USAT USA Technologies Inc

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934

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Malvern, Pennsylvania

March 30, 2021

Important Notice regarding the Availability of Proxy Materials: the proxy statement and form of proxy card are available at: www.proxyvote.com

By Mail - If you received a paper copy of this proxy statement, you may vote by mail by signing, dating and mailing your proxy card in the envelope provided. You should sign your name exactly as it appears on the proxy card. If you are signing in a representative capacity (for example, as guardian, executor, trustee, custodian, or attorney or an officer of a corporation), you should indicate your name and title or capacity.

If you are a shareholder of record as of the record date for the Annual Meeting, you can participate in the Annual Meeting live online at www.virtualshareholdermeeting.com/USAT2021. The webcast will start on May 13, 2021 at 11:00 a.m., Eastern Time. You may vote and submit questions while attending the Annual Meeting online. You will need the sixteen-digit control number included on your Notice, on your proxy card or on the instructions that accompanied your proxy materials in order to be able to enter the meeting.

Street name shareholders must provide specific instructions on how to vote your shares by completing and returning the voting instruction form provided by your bank, broker, trustee or other nominee. Even if you plan to attend the virtual meeting, we encourage you to vote in advance by internet, telephone or mail so that your vote will be counted in the event you are unable to attend.

If your shares are held in “street name” through a broker, bank or other nominee, please refer to the instructions they provide regarding how to vote your shares or to revoke your voting instructions. If you hold your shares in the name of a broker, bank or other nominee, the availability of telephone and Internet voting depends on their voting processes. Street name holders may vote in person only if they have a legal proxy as described above.

As of March 15, 2021, there were 71,066,404 shares of Common Stock and 445,063 shares of Series A Preferred Stock of the Company. Only holders of Common Stock or Series A Preferred Stock of record at the close of business on March 15, 2021 will be entitled to vote. Each share of Common Stock is entitled to one vote and each share of Series A Preferred Stock is entitled to 0.1988 of a vote on all matters to come before the Annual Meeting, with any fractional vote being rounded to the nearest whole number. The number of votes to which each share of Series A Preferred Stock is entitled is equal to the votes attributable to that number of shares of Common Stock into which each share of Series A Preferred Stock is convertible. A majority of the Company’s outstanding shares as of the record date must be present at the meeting either in person or by proxy in order to hold the meeting and conduct business. This is called a quorum.

Your shares will be counted as present at the meeting if you:

It means that you have multiple accounts at the transfer agent and/or with a broker, bank or other nominee. Please vote all proxies to ensure that all your shares are represented at the meeting. In the future, you may wish to consolidate as many of your transfer agent accounts or accounts with brokers, banks or other nominees as possible under the same name and address for better customer service.

You may revoke your proxy and change your vote at any time before the polls close at the meeting. You may do this by:

Shares of Common Stock or Series A Preferred Stock represented by properly executed proxy cards, or voted by proxy over the Internet or telephone, and received in time for the Annual Meeting will be voted in accordance with the instructions specified in the proxies. Any proxy not specifying to the contrary will be voted (1) for the nine Board nominees in Proposal 1; (2) in favor of the ratification of Proposal 2; and (3) in favor of the recommendation in Proposal 3. If, for any unforeseen reason, any of our nominees is not available as a candidate for director, the persons named as proxy holders will vote your proxy for another candidate or other candidates nominated by our Board.

With respect to the election of each nominee for director, you may:

Directors will be elected by a majority of the votes cast by all holders of the issued and outstanding shares of Common Stock and Series A Preferred Stock voting together (with each share of Common Stock entitled to one vote, and each share of Series A Preferred Stock entitled to 0.1988 of a vote, with any fractional vote being rounded to the nearest whole number). Abstentions will not have any effect on the election of directors. Pursuant to the Company’s Director Majority Voting Policy, any nominee for director in an uncontested election who receives a greater number of votes “against” his or her election than votes “for” such election shall promptly submit to the Board a letter of resignation to the Secretary of the Company.

The Board may, by resolution, provide for a lesser number of directors or designate a substitute nominee. In the latter event, shares represented by proxies may be voted for a substitute nominee.

With respect to the proposal to ratify the appointment of BDO USA, LLP as the Company’s independent registered public accountants for the fiscal year ending June 30, 2021, you may:

The ratification of the appointment of the independent registered public accountants must receive the affirmative vote of a majority of shares present or represented by proxy at the meeting to pass.

With respect to the advisory vote to approve the compensation of the Company’s named executive officers, you may:

The proposal to approve the compensation of the Company’s named executive officers must receive the affirmative vote of a majority of shares present or represented by proxy at the meeting to pass.

If you return a signed card but do not provide voting instructions, your shares will be voted FOR the nine named director nominees, FOR the ratification of the appointment of the independent registered public accountants, and FOR approval of the compensation of the Company’s named executive officers. In addition, your proxy will be voted in the discretion of Mr. Feeney and/or Ms. Furnish with respect to any other business that properly comes before the meeting.

If you mark your voting instructions on the proxy card, your shares will be voted as you instruct.

Abstentions with respect to a proposal are counted for purposes of establishing a quorum. If a quorum is present, abstentions have no effect on the outcome of a vote on the election of directors, the ratification of the appointment of the independent registered public accountants or the approval of the compensation of the Company’s named executive officers.

If your shares are held in “street name” through a bank, broker or other nominee, your brokerage firm may vote your shares under certain circumstances if you do not provide voting instructions. These circumstances include certain “routine” matters, such as the ratification of the appointment of our independent registered public accountants. Therefore, if you do not vote your proxy, your brokerage firm may either vote your shares on routine matters or leave your shares unvoted. When a brokerage firm votes its customers’ unvoted shares on routine matters without receiving voting instructions, these shares are counted for purposes of establishing a quorum to conduct business at the meeting and in determining the number of shares voted FOR or AGAINST the routine matter.

Broker non-votes refer to shares of stock held in street name with regard to which the broker or other nominee holding them indicates on a proxy that the broker has not received instructions from the beneficial owner to vote those shares in a particular manner on a proposal for which the broker or other nominee does not have discretion to vote without specific instructions from the beneficial owner. Broker non-votes will be counted as present for purposes of determining the existence of a quorum but would not affect the outcome of the adoption of any proposal or the election of directors.

We will announce preliminary voting results at the meeting and will publish the final results in a Current Report on Form 8-K filed within four business days after the meeting. The report will be filed with the Securities and Exchange Commission (“SEC”), and you may obtain a copy by contacting the Corporate Secretary at (610) 989-0340 or through our website at www.usatech.com or the SEC’s EDGAR system at www.sec.gov.

We believe Mr. Bergeron’s extensive experience in the payments industry and his background in finance provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Douglas L. Braunstein. Age 60 and a director since April 2020. Mr. Braunstein has 35 years of leadership in banking and finance, currently serving as a Managing Partner and Founder of Hudson Executive Capital LP. During his tenure at JPMorgan Chase & Co., Mr. Braunstein served as CFO, Vice Chairman, a member of the Operating Committee, and Head of Americas Investment Banking and Global M&A, among other roles. Mr. Braunstein currently serves on the board of Cardtronics plc (CATM) and previously served as a director of Eagle Pharmaceuticals, Inc. and Corindus Vascular Robotics, Inc. Mr. Braunstein also serves as President and Chairman of Hudson Executive Investment Corp., a special purpose acquisition company formed to acquire a business in the financial services or healthcare sectors. Mr. Braunstein is a trustee of Cornell University, Chair of the Finance Committee and a member of Cornell’s Investment Committee. He received his B.S. from Cornell University and his J.D. from Harvard Law School.

We believe Mr. Braunstein’s experience and thought leadership in financial services provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Sean Feeney. Age 63 and a director since April 2020. Prior to joining the Company, Mr. Feeney was CEO of DefenseStorm, Inc., a cybersecurity management platform providing cloud-based and compliance-automated solutions to financial institutions. Previously, he served as CEO of GT Nexus, a cloud-based privately-owned supply chain platform, which was acquired by Infor. Prior to that, he was as an Operating Partner at Golden Gate Capital (GGC), a San Francisco-based private equity firm. While there, he advised on software-focused acquisitions, and also stepped in as Interim CEO for Critigen, a GGC portfolio company providing GPS consulting and data management IT services. He was also CEO at Inovis, until its sale to GXS in 2010 (OpenText), and earlier in his career held senior management positions at CheckFree which was acquired by Fiserv.

We believe Mr. Feeney’s strong track record of leadership in high-growth technology and payments companies, his extensive background in sales, and his unique understanding of our operations, opportunities and challenges provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Jacob Lamm. Age 56 and a director since April 2020. Mr. Lamm serves as the Chief Operating Officer of InVisionApp Inc., a digital product design platform. Mr. Lamm is founder and president of Enterik Advisory LLC, providing executive and board level consulting services with a focus on organic and inorganic growth strategies. He previously served as Executive Vice President of CA Technologies, a provider of information technology management software and solutions, from 2009 to 2019, where he was responsible for corporate strategy, M&A, venture investing, strategic alliances, and new business incubation. Prior to joining CA, he co-founded and served as CTO of Professional Help Desk, a provider of Service Management software that was acquired by CA. Additionally, Mr. Lamm has served as a director of both private and non-profit organizations, serving as a director for the Long Island High Technology Incubator, the New York State Smart Grid Consortium and Watermark Medical Inc., a medical technology company focused on remote diagnostic testing, therapy and patient follow-up, the latter from 2010 to 2018. Mr. Lamm earned a B.S. in computer information science from the City University of New York – Brooklyn College.

