Braze, Inc. 10-K

Item 9A. Controls and Procedures Management’s Report on Internal Control Over Financial Reporting This Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) due to a transition period established by rules of the SEC for newly public companies. Evaluation of Disclosure Controls and Procedures We maintain “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), that are designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of January 31, 2022, the end of the period covered by this Annual Report on Form 10-K. Our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of January 31, 2022 because of the three material weaknesses in our internal control, discussed below. Notwithstanding the material weakness in internal control over financial reporting described below, our management has concluded that our consolidated financial statements included in this Annual Report on Form 10-K are fairly stated in all material respects in accordance with accounting principles generally accepted in the United States of America. 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. As previously identified and disclosed in our final IPO prospectus dated November 16, 2021, we have three material weaknesses in our internal control that remain unremediated as of January 31, 2022. One material weakness is over the financial reporting close process specifically related to insufficient written policies and procedures for accounting and financial reporting and related controls, the second over the lack of properly designed controls related to accounting for revenue recognition in accordance with standards under Accounting Standards Codification Topic 606, Revenue from Contracts with Customers and the third related to our inadequate information technology controls for systems that are relevant to the preparation of financial statements. These control deficiencies could result in a misstatement of our accounts or disclosures that could result in a material misstatement of our financial results that would not be prevented or detected, and accordingly, we determined that these control deficiencies constitute a material weakness. Remediation Plan We have developed a detailed plan for remediation of the material weakness, as well as compliance with Section 404 of the Sarbanes-Oxley Act, including developing and maintaining appropriate IT general controls and process level controls. While we have performed certain remediation activities to strengthen our controls to address the identified material weakness, control weaknesses are not considered remediated until new internal controls have been operational for a period of time, are tested, and management concludes that these controls are operating effectively. We will continue to monitor the effectiveness of our remediation measures in connection with our future assessments of the effectiveness of internal control over financial reporting and disclosure controls and procedures, and we will make any changes to the design of our plan and take such other actions that we deem appropriate given the circumstances. Changes in Internal Control Over Financial Reporting 96 Table of Contents There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the fiscal years ended January 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. We are continuing to take steps to remediate the material weakness in our internal control over financial reporting, as discussed above. Inherent Limitation on the Effectiveness of Internal Controls Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, and not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our Company have been detected. Item 9B. Other Information None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 97 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance The information required by this item will be included in our Definitive Proxy Statement for our 2022 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended January 31, 2022, or the 2022 Proxy Statement, and is incorporated herein by reference. Code of Conduct We have adopted a Code of Conduct that applies to all our employees, officers and directors. This includes our principal executive officer, principal financial officer and principal accounting officer or controller, or persons performing similar functions. The full text of our Code of Conduct is posted on our website at www.braze.com. We intend to disclose on our website any future amendments of our Code of Conduct or waivers that exempt any principal executive officer, principal financial officer, principal accounting officer or controller, persons performing similar functions or our directors from provisions in the Code of Conduct. Information contained on, or that can be accessed through, our website is not incorporated by reference into this report, and you should not consider information on our website to be part of this report on Annual Report on Form 10-K. Item 11. Executive Compensation The information required by this item will be included in the 2022 Proxy Statement and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required by this item will be included in the 2022 Proxy Statement and is incorporated herein by reference. Securities Authorized for Issuance under Equity Compensation Plan The information required by this item will be included in the 2022 Proxy Statement and is incorporated herein by reference. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required by this item will be included in the 2022 Proxy Statement and is incorporated herein by reference. Item 14. Principal Accounting Fees and Services The information required by this item will be included in the 2022 Proxy Statement and is incorporated herein by reference. With the exception of the information incorporated in Items 10, 11, 12, 13, and 14 of this Annual Report on Form 10-K, the 2022 Proxy Statement is not deemed “filed” as part of this Annual Report on Form 10-K. 98 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules Documents filed as part of this report are as follows: 1. Consolidated Financial Statements: Our Consolidated Financial Statements are listed in the “Index to Consolidated Financial Statements” under Part II, Item 8 of this Annual Report on Form 10-K. 2. Financial Statement Schedules: Financial Statement Schedules have been omitted as information required is inapplicable or the information is presented in the consolidated financial statements and the related notes. 3. Exhibits: The documents listed in the accompanying index to exhibits are filed or incorporated by reference as part of this Annual Report on Form 10-K. Exhibit Index Incorporated by Reference Exhibit Number Description Form File No. Exhibit Filing Date 3.1 Amended and Restated Certificate of Incorporation of Braze, Inc. 8-K 001-41065 3.1 November 23, 2021 3.2 Amended and Restated Bylaws of Braze, Inc. 8-K 001-41065 3.2 November 23, 2021 4.1 Form of Class A Common Stock Certificate . S-1/A 333-260428 4.1 November 8, 2021 4.2* Description of Registrant’s Securities. 10.1 Fourth Amended and Restated Investors’ Rights Agreement, dated as of September 24, 2018. S-1 333-260428 10.1 October 22, 2021 10.2+ Amended and Restated 2011 Equity Incentive Plan and forms of agreements thereunder. S-1 333-260428 10.2 October 22, 2021 10.3+ 2021 Equity Incentive Plan and forms of agreements thereunder . S-1/A 333-260428 10.3 November 8, 2021 10.4+ 2021 Employee Stock Purchase Plan . S-1/A 333-260428 10.4 November 8, 2021 10.5+ Form of Indemnification Agreement entered into by and between Registrant and each director and executive officer. S-1/A 333-260428 10.5 November 8, 2021 10.6+ Confirmatory Offer Letter, by and between Braze, Inc. and William Magnuson, dated November 2, 2021. S-1/A 333-260428 10.6 November 8, 2021 10.7+ Confirmatory Offer Letter, by and between Braze, Inc. and Isabelle Winkles, dated November 2, 2021. S-1/A 333-260428 10.7 November 8, 2021 10.8+ Confirmatory Offer Letter, by and between Braze, Inc. and Susan Wiseman, dated November 2, 2021. S-1/A 333-260428 10.8 November 8, 2021 10.9+ Confirmatory Offer Letter, by and between Braze, Inc. and Jonathan Hyman, dated November 2, 2021. S-1/A 333-260428 10.9 November 8, 2021 99 Table of Contents 10.10+ Confirmatory Offer Letter, by and between Braze, Inc. and Myles Kleeger, dated November 2, 2021. S-1/A 333-260428 10.1 November 8, 2021 10.11+ Executive Severance Plan. S-1/A 333-260428 10.11 November 8, 2021 10.12+ Non-Employee Director Compensation Policy. S-1/A 333-260428 10.12 November 8, 2021 10.13 Sub-sublease Agreement by and between Braze, Inc. and ContextMedia Health, LLC, dated December 20, 2018. S-1 333-260428 10.13 October 22, 2021 10.14 Sublease by and between Braze, Inc. and Web.com Group, Inc., dated June 30, 2019. S-1 333-260428 10.14 October 22, 2021 21.1 List of Subsidiaries of the Company. S-1 333-260428 21.1 October 22, 2021 23.1* Consent of Ernst & Young LLP, independent registered public accounting firm. 24.1* Power of Attorney (included in signature pages hereto). 31.1* Certification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification of Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1*† Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.INS* Inline XBRL Instance Document 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) * Filed herewith. + Indicates management contract or compensatory plan. † The certifications attached as Exhibit 32.1 that accompany this Annual Report on Form 10-K are deemed furnished and not filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of Braze, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing. Item 16. Form 10-K Summary None. 100 Table of Contents SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized, on March 31, 2022 . BRAZE, INC. By: /s/ William Magnuson Name: William Magnuson Title: Chief Executive Officer POWER OF ATTORNEY Each person whose signature appears below constitutes and appoints William Magnuson, Isabelle Winkles and Susan Wiseman, and each of them, as his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitutes, may lawfully do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated: Signature Title Date /s/ William Magnuson Chief Executive Officer and Director (Principal Executive Officer) March 31, 2022 William Magnuson /s/ Isabelle Winkles Chief Financial Officer (Principal Financial Officer) March 31, 2022 Isabelle Winkles /s/ Pankaj Malik Chief Accounting Officer (Principal Accounting Officer) March 31, 2022 Pankaj Malik /s/ Neeraj Argawal Director March 31, 2022 Neeraj Argawal /s/ Phillip M. Fernandez Director March 31, 2022 Phillip M. Fernandez /s/ Matthew Jacobson Director March 31, 2022 Matthew Jacobson /s/ Tara Levy Director March 31, 2022 Tara Levy /s/ David Obstler Director March 31, 2022 David Obstler 101 Table of Contents /s/ Doug Pepper Director March 31, 2022 Doug Pepper 102