Seer, Inc. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Under the supervision and with the participation of our management, including our Chief Executive Officer (CEO), and Chief Financial Officer (CFO), we evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act) as of the end of the period covered by this report. Our disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports 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 such information is accumulated and communicated to our management, including the CEO and the CFO, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on that evaluation, our CEO and CFO have concluded, as of December 31, 2021, our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in the 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 such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosures. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Our internal control system is designed to provide reasonable assurance regarding the preparation and fair presentation of externally-reported consolidated financial statements in accordance with generally accepted accounting principles in the United States (U.S. GAAP). As discussed above, internal control systems, no matter how well designed, have inherent limitations and can provide only reasonable assurance that their objectives have been met. As disclosed in Part II Item 9A Controls and Procedures in our Annual Report on Form 10-K for the year ended December 31, 2020, we identified material weaknesses in each of the following components of the Internal Control -Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO): • insufficient accounting personnel to enable segregation of duties relating to the general ledger, disbursement, and certain accounting functions; • no formalized processes or controls for account reconciliations, including independent review of such reconciliations, or related financial statement analysis prepared in conformity with U.S. GAAP; and • an insufficient complement of accounting personnel with the necessary U.S. GAAP technical expertise to timely identify and account for complex or non-routine transactions or to formalize accounting policies, memoranda, or controls for such transactions. During 2021, management implemented our previously disclosed remediation plan that included: (i) hiring six finance department employees with appropriate expertise, including our CFO and Controller; (ii) retaining an accounting consulting firm to provide additional depth and breath to our technical and financial reporting capabilities; and (iii) implementing formal financial reporting processes and internal controls and building out our financial management and reporting systems infrastructure, which includes ongoing senior management review, and establishing our audit committee oversight. During the fourth quarter of 2021, we completed our testing of the operating effectiveness of the implemented controls and found them to be effective. As of December 31, 2021, our management conducted 115 an evaluation, under the supervision and with the participation of our CEO and CFO, of the effectiveness of our internal control over financial reporting based upon the framework in the Internal Control -Integrated Framework (2013), issued by COSO. Based upon that evaluation, our CEO and CFO concluded that our internal control over financial reporting was effective as of December 31, 2021 and that the material weaknesses have been remediated as of December 31, 2021. Deloitte & Touche LLP, an independent registered public accounting firm that audited the consolidated financial statements included in this Annual Report on Form 10-K, has also audited the effectiveness of our internal control over financial reporting as of December 31, 2021, as stated in their report which appears herein under Part II, Item 9A of this Annual Report on Form 10-K. Inherent Limitations on Effectiveness of Controls Our management, including our CEO and CFO, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. Changes in Internal Control over Financial Reporting Except for the changes in connection with our implementation of the remediation plan discussed above, there have been no other changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) of the Exchange Act) that occurred during the period that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. 116 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the Board of Directors of Seer, Inc. Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Seer, Inc. and subsidiary (the “Company”) as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2021, of the Company and our report dated March 1, 2022, expressed an unqualified opinion on those financial statements and included an explanatory paragraph regarding the Company’s change in its method of accounting for leases in fiscal year 2021 due to the adoption of ASC Topic 842, Leases. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk 117 that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Deloitte and Touche LLP San Francisco, California March 1, 2022 118 Item 9B. Other Information None Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections None 119 PART III. Item 10. Directors, Executive Officers and Corporate Governance. We have adopted a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller or, persons performing similar functions. The code of business conduct and ethics is available on our website at http://seer.bio. We intend to disclose future amendments to such code, or any waivers of its requirements, applicable to any principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions, or our directors on our website identified above or in a Current Report on Form 8-K. Information contained on the website is not incorporated by reference into this Annual Report. The remaining information required under this item is incorporated herein by reference to our definitive proxy statement (the “Proxy Statement”) pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended, which Proxy Statement is expected to be filed with Securities and Exchange Commission not later than 120 days after the close of our fiscal year ended December 31, 2021. Item 11. Executive Compensation The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference. Item 14. Principal Accounting Fees and Services The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference. 