We believe Mr. Lamm’s extensive experience in high-growth technology companies provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Michael K. Passilla. Age 53 and a director since April 2020. Mr. Passilla served as Vice Chairman at Chase Merchant Services, the global payment processing division of JPMorgan Chase & Co, from 2016 to 2018. Prior to that, he was the Chief Executive Officer of Chase Merchant Services from 2013 to 2016. Mr. Passilla was the Chief Executive Officer and President of Elavon, Inc., a global payments processing firm, from 2010 to 2013. Mr. Passilla has been a member of the Board of Directors of Priority Technology Holdings, Inc., an IT service management company, since 2019. Mr. Passilla earned a BBA from the University of Notre Dame and earned an MBA from The J.L. Kellogg Graduate School of Management at Northwestern University.

We believe Mr. Passilla’s leadership experience and extensive knowledge of the payments industry provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Ellen Richey. Age 72 and a director since April 2020. Ms. Richey served as Vice Chairman of Risk and Public Policy of Visa Inc. (Visa), a global payments technology company, from 2014 to 2019, and as Chief Risk Officer from 2017 to 2019. In such roles, Ms. Richey oversaw risk management, including enterprise risk, settlement risk, operational resilience, internal audit, and risks to the integrity of the broader payments ecosystem, and served as a member of

Visa’s senior executive committee. During 2014, Ms. Richey concurrently served as Chief Legal Officer, assuming responsibility for the legal function in addition to her risk responsibilities. From 2007 to 2013, Ms. Richey served as Executive Vice President and Chief Enterprise Risk Officer. In that role, she was responsible for oversight of Visa’s compliance, audit and risk teams, including payment system risk, settlement risk and enterprise risk. Ms. Richey earned a B.A. in Linguistics and Far Eastern Languages from Harvard University (1970) and a J.D. from Stanford University (1977), and served as a law clerk for Associate Justice Lewis F. Powell, Jr., of the United States Supreme Court, from 1979 to 1980.

We believe Ms. Richey’s extensive experience in the payments industry and in risk management, compliance and audit provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Anne M. Smalling. Age 55 and a director since April 2020. Ms. Smalling has served as President and Managing Partner of HM International, LLC (HMI), a privately-held business that acquires undervalued assets and builds a steady trajectory of worth since 1999. As President and Managing Partner, Ms. Smalling provides oversight and supervision of the operating businesses in their succession, strategic planning, financing, acquisition and divestitures and major capital expenditures. Ms. Smalling currently serves as the Chair of the Boards of Directors of Quality Sausage Company, LLC, which is a leader in custom/proprietary pre-cooked meats and pepperoni supplying products to industrial and foodservice customers, since 2014, and American Innovations, a provider of compliance solutions to oil and gas pipelines thru an integrated family of hardware, software and professional services, since 2004. She also serves on the Boards of Directors of Igasamex, S. de R.L. de C.V., a developer of private natural gas distribution systems in Mexico, since 1995, Garrison Brothers, a bourbon distillery, since 2013, and rateGenius, Inc., a multi-state, web-based loan brokerage company, since 1999. She formerly served as Chairman of Windsor Quality Food Company, a leader in frozen food manufacturing for consumers and foodservice, from 2004 to 2014. Ms. Smalling earned a B.S. in Developmental Psychology from Cornell University (1987) and an MBA from Harvard Business School (1992).

We believe Ms. Smalling’s operational expertise and experience in strategic planning and financing in a broad range of industries, provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors.

Shannon S. Warren. Age 50 and a director since April 2020. Ms. Warren is the owner and principal of SSW Consulting LLC, which provides risk and finance advisory services. Ms. Warren was the Chief Control Officer of JPMorgan Chase & Co. (JPM), a global financial services firm, from 2012 to 2016. In this role, she established the Oversight and Control function, designed the framework for the identification and management of operational risk in all products and services offered by JPM, implemented more comprehensive operational risk management technology and managed supervisory regulatory relationships globally. Prior to this role, Ms. Warren was the Corporate Controller and held several additional finance roles at JPM since joining in 2000, and has expertise with accounting and financial reporting matters. Ms. Warren is a graduate of the University of Michigan and is a Certified Public Accountant (inactive).

We believe Ms. Warren’s extensive experience in the payments industry and in compliance and audit provide the requisite qualifications, skills, perspectives, and experiences to serve on our Board of Directors

The Company is organized under the laws of the Commonwealth of Pennsylvania and is governed by the Board. As permitted under Pennsylvania law and the Company’s Articles of Incorporation and Bylaws, the Board has established and delegated certain authority and responsibility to five standing committees: the Audit Committee, Compensation Committee, Compliance Committee, Finance Committee, and Nominating and Corporate Governance Committee. The Board annually reviews the membership of and the authority and responsibility delegated to each committee.

The Board is committed to sound business practices, transparency in financial reporting and effective corporate governance. The Board has adopted a number of governance guidelines and policies which are available on the Corporate Governance page in the ‘Investors’ section of the Company’s corporate website (www.usatech.com). The Board annually reviews the Company’s corporate governance policies and practices in light of the requirements of applicable law and the listing standards of Nasdaq. The Company’s Board meets regularly in executive sessions which are comprised of the independent directors. The Board has determined that all of the currently serving members of the Board other than Mr. Feeney are independent in accordance with the applicable listing standards of The NASDAQ Stock Market LLC.

The Board of Directors of the Company and the Board Committees collectively held a total of seventy-nine (79) meetings during the fiscal year ended June 30, 2020. Each member of the Board of Directors attended at least 75% of the aggregate number of meetings of the Board and Board Committees of which he or she was a member. The Company’s policy regarding directors’ attendance at the annual meeting of shareholders, as described in the Company’s Corporate Governance Guidelines, is that all directors are strongly encouraged to attend the Annual Meeting. All of our then directors attended the 2020 Annual Meeting.

The Board of Directors has a standing Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, Compliance Committee and Finance Committee.

The Audit Committee of the Board of Directors presently consists of Ms. Warren (Chair), Ms. Richey, and Ms. Smalling. The Board of Directors has determined that each member of the Audit Committee is independent as defined under the listing standards of The Nasdaq Stock Market LLC and under Rule 10A-3 of the Securities Exchange Act of 1934, as amended (“Exchange Act”).

Our Board of Directors has also determined that Ms. Warren is an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K. Other members of the Audit Committee also may be considered financial experts, but the Board has not so designated them. The Audit Committee engages the Company’s independent accountants, and is primarily responsible for approving the services performed by the Company’s independent accountants, for reviewing and evaluating the Company’s accounting principles, reviewing the independence of independent auditors, recommending to the Board of Directors that the audited financial statements be included in the Company’s annual Form 10-K, and for discussing with management and the independent auditor any major issues as to the adequacy of the Company’s internal controls and any special steps adopted in light of material control deficiencies. The Audit Committee met twenty-one (21) times during the 2020 fiscal year. The Audit Committee operates pursuant to a charter that was adopted by the Board of Directors on April 11, 2011, and amended on March 6, 2020, a copy of which is accessible on the Company’s website, www.usatech.com.

The Compensation Committee of the Board of Directors presently consists of Mr. Passilla (Chair), Ms. Baird, and Mr. Braunstein. The Board of Directors has determined that each of the current members of the Compensation Committee is independent in accordance with the applicable listing standards of The Nasdaq Stock Market LLC. The Committee reviews and recommends compensation and compensation changes for the executive officers of the Company and administers the Company’s incentive stock plans. The Compensation Committee met ten (10) times during the 2020 fiscal year. The Compensation Committee operates pursuant to a charter that was adopted by the Board of Directors in September 2007 and amended in May 2013, a copy of which is accessible on the Company’s website, www.usatech.com.

Our Compensation Committee annually reviews and recommends for approval by the Board corporate goals and objectives relevant to the Chief Executive Officer and other executive officers’ compensation, evaluates the Chief Executive Officer and other executive officers’ performance in light of those goals and objectives, and recommends for approval to the Board the Chief Executive Officer’s and other executive officers’ compensation levels based upon this evaluation. The Committee has the authority to retain or obtain the advice of a compensation consultant or other advisor, and to be directly responsible for the appointment, compensation and oversight of the work of any such advisor.

The Nominating and Corporate Governance Committee of the Board of Directors presently consists of Ms. Smalling (Chair), Ms. Baird, and Mr. Lamm. The Board of Directors has determined that each of the current members of the Nominating and Corporate Governance Committee is independent in accordance with the applicable listing standards of The Nasdaq Stock Market LLC. The Committee recommends to the entire Board of Directors for selection any nominees for director. The Nominating and Corporate Governance Committee met two (2) times during the 2020 fiscal year. The Nominating and Corporate Committee operates pursuant to a charter that was adopted by the Board of Directors on October 26, 2012, and amended October 8, 2019, a copy of which is accessible on the Company’s website, www.usatech.com.

The Nominating and Corporate Governance Committee is responsible for identifying and recommending for selection by the Board nominees for election or re-election to the Board, or to fill any vacancies on the Board. The Committee also reviews and makes recommendations to the Board on the range of skills and expertise and other appropriate criteria that should be represented on the Board. The Nominating and Corporate Governance Committee will generally consider all relevant factors in identifying and recommending candidates to the Board, which may include independence, expertise that is useful to the Company and complementary to the background, skills and experience of the other Board members, a commitment to ethics and integrity, a commitment to personal and organizational accountability, a history of achievement that reflects superior standards for themselves and others, and a willingness to express alternate points of view while, at the same time, being respectful of the opinions of others and working collaboratively as a team player. The Nominating and Corporate Governance Committee will consider the following qualifications that it believes would be useful in director candidates: transaction processing experience, experience in bringing technology to market, experience in building a growth company, sales leadership experience and diversity of background such as gender and ethnicity. The Nominating and Corporate Governance Committee does not have a formal policy with regard to the consideration of diversity in identifying director nominees, but the Committee strives to nominate directors with a variety of complementary skills so that, as a group, the Board will possess the appropriate backgrounds, perspectives, talent, skills, experience and expertise to oversee the Company’s business. The directors on the Company’s Nominating and Corporate Governance Committee use their available network of contacts when compiling a list of potential director candidates. The Nominating and Corporate Governance Committee also considers potential director candidates recommended by shareholders and other parties, including other directors, and all potential candidates are evaluated based upon the above criteria. The Nominating and Corporate Governance Committee makes no distinction in its evaluation of candidates based upon whether such candidates are recommended by shareholders or other parties.

