Company Quick10K Filing
⚲
Asure Software
Financials
Price6.59 EPS-1
Shares16 P/E-9
MCap103 P/FCF26
Net Debt107 EBIT-2
TEV210 TEV/EBIT-114
TTM 2019-09-30, in MM, except price, ratios
Filings
10-Q 2021-03-31 Filed 2021-05-10
10-K 2020-12-31 Filed 2021-03-11
10-Q 2020-09-30 Filed 2020-11-09
10-Q 2020-06-30 Filed 2020-08-10
10-Q 2020-03-31 Filed 2020-05-11
10-K 2019-12-31 Filed 2020-03-16
10-Q 2019-09-30 Filed 2019-11-12
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-03-19
10-Q 2018-09-30 Filed 2018-11-09
10-Q 2018-06-30 Filed 2018-08-09
10-Q 2018-03-31 Filed 2018-05-10
10-K 2017-12-31 Filed 2018-03-16
10-Q 2017-09-30 Filed 2017-11-13
10-Q 2017-06-30 Filed 2017-08-14
10-Q 2017-03-31 Filed 2017-05-11
10-K 2016-12-31 Filed 2017-03-20
10-Q 2016-09-30 Filed 2016-11-14
10-Q 2016-06-30 Filed 2016-08-15
10-Q 2016-03-31 Filed 2016-05-12
10-K 2015-12-31 Filed 2016-03-30
10-Q 2015-09-30 Filed 2015-11-16
10-Q 2015-06-30 Filed 2015-08-12
10-Q 2015-03-31 Filed 2015-05-13
10-K 2014-12-31 Filed 2015-03-27
10-Q 2014-09-30 Filed 2014-11-12
10-Q 2014-06-30 Filed 2014-08-13
10-Q 2014-03-31 Filed 2014-05-14
10-K 2013-12-31 Filed 2014-03-27
10-Q 2013-09-30 Filed 2013-11-13
10-Q 2013-06-30 Filed 2013-08-14
10-Q 2013-03-31 Filed 2013-05-15
10-K 2012-12-31 Filed 2013-04-01
10-Q 2012-09-30 Filed 2012-11-19
10-Q 2012-06-30 Filed 2012-08-14
10-Q 2012-03-31 Filed 2012-05-15
10-K 2011-12-31 Filed 2012-03-30
10-Q 2011-09-30 Filed 2011-11-14
10-Q 2011-06-30 Filed 2011-08-11
10-Q 2011-03-31 Filed 2011-05-13
10-K 2010-12-31 Filed 2011-03-31
10-Q 2010-09-30 Filed 2010-11-10
10-Q 2010-06-30 Filed 2010-08-12
10-Q 2010-03-31 Filed 2010-05-17
10-Q 2009-12-31 Filed 2010-02-16
Reports
8-K 2020-12-24 Other Events
8-K 2020-12-22 Other Events, Exhibits
8-K 2020-12-18 Enter Agreement, Other Events, Exhibits
8-K 2020-11-09
8-K 2020-08-10
8-K 2020-08-10
8-K 2020-07-14
8-K 2020-07-07
8-K 2020-05-27
8-K 2020-05-07
8-K 2020-04-15
8-K 2020-04-08
8-K 2020-03-31
8-K 2020-03-12
8-K 2019-12-31
8-K 2019-12-02
8-K 2019-11-12
8-K 2019-10-07
8-K 2019-08-22
8-K 2019-08-08
8-K 2019-07-03
8-K 2019-06-05
8-K 2019-05-31
8-K 2019-05-29
8-K 2019-05-09
8-K 2019-04-15
8-K 2019-03-14
8-K 2019-01-07
8-K 2019-01-01
8-K 2018-11-09
8-K 2018-08-08
8-K 2018-07-01
8-K 2018-06-18
8-K 2018-06-14
8-K 2018-06-13
8-K 2018-05-16
8-K 2018-05-09
8-K 2018-04-09
8-K 2018-04-06
8-K 2018-03-29
8-K 2018-03-27
8-K 2018-03-15
8-K 2018-03-09
8-K 2018-01-02

ASUR 10Q Quarterly Report

Content
Part I - Financial Information
Item 1. Financial Statements
Note 1 - The Company and Basis of Presentation
Note 2 - Significant Accounting Policies
Note 3 - Investments and Fair Value Measurements
Note 4 - Goodwill and Other Intangible Assets
Note 5 - Notes Payable
Note 6 - Contracts with Customers and Revenue Concentration
Note 7 - Leases
Note 8 - Share - Based Compensation
Note 9 - Net Loss per Share
Note 10 - Subsequent Events
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
Exhibits
EX-31.1 exhibit3111.htm
EX-31.2 exhibit3121.htm
EX-32.1 exhibit3211.htm
EX-32.2 exhibit3221.htm