120 PART IV. Item 15. Exhibit and Financial Statement Schedules The following documents are filed as part of this Annual Report: 1. Financial Statements: The financial statements filed as part of this Annual Report are included in Part II, Item 8 of this Annual Report. 2. Financial Statement Schedules: Financial statement schedules have been omitted in this Annual Report because they are not applicable, not required under the instructions or the information requested is set forth in the financial statements or related notes thereto. 3. Exhibits: The list of exhibits filed with this Annual Report on Form 10-K is set forth in the Exhibit Index preceding the signature page and is incorporated herein by reference or filed with this Annual Report on Form 10-K, in each case as indicated therein (numbered in accordance with Item 601 of Regulation S-K). Exhibit Number Description Form File No. Exhibit Filing Date 3.1 Amended and Restated Certificate of Incorporation of the Registrant . 8-K 001-39747 3.1 12/8/2020 3.2 Amended and Restated Bylaws of the Registrant. 8-K 001-39747 3.2 12/8/2020 4.1 Form of common stock certificate of the Registrant. S-1 333-250035 4.1 11/12/2020 4.2 Amended and Restated Investors’ Rights Agreement, by and among the Registrant and certain holders of its capital stock, dated as of December 9, 2020. S-1 333-252395 4.2 1/25/2021 4.3 Description of the Registrant’s securities registered pursuant to Section 12 of the Securities Exchange Act of 1934. 10-K 001-39747 4.3 3/29/2021 10.1+ Form of Indemnification Agreement between the Registrant and each of its directors and executive officers. S-1 333-250035 10.1 11/12/2020 10.2+ 2020 Equity Incentive Plan and related form agreements. S-1/A 333-250035 10.2 11/30/2020 10.3+ 2017 Stock Incentive Plan and related form agreements. S-1/A 333-250035 10.3 11/30/2020 121 10.4+ 2020 RSU Equity Incentive Plan and related form agreements. S-1/A 333-250035 10.4 11/30/2020 10.5+ 2020 Employee Stock Purchase Plan. 10-Q 001-39747 10.2 8/12/2021 10.6+ Key Executive Change in Control and Severance Plan, and form of Participation Agreement thereunder. S-1/A 333-250035 10.6 11/30/2020 10.7+ Confirmatory Offer Letter between the Registrant and Dr. Omid Farokhzad, dated November 30, 2020. S-1/A 333-250035 10.7 11/30/2020 10.8+ Confirmatory Offer Letter between the Registrant and Omead Ostadan, dated November 30, 2020. S-1/A 333-250035 10.8 11/30/2020 10.9+ Confirmatory Offer Letter between the Registrant and David Horn, dated November 30, 2020. S-1/A 333-250035 10.9 11/30/2020 10.10+ CEO Change in Control and Severance Agreement between the Registrant and Dr. Omid Farokhzad, dated November 30, 2020. S-1/A 333-250035 10.10 11/30/2020 10.11+ Executive Incentive Compensation Plan . S-1/A 333-250035 10.11 11/30/2020 10.12+ Outside Director Compensation Policy 10-Q 001-39747 10.1 8/12/2021 10.13# Umbrella Development & Supply Agreement between the Registrant and Hamilton Company, dated March 9, 2020. S-1 333-250035 10.14 11/12/2020 10.14# Exclusive Patent License Agreement between the Registrant and The Brigham and Women’s Hospital, Inc., dated December 18, 2017. S-1 333-250035 10.15 11/12/2020 122 10.15 Class A Common Stock Purchase Agreement by and among the Registrant, Fidelity Management & Research Company LLC, SoftBank, certain funds and accounts advised by T. Rowe Price Associates, Inc. and aMoon Fund, dated as of November 12, 2020. S-1 333-250035 10.15 11/12/2020 10.16 Leave of Absence Agreement between Omead Ostadan and the Company effective October 7, 2021. 8-K 001-39747 10.1 10/13/2021 10.17 Amended Confirmatory Employment Letter between the Company and Omead Ostadan, dated February 18, 2022. 8-K 001-39747 10.1 2/18/2022 21.1 List of Subsidiaries of the Registrant. S-1 333-252395 21.1 1/25/2021 23.1 Consent of Deloitte & Touche LLP, independent registered public accounting firm. * 31.1 Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. * 31.2 Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. * 32.1† Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 123 101.INS Inline XBRL Instance Document 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File - the Cover Page Interactive Data File does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. __________ + Indicates management contract or compensatory plan. † The certifications attached as Exhibit 32.1 that accompany this Annual Report on Form 10-K, are deemed furnished and not filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing. # Confidential treatment has been requested for portions of this exhibit. These portions have been omitted and have been filed separately with the Securities and Exchange Commission. * Filed herewith 124 Item 16. Form 10-K Summary None. 125 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: March 1, 2022 SEER, INC. By: /s/ Omid Farokhzad, M.D. Omid Farokhzad, M.D. Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated. SIGNATURE TITLE DATE /s/ Omid Farokhzad, M.D. Chief Executive Officer and Chair of the Board of Directors ( Principal Executive Officer ) March 1, 2022 Omid Farokhzad, M.D. /s/ David R. Horn Chief Financial Officer ( Principal Financial Officer and Accounting Officer ) March 1, 2022 David R. Horn /s/ David Halla Lead Independent Director March 1, 2022 David Hallal /s/ Catherine Friedman Director March 1, 2022 Catherine Friedman /s/ Meeta Gulyani Director March 1, 2022 Meeta Gulyani /s/ Rachel Haruwitzm Ph.D. Director March 1, 2022 Rachel Haurwitz, Ph.D. /s/ Robert Langer, Sc.D. Director March 1, 2022 Robert Langer, Sc.D. /s/ Terrance McGuire Director March 1, 2022 Terrance McGuire /s/ Deep Nishar Director March 1, 2022 Deep Nishar /s/ Omead Ostadan Director March 1, 2022 Omead Ostadan /s/ Mostafa Ronahi. Ph.D. Director March 1, 2022 Mostafa Ronaghi, Ph.D. 126