Shareholders who wish to propose a potential director candidate may submit a recommendation in writing to the Secretary, USA Technologies, Inc., 100 Deerfield Lane, Suite 300, Malvern, Pennsylvania 19355, specifying the name of the candidate and stating in detail the qualifications of such person for consideration by the Nominating and Corporate Governance Committee. A written statement from the candidate consenting to be named as a candidate and, if nominated and elected, to serve as a director, should accompany any such recommendation.

The Compliance Committee of the Board presently consists of Ms. Richey (Chair) and Ms. Smalling. The Committee has oversight responsibility for the Company’s compliance functions and supervises the Company’s Chief Compliance Officer. The Compliance Committee also reviews and monitors significant compliance risk areas. The Compliance Committee met four (4) times during the 2020 fiscal year. The Compliance Committee operates pursuant to a charter that was adopted by the Board of Directors on December 21, 2018, a copy of which is accessible on the Company’s website, www.usatech.com.

The Finance Committee presently consists of Mr. Bergeron, Mr. Braunstein, Mr. Lamm (Chair), and Ms. Richey. The Finance Committee was formed on April 27, 2020. The Finance Committee reviews and approve matters related to financing activities of the Company. The Finance Committee met four (4) times during the 2020 fiscal year.

Management is responsible for managing the risks that the Company faces. The Board of Directors is responsible for overseeing management’s approach to risk management. Management identifies material risks facing the Company on an ongoing basis and discusses those risks with the Board of Directors or its Committees, as appropriate. While the Board of Directors has ultimate responsibility for overseeing management’s approach to risk management, various Committees of the Board assist it in fulfilling that responsibility. In particular, the Audit Committee assists the Board in its oversight of risk management in the areas of financial reporting, internal audit function, and compliance with legal and regulatory requirements related to financial reporting and auditing matters. The Compliance Committee reviews and monitors significant compliance risk areas and the steps management takes to monitor, control, and report such compliance risk exposures.

Our Board currently separates the offices of Chair of our Board and Chief Executive Officer (“CEO”) by appointing an independent, non-executive chair. Our Board believes that an independent Board Chair is appropriate at this time because it allows our CEO to focus on managing the business, and the Non-Executive Chair to provide independent leadership for the Board. The arrangement also facilitates our Board’s independent oversight of our executive officers’ management of strategic direction, operational execution, and business risk, thereby better protecting shareholder value. Mr. Bergeron currently serves as our Non-Executive Chair.

The Non-Executive Chair performs the duties and responsibilities set forth in the Charter of the Non-Executive Chair, including the following:

The text of the Charter of the Non-Executive Chair, which was adopted on January 13, 2019, is posted on our website at www.usatech.com.

Our Board of Directors has established a formal process for shareholders to send communications to the Board of Directors or individual directors. Shareholders may send communications to the Board of Directors or individual directors by e-mail at corporatesecretary@usatech.com, or by mail at 100 Deerfield Lane, Suite 300, Malvern, Pennsylvania 19355, Attn: Corporate Secretary.

All communications submitted under this policy will be received and processed by the Secretary of the Company and submitted to the Board or the requisite individual members of the Board, as appropriate, based on the facts and circumstances outlined in the communication. Communications may also be referred to other departments within the Company or to management rather than to the Board or any of its members. The Board of Directors has requested that certain items which are unrelated to the duties and responsibilities of the Board should generally not be furnished to the Board, such as product complaints, product inquiries, new product suggestions, resumes and other forms of job inquiries, surveys, business solicitations or advertisements, or communications which are primarily commercial in nature. In addition, material that is unduly hostile, threatening, illegal or similarly unsuitable will be excluded from distribution to the Board or any of its members. The Secretary will make available to any non-employee member of the Board any communication that is not distributed to the Board in accordance with the process described above at the director’s request.

The Board of Directors has adopted the Stock Ownership Guidelines (the “Guidelines”) for directors and executive officers. Pursuant thereto, the Chief Executive Officer is required to own shares of Common Stock with a value of at least three times his base salary, and the Chief Financial Officer and other executive officers are required to own shares of Common Stock with a value of at least one times his or her base salary. The executive officers have five years to attain such level of ownership. Each non-employee director is required to own shares of Common Stock with a value of at least five times the sum of his or her annual cash retainer as well as the retainer for serving on one (but not more than one) Committee of the Board. Each director has five years to comply following the commencement of his or her service on the Board. As of the date of this proxy statement, each executive officer and director is in compliance with the applicable stock ownership requirements or is in the applicable grace period for compliance. The Guidelines are posted on our website at www.usatech.com.

We have adopted a Code of Business Conduct and Ethics (the “Code of Conduct”) that applies to all of our directors, officers and employees. The Code of Conduct is posted on our website at www.usatech.com. The Board of Directors must grant any waiver from a provision of the Code of Conduct to any executive officer or director, and any such waiver will be disclosed as required by law or stock market regulation.

The Board of Directors of the Company has adopted a Director Majority Voting Policy. Pursuant to the policy, any nominee for director in an uncontested election who receives a greater number of votes “against” his or her election than votes “for” such election shall promptly submit to the Board a letter of resignation to the Secretary of the Company. The Nominating and Corporate Governance Committee will promptly consider the resignation and

recommend to the Board whether to accept the tendered resignation or reject it. In considering whether to accept or reject the resignation, the Nominating and Corporate Governance Committee would consider relevant factors such as the underlying reasons for the majority against vote, the length of service and qualifications of the director whose resignation is tendered, the director’s contributions to the Company, and compliance with listing standards. The Nominating and Corporate Governance Committee would then consider the resignation and make a recommendation to the Board. The Board would then act on the Nominating and Corporate Governance Committee’s recommendation, which may include acceptance or rejection of the tendered resignation. The text of the policy is posted on our website at www.usatech.com.

The Board of Directors adopted Corporate Governance Guidelines in May 2013, a copy of which is posted on our website at www.usatech.com. Highlights of our Corporate Governance Guidelines include:

Members of the Board who are not employees of the Company receive cash and equity compensation for serving on the Board, as reviewed and recommended by the Compensation Committee, with subsequent approval thereof by the Board.

In connection with the replacement of all but two members of the Board on April 26, 2020, our Compensation Committee and Board approved a new non-employee director compensation program, effective as of April 26, 2020. Under this new program, each non-employee director is paid an annual cash retainer of $50,000. The Chair of the Board is paid an additional annual cash retainer of $35,000, while the Chairs of the following Board committees are entitled to the following additional annual cash retainers: Audit Committee Chair: $15,000; Compensation Committee Chair: $10,000; Compliance Committee Chair: $10,000; Nominating and Governance Committee Chair: $7,500; and Finance Committee Chair: $7,500. No additional cash retainers are provided for non-Chair service on Board committees, and we do not pay our directors meeting attendance fees under the new program. Cash retainers are generally payable monthly in arrears; however, in light of the uncertainty created by the COVID-19 global pandemic, all cash retainers accrued for director service under the new program during calendar year 2020 were deferred and paid in early 2021.

In addition to these cash retainers, and reflective of the Compensation Committee’s and the Board’s belief that equity compensation is key in linking the interests of our non-employee directors and our executives with those of our shareholders, our non-employee directors serving on the Board after April 26, 2020 were granted an initial equity award on May 6, 2020, consisting of (i) an annual grant of RSUs with a value of approximately $100,000, vesting on the first anniversary of the grant date (but eligible for prorated vesting for each completed calendar quarter of service following the grant date), and (ii) a one-time initial grant of 120,000 stock options, with an exercise price of $6.49 per share, with 25% of such options vesting on the first anniversary of the grant date (but eligible for prorated vesting for each completed calendar quarter of service following the grant date), and the remaining 75% of such options vesting in equal quarterly installments over the three-year period following the first anniversary of the grant date.

Commencing with the Company’s 2021 annual meeting of shareholders, our non-employee directors will be eligible to receive an annual grant of RSUs worth approximately $100,000, vesting on the first anniversary of the grant date (but eligible for prorated vesting for each completed calendar quarter of service following the grant date).

Prior to April 26, 2020, the compensation program for the Company’s non-employee directors was as follows: (i) an annual retainer fee of $35,000 for serving on the Board; (ii) an additional annual fee of $7,500 for serving on the Audit Committee (but not Chair), of $7,500 for serving on the Compliance Committee (but not Chair), of $5,000 for serving on the Compensation Committee (but not Chair), and of $4,000 for serving on the Nominating and Corporate Governance Committee (but not Chair); (iii) an additional annual fee of $15,000 for serving as Chair of the Audit Committee, of $15,000 for serving as Chair of the Compliance Committee, of $10,000 for serving as Chair of the Compensation Committee, and of $8,000 for serving as Chair of the Nominating And Corporate Governance Committee; (iv) commencing on April 5, 2019, an additional fee of $1,000 for each Board or each Committee meeting attended in a fiscal year in excess of 8 meetings for the Board or the Committee, as the case may be; (v) an additional annual fee of $40,000 for serving as non-Executive Chair of the Board; and (vi) an annual stock award with a value, on the date of the grant, of $90,000. The annual fees were paid in quarterly installments, and directors could elect to receive such fees in Common Stock instead of cash. The stock award was generally granted on July 1st of each year, and prior to July 1, 2019, vested ratably over a two-year period. The July 1, 2019 award (the grant of which was delayed until October 2019) vested one-third on the date of the grant and two-thirds on the first anniversary of the date of the grant.

Our Stock Ownership Guidelines provide that each non-employee director should own shares of Common Stock with a value of at least five times his or her annual cash retainer. For this purpose, the annual retainer includes the annual retainer for service on the Board as well as the annual retainer for serving on one (but not more than one) Committee of the Board. Each non-employee director has five years to obtain such ownership from commencement of service as a director. As of the date hereof, each of our non-employee directors is in compliance with the policy or is within the grace period for compliance. For purposes of these guidelines, “shares” include shares owned by a non-employee director or by such person’s immediate family members residing in the same household, and include unvested restricted stock awards (but not unexercised stock options).

