply, which are common but restrict the executive's post-employment activities.
• The company has a clawback policy for incentive compensation, meaning earned bonuses or equity could be recouped under certain circumstances.

Future Outlook

The new CFO, Michael Zambito, expressed enthusiasm to support the company in rapidly scaling its growing platforms organically and through mergers and acquisitions, leveraging its significant capital resources and unique investment approach.

Management Comments

• Martin D. McNulty, Jr., CEO: "I am very excited to announce Mikes appointment as CFO and his addition to Acacias senior management team. I, and certain members of our team, have known, and worked with, Mike for more than fifteen years and Im confident he will be a seamless and integral member of our senior team. Mike is a veteran leader and financial professional with significant industry expertise including in the industries in which we strive to grow Acacia. Mikes talents closely align with our value-oriented approach and focus on acquiring and operating businesses where we can tap into our deep industry relationships, significant capital base, and transaction expertise to materially improve performance, creating long-term value for shareholders and partners."
• Martin D. McNulty, Jr., CEO: "I would also like to express my deep and sincere gratitude to Kirsten for her instrumental efforts for the past two years as Interim Chief Financial Officer. Kirsten has worked tirelessly in ensuring Acacias success, and I am confident that she will continue to excel as a key member of Acacias finance team."
• Michael Zambito, CFO: "Im thrilled to join Acacias highly skilled and experienced management team. The new management team at Acacia has a demonstrated track record of effectively leveraging its significant capital resources to take advantage of unique situations with multiple levers for generating shareholder value. I look forward to working with MJ, Kirsten and the entire Acacia team to support the Company in rapidly scaling its growing platforms organically and through M&A."

Industry Context

This executive appointment reinforces Acacia Research Corporation's strategic focus on acquiring and operating businesses across the industrial, energy, and technology sectors. The new CFO's extensive background in strategy, transactions, and corporate finance from Ernst & Young aligns well with the company's stated objective of leveraging its capital base and transaction expertise to drive value and materially improve performance in its target industries.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders: The appointment of a highly experienced CFO is expected to enhance financial management, strategic execution, and potentially drive long-term value creation through organic growth and M&A.
• Employees: The strengthening of the senior management team with a seasoned financial professional can provide stability and clear direction, particularly within the finance department.
• Customers and Partners: A robust financial leadership team can instill greater confidence in the company's stability and strategic direction, potentially fostering stronger relationships.

Next Steps

• Finalization of a new equity incentive program for the initial equity award grant to Mr. Zambito, subject to Compensation Committee approval.
• Mr. Zambito will support the company in rapidly scaling its growing platforms organically and through M&A.

Key Dates

Keywords

Chief Financial Officer, CFO appointment, Acacia Research Corporation, ACTG, Executive appointment, Financial leadership, Corporate governance, SEC filing, 8-K, Ernst & Young, EY-Parthenon, Strategy and Transactions, M&A, Corporate finance, Executive compensation