8-KLeadership ChangesExhibits & Filings

Fortinet, Inc. 8-K Report, Executive Changes (May 30, 2017)

Filed May 30, 2017For Securities:FTNT

Summary

Fortinet, Inc. (FTNT) announced on May 29, 2017, a material change to its Board of Directors through an 8-K filing. The company expanded its board from eight to nine members and appointed Peter D. Cohen as a Class I director, effective July 14, 2017. This expansion aims to strengthen corporate governance and potentially bring in new expertise. Mr. Cohen's appointment is not tied to any specific arrangements with third parties. Mr. Cohen's compensation as a director aligns with the company's standard practices, including an annual cash retainer of $40,000 and a grant of 15,000 restricted stock units (RSUs) vesting over three years. He will also be subject to the company's standard indemnification and change of control agreements for non-executive directors, meaning his unvested equity awards would vest upon a change of control. Investors should monitor any committee assignments Mr. Cohen receives, as this information will be disclosed in a subsequent filing.

Key Highlights

  • 1Fortinet expanded its Board of Directors from eight to nine members.
  • 2Peter D. Cohen was appointed as a new Class I director.
  • 3Mr. Cohen's directorship is effective July 14, 2017.
  • 4He will receive an annual cash retainer of $40,000.
  • 5Mr. Cohen is set to receive a grant of 15,000 RSUs vesting over three years.
  • 6His equity awards are subject to immediate vesting upon a change of control.
  • 7No arrangements or understandings exist between Mr. Cohen and others regarding his selection.

Frequently Asked Questions

While the filing doesn't explicitly state the reason for the expansion, it is common practice for companies to grow their board to enhance governance, diversify skill sets, or accommodate new strategic directions. Investors can look for future committee assignments to understand where Mr. Cohen's expertise might be applied.

Mr. Cohen will receive an annual cash retainer of $40,000, paid quarterly. He will also be granted 15,000 restricted stock units (RSUs) that will vest over a three-year period, aligning with Fortinet's standard compensation policy for non-executive directors.

The filing indicates that Mr. Cohen has entered into standard indemnification and change of control agreements for non-executive directors. Notably, under the change of control agreement, all of his unvested equity awards, including the RSUs, will vest immediately prior to a change of control event.

The filing states that Mr. Cohen has not yet been appointed to any standing committees of the Board. Fortinet will file an amendment to this 8-K to disclose any such appointments once they are made.