Asure Software Earnings 2021-03-31

Balance SheetIncome StatementCash Flow
0.40.30.20.20.10.02012201420172020
Assets, Equity
 0.10.10.0-0.0-0.1-0.12012201420172020
Rev, G Profit, Net Income
 0.10.10.0-0.0-0.1-0.12012201420172020
Ops, Inv, Fin
asur-20210331
12-31false00008841442021Q1straight-line methodP1YP5Y00008841442021-01-012021-03-310000884144us-gaap:CommonClassAMember2021-01-012021-03-310000884144us-gaap:SeriesAPreferredStockMember2021-01-012021-03-31xbrli:shares00008841442021-05-06iso4217:USD00008841442021-03-3100008841442020-12-31iso4217:USDxbrli:shares0000884144asur:RecurringMember2021-01-012021-03-310000884144asur:RecurringMember2020-01-012020-03-310000884144asur:ProfessionalServicesRevenueMember2021-01-012021-03-310000884144asur:ProfessionalServicesRevenueMember2020-01-012020-03-3100008841442020-01-012020-03-310000884144us-gaap:CommonStockMember2020-12-310000884144us-gaap:TreasuryStockMember2020-12-310000884144us-gaap:AdditionalPaidInCapitalMember2020-12-310000884144us-gaap:RetainedEarningsMember2020-12-310000884144us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000884144us-gaap:CommonStockMember2021-01-012021-03-310000884144us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310000884144us-gaap:RetainedEarningsMember2021-01-012021-03-310000884144us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000884144us-gaap:CommonStockMember2021-03-310000884144us-gaap:TreasuryStockMember2021-03-310000884144us-gaap:AdditionalPaidInCapitalMember2021-03-310000884144us-gaap:RetainedEarningsMember2021-03-310000884144us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310000884144us-gaap:CommonStockMember2019-12-310000884144us-gaap:TreasuryStockMember2019-12-310000884144us-gaap:AdditionalPaidInCapitalMember2019-12-310000884144us-gaap:RetainedEarningsMember2019-12-310000884144us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-3100008841442019-12-310000884144us-gaap:CommonStockMember2020-01-012020-03-310000884144us-gaap:AdditionalPaidInCapitalMember2020-01-012020-03-310000884144us-gaap:RetainedEarningsMember2020-01-012020-03-310000884144us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-03-310000884144us-gaap:CommonStockMember2020-03-310000884144us-gaap:TreasuryStockMember2020-03-310000884144us-gaap:AdditionalPaidInCapitalMember2020-03-310000884144us-gaap:RetainedEarningsMember2020-03-310000884144us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-3100008841442020-03-31asur:challengeasur:productLine0000884144asur:FundsHeldForClientsMember2021-03-310000884144asur:FundsHeldForClientsMember2020-12-310000884144us-gaap:CashAndCashEquivalentsMember2021-03-310000884144us-gaap:CashAndCashEquivalentsMember2020-12-310000884144us-gaap:CertificatesOfDepositMember2021-03-310000884144us-gaap:CorporateDebtSecuritiesMember2021-03-310000884144us-gaap:MunicipalBondsMember2021-03-310000884144us-gaap:USGovernmentAgenciesDebtSecuritiesMember2021-03-310000884144us-gaap:AssetBackedSecuritiesMember2021-03-310000884144us-gaap:CertificatesOfDepositMember2020-12-310000884144us-gaap:CorporateDebtSecuritiesMember2020-12-310000884144us-gaap:MunicipalBondsMember2020-12-310000884144us-gaap:USGovernmentAgenciesDebtSecuritiesMember2020-12-310000884144us-gaap:AssetBackedSecuritiesMember2020-12-31asur:security0000884144asur:IndividuallyMember2021-03-310000884144asur:IndividuallyMember2020-12-310000884144asur:July2020AcquisitionMember2020-07-012020-07-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2021-03-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2021-03-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2021-03-310000884144us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2021-03-310000884144us-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2020-12-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2020-12-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2020-12-310000884144us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AvailableforsaleSecuritiesMember2020-12-310000884144us-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000884144us-gaap:CustomerRelationshipsMember2021-01-012021-03-310000884144us-gaap:CustomerRelationshipsMember2021-03-310000884144us-gaap:DevelopedTechnologyRightsMember2021-01-012021-03-310000884144us-gaap:DevelopedTechnologyRightsMember2021-03-310000884144asur:ResellerRelationshipsMember2021-01-012021-03-310000884144asur:ResellerRelationshipsMember2021-03-310000884144us-gaap:TradeNamesMember2021-01-012021-03-310000884144us-gaap:TradeNamesMember2021-03-310000884144us-gaap:NoncompeteAgreementsMember2021-01-012021-03-310000884144us-gaap:NoncompeteAgreementsMember2021-03-310000884144us-gaap:CustomerRelationshipsMember2020-01-012020-12-310000884144us-gaap:CustomerRelationshipsMember2020-12-310000884144us-gaap:DevelopedTechnologyRightsMember2020-01-012020-12-310000884144us-gaap:DevelopedTechnologyRightsMember2020-12-310000884144asur:ResellerRelationshipsMember2020-01-012020-12-310000884144asur:ResellerRelationshipsMember2020-12-310000884144us-gaap:TradeNamesMember2020-01-012020-12-310000884144us-gaap:TradeNamesMember2020-12-310000884144us-gaap:NoncompeteAgreementsMember2020-01-012020-12-310000884144us-gaap:NoncompeteAgreementsMember2020-12-3100008841442020-01-012020-12-31xbrli:pure0000884144asur:AcquisitionsMembersrt:MinimumMemberus-gaap:NotesPayableOtherPayablesMember2021-03-310000884144asur:AcquisitionsMembersrt:MaximumMemberus-gaap:NotesPayableOtherPayablesMember2021-03-310000884144us-gaap:NotesPayableOtherPayablesMember2021-03-310000884144us-gaap:NotesPayableOtherPayablesMember2020-12-310000884144asur:PinnacleBankMember2021-03-310000884144asur:PinnacleBankMember2020-12-310000884144us-gaap:NotesPayableOtherPayablesMemberasur:WellsFargoSyndicatedPartnerMember2021-03-310000884144us-gaap:NotesPayableOtherPayablesMemberasur:WellsFargoSyndicatedPartnerMember2020-12-310000884144us-gaap:MediumTermNotesMemberasur:CreditAmendmentMember2020-12-310000884144us-gaap:RevolvingCreditFacilityMemberasur:CreditAmendmentMember2020-12-310000884144asur:PinnacleBankMemberasur:PPPLoanMembersrt:MaximumMember2021-01-012021-03-310000884144us-gaap:AccountsReceivableMember2021-01-012021-03-310000884144us-gaap:AccountsReceivableMember2020-01-012020-12-3100008841442021-04-012021-03-310000884144srt:MinimumMember2021-03-310000884144srt:MaximumMember2021-03-310000884144us-gaap:BuildingMember2021-03-310000884144us-gaap:BuildingMember2020-12-31asur:plan0000884144us-gaap:StockOptionMember2021-01-012021-03-310000884144us-gaap:StockOptionMember2020-01-012020-03-31

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________________
FORM 10-Q
___________________________________________
(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2021
OR
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                  to 
Commission file number: 1-34522
ASURE SOFTWARE, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
3700 N. Capital of Texas Hwy #350
Austin, Texas
(Address of Principal Executive Offices)
74-2415696
(I.R.S. Employer
Identification No.)
78746
(Zip Code)
(512) 437-2700
(Registrant’s Telephone Number, including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.01 par valueASUR
Nasdaq Capital Market
Series A Junior Participating Preferred Share Purchase RightsN/AN/A
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒     No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes ☒     No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer☐Accelerated filer☐Non-accelerated filer☒Smaller reporting company☒
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐  No ☒
As of May 6, 2021, 19,033,872 shares of the registrant’s Common Stock were outstanding. 