The following Compensation Discussion and Analysis (“CD&A”) provides information regarding our executive compensation philosophy, the elements of our executive compensation program, and the factors that were considered in the compensation actions and decisions for our named executive officers during fiscal 2020. The CD&A should be read together with the compensation tables and related disclosures set forth elsewhere in this proxy statement.

While this CD&A and the compensation tables and related disclosures provide information for the entirety of fiscal 2020, on April 26, 2020, approximately two months prior to the end of the fiscal year, all but two of the directors on the Board (and all of the directors serving on the Compensation Committee of the Board (the “Compensation Committee”)) were replaced. In addition, there were substantial changes in our management team throughout fiscal 2020 (and continuing through fiscal 2021). Therefore, the Compensation Committee (as currently constituted) has been actively restructuring our compensation programs throughout the end of fiscal 2020 (and continuing into fiscal 2021) to accommodate these management changes and to design and implement a program that the Compensation Committee believes will better align with the Company’s long-term strategic plan, reflect our pay-for-performance philosophy, encourage retention of key executives, and increase alignment between the interests of our executives and our shareholders.

During fiscal 2020, our named executive officers (“NEOs”) were as follows:

Throughout fiscal 2020, our management team underwent a number of key changes (and we have continued to add depth to our management structure in fiscal 2021). Following the departure of our former Chief Executive Officer, Stephen P. Herbert, on October 17, 2019, Donald W. Layden, Jr. served as our interim Chief Executive Officer, and then as our President and Chief Executive Officer, until Mr. Layden was succeeded by our current President and Chief Executive Officer, Sean Feeney, on May 8, 2020. In addition, Glen E. Goold, our former Chief Accounting Officer, served as our interim Chief Financial Officer in fiscal 2020 until he was succeeded by Michael Wasserfuhr on February 28, 2020, who served as our Chief Financial Officer until June 29, 2020. Anant Agrawal, our former Executive Vice President of Corporate Development, instead took on the role of Chief Revenue Officer on June 15, 2020, and Jeff Vogt, our former Senior Vice President of Business Affairs, instead took on the role of Chief Operating Officer, also on June 15, 2020, succeeding our former Chief Operating Officer, Matthew W. McConnell, who departed from the role on February 28, 2020. Our former Chief Marketing Officer, Maeve M. Duska, also departed from her role on May 8, 2020.

Continuing into fiscal 2021, we appointed an interim Chief Financial Officer, Eugene C. Cavanaugh, to succeed Mr. Wasserfuhr, effective as of July 1, 2020, and a permanent Chief Financial Officer, R. Wayne Jackson, to succeed Mr. Cavanaugh, effective as of August 10, 2020. As of July 6, 2020, Davina Furnish was appointed to serve as our General Counsel. Additionally, as of September 15, 2020, we appointed a new Chief Accounting Officer, Scott Stewart, who succeeded Mr. Goold, and Mr. Vogt departed as our Chief Operating Officer on January 15, 2021 as part of our streamlining in corporate structure. Finally, on January 20, 2021, the Company informed Mr. Pollock that his employment with the Company would end on July 20, 2021, in connection with the transitioning of his duties to Ms. Furnish.

For information regarding the employment agreements of our currently serving NEOs, and the separation arrangements for our departed NEOs, please see the below discussions under “- Executive Employment Agreements” and “Potential Payments upon Termination or Change of Control.”

As described above, in connection with the replacement of all but two members on the Board on April 26, 2020, the entire membership of the Compensation Committee was replaced with our current members, who include: Michael K. Passilla (Chair), Lisa P. Baird, and Douglas L. Braunstein. Our current Compensation Committee has been actively involved in restructuring our executive compensation programs in connection with the management changes noted above and to better reflect the Company’s philosophy that pay should be substantially connected with performance while encouraging long-term retention and functioning to align our executives’ incentives with our strategic plans and our shareholders’ interests. Although the current Compensation Committee believes that substantial strides have been made in our executive compensation programs since April 26, 2020, it is an evolving process as the Company continues to grow its management team and moves forward with its strategic plans.

The Compensation Committee is responsible for annually reviewing and recommending to the Board for approval the corporate goals and objectives relevant to the compensation of the executive officers of the Company, evaluating the executive officers’ performance in light of those goals and objectives, and recommending for approval to the Board the executive officers’ compensation levels based on this evaluation. From time to time, the Compensation Committee may seek input and recommendations from the Chief Executive Officer regarding the compensation of other executive officers; however, the Chief Executive Officer is not present during voting or deliberations on his compensation. The Compensation Committee is empowered to utilize the services of an independent compensation consultant; however, our current Compensation Committee does not retain a compensation consultant. As the Company’s management team and executive compensation programs continue to grow, the Compensation Committee may consider engaging a compensation consultant to assist with market analysis and program structure.

The Company’s compensation philosophy is designed to attract and retain key executives responsible for our success, reflect pay-for-performance, and align management’s interests with the creation of long-term shareholder value. The Compensation Committee believes that these goals are best accomplished by tying a significant portion of compensation to the achievement of performance goals and equity incentives.

In particular, the Compensation Committee believes that equity awards are an essential component of an effective compensation program, because they provide a direct link between our shareholders’ interests and our employees, executive officers, directors, and advisors. The Compensation Committee - and the Board - believe that this link is key to the future success of the Company, and have been working to implement changes in the Company’s compensation programs to emphasize equity compensation. Increased emphasis on equity compensation also enables the Company to conserve cash flow, which has become increasingly important in light of the COVID-19 pandemic and its effect worldwide. A more prominent role for equity compensation in our programs also enhances equity ownership in the Company by our employees, executive officers, and directors, which our Compensation Committee and Board believe is essential to increasing shareholder alignment. In fact, attractive equity compensation opportunities were a key piece of the arrangements put into place for our new Chief Executive Officer, Sean Feeney (and, in fiscal 2021, for our new Chief Financial Officer, R. Wayne Jackson), and of modifications to the compensation arrangements for certain of our other NEOs. The Compensation Committee firmly believes that the Company can best attract and retain key talent by providing attractive “upside” growth opportunity if our new leadership succeeds in improving our Company’s past performance, which is directly aligned with our shareholder interests. For further information on fiscal 2020 equity awards, please see the below discussion under “-Equity Awards.”

Other elements of our compensation program include base salary, annual bonuses, and limited perquisites. For more information, please see the below discussion under “-Elements of Compensation.”

Although the Compensation Committee may consider the compensation levels of our competitors in establishing executive compensation, in order to ensure that we are offering attractive and competitive opportunities to adequately retain our key employees, market comparison is only one factor in the Compensation Committee’s analysis. For this reason, executive compensation levels are not tied to any specific “benchmark” or other comparative level. The Compensation Committee does not presently maintain a formal, specific peer group of companies against which our compensation programs are compared, but may develop a prescribed peer group (either independently or with the assistance of an independent compensation consultant) as it continues on the path of enhancing our compensation programs and fiscal 2020 and 2021 management transitions are substantially completed.

At the 2020 Annual Meeting of Shareholders held on May 21, 2020, approximately 16% of our shareholders expressed support for the Company’s fiscal 2018 and fiscal 2019 NEO compensation programs through our advisory “say-on-pay” vote. However, the Board, after the April 26, 2020 membership changes, recommended that our shareholders vote against that proposal in a proxy statement supplement filed with the Securities and Exchange Commission on May 5, 2020. The Board’s recommendation related to the fact that none of the current Compensation Committee members were involved in establishing fiscal 2018 and 2019 compensation programs, and the current Board’s assessment that our executive compensation programs would substantially benefit from updating and revision, as described in more detail in this CD&A. In particular, as our management transitions are completed through fiscal 2020 and 2021 and our executive compensation programs evolve to fit our new go-forward strategy, our Compensation Committee is focused on increasing the emphasis of equity-based compensation to further link our executive compensation programs with shareholder interests and provide attractive equity growth opportunities to continue to attract and retain key talent, all in line with our pay-for-performance philosophy.

As our executive compensation programs continue to evolve, our Compensation Committee values shareholder feedback, and will consider any shareholder suggestions and commentary related to our compensation practices and structures, whether through our annual “say-on-pay” votes or otherwise.

Our compensation program for our executive officers features many commonly used “best practices” including:

Base salary is the fixed component of our NEOs’ annual cash compensation and is set with the goal of attracting and retaining talented executives and adequately compensating and rewarding them for services rendered during the fiscal year. The Compensation Committee reviews our NEOs’ base salaries on an annual basis. Base salaries are intended to reflect an individual’s level of responsibility and performance; however, the Compensation Committee also considers changes in duties and responsibilities, our business and financial results, and its knowledge of market practices in setting and adjusting base salaries.

Mr. Feeney was hired as our Chief Executive Officer at an initial base salary of $450,000. Mr. Goold’s base salary was established at $250,000 upon his appointment as Chief Accounting Officer on February 28, 2019; during Mr. Goold’s tenure as our interim Chief Financial Officer, he was an independent contractor (and not an employee) of the Company and was compensated as described below under “-Goold Offer Letter and Interim CFO Agreement.” Mr. Agrawal’s base salary in fiscal 2020 was $340,000, effective as of August 1, 2019 (prior to which Mr. Agrawal’s base salary was $280,000). Mr. Vogt’s base salary upon his hiring in October 2019 was set at $280,000 (increasing to $340,000 in connection with his promotion to Chief Operating Officer) and Mr. Pollock’s base salary during fiscal 2020 was set at $235,000. However, in light of the uncertainty created by the COVID-19 global pandemic, Messrs. Feeney’s, Goold’s, Agrawal’s, Vogt’s, and Pollock’s base salaries were reduced by 20% as part of an across-the-board reduction in salaries for members of our senior leadership team. These reductions remained in effect through December 31, 2020.

