What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2021-12-20 compared with 2020-12-23 · 197 added, 156 removed, 339 unchanged (51% of the section changed)

Controls and Procedures.

Management’s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our President and Chief Executive Officer (Principal Executive Officer) and our Chief Financial Officer (Principal Financial and Accounting Officer), as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, as ours are designed to do, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Management ’

s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the  

Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our President and Chief Executive Officer (Principal Executive Officer) and our Chief Financial Officer (Principal Financial and Accounting Officer), as appropriate, to allow timely decisions regarding required disclosure.  In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, as ours are designed to do, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As of September 30, 2021, the end of our fiscal year covered by this report, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures.

Based on the foregoing, we concluded that our disclosure controls and procedures were effective as of the end of the period covered by this annual report.

Management’s Report on Internal Control over Financial Reporting

Management ’

s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting.

Responsibility estimates and judgments by management are required to assess the expected benefits and related costs of control procedures.

The objectives of internal control include providing management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management’s authorization and recorded properly to permit the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States.

Our management assessed the effectiveness of our internal control over financial reporting as of September 30, 2020.

In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in the 2013 Internal Control-Integrated Framework .

Our management assessed the effectiveness of our internal control over financial reporting as of September 30, 2021.  In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in the 2013 Internal Control-Integrated Framework .

Our management has concluded that as of September 30, 2021, our internal control over financial reporting is effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

1 unchanged sentence

Our management reviewed the results of its assessment with our Board of Directors.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.

Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to a permanent exemption from the internal control audit requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

18 unchanged sentences

Director, President and Chief Executive Officer

Windhausen 

Chief Financial Officer (5)

3 unchanged sentences

Independent director.

Downey was appointed as our Chief Financial Officer and Treasurer effective July 1, 2019, following the resignation of our former Chief Financial Officer, Carole Tyner.

Windhausen was appointed as our Chief Financial Officer and Treasurer effective November 30, 2021, following the resignation of our former Chief Financial Officer, Mark G.

Joni Kahn has been a member of our Board of Directors since April 2012.

6 unchanged sentences

From 2007 to 2012, Ms.

Kahn was Vice President of Services for HP’s Enterprise Security Software group.

From 2005 to 2007, Ms.

2 unchanged sentences

From 2002 to 2005, Ms.

Kahn was the Senior Group Vice President for worldwide professional services for Business Objects, a business intelligence and analytics software maker based in San Jose, where she led the applications and services division that supported that company's transformation from a products company to an enterprise solutions company.

Kahn was the Senior Group Vice President for worldwide professional services for Business Objects, a business intelligence and analytics software maker based in San Jose, CA, where she led the applications and services division that supported that company's transformation from a products company to an enterprise solutions company.

Business Objects was acquired by SAP in 2007.

1 unchanged sentence

Kahn was a Member of the Board of Directors for MapInfo, a global location intelligence solutions company.

She was a member of MapInfo’s Audit Committee and the Compensation Committee.

MapInfo was acquired by Pitney Bowes in 2007.

From 1993 to 2000, Ms.

Kahn was an Executive Vice President and Partner of KPMG Consulting, where she helped grow the firm’s consulting business from $700 million to $2.5 billion.

Kahn received her B.B.A in Accounting from the University of Wisconsin – Madison.

She was a member of MapInfo’s Audit Committee and the Compensation Committee.

MapInfo was acquired by Pitney Bowes in 2007. From 1993 to 2000, Ms.

Kahn was an Executive Vice President and Partner of KPMG Consulting, where she helped grow the firm’s consulting business from $700 million to $2.5 billion.

Kahn received her B.B.A in Accounting from the University of Wisconsin –

Kahn brings extensive leadership experience to our Board and our Audit Committee as an experienced senior executive.

Kahn has over thirty years of executive level managerial, operational, and strategic planning experience leading world-class sales, service and support technology organizations.

Her service on prior boards also provides financial and governance experience.

Kahn has over thirty years of executive level managerial, operational, and strategic planning experience leading world-class sales, service and support technology organizations. Her service on prior boards also provides financial and governance experience.

Kahn brings extensive leadership experience to our Board and our Audit Committee as an experienced senior executive.

Kahn has over thirty years of executive level managerial, operational, and strategic planning experience leading world-class service and support technology organizations.

Her service on prior boards also provides financial and governance experience.

The Board of Directors has determined that Ms.

