What changed in this filing

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Item 9A. Controls and Procedures

2023-03-01 compared with 2022-03-01 · 75 added, 76 removed, 132 unchanged (53% of the section changed)

2 unchanged sentences

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934, we carried out an evaluation, with the participation of our management, including our Chief Executive Officer and Executive Vice President and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined under Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report.

Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Executive Vice President and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Management Report on Internal Control over Financial Reporting

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provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.

Our internal control over financial reporting, specifically the review controls over the evaluation of complex, non-routine transactions, were previously determined to be insufficient to detect the proper accounting and reporting for the public warrants and private placement Warrants previously issued by Thunder Bridge, which were outstanding and recorded on our consolidated financial statements at the time of the Business Combination.

Management identified this error when the Securities and Exchange Commission issued a statement (the “Statement”) on the accounting and reporting considerations for warrants issued by special purpose acquisition companies on April 12, 2021.

The Statement addressed certain accounting and reporting considerations related to warrants of a kind similar to the Warrants.

This control deficiency resulted in the Company having to restate certain of our audited consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2020 and the quarterly periods included therein, and if not remediated, could have resulted in a material misstatement to future annual or interim consolidated financial statements that would not be prevented or detected.

Accordingly, management previously determined that this control deficiency constituted a material weakness during the quarter ended March 31, 2021.

Since the restatement, management has implemented remediation steps to address that material weakness and to improve our internal control over financial reporting.

Specifically, we expanded and improved our review process for complex securities and related accounting standards.

We have further improved this process by enhancing access to accounting literature, identification of third-party professionals with whom to consult regarding complex accounting applications and consideration of additional staff with the requisite experience and training to supplement existing accounting professionals.

As of September 30, 2021, the control deficiency related to the restatement had been remediated.

Our management, with the participation of our principal executive and principal financial and accounting officers, assessed the effectiveness of our internal control over financial reporting as of December 31, 2022.

In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway

Commission (“COSO”) in its 2013 Internal Control — Integrated Framework.

In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in its 2013 Internal Control —

Integrated Framework.

Based on this assessment, our management has concluded that, as of December 31, 2022, our internal control over financial reporting is effective based on those criteria.

Management excluded BillingTree, Kontrol and Payix from its assessment of the effectiveness of our internal control over financial reporting as of December 31, 2021 because those entities were acquired in business combinations in the past year.

BillingTree’s total assets (excluding goodwill and intangible assets related to the acquisitions which are a part of the Company’s existing control environment) and total revenue represented approximately 3.0% and 14.3%, respectively, of our consolidated total assets and total revenues, as of and for the year ended December 31, 2021.

Kontrol’s total assets (excluding goodwill and intangible assets related to the acquisitions which are a part of the Company’s existing control environment) and total revenue represented approximately 0.1% and 0.8%, respectively, of our consolidated total assets and total revenues, as of and for the year ended December 31, 2021.

Payix’s total assets (excluding goodwill and intangible assets related to the acquisitions which are a part of the Company’s existing control environment) and total revenue represented approximately 0.9% and 0.1%, respectively, of our consolidated total assets and total revenues, as of and for the year ended December 31, 2021.

The effectiveness of our internal control over financial reporting as of December 31, 2022 has been audited by Grant Thornton LLP, an independent registered public accounting firm, as stated in their Report of Independent Registered Certified Public Accounting Firm on Internal Control Over Financial Reporting which is included with the Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K and is incorporated herein by reference.

Changes in Internal Control Over Financial Reporting

During the quarter ended December 31, 2021, no change in our internal controls over financial reporting (as defined in Rule 13a-15(f) under the Act) occurred that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

During the quarter ended December 31, 2022, as part of our ongoing integration activities following the acquisition of BillingTree, we applied our controls and procedures to the acquired operations of BillingTree and augmented our Company-wide controls to address the risks inherent in a business combination of this magnitude.

OTHER INFORMATION.

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Not applicable.