Prior to their departures from the Company, Messrs. Layden’s, Herbert’s, Wasserfuhr’s, and McConnell’s and Ms. Duska’s base salaries were $700,000, $525,000, $350,000, $400,000, and $280,000, respectively.

As we continue to finalize the build-out of our management team and our compensation program evolves, our current Compensation Committee intends that performance-based annual cash bonuses will be based on each NEO’s achievement of pre-established performance goals for each fiscal year. These annual bonuses would be intended to provide NEOs with an opportunity to receive additional cash compensation based on their individual performance and Company results, including the achievement of pre-determined Company and/or individual performance goals. Although the Compensation Committee intends that future bonus programs will incorporate pre-established performance metrics and goals, the Compensation Committee also believes that discretionary bonus elements may continue to be necessary as our management transitions are finalized.

Annual bonuses in respect of fiscal 2020 were awarded on a discretionary basis to the following NEOs, in the amounts summarized in the table below, based on each individual’s contributions (i) to our ethics and compliance culture, (ii) in guiding the Company through our management changes and go-forward business and strategic planning, and (iii) in supporting key initiatives:

Certain NEOs also received cash bonuses throughout fiscal 2020 in connection with individual retention arrangements, as described in further detail below under “-Executive Employment Agreements.” Mr. Feeney is only eligible for a cash bonus opportunity commencing with the fiscal 2021 year.

As described above, our current Compensation Committee believes that equity awards are an essential component of an effective compensation program, because they provide a direct link between our shareholders’ interests and our employees, executive officers, directors, and advisors. Our current Compensation Committee is therefore focused on emphasizing the important of equity compensation awards in setting executive compensation, as reflected in the awards made to key fiscal 2020 hires. In fiscal 2020, equity awards to our NEOs were primarily made as initial awards in connection with hires and promotions, as opposed to awards granted under a general annual program. The awards granted consisted of stock options, restricted stock, and restricted stock units (“RSUs”), and contained various time-based and performance-based vesting restrictions. Each NEO’s fiscal 2020 equity awards are described in further detail below:

In connection with our hiring of Mr. Feeney as our Chief Executive Officer, Mr. Feeney was awarded an initial inducement grant of 1,000,000 stock options on May 8, 2020, with an exercise price of $6.30 per share. Mr. Feeney’s options vest as follows: (i) 50% of the options are eligible to vest based on Mr. Feeney’s continued service in four equal installments on each anniversary of the grant date, (ii) 12.5% of the options are eligible to vest based on Mr. Feeney’s continued service on June 30, 2021, and (iii) an additional 12.5% of the options are eligible to vest on each of June 30, 2022, June 30, 2023, and June 30, 2024, subject in the case of this clause (iii) to the achievement of applicable performance goals for the fiscal year ending on each such date. On January 27, 2021, the Compensation Committee established these performance goals as a price target for the trading price of the Company’s common stock in each applicable fiscal year. The price target is achieved if the average closing price of the common stock during any consecutive 30-trading-day period during the applicable fiscal year meets or exceeds (i) $13.50, in the case of fiscal 2022, (ii) $16.50, in the case of fiscal 2023, and (iii) $19.50, in the case of fiscal 2024.

If at least 80% of the performance goals for an applicable fiscal year are achieved, the Compensation Committee may determine that the portion of the option eligible to vest based on such fiscal year’s performance will vest on a prorated basis. (In so determining, the Compensation Committee will consider the Company’s performance relative to its market competitors and any other considerations deemed relevant by the Compensation Committee. The Compensation Committee’s guideline is generally that, for every percentage point that the highest average closing price of the common stock during any consecutive 30-trading-day period during the applicable fiscal year is below

that fiscal year’s price target, the percentage of the performance options eligible to vest in respect of the applicable fiscal year should be reduced by 2%, but the Compensation Committee may vary this formula in its sole discretion.) In addition, any outstanding options are eligible for accelerated vesting upon a “change of control” of the Company, subject to Mr. Feeney’s continued employment with the Company as of immediately prior to the applicable transaction.

In connection with his commencement of employment as our Chief Accounting Officer, Mr. Goold was granted an award of 8,982 shares of restricted stock on February 28, 2020 that were originally scheduled to vest in three equal installments on each of the first three anniversaries of the grant date, generally subject to Mr. Goold’s continued employment on each such vesting date but which accelerated in connection with the end of his employment with us in fiscal 2021. See the below discussion under “Looking Ahead: Further Management Changes in Fiscal 2021-Chief Accounting Officer Changes” for further details.

On October 16, 2019, Mr. Agrawal was granted an award of 3,595 shares of restricted stock under the Company’s 2018 long-term incentive program, 2,396 of which were vested immediately upon grant and the remaining 1,199 of which were vested on June 30, 2020. In addition, on May 29, 2020, Mr. Agrawal was granted an award of 16,260 RSUs, which vested on December 31, 2020.

On November 22, 2019, Mr. Vogt was granted an award of 25,000 shares of restricted stock and a stock option to purchase 25,000 shares at an exercise price of $6.28 per share, each of which was originally scheduled to vest in three equal installments on each of the first three anniversaries of the grant date, generally subject to Mr. Vogt’s continued employment on each such vesting date, but which accelerated in connection with the end of his employment with us in fiscal 2021. See the below discussion under “Looking Ahead: Further Management Changes in Fiscal 2021-Chief Accounting Officer Changes” for further details.

On October 7, 2019, Mr. Pollock was granted a stock option to purchase 5,760 shares at an exercise price of $7.43 per share, one-third of which was fully vested upon grant, one-third of which vested on June 30, 2020, and the remaining one-third of which vests on June 30, 2021, generally subject to Mr. Pollock’s continued service through such date. In addition, on November 22, 2019, Mr. Pollock was granted a stock option to purchase 15,000 shares at an exercise price of $6.28 per share, vesting in three equal installments on each of the first three anniversaries of the grant date, generally subject to Mr. Pollock’s continued service through each such date.

In connection with his engagement as the Company’s interim Chief Executive Officer, Mr. Layden was granted a fully vested stock option on October 17, 2019 to purchase 225,000 shares at an exercise price of $7.18 per share. Mr. Layden was additionally granted 186,916 shares of restricted stock on February 28, 2020; such restricted shares were originally scheduled to vest based on Mr. Layden’s continued service over a four-year period, but were forfeited in their entirety upon Mr. Layden’s departure. See the below discussion under “Executive Employment Agreements-Layden Separation Agreement” for further details. In addition, Mr. Layden received a grant of restricted shares in October 2019 in respect of his service as a non-employee director prior to his appointment as our interim Chief Executive Officer, a portion of which was forfeited upon his departure; further information is provided below under the heading “Compensation of Non-Employee Directors.”

In connection with Mr. Herbert’s departure from employment, Mr. Herbert was granted 16,823 vested shares in satisfaction of his participation in the Company’s 2018 long-term incentive program. For further information, please see the below discussion under “Executive Employment Agreements-Herbert Separation Agreement.”

Mr. Wasserfuhr received an initial grant of 16,767 shares of restricted stock in connection with his appointment as Chief Financial Officer on February 28, 2020, which were originally scheduled to vest based on Mr. Wasserfuhr’s continued service over a three-year period; however, these shares were forfeited upon his departure from the Company.

On October 9, 2019, Mr. McConnell received a grant of 6,191 shares of restricted stock, one-third of which vested on November 21, 2019 and the remaining two-thirds of which were originally scheduled to vest based on Mr. McConnell’s continued service in equal installments on each of June 30, 2020 and June 30, 2021; however, such remaining two-thirds were forfeited upon his departure as an employee. In addition, on November 22, 2019, Mr. McConnell was granted (i) a stock option to purchase 20,000 shares at an exercise price of $6.28 per share, which was originally scheduled to vest in equal installments on each of the first three anniversaries of the grant date, and (ii) 20,000 restricted shares that were originally scheduled to vest in equal installments on each of the first three anniversaries of the grant date, each of which were also forfeited upon such departure.

On November 22, 2019, Ms. Duska received a grant of 7,500 shares of restricted stock, which were originally scheduled to vest based on Ms. Duska’s continued service in equal installments on each of the first three anniversaries of the grant date, but which were forfeited upon Ms. Duska’s departure from the Company.

Perquisites do not make up a significant portion of NEO compensation. Our NEOs are generally entitled to participate in the health care coverage, group insurance, and other employee benefits (e.g., 401(k) plan) broadly available to our other employees.

In connection with Mr. Agrawal’s relocation from California to the Philadelphia metropolitan area, in February 2018, the Company and Mr. Agrawal entered into an amendment to his employment agreement which provided for reimbursement of moving expenses, a housing allowance of $6,000 per month, and a car allowance of $500 per month for 20 months. The Company also provided additional payments to cover the taxes applicable to the housing and car allowance. However, in July 2019, Mr. Agrawal relocated back to California, and in accordance with a further amendment to his employment agreement, the housing allowance and car allowance were terminated.

During his tenure as interim Chief Executive Officer, Mr. Layden was provided an additional housing, travel, and living allowance of $15,000 per month (plus payment for applicable taxes associated with this allowance), and Mr. Goold was provided use of Company-leased housing from July 28, 2019 until July 27, 2020.

Our NEOs who remain employed with us are party to employment agreements or offer letters with us. These arrangements provide our NEOs with severance protection in the case of a termination without “cause” or, in certain cases, a resignation for “good reason,” which in certain cases is enhanced if such termination occurs in connection with a “change of control.” The Compensation Committee believes that a market level of severance protection allows our NEOs to focus on performing their day-to-day tasks and enhancing value for our shareholders without fearing a loss of financial security as a result of a termination (or constructive termination). Certain of our NEOs that departed from the Company during fiscal 2020 entered into separation agreements with us providing them with severance payments and benefits. These employment arrangements and separation agreements are described in further detail below; for more information, please also see the “Summary Compensation Table” below and the below discussion of “Potential Payments upon Termination or Change of Control.”