Kahn’s vast experience in the technology industry and finance, as well as her executive leadership, makes her qualified to continue as the Chairperson and member of our Board of Directors.

Kenneth Galaznik has been a member of our Board of Directors since 2006.

Galaznik is the Chairman of the Company’s Audit Committee and serves as a member of the Compensation Committee.

From 2005 to 2016, Mr.

9 unchanged sentences

degree in accounting from The University of Houston.

Galaznik brings extensive experience to our Board and our Audit Committee as an experienced senior executive, a financial expert, and as chief financial officer of a publicly held company.

Galaznik brings extensive experience to our Board and our Audit Committee as an experienced senior executive, a financial expert, and as a chief financial officer of a publicly-held company.

The Board of Directors has determined that Mr.

Galaznik’s deep experience in finance and his executive leadership make him qualified to continue as a member of our Board of Directors.

Scott Landers has been a member of our Board of Directors since 2010.

Landers is the Chair of the Nominating and Corporate Governance Committee and serves as a member of the Audit and Compensation Committees.

Landers was named President and Chief Executive Officer of Monotype Imaging Holdings, Inc.

on January 1, 2016 after serving as the company’s Chief Operating Officer since early 2015 and its Chief Financial Officer, Treasurer and Assistant Secretary since joining Monotype in July 2008.

Effective October 11, 2019, Monotype was acquired by HGGC and is now a privately-owned company and is a leading provider of typefaces, technology and expertise that enable the best user experiences and sure brand integrity.

Landers was President and Chief Executive Officer of Monotype Imaging Holdings, Inc.

from 2016 to July 2021.

He previously held the positions of Chief Operating Officer and Chief Financial Officer from 2008 to 2015. Monotype is a leading provider of fonts and font software, and the company was under both public and private ownership during his tenure.

Prior to joining Monotype, from September 2007 until July 2008, Mr.

1 unchanged sentence

From 1997 until September 2007, Mr.

Landers held several senior finance positions, including Vice President of Finance and Administration, at MapInfo, a publicly held company which was acquired by Pitney Bowes in April 2007.

Earlier in his career, Mr.

Landers held several senior finance positions, including Vice President of Finance and Administration at MapInfo, a publicly held company which was acquired by Pitney Bowes in April 2007. Earlier in his career, Mr.

Landers was a Business Assurance Manager with Coopers & Lybrand.

Landers holds a bachelor's degree in accounting from Le Moyne College in Syracuse, N.Y.

and a master’s degree in business administration from The College of Saint Rose in Albany, N.Y.

Landers brings extensive experience to our Board and our Audit Committee as an experienced senior executive, a financial expert, and as chief executive officer and a chief financial officer of a publicly-held company.

and a master’s degree in business administration from The College of Saint Rose in Albany, N.Y.

Landers brings extensive experience to our Board and our Audit Committee as an experienced senior executive, a financial expert, and a chief executive officer and a chief financial officer of a publicly-held company.

Our Board of Directors has determined that Mr.

Lander’s financial skills, public-company experience, strategic business acumen and executive leadership make him a qualified to continue as a member of our Board of Directors.

Michael Taglich has been a member of our Board of Directors since 2013.

Lander’s financial skills, public-company experience, strategic business acumen and executive leadership make him qualified to continue as a member of our Board of Directors. 

Michael Taglich  has been a member of our Board of Directors since 2013.

He is the Chairman and President of Taglich Brothers, Inc., a New York City based securities firm which he co-founded in 1992 with his brother Robert Taglich.

4 unchanged sentences

Michael Taglich brings extensive professional experience which spans various aspects of senior management, including finance, operations and strategic planning.

Taglich has more than 30 years of financial industry experience and served on his first public company board over 20 years ago.

Taglich has more than 30 years of financial industry experience and served on his first public company board over 20 years ago.

Our Board of Directors has determined that Mr.

Taglich’s executive strategic business skills in both private and public companies, as well as his experience leading and advising high-growth companies, make him a qualified to continue as a member of our Board of Directors.

Taglich’s executive strategic business skills in both private and public companies, as well as his experience leading and advising high-growth companies, make him qualified to continue as a member of our Board of Directors.

Roger Kahn has been a member of our Board of Directors since December 2017.

8 unchanged sentences

Our Board of Directors has determined that Mr.

Kahn’s vast experience as a successful entrepreneur in the technology space, as well as his technical and leadership acumen, make him qualified to continue as a member of our Board of Directors.