Table of Contents
TABLE OF CONTENTS
Page
Number

2
Table of Contents
PART I - FINANCIAL INFORMATION
ITEM 1.    FINANCIAL STATEMENTS
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
March 31, 2021December 31, 2020
(unaudited)
Assets
Current assets:
Cash and cash equivalents$24,290 $28,577 
Accounts receivable, net of allowance for doubtful accounts of $1,909 and $2,194 at March 31, 2021 and December 31, 2020, respectively
3,873 3,354 
Inventory349 449 
Prepaid expenses and other current assets3,372 3,284 
Total current assets before funds held for clients31,884 35,664 
Funds held for clients254,492 321,069 
Total current assets286,376 356,733 
Property and equipment, net8,662 8,281 
Goodwill73,958 73,958 
Intangible assets, net61,646 64,552 
Operating lease assets, net6,354 6,450 
Other assets, net4,107 3,953 
Total assets$441,103 $513,927 
Liabilities and stockholders’ equity
Current liabilities:
Current portion of notes payable$11,901 $12,310 
Accounts payable750 1,288 
Accrued compensation and benefits3,610 2,916 
Operating lease liabilities, current1,985 1,833 
Other accrued liabilities1,064 1,380 
Contingent purchase obligation3,880 3,880 
Deferred revenue1,605 4,343 
Total current liabilities before client fund obligations24,795 27,950 
Client fund obligations254,241 320,577 
Total current liabilities279,036 348,527 
Long-term liabilities:
Deferred revenue86 111 
Deferred tax liability985 888 
Notes payable, net of current portion10,683 12,225 
Operating lease liabilities, noncurrent5,076 5,366 
Other liabilities586 1,157 
Total long-term liabilities17,416 19,747 
Total liabilities296,452 368,274 
Commitments
Stockholders’ equity:
Preferred stock, $0.01 par value; 1,500 shares authorized; none issued or outstanding
— — 
Common stock, $0.01 par value; 44,000 and 22,000 shares authorized; 19,405 and 19,354 shares issued, 19,021 and 18,970 shares outstanding at March 31, 2021 and December 31, 2020, respectively
194 193 
Treasury stock at cost, 384 shares at March 31, 2021 and December 31, 2020
(5,017)(5,017)
Additional paid-in capital420,561 419,827 
Accumulated deficit(271,552)(269,954)
Accumulated other comprehensive income465 604 
Total stockholders’ equity144,651 145,653 
Total liabilities and stockholders’ equity$441,103 $513,927 
The accompanying notes are an integral part of these condensed consolidated financial statements. 

Table of Contents
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Amounts in thousands, except share and per share data)
(Unaudited)
Three Months Ended
March 31,
20212020
Revenue:
Recurring$19,242 $18,436 
Professional services, hardware and other560 511 
Total revenue19,802 18,947 
Cost of Sales7,310 7,840 
Gross profit12,492 11,107 
Operating expenses:
Sales and marketing3,611 3,575 
General and administrative6,498 5,522 
Research and development1,124 1,174 
Amortization of intangible assets2,528 2,349 
Total operating expenses13,761 12,620 
Loss from operations(1,269)(1,513)
Interest expense and other, net(224)(235)
Loss from operations before income taxes(1,493)(1,748)
Income tax expense105 19 
Net loss(1,598)(1,767)
Other comprehensive income:
Unrealized (loss) gain on marketable securities(139)65 
Comprehensive loss$(1,737)$(1,702)
Basic and diluted net loss per share
Basic$(0.08)$(0.11)
Diluted$(0.08)$(0.11)
Weighted average basic and diluted shares
Basic19,007,000 15,727,000 
Diluted19,007,000 15,727,000 
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
Table of Contents
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Amounts in thousands)
(Unaudited)
Common Stock OutstandingCommon Stock AmountTreasury StockAdditional Paid-in CapitalAccumulated DeficitOther Comprehensive Income (Loss)Total Stockholders' Equity
Balance at December 31, 202018,970 $193 $(5,017)$419,827 $(269,954)$604 $145,653 
Stock issued upon option exercise and vesting of restricted stock units51 1 — 131 — — 132 
Share based compensation— — — 626 — — 626 
Share issuance costs— — — (23)— — (23)
Net loss— — — — (1,598)— (1,598)
Other comprehensive loss— — — — — (139)(139)
Balance at March 31, 202119,021 $194 $(5,017)$420,561 $(271,552)$465 $144,651 

Common Stock
Outstanding		Common Stock AmountTreasury StockAdditional Paid-in
Capital		Accumulated DeficitOther Comprehensive
Income (Loss)		Total Stockholders'
Equity
Balance at December 31, 201915,714 $161 $(5,017)$396,102 $(253,642)$(25)$137,579 
Stock issued upon option exercise and vesting of restricted stock units29 — — 106 — — 106 
Share based compensation— — — 438 — — 438 
Net loss— — — — (1,767)— (1,767)
Other comprehensive income— — — — — 65 65 
Balance at March 31, 202015,743 $161 $(5,017)$396,646 $(255,409)$40 $136,421 
The accompanying notes are an integral part of these condensed consolidated financial statements. 

5
Table of Contents
ASURE SOFTWARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
Three Months Ended March 31,
20212020
Cash flows from operating activities:
Net loss$(1,598)$(1,767)
Adjustments to reconcile loss to net cash (used in) provided by operations:
Depreciation and amortization3,862 3,516 
Amortization of operating lease assets421 386 
Amortization of debt financing costs and discount30 75 
Provision for (recovery of) doubtful accounts1 75 
Provision for deferred income taxes98 8 
Gain on modification of debt— (36)
Share-based compensation626 438 
Changes in operating assets and liabilities:
Accounts receivable(210)806 
Inventory44 84 
Prepaid expenses and other assets(552)(900)
Accounts payable(538)(982)
Accrued expenses and other long-term obligations(195)(1,392)
Operating lease liabilities(462)(405)
Deferred revenue(2,762)(3,309)
Net cash used in operating activities(1,235)(3,403)
Cash flows from investing activities:
Acquisition of intangible asset— (1,823)
Purchases of property and equipment(48)(241)
Software capitalization costs(1,233)(844)
Net change in funds held for clients66,439 27,714 
Net cash provided by investing activities65,158 24,806 
Cash flows from financing activities:
Payments of notes payable(1,981)(1,784)
Debt financing fees— (20)
Net proceeds from issuance of common stock108 106 
Net change in client fund obligations(66,337)(27,751)
Net cash used in financing activities(68,210)(29,449)
Net decrease in cash and cash equivalents(4,287)(8,046)
Cash and cash equivalents at beginning of period28,577 28,826 
Cash and cash equivalents at end of period$24,290 $20,780 
Supplemental information:
Cash paid for:
Interest$219 $99 
Income taxes183 — 
The accompanying notes are an integral part of these condensed consolidated financial statements. 
6

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)