Mr. Feeney entered into an employment agreement with us in connection with his commencement of employment on May 8, 2020. In addition to his base salary, the employment agreement provides Mr. Feeney with an annual cash bonus opportunity, commencing with our fiscal 2021 year, with a target of 100% of Mr. Feeney’s base salary and a maximum of 150% of Mr. Feeney’s base salary. For fiscal 2021 only, such bonus will be payable at a minimum of 50% of Mr. Feeney’s base salary.

If Mr. Feeney is terminated by us without “cause,” or resigns his employment for “good reason,” then, subject to his execution of a release of claims and continued compliance with the covenants in his employment agreement, Mr. Feeney is eligible to receive a severance package consisting of 12 months of continued base salary, senior executive-level outplacement support for 12 months, and up to a 12-month COBRA subsidy. However, if such termination occurs within 24 months following a “change of control,” then Mr. Feeney will instead be provided a lump sum payment equal to his base salary plus last annual bonus paid in the fiscal year completed prior to such termination. (Under Mr. Feeney’s employment agreement, if Mr. Feeney becomes entitled to receive payments or benefits that would be subject to the excise tax under Section 4999 of the Internal Revenue Code of 1986, as amended, the payments and benefits would be reduced such that the excise tax does not apply, unless Mr. Feeney would be better off on an after-tax basis receiving all of the payments and benefits and paying the applicable excise tax.)

Mr. Feeney’s employment agreement contains customary restrictive covenants, including perpetual confidentiality, non-disparagement, and intellectual property covenants, as a well as a non-compete, non-solicit of customers and suppliers, and non-solicit of employees (including a no-hire) that each apply during employment and for two years following any termination.

In connection with his commencement of his employment with us as our Chief Accounting Officer, Mr. Goold entered into an offer letter with us. In addition to Mr. Goold’s base salary, the offer letter provided Mr. Goold with an annual cash bonus opportunity, in a target amount of 30% of Mr. Goold’s base salary, and an annual target equity award equal to 30% of Mr. Goold’s base salary.

Upon Mr. Goold’s termination by us without “cause,” then, subject to Mr. Goold’s execution of a release of claims, the offer letter provided Mr. Goold with six months of continued base salary as severance (which Mr. Goold was provided in connection with his termination of employment as further described below under “Looking Ahead: Further Management Changes in Fiscal 2021-Chief Accounting Officer Changes”). Mr. Goold is also subject to customary restrictive covenants, including a perpetual confidentiality covenant, and a one-year post-employment non-compete, non-solicit of customers, and non-solicit of employees (including a no-hire).

Prior to becoming employed as our Chief Accounting Officer, Mr. Goold was an independent contractor serving as our interim Chief Financial Officer. Pursuant to Mr, Goold’s written arrangement with the Company, Mr. Goold’s compensation as interim Chief Financial Officer consisted of the following: (i) a cash payment of $35,000 per month, plus approximately $2,100 per month in COBRA reimbursements, (ii) a cash bonus of $105,000 (increased to $200,000 when Mr. Goold’s tenure as our interim Chief Financial Officer was extended in May 2019) upon the Company achieving compliance with its periodic filing obligations (which bonus was paid in October 2019), and (iii) in connection with the extension of Mr. Goold’s tenure in May 2019, a $100,000 retention bonus if Mr. Goold continued to serve as interim Chief Financial Officer through December 31, 2019.

Upon his commencement of employment with us on November 9, 2017, Mr. Agrawal entered into an employment agreement with an initial term of one year, which is automatically renewed for consecutive one-year periods unless terminated by either Mr. Agrawal or the Company upon at least 90 days’ notice prior to the end of the then-current term. In addition to his base salary, Mr. Agrawal’s employment agreement provides for participation in our annual cash bonus program (with a fiscal 2020 target of 48% of Mr. Agrawal’s base salary) and annual equity award program (with a fiscal 2020 target equal to 100% of Mr. Agrawal’s base salary). (As further described above under “-Perquisites and Other Personal Benefits,” until July 1, 2019, Mr. Agrawal’s employment agreement had also provided him with a housing allowance of $6,000 per month and car allowance of $500 per month, with additional payments to cover taxes applicable to these allowances.) The employment agreement also provided Mr. Agrawal with a retention bonus of $420,000, payable in 2 equal installments on each of the first two anniversaries of Mr. Agrawal’s commencement date (the final payment of which was made in November 2019).

If Mr. Agrawal’s employment is terminated by us without “cause,” or if Mr. Agrawal resigns for “good reason,” then, in addition to a prorated target annual bonus and prorated annual equity award, Mr. Agrawal would, subject to his execution of a release of claims, be eligible to receive a severance package consisting of (i) 12 months of continued base salary, and (ii) a 12-month COBRA subsidy (plus additional payments to cover taxes applicable to such COBRA subsidy).

Mr. Agrawal’s employment agreement also contains customary restrictive covenants, including perpetual confidentiality, intellectual property, and reciprocal non-disparagement covenants, a three-year non-compete (expiring on November 9, 2020), and a one-year post-employment non-solicit of employees and customers.

In connection with his commencement of employment, Mr. Vogt entered into an offer letter with us. In addition to his base salary, the offer letter provided Mr. Vogt with an annual cash bonus opportunity (most recently with a target equal to 50% of Mr. Vogt’s base salary). The offer letter did not provide any payments or benefits in connection with a termination of employment, however Mr. Vogt was provided with a limited severance package in connection with his termination of employment in fiscal 2021, as further described below under “Looking Ahead: Further Management Changes in Fiscal 2021-Departure of Chief Operating Officer and Chief Compliance Officer.”

In connection with his commencement of employment as our Chief Compliance Officer on April 15, 2019, Mr. Pollock entered into an offer letter with us. In addition to his base salary, the offer letter provides Mr. Pollock with an annual cash bonus opportunity in a target amount equal to 30% of Mr. Pollock’s base salary and an annual target equity award equal to 20% of Mr. Pollock’s base salary. In addition, Mr. Pollock was paid a cash signing bonus of $30,000 in August 2019 under the terms of the offer letter. The offer letter generally provides that USAT will provide Mr. Pollock with six months’ notice of termination of employment (other than a termination for “cause”) which notice was provided to Mr. Pollock on January 20, 2021. Mr. Pollock’s offer letter also contains a customary perpetual confidentiality covenant.

On May 10, 2020, Mr. Layden agreed to resign his employment with us, effective as of May 8, 2020. Pursuant to a separation agreement with us, Mr. Layden received no severance pay or other separation benefits, but retained the 225,000 vested options described above (and 4,405 shares of restricted stock granted in connection with his service as a non-employee director prior to being appointed as our interim Chief Executive Officer that were vested upon grant). The agreement contained a release of claims by Mr. Layden and, on a limited basis, by the Company, as well as perpetual confidentiality and reciprocal non-disparagement covenants, and a one-year post-employment non-solicit of customers and employees.

In connection with Mr. Herbert’s departure on October 17, 2019, Mr. Herbert was provided with the following separation payments and benefits: (i) a lump sum severance payment of $400,000, (ii) full vesting of equity awards issued pursuant to the Company’s 2018 long-term incentive program, (iii) a COBRA subsidy through February 28, 2021, and (iv) payment by the Company for outplacement transition services in an amount not to exceed $50,000. Mr. Herbert’s separation agreement contained a release of claims by Mr. Herbert and, on a limited basis, by the Company, as well as perpetual confidentiality and reciprocal non-disparagement covenants, and a one-year post-employment non-compete and non-solicit of clients, customers, and employees.

Mr. Wasserfuhr’s employment was terminated by the Company on June 29, 2020. Mr. Wasserfuhr was offered a separation package in connection with this separation; however, in March 2021, the Company entered into a settlement and mutual release agreement with Mr. Wasserfuhr, pursuant to which the Company agreed to pay Mr. Wasserfuhr a settlement payment of $375,000 plus reimbursement of $105,000 in attorney’s fees in exchange for Mr. Wasserfuhr’s release of claims.

In connection with Mr. McConnell’s departure on February 28, 2020, Mr. McConnell entered into a consulting arrangement with the Company through August 31, 2020, pursuant to which the Company continued payment of Mr. McConnell’s base salary and employee benefits through May 31, 2020, and granted him 15,000 shares of common stock at the conclusion of his engagement on August 31, 2020.

In connection with Ms. Duska’s departure from the Company on May 8, 2020, Ms. Duska entered into a separation and transition services agreement with us. Pursuant to Ms. Duska’s agreement, Ms. Duska forfeited all vested and unvested equity awards issued by the Company (other than vested stock options originally issued to Ms. Duska in January 2015), but, in exchange for a three-year transition services arrangement, the Company will pay to Ms. Duska (in addition to a six-month COBRA subsidy) (i) $12,500 per month during the first year of the arrangement, (ii) $7,500 per month during the second year of the arrangement, and (iii) $2,500 per month during the third year of the arrangement. However, these payments are subject to offset for any future income from employment that Ms. Duska secures. Ms. Duska’s agreement contained a release of claims by Ms. Duska, as well as customary perpetual confidentiality and reciprocal non-disparagement covenants, and a three-year post-employment non-compete and non-solicit of employees and customers.

As described above, the Compensation Committee believes that equity ownership in the Company by our executive officers is essential to increasing shareholder alignment. The Company’s Stock Ownership Guidelines support this belief by providing that the Chief Executive Officer is required to hold Common Stock with a value equal to a multiple of three times his base salary and our Chief Financial Officer and other executive officers are required to hold Common Stock with a value equal to his or her base salary. Each executive officer has five years to satisfy the applicable guideline following his or her appointment as an executive officer. As of the date hereof, each of our NEOs who remain employed with us are in compliance with the policy or are in the grace period for compliance.