Information called for by Part III (Items 10, 11, 12, 13 and 14) of this Annual Report on Form 10-K has been omitted as we intend to file with the SEC not later than 120 days after the end of our fiscal year ended December 31, 2021, an amendment to this Form 10-K or a definitive Proxy Statement pursuant to Regulation 14A promulgated under the Exchange Act relating to the Company’s annual meeting of stockholders to be held in 2022 (as applicable, the “Part III Filing”).

Information called for by Part III (Items 10, 11, 12, 13 and 14) of this Annual Report on Form 10-K has been omitted as we intend to file with the SEC not later than 120 days after the end of our fiscal year ended December 31, 2022, an amendment to this Form 10-K or a definitive Proxy Statement pursuant to Regulation 14A promulgated under the Exchange Act relating to the Company’s annual meeting of stockholders to be held in 2023 (as applicable, the “Part III Filing”).

Such information will be set forth in such Part III Filing and is incorporated herein by reference.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

DIRECTORS, EXECUTIVE OFF ICERS AND CORPORATE GOVERNANCE.

The information required to be included by Item 10 of Form 10-K will be included in our Part III Filing and such information is incorporated by reference herein.

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We intend to disclose any amendment to, or waiver from, a provision of our code of ethics that applies to our Chief Executive Officer, Chief Financial Officer or principal accounting officer by posting such information on the Investors section of our website.

EXECUTIVE COMPENSATION.

EXECUTIV E COMPENSATION.

The information required to be included by Item 11 of the Form 10-K will be included in our Part III Filing and such information is incorporated by reference herein.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWN ERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The information required to be included by Item 12 of Form 10-K will be included in our Part III Filing and such information is incorporated by reference herein.

1 unchanged sentence

The information required to be included by Item 13 of Form 10-K will be included in our Part III Filing and such information is incorporated by reference herein.

PRINCIPAL ACCOUNTING FEES AND SERVICES.

PRINCIPAL ACCOUN TING FEES AND SERVICES.

The information required to be included by Item 14 of Form 10-K will be included in our Part III Filing and such information is incorporated by reference herein.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

EXHIBITS, FINANC IAL STATEMENT SCHEDULES.

(1) Financial Statements

1 unchanged sentence

Reports of Independent Registered Public Accounting Firm (PCAOB ID Number 248)

Consolidated Balance Sheets as of D ecember 31, 2021 and 2020

Consolidated Statements of Operations for the years ended December 31, 2021 and 2020, and the periods ended December 31, 2019 and July 10, 2019

Consolidated Statements of Comprehensive Income for the years ended December 31, 2021 and 2020, and the periods ended December 31, 2019 and July 10, 2019

Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2021 and 2020, and the periods ended December 31, 2019 and July 10, 2019

Consolidated Statements of Cash Flows for the years ended December 31, 2021 and 2020, and the periods ended December 31, 2019 and July 10, 2019

Consolidated Balance Sheets as of December 31, 2022 and 2021

Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020

Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020

Consolidated Statements of Stockholders’

Equity for the years ended December 31, 2022, 2021 and 2020

Consolidated Statements of Cash Flows for the years ended December 31, 2022, 2021 and 2020

Notes to Consolidated Financial Statements

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All financial statement schedules have been omitted as the information is not required under the related instruction or is not applicable or because the information required is already included in the financial statements or the notes to those financial statements.

Agreement and Plan of Merger, dated as of January 21, 2019, by and among Thunder Bridge, Merger Sub, Hawk Parent, and the Repay Securityholder Representative named therein (incorporated by reference to Exhibit 2.1 of Thunder Bridge’s Form 8-K (File No.

001-38531), filed with the SEC on January 22, 2019).

First Amendment to Agreement and Plan of Merger, dated February 11, 2019, by and among Thunder Bridge, Merger Sub, Hawk Parent, and the Repay Securityholder Representative named therein (incorporated by reference to Exhibit 2.1 of Thunder Bridge’s Form 8-K (File No.

001-38531), filed with the SEC on February 12, 2019).

Second Amendment to Agreement and Plan of Merger, dated May 9, 2019, by and among Thunder Bridge, Merger Sub, Hawk Parent, and the Repay Securityholder Representative named therein (incorporated by reference to Exhibit 2.1 of Thunder Bridge’s Form 8-K (File No.