Downey has been our Executive Vice President and Chief Financial Officer and Treasurer since July 2019.

Downey comes to Bridgeline with more than 25 years of executive experience, including more than 15 years as a CFO and COO at several public and privately-held companies in the technology, private equity, financial services and professional services industries.

Downey has extensive accounting, capital markets structuring, risk, treasury, M&A due diligence, technology enhancements, and overall operational and management experience.

Prior to joining Bridgeline Digital, Inc., Mr.

Downey served as a consultant and Director of Accounting & Transaction Services at MorganFranklin Consulting from 2015 to 2019.

He was the global CFO and COO at Algodon Group, a private equity firm from 2014 to 2015 and CFO and COO and Treasurer at Dahlman Rose, Tullett Prebon and Commerzbank Securities from 2000 through 2014.

He started his career at Coopers and Lybrand and holds a B.B.A.

in Accounting from Iona College – Hagan School of Business and is a member of the American Institute of Certified Public Accountants and New York State Society of Certified Public Accountants.

There are no family relationships between any of the directors and the Company’s executive officers, including between Ms.

Kahn’s vast experience as a successful entrepreneur in the technology space, as well as his technical and leadership acumen, make him qualified to continue as a member of our Board of Directors.

Thomas Windhausen has served as the Company’s Chief Financial Officer and Treasurer since November 2021.

Prior to that he served as the Company’s VP of Finance since October 2021.

Windhausen comes to Bridgeline with more than 20 years of experience in both public accounting and industry.

Prior to joining the Company, Mr.

Windhausen served as a VP of Finance with Comtech Telecommunications Corp.

from July 2019 to September 2021, and from June 2011 to June 2019, Mr.

Windhausen held various accounting and finance roles with Dealertrack Technologies, Inc., and its successor Cox Automotive Inc. 

Windhausen started his career at PricewaterhouseCoopers, where he spent more than 10 years.

He received his Bachelor’s of Science degree in Accounting from Le Moyne College in Syracuse, N.Y.

and he is a member of the American Institute of Certified Public Accountants and New York State Society of Certified Public Accountants.

There are no family relationships between any of the directors and the Company’s executive officers, including between Ms.

Joni Kahn and Mr.

Roger Kahn, the Company’s President and Chief Executive Officer.

Section 16(A) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) requires the Company’s executive officers, directors and persons who beneficially own more than 10% of a registered class of the Company’s equity securities (collectively, the “Reporting Persons”) to file certain reports regarding ownership of, and transactions in, the Company’s securities with the Securities and Exchange Commission (the “SEC”).

Section 16(a) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) requires the Company’s executive officers, directors and persons who beneficially own more than 10% of a registered class of the Company’s equity securities (collectively, the “Reporting Persons”) to file certain reports regarding ownership of, and transactions in, the Company’s securities with the Securities and Exchange Commission (the “SEC”).

These officers, directors and stockholders are also required by SEC rules to furnish the Company with copies of all Section 16(a) reports that they file with the SEC.

17 unchanged sentences

A copy of such charter is available on the Company's website, www.bridgeline.com .

During Fiscal 2020, the Audit Committee met four times.

During Fiscal 2021, the Audit Committee met five times.

Each member of the Audit Committee attended each such meeting.

The Chairman of the Audit Committee was present at all meetings.

Audit Committee Financial Expert.

11 unchanged sentences

A copy of such charter is available on the Company's website, www.bridgeline.com .

During Fiscal 2020, the Compensation Committee met five times.

During Fiscal 2021, the Compensation Committee met four times and acted three times by unanimous written consent.

Nominating and Corporate Governance Committee

11 unchanged sentences

Principal Position

Compensation (2)

President and Chief

Executive Officer

Executive Vice President

Chief Financial Officer and Treasurer

Carole Tyner (1)

Former Chief Financial Officer

(1) Carole Tyner resigned as Chief Financial Officer on August 31, 2019.

Effective July 1, 2019, Mark Downey was appointed as Executive Vice President, Chief Financial Officer and Treasurer.

(2) Amounts paid to Carole Tyner in fiscal 2019 represented severance of $110,000, unused vacation of $5,077 and COBRA of $1,112.

President and Chief Executive Officer

Executive Vice President and Chief Financial Officer

and Treasurer

Employment Agreements

On August 24, 2015, Mr.

Roger "Ari" Kahn joined Bridgeline Digital, Inc.

(the "Company") as the Company's Chief Operating Officer.

