Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Control and Procedures
Based on an evaluation under the supervision and with the participation of our management, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were effective as of December 31, 2022 to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework). Based on our assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2022 to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles.
In designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints, and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Changes in Internal Control Over Financial Reporting
There have been no other changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) of the Exchange Act) that occurred during the fourth quarter of 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Effective January 1, 2023, the Compensation Committee of the Board of Directors (the “Compensation Committee”) approved the grant of performance stock units (“PSU”) pursuant to a Performance Stock Unit Award Grant Notice and Performance Stock Unit Award Agreement (the “PSU Award Agreement”) under the 2018 Plan to Pat Goepel, John Pence and Eyal Goldstein payable in the form of RSUs. A form of the PSU Award Agreement is attached to this annual report as Exhibit 10.13. The PSU Award Agreements set target and maximum levels of awards based on the achievement of Performance Metrics (as defined in the PSU Award Agreement) through the Performance Period (as defined in the PSU Award Agreement). The RSUs granted pursuant to the PSU Award Agreement will vest over a three year period with one-third vesting on the Final Payment Date (as defined in the PSU Award Agreement) and each of the two years thereafter.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
None.
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PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Except as set forth below, the information required under this Item is incorporated by reference to the information set forth in our definitive proxy statement for our 2023 annual meeting of shareholders under the headings “Item 1 – Election of Directors and Other Matters.”
Code of Ethics
The Company has adopted a code of ethics entitled “Code of Business Conduct and Ethics” that applies to directors, officers and employees. It may be accessed through the “Corporate Governance” section of the Company’s website at investor.asuresoftware.com/corporate-governance . Asure also elects to disclose the information required by Form 8-K, Item 5.05, “Amendments to the Registrant’s Code of Ethics, or Waiver of a Provision of the Code of Ethics,” through the Company’s website, and such information will remain available on this website for at least a twelve month period. A copy of the “Code of Business Conduct and Ethics” is available in print to any stockholder who requests it.
ITEM 11. EXECUTIVE COMPENSATION
The information required under this Item is incorporated by reference to the information set forth in our definitive proxy statement for our 2023 annual meeting of shareholders under the headings “Executive Compensation,” “Equity Compensation Plan Information” and “Non-Employee Director Compensation Table.”
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required under this Item is incorporated by reference to the information set forth in our definitive proxy statement for our 2023 annual meeting of shareholders under the heading “Security Ownership of Certain Beneficial Owners and Management.”
ITEM 13. CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
The information required under this Item is incorporated by reference to the information set forth in our definitive proxy statement for our 2023 annual meeting of shareholders under the heading “Approval of Transactions with Related Parties.”
ITEM 14. PRINCIPAL ACCOUNTANT AND SERVICES
The information required under this Item is incorporated by reference to the information set forth in our definitive proxy statement for our 2023 annual meeting of shareholders under the heading “Item 2 – Ratification of Independent Registered Public Accounting Firm.”
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PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a) The following documents are filed as a part of this Annual Report on Form 10-K:
(1) Financial Statements:
The Financial Statements required by this item are submitted in Part II, Item 8 of this report.
(2) Financial Statement Schedules:
All schedules are omitted because they are not applicable or the required information is shown in the Financial Statements or in the notes thereto.
(3) Exhibits:
EXHIBIT NUMBER DESCRIPTION
2.1
Asset Purchase Agreement among Asure Payroll Tax Management LLC, Payroll Tax Management, Inc., Financial Business Group Holdings, and Alden J. Blowers, dated as of July 1, 2020 (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed July 13, 2020).
2.2
Asset Purchase Agreement, among Evolution Payroll Processing LLC, USA Processing, Inc., Mary VanWyck-Fiannaca and Frank Fiannaca, dated as of September 30, 2021 (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed October 6, 2021).
2.3
Asset Purchase Agreement, among Evolution Payroll Processing LLC, Paydata Payroll Systems, Inc., Summit Trahan Revocable Trust data 2/10/09, as amended and restated U/A/D 6/12/12, Michael J. Trahan, and Michael J. Trahan, as Seller Representative, dated as of September 30, 2021 (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed October 6, 2021).
3.1
Restated Certificate of Incorporation (Previously filed as an Exhibit to the Company’s Quarterly Report on Form 10-Q (File No. 1-34522), filed May 11, 2017).
3.2
Certificate of Amendment to Certificate of Incorporation (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed June 2, 2020).
3.3
Third Amended and Restated Bylaws (Previously filed as an Exhibit to the Company’s Quarterly Report on Form 10-Q (File No. 1-34522), filed November 9, 2018).
3.4
Amendment to No. 1 to Third Amended and Restated Bylaws (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed April 6, 2020).
4.1
Specimen Certificate for the Common Stock (Previously filed as Exhibit 4.1 to the Company’s Registration Statement on Form S-3 (File No. 1-34522), filed December 13, 2012).
4.2
Third Amended and Restated Rights Agreement, dated effective October 28, 2022 between Asure Software, Inc. and American Stock Transfer & Trust Company (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed June 3, 2022).