001-38531), filed with the SEC on May 9, 2019).

Third Amendment to Agreement and Plan of Merger, dated June 19, 2019, by and among Thunder Bridge, Merger Sub, Hawk Parent, and the Repay Securityholder Representative named therein (incorporated by reference to Exhibit 2.1 of Thunder Bridge’s Form 8-K (File No.

001-38531), filed with the SEC on June 20, 2019).

Securities Purchase Agreement, dated as February 10, 2020, by and among Repay Holdings, LLC and the direct and indirect owners of CDT Technologies, LTD.

(incorporated by reference to Exhibit 2.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on February 10, 2020).

Purchase Agreement, dated October 26, 2020, by and among Repay Holdings, LLC and CPS Holdings, LLC, CPS Media, LLC, DB & AS Enterprises, Inc., and James F.

Hughes, LLC (incorporated by reference to Exhibit 2.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on October 27, 2020).

Agreement and Plan of Merger, dated as of May 7, 2021, by and among BT Intermediate, LLC, Repay Holdings Corporation, Beckham Acquisition LLC, Beckham Merger Sub LLC and BillingTree Parent, L.P.

(incorporated by reference to Exhibit 2.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on May 10, 2021).

Certificate of Corporate Domestication of Repay Holdings Corporation (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.2 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Bylaws of the Company (incorporated by reference to Exhibit 3.3 of the Company’s Form 8-K (001-38531), filed with the SEC on July 17, 2019).

Amendment to Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K (File No.

001-38351), filed with the SEC on June 9, 2022).

Amended and Restated Bylaws of the Company (incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K (001-38531), filed with the SEC on February 24, 2023).

Indenture, dated as of January 19, 2021 between Repay Holdings Corporation and U.S.

Bank National Association (incorporated by reference to Exhibit 4.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on January 19, 2021).

Description of Registrant’s Securities.

Exchange Agreement, dated July 11, 2019, by and among the Company, Repay and the other holders of Class A units of Repay (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K (File No.

Description of Registrant’s Securities (incorporated by reference to Exhibit 4.1 of the Company’s Form S-3ASR (Filed No.

333-266158), filed with the SEC on July 15, 2022).

Tax Receivable Agreement, dated July 11, 2019, by and among the Company and the other Repay Unitholders (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Tax Receivable Agreement, dated July 11, 2019, by and among the Company and the other Repay Unitholders (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Founder Stockholders Agreement, dated as of July 11, 2019, between the Company, John A.

Morris, Shaler V.

Alias, The JAM Family Charitable Trust dated March 1, 2018, JOSEH Holdings, LLC and Alias Holdings, LLC (incorporated by reference to Exhibit 10.5 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Registration Rights Agreement, dated July 11, 2019, by and among the Company, Repay, and the Repay Unitholders (incorporated by reference to Exhibit 10.6 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Registration Rights Agreement, dated June 18, 2018, by and between the Company, the Sponsor and the holders party thereto (incorporated by reference to Exhibit 10.4 of Thunder Bridge’s Form 8-K (File No.

001-38531), filed with the SEC on June 22, 2018).

First Amendment to Registration Rights Agreement, dated July 11, 2019, by and among Thunder Bridge Acquisition Ltd.

and Thunder Bridge Acquisition LLC (incorporated by reference to Exhibit 10.7 to the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Registration Rights Agreement, dated as of May 7, 2021, by and among Repay Holdings Corporation and BillingTree Parent, L.P.

(incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No.

001-385311), filed with the SEC on May 10, 2021).

Amended and Restated Revolving Credit Agreement, dated February 3, 2021, by and among Repay Holdings Corporation, Hawk Parent Holdings LLC, Truist Bank, as Administrative Agent, and the other parties thereto (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on February 5, 2021).

Limited Consent, Waiver and First Amendment to Amended and Restated Revolving Credit Agreement, dated June 15, 2021, by and among Repay Holdings Corporation, Hawk Parent Holdings LLC, Truist Bank, as administrative agent, and the other parties thereto (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on January 3, 2022).

