AMSWA American Software Inc

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

SCHEDULE 14A

Proxy Statement Pursuant to

Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant ☑

Filed by a Party other than the Registrant  ☐

Check the appropriate box:

Payment of Filing Fee (Check all boxes that apply):

AMERICAN SOFTWARE, INC.

470 East Paces Ferry Road, N.E.

Atlanta, Georgia 30305

PRELIMINARY PROXY STATEMENT- SUBJECT TO COMPLETION

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

TO THE SHAREHOLDERS:

NOTICE IS HEREBY GIVEN that the 2024 annual meeting of shareholders (the “Annual Meeting”) of AMERICAN SOFTWARE, INC. (the “Company”) will be held at the principal offices of the Company, 470 East Paces Ferry Road, N.E., Atlanta, Georgia, on [Weekday], [Month][Date], 2024 at [Time]. Eastern Daylight Time, for the following purposes:

Only shareholders of record of the Company at the close of business on [•], 2024 will be entitled to vote at the Annual Meeting.

Shareholders are requested to vote, date, sign and mail their proxies in the form enclosed even if they plan to attend the Annual Meeting. If shareholders are present at the Annual Meeting, their proxies may be withdrawn, and they may vote personally on all matters brought before the Annual Meeting, as described more fully in the enclosed Proxy Statement.

BY ORDER OF THE BOARD OF DIRECTORS

 

[•], 2024

IMPORTANT

We encourage you to attend the Annual Meeting. In order that there may be a proper representation at the Annual Meeting, each shareholder is requested to return his or her proxy in the enclosed envelope, which requires no postage if mailed in the United States. Attention by shareholders to this request will reduce the Company’s expense in soliciting proxies.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL

MEETING OF SHAREHOLDERS TO BE HELD ON [•], 2024:

This Proxy Statement, the proxy card and the Company’s Annual Report on Form 10-K for the fiscal year

ended April 30, 2024 are available at: [•]

TABLE OF CONTENTS

PROXY STATEMENT

FOR ANNUAL MEETING OF SHAREHOLDERS

OF AMERICAN SOFTWARE, INC.

TO BE HELD AT

AMERICAN SOFTWARE, INC.

470 EAST PACES FERRY ROAD, N.E.

ATLANTA, GEORGIA

ON [•], 2024

GENERAL INFORMATION

This Proxy Statement is furnished to Class A shareholders of American Software, Inc. (the “Company”) by the Board of Directors of the Company (the “Board”), in connection with the solicitation made by the Company of proxies for use at the annual meeting of shareholders (the “Annual Meeting”) to be held at the Company’s principal offices on [Weekday], [Month][Day], 2024 at [Time] Eastern Daylight Time, and at any adjournment or adjournments thereof, for the purposes set forth in the accompanying Notice of Annual Meeting of Shareholders. This Proxy Statement and accompanying proxy card and Notice of Annual Meeting are first being mailed to shareholders on or about [•], 2024.

The mailing address of the Company’s executive office is 470 East Paces Ferry Road, N.E., Atlanta, Georgia 30305. The Company’s website is www.amsoftware.com. Information from the Company’s website is not incorporated by reference into any portion of this Proxy Statement.

Proposals

If the enclosed form of proxy is properly executed and returned, the shares represented thereby will be voted in accordance with its terms. If no choices are specified, subject to the broker non-vote rules discussed under “Broker Non-Votes” below, the proxy will be voted:

In addition, a properly executed and returned proxy card gives the authority, subject to the broker non-vote rules, to vote in accordance with the proxy holder’s best judgment on such other business as may properly come before the Annual Meeting or any adjournment or adjournments thereof. Any proxy given pursuant to this solicitation

may be revoked, either in writing furnished to the Secretary of the Company prior to the Annual Meeting or personally by attendance at the Annual Meeting, by the person giving the proxy insofar as the proxy has not been exercised at the Annual Meeting and the shareholder attending the Annual Meeting informs the Secretary of the Company of his or her intent to revoke the proxy.

Record Date

The Board has fixed the close of business on [•], 2024 as the record date for determining the holders of common stock entitled to notice of and to vote at the Annual Meeting. On [•], 2024, the Company had outstanding and entitled to vote a total of [•] Class A Common Stock (“Class A Shares”) and [•] Class B Common Stock (“Class B Shares”).

Reclassification and Elimination of Dual Class Capital Structure

Our Company’s dual class capital structure, consisting of Class A Shares and Class B Shares, has been in place since the Company’s inception. At their option, Class B shareholders may convert their Class B Shares into Class A Shares at any time. Neither the Company nor the Company’s Class A shareholders have the right or power to unilaterally “recapitalize” the Company’s equity capital structure to eliminate the dual class structure (whether by conversion, buyback, redemption or amendment of the Company’s articles of incorporation), but rather can only do so with the approval of the Class B shareholders. The Company has consistently provided disclosure regarding the control rights of the Class B shareholders to new and existing public shareholders to inform their investment decisions regarding the Company’s Class A Shares. Historically, unlike many companies with dual class structures, the Company’s Class A directors were elected by the holders of the Company’s Class A stock without any influence from the holders of the Class B stock and the Class B directors were elected by the Class B shareholders without any influence from the holders of the Class A stock. Once elected, there was no distinction between Class A or Class B directors, and they had the same duties and responsibilities to protect the interests of all shareholders.

As a part of the Board’s commitment to enhancing its corporate governance practices, the Board is proposing to its shareholders that they approve the Reclassification which would eliminate the Company’s dual class capital structure. Pursuant to the Reclassification Agreement (as described below), subject to the terms and conditions set forth therein, the Company will reclassify its equity capital structure to eliminate the Class B Shares effected through the filing of an amendment to the Company’s Amended and Restated Articles of Incorporation, which provides, among other things, for the automatic reclassification and exchange of each issued and outstanding share of Class B Shares into 1.2 Class A Shares (the “Reclassification Amendment”). See “Proposal 5 – Summary of Reclassification Agreement” on page 43 for a description of the Reclassification Agreement. A copy of the Reclassification Agreement is attached as Appendix A to this Proxy Statement and is incorporated by reference. We refer to Proposal 5 as the “Reclassification Proposal.” See also “Proposal 6 – Approval of the Amendment and Restatement of the Company’s Amended and Restated Articles of Incorporation to give effect to the Reclassification” on page 57 for a description of the Reclassification Amendment. A copy of the proposed Second Amended and Restated Articles of Incorporation is attached as Appendix B to this Proxy Statement and is incorporated by reference. We refer to Proposal 6 as the “Reclassification Amendment Proposal.”