NOTE 1 – THE COMPANY AND BASIS OF PRESENTATION
Asure Software, Inc., (“Asure”, the “Company”, “we” and “our”), a Delaware corporation, is a leading provider of cloud-based Human Capital Management (“HCM”) software solutions. We help small and mid-sized companies grow by assisting them in building better teams with skills that reach the next level, stay compliant with ever-changing federal, state, and local tax jurisdictions and labor laws, and better allocate cash so they can spend their financial capital on growing their business rather than back-office overhead expenses. Asure’s Human Capital Management suite, named Asure HCM, includes cloud-based Payroll, Tax Services, and Time & Attendance software as well as HR Services ranging from HR projects to completely outsourcing payroll and HR staff. We also offer these products and services through our network of reseller partners.
Our platform vision is to help clients grow their business and become the most trusted HCM resource to entrepreneurs everywhere. Our product strategy is driven by three primary challenges that prevent businesses from growing: HR complexity, allocation of both human and financial capital, and the ability to build great teams. The Asure HCM suite includes four product lines: Asure Payroll & Tax, Asure HR, Asure Time & Attendance, and Asure HRServices.
We develop, market, sell and support our offerings nationwide through our principal office in Austin, Texas and from our processing hubs in California, Tennessee, Nebraska, New York, Florida, Vermont, and Washington.
We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") and accordingly, they do not include all information and footnotes required under U.S. generally accepted accounting principles ("U.S. GAAP") for complete financial statements. Certain reclassifications were made to conform to the current period presentation in the condensed consolidated statements of comprehensive loss.
In the opinion of management, these interim financial statements contain all adjustments, consisting of normal, recurring adjustments, necessary for a fair presentation of our financial position as of March 31, 2021 and the results of operations, statements of changes in stockholders' equity for the three months ended March 31, 2021 and March 31, 2020, and our statements of cash flows for the three months ended March 31, 2021 and March 31, 2020.
These condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto filed with the SEC in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (our "2020 Annual Report on Form 10-K"). The results for the interim periods are not necessarily indicative of results for a full fiscal year.
NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
Preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are subjective in nature and involve judgments. The more significant estimates made by management include the valuation allowance for the gross deferred tax assets, useful lives of fixed assets, the determination of the fair value of its long-lived assets, and the fair value of assets acquired and liabilities assumed during acquisitions. We base our estimates on historical experience and on various other assumptions management believes reasonable under the given circumstances. These estimates could be materially different under different conditions and assumptions. Additionally, the actual amounts could differ from the estimates made. Management periodically evaluates estimates used in the preparation of the consolidated financial statements for continued reasonableness. We make appropriate adjustments, if any, to the estimates used prospectively based upon such periodic evaluation.
7

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

SIGNIFICANT RISKS AND UNCERTAINTIES
The coronavirus ("COVID-19") pandemic has resulted in a global economic slowdown and disruptions that have and could continue to negatively impact our business. The pandemic and numerous measures implemented to contain the virus such as business shutdowns, shelter-in-place orders and travel bans and restrictions have caused businesses, especially small and medium sized businesses some of whom are our customers, to reduce headcount or cease operations as customer demand decreased. Given the economic slowdown and other risks and uncertainties associated with the pandemic, we expect that our business, financial condition, results of operations and growth prospects will be adversely affected in the future. Our business is impacted by employment levels as we have contracts that charge clients on a per-employee basis. In addition, the conditions caused by the COVID-19 pandemic could adversely affect our customers’ ability or willingness to purchase our offerings, delay prospective customers’ purchasing decisions, delay the provisioning of our offerings, lengthen payment terms, reduce the value or duration of customer subscription contracts, or affect attrition rates, all of which could adversely affect our future sales, operating results and overall financial performance.
The duration and extent of the impact from the COVID-19 pandemic depends on future developments that cannot be accurately predicted at this time, such as the severity and transmission rate of the virus, the extent and effectiveness of containment actions, including the administration of vaccinations and the impact of these and other factors on our employees, customers, partners and vendors. If we are not able to respond to and manage the impact of such events effectively, our business will be harmed.
RECENT ACCOUNTING PRONOUNCEMENTS
In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement (Topic 820). The new guidance modifies disclosure requirements related to fair value measurement. We adopted the standard on January 1, 2020. The adoption of this standard did not have an impact on our financial statements and disclosures.
In August 2018, the FASB issued ASU No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40). The new guidance reduces complexity for the accounting for costs of implementing a cloud computing service arrangement and aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). We adopted the standard on January 1, 2020 prospectively to all implementation costs incurred after the date of adoption. The effects of this standard on our financial position, results of operations and cash flows were not material.
In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The standard became effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. We adopted ASU 2019-12 during the quarter beginning January 1, 2021, using the prospective approach except for hybrid tax regimes, which we adopted using the modified retrospective approach. The adoption of ASU 2019-12 resulted in no material impact to the Company's financial statements.
CONTINGENCIES
Although we have been, and in the future may be, the defendant or plaintiff in various actions arising in the normal course of business, as of March 31, 2021, we were not a party to any pending legal proceedings that are material to our business.
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
As of March 31, 2021 and December 31, 2020, accumulated other comprehensive income consisted of net unrealized gains and losses on available-for-sale securities.

8

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

NOTE 3 – INVESTMENTS AND FAIR VALUE MEASUREMENTS
As of March 31, 2021 and December 31, 2020, funds held for clients invested in available-for-sale securities consisting of government and commercial bonds, including mortgage-backed securities, amounted to $24,233 and $25,919, respectively. As of March 31, 2021, and December 31, 2020, funds held for clients invested in money market funds and other cash equivalents amounted to $1,082 and $63,999, respectively. Additionally, as of March 31, 2021 and December 31, 2020, we had $3,301 and $5,204, respectively, of operating funds in money market funds, classified as cash equivalents.
Investments classified as available-for-sale consisted of the following:
March 31, 2021
Amortized
Cost
Gross
Unrealized
Gains (1)
Gross
Unrealized
Losses (1)
Aggregate
Estimated
Fair Value
Funds Held for Clients (2)
Certificates of deposit$7,119 $165 $— $7,284 
Corporate debt securities8,894 213 (4)9,103 
Municipal bonds7,254 99 — 7,353 
US Government agency securities500 — (7)493 
Asset-backed securities— — — — 
Total$23,767 $477 $(11)$24,233 
December 31, 2020
Amortized
Cost
Gross
Unrealized
Gains (1)
Gross
Unrealized
Losses (1)
Aggregate
Estimated
Fair Value
Funds Held for Clients (2)
Certificates of deposit$7,370 $204 $— $7,574 
Corporate debt securities9,415 297 (1)9,711 
Municipal bonds7,531 103 (1)7,633 
US Government agency securities500 1 — 501 
Asset-backed securities499 1 — 500 
Total$25,315 $606 $(2)$25,919 
(1)Unrealized gains and losses on available-for-sale securities are included as a component of comprehensive loss. As of March 31, 2021 and December 31, 2020, there were 63 and 69 securities, respectively, in an unrealized gain position and there were 2 and 2 securities, respectively, in an unrealized loss position. As of March 31, 2021, we had $(11) in unrealized losses. As of March 31, 2021, these unrealized losses were less than$(7) individually and $(11) in the aggregate. As of December 31, 2020, these unrealized losses were less than $(1) individually and $(2) in the aggregate. No securities have been in a continuous unrealized loss position for more than 12 months. We do not intend to sell these investments and we do not expect to sell these investments before recovery of their amortized cost basis, which may be at maturity. We review our investments to identify and evaluate investments that indicate possible other-than-temporary impairment. Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the investee, and our intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value.
(2)At March 31, 2021 and December 31, 2020, none of these securities were classified as cash and cash equivalents on the accompanying condensed consolidated balance sheets.