Second Amendment to Amended and Restated Revolving Credit Agreement, dated December 29, 2021, by and among Repay Holdings Corporation, Hawk Parent Holdings LLC, Truist Bank, as Administrative Agent, and the other parties thereto (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on January 3, 2022).

Repay Holdings Corporation Omnibus Incentive Plan, effective as of July 11, 2019 (incorporated by reference to Exhibit 10.10 to the Company’s Form 8-K (File No.

Third Amendment to Amended and Restated Revolving Credit Agreement, dated February 9, 2023, by and among Repay Holdings Corporation, Hawk Parent Holdings, LLC, Truist Bank, as Administrative Agent, and the other parties thereto (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K (File No.

001-38531), filed with the SEC on February 10, 2023).

Repay Holdings Corporation Omnibus Incentive Plan, effective as of July 11, 2019 (incorporated by reference to Exhibit 10.10 to the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Amendment No.

1 to the Repay Holdings Corporation Omnibus Incentive Plan, effective as of September 20, 2019 (incorporated by reference to Exhibit 99.2 to the Company’s Form S-8 (Registration No.

233879), filed with the SEC on September 20, 2019).

Employment Agreement, dated January 21, 2019, between M & A Ventures, LLC and John Morris (incorporated by reference to Exhibit 10.24 of the Company’s Form S-4 (Registration No.

Repay Holdings Corporation Omnibus Incentive Plan (as Amended and Restated Effective as of April 14, 2022) (incorporated by reference to Annex A to the Company’s proxy statement (File No.

001-38531), filed with the SEC on April 27, 2022).

Employment Agreement, dated January 21, 2019, between M & A Ventures, LLC and John Morris (incorporated by reference to Exhibit 10.24 of the Company’s Form S-4 (Registration No.

333-229616), filed with the SEC on February 12, 2019).

Amendment No.

1 to Employment Agreement, dated March 1, 2021, between Repay Management Services LLC (as assignee of M & A Ventures, LLC) and John Morris (incorporated by reference to Exhibit 10.11 to the Company’s Form 10-K/A (File No.

001-38531), filed with the SEC on April 23, 2021).

Employment Agreement, dated January 21, 2019, between M & A Ventures, LLC and Shaler Alias (incorporated by reference to Exhibit 10.25 of the Company’s Form S-4 (Registration No.

Amendment No.

2 to Employment Agreement, dated March 1, 2022, between Repay Management Services LLC (as assignee of M & A Ventures, LLC) and John Morris (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K (File No.

001-38531), filed with the SEC on March 1, 2022).

Employment Agreement, dated January 21, 2019, between M & A Ventures, LLC and Shaler Alias (incorporated by reference to Exhibit 10.25 of the Company’s Form S-4 (Registration No.

333-229616), filed with the SEC on February 12, 2019).

Amendment No.

1 to Employment Agreement, dated March 1, 2021, between Repay Management Services LLC (as assignee of M & A Ventures, LLC) and Shaler Alias (incorporated by reference to Exhibit 10.13 to the Company’s Form 10-K/A (File No.

001-38531), filed with the SEC on April 23, 2021).

Employment Agreement, dated January 21, 2019, between M & A Ventures, LLC and Timothy J.

Murphy (incorporated by reference to Exhibit 10.26 of the Company’s Form S-4 (Registration No.

333-229616), filed with the SEC on February 12, 2019).

1 unchanged sentence

1 to Employment Agreement, dated March 1, 2021, between Repay Management Services LLC (as assignee of M & A Ventures, LLC) and Timothy J.

Murphy (incorporated by reference to Exhibit 10.15 to the Company’s Form 10-K/A (File No.

001-38531), filed with the SEC on April 23, 2021).

Employment Agreement dated September 1, 2019, between Repay Management Services LLC and Tyler B.

Dempsey (incorporated by reference to Exhibit 10.16 to the Company’s Form 10-K/A (File No.

001-38531), filed with the SEC on April 23, 2021).

1 unchanged sentence

1 to Employment Agreement, dated March 1, 2021, between Repay Management Services LLC and Tyler B.