For purposes of these guidelines, “shares” include shares owned by the executive officer or by such person’s immediate family members residing in the same household, and include unvested restricted stock awards (but not unexercised stock options).

As described above, in July 2019, we adopted our Clawback Policy, which provides that in the event of a restatement of the Company’s financial results (other than due to a change in applicable accounting methods, rules, or interpretations), the result of which is that any incentive compensation paid, settled, or awarded to an executive officer after July 1, 2019 would have been lower or none at all had it been calculated based on such restated results, the Company can seek return of any overpayment of incentive compensation paid to an executive officer based on such restated results; provided, however, that the executive officer must have engaged in intentional misconduct that contributed to the need for the restatement.

In July 2019, the Board adopted an Anti-Hedging Policy. The policy prohibits our employees, officers, and directors from engaging in any hedging or similar transactions with respect to the Company’s securities, including through the establishment of a short position in the Company’s securities, that are designed to or that may reasonably be expected to have the effect of hedging or offsetting a decrease in the market value of the Company’s securities.

The Compensation Committee takes into account tax and accounting consequences of our executive compensation program and weighs these factors when setting total compensation and determining the individual elements of any NEO’s compensation package.

In particular, Section 162(m) of the Internal Revenue of 1986, as amended, generally precludes a publicly held corporation from a federal income tax deduction for a taxable year of compensation in excess of $1 million paid to its “covered employees,” which generally include its chief executive officer, chief financial officer, its next three most highly compensated executive officers, and any individual who is or was a “covered employee” for any taxable year beginning after December 31, 2016. However, the deductibility of compensation is only one of a myriad of factors that the Compensation Committee takes into account when setting executive compensation, and we and our Compensation Committee firmly believe that it is important for the Company to retain flexibility to pay compensation to our employees (including our NEOs) that appropriately achieves our goals of incentivizing retention, paying for performance, and aligning compensation with shareholder interests, even if the deductibility of that compensation is limited (whether under Section 162(m) or otherwise).

We have continued to add to the depth of our executive leadership team in fiscal 2021, including with the appointment of Eugene C. Cavanaugh as our interim Chief Financial Officer, effective as of July 1, 2020. Mr. Cavanaugh’s compensation arrangement with the Company included (i) $15,000 per month in cash, and (ii) 3,000 shares of vested Common Stock per month of service, in each case prorated for any partial month. Mr. Cavanaugh’s engagement with the Company was scheduled to end upon the appointment of our permanent Chief Financial Officer on August 10, 2020 (as described below), but Mr. Cavanaugh agreed to continue to provide consulting services to the Company’s finance and accounting functions and its executive management under the same compensation terms, until the arrangement ended on October 15, 2020.

On August 10, 2020, the Company appointed R. Wayne Jackson as the Company’s permanent Chief Financial Officer. Under his employment agreement with the Company, Mr. Jackson’s base salary is $280,000 per year, increasing to $350,000 per year on January 1, 2021, and his annual target bonus opportunity is equal to 50% of base salary, with a maximum bonus opportunity of 150% of the target bonus (with a minimum fiscal 2021 bonus of $175,000). In addition, Mr. Jackson was awarded an initial equity grant of 400,000 stock options, with an exercise price of $7.10 per share, which are eligible to vest as follows: (i) 50% of the options are eligible to vest in three equal annual installments on the first three anniversaries of the grant date, and (ii) the remaining 50% of the options are eligible to vest in three equal installments on each of June 30, 2021, June 30, 2022, and June 30, 2023, subject to the achievement of performance goals for the fiscal year ending on each such date and in each case subject to Mr. Jackson’s continued employment through the applicable vesting date. On January 27, 2021, these goals were established by the Compensation Committee as the same goals applicable to Mr. Feeney’s fiscal 2022 and fiscal 2023 performance options described above (and a price target applicable to Mr. Jackson’s fiscal 2021 performance options of $10.50 (based on average closing price for a consecutive 30-day trading period). If at least 80% of the performance goals for an applicable fiscal year are achieved, the Compensation Committee may determine that the portion of the option eligible to vest in respect of such fiscal year will vest on a prorated basis, as described above with respect to Mr. Feeney’s performance options. In addition, any of the stock options then-outstanding and unvested will immediately vest upon a “change of control,” subject to Mr. Jackson’s continued employment as of immediately prior to the “change of control.”

Under Mr. Jackson’s employment agreement, if Mr. Jackson is terminated without “cause” or resigns for “good reason”, then subject to Mr. Jackson’s execution of a release of claims and continued compliance with the covenants in his employment agreement, Mr. Jackson will be provided a severance package consisting of (i) continued base salary at the monthly rate then in effect during the “Severance Period” (as defined below), (ii) senior executive-level outplacement counseling and support services during the Severance Period, and (iii) a COBRA subsidy during the Severance Period. The “Severance Period” means (x) zero months, if such termination occurs on or prior to January 31, 2021, (y) three months, if such termination occurs between February 1, 2021 and August 10, 2021, or (z) six months, if such termination occurs on or after August 11, 2021. However, if such termination occurs within 24 months following a “change of control,” then Mr. Jackson will instead be provided a lump sum payment equal to the sum of his base salary and last annual bonus paid in the fiscal year completed prior to such termination.

Mr. Jackson’s employment agreement contains customary restrictive covenants, including perpetual confidentiality, non-disparagement, and intellectual property covenants, as well as a non-compete, non-solicit of customers and suppliers, and non-solicit of employees (including a no-hire) that each apply during employment and for two years following any termination.

As described above, Mr. Goold’s tenure as our Chief Accounting Officer ended on September 15, 2020, in connection with our appointment of Scott Stewart as our new Chief Accounting Officer (as described below). Pursuant to a separation agreement with the Company, Mr. Goold’s employment with the Company ended on October 30, 2020. Through such date, Mr. Goold continued to provide services to the Company, including assistance with the transition of his duties to Mr. Stewart. Under his separation agreement, subject to execution of a release, Mr. Goold was provided with the following payments and benefits (in addition to payment for his accrued but unpaid base salary and paid time off) following his termination of employment, which were consistent with Mr. Goold’s preexisting arrangements with the Company (as described below under “Potential Payments Upon Termination or Change Of Control”): (i) $125,000 in cash severance, payable on the Company’s regular payroll schedule over a six-month

period, and (ii) full vesting of Mr. Goold’s outstanding restricted stock awards. Pursuant to a July 2020 retention arrangement with Mr. Goold, the Company paid Mr. Goold a cash bonus of $45,000 in three equal installments on each of July 24, 2020, August 21, 2020, and September 18, 2020, which bonus he was entitled to retain in connection with his separation from the Company. Mr. Goold remains subject to the confidentiality, non-competition, and non-solicitation covenants in his offer letter with the Company (as described above under “Goold Offer Letter and Interim CFO Agreement”), and in addition, has agreed to perpetual cooperation and reciprocal nondisparagement covenants with the Company.

On August 6, 2020, the Company entered into an offer letter with Scott Stewart, appointing Mr. Stewart as our Chief Accounting Officer, effective as of September 15, 2020. The offer letter provides Mr. Stewart with a base salary of $275,000 per year (reduced by 20% through December 31, 2020 as part of the Company’s COVID-19-related executive compensation reductions), a target bonus opportunity for fiscal 2021 equal to $125,000 (with a minimum fiscal 2021 bonus of $62,500), and an annual equity award opportunity of up to 20% of his base salary. Mr. Stewart also received a one-time cash signing bonus of $50,000 after he had been employed with the Company for 30 days. Pursuant to his offer letter, Mr. Stewart was also awarded an initial equity grant of 125,000 stock options, with an exercise price equal to $8.58. Fifty percent of the stock options will be eligible to vest in three equal annual installments on the first three anniversaries of September 15, 2020, subject to Mr. Stewart’s continued employment through the applicable vesting date. The remaining 50% of the options will also be eligible to vest in three equal installments on the first three anniversaries of September 15, 2020, subject to Mr. Stewart’s continued employment through the applicable vesting date and subject to achievement of the same performance goals as applicable to Mr. Jackson’s performance options, as described above. Mr. Stewart’s offer letter also contains customary restrictive covenants, including a perpetual confidentiality covenant, as well as a non-compete, non-solicit of customers, and non-solicit of employees that each apply for one year following any termination.

As part of the streamlining of our corporate structure, the positions of Chief Operating Officer and Chief Compliance Officer were eliminated. On January 11, 2021, we entered into a separation and transition agreement with Mr. Vogt, and his last day of employment with the Company was January 15, 2021. In exchange for a release of claims, Mr. Vogt received two weeks of base salary payments and full vesting of the remaining unvested portion of the stock options and restricted shares granted to him on November 22, 2019 and December 2, 2019, respectively. All of Mr. Vogt’s other unvested equity awards were forfeited in connection with his termination of employment. The separation agreement also contains a non-competition covenant and non-solicitation of clients and employees covenants that are in effect for one year following Mr. Vogt’s termination. In addition, Mr. Vogt agreed to a reciprocal non disparagement covenant with the Company. Following the end of Mr. Vogt’s employment, he was engaged as a consultant through February 13, 2021 in order to more seamlessly transition his duties. Under the consulting arrangement, he received compensation of $164 per hour.

As described above, Mr. Pollock was provided with the six months’ notice of termination of his employment on January 20, 2021. Mr. Pollock will assist with the transition of his duties to Davina Furnish, our General Counsel, until his employment ends on July 20, 2021.

