8-K

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

January 10, 2020

Date of Report

(Date of earliest event reported)

BLUCORA, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	000-25131	91-1718107
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

6333 North State Highway 161, 4th Floor

Irving, Texas 75038

(Address of principal executive offices)

(972) 870-6400

Registrant’s telephone number, including area code

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:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	BCOR	NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Departure of Chief Executive Officer

Effective January 10, 2020, John Clendening, who served as the President and Chief Executive Officer of Blucora, Inc. (the “Company”) and as a member of the Company’s board of directors (the “Board”), departed from his roles as an officer, employee and director of the Company. Mr. Clendening’s departure from the Board was not the result of any disagreement between Mr. Clendening and the Company, its management, the Board or any committee of the Board.

While a search for a permanent replacement is underway, the Board has established an interim Office of the Chief Executive Officer, comprised of Executive Leadership Team members Enrique Vasquez, who serves as the Company’s President of Wealth Management, Curtis Campbell, who serves as the Company’s President of TaxAct, Todd Mackay, who serves as the Company’s Chief Business Operations and Development Officer, and Ann Bruder, who serves as the Company’s Chief Legal Officer, to assume the duties of the Office of the Chief Executive Officer. During the interim period, the Office of the Chief Executive Officer will report to an Oversight Committee of the Board. The Company anticipates naming a successor to the Chief Executive Officer position by the end of January 2020.

In connection with Mr. Clendening’s departure, the Board has reduced the size of the Board from seven (7) directors to (6) directors. Mr. Clendening’s departure is not expected to impact the Company’s ability to comply with NASDAQ Listing Rule 5605(b), which requires that the Board consist of a majority of independent directors.

Release Agreement

On January 15, 2020, in connection with Mr. Clendening’s departure, the Company and Mr. Clendening entered into a General Release and Waiver of Claims (the “Release Agreement”). The Release Agreement provides that the Company will pay Mr. Clendening cash severance in an aggregate amount equal to $5,750,000, less applicable payroll taxes and withholdings, and extend the post-employment exercise period for certain stock options held by Mr. Clendening to December 31, 2020. In consideration for such payments, Mr. Clendening agreed to, among other things, a general release of claims in favor of the Company. As a condition to receiving his severance under the Release Agreement, Mr. Clendening will also be obligated to continue complying with certain covenants under his employment agreement, including a non-competition covenant. In addition, under the terms of the Release Agreement, each of the Company and Mr. Clendening agreed to a customary non-disparagement covenant.

Item 7.01. Regulation FD Disclosure.

On January 16, 2020, the Company issued a press release announcing the departure of Mr. Clendening. A copy of the press release is furnished as Exhibit 99.1 and incorporated herein by reference.

The Company will be hosting a conference call and live webcast to discuss the departure that will be held today, January 16, 2020, at 7:30 a.m. Central Time (8:30 a.m. Eastern Time). Interested parties may listen to the call and webcast on the Investor Relations section of the Company’s corporate website at http://www.blucora.com. The call may also be accessed by dialing (973) 200-3360. A replay of the call and webcast will also be available on the Company’s website until April 17, 2020.

The information in Item 7.01 of this Current Report on Form 8-K (including Exhibit 99.1 attached hereto) is being furnished pursuant to Item 7.01 and 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 be subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.		Description
	99.1	Press release dated January 16, 2020 (furnished herewith)
	104.1	Cover Page Interactive Data File (embedded within the Inline XBRL Document)

Safe Harbor Statement Under the Private Securities and Litigation Reform Act

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this report, terms such as “believes,” “estimates,” “should,” “could,” “would,” “plans,” “expects,” “intends,” “anticipates,” “may,” “forecasts,” “projects” and similar expressions and variations as they relate to the Company or its management are intended to identify forward-looking statements. Actual results may differ significantly from management’s expectations due to various risks and uncertainties including, but not limited to: our ability to effectively implement our future business plans and growth strategy; our ability to effectively compete within our industry; our ability to attract and retain customers; our ability to realize all of the anticipated benefits of acquisitions; the availability of financing and our ability to meet our current and future debt service obligations and comply with our debt covenants; our ability to generate strong investment performance for our customers and the impact of the financial markets on our customers’ portfolios; political and economic conditions and events that directly or indirectly impact the wealth management and tax preparation industries; our ability to attract and retain productive financial advisors; our ability to successfully make technology enhancements and introduce new and improve on existing products and services; our expectations concerning the revenues we generate from fees associated with the financial products that we distribute; our ability to manage leadership and employee transitions; risks related to goodwill and other intangible asset impairment; our ability to comply with regulations (or interpretations thereof) applicable to the wealth management and tax preparation industries, including increased costs associated with or reductions in revenue resulting from new or changing regulations or interpretations of existing regulations; risks associated with our business being subject to enhanced regulatory scrutiny; our ability to comply with laws and regulations regarding privacy and protection of data; our expectations concerning the benefits that may be derived from our clearing platform and our investment advisory platform; cybersecurity risks; our ability to maintain our relationships with third party partners; the seasonality of our business; litigation risks; our ability to attract and retain qualified employees; our assessments and estimates that determine our effective tax rate; the impact of new or changing tax legislation; our ability to develop, establish and maintain strong brands; our ability to protect our intellectual property; and our ability to effectively integrate other companies or assets that we may acquire.