Roger “Ari”

Kahn joined Bridgeline Digital, Inc.

(the “Company”) as the Company’s Chief Operating Officer.

On December 1, 2015, Mr.

2 unchanged sentences

Kahn as President and Chief Executive Officer, effective May 10, 2016.

Kahn's employment agreement was amended and reported on Form 8-K filed with the Securities and Exchange Commission on May 13, 2016.

In furtherance of Mr.

Kahn's employment with the Company, a new employment agreement was entered into on September 13, 2019 by and between the Company and Mr.

Kahn’s employment agreement was amended and reported on Form 8-K filed with the SEC on May 13, 2016.

A new employment agreement was entered into on September 13, 2019 by and between the Company and Mr.

The principal change to Mr.

Kahn's employment agreement is that it will automatically renew each fiscal year unless the Company provides written notice of its intent not to renew such employment agreement at least sixty (60) days in advance of the Company's fiscal year rather than the employment agreement only renewing upon notice from the Company.

On June 28, 2019, Ms.

Carole Tyner resigned from her position of Chief Financial Officer of Bridgeline Digital, Inc.

(the "Company") to pursue new professional opportunities.

Tyner's departure on August 31, 2019, she received a lump sum separation payment equivalent to six-months base salary, and further, she continued to receive COBRA health insurance continuation benefits with the Employer portion of the premiums paid by the Company through February 28, 2020.

Effective July 1, 2019, Mark G.

Downey was appointed by the Company's Board of Directors as Executive Vice President, Chief Financial Officer and Treasurer of the Company.

Kahn’s employment agreement, is that it will automatically renew each fiscal year unless the Company provides written notice of its intent not to renew such employment agreement at least sixty (60) days in advance of the Company’s fiscal year rather than the employment agreement only renewing upon notice from the Company.

In furtherance of Mr.

Kahn’s employment with the Company, a first amendment to Mr.

Kahn, which amended the September 12, 2019 employment agreement, entitles Mr.

Kahn to an annual salary of $330,000 starting on the date of the amendment and an annual bonus of $137,500.

On November 30, 2021, Mr.

Downey resigned from his position of Chief Financial Officer of Bridgeline Digital, Inc.

(“Bridgeline”

or the “Company”) to pursue new professional opportunities.

Downey will continue to provide transition services to the Company as a consultant until January 30, 2022.

Effective November 30, 2021, Thomas R.

Windhausen was appointed by the Company’s Board of Directors as Chief Financial Officer and Treasurer of the Company. 

The Company and Mr.

Downey entered into an employment agreement (the "Employment Agreement"), effective July 1, 2019 through September 30, 2020, whereby he will receive two-hundred and forty thousand dollars base salary and the ability to earn a bi-annual incentive bonus of thirty thousand dollars.

Downey may also participate in such equity-based and cash-based incentive programs as the Company may from time to time make available to its executive officers, in accordance with the terms and conditions of such programs, as well as, the Company's other applicable employee benefits plans and programs.

His Employment Agreement, which has been renewed through September 2021, also provides that in the event Mr.

Downey's employment is terminated by the Company without cause or if the Company terminates his employment for good reason, he is entitled to receive severance benefits.

Windhausen entered into an employment agreement (the “Employment Agreement”), effective November 30, 2021 through September 30, 2022, unless extended by mutual agreement of the Company and Mr.

Windhausen, whereby he will receive an two-hundred and forty thousand dollars base salary and the ability to earn a bi-annual incentive bonus of twenty-two thousand five hundred dollars, which incentive bonus may be awarded to Mr.

Windhausen at the discretion of the Company’s Compensation Committee.

The Employment Agreement also provides that Mr.

Windhausen will be eligible to participate in all other employee benefits plans and programs, and, in the event Mr.

Windhausen’s employment is terminated by the Company without cause, he is entitled to receive severance benefits.

The foregoing descriptions of the material terms of the Employment Agreement by and between the Company and Mr.

Downey do not purport to be complete descriptions and are qualified in their entirety by reference to the Employment Agreement, which is filed as Exhibit 10.1 on Form 8-K.

Windhausen do not purport to be complete descriptions and are qualified in their entirety by reference to the Employment Agreement, which is filed as Exhibit 10.29 on to this Form 10-K.

There are no family relationships between Mr.

Downey and any director or executive officer of the Company.

Windhausen and any director or executive officer of the Company.

