8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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)March 26, 2007

Datawatch Corporation

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdictionof Incorporation)

000-19960	02-0405716
(Commission File Number)	(IRS Employer Identification No.)

Quorum Office Park 271 Mill Road Chelmsford, Massachusetts	01824
(Address of Principal Executive Offices)	(Zip Code)

(978) 441-2200

(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 (see General Instruction A.2. below):

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

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

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

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

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

(b)/(c)     Termination of Chief Financial Officer; Appointment of Chief Financial Officer

The Board of Directors of Datawatch Corporation (the “Company”) appointed Murray P. Fish, CPA, as the Chief Financial Officer, Vice President of Finance, Treasurer and Assistant Secretary on March 26, 2007 to hold office until a successor is appointed or until his earlier resignation or removal. Mr. Fish will be the Company’s principal financial and accounting officer. Mr. Fish replaces Douglas Zaccaro, who has served as the Company’s interim Chief Financial Officer since February 1, 2007. Mr. Zaccaro will continue to work with the Company as a consultant until at least May 15, 2007.

Prior to joining the Company, from 2005 until the present, Mr. Fish served as Chief Financial Officer of Cymfony, Inc., a private business intelligence company. From 2003 until 2005, Mr. Fish was the principal consultant at M.P. Fish Associates, where he provided financial consulting services to large public and private organizations. From 1998 until 2003, Mr. Fish was the Chief Financial Officer and a Director at Network-1 Security Solutions, Inc., a publicly held company. Mr. Fish holds a Bachelor of Science degree in Business Administration from Northeastern University, and an MBA from Babson College. He is 55 years old.

As the Company’s Chief Financial Officer, Mr. Fish will be paid a base salary of $170,000 per year, and will be eligible for a $2,500 bonus per quarter from his hire date until March 31, 2008, based on the achievement of certain management business objectives. Mr. Fish will also be eligible for participation in the Company’s Corporate Officers Compensation Plan, as described in our Current Report on Form 8-K which was filed on January 30, 2007. Mr. Fish was granted a stock option to purchase 15,000 shares of the Company’s common stock on March 26, 2007, and will be granted an additional stock option to purchase 10,000 shares of the Company’s common stock at the three-month anniversary of his appointment, if he remains employed by the Company at that time.

In connection with his appointment, Mr. Fish entered into a severance agreement with the Company (the “Executive Agreement”). The Executive Agreement provides that in the event the Company terminates Mr. Fish’s employment for reasons other than for “Cause” or if Mr. Fish elects to terminate his employment with the Company for “Good Reason,” he is entitled to severance payments equal to his then current monthly base salary, payable on a monthly basis for six months following his termination date. “Cause” is defined in the Executive Agreement as (i) the willful and continuing failure or refusal to render services in accordance with his obligations, (ii) gross negligence, dishonesty, or breach of fiduciary duty, (iii) fraud, embezzlement or substantial disregard of the rules or policies of the Company, (iv) acts which would tend to generate significant adverse publicity toward the Company, (v) the commission of a felony, or (vi) breach of the terms of the Proprietary Information, Inventions and Non-Competition Agreement between the Company and Mr. Fish. “Good Reason” is defined in the Executive Agreement as including a material diminution in the nature or scope of Mr. Fish’s responsibilities, duties or authority. The Executive Agreement is attached at Exhibit 10.1 to this report and is incorporated herein by reference.

On March 26, 2007, the Company issued a press release regarding the appointment of Mr. Fish. The press release is attached as Exhibit 99.1 to this report and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d)  Exhibits

The following Exhibits are filed as part of this report:

Exhibit No. Description

10.1 Executive Agreement, dated March 26, 2007, between the Company and Murray Fish

99.1 Press Release dated March 15, 2007

 

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.

	DATAWATCH CORPORATION
Date: March 26, 2007
	By: /s/ Robert W. Hagger
	Name: Robert W. Hagger
	Title:   President and Chief Executive Officer

EX-10.1

EXHIBIT 10.1

March 26, 2007

Mr. Murray Fish

3 Wabanaki Way

Andover, MA 01810

Dear Murray:

The purpose of this letter is to memorialize the terms of your eligibility for severance with Datawatch Corporation (“the Company”) in the event that you are involuntarily terminated by the Company without Cause (as defined in Paragraph 3) or if you terminate your employment for Good Reason (as defined in Paragraph 2).