In light of the proposed Reclassification and Reclassification Amendment (each as described below in Proposals 5 and 6, respectively), Mr. James C. Edenfield (referred to herein as “Mr. Edenfield”, or, the “Class B Shareholder”), the owner of 100% of the issued and outstanding Class B Shares, has agreed to waive his right to nominate any individual for election to serve as a Class B director. As such, there will be no Class B director nominees elected at the Annual Meeting. Instead, each director currently serving as a Class B director has been nominated for election as a Class A director at the Annual Meeting. If the Reclassification and the Reclassification Amendment proposals are each approved, effective upon the closing of the Reclassification, the Company’s sole remaining class of common stock outstanding will no longer be referred to as “Class A Common Stock”. Accordingly, if the proposed Reclassification and Reclassification Amendment are approved, directors on the Board will no longer be referred to as Class A directors and will instead be referred to as the “director nominees.”

Class A and Class B Shareholder Voting

Other than in the election of directors, each outstanding Class A share is entitled to one-tenth of a vote per share and each outstanding Class B share is entitled to one vote per share on all matters to be brought before the Annual Meeting.

A one-third quorum of [•] Class A Shares and [•] Class B Shares is required to be present or represented by proxy at the Annual Meeting in order to conduct all of the business expected to come before the Annual Meeting. Votes that are withheld, broker non-votes and votes of abstention cast by any shareholder on a particular action will be counted towards the quorum requirement but will not be counted as a vote for or against the action.

The Class A directors will be elected by a majority of the votes cast by the holders of shares entitled to vote. The approval of the Reclassification Proposal and the Reclassification Amendment Proposal (each as described below) will require the affirmative vote of the holders of (a) a majority of the issued and outstanding shares of Class A Shares and Class B Shares held by all holders of Class A Shares and Class B Shares, voting as a single voting class, and (b) a majority of the issued and outstanding shares of Class A Shares held by the Unaffiliated Common Shareholders (as defined below), voting as a separate voting class. Any other matter submitted to the Annual Meeting must be approved or ratified by a majority vote of the outstanding shares (adjusted as described above) present or represented by proxies at the Annual Meeting.

Additionally, in light of the Reclassification Proposal and as described below in “Proposal 5- Approval of the Reclassification,” Mr. Edenfield has agreed to waive his right to nominate any individual for election to serve as a Class B Director on the Board; has irrevocably appointed each of H. Allan Dow, Vincent Klinges and Mark Grant as Mr. Edenfield’s proxy and attorney-in-fact with authority to vote Mr. Edenfield’s shares at the Annual Meeting; and has agreed to not grant any other proxies or enter into any voting trusts, transfer any shares of Class B Shares (except in limited circumstances) and enter into any hedging, derivative or swap transactions.

Broker Non-Votes

Broker non-votes occur when a broker or nominee holding shares for a beneficial owner does not vote on a non-routine proposal because the broker or nominee has not received voting instructions from the beneficial owner and does not have discretionary voting power with respect to such proposal. Rule 452 of the New York Stock Exchange, which has been adopted by the NASDAQ Stock Market, provides that a broker or other nominee holding shares for a beneficial owner may generally vote on routine matters, but not non-routine matters, without receiving voting instructions. The uncontested election of directors (Proposal 1), the advisory vote on the compensation of our named executive officers (Proposal 3), the vote to approve the 2024 Equity Compensation Plan (Proposal 4), the vote to approve the Reclassification (Proposal 5), the vote to approve the amendment and restatement of the Company’s Amended and Restated Articles of Incorporation that would give effect to the Reclassification (Proposal 6), the vote to approve the amendment and restatement of the Company’s Amended and Restated Articles of Incorporation that would give effect to the indemnification of directors and officers amendment (Proposal 7) and the vote to approve the amendment and restatement of the Company’s Amended and Restated Articles of Incorporation that would give effect to the blank check preferred stock amendment (Proposal 8) are non-routine matters. Please provide instructions to your broker or nominee on how to vote your shares. If you do not provide such voting instructions, your shares will not be voted for Proposals 1, 3, 4, 5, 6, 7 and 8. The ratification of the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the Company’s fiscal year ending on April 30, 2024 (“fiscal 2024”) (Proposal 2) is considered a routine matter. Because at least one routine item is to be voted on at the Annual Meeting, shares held in the name of brokers or other nominees and voted on Proposal 2 will be counted for purposes of the quorum requirement, as noted above.

PROPOSAL 1: ELECTION OF DIRECTORS

Overview

The directors of the Company are elected annually to hold office until the election and qualification of their successors at the next annual meeting of shareholders. The Class A director nominees for election are named on the enclosed proxy card and include H. Allan Dow, W. Dennis Hogue, Thomas L. Newberry, V, Celena Matlock, Matthew G. McKenna, James B. Miller, Jr., Lizanne Thomas and Nicole Wu. The persons named on the enclosed proxy card intend to vote Class A Shares for the election of these Class A director nominees. If any of these individuals should be unavailable to serve as a director, the proxy will be voted in accordance with the best judgment of the person or persons acting under it. The Boards of Directors has no reason to believe that any Class A director nominees will be unavailable for election as a director. If any of the nominees is unable to serve, the remaining Board members may elect a substitute to fill the resulting vacancy.

Director Background and Qualifications

The Board seeks directors with strong reputations and experience in areas relevant to the strategy and operations of the Company’s business, particularly industries and segments that the Company serves. Each of the nominees for election as a director at the Annual Meeting has substantial and meaningful experience in core management skills, such as strategic, financial and operational planning, financial reporting, corporate governance, risk management, and leadership development. The information set forth below includes a summary of each director nominee’s individual qualifications, experience, attributes and skills that we believe add to the strength of our Board.

Candidates for membership on the Board are recommended by current members of the Board or management. When evaluating candidates for membership on the Board, the Board considers a number of factors, including:

The directors, their ages, their principal occupations for at least the past five years, other public company directorships held by them and the year each was first elected as a director of the Company are set forth below.

Director Skills

 

Required Vote

The Class A directors will be elected by a majority of the votes cast by the holders of shares entitled to vote. Votes that are withheld, broker non-votes and votes of abstention will not be counted as a vote for or against Proposal 1.

Class A Director Nominees

CORPORATE GOVERNANCE

Board Meetings

The Board held nine meetings during fiscal 2024. No director of the Company attended fewer than 75% of the total meetings of the Board of Directors and committee meetings on which such Board member served and was eligible to attend during this period.

Director Attendance at Annual Meetings

Although the Company does not have a policy with regard to Board members’ attendance at the Company’s annual meetings of shareholders, all of the directors are encouraged to attend such meetings. All of the Company’s then serving directors attended the 2023 Annual Meeting.