A more detailed description of these and certain other factors that could affect actual results is included in the Company’s filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of this report, except as may be required by law.

SIGNATURES

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.

Date: January 16, 2020

BLUCORA, INC.
By:	/s/ Ann J. Bruder
	Ann J. Bruder
	Chief Legal Officer and Secretary

EX-99.1

Exhibit 99.1

Blucora Announces Departure of CEO John Clendening

Company anticipates naming a new CEO by end of January

Company has established the Office of the CEO to lead the Company and report to Oversight Committee of the Board of Directors prior to its new CEO joining

IRVING, Texas, January 16, 2020 – Blucora, Inc. (NASDAQ: BCOR), a leading provider of tax-smart financial solutions that empower people’s goals, today announced that President and Chief Executive Officer John Clendening has departed his roles as executive and member of the Board of Directors. The Company anticipates announcing a new CEO by the end of January 2020.

“I’m proud of all that our team has accomplished and the significant value it has delivered for customers, advisors and shareholders during the past four years,” Clendening said. “Our results speak for themselves, with significant improvement in our financial performance. The markets have recognized this progress, with the stock increasing in value by nearly 400% from less than $5 to yesterday’s close. Blucora has an exciting vision and the team to deliver results. I wish nothing but the very best for the Company, its employees and its customers, and I’ll always be grateful for my time leading the firm.”

To ensure a smooth transition for the Company and its employees, advisors and customers, Blucora has established an interim Office of the CEO, comprised of Executive Leadership Team members Enrique Vasquez, Curtis Campbell, Todd Mackay and Ann Bruder, which will lead the company and report to an Oversight Committee of the Company’s Board of Directors. Vasquez will continue to oversee the wealth management business, and Campbell will continue to oversee the TaxAct business as it drives toward another successful tax season. Mackay will oversee the closing of the HK Financial Services (HKFS) acquisition, as well as spearhead the operational improvements of Avantax Wealth Management (AWM) and continue to lead business operations, and Bruder will oversee certain administrative and staff functions during the interim period.

The departure resulted from differences in views on the scope of Mr. Clendening’s authority as CEO. Blucora’s financial position and cash flows are strong, and the decision was unrelated to Blucora’s business performance, strategic vision, goals, financial reporting or internal controls.

“Blucora remains poised for its next phase of growth and success. We are committed to our incredibly talented executive leadership team and employees during this brief transition period, as we continue to provide the best products, solutions and support to our advisors and customers,” said Georganne Proctor, Chairman of Blucora’s Board. “On behalf of the Board, we have identified the right leader, who we are in the process of bringing aboard and anticipate naming by the end of January. By establishing the Office of the CEO, along with Board oversight, our already strong leadership teams will have the executive and Board guidance and support needed to continue to run our businesses effectively and execute our strategic priorities prior to the new CEO joining Blucora.”

“We have a strong executive leadership team in place,” said Proctor. “The Office of the CEO will provide a steady helm during this interim period. Enrique Vasquez, President of Avantax Wealth Management, is an accomplished senior executive with more than 25 years of wealth management and financial services

experience, including tax-focused wealth management, and will provide strong leadership to the business. Curtis Campbell, President of Tax Act, has brought a depth of experience to the helm of TaxAct, which he is guiding through the current tax season while remaining focused on longer-term objectives. Todd Mackay, the Company’s Chief Business Development and Operations Officer, is a strong leader with deep company experience who has spearheaded the acquisition of HK Financial Services and will play a critical role in planning for the successful closing, integration and execution of the strategy for HKFS, which we believe will contribute significant additional value for customers, advisors and shareholders. He will also continue his focus on improving the execution of continued operational improvement across the organization. Ann Bruder is an experienced Chief Legal Officer and leader, having been a Chief Legal and Administrative Officer at a number of public companies over the past 17 years, who will provide a steady hand during the interim period.”