Outstanding Equity Awards at Fiscal 2021 Year-End

2 unchanged sentences

Unexercisable (1)

Roger Kahn (1)

Shares vest in equal installments upon the anniversary date of the grant over three years.

5 unchanged sentences

Committee Chair Bonus.

The Chair of the Board of Directors receives an additional annual fee of $15,000.

The Chair of the Audit Committee receives an additional annual fee of $10,000.

20 unchanged sentences

Huntington, NY 11743

All current executive officers and directors as a group

Holders of Series C Preferred are entitled to vote on all matters presented to our stockholders on an as-converted basis.

 All current executive officers and directors as a group

Holder of Series C Preferred are entitled to vote on all matters presented to our stockholders on an as-converted basis.

Each share of Series C Preferred Stock is convertible, at the option of each respective holder, into approximately 111.11 shares of Common Stock.

7 unchanged sentences

All current executive officers and directors as a group

Includes 248,805 shares issuable upon the exercise of warrants, and 174 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of December 23, 2020).

Includes 195,662 shares issuable upon the exercise of warrants, and 37,708 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

Also includes 35 shares of Common Stock and 2 shares issuable upon the exercise of warrants owned by Mr.

Taglich’s spouse.

Includes 172 shares issuable upon the exercise of warrants and 5,246 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of December 23, 2020).

Taglich’s spouse.

Includes 172 shares issuable upon the exercise of warrants and 171,481 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

Includes 545 shares of common stock owned by Mr.

Kahn’s spouse.

Includes 146 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of December 23, 2020).

Includes 138 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of December 23, 2020).

Kahn’s spouse.

Includes 37,660 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

Includes 37,660 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

Includes 8 shares of Common Stock owned by Mr.

Lander’s children.

Includes 130 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of December 23, 2020).

Includes 5,824 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of December 23, 2020).

Lander’s children.

Includes 37,664 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

Includes 26,667 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

Includes 348,840 shares of Common Stock subject to currently exercisable options (includes options that will become exercisable within 60 days of September 30, 2021).

We maintain a number of equity compensation plans for employees, officers, directors and other entities and individuals whose efforts contribute to our success.

1 unchanged sentence

Equity Compensation Plan Information

Number of securities

to be issued upon

Weighted average

remaining available

exercise price of

for future issuance

outstanding options,

warrants and rights

compensation plans

Plan category

(excluding securities reflected in column a) (c)

(excluding s ecurities reflected

in column a) (c)

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders (1)

At September 30, 2020, there were 5,492,879 total Warrants outstanding.

At September 30, 2021, there were 1,788,745 total Warrants outstanding.

Stock warrants outstanding at September 30, 2021 are as follows:

13 unchanged sentences

Certain Relationships and Related Transactions, and Director Independence.

Item 404(d) of Regulation S-K requires the Company to disclose any transaction or proposed transaction which occurred since the beginning of the two most recently completed fiscal years in which the amount involved exceeds the lesser of $120,000 or one percent (1%) of the average of the Company’s total assets as of the end of the last two completed fiscal years in which the Company is a participant and in which any related person has or will have a direct or indirect material interest.

A related person is any executive officer, director, nominee for director, or holder of 5% or more of the Company's Common Stock, or an immediate family member of any of those persons.

3 unchanged sentences

Michael Taglich joined the Board of Directors.

Michael Taglich is the Chairman and President of Taglich Brothers, Inc.

a New York based securities firm.

Michael Taglich is the Chairman and President of Taglich Brothers, Inc., a New York based securities firm.

Taglich Brothers, Inc.

acted as placement agents for many of the Company’s private offerings in 2012, 2013, 2014, and 2016.

They were also the placement agent for the Company’s $3 million subordinated debt offering in 2013, the Series A Preferred stock sale in 2015, and Promissory Term Notes in 2018.

As of August 16, 2019, Michael Taglich beneficially owns approximately 10% of Bridgeline stock.

Michael Taglich has also guaranteed $1.5 million in connection with the Company’s out of formula borrowings on its credit facility with Heritage Bank.

In consideration of previous loans made by Michael Taglich to the Company and the personal guaranty for Heritage Bank of Commerce, Mr.

acted as placement agents for many of the Company’s private offerings in 2012, 2013, 2014, and 2016.

They were also the placement agent for the Company’s $3 million subordinated debt offering in 2013, the Series A Preferred Stock sale in 2015, and Promissory Term Notes in 2018.

