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Item 9A. Controls and Procedures

2024-02-29 compared with 2023-03-07 · 62 added, 21 removed, 191 unchanged (30% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our periodic and current reports that we file with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports that we file or submit to the SEC under the Securities Exchange Act of 1934, as amended (“Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives.

In reaching a reasonable level of assurance, management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions;

1 unchanged sentence

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, have evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Annual Report on Form 10-K.

Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of December 31, 2022, our disclosure controls and procedures are, in design and operation, effective at the reasonable assurance level.

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Annual Report on Form 10-K.

Based on this evaluation and in reference only to the matter described below, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of December 31, 2023, our disclosure controls and procedures are not effective at a reasonable assurance level due to a material weakness in internal control over financial reporting.

Our management has performed additional analyses, reconciliations, and other post-closing procedures as well as assessed all key non-IT related internal control over financial reporting noting no deficiencies were identified;

and therefore, we have concluded that, notwithstanding the matter described below, the consolidated financial statements are fairly presented, in all material respects.

Management, including our Chief Executive Officer and Chief Financial Officer, believe that the consolidated financial statements contained in this Form 10-K fairly present, in all material respects, the financial condition, results of operations and cash flows for all periods presented in accordance with U.S.

Generally Accepted Accounting Principles.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act).

Management conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2022 based on the criteria set forth in “Internal Control-Integrated Framework” (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on this assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2022 based on those criteria.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm due to our EGC status and is exempted from the auditor attestation requirement of Section 404(b) of the Sarbanes-Oxley Act.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act).

Management conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2023 based on the criteria set forth in Internal Control - Integrated Framework ( “ 2013 Framework ” ) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and concluded that our internal control over financial reporting was not effective as of December 31, 2023 as a result of the material weakness described below.

In connection with our assessment of the effectiveness of internal control over financial reporting, management identified certain control deficiencies in the area of our Information Technology General Control (“ITGC”) related to (i) user access and segregation of duty controls that restrict user and privileged access to appropriate personnel;

(ii) program change management controls;

and (iii) certain computer operations controls that, when aggregated, arise to a material weakness.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial

reporting, such that there is a reasonable possibility that a material misstatement of a company ’ s annual or interim financial statements will not be prevented or detected on a timely basis.

This material weakness did not result in any material misstatements in our consolidated financial statements or disclosures in any of the fiscal years ended December 31, 2023, 2022 or 2021.

However, a material weakness could result in misstatements potentially impacting our account balances or disclosures that would result in a material misstatement to the annual or interim financial statements that would not be prevented or detected.

The effectiveness of our internal control over financial reporting as of December 31, 2023, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included in Item 8 of this Annual Report on Form 10-K.

Remediation Plans for the Material Weakness

Management is committed to remediating the material weakness in a timely manner.

Our remediation process includes, but is not limited to:

(i) increasing timely reviews of IT system changes made;

(ii) rationalizing access privileges for developer system users;

(iii) implementing or modifying controls related to program change management and certain computer operations;

and (iv) training of relevant personnel on the design and operation of any new or modified ITGCs.

These steps are subject to ongoing management review, as well as oversight by the audit committee of our board of directors.

Additional or modified measures may also be required to remediate the material weakness.

We will not be able to conclude that we have completely remediated the material weakness until the applicable controls are fully implemented and have operated for a sufficient period of time and management has concluded, through formal testing, that the remediated controls are operating effectively.

We will continue to monitor the design and effectiveness of these and other processes, procedures, and controls and make any further changes management deems appropriate.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the fiscal quarter ended December 31, 2023 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Disclosure Controls and Procedures

It should be noted that any system of controls, however well designed and operated, can provide only reasonable assurance, and not absolute assurance, that the objectives of the system are met.

In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events.

Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals in all future circumstances.

Other Information

(b) Trading Arrangements

During the quarter ended December 31, 2023, our directors and officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated the contracts, instructions or written plans for the purchase or sale of Arlo's securities set forth in the table below:

Type of Trading Arrangement

Name and Position Action

Rule 10b5-1 (1)

Non-Rule 10b5-1 (2)

Total Shares to be Sold Expiration Date

Matthew McRae ,

Chief Executive Officer

November 30, 2023 (3)

X 525,594 March 7, 2025

Kurtis Binder ,

Chief Financial Officer

Adoption November 29, 2023 (3)

X 131,213 December 13, 2024

Brian Busse ,

General Counsel

Adoption November 16, 2023 (3)

X 99,134 November 15, 2024

_________________________

(1) Contract, instruction or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act.

(2) “Non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K under the Exchange Act.

(3) Adopted for personal tax planning purposes.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

148 unchanged sentences

Section 1350 Certification of Principal Financial Officer

Arlo Technologies, Inc.

Clawback Policy

101.INS Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document X

18 unchanged sentences

(Principal Financial and Accounting Officer)

March 7, 2023

February 29, 2024

POWER OF ATTORNEY

2 unchanged sentences

Signature Title Date

/s/ MATTHEW MCRAE Chief Executive Officer March 7, 2023

/s/ MATTHEW MCRAE Chief Executive Officer February 29, 2024

Matthew McRae (Principal Executive Officer)

/s/ KURTIS BINDER Chief Financial Officer March 7, 2023

/s/ KURTIS BINDER Chief Financial Officer February 29, 2024

Kurtis Binder (Principal Financial and Accounting Officer)

/s/ PRASHANT AGGARWAL Director March 7, 2023

/s/ PRASHANT AGGARWAL Director February 29, 2024

Prashant Aggarwal

/s/ JOCELYN E.

CARTER-MILLER Director March 7, 2023

CARTER-MILLER Director February 29, 2024

Carter-Miller

FAISON Director March 7, 2023

/s/ CATRIONA FALLON Director March 7, 2023

FAISON Director February 29, 2024

/s/ CATRIONA FALLON Director February 29, 2024

Catriona Fallon

/s/ AMY ROTHSTEIN Director March 7, 2023

/s/ AMY ROTHSTEIN Director February 29, 2024

Amy Rothstein

SUMMERS Director March 7, 2023

SUMMERS Director February 29, 2024

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures