What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2023-08-15 compared with 2022-08-16 · 36 added, 42 removed, 109 unchanged (42% of the section changed)

1 unchanged sentence

(a) E FFECTIVENESS OF D ISCLOSURE C ONTROLS AND P ROCEDURES

We conducted an evaluation as of July 1, 2022 under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), and concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended, the “Exchange Act”) were effective as of July 1, 2022 and designed to ensure that the information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that it is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

We conducted an evaluation as of June 30, 2023 under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), and concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended, the “Exchange Act”) were effective as of June 30, 2023 and designed to ensure that the information required to be disclosed by us in reports that we file or submit under the Exchange Act

is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that it is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

(b) I NHERENT L IMITATIONS ON E FFECTIVENESS OF C ONTROLS

4 unchanged sentences

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

Under the supervision of the Chief Executive Officer and Chief Financial Officer, management conducted an assessment of the effectiveness of our internal control over financial reporting as of July 1, 2022 based on the framework in Internal Control - Integrated Framework (2013) published by the Committee of Sponsoring Organizations of the Treadway Commission.

As a result of this assessment, management concluded that our internal control over financial reporting was effective as of July 1, 2022.

The effectiveness of our internal control over financial reporting as of July 1, 2022 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in its report.

The audited consolidated financial statements of the Company include the results of the acquired Avalex business on and after November 5, 2021 and the acquired Atlanta Micro business on and after November 29, 2021, as described in Note C to the Consolidated Financial Statements.

Upon consideration of the scope of fiscal 2022 and the time constraints under which our management’s assessment would have to be made, management determined that it would not conduct an assessment of their internal controls over financial reporting environment as allowable under Section 404 of the Sarbanes-Oxley Act of 2002.

Accordingly, these operations have been excluded from the management’s assessment of internal controls for fiscal year 2022.

However, management is in the process of either integrating or assessing the creation of separate control environments for these currently non-integrated entities into the overall internal control over financial reporting environment for fiscal year 2023.

The Company’s consolidated financial statements reflect revenues and total assets from the acquired businesses of approximately 3 percent and 12 percent (of which 10 percent represented goodwill and intangible assets included within the scope of the Company’s assessment), respectively, as of and for the year ended July 1, 2022.

Under the supervision of the Chief Executive Officer and Chief Financial Officer, management conducted an assessment of the effectiveness of our internal control over financial reporting as of June 30, 2023 based on the framework in Internal Control - Integrated Framework (2013) published by the Committee of Sponsoring Organizations of the Treadway Commission.

As a result of this assessment, management concluded that our internal control over financial reporting was effective as of June 30, 2023.

The effectiveness of our internal control over financial reporting as of June 30, 2023 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in its report.

(d) C HANGES IN I NTERNAL C ONTROL O VER F INANCIAL R EPORTING

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth quarter of fiscal 2023 identified in connection with our Chief Executive Officer’s and Chief Financial Officer’s evaluation that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Management is in the process of integrating the Avalex and Atlanta Micro businesses into our overall internal control over financial reporting environment.

OTHER INFORMATION

15 unchanged sentences

Financial statements:

Report of Independent Registered Public Accounting Firm (PCAOB ID 185 )

Consolidated Balance Sheets as of July 1, 2022 and July 2, 2021

Consolidated Statements of Operations and Comprehensive Income for the fiscal years ended July 1, 2022, July 2, 2021 and July 3, 2020

Consolidated Statements of Shareholders’ Equity for the fiscal years ended July 1, 2022, July 2, 2021 and July 3, 2020

Consolidated Statements of Cash Flows for the years ended July 1, 2022, July 2, 2021 and July 3, 2020

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets as of June 30, 2023 and July 1, 2022

Consolidated Statements of Operations and Comprehensive (Loss) Income for the fiscal years ended June 30, 2023, July 1, 2022, and July 2, 2021

Consolidated Statements of Shareholders’ Equity for the fiscal years ended June 30, 2023, July 1, 2022, and July 2, 2021

Consolidated Statements of Cash Flows for the years ended June 30, 2023, July 1, 2022, and July 2, 2021

Notes to Consolidated Financial Statements

1 unchanged sentence

Valuation and Qualifying Accounts

FORM 10-K SUMMARY

MERCURY SYSTEMS, INC.

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

FOR FISCAL YEARS ENDED JULY 1, 2022, JULY 2, 2021 and July 3, 2020

FOR FISCAL YEARS ENDED JUNE 30, 2023, JULY 1, 2022, and JULY 2, 2021

(In thousands)

14 unchanged sentences

MERCURY SYSTEMS, INC.

By /s/ MICHAEL D.

By /s/ DAVID E.

EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER, AND TREASURER

2 unchanged sentences

Signature Title(s) Date

/s/ MARK ASLETT President, Chief Executive Officer and Director (principal executive officer) August 16, 2022

/S/ MICHAEL D.

RUPPERT Executive Vice President, Chief Financial Officer and Treasurer (principal financial officer) August 16, 2022

/s/ WILLIAM L.

BALLHAUS President, Chief Executive Officer and Director (principal executive officer) August 15, 2023

FARNSWORTH Executive Vice President, Chief Financial Officer, and Treasurer (principal financial officer) August 15, 2023

/S/ MICHELLE M.

2 unchanged sentences

O'BRIEN Chairman of the Board of Directors August 15, 2023

/S/ WILLIAM L.

BALLHAUS Director August 16, 2022

BASS Director August 16, 2022

/S/ ORLANDO P.

CARVALHO Director August 15, 2023

/S/ MICHAEL A.

DANIELS Director August 16, 2022

/S/ GERARD J.

DEMURO Director August 15, 2023

DISBROW Director August 15, 2023

/S/ HOWARD L.

LANCE Director August 16, 2022

/S/ MARY LOUISE KRAKAUER Director August 15, 2023

Mary Louise Krakauer

KRONE Director August 15, 2023

/S/ HOWARD L.

LANCE Director August 15, 2023

NEARHOS Director August 15, 2023

/S/ SCOTT OSTFELD Director August 15, 2023

Scott Ostfeld

/S/ DEBORA A.

8 unchanged sentences

Articles of Amendment (incorporated herein by reference to Exhibit 3.1 of the Company’s current report on Form 8-K filed on December 29, 2021)

Bylaws, amended and restated, effective as of July 28, 2020 (incorporated herein by reference to Exhibit 3.1 of the Company’s current report on Form 8-K filed on July 31, 2020

Bylaws, amended and restated, effective as of October 26, 2022 (incorporated herein by reference to Exhibit 3.1 of the Company’s current report on Form 8-K filed on October 28, 2022 )

Form of Stock Certificate (incorporated herein by reference to Exhibit 4.1 of the Company’s Registration Statement on Form S-1/A filed on January 7, 1998)

Description of Registrant's Securities (incorporated herein by reference to Exhibit 4.2 of the Company’s annual report on Form 10-K for the fiscal year ended July 3, 2020)

Rights Agreement, dated as of December 27, 2021, between the Company and Computershare Trust Company, N.A.

(incorporated herein by reference to Exhibit 4.1 of the Company’s current report on Form 8-K filed on December 29, 2021)

First Amendment to Rights Agreement, dated June 23, 2022, between the Company and Computershare Trust Company, N.A.