Director Independence

Because the holders of Class B Shares have the right to elect six of the eight directors and because Mr. Edenfield owns 100% of the issued and outstanding Class B Shares, the Company currently qualifies as a “controlled company” as defined in Rule 5615(c)(1) of the NASDAQ Marketplace Rules (the “NASDAQ Rules”). Please see “Security Ownership of Management and Certain Beneficial Owners” below. Notwithstanding the foregoing, in an effort to continuously improve its corporate governance practices, all of the members of the Board’s Audit Committee, Compensation Committee and Nomination and Corporate Governance Committee are “Independent” under the NASDAQ rules. See the table under the heading “Director Nominees” on page iii of the Proxy Statement Summary to see the determinations of independence for each director nominee.

If, however, the Reclassification Proposal and Reclassification Amendment Proposal are both approved, as described below in Proposal 5, the Class B Shares will be eliminated. Thus, the Company will no longer qualify as a “controlled company” as defined in the NASDAQ rules and cannot rely on the exemption afforded to controlled companies under NASDAQ rules with respect to Board and committee independence.

Director Nominations

As a part of the Company’s commitment to regularly enhance its corporate governance practices, the Company formed the Nomination and Corporate Governance Committee of the Board for the purpose of identifying qualified individuals to serve as members of the Board and recommending those individuals for nomination to the Board and submission for shareholder approval. In light of the Nomination and Corporate Governance Committee’s efforts in this regard, the Board has determined that it would not be productive to have a fixed policy with respect to consideration of candidates recommended by security holders. However, if a shareholder communication includes a recommendation of a candidate for director, the Nomination and Corporate Governance Committee will consider that candidate along with any other candidates for a Board position.

Board Tenure

The Board does not have a mandatory retirement age. Instead, the Board believes that directors should be evaluated on their unique perspectives, experiences and ability to contribute to the Board and that long-serving directors provide important perspective and insight based on industry experience and a deep understanding of our long-term plans and objectives. The Board is focused on maintaining a balance between longer serving directors and newer directors with complementary skills, expertise, diverse backgrounds and points of view, which allows for natural turnover and an appropriate pace of Board refreshment. As part of the Board’s ongoing efforts to seek this balance of skills, experience and tenure, the Board has elected four new directors since 2019, representing half of the members of the Board.

Board Diversity

Although the Company does not have a formal policy with regard to the consideration of diversity in identifying director nominees, the Board is making a conscious effort to increase the diversity of Board members by recruiting from a highly qualified and diverse pool of candidates. The Board strives to nominate directors with a variety of complementary skills so that, as a group, the Board will possess the appropriate talent, skills, and expertise to oversee the Company’s businesses.

Board Leadership Structure

We believe that our current Board leadership model combined with our corporate governance policies and documents, strikes an appropriate balance between informed and consistent leadership and independent oversight and perspective, allowing for efficiency and accountability, ultimately creating an environment for the effective execution of the Board’s responsibilities. The Board does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board, as the Board believes it is in the best interest of the Company to make that determination based on the position and direction of the Company and the membership of the Board. Currently, H. Allan Dow, our Chief Executive Officer and President, is serving as the Company’s principal executive officer and Mr. James B. Miller, Jr. serves as the Chairman.

Committees of the Board of Directors

Audit Committee

The Board has an Audit Committee, which presently consists of Messrs. Miller (Chairman), Hogue, McKenna and Newberry, Mmes. Thomas, Matlock and Wu. The Audit Committee held ten (10) meetings during fiscal 2024, in addition to its consultations with our independent registered public accounting firm and management in connection with review of interim financial statements. The NASDAQ Rules require audit committees to be composed of not less than three members who are “independent,” as that term is defined in the NASDAQ Rules. The Board has determined that all of the Audit Committee members meet the NASDAQ definition of “independent.”

The Audit Committee has a written charter, which can be found on our website at www.amsoftware.com. The Audit Committee’s charter outlines the composition requirements of the Audit Committee, as described above, as well as its duties and responsibilities. The primary responsibility of the Audit Committee is to oversee the Company’s financial reporting process on behalf of the Board and report the results of the Audit Committee’s activities to the Board. The functions of the Audit Committee include making an annual recommendation of the independent registered public accounting firm to the Company, reviewing the scope and results of the independent registered public accounting firm’s audit, monitoring the adequacy of the Company’s accounting, financial and operating controls, pre-approving audit services and permitted non-audit services and related fees, and reviewing with

management and the independent registered public accounting firm the financial statements to be included in the Company’s annual and quarterly reports and other financial reports. The Board has determined that James B. Miller, Jr., Chairman of the Audit Committee, is an “audit committee financial expert” as defined in the rules of the United States Securities and Exchange Commission (the “SEC”).

Compensation Committee

The Board has a Compensation Committee, consisting of Messrs. Miller (Chairman), Hogue, McKenna and Newberry, Mmes. Thomas, Matlock and Wu. During fiscal 2024, the Compensation Committee met on one occasion. The Board has determined that all of the Compensation Committee members meet the NASDAQ definition of “independent.” The Compensation Committee has a written charter, which can be found on our website at www.amsoftware.com.

The Compensation Committee’s charter outlines the composition requirements of the Compensation Committee, as well as its duties and responsibilities. The Compensation Committee has authority to establish the compensation of our Chief Executive Officer and President, and prior to his retirement, our former Executive Chairman. The Compensation Committee also consults with our Chief Executive Officer and President about the compensation of the other named executive officers.

In addition, the Compensation Committee, which acted through the Special Stock Option Committee until May 29, 2024, has the authority to grant stock options to our named executive officers, including prior to his retirement, our former Executive Chairman, under the Company’s Amended and Restated 2020 Equity Compensation Plan (the “2020 Plan”) and, if approved the Company’s 2024 Equity Compensation Plan (the “2024 Plan”). See “Executive Compensation - Compensation Discussion and Analysis” below for a further discussion of the Compensation Committee and the functions it performs.

Until May 29, 2024, two different committees of the Board, the Special Stock Option Committee and the Stock Option Committee, administered the 2020 Plan (see “Executive Compensation - Stock Options”), depending on whether the option grant was made to an executive officer, a director or another person. Prior to May 29, 2024, the Special Stock Option Committee, which consisted of Messrs. Miller, Hogue, McKenna and Newberry and Mmes. Thomas, Matlock and Wu, each a member of the Compensation Committee, administered stock option grants to executive officers and directors. Prior to May 29, 2024, the Stock Option Committee, which consisted of H. Allan Dow and, prior to his retirement, Mr. Edenfield, administered stock option grants to other employees. The functions of these committees were to grant stock options and establish the terms of those stock options, as well as to construe and interpret the 2020 Plan and previous plans and to adopt related rules and procedures. During fiscal 2024, the Special Stock Option Committee acted by written consent on one (1) occasion and the Stock Option Committee acted by written consent on four (4) occasions in connection with the grant of stock options under the Company’s 2020 Plan.