Michael Taglich has also guaranteed $1.5 million in connection with the Company’s out of formula borrowings on its credit facility with Heritage Bank.

In consideration of previous loans made by Michael Taglich to the Company and the personal guaranty to Heritage Bank of Commerce, Mr.

Taglich has been issued warrants to purchase common stock totaling 1,080 shares at an exercise price of $1,000.00 per share.

In connection with the Company’s private placement completed in November 2016, the Company issued to the Investors warrants to purchase an aggregate total of 4,271 shares of common stock.

Included were warrants to purchase 172 shares of common stock issued to Roger Kahn and warrants to purchase 308 shares of common stock issued to Michael Taglich.

Each warrant to purchase common stock expires five and one-half years from the date of issuance and is exercisable for $175.00 per share beginning six months from the date of issuance, or May 9, 2017.

The warrants expire May 9, 2022.

In connection with previous private offerings and debt issuances, Taglich Brothers, Inc.

were granted placement agent warrants to purchase 4,246 shares of common stock at a weighted average price of $321.00 per share.

In September 2018, the Company sold and issued subordinate promissory notes (the “Promissory Term Notes”) to certain accredited investors (each, a “Purchaser”), pursuant to which it issued to the Purchasers (i) Promissory Term Notes, in the aggregate principal amount of approximately $941,000.

The Promissory Term Notes have an original issue discount of fifteen percent (15%), bear interest at a rate of twelve percent (12%) per annum, and have a maturity date of the earlier to occur of (a) six months from the date of execution of the Purchase Agreement, or (b) the consummation of a debt or equity financing resulting in the gross proceeds to the Company of at least $3.0 million.

was granted Placement Agent Warrants to purchase 4,246 shares of common stock at a weighted average price of $321.00 per share.

The Promissory Term Notes have an original issue discount of fifteen percent (15%), bear interest at a rate of twelve percent (12%) per annum and have a maturity date of the earlier to occur of (a) six months from the date of execution of the Note Purchase Agreement, or (b) the consummation of a debt or equity financing resulting in the gross proceeds to the Company of at least $3.0 million.

Michael Taglich participated in the Note Purchase Agreement in September 2018.

3 unchanged sentences

$40,000 in cash compensation, or five percent (5%) of the net proceeds received by the Company.

In November 2018, the Company engaged Taglich Brothers, on a non-exclusive basis, to perform advisory and investment banking services to identify possible acquisition target possibilities.

Fees for the services were $8,000 per month for three months and $5,000 thereafter, cancellable at any time.

Taglich Brothers could also earn a success fee ranging from $200,000 for a revenue target acquisition of under $5 million up to $1 million for an acquisition target over $200 million.

In connection with the asset purchase of Stantive, Taglich Brothers earned a success fee of $200,000.

Michael Taglich purchased 350 units in the amount of $350,000 of Series C Preferred Stock and associated warrants in the private transaction consummated on March 13, 2019.

Taglich’s purchase was subject to stockholder approval pursuant to Nasdaq Marketplace Rule 5635(c), for which approval by the stockholders of the Company was obtained on April 26, 2019.

In December 2019, the Company engaged Taglich Brothers, on a non-exclusive basis, to perform advisory services to restate the rights and limitations for the Bridgeline Digital, Inc.

Series A Convertible Preferred Stock.

Fees for the services were $21,000.

In connection with the Company’s registered direct completed in February 2021, the Company issued Taglich Brothers 29,084 Investors warrants.

Each warrant to purchase common stock expires five years from the date of issuance and is non-cash exercisable for $3.875 per share beginning six-months from the date of issuance, or February 4, 2021. 

The warrants expire February 4, 2026.

In connection with the Company’s Series D Preferred Stock registered direct and PIPE completed in May 2021, the Company issued Taglich Brothers 53,861 Investors warrants. 

Each warrant to purchase common stock expires five years from the date of issuance and is non-cash exercisable for $2.850 per share beginning six-months from the date of issuance, or May 14, 2021. 

The warrants expire May 12, 2026.

Principal Accounting Fees and Services.

The firm of Marcum LLP acts as our principal independent registered public accounting firm.

They have served as our independent auditors since April 26, 2010.

A representative of Marcum LLP is expected to attend this year's Annual Meeting, and he will have an opportunity to make a statement if he desires to do so.

The firm of PKF O’Connor Davies LLP acts as our principal independent registered public accounting firm.