Dempsey (incorporated by reference to Exhibit 10.17 to the Company’s Form 10-K/A (File No.

001-38531), filed with the SEC on April 23, 2021).

Employment Agreement, dated January 21, 2019, between M & A Ventures, LLC and Michael F.

Jackson (incorporated by reference to Exhibit 10.29 of the Company’s Form S-4 (Registration No.

333-229616), filed with the SEC on February 12, 2019).

1 unchanged sentence

1 to Employment Agreement, dated March 1, 2021, between Repay Management Services LLC (as assignee of M & A Ventures, LLC) and Michael F.

Jackson (incorporated by reference to Exhibit 10.19 to the Company’s Form 10-K/A (File No.

001-38531), filed with the SEC on April 23, 2021).

Repay Holdings Corporation Form of Restricted Stock Award Agreement (Time Vested) (incorporated by reference to Exhibit 10.17 to the Company’s Form 8-K (File No.

Transitional Consulting Agreement, dated November 28, 2022, between Repay Management Services LLC and Michael F.

Employment Agreement, dated April 1, 2020, between Repay Management Services and Jacob H.

Moore (incorporated by reference to Exhibit 10.2 of the Company’s Form 10-Q (Registration No.

001-38531), filed with the SEC on May 10, 2022).

First Amendment to Employment Agreement, dated March 1, 2021, between Repay Management Services and Jacob H.

Moore (incorporated by reference to Exhibit 10.3 of the Company’s Form 10-Q (Registration No.

001-38531), filed with the SEC on May 10, 2022).

Repay Holdings Corporation Form of Restricted Stock Award Agreement (Time Vested) (incorporated by reference to Exhibit 10.17 to the Company’s Form 8-K (File No.

001-38531), filed with the SEC on July 17, 2019).

Repay Holdings Corporation Form of Restricted Stock Unit Agreement between the Company and the Grantee named therein (incorporated by reference to Exhibit 10.13 of the Company’s Form 10-Q (File No.

001-38531), filed with the SEC on November 14, 2019).

Repay Holdings Corporation Summary of Non-Employee Director Compensation, as of September 20, 2019 (incorporated by reference to Exhibit 10.14 of the Company’s Form 10-Q (File No.

Repay Holdings Corporation Form of Restricted Stock Unit Agreement between the Company and the Grantee named therein (incorporated by reference to Exhibit 10.13 of the Company’s Form 10-Q (File No.

001-38531), filed with the SEC on November 14, 2019).

Repay Holdings Corporation Summary of Non-Employee Director Compensation, as of April 1, 2022.

Repay Holdings Corporation Form of Restricted Stock Award Agreement between the Company and the Grantee named therein (incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K (File No.

001-38531) filed with the SEC on March 17, 2020).

Repay Holdings Corporation Form of Performance-Based Restricted Stock Units Award Agreement between the Company and the Grantee named therein (incorporated by reference to Exhibit 10.2 of the Company’s Form 8-K (File No.

001-38531) filed with the SEC on March 17, 2020).

Form of Indemnification Agreement between the Company and the Indemnitee named therein (incorporated by reference to Exhibit 10.32 of the Company’s Form 10-K/A (File No.

001-38531) filed with the SEC on April 17, 2020).

Repay Holdings Corporation Form of Restricted Stock Award Agreement (2022).

Repay Holdings Corporation Form of Restricted Stock Award Agreement (2022) (incorporated by reference to Exhibit 10.30 of the Company’s Form 10-K (File No.

011-38531) filed with the SEC on March 1, 2022).

Subsidiaries of the registrant

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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 XBRL Taxonomy Extension Schema Document 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF XBRL Taxonomy Extension Definition Linkbase Document 101.LAB XBRL Taxonomy Extension Label Linkbase Document 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Annual Report on Form 10-K shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section and shall not be part of any registration or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section and shall not be part of any registration or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Cover Page Interactive Data File (Included in Exhibits 101)

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/s/ Thomas Sullivan

Vice President, Corporate Controller

Chief Accounting Officer

Thomas Sullivan

14 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