Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our Chief Executive Officer and Chief Financial Officer, with the participation of other members of management, have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) under the Exchange Act, as of the end of the period covered by this report. Based on such evaluations, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective (at the reasonable assurance level) to ensure that the information required to be included in this report has been recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and to ensure that the information required to be included in this report was accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, 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. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management, including the Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of September 30, 2020. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework (2013) . Based on such assessment our management has concluded that, as of September 30, 2020, our internal control over financial reporting is effective based on those criteria.
This annual report does not include an attestation report from our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to rules of the SEC that permit emerging growth companies, which we are, to provide only management's report in this annual report.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting during the fiscal year ended September 30, 2020 that materially affected, or which are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information
None.
131
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required by this item is incorporated herein by reference to the Proxy Statement for the 2021 annual meeting of the stockholders, which will be filed with the SEC within 120 days after the end of the fiscal year ended September 30, 2020.
We have adopted a Corporate Code of Conduct that applies to all of our directors, officers and employees. Our Board of Directors expects its members, as well as our officers and employees, to act in accordance with the highest standards of ethical business conduct. The Corporate Code of Conduct, as well as the charters of the, Audit Committee and the Compensation Committee, are available on the Investor Relations section of our website at www.i3Verticals.com under the captions “Investors” and “Corporate Governance.” Upon the written request of any person, we will furnish, without charge, a copy of any of these documents. Requests should be directed to i3 Verticals, Inc., 40 Burton Hills Blvd., Suite 415, Nashville, Tennessee 37215, Attention: Paul Maple, General Counsel. We intend to disclose any amendments to our Corporate Code of Conduct and any waiver from a provision of our code, as required by the SEC, on our website.
Item 11. Executive Compensation
The information required by this item is incorporated herein by reference to the Proxy Statement for the 2021 annual meeting of the stockholders, which will be filed with the SEC within 120 days after the end of the fiscal year ended September 30, 2020.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required by this item is incorporated herein by reference to the Proxy Statement for the 2021 annual meeting of the stockholders, which will be filed with the SEC within 120 days after the end of the fiscal year ended September 30, 2020.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by this item is incorporated herein by reference to the Proxy Statement for the 2021 annual meeting of the stockholders, which will be filed with the SEC within 120 days after the end of the fiscal year ended September 30, 2020.
Item 14. Principal Accounting Fees and Services
The information required by this item is incorporated herein by reference to the Proxy Statement for the 2021 annual meeting of the stockholders, which will be filed with the SEC within 120 days after the end of the fiscal year ended September 30, 2020.
132
PART IV
Item 15. Exhibits and Financial Statement Schedules
(a)(1) Consolidated Financial Statements
See Index to Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
(a)(2) Financial Statement Schedules
All financial statement schedules have been omitted as the information is not required under the related instructions or is not applicable or because the information required is already included in the financial statements or the notes to those financial statements.
(a)(3) Exhibits
The documents set forth below are filed herewith or incorporated herein by reference to the location indicated.
Exhibit Number Exhibit Description Incorporated by Reference
Form File No. Exhibit Filing Date
2.1#
Membership Interest Purchase Agreement, dated April 3, 2019, by and among, i3 Verticals, LLC, i3-Bearcat, LLC, NTD Holdings, Inc., GH Holdco, Inc. and David Graves and Tory Humphries
8-K 001-38532 2.1 4/8/19
2.2#
Agreement and Plan of Merger, dated May 31, 2019, by and among i3-SDCR, Inc., as buyer, i3 Merger Sub, Inc., i3 Verticals, LLC, as guarantor, Pace Payment Systems, Inc. and 3S Advisors, LLC, as representative
8-K 001-38532 2.1 6/3/19
3.1
Amended and Restated Certificate of Incorporation of i3 Verticals, Inc .
8-K 001-38532 3.1 6/25/18
3.2
Amended and Restated Bylaws of i3 Verticals, Inc.