On May 29, 2024, the Board acted to dissolve the Special Stock Option Committee and the Stock Option Committee and to delegate the duties of each of the two committees to the Compensation Committee, effective immediately. Accordingly, the Compensation Committee will henceforth assume the duties and functions previously delegated to the Special Stock Option Committee and the Stock Option Committee described above.

Nomination and Corporate Governance Committee

Notwithstanding the fact that the Company qualifies as a “controlled company” as defined in Rule 5615(c)(1) of the NASDAQ Rules, the Board of Directors formed the Nomination and Corporate Governance Committee in fiscal 2023 as a part of its effort to regularly enhance its corporate governance practices. The Nomination and Corporate Governance Committee consists of Ms. Thomas (Chairwoman) and Messrs. McKenna and Hogue, and held one meeting during fiscal 2024. The NASDAQ Rules require nominating committees to be composed of not less than three members who are “independent,” as that term is defined in the NASDAQ Rules. The Board has determined that all of the Nomination and Corporate Governance Committee members meet the NASDAQ definition of “independent.”

The Nomination and Corporate Governance Committee will be instrumental in assisting the Board by (i) identifying qualified individuals to serve as members of the Board and recommending those individuals for shareholder approval; (ii) overseeing and periodically reviewing the Company’s corporate governance practices and procedures; and (iii) overseeing the evaluation of the Board and standing committees of the Board. In connection with its recruiting of director candidates, the Nomination and Corporate Governance Committee will, consistent with its

fiduciary duties, continue to (a) consider factors such as the individual’s experience, integrity, competence, skills, and dedication in the context of the needs of the Board, and (b) seek to recruit from a diverse pool, taking into account diversity factors such as gender, race, ethnicity, age, experience, and occupation, and NASDAQ’s listing rules regarding Board diversity.

The Nomination and Corporate Governance Committee has the authority to select and retain a search firm and other third-party advisors to assist the committee in identifying director candidates and otherwise support the committee’s responsibilities. No fees were paid to any third party in connection with the identification of the director nominees identified in this Proxy Statement.

The Nomination and Corporate Governance Committee has a written charter, which can be found on our website at www.amsoftware.com. The Nomination and Corporate Governance Committee’s charter outlines the committee’s composition requirements, as well as its duties and responsibilities.

Risk Oversight

We believe that understanding and managing risk is the responsibility of each employee of the Company. However, management is ultimately accountable to our Board of Directors and shareholders for the day-to-day management of risks we face. Our Board, as a whole and through its committees, oversees planning and responding to risks arising from changing business conditions or the initiation of new activities, strategies or products. Our Board also is responsible for overseeing compliance with laws and regulations, responding to recommendations from auditors and supervisory authorities, and overseeing management’s conformance with internal policies and controls addressing the operations and risks of significant activities.

Code of Business Conduct and Ethics

The Company has adopted a Code of Business Conduct and Ethics (the “Code of Conduct”), which applies to all directors, officers and employees of the Company. As part of its review of the corporate governance policies of the Company, the Board adopted certain amendments to the Code of Conduct, effective May 20, 2020, to (i) better address applicable law and regulatory guidance, (ii) provide additional clarity on acceptable and unacceptable behaviors and actions, and (iii) make other technical, administrative, and non-substantive amendments. Furthermore, the Board further amended the Code of Conduct, effective November 23, 2023, to provide additional clarity on anti-bribery compliance. The Code of Conduct is available on the Company’s website at www.amsoftware.com/investor-relations/.

Hedging Policy

Our Code of Conduct prohibits our directors and employees from engaging in certain hedging transactions.

Insider Trading Policy

The Company maintains a policy (which was recently updated in July 2023) that mandates compliance with insider trading laws and institutes safeguards to mitigate the risk of insider trading.

Communications Between Shareholders and Directors

Shareholders may contact the Board or any individual director by writing to them c/o Mr. Vincent C. Klinges, Chief Financial Officer, American Software, Inc., 470 East Paces Ferry Road, N.E., Atlanta, Georgia 30305. Inquiries sent by mail may be sorted and summarized by Mr. Klinges or his designee before they are forwarded to the addressee.

PROPOSAL 2: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

The Board, upon the recommendation of the Audit Committee, has appointed KPMG LLP (“KPMG”) to serve as its independent registered public accounting firm for the fiscal year ending on April 30, 2025. KPMG acted in such capacity during the fiscal year ended April 30, 2024. This appointment is being presented to the shareholders for ratification. Although the Company is not required to obtain shareholder ratification, the Company has elected to do so in order to provide the shareholders with an opportunity to participate in this decision. In the event that the shareholders do not ratify the appointment of KPMG as the independent registered public accounting firm of the Company, the Board will consider the retention of another independent registered public accounting firm.

The Company expects that representatives of KPMG will attend the 2024 Annual Meeting. These representatives will be available to respond to appropriate questions raised orally and will be given the opportunity to make a statement if they so desire.

During the fiscal year ended April 30, 2024, the Company engaged KPMG to provide certain audit services, including the integrated audit of the annual consolidated financial statements, quarterly reviews of the consolidated financial statements included in our Quarterly Reports on Form 10-Q, services performed in connection with filing this Proxy Statement and the Annual Report on Form 10-K by the Company with the SEC, attendance at meetings with the Audit Committee and consultation on matters relating to accounting, tax and financial reporting. KPMG has acted as independent registered public accounting firm for the Company since 1982. Neither KPMG nor any of its associates has any relationship to the Company or any of its subsidiaries except in its capacity as independent registered public accounting firm.

The aggregate fees billed to the Company by KPMG for services rendered during fiscal 2023 and fiscal 2024 are summarized below:

Audit Fees. Fees for audit services totaled approximately $884,000 in fiscal 2023 and approximately $1,127,000 in fiscal 2024, including fees associated with the annual audit and the reviews of consolidated financial statements in Quarterly Reports on Form 10-Q, including Sarbanes-Oxley 404 audit fees.

Audit-Related Fees. There were no fees for audit related services incurred for fiscal 2023 or fiscal 2024.

Tax Fees. There were no fees for tax services, including tax compliance, tax advice and tax planning, billed to the Company by KPMG in fiscal 2023 or in fiscal 2024.

All Other Fees. The Company’s independent registered public accounting firm did not receive fees for other services not described above in fiscal 2023 or in fiscal 2024.

In accordance with the NASDAQ Rules and rules and regulations promulgated by the SEC, the approval of the Audit Committee is required for all independent audit engagement fees, terms and conditions and all permitted non-audit engagements (including the fees, terms and conditions thereof) that the independent registered public accounting firm performs for the Company.