1.As an at-will employee, either you or the Company may terminate your employment at any time for any or no reason with or without notice. Neither this letter nor its terms constitute a contract for continued employment or a contract for a specific term of employment. Instead, this letter sets forth the terms of our agreement with respect to your eligibility for severance.

2.In the event that you voluntarily terminate your employment with the Company at your own election and without Good Reason, you shall be entitled to no severance. For the purpose of this Agreement, “Good Reason” is defined as a material diminution in the overall scope of your duties and responsibilities; provided, however, that the transfer of certain job responsibilities, or the assignment to others of your duties and responsibilities while you are out of work due to a disability or on a leave of absence for any reason, shall not constitute a material diminution in the overall scope of your duties and responsibilities as set forth in this Section.

3.In the event that the Company terminates your employment for “Cause,” you shall be entitled to no severance. Termination by the Company shall constitute a termination for Cause under this Paragraph 3 if such termination is for one or more of the following reasons:

(a)the willful and continuing failure or refusal by you to render services to the Company in accordance with your obligations to the Company;

(b)gross negligence, dishonesty, breach of fiduciary duty or breach of the terms of any other agreements executed in connection herewith;

(c)the commission by you of an act of fraud, embezzlement or substantial disregard of the rules or policies of the Company;

(d)acts which, in the judgment of the Board of Directors, would tend to generate significant adverse publicity toward the Company;

(e)the commission, or plea of nolo contendere, by you of a felony; or

(f)a breach by you of the terms of the Proprietary Information, Inventions and Non-Competition Agreement executed by you.

4.In the event that the Company terminates your employment for any reason other than those stated in Paragraph 3 above or if you terminate your employment for Good Reason as defined in Paragraph 2, and you sign a comprehensive release in the form, and of a scope, acceptable to the Company (the “Release”), the Company will pay you severance payments in equal monthly installments at your then monthly base salary for six months following your termination (the “Severance Period”). Such payments shall be made in accordance with the Company’s customary payroll practices and shall be subject to all applicable federal and state withholding, payroll and other taxes.

If you breach your post-employment obligations under your Proprietary Information, Inventions and Non-Competition Agreement, the Company may immediately cease payment of the severance. This cessation of severance shall be in addition to, and not as an alternative to, any other remedies in law or in equity available to the Company, including the right to seek specific performance or an injunction.

5.The terms of this agreement constitute the entire understanding relating to your employment and supersede all agreements, written or oral, made prior to the date hereof between you and the Company relating to your employment with the Company; provided, however, that nothing herein shall be deemed to limit or terminate the provisions of the Proprietary Information, Inventions and Non-Competition Agreement executed by you or in any manner alter the terms of any stock option agreement entered into between you and the Company.

6.This Agreement, the employment relationship contemplated herein and any claim arising from such relationship, whether or not arising under this Agreement, shall be governed by and construed in accordance with the internal laws of Massachusetts, without giving effect to the principles of choice of law or conflicts of law of Massachusetts and this Agreement shall be deemed to be performable in Massachusetts. Any claims or legal actions by one party against the other arising out of the relationship between the parties contemplated herein (whether or not arising under this Agreement) shall be commenced or maintained in any state or federal court located in Massachusetts, and you hereby submit to the jurisdiction and venue of any such court.

7.No waiver by either party of any breach by the other or any provision hereof shall be deemed to be a waiver of any later or other breach thereof or as a waiver of any other provision of this Agreement. This Agreement and its terms may not be waived, changed, discharged or terminated orally or by any course of dealing between the parties, but only by an instrument in writing signed by the party against whom any waiver, change, discharge or termination is sought. No modification or waiver by the Company shall be effective without the consent of the Board of Directors in office at the time of such modification or waiver.

8.You acknowledge that the services to be rendered by you to the Company are unique and personal in nature. Accordingly, you may not assign any of your rights or delegate any of your duties or obligations under this Agreement. The rights and obligations of the Company under this

Agreement may be assigned by the Company and shall inure to the benefit of, and shall be binding upon, the successors and assigns of the Company.

If this letter correctly states the understanding we have reached, please indicate your acceptance by countersigning the enclosed copy and returning it to me.