They have served as our independent auditors since February 27, 2021.

Our previous independent registered public accounting firm was Marcum LLP.

A representative of PKF O’Connor Davies LLP is expected to attend this year's Annual Meeting, and they will have an opportunity to make a statement if they desire to do so.

It is also expected that such representative will be available to respond to appropriate questions.

The table below shows the aggregate fees that the Company paid or accrued for the audit and other services provided by Marcum LLP for the fiscal years ended September 30, 2020 and September 30, 2019.

The Company did not engage its independent registered public accounting firm during either of the fiscal years ended September 30, 2020 or September 30, 2019 for any other non-audit services.

The table below shows the aggregate fees that the Company paid or accrued for the audit and other services provided by PKF O’Connor Davies LLP and Marcum LLP for the fiscal year ended September 30, 2021 and by Marcum LLP for the fiscal year ended September 30, 2020. 

 The Company did not engage its independent registered public accounting firms during either of the fiscal years ended September 30, 2021 or September 30, 2020 for any other non-audit services.

Type of Service

2 unchanged sentences

September 30, 2020

 $261,951

Audit-Related Fees

This category includes fees for the audits of the Company's annual financial statements, review of financial statements included in the Company's Form 10-Q Quarterly Reports and services that are normally provided by the independent auditors in connection with statutory and regulatory filings or engagements for the relevant fiscal years.

PKF O’Connor Davies LLP and Marcum LLP were $219,000 and $42,951, respectively, for fiscal year ended September 30, 2021.

Audit-Related Fees.

This category consists of audits performed in connection with certain acquisitions.

PKF O’Connor Davies LLP and Marcum LLP were $42,500 and $26,044, respectively, for fiscal year ended September 30, 2021.

This category consists of professional services rendered for tax compliance, tax planning and tax advice.

The services for the fees disclosed under this category include tax return preparation, research and technical tax advice.

There were no other fees paid or accrued to Marcum LLP in the fiscal years ended September 30, 2020 or September 30, 2019.

There were no other fees paid or accrued to PKF O’Connor Davies, LLP or Marcum LLP in the fiscal years ended September 30, 2021 or September 30, 2020.

Audit Committee Pre-Approval Policies and Procedures.

4 unchanged sentences

Exhibits and Financial Statement Schedules.

(a) Documents Filed as Part of this Form 10-K

Financial Statements (included in Item 8 of this report on Form 10-K):

Documents Filed as Part of this Form  

1. Financial Statements (included in Item 8 of this report on Form 10-K):

Reports of Independent Registered Public Accounting Firm

– Consolidated Balance Sheets as of September 30, 2020 and 2019

– Consolidated Statements of Operations for the years ending September 30, 2020 and 2019

– Consolidated Statements of Comprehensive Income/(Loss) for the years ending September 30, 2020 and 2019

– Consolidated Statements of Shareholders’ Equity for the years ending September 30, 2020 and 2019

– Consolidated Statements of Cash Flows for the years ending September 30, 2020 and 2019

– Notes to Consolidated Financial Statements

–Consolidated Balance Sheets as of September 30, 2021 and 2020

–Consolidated Statements of Operations for the years ended September 30, 2021 and 2020

–Consolidated Statements of Comprehensive Income/(Loss) for the years ended September 30, 2021 and 2020

–Consolidated Statements of Shareholders’

Equity for the years ended September 30, 2021 and 2020

–Consolidated Statements of Cash Flows for the years ended September 30, 2021 and 2020

–Notes to Consolidated Financial Statements

Financial Statement Schedules

– Not applicable

–Not applicable

Documents listed below, except for documents followed by a parenthetical, are being filed as exhibits.

Documents followed by a parenthetical are not being filed herewith and, pursuant to Rule 12b-32 of the General Rules and Regulations promulgated by the SEC under the Securities Exchange Act of 1934 (the Act), reference is made to such documents as previously filed as exhibits with the SEC.

Documents followed by a parenthetical are not being filed herewith and, pursuant to Rule 12b-32 of the General Rules and Regulations promulgated by the SEC under the Securities Exchange Act of 1934 (the Act), reference is made to such documents as previously filed as exhibits with the SEC.