Board Recommendation

The Board believes it is in the best interest of the Company and its shareholders to ratify the appointment of KPMG as its independent registered public accounting firm for the fiscal year ending on April 30, 2025. Approval of this proposal requires the affirmative vote of a majority of the shares present or represented by proxy and entitled to vote on this proposal.

AUDIT COMMITTEE REPORT

The following is the Report of the Audit Committee of the Board of Directors of American Software, Inc. for the fiscal year ended April 30, 2024.

The Board of Directors has adopted a written charter for the Audit Committee. As set forth in the charter, the Audit Committee’s job is one of oversight. It is not the duty of the Audit Committee to prepare the financial statements of the Company, to plan or conduct audits, or to determine that the financial statements of the Company are complete and accurate and are in accordance with U.S. generally accepted accounting principles. The Company’s management is responsible for preparing the Company’s consolidated financial statements and for maintaining internal controls. The independent registered public accounting firm of the Company is responsible for auditing the consolidated financial statements and for expressing an opinion as to whether those audited financial statements fairly present, in all material respects, the financial position, results of operations, and cash flows to the Company in conformity with U.S. generally accepted accounting principles.

In fulfilling its responsibilities with respect to the fiscal 2024 audit, the Audit Committee: (1) reviewed and discussed the audited consolidated financial statements for the fiscal year ended April 30, 2024 with Company management and KPMG, the Company’s independent registered public accounting firm; (2) discussed with KPMG the matters required to be discussed pursuant to Statement on Auditing Standards No. 1301, “Communications Audit Committees,” as adopted by the Public Company Accounting Oversight Board (“PCAOB”); and (3) received the disclosure and the presentation from KPMG required by the applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence and discussed with KPMG its independence from the Company.

Based on the Audit Committee’s review of the audited consolidated financial statements and discussions with management and KPMG, 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 April 30, 2024 for filing with the SEC.

The NASDAQ Rules require audit committees to be composed of not less than three members who are “independent directors,” as that term is defined in the listing requirements. The Audit Committee believes that its members meet the definition of “independent directors” set forth in those rules.

By the Audit Committee:

 

James B. Miller, Jr., Chairman

W. Dennis Hogue

Celena Matlock

Matthew G. McKenna

Thomas L. Newberry, V

Lizanne Thomas

Nicole Wu

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

We believe that attracting, retaining and motivating effective executive officers is critical to the overall success of our business. To achieve these goals we have adopted executive compensation programs designed to reward performance and emphasize the creation of shareholder value. For fiscal 2024, our Compensation Committee and, prior to his retirement, our Executive Chairman, were responsible for establishing executive compensation policies and overseeing executive compensation practices. In the following Compensation Discussion and Analysis, we describe the material elements of compensation for our executive officers identified in the Summary Compensation Table (the “named executive officers”). Our named executive officers for fiscal 2024 are: H. Allan Dow, our Chief Executive Officer and President; Vincent C. Klinges, our Chief Financial Officer and Treasurer, and James C. Edenfield, our former Executive Chairman and Treasurer. Please see “Director Background and Qualifications” above for additional information regarding Mr. H. Allan Dow. Additional information about Mr. Edenfield and Mr. Klinges appears below.

Please see the Summary Compensation Table below for detailed components of our named executive officers’ fiscal 2024 compensation.

Non-Director Executive Officers

Oversight of Fiscal 2024 Compensation Program

The Compensation Committee of the Board of Directors is responsible for establishing and reviewing our overall compensation philosophy. The Compensation Committee reviews and establishes all elements of compensation of our Chief Executive Officer and President and, prior to his retirement, our Executive Chairman.

Prior to our Executive Chairman’s retirement in February 2024, the Compensation Committee consulted with our Executive Chairman about salaries and cash compensation of our other named executive officer (other than stock option compensation), but the Executive Chairman had the authority to establish the compensation for such other executive officer, except for stock option compensation. The Compensation Committee acted as the Special Stock Option Committee (which is further described below) with respect to stock option grants to all named executive officers, including the Executive Chairman. With respect to the major elements of executive compensation plans, the Executive Chairman consulted with the Compensation Committee and made recommendations regarding levels of option grants to specific individuals, as input to the Compensation Committee’s final decision regarding stock option grants.

However, in light of our Executive Chairman’s retirement, our Compensation Committee now reviews and establishes all elements of compensation for our named executive officers.

Executive Compensation Philosophy

We believe that a compensation program which promotes our ability to attract, retain and motivate outstanding executives will help us meet our long-range objectives, thereby serving the interests of the Company’s shareholders. Our executive officer compensation program is designed to achieve the following objectives:

Consideration of Peer Companies

In making compensation decisions, the Compensation Committee reviews publicly available information on practices and programs and compensation levels of members of a peer group selected by the Compensation Committee, consisting of technology companies similar to us. The Compensation Committee reviews our compensation peer group at least annually and makes adjustments to its composition if warranted, taking into account changes in both our business and the businesses of the companies in the peer group.

During fiscal 2024, the Compensation Committee used the following compensation peer group to assist with the determination of compensation for our executive officers: Agilysys Inc., Aspen Technology, Inc., Asure Software, Inc., PROS Holdings Inc., The Descartes Systems Group, Inc., eGain Corporation, E2open Parent Holdings, Inc., Kinaxis, Inc., Manhattan Associates, Inc., Model N, Inc., and SPS Commerce, Inc.

While we believe this compensation data provides useful insight into the competitiveness of our compensation packages, the data serves only a reference point and we do not currently target any particular benchmark.

Elements of Compensation

General. We have selected and structured the components of our executive officer compensation in order to achieve our objectives of attracting, retaining and motivating such officers. We consider the components of our compensation program - salary, bonus plan, stock options, and personal benefits such as life insurance and retirement plans - together to achieve a balanced compensation package that addresses the objectives described above, and separately in order to evaluate their reasonableness. Taken as a whole, we believe that these elements of our compensation structure reward past performance and provide appropriate motivation to achieve both long- and short-term objectives that benefit shareholders.

In our approach to executive compensation we generally have emphasized bonus plans and stock options, as we believe those components have the greatest potential for directly aligning the future interests of executive officers with those of shareholders. We also believe that our practice of emphasizing stock option grants, which we

have followed for many years, has helped motivate our executives to develop strategies that further our long-term interests. We intend for our executive bonus plans to motivate executive officers in the short term, based upon achieving operating results that enhance shareholder value without taking undue business risks. In reviewing salaries of executive officers, we consider the executive’s previous salary level in light of prior year performance, rate of inflation and trends in executive compensation among our competitors. In selecting insurance and retirement plans, we have taken into account the needs of our entire workforce, on the principle that these plans are most effective and most valued if they are made available across all levels of compensation within the Company.