(incorporated herein by reference to Exhibit 4.1 of the Company’s current report on Form 8-K filed on June 24, 2022)

1997 Employee Stock Purchase Plan, as amended and restated

1997 Employee Stock Purchase Plan, as amended and restated (incorporated herein by reference to Exhibit 10.1 of the Company’s annual report on Form 10-K for the fiscal year ended July 1, 2022)

Form of Indemnification Agreement between the Company and each of its current directors (incorporated herein by reference to Exhibit 10.4 of the Company’s annual report on Form 10-K for the fiscal year ended June 30, 2009)

2018 Stock Incentive Plan, as amended and restated (incorporated herein by reference to Exhibit 10.5 of the Company’s annual report on Form 10-K for the fiscal year ended July 2, 2021)

2018 Stock Incentive Plan, as amended and restated

Form of Stock Option Agreement under the 2018 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.1 of the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2019)

1 unchanged sentence

Form of Deferred Stock Award Agreement under the 2018 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.3 of the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2019)

Form of Performance-Based Stock Option Agreement under the 2018 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.4 of the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2019)

Form of Stock Option Agreement for performance stock options under the 2005 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed on September 28, 2007)

Form of Performance-Based Restricted Stock Award Agreement under the 2018 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.5 of the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2019)

Form of Change in Control Severance Agreement between the Company and Non-CEO Executives (incorporated herein by reference to Exhibit 10.9.2 of the Company’s annual report on Form 10-K for the fiscal year ended June 30, 2011)

Form of Change in Control Severance Agreement between the Company and Mark Aslett (incorporated herein by reference to Exhibit 10.9.1 of the Company’s annual report on Form 10-K for the fiscal year ended June 30, 2011)

DESCRIPTION OF EXHIBIT

Compensation Policy for Non-Employee Directors

Employment Agreement, dated as of November 19, 2007, by and between the Company and Mark Aslett (incorporated herein by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed on November 20, 2007)

First Amendment to Employment Agreement, dated as of December 20, 2008, by and between the Company and Mark Aslett (incorporated herein by reference to Exhibit 10.2 of the Company’s quarterly report on Form 10-Q for the quarter ended December 31, 2008)

Second Amendment to Employment Agreement, dated as of September 30, 2009, by and between the Company and Mark Aslett (incorporated herein by reference to Exhibit 10.1 of the Company’s quarterly report on Form 10-Q for the quarter ended September 30, 2009)

Third Amendment to Employment Agreement, dated as of August 13, 2019, by and between the Company and Mark Aslett (incorporated herein by reference to Exhibit 10.9.4 of the Company's annual report on Form 10-K for the fiscal year ended July 30, 2019)

Credit Agreement, dated May 2, 2016, among the Company, the Guarantors party thereto, the Lenders party thereto and Bank of America, N.A., as Administrative Agent (incorporated herein by reference to Exhibit 10.1 of the Company's current report on Form 8-K filed on May 2, 2016)

6 unchanged sentences

Form of Severance Benefits Agreement between the Company and Non-CEO Executives (incorporated herein by reference to Exhibit 10.14 of the Company's annual report on Form 10-K for the fiscal year ended June 30, 2019)

Cooperation Agreement, dated June 23, 2022, by and between the Company and JANA Partners LLC (incorporated herein by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed on June 24, 2022)

Agreement, dated June 23, 2022, by and between the Company and Starboard Value LP and the other entities and persons listed on the signature pages thereto (incorporated herein by reference to Exhibit 10.2 of the Company’s current report on Form 8-K filed on June 24, 2022)

Letter Agreement, dated June 20, 2023, between the Company and David E.

Farnsworth (incorporated herein by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed on June 29, 2023)

Letter Agreement, dated September 15, 2021, between the Company and James M.

Stevison (incorporated by reference to Exhibit 10.2 of the Company’s quarterly report for the fiscal quarter ended September 30, 2022)

Letter Agreement, dated September 17, 2021, between the Company and Charles R.

Wells, IV (incorporated by reference to Exhibit 10.3 of the Company’s quarterly report for the fiscal quarter ended September 30, 2022)

Voting Agreement, dated July 6, 2023, by and between Mercury Systems, Inc.

and JANA Partners LLC (incorporated herein by reference to Exhibit 10.1 of the Company’s current report on Form 8-K filed on July 6, 2023)

Insider Trading Policy

Subsidiaries of the Company

18 unchanged sentences

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