9

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

Expected maturities of available-for-sale securities as of March 31, 2021 are as follows:
Expected MaturitiesAmount
  
One year or less$4,228 
After one year through five years20,005 
After five years through 10 years— 
After 10 years— 
 $24,233 
In July 2020, we acquired certain assets of a payroll tax business. The initial purchase price for the assets was $4,250, which we paid cash at closing. The seller will be paid additional consideration for the assets based on the trailing twelve-month revenue at each of April 30, 2021 and October 31, 2021. Contingent purchase consideration, if any, will generally be made by May 30, 2021 and December 30, 2021. The payment of the contingent consideration paid will be contingent on certain thresholds set forth in the asset purchase agreement. We utilized a Monte Carlo simulation to determine the fair value of the contingent consideration. There was no adjustment to the fair value of the contingent consideration at March 31, 2021.
Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures defines fair value, establishes a framework for measuring fair value in U.S. GAAP and expands disclosures about fair value measurements.
ASC 820 establishes a three-tier fair value hierarchy, which is based on the reliability of the inputs used in measuring fair values. These tiers include:
Level 1:    Quoted prices in active markets for identical assets or liabilities;
Level 2:    Quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active for identical or similar assets or liabilities; and model-driven valuations whose significant inputs are observable; and
Level 3:    Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
10

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

The following table presents the fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020, respectively:
 March 31, 2021
 Total Carrying ValueQuoted Prices in Active Market
(Level 1)		Significant Other Observable Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Assets:    
Cash equivalents      
Money market funds$3,301 $3,301 $— $— 
Funds held for clients
Money market funds1,082 1,082 — — 
Available-for-sale securities24,233 — 24,233 — 
Total$28,616 $4,383 $24,233 $— 
Liabilities:
Contingent purchase consideration$3,880 $— $— $3,880 
Total$3,880 $— $— $3,880 
 
 December 31, 2020
 Total Carrying ValueQuoted Prices in Active Market
(Level 1)		Significant Other Observable Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Assets:    
Cash equivalents  
Money market funds$5,204 $5,204 $— $— 
Funds held for clients
Money market funds63,999 63,999 — — 
Available-for-sale securities25,919 — 25,919 — 
Total$95,122 $69,203 $25,919 $— 
Liabilities:
Contingent purchase consideration$3,880 $— $— $3,880 
Total$3,880 $— $— $3,880 

11

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

NOTE 4 – GOODWILL AND OTHER INTANGIBLE ASSETS
As of March 31, 2021 and December 31, 2020, goodwill was $73,958. The Company evaluates the recoverability of goodwill annually and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. As of March 31, 2021, there has been no impairment of goodwill based on the qualitative assessments performed by the Company.
The gross carrying amount and accumulated amortization of our intangible assets as of March 31, 2021 and December 31, 2020 are as follows:
 March 31, 2021
Intangible AssetsWeighted Average
Amortization
Period
(in Years)		GrossAccumulated
Amortization		Net
Customer relationships8.9$88,310 $(31,350)$56,960 
Developed technology6.612,001 (7,987)4,014 
Reseller relationships7.0853 (853)— 
Trade names3.0880 (379)501 
Noncompete agreements5.21,032 (861)171 
 8.6$103,076 $(41,430)$61,646 


 December 31, 2020
Intangible AssetsWeighted Average
Amortization
Period
(in Years)		GrossAccumulated
Amortization		Net
Customer relationships8.9$88,310 $(28,898)$59,412 
Developed technology6.612,001 (7,608)4,393 
Reseller relationships7.0853 (853)— 
Trade names3.0880 (312)568 
Noncompete agreements5.21,032 (853)179 
 8.5$103,076 $(38,524)$64,552 
We record amortization expenses using the straight-line method over the estimated useful lives of the intangible assets, as noted above.  Amortization expenses recorded in Operating Expenses were $2,528 and $2,349 for the three months ended March 31, 2021 and 2020, respectively. Amortization expenses recorded in Cost of Sales were $379 and $431 for the three months ended March 31, 2021 and 2020, respectively. There is no impairment of intangibles during the three months ended March 31, 2021 based on the qualitative assessment performed by the Company.
12

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

The following table summarizes the future estimated amortization expense relating to our intangible assets as of March 31, 2021:
Calendar YearsAmount
2021 (April to December)$8,695 
202211,068 
20239,942 
20249,682 
20258,896 
Thereafter13,363 
 $61,646 

NOTE 5 – NOTES PAYABLE
The following table summarizes our outstanding debt as of the dates indicated:1
 MaturityStated Interest RateMarch 31, 2021December 31, 2020
Subordinated Notes Payable – acquisitions7/1/2021 – 7/1/2022
2.00% - 3.00%
$4,263 $6,182 
PPP Loan – Pinnacle Bank1
4/15/20221.00 %8,856 8,856 
Term Loan – Wells Fargo Syndicate Partner12/31/20245.25 %9,813 9,875 
Total Notes Payable $22,932 $24,913 
Short-term Notes Payable 12,024 12,388 
Long-term Notes Payable $10,908 $12,525 

(1)Information presented in each of the tables this Note 5 includes principal and interest due under the terms of a promissory note with Pinnacle Bank. This loan was issued to us in connection with the Paycheck Protection Program pursuant to Title I of the Coronavirus Aid, Relief and Economic Security Act ("the PPP"). Under the terms of the PPP, the principal balance and interest due under the promissory note will be forgiven if we meet certain conditions related to the use of the loan proceeds. Under the terms of our promissory note with Pinnacle Bank, we would have been required to make payments on this promissory note in November 2020; however, the Small Business Administration ("the SBA") issued guidance, prior to that date, that deferred all payments that would be owed on this loan until after the SBA makes a decision on our loan forgiveness application. While we expect that the entire loan will be forgiven, we cannot be certain that the SBA will grant forgiveness of our entire loan or a significant portion of the loan. If we do not receive forgiveness of our entire loan, we will be obligated to start making payments on the portion of the principal and interest that is not forgiven so that it will be fully repaid no later than April 15, 2022, unless we are able to negotiate new payment terms with Pinnacle Bank. We filed our initial application for forgiveness in December 2020, and completed our application in early February 2021.

