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Item 9A. Controls and Procedures

2023-03-07 compared with 2022-03-10 · 48 added, 44 removed, 93 unchanged (50% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted 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 Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2022.

Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2021, our disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure .

Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2022.

Management’s Report on Internal Controls Over Financial Reporting

This Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

Under the rules and regulations of the SEC, the Company is not required to comply with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 until the Company files its Annual Report on Form 10-K for fiscal year ending December 31, 2022.

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) to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles.

Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework established in “Internal Control-Integrated Framework (2013)”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on this evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2022.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm on our internal control over financial reporting following an exemption established by the JOBS Act for “emerging growth companies.”

Changes in Internal Control over Financial Reporting

2 unchanged sentences

In designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

In addition, the design of a control system must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements related to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.

Other Information

Form of Management Incentive Bonus Plan

On March 1, 2023, the compensation committee (the “compensation committee”) of our board of directors approved a new form of our annual, performance-based Management Incentive Bonus Plan (“MIB”) that is applicable to our executive officers and certain other key employees, which is attached hereto as Exhibit 10.17 and is incorporated herein by reference.

The new form of MIB initially is applicable for the annual performance period ending as of December 31, 2023.

Form of Equity Award Agreements

On March 1, 2023, the compensation committee approved an updated Form of Restricted Stock Unit Award Agreement and a new Form of Stock Appreciation Right Award Agreement for grants of RSUs and stock appreciation rights (“SARs”) under the Latham Group, Inc.

2021 Omnibus Incentive Plan, which are attached hereto as Exhibits 10.14 and 10.15, respectively, and are incorporated herein by reference.

The new forms of equity award agreements were used for the annual equity awards to executive officers on March 1, 2023.

Non-Employee Director Compensation Policy

On February 21, 2023, the compensation committee ratified the Non-Employee Director Compensation Policy without change, which is attached hereto as Exhibit 10.16 and is incorporated herein by reference.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

24 unchanged sentences

and Latham Investment Holdings, L.P.

(incorporated by reference to Exhibit 2.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on June 3, 2021 (File No.

(incorporated by reference to Exhibit 2.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on June 3, 2021 (File No.

Amended and Restated Certificate of Incorporation of Latham Group, Inc.

(incorporated by reference to Exhibit 3.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on June 3, 2021 (File No.

(incorporated by reference to Exhibit 3.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on June 3, 2021 (File No.

Amended and Restated Bylaws of Latham Group, Inc.

(incorporated by reference to Exhibit 3.2 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on June 3, 2021 (File No.

Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.

Credit Agreement, dated as of December 18, 2018, among Latham Pool Products, Inc., Latham International Manufacturing Corp., the lenders party thereto and Nomura Corporate Funding Americas, LLC., as administrative agent (incorporated by reference to Exhibit 10.1 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

First Incremental Facility Amendment to the Credit Agreement, dated as of May 29, 2019, among Latham Pool Products, Inc., Latham International Manufacturing Corp., the lenders party thereto and Nomura Corporate Funding Americas, LLC, as administrative agent (incorporated by reference to Exhibit 10.2 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Second Incremental Facility Amendment to the Credit Agreement, dated as of October 14, 2020, among Latham Pool Products, Inc., Latham International Manufacturing Corp., the lenders party thereto and Nomura Corporate Funding Americas, LLC., as administrative agent (incorporated by reference to Exhibit 10.3 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Exhibit Description

Third Incremental Facility Amendment to the Credit Agreement, dated as of January 25, 2021 among Latham Pool Products, Inc., Latham International Manufacturing Corp., the lenders party thereto and Nomura Corporate Funding Americas, LLC., as administrative agent (incorporated by reference to Exhibit 10.4 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Fourth Incremental Facility Amendment to the Credit Agreement, dated as of March 31, 2021 among Latham Pool Products, Inc., Latham International Manufacturing Corp., the lenders party thereto and Nomura Corporate Funding Americas, LLC., as administrative agent (incorporated by reference to Exhibit 10.2 to Latham Group, Inc.’s Current Report on Form 8-K filed with the Commission on November 30, 2021 (File No.

Fifth Incremental Facility Amendment to the Credit Agreement, dated as of November 24, 2021 among Latham Pool Products, Inc., Latham International Manufacturing Corp., the lenders party thereto and Nomura Corporate Funding Americas, LLC., as administrative agent (incorporated by reference to Exhibit 10.1 to Latham Group, Inc.’s Current Report on Form 8-K filed with the Commission on November 30, 2021 (File No.

(incorporated by reference to Exhibit 3.2 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on June 3, 2021 (File No.

Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.1 to Latham Group, Inc’s Annual Report on Form 10-K filed with the SEC on March 10, 2022 (File No.