Exhibit  

Incorporated by Reference

3 unchanged sentences

Amended and Restated Certificate of Incorporation, as amended

Certificate of Designations of the Series A Convertible Preferred Stock

November 4, 2014

1 unchanged sentence

February 17, 2015

Certificate of Designations of the Series B Convertible Preferred Stock

October 19, 2018

1 unchanged sentence

December 14, 2018

Amended and Restated Stock Incentive Plan, as amended

Amendment to the Amended and Restated Bylaws of Bridgeline Digital, Inc., dated September 9, 2021

September 20, 2021

Registration Rights Agreement, dated November 3, 2016, by and between Bridgeline Digital, Inc.

and the Investors party thereto

November 4, 2016

Amended and Restated Stock Incentive Plan, as amended 

July 14, 2014

Exhibit  

Incorporated by Reference

12 unchanged sentences

March 22, 2016

Appendix  B

Form of Common Stock Purchase Warrant issued to Placement Agent

14 unchanged sentences

October 13, 2017

Intercreditor Agreement between Heritage Bank of Comerce and Montage Capital II, L.P dated October 10, 2017

Intercreditor Agreement between Heritage Bank of Commerce and Montage Capital II, L.P dated October 10, 2017

October 13, 2017

7 unchanged sentences

September 11, 2018

Second Amendment to the Loan and Security Agreement between Bridgeline Digital, Inc and Montge Capital II, L.P., dated October 22, 2018

Second Amendment to the Loan and Security Agreement between Bridgeline Digital, Inc and Montage Capital II, L.P., dated October 22, 2018

October 24, 2018

Incorporated by Reference

Share Purchase Agreement, by and between the Company and Woorank SRL., dated February 2, 2021 

February 3, 2021

Form of Securities Purchase Agreement, dated February 4, 2021

February 9, 2021

Form of Placement Agent Warrant, dated February 4, 2021

February 9, 2021

Employment Agreement dated September 13, 2019 between Bridgeline Digital, Inc.

and Roger “Ari” Kahn

September 19, 2018

First Amendment to Roger “Ari” Kahn’s Employment Agreement dated February 25, 2021 

March 2, 2021

Share Purchase Agreement, by and between the Company, Svanaco, Inc., an Illinois corporation, Svanawar, Inc., an Illinois corporation, and Hawk Search Inc., an Illinois corporation, dated May 11, 2021

Employment Agreement dated November 30, 2021 between Bridgeline Digital, Inc.

and Thomas R.

Exhibit  

 Incorporated by Reference

Subsidiaries of the Registrant

Consent of PKF O’Connor Davies, LLP

Consent of Marcum LLP

3 unchanged sentences

CFO Certification, Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

XBRL Instance

XBRL Taxonomy Extension Schema

XBRL Taxonomy Extension Calculation

XBRL Taxonomy Extension Definition

XBRL Taxonomy Extension Labels

XBRL Taxonomy Extension Presentation

Not applicable

Inline XBRL Instance

Inline XBRL Taxonomy Extension Schema

Inline XBRL Taxonomy Extension Calculation

Inline XBRL Taxonomy Extension Definition

Inline XBRL Taxonomy Extension Labels

Inline XBRL Taxonomy Extension Presentation

Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)

Financial Statement Schedules

Not applicable 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

6 unchanged sentences

President and Chief Executive Officer, Director

(Principal Executive Officer)

December 20, 2021

/s/ Thomas R.

Chief Financial Officer

December 20, 2021

(Principal Financial Officer)

/s/Kenneth Galaznik

1 unchanged sentence

Kenneth Galaznik

/s/ Joni Kahn

/s/ Joni Kahn

December 20, 2021

/s/ Scott Landers

/s/ Scott Landers

December 20, 2021

Scott Landers

/s/ Michael Taglich

/s/ Michael Taglich

December 20, 2021

2 unchanged sentences

Description of Document

Employment Agreement dated November 30, 2021 between Bridgeline Digital, Inc.

and Thomas R.

Subsidiaries of the Registrant

Consent of PKF O’Connor Davies, LLP

Consent of Marcum LLP

3 unchanged sentences

CFO Certification, Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

XBRL Instance

XBRL Taxonomy Extension Schema

XBRL Taxonomy Extension Calculation

XBRL Taxonomy Extension Definition

XBRL Taxonomy Extension Labels

XBRL Taxonomy Extension Presentation

Inline XBRL Instance

Inline XBRL Taxonomy Extension Schema

Inline XBRL Taxonomy Extension Calculation

Inline XBRL Taxonomy Extension Definition

Inline XBRL Taxonomy Extension Labels

Inline XBRL Taxonomy Extension Presentation

Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)

*XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures