Sec Form 4 Filing - HALE MARTIN M JR @ FALCONSTOR SOFTWARE INC - 2019-05-21

FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person HALE MARTIN M JR 2. Issuer Name and Ticker or Trading Symbol FALCONSTOR SOFTWARE INC [ FALC] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) X __ Director X __ 10% Owner _____ Officer (give title below) X __ Other (specify below) See Remarks (Last) (First) (Middle) C/O HALE CAPITAL PARTNERS, LP, 17 STATE STREET, SUITE 3230 3. Date of Earliest Transaction (MM/DD/YY) 05/21/2019 (Street) NEW YORK, NY10004 4. If Amendment, Date Original Filed (MM/DD/YY) 6. Individual or Joint/Group Filing (Check Applicable Line) __ X __ Form filed by One Reporting Person _____ Form filed by More than One Reporting Person (City) (State) (Zip)

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned 1.Title of Security (Instr. 3) 2. Transaction Date (MM/DD/YY) 2A. Deemed Execution Date, if any (MM/DD/YY) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Common Stock 70,815 ( 1 ) D Common Stock 05/21/2019 M 1,518,107 ( 2 ) A $ 0.001 359,718,164 ( 3 ) I See Footnote ( 3 ) ( 5 )

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned ( e.g. , puts, calls, warrants, options, convertible securities) 1. Title of Derivative Security (Instr. 3) 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (MM/DD/YY) 3A. Deemed Execution Date, if any (MM/DD/YY) 4. Transaction Code (Instr. 8) 5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5) 6. Date Exercisable and Expiration Date (MM/DD/YY) 7. Title and Amount of Underlying Securities (Instr. 3 and 4) 8. Price of Derivative Security (Instr. 5) 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4) 11. Nature of Indirect Beneficial Ownership (Instr. 4) Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares Warrants ( 2 ) $ 0.001 05/21/2019 M 1,543,630 ( 4 ) ( 4 ) Common Stock 1,518,107 $ 0 0 I See Footnote ( 5 )

Reporting Owners Reporting Owner Name / Address Relationships Director 10% Owner Officer Other HALE MARTIN M JR C/O HALE CAPITAL PARTNERS, LP 17 STATE STREET, SUITE 3230 NEW YORK, NY10004 X X See Remarks Signatures /s/ Martin M. Hale, Jr. 05/21/2019 Signature of Reporting Person Date

Explanation of Responses:

( 1 )Represents shares of vested Restricted Stock previously granted to Martin Hale, Jr. ("MH") under the Falconstor Software, Inc. 2016 Outside Director Equity Compensation Plan in consideration for services performed as a member of the Board of Directors of Falconstor Software, Inc. (the "Issuer"). MH holds these shares for the benefit of Hale Capital Partners, LP ("HCP"). ( 2 )HCP-FVA, LLC ("HCP-FVA"), a Delaware limited liability company, exercised that certain Backstop Warrant, dated February 23, 2018 (the "Backstop Warrant"), to purchase 1,543,630 shares of common stock (the "Common Stock") of the Issuer on a cashless exercise basis with respect to all 1,543,630 shares issuable upon exercise thereof. As a result of such cashless exercise, HCP-FVA received 1,518,107 shares of Common Stock. ( 3 )The shares of Common Stock reported herein are held by HCP-FVA and HCP. ( 4 )The Backstop Warrant is presently exercisable and expires on February 23,2028. ( 5 )MH is the Chief Executive Officer of HCP, the sole member of HCP-FVA. MH is also (i) the sole owner and managing member of Hale Fund Partners, LLC, a Delaware limited liability company ("HFP"), the general partner of HCP and (ii) the sole owner and Chief Executive Officer of Hale Fund Management, LLC, a Delaware limited liability company ("HFM"). HFM is (i) the general partner of Hale Capital Management, LP ("HCM"), the manager of HCP and (ii) the manager of HCP-FVA. Each of MH, HFP, HFM and HCM disclaims beneficial ownership of the securities reported herein, except to the extent of his or its pecuniary interest.

Remarks: MH serves as a director on the board of directors of the Issuer as a representative of HCP-FVA. Accordingly, HCP, HFP, HFM, HCM and HCP-FVA are directors by deputization by virtue of the fact that MH currently serves on the board of directors of the Issuer.

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