Base Salaries. We establish the salaries of our named executive officers at levels that we believe are, when viewed in conjunction with their potential bonus income and stock option grants, competitive and reasonable in light of their experience, prior performance and level of responsibility. For fiscal 2024, the Committee reviewed and established the base salary of our Executive Chairman and our Chief Executive Officer and President. With respect to our other named executive officer, the Committee consulted with the Executive Chairman, but the Executive Chairman retained the authority to establish the base salary for such executive officer.

The following table summarizes the salary arrangements for the named executive officers in the fiscal years ended April 30, 2024 and 2025:

Bonuses. Each of our named executive officers has a bonus plan established during the first quarter of a fiscal year, covering that fiscal year. For fiscal 2024, the Compensation Committee established the bonus plan for James C. Edenfield, our former Executive Chairman, and H. Allan Dow, our Chief Executive Officer and President. Mr. Edenfield, after consulting with the Compensation Committee, established the bonus plans for our other named executive officers. In each case, the bonus plan is customized for the individual executive officer. We use these bonus plans, in tandem with stock option grants, as tools to (i) attract and retain qualified executives, (ii) reward executives for their role in achieving specified annual performance goals, and (iii) align our executives’ interests with those of our shareholders. To accomplish this, we establish annual bonus plans with attainable, pre-established, objective performance goals, using formulas tied to important factors that positively affect return on investment. Each year, the Compensation Committee evaluates the performance goals selected for the bonus plan and may select new or additional performance goals for the following fiscal year bonus plan.

Fiscal 2024 Bonuses. For fiscal 2024, the Compensation Committee selected the following financial performance metrics as the general set of metrics upon which to base the bonus plan: revenue, recurring revenue and adjusted EBITDA. Revenue is a GAAP measure reported in the Company’s Annual Report on Form 10-K. The Compensation Committee believes that revenue is one of the most recognizable and objective measures of corporate growth and performance. Recurring revenue consists of revenue received by the Company from its subscription and maintenance businesses. The Committee believes that recurring revenue is a commonly reported GAAP financial measure utilized in our industry that highlights current trends with respect to cloud revenue growth and the retention or conversion of maintenance revenue. Adjusted EBITDA represents our GAAP net earnings adjusted for amortization of intangibles, depreciation, interest income & other, net, and income tax expense, and has been further adjusted to exclude acquisition activity during the year. The Committee believes that adjusted EBITDA is a meaningful measure that enables the Company to evaluate its cash flow performance relative to annual performance targets.

For each financial performance metric selected for fiscal 2024, our executive officers, including our named executive officers, will receive a minimum bonus amount if the Company achieves its minimum performance goal, with the remaining bonus amount being pro-rated to 100% of a target bonus amount, which would be paid if the Company achieves its target performance goal. If the Company exceeds its target performance goal, the executive officer will receive a bonus amount equal to such executive’s target bonus amount multiplied by the percentage of the Company’s actual performance relative to the Company’s target performance goal. Revenue, recurring revenue, and adjusted EBITDA related to any acquisition made during the fiscal year are excluded for purposes of determining whether a bonus has been earned.

For fiscal 2024, the Company’s minimum and target performance goals, and actual performance, are summarized in the following table:

Mr. James C. Edenfield’s bonus for fiscal 2024 was determined as follows:

Mr. Dow’s bonus for fiscal 2024 was determined as follows:

Mr. Klinges’ bonus for fiscal 2024 was determined as follows:

Adjusted EBITDA Target Bonus Amounts and Minimum Bonus Amounts were adjusted during fiscal 2024 to account for the Company’s divestiture of The Proven Method on September 18, 2023.

Fiscal 2025 Bonuses. Similar to the fiscal 2024 bonuses, bonuses for the Company’s fiscal year ending on April 30, 2025 (“fiscal 2025”) will only be funded to the extent that the Company achieves its minimum targets, which are based on fiscal 2025 results.

Stock Option Awards. The Compensation Committee, which is responsible for grants of stock options to the named executive officers, believes that granting stock options to executive officers is an effective means to reward them for their prior performance, serve as an incentive for promotion of Company profitability and other long-term objectives, and maintain their overall compensation at competitive levels. Thus, option grants reflect both a retrospective and prospective approach to executive compensation. As compared to our executive bonus plans, stock options address longer term compensation and incentives. To establish option grant levels, the Compensation Committee has monitored developments and trends among publicly held technology companies regarding equity and non-equity based incentive compensation. The Compensation Committee continues to believe that stock options represent the most efficient and effective means for the Company to achieve the objectives described above.

The Compensation Committee, which acted through the Special Stock Option Committee until May 29, 2024, typically grants stock options to executive officers once annually, usually during the month of June or July, while the salary and bonus plans for executives are being considered and finalized and preliminary results are available for the fiscal year just ended. The option exercise prices are fixed as of the close of trading on the grant date and are based on the closing price of our Class A Shares, as quoted on the NASDAQ Stock Market. Options granted to executives during the past several years have terms of six years and vest ratably over a five-year period. We expect this practice to continue.

The Compensation Committee did not rely on a quantitative analysis when determining the levels of stock option grants to named executive officers for the 2024 or 2025 fiscal years.

The Compensation Committee developed its decisions on stock option grants based on a qualitative analysis considering the following factors:

Personal Benefits and Perquisites. We provide a variety of health, retirement and other benefits to all employees. Our executive officers are eligible to participate in the benefit plans on the same basis as all other employees. These benefit plans include participation in the Company’s 401(k) plan (with matching contributions from the Company) and medical, dental, vision, life and disability insurance. Historically, the Company permitted Mr. James C. Edenfield to use a Company-owned automobile and paid for multiple club memberships. However, in December 2021, Mr. Edenfield discontinued his use of the Company-owned automobile. The Company paid for one club membership, which the company also used for corporate events, until Mr. Edenfield’s retirement. Our Chief Executive Officer and President received a car allowance in fiscal 2024. Otherwise, our executive officers do not receive any personal benefits or perquisites that are not available on a non-discriminatory basis to all employees. The perquisites of the named executive officers in fiscal 2024 were as set forth in the “All Other Compensation” column and footnote 2 to the Summary Compensation Table below.

Other Benefits. We do not provide pension benefit plans, non-qualified contribution plans or other non-qualified deferred compensation options to any of our employees, including our named executive officers.

Consideration of Shareholder Votes on Executive Compensation

In determining executive compensation for fiscal 2024, the Compensation Committee considered the overwhelming shareholder support that the “say-on-pay” proposal received at our 2023 Annual Meeting. After carefully considering such feedback, along with the other factors described above, the Compensation Committee determined to continue to utilize the same elements it has used in previous years, with certain adjustments to provide appropriate motivation to achieve both long- and short-term objectives that benefit shareholders, and to recruit, retain and incentivize key employees.