“Finally, once the new CEO is in place, we expect the Company to be well positioned to complete the selection of a new Chief Financial Officer in the near term,” Proctor continued. “The Company has a talented team and strong market and financial positioning. I am confident that Blucora has a solid foundation upon which to achieve the future, significant growth opportunities.”

Over the past four years, Blucora has demonstrated healthy financial performance, while strengthening its balance sheet and leadership team, successfully completing the acquisition and integration of 1st Global, and on Jan. 7 announcing the planned acquisition of HKFS, which is expected to complement Blucora’s existing businesses and provide new opportunities for growth and value creation.

The company anticipates reporting fourth quarter and full-year 2019 earnings results in mid-February. At that time the company will also provide its typical tax season update. The company’s current tax preparation outlook for first half 2020 remains unchanged from its prior outlook of segment margin in the range of 56.7% to 57.7% on revenue growth in the 3%-5% range vs. the comparable prior-year period.

Conference Call

The company will hold a conference call for stockholders and analysts today, January 16, 2020, at 8:30a.m. EST. To access the conference call, please dial (973) 200-3360. The conference call will also be webcast simultaneously on our website at www.blucora.com. A replay of the call will also be available following the live webcast. The webcast replay will be available until April 17, 2020.

About Blucora^®

Blucora, Inc. (NASDAQ: BCOR) is on the forefront of financial technology, pioneering tax-smart financial solutions that empower people’s goals. Blucora operates in two segments including wealth management, through its Avantax Wealth Management business (formerly operating under the HD Vest and 1st Global brands), the No. 1 tax-focused broker-dealer, with $68 billion in total client assets as of September 30, 2019, and tax preparation, through its TaxAct business, the No. 3 tax preparation software by market share with approximately 3 million consumer and professional users. With integrated tax and wealth management, Blucora is uniquely positioned to provide better long-term outcomes for customers with holistic, tax-advantaged solutions. For more information on Blucora, visit www.blucora.com.

Contact:

Bill Michalek

Blucora Investor Relations

(972) 870-6463

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this release, terms such as “believes,” “estimates,” “should,” “could,” “would,” “plans,” “expects,” “intends,” “anticipates,” “may,” “forecasts,” “projects” and similar expressions and variations as they relate to the Company or its management are intended to identify forward-looking statements. Actual results may differ significantly from management’s expectations due to various risks and uncertainties including, but not limited to: our ability to effectively implement our future business plans and growth strategy; our ability to effectively compete within our industry; our ability to attract and retain customers; our ability to realize all of the anticipated benefits of acquisitions; the availability of financing and our ability to meet our current and future debt service obligations and comply with our debt covenants; our ability to generate strong investment performance for our customers and the impact of the financial markets on our customers’ portfolios; political and economic conditions and events that directly or indirectly impact the wealth management and tax preparation industries; our ability to attract and retain productive financial advisors; our ability to successfully make technology enhancements and introduce new and improve on existing products and services; our expectations concerning the revenues we generate from fees associated with the financial products that we distribute; our ability to manage leadership and employee transitions; risks related to goodwill and other intangible asset impairment; our ability to comply with regulations (or interpretations thereof) applicable to the wealth management and tax preparation industries, including increased costs associated with or reductions in revenue resulting from new or changing regulations or interpretations of existing regulations; risks associated with our business being subject to enhanced regulatory scrutiny; our ability to comply with laws and regulations regarding privacy and protection of data; our expectations concerning the benefits that may be derived from our clearing platform and our investment advisory platform; cybersecurity risks; our ability to maintain our relationships with third party partners; the seasonality of our business; litigation risks; our ability to attract and retain qualified employees; our assessments and estimates that determine our effective tax rate; the impact of new or changing tax legislation; our ability to develop, establish and maintain strong brands; our ability to protect our intellectual property; and our ability to effectively integrate other companies or assets that we may acquire.

A more detailed description of these and certain other factors that could affect actual results is included in the Company’s filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of this release, except as may be required by law.

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Document and Entity Information	Jan. 10, 2020
Cover [Abstract]
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Entity Central Index Key	0001068875
Document Type	8-K
Document Period End Date	Jan. 10, 2020
Entity Registrant Name	BLUCORA, INC.
Entity File Number	000-25131
Entity Tax Identification Number	91-1718107
Entity Address, Address Line One	6333 North State Highway 161
Entity Address, Address Line Two	4th Floor
Entity Address, City or Town	Irving
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75038
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Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, par value $0.0001 per share
Trading Symbol	BCOR
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false