4.3
Letter Agreement from Patrick Goepel relating to forfeiture of option rights (Previously filed as an Exhibit to the Company’s Annual Report on Form 10-K (File No. 1-34522), filed March 30, 2012).+
4.4
Stock Option Agreement for Patrick Goepel (Previously filed as an Exhibit to the Company’s Annual Report on Form 10-K (File No. 1-34522), filed March 30, 2012).+
4.5
Description of the Company’s securities registered pursuant to Section 12 of the Securities Exchange Act of 1934.*
10.1
Stock Purchase Agreement dated September 25, 2009 with Patrick Goepel (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K/A (File No. 1-34522), filed September 28, 2009).
10.2
Amended and Restated Employment Agreement dated July 2, 2011 with Patrick Goepel (Previously filed as an Exhibit to the Company’s Annual Report on Form 10-K (File No. 1-34522), filed March 30, 2012).
10.3
Employee Stock Purchase Plan, as amended on May 27, 2020 (Previously incorporated to the Company’s Proxy Statement (File No. 1-34522) for its Annual Meeting of Shareholders held on May 27, 2020).+
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EXHIBIT NUMBER DESCRIPTION
10.4
Form of Indemnification Agreement (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed December 21, 2017).
10.5
Executive Change in Control Severance Plan (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed December 21, 2017).+
10.6
Asure Software, Inc. 2018 Incentive Award Plan, as amended on May 29, 2019, May 27, 2020 and May 31, 2022 (Previously filed as an Exhibit to the Company’s Quarterly Report on Form 10-Q (File No. 1-34522), filed May 11, 2020).+
10.7
Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the 2018 Incentive Award Plan (Previously filed as an Exhibit to the Company’s Annual Report on Form 10-K (File No. 1-34522), filed March 11, 2021).+
10.8
Form of Stock Option Grant Notice and Stock Option Agreement under the 2018 Incentive Award Plan (Previously filed as an Exhibit to the Company’s Annual Report on Form 10-K (File No. 1-34522), filed March 11, 2021).+
10.9
Loan and Security Agreement, dated as of September 10, 2021, among Asure Software, Inc., and Structural Capital Investments III, LP, Ocean II PLO LLC as administrative and collateral agent and the other lenders that are or become parties thereto (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed September 16, 2021).
10.10
Secured Term Promissory Note, dated as of September 10, 2021, between Asure Software, Inc. and Ocean PLO LLC (Previously filed as an Exhibit to the Company’s Current Report on Form 8-K (File No. 1-34522), filed September 16, 2021).
10.11
Lease between 405 Colorado Holdings LP and Asure Software Inc., dated February 4, 2022. (Previously filed as an Exhibit to the Company's Annual Report on Form 10-K (File No. 1-34522), filed March 14, 2022)
10.12
Amendment No. 1 to Loan and Security Agreement between Structural Capital Investments III, LP Ocean II PLO LLC and Asure Software, Inc. effective as of April 1, 2022 (Previously filed as an Exhibit to the Company's Quarterly Report on Form 10-Q (File No. 1-34522), filed August 8, 2022).
10.13
Form of Performance Stock Unit Award Grant Notice and Performance Stock Unit Award Agreement under the Company’s 2018 Incentive Award Plan+*
21.1
Subsidiaries of the Company*
23.1
Consent of Marcum LLP*
31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
31.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
32.1
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished, not filed)**
32.2
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished, not filed)**
101 The following materials from Asure Software, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2022, formatted in Inline XBRL: (1) the Consolidated Balance Sheets, (2) the Consolidated Statements of Comprehensive Loss, (3) the Consolidated Statements of Changes in Stockholders’ Equity, (4) the Consolidated Statements of Cash Flows, and (5) Notes to Consolidated Financial Statements (filed herewith).
104 The cover page from the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, formatted as Inline XBRL and contained in Exhibit 101 (filed herewith).
+ Indicates management contract or compensatory plan, contract or arrangement in which directors or executive officers participate.
* Filed herewith.
** Furnished herewith.
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ITEM 16. FORM 10-K SUMMARY
None.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
ASURE SOFTWARE, INC.
Date: February 27, 2023 By: /s/ PATRICK GOEPEL
Patrick Goepel
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the date indicated.
Signed Title Date
/s/ PATRICK GOEPEL Chief Executive Officer, Chairman of the Board of Directors February 27, 2023
Patrick Goepel Principal Executive Officer
/s/ JOHN PENCE Chief Financial Officer February 27, 2023
John Pence Principal Financial and Accounting Officer
/s/ DANIEL GILL Lead Independent Director February 27, 2023
Daniel Gill
/s/ BENJAMIN ALLEN Director February 27, 2023
Benjamin Allen
/s/ CARL DREW Director February 27, 2023
Carl Drew
/s/ GRACE LEE Director February 27, 2023
Grace Lee
/s/ BRADFORD OBERWAGER Director February 27, 2023
Bradford Oberwager
/s/ BJORN REYNOLDS Director February 27, 2023
Bjorn Reynolds
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