Impact of Regulatory Requirements

For taxable years beginning before January 1, 2018, Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), generally disallowed a tax deduction to a public company for compensation in excess of $1 million paid to the Company’s chief executive officer and any other executive officer (other than the chief financial officer) required to be reported to its shareholders under the Securities Exchange Act of 1934 (the “Exchange Act”) by reason of such executive officer being one of the four most highly compensated executive officers. However, qualifying performance-based compensation was not subject to the deduction limitation if certain requirements were met.

Congress repealed the exemption for performance-based compensation in new tax legislation enacted December 22, 2017, effective for tax years beginning after December 31, 2017, and expanded the number of employees who will be considered “covered employees” subject to the 162(m) limit to include the Chief Financial Officer (who was previously excluded) and certain former named executive officers. As a result of these changes, compensation exceeding $1 million paid to executive officers covered by Section 162(m)’s deduction limit was not deductible in 2018 nor will it be in future years.

Although we consider the tax implications of Section 162(m) of the Code, we do not have a formal policy in place requiring that part or all compensation must qualify under this section, in order to preserve flexibility with respect to the design of our compensation programs.

Section 409A of the Code provides for certain requirements that a plan that provides for the deferral of compensation must meet, including requirements relating to when payments under such a plan may be made, acceleration of benefits, and the timing of elections under such a plan. Failure to satisfy these requirements will generally lead to an accelerated of timing of inclusion in income of deferred compensation, as well as certain penalties and interest.

Compensation Policies and Risk

We do not believe that risks arising from our compensation policies and practices for our employees are reasonably likely to have a material adverse effect on the Company. We are aware that incentive compensation arrangements can be structured in such a way as to encourage undue risk-taking by executives who make decisions that tend to maximize short-term compensation at the expense of the long-term interests of the enterprise. We believe that in the past, our incentive compensation plans have motivated management to act in ways that are consistent with the long-term interests of our shareholders: promoting growth while maintaining substantial cash reserves, avoiding

debt, managing expenses and carefully evaluating potential acquisitions. We have structured current incentive compensation arrangements for executive officers in a manner consistent with past practices, and believe that those arrangements contribute to our long-term goals without encouraging undue risk-taking.

Compensation Committee Interlocks and Insider Participation

Since the beginning of fiscal 2024, no member of our Compensation Committee was an officer or employee of the Company, a former officer of the Company or had any relationship with the Company requiring disclosure under SEC regulations. During fiscal 2024, none of our executive officers served as a director or member of the compensation committee of any other entity whose executive officers served on our Board of Directors or Compensation Committee.

Compensation Committee Report

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management, and based on the Compensation Committee’s review and discussions with management, has recommended to the full Board of Directors that the Compensation Discussion and Analysis be included in our Annual Report on Form 10-K for the year ended April 30, 2024, as well as the Proxy Statement for the Annual Meeting.

Respectfully submitted by the Compensation Committee of the Board of Directors

FISCAL 2024 EXECUTIVE COMPENSATION

Summary Compensation Table

The following table reflects compensation paid to the Company’s named executive officers for fiscal 2022, fiscal 2023 and fiscal 2024.

Employment Agreements

We do not have formal employment contracts with our executive officers covering compensation matters. Accordingly, we set their compensation annually, under compensation plans individualized for each executive officer.

Retention Agreements

Upon recommendation and approval of the Compensation Committee, we entered into retention agreements with each of Messrs. James C. Edenfield, H. Allan Dow and Vincent C. Klinges on July 11, 2016 to provide for severance compensation should their employment be terminated under certain defined circumstances. We believe that such severance arrangements are key components to a competitive compensation package and are in line with companies in our peer group. In addition, we believe that these retention arrangements will help us retain our executive leadership in the event of a possible change in control and should such change in control occur, will help retain executive talent for the new organization.

The retention agreements provide for compensation to the executive in the event the executive’s employment is terminated following the consummation of a “change in control” for reasons other than the executive’s death, retirement, disability or for “cause” (as defined in the respective agreements), or if the executive voluntarily

terminates employment for “good reason” (as defined in the respective agreements). The compensation payable under the retention agreements is a lump sum severance payment equal to a multiple of the sum of the executive’s annual base salary plus the executive’s bonus for the prior year as of the date of the change in control. The multiples applicable to each person are as follows:

In addition, following termination of employment after a change in control, each of Messrs. James C. Edenfield, H. Allan Dow and Vincent C. Klinges are entitled to receive health insurance coverage (subject to a COBRA election) and certain other fringe benefits equivalent to those in effect at the date of termination for a period of twenty-four, twenty-four, and eighteen months, respectively. The retention agreements require the executive to comply with certain covenants that preclude the executive from competing with the Company or soliciting customers or employees of the Company for a period following termination of employment equal to the period for which fringe benefits are continued under the applicable agreement. The retention agreements expire upon the earlier of the executive’s termination or three years after a change in control of the Company or any successor to the Company. Accordingly, Mr. Edenfield’s retention agreement terminated on February 21, 2024, in connection with his retirement.

These retention agreements do not influence the vesting status of outstanding stock options under the 2020 Plan. However, under the 2020 Plan and, if approved, the 2024 Plan, upon the determination by the Compensation Committee in its role as the Stock Option Committee, in the event of a change in control as defined in the applicable plan, all awards may vest and become immediately exercisable in full.

A calculation of the potential post-employment payments due to our named executive officers under the agreements discussed above, assuming the triggering event for the payments occurred on the last business day of the year ended April 30, 2024, is set forth below under the heading “Potential Payments Upon Termination or Change in Control.”

Stock Options

Stock Option Plan

As of April 30, 2024, we had outstanding stock options and RSUs granted under the 2011 Plan and the 2020 Plan. All directors of the Company and all employees of the Company and its subsidiaries, totaling 331 persons as of April 30, 2024, are eligible to participate in the 2020 Plan and, if approved, the 2024 Plan. The 2020 Plan became effective on May 29, 2019 and expired on May 29, 2024. Accordingly, the Company is seeking shareholder approval for the 2024 Plan as a successor plan to the 2020 Plan.

As of April 30, 2024, there were 6,502,017 options outstanding that were issued under the 2011 Plan and 2020 Plan, in the aggregate, that remain unexercised, of which 2,725,704 were exercisable as of that date.