Messrs. Feeney, Agrawal, and Pollock are entitled (and Mr. Goold was entitled) to certain severance payments and benefits upon a termination without “cause,” or, where applicable, a resignation for “good reason,” as further described above under “Executive Employment Agreements.” In addition, under the general terms of our equity award plans, a participating employee is entitled to “double-trigger” accelerated vesting of outstanding equity awards if such employee is terminated by us without “cause,” or, to the extent provided in the employee’s award agreement, if the employee resigns for “good reason,” in each case within 18 months following a “change of control.” Mr. Feeney’s initial option award is subject to accelerated vesting upon a “change of control,” and Mr. Agrawal’s fiscal 2020 RSU grant was subject to accelerated vesting upon Mr. Agrawal’s termination by us without “cause” or Mr. Agrawal’s resignation for “good reason,” each as more fully described above under “Equity Awards-Sean Feeney” and “-Anant Agrawal,” respectively. The following table summarizes these potential payments and benefits, with all equity estimates based on the closing price of our Common Stock on June 30, 2020 ($7.01) and assuming that the applicable termination event or “change of control” occurred on the last day of fiscal 2020, June 30, 2020:

As described above in the discussion under “-Executive Employment Agreements,” Messrs. Layden and Wasserfuhr were not provided with a severance package in connection with their respective departures; however, as noted above under “Wasserfuhr Departure,” in March 2021, the Company entered into a settlement and mutual release agreement with Mr. Wasserfuhr, pursuant to which the Company agreed to pay Mr. Wasserfuhr a settlement payment of $375,000 plus reimbursement of $105,000 in attorney’s fees in exchange for Mr. Wasserfuhr’s release of claims.

Pursuant to his separation agreement with the Company, Mr. Herbert was provided with the following severance payments and benefits: (i) $400,000 in lump sum cash severance, (ii) $108,508 in vested equity granted pursuant to the Company’s 2018 long-term incentive program, (iii) $24,373 in COBRA reimbursements, and (iv) outplacement transition services worth $50,000.

As noted above, in exchange for her three-year transition services arrangement, the Company will pay to Ms. Duska (in addition to a six-month COBRA subsidy worth $10,818) (i) $12,500 per month during the first year of the arrangement, (ii) $7,500 per month during the second year of the arrangement, and (iii) $2,500 per month during the third year of the arrangement. However, these payments are subject to offset for any future income from employment that Ms. Duska secures.

As also described above, pursuant to a consulting arrangement Mr. McConnell entered into with us in connection with his separation, the Company paid Mr. McConnell $89,231 in continued base salary payments through May 31, 2020 (and continued his participation in our employee benefit programs through that date), and, subject to Mr. McConnell’s providing consulting services to the Company through August 31, 2020, will provide him a grant of 15,000 shares of common stock at the conclusion of his engagement.

As required by SEC rules, we are providing the following information about the relationship of the annualized total compensation of our current Chief Executive Officer, Sean Feeney, to that of our median employee. The pay ratio and annual total compensation amount disclosed in this section are reasonable estimates that have been calculated using methodologies and assumptions permitted by SEC rules.

We identified our median employee in fiscal 2020 by calculating the fiscal 2020 cash compensation for all of our employees, excluding our Chief Executive Officer, who were employed by us on June 30, 2020. Cash compensation included all cash salaries, wages, and bonuses paid to each employee during the fiscal year.

After identifying the median employee as described above, we calculated annual total compensation for this employee using the same methodology we use in the Summary Compensation Table. The fiscal 2020 compensation for our median employee was $88,447, and the annualized compensation for our Chief Executive Officer was $2,777,958.

Based on the above information, the estimated ratio of the annual total compensation of our Chief Executive Officer to the median employee is 31:1. The pay ratio reported by other companies may not be comparable to the pay ratio reported above, due to variances in business mix, proportion of seasonal and part-time employees, distribution of employees across geographies, and the wide range of methodologies that the SEC rules allow companies to adopt in calculating this pay ratio.

In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2020 for filing with the Securities and Exchange Commission.

The Audit Committee

Shannon Warren (Chair)

Ellen Richey

Anne Smalling

The foregoing report and other information provided above regarding the Audit Committee should not be deemed incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933, as amended, or the Exchange Act (the “Acts”), except to the extent that the Company specifically incorporates this information by reference, and shall not otherwise be deemed filed under such Acts.

During the fiscal year ended June 30, 2020 and June 30, 2019, fees in connection with services rendered by BDO USA, LLP were as set forth below:

Audit fees consisted of fees for the audit of our annual financial statements, review of quarterly financial statements and the audit of internal control over financial reporting, as well as services normally provided in connection with statutory and regulatory filings or engagements, consents and assistance with and reviews of Company documents filed with the Securities and Exchange Commission.

The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent registered public accounting firm on a case-by-case basis. The Audit Committee has pre-approved audit fees for fiscal year 2021 in the range of $ $1,410,000 to $1,575,000.

The following table sets forth, as of March 15, 2021, the beneficial ownership of the Series A Preferred Stock by the Company’s directors, by the named executive officers included in the Fiscal Year 2020 Summary Compensation Table set forth above, by the Company’s directors, named executive officers and other executive officers as a group, and by the beneficial owner of more than 5% of the Series A Preferred Stock. There were no shares of Series A Preferred Stock beneficially owned as of March 15, 2021 by the Company’s directors, by the named executive officers included in the Fiscal Year 2020 Summary Compensation Table set forth above, or by the directors, named executive officers and other executive officers as a group. Except as indicated below, the Company believes that the beneficial owners of the Series A Preferred Stock listed below have sole investment and voting power with respect to such shares, subject to community property laws where applicable.

the Company’s Common Stock. The Company received aggregate gross proceeds from the Private Placement of approximately $55 million, before deducting fees to the placement agents and other estimated offering expenses payable by the Company, based on the offering price of $9.60 per share (the “Purchase Price”). The financing syndicate included affiliates of Hudson Executive, which purchased 975,000 of the Shares sold in the Private Placement for the same Purchase Price and on the same terms as the other Purchasers. The Purchase Price and other terms of the Private Placement were approved by a special pricing committee of the Company’s board of directors comprised solely of independent and disinterested directors. The Private Placement closed on March 4, 2021. The Company intends to use the proceeds of the Private Placement for general corporate purposes. J.P. Morgan Securities LLC acted as lead placement agent and Craig-Hallum Capital Group LLC and Northland Capital Markets acted as joint placement agents in connection with the Private Placement (together, the “Placement Agents”). The Company agreed to pay the Placement Agents an aggregate cash fee of approximately $2.28 million, representing 5% of the gross proceeds of the Private Placement, excluding the gross proceeds received by the Company from Hudson Executive in the Private Placement.

Two employees of Hudson Executive, a greater than 10% shareholder of the Company, entered into consulting agreements with the Company in August and September of 2020, respectively, under which the consultants are to provide financial and strategic analysis and advisory services to the CEO through July 31, 2021. As consideration for the services, in March 2021 the consultants were granted 35,000 and 45,000 restricted stock units, respectively. Hudson Executive is not a party to these agreements and does not receive any compensation for the services provided by the consultants to the CEO.

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s officers and directors, and persons who own more than ten percent of a registered class of the Company’s equity securities, to file with the Securities and Exchange Commission reports of ownership of Company securities and changes in reported ownership. Based on a review of reports filed with the SEC, or written representations from reporting persons that all reportable transaction were reported, the Company believes that during the fiscal year ended June 30, 2020, the Company’s officers, directors and greater than ten percent owners timely filed all reports they were required to file under Section 16(a), except that one report, covering a total of one transaction, was filed late by Mr. Feeney; one report, covering a total of one transaction, was filed late by Mr. Goold; one report, covering a total of one transaction, was filed late by Mr. Pollock; and each of Messrs. Haines, Sunil and Wasserfuhr filed a late report, each a Form 3 not relating to a transaction.

As permitted by the Exchange Act, only one copy of the Notice is being delivered to stockholders residing at the same address, unless such stockholders have notified us of their desire to receive multiple copies of the proxy statement or annual report. We will promptly deliver, upon oral or written request, a separate copy of the annual report or proxy statement, as applicable, to any stockholder residing at an address to which only one copy was mailed. Requests for additional copies should be directed to the Corporate Secretary at 100 Deerfield Lane, Suite 300, Malvern, Pennsylvania 19355.

Shareholders residing at the same address and currently receiving only one copy of the Notice may contact the Corporate Secretary at 100 Deerfield Lane, Suite 300, Malvern, Pennsylvania 19355, to request multiple copies in the future. Stockholders residing at the same address and currently receiving multiple copies may contact the Corporate Secretary to request that only a single copy of the Notice be mailed in the future.

Pursuant to Rule 14a-8 of the Exchange Act, proposals of stockholders for possible consideration at the 2022 Annual Meeting of Stockholders must be received by the Corporate Secretary of the Company before the close of business on November 29, 2021 to be included in the proxy statement for that meeting, if appropriate for consideration under applicable securities laws.

In addition, our bylaws provide that, in order to be properly brought before the 2022 Annual Meeting, a stockholder’s notice of a matter that the stockholder wishes to present (other than a matter brought pursuant to Rule 14a-8

promulgated under the Exchange Act), as well as any director nominations, must be received by the Secretary of the Company not less than 60 nor more than 90 days before the first anniversary of the date of the 2021 Annual Meeting. As a result, any notice given by a shareholder pursuant to these provisions of our Bylaws (and not pursuant to Rule 14a-8 promulgated under the Exchange Act) must be received no earlier than February 12, 2022, and no later than the close of business on March 14, 2022, unless our annual meeting date occurs more than 30 days before or 60 days after May 13, 2022. In that case, we must receive proposals not earlier than the close of business on the 90th day prior to the date of the 2022 Annual Meeting and not later than the close of business on the later of: (i) the 60th day prior to the date of the 2022 Annual Meeting; or (ii) the 10th day following the day on which we first make a public announcement of the date of the 2022 Annual Meeting.

Notices discussed above and requests for copies of the relevant By-Law provisions regarding the requirements for making shareholder proposals and director nominations may be sent to our Corporate Secretary at our principal executive office as follows: USA Technologies, Inc., 100 Deerfield Lane, Suite 300, Malvern, Pennsylvania 19355, Attn: Corporate Secretary.

The Board does not know of any other matters which may come before the meeting. If any other matters are properly presented to the meeting, the proxy holders intend to vote, or otherwise to act, in accordance with their judgment on such matters.