13

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

The following table summarizes the debt issuance costs as of the dates indicated:
 March 31, 2021
 Gross Notes PayableDebt Issuance Costs and Debt DiscountNet Notes Payable
Notes payable, current portion1
$12,024 $(123)$11,901 
Notes payable, net of current portion2
10,908 (226)10,682 
Total$22,932 $(349)$22,583 
(1)Net Notes Payable includes $8,358 of Gross Notes Payables and $0 Debt Issuance Cost and Debt Discount related to our PPP loan with Pinnacle Bank, all or a portion of which we expect will be forgiven and for which we are not obligated to make any payments until the Small Business Administration has made a decision regarding our application for loan forgiveness. 
(2)Net Notes Payable, includes $498 of Gross Notes Payables and $0 Debt Issuance Cost and Debt Discount related to our PPP loan with Pinnacle Bank, all or a portion of which we expect will be forgiven and for which we are not obligated to make payments until the SBA has made a decision regarding our application for loan forgiveness.
 December 31, 2020
 Gross Notes PayableDebt Issuance Costs and Debt DiscountNet Notes Payable
Notes payable, current portion1
$12,388 $(78)$12,310 
Notes payable, net of current portion2
12,525 (300)12,225 
Total$24,913 $(378)$24,535 
(1)Net Notes Payable includes $6,866 of Gross Notes Payables and $0 Debt Issuance Cost and Debt Discount related to our PPP loan with Pinnacle Bank, all or a portion of which we expect will be forgiven and for which we are not obligated to make any payments until the SBA has made a decision regarding our application for loan forgiveness. 
(2)Net Notes Payable, includes $1,989 of Gross Notes Payables and $0 Debt Issuance Cost and Debt Discount related to our PPP loan with Pinnacle Bank, all or a portion of which we expect will be forgiven and for which we are not obligated to make payments until the SBA has made a decision regarding our application for loan forgiveness.

The following table summarizes the future principal payments related to our outstanding debt as of March 31, 2021:
Year EndingAmount
2021 (remainder)$10,407 
20223,400 
2023500 
20248,625 
2025— 
Total$22,932 


14

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

Senior Credit Facility with Wells Fargo N.A.
In March 2014, we entered into a credit agreement (the “Credit Agreement”) with Wells Fargo, as administrative agent, and the lenders that are party thereto. The Credit Agreement contains customary events of default, including, among others, payment defaults, covenant defaults, judgment defaults, bankruptcy and insolvency events, cross defaults to certain indebtedness, incorrect representations or warranties, and change of control. In some cases, the defaults are subject to customary notice and grace period provisions. In March 2014 and in connection with the Credit Agreement, we and our wholly owned active subsidiaries entered into a Guaranty and Security Agreement with Wells Fargo Bank. Under the Guaranty and Security Agreement, we and each of our wholly owned active subsidiaries have guaranteed all obligations under the Credit Agreement and granted a security interest in substantially all of our and our subsidiaries’ assets. The Credit Agreement has been amended and restated multiple times, with the most recent amendment and restatement effective December 31, 2019. As described below, the Credit Agreement was amended during 2020, with the most recent amendment effective August 10, 2020.
Following the amendment, the Credit Agreement provided for $10,000 in term loans and a $5,000 revolver and provided for new applicable margin rates for determining the interest payable on loans and amended certain of our financial covenants as described in our Form 10-K filed with the SEC on March 9, 2021. We expect to be in compliance with these amended financial covenants over the next twelve months.   
As of March 31, 2021 and December 31, 2020, no amount was outstanding and $4,500, respectively, was available for borrowing under the revolver.
PPP Loan
Due to the effects of COVID-19 on our business and the related need to support our operations, we applied for and received a loan from Pinnacle Bank under the PPP during the second quarter of 2020. Under the terms of our note with Pinnacle Bank, principal payments would have begun in November 2020. However, the SBA, which administers loans issued under the PPP, has issued guidance, deferring all payments that would be owed on this loan until the SBA makes a decision on our loan forgiveness application. While we expect that the entire loan will be forgiven, we cannot be certain that the SBA will forgive our entire loan. If we do not receive forgiveness of our entire loan, we will be obligated to begin repaying the portion of the principal and interest that is not forgiven such that it is fully paid no later than April 15, 2022, unless we are able to negotiate new payment terms with Pinnacle Bank. Further, if the portion of the PPP Loan that is not forgiven (the “Unforgiven Debt”) exceeds $3,250 or requires monthly payments of principal and interest in excess of $185, it is likely we will be in default under our Credit Agreement unless we obtain a waiver from our senior lender or are otherwise able to negotiate acceptable terms with our senior lender and Pinnacle Bank. We filed our initial application for forgiveness of this loan in December 2020, and completed our application in early February 2021. Given this timing, we expect that payments we may owe, if any, would not start until second or third quarter of 2021. Under U.S. GAAP, we are required to report this entire loan as outstanding debt in our financial statements and further identify the current portion of this debt (e.g. amounts which would be payable in the next 12 months) with reference to the actual terms of our note with Pinnacle Bank. Notwithstanding how this loan is reported in our financial statements, we do not expect to make any payments on this note until at least second quarter of 2021, and then only to the extent that any portion of this note is not forgiven in accordance with the terms of the PPP.
NOTE 6 – CONTRACTS WITH CUSTOMERS AND REVENUE CONCENTRATION
Receivables
Receivables from contracts with customers, net of allowance for doubtful accounts of $1,909 were $3,873 at March 31, 2021.  Receivables from contracts with customers, net of allowance for doubtful accounts of $2,194 were $3,354 at December 31, 2020. As of March 31, 2021, one customer represented 5% of our net accounts receivable balance. No customers represented more than 10% of our net accounts receivable balance as of December 31, 2020.