Stock Option Committees

Until May 29, 2024, two separate committees administered our stock option plans: (i) the Special Stock Option Committee (comprised of Messrs. Miller, Hogue, McKenna and Newberry and Mmes. Thomas, Matlock and Wu, as members of the Compensation Committee) was responsible for option grants to named executive officers and directors, and (ii) the Stock Option Committee (comprised of H. Allan Dow and, prior to his retirement, Mr. Edenfield) was responsible for other option grants. The members of these Committees were not eligible to participate in the portion of the plan that they administered, except pursuant to the formula option grant program for non-employee directors. Under the plans, the functions of these committees were to grant options and establish the terms of those options, as well as to construe and interpret the plans and adopt rules in connection with options that the particular committee grants. Except for the 2020 Plan, the function of these committees was limited to continuing and interpreting the plans. As of May 29, 2024, the Compensation Committee consolidated and absorbed the responsibilities of these two committees and is now responsible for their prior responsibilities and functions.

Fiscal 2024 Grants of Stock Options

The following table discloses the potential payouts under the stock options awarded to the named executive officers during the fiscal year ended April 30, 2024.

2024 Outstanding Equity Awards at Fiscal Year-End

The table below discloses outstanding exercisable and unexercisable equity awards outstanding as of April 30, 2024 for the named executive officers.

2024 Option Exercises and Stock Vested

The following table sets forth the actual value received by the named executive officers upon the exercise of stock options in fiscal 2024.

Potential Payments upon Termination or Change of Control

We entered into retention agreements with Messrs. James C. Edenfield, Dow and Klinges on July 11, 2016. Given Mr. Edenfield’s retirement from the Company, effective as of February 21, 2024, Mr. Edenfield is no longer eligible for such potential payments upon termination or change of control under his respective retention agreement. See “Compensation Discussion and Analysis-Retention Agreements.” The following table sets forth in tabular form estimates of the potential post-employment payments due to these named executive officers pursuant to the retention agreements discussed above, assuming the triggering events for the payments occurred on the last business day of the fiscal year ended April 30, 2024 and, in the case of Mr. Edenfield, assumes that he was employed by the Company on April 30, 2024.

PAY RATIO DISCLOSURE

As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, below is a reasonable estimate about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. H. Allan Dow, our Chief Executive Officer, President and Principal Executive Officer. For fiscal 2024, our last completed fiscal year:

We used the following methodologies, estimates and assumptions as permitted under SEC rules to identify and select the median employee for purposes of determining our reasonable estimate of pay ratio as set forth above:

DIRECTOR COMPENSATION

For fiscal 2024, Directors received cash compensation of $70,000 annually, paid on a per-fiscal quarter basis, following scheduled quarterly Board meetings. New Board members will be compensated on a pro-rated basis based on the date they join the Board. The additional annual amount of $5,000 paid to each Board Committee Chair remains unchanged and will be paid annually. In connection with Mr. Miller’s appointment as the Company’s Chairman in February 2024, the Board approved an additional annual payment of $50,000 to the Chairman of the Board. The Company will also reimburse all reasonable out-of-pocket expenses incurred by non-employee directors in attending meetings of the Board or any Committee.

Board members will also receive annual grants of Restricted Stock Units (“RSUs”) worth approximately $120,000, based on the Company’s closing share price on the award date. The award of RSUs will be subject to the 2020 Plan, or the 2024 Plan, if approved. The RSUs will vest as Class A Shares of the Company in full one year after the date of grant, subject to the Board members’ continued service on the Board through the vesting date. Until vesting, the RSUs will not entitle a Board member to voting rights, dividends, or other rights or privileges of owning Class A Shares of the Company. In addition, new Board members will receive a grant of RSUs worth approximately $25,000, based on the Company’s closing share price on the date they join the Board.

The following table provides compensation information for non-employee members of our Board for the fiscal year ended April 30, 2024.

CERTAIN TRANSACTIONS

On December 8, 2003, our Board of Directors adopted a resolution directing the Audit Committee of the Board of Directors to establish and implement procedures for identifying and conducting an appropriate review of any proposed transaction that meets the definition of “related party transaction” within the meaning of Item 404 of SEC Regulation S-K. In January 2004, the Audit Committee adopted written procedures in accordance with such direction. Under those procedures, the Audit Committee reviews and evaluates any proposed related party transaction and determines whether the terms of such transaction, judged at the time of the determination, are fair to the Company. Our officers are instructed that when a related party transaction is proposed they are to bring it to the attention of the Audit Committee, which then reviews the transaction and makes a determination of whether it meets the above standard. The Audit Committee is required to prepare a report of its deliberations, conclusions and recommendations, and furnish that report to the full Board of Directors. Since May 1, 2023, we were not a party to any transactions involving amounts in excess of $120,000 in which any related person had a direct or indirect interest, and no such transactions are currently proposed.

LEGAL PROCEEDINGS

We are not aware of any current legal proceedings involving any of our directors, director nominees, or executive officers and either the Company or any of its subsidiaries.

PROPOSAL 3: ADVISORY VOTE ON THE COMPENSATION OF OUR

NAMED EXECUTIVE OFFICERS

Pursuant to Section 14A of the Exchange Act, we are requesting that our shareholders approve, on an advisory basis, the compensation of our executive officers, each of whom is named in the Summary Compensation Table, as described in the “Compensation Discussion and Analysis” section and disclosed in the Summary Compensation Table and related compensation tables and the narrative discussion presented under “Executive Compensation” in this Proxy Statement.

Our executive compensation program has been designed to attract, retain and motivate our executive team by providing competitive compensation within our market. We believe that our executive compensation program provides an appropriate balance between salary and “at-risk” forms of incentive compensation, as well as a mix of incentives that encourage our executives to focus on both long- and short-term objectives without encouraging inappropriate risks to achieve performance.

As an advisory vote, this proposal is not binding on the Company. However, our Compensation Committee and our Board of Directors value the opinions of our shareholders expressed through your vote on this proposal and will consider the outcome of this vote in making future compensation decisions for our executive officers.

Accordingly, we will present the following resolution for vote at our 2024 Annual Meeting:

“RESOLVED, that the shareholders of the Company approve, on an advisory basis, the compensation of the Company’s named executive officers, as described in the Compensation Discussion and Analysis section and disclosed in the Summary Compensation Table and related tables and narrative discussion set forth in the Proxy Statement.”

At the 2023 Annual Meeting, held on August 22, 2023, our shareholders approved the frequency of future votes on executive compensation on an annual basis. Accordingly, our next advisory say-on-pay vote (following the non-binding advisory vote at this Annual Meeting) is expected to occur at our 2025 Annual Meeting.

The proposal to approve, on an advisory basis, the compensation of our executive officers requires the affirmative vote of the majority of the shares represented in person or by proxy at the Annual Meeting and entitled to vote on the proposal.

Each proxy solicited on behalf of our Board of Directors will be voted “FOR” the approval of the compensation of our named executive officers unless the shareholder instructs otherwise in the proxy.