Credit and Guaranty Agreement, dated as of February 23, 2022, among Latham Pool Products, Inc., Latham International Manufacturing Corp., the other guarantors party thereto, the lenders and letter of credit issuers party thereto and Barclays Bank PLC, as administrative agent (incorporated by reference to Exhibit 10.1 to Latham Group, Inc.’s Current Report on Form 8-K filed with the SEC on February 23, 2022 (File No.

Stockholders Agreement by and among Latham Group, Inc.

and the stockholders party thereto, dated as of April 27, 2021 (incorporated by reference to Exhibit 10.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

and the stockholders party thereto, dated as of April 27, 2021 (incorporated by reference to Exhibit 10.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2021 (File No.

Registration Rights Agreement by and among Latham Group, Inc.

and the stockholders party thereto, dated as of April 27, 2021 (incorporated by reference to Exhibit 10.2 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

and the stockholders party thereto, dated as of April 27, 2021 (incorporated by reference to Exhibit 10.2 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2021 (File No.

Form of Indemnification Agreement by and among the Latham Group, Inc.

and each of its directors and executive officers (incorporated by reference to Exhibit 10.3 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

Employment Agreement by and between Scott Rajeski and Latham Pool Products, Inc., dated December 17, 2018 (incorporated by reference to Exhibit 10.8 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Offer Letter by and between J.

Mark Borseth and Latham Pool Products, Inc., dated February 7, 2020, as amended February 11, 2020 (incorporated by reference to Exhibit 10.9 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Employment Agreement by and between J.

Mark Borseth and Latham Pool Products, Inc., dated February 12, 2020, as amended April 6, 2020 (incorporated by reference to Exhibit 10.10 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

and each of its directors and executive officers (incorporated by reference to Exhibit 10.3 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2021 (File No.

Exhibit Description

Offer Letter by and between Joel R.

Culp and Latham Pool Products, Inc., dated January 18, 2019 (incorporated by reference to Exhibit 10.11 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Employment Agreement by and between Joel R.

Culp and Latham Pool Products, Inc., dated February 11, 2019 (incorporated by reference to Exhibit 10.12 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

Latham Pool Products, Inc.

Management Incentive Bonus Plan (incorporated by reference to Exhibit 10.4 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

Exhibit Description

Employment Agreement by and between Robert L.

Masson II and Latham Pool Products, Inc., dated June 9, 2022 (incorporated by reference to Exhibit 10.1 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on August 11, 2022 (File No.

Retirement Agreement by and between J.

Mark Borseth and Latham Pool Products, Inc., dated June 12, 2022 (incorporated by reference to Exhibit 10.2 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on August 11, 2022 (File No.

Latham Group, Inc.

2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.5 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

Form of Nonqualified Option Award Agreement under the 2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.6 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

Form of Restricted Stock Award Agreement under the 2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.7 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

Form of Restricted Stock Unit Award Agreement under the 2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.8 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the Commission on August 5, 2021 (File No.

Letter regarding Change in Certifying Accountant (incorporated by reference to Exhibit 16.1 to Latham Group, Inc.’s Registration Statement on Form S-1 filed with the Commission on April 15, 2021 (File No.

2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.5 to Latham Group, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2021 (File No.

Form of Restricted Stock Unit Award Agreement under the 2021 Omnibus Equity Incentive Plan dated March 2023

Form of Stock Appreciation Right Award Agreement under the 2021 Omnibus Equity Incentive Plan dated March 2023

Latham Group, Inc.

Non-Employee Director Compensation Plan

Form of Latham Group, Inc.

Management Incentive Bonus Plan

Subsidiaries of the registrant

Consent of RSM US LLP, independent registered public accounting firm

Consent of Deloitte & Touche LLP, independent registered public accounting firm

8 unchanged sentences

iXBRL Taxonomy Extension Calculation Linkbase Document

Exhibit Description

iXBRL Taxonomy Extension Definition Linkbase Document

1 unchanged sentence

iXBRL Taxonomy Extension Presentation Linkbase

Cover Page Interactive Data File (embedded within the Inline iXBRL document)

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

† Indicates management contract or compensatory plan.

* Filed herewith.

# Portions of this exhibit have been omitted pursuant to Item 601(a)(v) of Regulation S-K.

# Portions of this exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K.

** A signed original of the written statement required by Section 906 has been provided to the Company and will be retained by the Company and forwarded to the SEC or its staff upon request.

11 unchanged sentences

(Principal Executive Officer)

/s/ James Mark Borseth

/s/ Robert L.

Chief Financial Officer

March 7, 2023

James Mark Borseth

(Principal Financial Officer)

9 unchanged sentences

Dane Derbyshire

/s/ Christopher P.

March 7, 2023

Christopher P.

March 7, 2023

March 10, 2022

/s/ Robert D.

3 unchanged sentences

/s/ Suzan Morno-Wade

Suzan Morno-Wade

March 7, 2023

Suzan Morno-Wade

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