Very truly yours,

DATAWATCH CORPORATION

____________________________

Robert Hagger

President and Chief Executive Officer

YOU REPRESENT THAT YOU HAVE READ THE FOREGOING AGREEMENT, THAT YOU FULLY UNDERSTAND THE TERMS AND CONDITIONS OF SUCH AGREEMENT AND THAT YOU ARE VOLUNTARILY EXECUTING THE SAME.

ACCEPTED:

______________________________________

Murray P. Fish     Date

EX-99.1

EXHIBIT 99.1

Datawatch Names Murray P. Fish as Chief Financial Officer and Vice President of Finance

New CFO brings strengths in leadership, corporate finance and regulatory compliance

Chelmsford, Mass. - (PRNewswire) - March 26, 2007 - Datawatch Corporation (NASDAQ-CM:DWCH), a leader in the rapidly growing Enterprise Information market, today announced that it has appointed Murray P. Fish as Chief Financial Officer, Vice President of Finance, Treasurer and Assistant Secretary, effective immediately. Mr. Fish’s responsibilities include managing the Company’s financial growth, driving corporate governance and scaling continued operations.

Mr. Fish replaces Douglas Zaccaro who has served as interim CFO since February 1, 2007. Mr. Zaccaro will continue with the Company in a consultancy role until at least May 15, 2007.

“We are very pleased to have Murray join the Datawatch team. We sought an experienced finance practitioner with extensive background in financial, operational management, and regulatory compliance roles in public technology companies to help Datawatch manage its next stage of growth,” said Datawatch President and CEO Robert W. Hagger. “Murray’s expertise in corporate governance, mergers and acquisitions, and developing cost containment strategies will bring the institutional process, financial controls and reporting discipline needed to ensure the continued stability of the Company,” added Mr. Hagger.

“Mr. Fish brings over 30 years of experience in finance, and possesses particular expertise in corporate strategy, financial controls, and SEC reporting requirements. Most recently he served as CFO of Cymfony, Inc. a private, venture-backed business intelligence company recently acquired by TNS, a British company with revenues of $2 billion. Prior to Cymfony, Mr. Fish was principal consultant at M.P. Fish Associates, where he specialized in mergers and acquisitions, and provided financial consulting to large public and private organizations. Other positions include the roles of CFO and Director at Network-1 Security Systems, CFO and Director at RealWorld Corporation, and Vice President and Controller at Goldman Financial Group. He began his career at Arthur Anderson LLP. A Certified Public Accountant (CPA), Mr. Fish holds a Bachelor of Science degree in Business Administration from Northeastern University, and an MBA from Babson College.

“Datawatch is a mature worldwide organization with innovative technology, a solid customer base, a passionate team of professionals, and a pipeline of new products for 2007 and beyond,” said Mr. Fish. "It's a privilege to be joining the Company and I look forward to helping Datawatch achieve its tremendous market potential as we continue to grow the Company worldwide."

ABOUT DATAWATCH CORPORATION

Datawatch Corporation is a leader in the rapidly growing Enterprise Information Management market space. By providing solutions that build on a Service Oriented Architecture (SOA) framework and its Monarch report and data mining technology, Datawatch allows organizations to archive, access, enhance, analyze and deliver information from wherever it resides inside or outside the enterprise to solve business problems. Datawatch products are used in more than 20,000 companies, institutions and government agencies worldwide. Datawatch corporate headquarters are located at 271 Mill Road, Quorum Office Park, Chelmsford, MA 01824. For more information, visit Datawatch at www.datawatch.com

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any such statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties that may cause actual results to differ materially from expectations. The factors that could cause actual future results to differ materially from current expectations include the following: risks associated with the uncertainty of the current economic climate; risks associated with fluctuations in quarterly operating results; Datawatch's dependence on its principal products; risks associated with international sales; risks associated with distributor sales; risks associated with acquisitions; an unfavorable result in any litigation; market acceptance of new products; dependence on the introduction of new products and possible delays in those introductions. Further information on factors that could cause actual results to differ from those anticipated is detailed in various publicly-available documents, which include, but are not limited to, filings made by Datawatch from time to time with the Securities and Exchange Commission, including but not limited to, those appearing in the Company's Form 10-K for the year ended September 30, 2006 and Form 10-Q for the quarter ended December 31, 2006. Any forward-looking statements should be considered in light of those factors.

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Datawatch contact:

Lisa G. Kilpatrick, Marketing Communications Manager

lisa_kilpatrick @datawatch.com

Phone (978) 441-2200, ext. 8240

Fax: (978) 453-4443