15

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

Deferred Commissions
Deferred commission costs from contracts with customers were $4,128 and $3,792 at March 31, 2021 and December 31, 2020, respectively. The amount of amortization recognized for the three months ended March 31, 2021 and for the three months ended March 31, 2020 was $232 and $249, respectively.
Deferred Revenue
During the three months ended March 31, 2021 and 2020, revenue of $3,406 and $2,704 was recognized from the deferred revenue balance at the beginning of each period.
Transaction Price Allocated to the Remaining Performance Obligations
As of March 31, 2021, approximately $24,563 of revenue is expected to be recognized from remaining performance obligations. We expect to recognize revenue on approximately 65% of these remaining performance obligations over the next 12 months, with the balance recognized thereafter.
Revenue Concentration
During the three months ended March 31, 2021 and 2020, there were no customers that individually represented 10% or more of consolidated revenue.
NOTE 7 – LEASES
We have entered into office space lease agreements, which qualify as operating leases under ASU No. 2016-02, “Leases (Topic 842)”. Under such leases, the lessors receive annual minimum (base) rent. The leases have original terms (excluding extension options) ranging from one to ten years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
We record base rent expense under the straight-line method over the term of the lease. In the accompanying condensed consolidated statements of comprehensive loss, rent expense is included in operating expenses under selling, general and administrative expenses. The components of the rent expense for the three months ended March 31, 2021 and 2020 were as follows:
 Three Months Ended March 31,
 20212020
Operating lease cost$570 $552 
Sublease income(11)(48)
Net rent expense$559 $504 
For purposes of calculating the operating lease assets and lease liabilities, extension options are not included in the lease term unless it is reasonably certain we will exercise the option, or the lessor has the sole ability to exercise the option. The weighted average discount rate of our operating leases is 8% and 9% as of March 31, 2021 and December 31, 2020, respectively. The weighted average remaining lease term is five and six years as of March 31, 2021 and December 31, 2020, respectively.
Supplemental cash flow information related to operating leases for the three months ended March 31, 2021 and 2020 follow:
16

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

 Three Months Ended March 31,
 20212020
Cash paid for amounts included in the measurement of lease liabilities:  
Operating cash outflows from operating leases$609 $573 
Non-cash operating activities:
Operating lease assets obtained in exchange for new operating lease liabilities$325 $— 
Future minimum commitments over the life of all operating leases, which exclude variable rent payments, are as follows:
Year Ending December 31Operating Leases
2021 (remainder)$1,854 
20221,949 
20231,256 
20241,037 
2025828 
Thereafter1,803 
Total minimum lease payments8,727 
Less imputed interest(1,666)
Total lease liabilities$7,061 

NOTE 8 – SHARE-BASED COMPENSATION
We have one active equity plan, the 2018 Incentive Award Plan (the “2018 Plan”). The 2018 Plan, approved by our shareholders, replaced our 2009 Equity Incentive Plan, as amended (the “2009 Plan”), however, the terms and conditions of the 2009 Plan continue to govern any outstanding awards previously granted under the 2009 Plan.
The number of shares available for issuance under the 2018 Plan is equal to the sum of (i) 2,350,000 shares, and (ii) any shares subject to issued and outstanding awards under the 2009 Plan as of the effective date of the 2018 Plan that expire, are canceled or otherwise terminate following the effective date of the 2018 Plan. We have outstanding options to purchase 1,465,985 shares at a weighted average exercise price of $7.89. During the three months ending March 31, 2021 we issued 307,500 of employee stock options. The weighted average exercise price of these awards was $7.53 for the three months ended March 31, 2021. These awards will vest over a three-year period. We also had 388,273 outstanding restricted stock units as of March 31, 2021.
As of March 31, 2021, we had 1,008,506 shares available for grant pursuant to the 2018 Plan.
Share based compensation for our stock option plans for the three months ended March 31, 2021 and March 31, 2020 were $626 and $438, respectively. We issued 19,709 and 19,317 shares of common stock related to exercises of stock options for the three months ended March 31, 2021 and 2020, respectively. We issued 34,920 and 9,944 shares of common stock related to the issuance of vested restricted stock units for the three months ended March 31, 2021 and 2020, respectively.
NOTE 9 – NET LOSS PER SHARE
We compute net loss per share based on the weighted average number of common shares outstanding for the period.  Diluted net loss per share reflects the maximum dilution that would have resulted from incremental common shares issuable upon the exercise of stock options.  We compute the number of common share equivalents, which includes stock options, using the treasury stock method. We have excluded stock options and restricted stock units of approximately 1,854,000
17

Table of Contents
ASURE SOFTWARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Amounts in thousands, except share and per share data unless otherwise noted)

and 1,264,000 shares for the three months ended March 31, 2021 and 2020, respectively, from the computation of the diluted shares because the effect of including the stock options and restricted stock units would have been anti-dilutive.
The following table sets forth the computation of basic and diluted net loss per common share for the three months ended March 31, 2021 and March 31, 2020:
Three Months Ended March 31,
20212020
Net loss$(1,598)$(1,767)
Weighted-average shares of common stock outstanding, basic and diluted19,007,000 15,727,000 
Basic and diluted loss per share$(0.08)$(0.11)