8-K 001-38532 3.2 6/25/18
4.1
Specimen Stock Certificate evidencing the shares of Class A common stock
S-1 333-225214 4.1 5/25/18
4.2
Description of Securities
10-K 001-38532 4.2 11/22/19
4.3
Indenture, dated February 18, 2020, among i3 Verticals, LLC, i3 Verticals, Inc. as guarantor and U.S. Bank National Association
8-K 001-38532 4.1 2/19/20
4.4
Form of 1.00% Exchangeable Senior Notes due 2025 (included in Exhibit 4.3 above)
8-K 001-38532 4.2 2/19/20
10.1
Form of Tax Receivable Agreement
S-1 333-225214 10.2 5/25/18
10.2
Form of Registration Rights Agreement
S-1 333-225214 10.3 5/25/18
10.3
Limited Liability Company Agreement of i3 Verticals, LLC
8-K 001-38532 10.3 6/25/18
10.4
Plan Administration Agreement, dated June 25, 2018, by and between i3 Verticals, Inc. and i3 Verticals, LLC
8-K 001-38532 10.4 6/25/18
10.5#
Amended and Restated Credit Agreement, dated as of May 9, 2019, among i3 Verticals, LLC, the guarantor and lender parties thereto and Bank of America, N.A., as administrative agent
8-K 001-38532 10.1 5/13/19
10.6#
Security and Pledge Agreement, dated as of May 9, 2019, among i3 Verticals, LLC, as borrower, the Obligors thereto, and Bank of America, N.A., as administrative agent
8-K 001-38532 10.2 5/13/19
10.7
First Amendment to the Amended and Restated Credit Agreement, dated as of June 26, 2019, among i3 Verticals, LLC, the guarantor and lender parties thereto and Bank of America, N.A., as administrative agent
10-Q 001-38532 10.3 8/13/19
10.8+
i3 Verticals, LLC Amended & Restated Equity Incentive Plan, dated November 29, 2016
S-1 333-225214 10.21 5/25/18
10.9+
First Amendment to i3 Verticals, LLC Amended & Restated Equity Incentive Plan, dated October 31, 2017
S-1 333-225214 10.22 5/25/18
10.10+
Second Amendment to i3 Verticals, LLC Amended & Restated Equity Incentive Plan, dated May 7, 2018
S-1 333-225214 10.23 5/25/18
10.11+
2018 Equity Incentive Plan
S-1 333-225214 10.24 5/25/18
10.12+
Form of Restricted Stock Award Agreement under 2018 Equity Incentive Plan
S-1 333-225214 10.25 5/25/18
10.13+
Form of Stock Option Award Agreement under 2018 Equity Incentive Plan
S-1 333-225214 10.26 5/25/18
10.14+
Employment Agreement, effective as of May 5, 2014, by and between Charge Payment, LLC and Clay M. Whitson
S-1 333-225214 10.27 5/25/18
10.15+
Change in Control Agreement, dated as of May 10, 2017, by and between i3 Verticals, LLC and Paul Maple
S-1 333-225214 10.28 5/25/18
10.16+
Form of Indemnification Agreement
S-1 333-225214 10.29 5/25/18
10.17#
Second Amendment to the Amended and Restated Credit Agreement, dated as of May 9, 2019, by and among i3 Verticals, LLC, as the borrower, i3 Verticals, Inc. and certain Subsidiaries of i3 Verticals, Inc., as guarantors, the lenders party thereto, and Bank of America, N.A., as administrative agent for the lenders
8-K 001-38532 10.1 2/19/20
10.18
Registration Rights Agreement, dated February 18, 2020, among i3 Verticals, Inc. and BofA Securities, Inc .
8-K 001-38532 10.2 2/19/20
10.19
Form of Exchangeable Note Hedge Transaction Confirmation .
8-K 001-38532 10.3 2/19/20
10.2 0
Form of Warrant Transaction Confirmation
8-K 001-38532 10.4 2/19/20
10.21
i3 Verticals, Inc. 2020 Acquisition Equity Incentive Plan
8-K 001-38532 10.1 9/9/20
10.22
Form of Restricted Stock Award Agreement under i3 Verticals, Inc. 2020 Acquisition Equity Incentive Plan
8-K 001-38532 10.2 9/9/20
10.23
Form of Stock Option Award Agreement under 2020 Acquisition Equity Incentive Plan
8-K 001-38532 10.3 9/9/20
21.1*
List of subsidiaries of i3 Verticals, Inc.
23.1*
Consent of Deloitte & Touche LLP, Independent Registered Public Accounting Firm
23.2*
Consent of BD O USA LLP, Independent Registered Public Accounting Firm
3 1 .1*
Certification of Chief Executive Officer pursuant to Rules 13a-14 (a)/15d -14a under the S ecurities Exchange Act of 1934. as amended
31.2*
Certification of Chief Financial Officer pursuant to Rules 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as amended
32.1**
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS* XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101.SCH* Inline XBRL Taxonomy Extension Schema Document.
101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF* Inline XBRL Taxonomy Definition Linkbase Document.
101.LAB* Inline XBRL Taxonomy Label Linkbase Document.
101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
____________________
# Schedules and exhibits have been omitted pursuant to Item 601 of Regulation S-K. i3 Verticals, Inc. hereby undertakes to furnish supplementally copies of any of the omitted schedules and exhibits upon request by the Securities and Exchange Commission.
+ Denotes a management contract or compensatory plan or arrangement.
* Filed herewith.
** Furnished herewith.
Item 16. Form 10-K Summary
None.
133
SIGNATURES
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.
i3 Verticals, Inc.
By: /s/ Gregory Daily
Gregory Daily
Chief Executive Officer
Date: November 23, 2020
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on its behalf of the registrant and in the capacities and on the dates indicated:
Signature Title Date
/s/ Gregory Daily Chief Executive Officer and Director November 23, 2020
Gregory Daily (Principal Executive Officer)
/s/ Clay Whitson Chief Financial Officer and Director November 23, 2020
Clay Whitson (Principal Financial Officer and Principal Accounting Officer)
/s/ Elizabeth Seigenthaler Courtney Director November 23, 2020
Elizabeth Seigenthaler Courtney
/s/ John Harrison Director November 23, 2020
John Harrison
/s/ Burton Harvey Director November 23, 2020
Burton Harvey
/s/ Timothy McKenna Director November 23, 2020
Timothy McKenna
/s/ David Morgan Director November 23, 2020
David Morgan
/s/ David Wilds Director November 23, 2020
David Wilds
134