NOTE 10 – SUBSEQUENT EVENTS
We evaluated subsequent events through the date of the filing of this Quarterly Report on Form 10-Q with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the condensed consolidated financial statements as of March 31, 2021, and events which occurred subsequent to March 31, 2021 but were not recognized in the condensed consolidated financial statements. Based on this evaluation, we have determined there were no subsequent events to report.
18
Table of Contents
ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Form 10-Q contains forward-looking statements about our financial results, which may include expected GAAP and non-GAAP financial and other operating and non-operating results, including revenue, net income, diluted earnings per share, operating cash flow growth, operating margin improvement, deferred revenue growth, expected revenue run rate, expected tax rates, stock-based compensation expenses, amortization of purchased intangibles, amortization of debt discount and shares outstanding. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company's results could differ materially from the results expressed or implied by the forward-looking statements we make. The risks and uncertainties referred to above include -- but are not limited to -- risks associated with possible fluctuations in the company's financial and operating results; the company's rate of growth and anticipated revenue run rate, including impact of the current environment, the spread of major epidemics (including Coronavirus) and other related uncertainties such as government-imposed travel restrictions, interruptions to supply chains and extended shut down of businesses, reductions in employment and an increase in business failures, specifically among our clients, the company's ability to convert deferred revenue and unbilled deferred revenue into revenue and cash flow, and ability to maintain continued growth of deferred revenue and unbilled deferred revenue; foreign currency exchange rates; errors, interruptions or delays in the company's services or the company's Web hosting; breaches of the company's security measures; changes in the forgiveness provisions for loans under the Paycheck Protection Program; domestic and international regulatory developments, including changes to or applicability to our business of privacy and data securities laws, money transmitter laws and anti-money laundering laws; the financial and other impact of any previous and future acquisitions; the nature of the company's business model, including risks related to government contracts; the company's ability to continue to release, gain customer acceptance of and provide support for new and improved versions of the company's services; successful customer deployment and utilization of the company's existing and future services; changes in the company's sales cycle; competition; various financial aspects of the company's subscription model; unexpected increases in attrition or decreases in new business; the company's ability to realize benefits from strategic partnerships and strategic investments; the emerging markets in which the company operates; unique aspects of entering or expanding in international markets, including the compliance with United States export control laws, the company's ability to hire, retain and motivate employees and manage the company's growth; changes in the company's customer base; technological developments; litigation and any related claims, negotiations and settlements, including with respect to intellectual property matters or industry-specific regulations; unanticipated changes in the company's effective tax rate; factors affecting the company's outstanding convertible notes, term loan, and revolving credit facility; fluctuations in the number of company shares outstanding and the price of such shares; collection of receivables; interest rates; factors affecting the company's deferred tax assets and ability to value and utilize them; the potential negative impact of indirect tax exposure; the risks and expenses associated with the company's real estate and office facilities space; and general developments in the economy, financial markets, credit markets and the impact of current and future accounting pronouncements and other financial reporting standards.
Further information on these and other factors that could affect the company's financial results is included in the reports on Forms 10-K, 10-Q and 8-K, and in other filings we make with the Securities and Exchange Commission from time to time. These documents are available on the SEC Filings section of the Investor Information section of the company's website at investor.asuresoftware.com
Asure Software assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
OVERVIEW
The following description of Asure’s financial position as of March 31, 2021 and December 31, 2020, and results of operations for the three months ended March 31, 2021 and 2020 should be read in conjunction with our 2020 Annual Report on Form 10-K filed with the SEC on March 11, 2021. Asure’s internet website address is http://www.asuresoftware.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") are available through the investor relations page of our internet website free of charge as soon as reasonably practicable after they are electronically filed, or furnished to, the SEC. Asure’s internet website and the information contained in our website or connected to our website is not incorporated into this Quarterly Report on Form 10-Q.
We are a leading provider of cloud-based Human Capital Management (HCM) solutions, delivered as software-as-a-service (SaaS) for small and mid-sized businesses (SMBs). From recruitment to retirement, our solutions help more than 80,000
19
Table of Contents
SMBs across the United States grow their businesses. About 10,000 of our clients are direct and the approximately 70,000 remaining are indirect as they have contracts with Reseller Partners that white label our solutions.
We strive to be the most trusted HCM resource to entrepreneurs and are focused on less densely populated U.S. metropolitan cities where fewer of our competitors have a presence. Our solution strategy solves three primary challenges that prevent businesses from growing: HR complexity, allocation of human and financial capital, and the ability to build great teams. We have invested in, and we intend to continue to invest in, research and development to expand our solutions. Asure HCM, our user-friendly solution, reduces the administrative burden on employers and increases employee productivity while managing the complete employment lifecycle.
Impact of the COVID-19 Pandemic to be updated
On March 11, 2020, the World Health Organization declared the COVID-19 outbreak to be a global pandemic. In response, federal, state and local governments imposed various restrictions on social and commercial activity to promote social distancing in an effort to slow the spread of the disease, and many such restrictions remain in place. Beginning in February 2020, we took various actions in order to minimize the risk of COVID-19 to our employees, our clients, and the communities in which we operate, and in March 2020, we prohibited all business-related travel until further notice and began transitioning our employees to work-from-home arrangements. As of March 31, 2021, more than 70% of our employees were working remotely. We will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state or local authorities or that we determine are in the best interests of our employees and clients.
In addition, the COVID-19 pandemic has disrupted the operations of our clients and client prospects and may continue to do so for an indefinite period of time. Across many industries, temporary and permanent business closures as well as business occupancy limitations have resulted in significant layoffs and employee furloughs since late March 2020. Because we charge our clients on a per-employee basis for certain services we provide, decreases in the headcounts of our clients as of the onset of the pandemic negatively impacted our recurring revenue during 2020, and we expect that our recurring revenue in future periods will continue to be negatively impacted by such headcount reductions until employment levels among such client base return to pre-pandemic levels. Further, at the onset of the COVID-19 pandemic, a limited number of new clients temporarily delayed service implementation. As the COVID-19 pandemic continues to create uncertainty and the potential for ongoing business disruptions, we may experience similar client-driven delays in service implementation in the future.
In 2020, we continued to aggressively invest in sales and marketing and in research and development to drive future growth and expand our market share. Lower headcount at our clients and the other pandemic-related factors described above, which had and may continue to have, a negative impact on recurring revenue, combined with increased sales and marketing and research and development expenses, resulted in a decrease in net income for the year ended December 31, 2020 as compared to the year ended December 31, 2019. We expect net income to be negatively affected by the impact of the pandemic on our recurring revenue and our deliberate, increased level of investment in sales and marketing and research and development to drive the growth of our business.
Prior to the COVID-19 pandemic, our sales force historically traveled frequently to market our solution set. The current remote work environment presents a unique opportunity for our sales force because each sales employee is able to meet virtually with a greater number of client prospects in a given day than he or she would if conducting in-person meetings. Although we have not experienced such challenges to date, if clients and client prospects are not as willing or available to engage by video conference and teleconference, the shift from in-person to virtual sales meetings could negatively affect our sales efforts, impede client acquisition and lengthen our sales cycles, which would negatively impact our business and results of operations and could impact our financial condition in the future.
We are unable to estimate the full impact that the COVID-19 pandemic could have on our business and results of operations in the future due to numerous uncertainties, including the severity of the disease, the duration of the outbreak, actions that may be taken by governmental authorities, the impact it may have on the business of our clients and other factors identified in Part I, Item 1A “Risk Factors” in our Form 10-K. As a result, the effect of the ongoing COVID-19 pandemic may not be fully reflected in our results of operations and overall financial performance until future periods.

20
Table of Contents
RESULTS OF OPERATIONS
($ in thousands)
Three Months Ended March 31, 2021 Compared to Three Months Ended March 31, 2020
The following table sets forth, for the fiscal periods indicated, the percentage of total revenues represented by certain items in Asure's Condensed Consolidated Statements of Comprehensive Loss:
 Three Months Ended March 31,
 20212020
Revenues100 %100