Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
In connection with the preparation of this Annual Report, as of January 31, 2022, an evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of January 31, 2022, our disclosure controls and procedures were, in design and operation, not effective at a reasonable assurance level as a result of the material weakness described below.
Management’s Report on Internal Control over Financial Reporting
This Annual Report 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 due to a transition period established by the rules of the SEC for newly public companies.
Material Weakness
As disclosed in our Quarterly Report on the Form 10-Q for the quarter ended October 31, 2021, we previously identified a material weakness in our internal control over financial reporting.
We have not properly designed internal controls over the preparation of our consolidated financial statements insofar as it relates to appropriately performing effective and timely review of the accounting for and disclosure of non-routine transactions. Therefore, there was a risk that a potential material misstatement of the consolidated financial statements could occur without being prevented or detected on a timely basis.
Notwithstanding such material weakness in internal control over financial reporting, our Chief Executive Officer and Chief Financial Officer have concluded that our audited consolidated financial statements included in this Annual Report present fairly, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP. This material weakness also did not result in a material misstatement in any previously issued consolidated financial statements.
Remediation Efforts and Status
We are currently in the process of remediating our material weakness and are taking the steps that we believe will address the underlying causes of the material weakness, including:
• We have enhanced the review processes around non-standard contracts.
• We have expanded our internal disclosure review processes to provide greater representation across various functions to ensure complete and timely identification of non-routine transactions.
• We have expanded accounting policies, procedures and processes related to our financial reporting.
• We have and will continue to implement additional training of finance, accounting and other Company personnel involved in the financial reporting process.
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The material weakness will not be considered fully remediated until all aspects of the controls operate for a sufficient period of time to allow management to conclude that these controls are operating effectively. We will monitor the effectiveness of our remediation plan and steps and will refine the remediation plan as appropriate.
We believe the actions described above will be sufficient to remediate the identified material weakness and strengthen our internal control over financial reporting. However, our efforts to remediate this material weakness may not be effective or prevent any future material weakness or significant deficiency in our internal control over financial reporting.
Changes in Internal Control over Financial Reporting
Other than the material weakness and remediation efforts described above, there were no changes to our internal control over financial reporting identified in connection with the evaluation required by rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended January 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations on Effectiveness of Controls and Procedures
Our disclosure controls and procedures and internal controls over financials reporting are designed to provide reasonable assurance of achieving their desired objectives. Management does not expect, however, that our disclosure controls and procedures or our internal controls over financial reporting will prevent or detect all errors and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the company have been detected.
ITEM 9B. OTHER INFORMATION
None.
ITEM 9C. DISCLOSURES REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by this item will be set forth in our definitive proxy statement to be filed with the Securities and Exchange Commission not later than 120 days after the end of our fiscal year ended January 31, 2022 in connection with our 2022 annual meeting of shareholders, or the Proxy Statement, and is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNER AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required by this item will be set forth in the 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 set forth in the Proxy Statement and is incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference.
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PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES
(1) All Financial Statements
See Index to Consolidated Financial Statements in Item 8 herein.
(2) Financial Statements Schedules
The following additional financial statement schedules should be considered in conjunction with our consolidated financial statements. All other financial statement schedules have been omitted because the required information is not present in amounts sufficient to require submission of the schedule, not applicable, or because the required information is included in the consolidated financial statements or notes thereto.
Schedule II: Valuation and Qualifying Accounts
The table below details the activity of the deferred tax valuation allowance for the fiscal years ended January 31, 2022, 2021, and 2020:
Balance at Beginning of Year Additions Write-offs or Deductions Balance at End of Year
(in thousands)
Year ended January 31, 2022
Deferred tax valuation allowance $ 74,870 $ 40,969 $ — $ 115,839
Year ended January 31, 2021
Deferred tax valuation allowance $ 37,847 $ 37,023 $ — $ 74,870
Year ended January 31, 2020
Deferred tax valuation allowance $ 14,058 $ 23,789 $ — $ 37,847
(3) Exhibits
Incorporated by Reference Filed or Furnished Herewith
Exhibit Number Description Form File Number Exhibit Filing Date
3.1 Restated Certificate of Incorporation 2021 of GitLab Inc.
10-Q 001-40895 3.2 12/7/21
3.2 Restated Bylaws of GitLab Inc.
10-Q 001-40895 3.3 12/7/21
4.1 Form of Class A Common Stock Certificate of GitLab Inc.
S-1/A 333-259602 4.1 10/12/21
4.2 Amended and Restated Investors’ Rights Agreement among GitLab Inc. and certain holders of its capital stock, dated September 10, 2019.
S-1 333-259602 4.2 10/12/21
4.3 Form of Class B Common Stock Warrant.
S-1/A 332-259602 4.3 10/4/21
4.4 Description of Registrant’s Securities
X
10.1† Form of Indemnification Agreement between GitLab Inc. and each of its directors and executive officers.
S-1 333-259602 10.1 9/17/21
10.2† GitLab Inc. 2015 Equity Incentive Plan and related form agreements.
S-1 333-259602 10.2 9/17/21
10.3† GitLab Inc. 2021 Equity Incentive Plan and related form agreements.
S-1 333-259602 10.3 10/4/21
10.4† GitLab Inc. 2021 Employee Stock Purchase Plan
S-1 333-259602 10.4 9/17/21
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10.5† Form of Offer Letter between GitLab Inc. and each of its named executive officers.
S-1/A 333-259602 10.5 10/4/21
21.1 List of Subsidiaries of GitLab Inc.
X
23.1 Consent of KPMG LLP, independent registered public accounting firm.
X
24.1 Power of Attorney. Reference is made to the signature page hereto.
X
31.1 Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
X
31.2 Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
X
32.1* Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
X
32.2* Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
X
101.INS 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
101.SCH Inline XBRL Taxonomy Extension Schema Document. X
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. X
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. X
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. X
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. X
104 Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101). X
† Indicates management contract or compensatory plan.
* The certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Annual R eport on Form 10-K an d are not deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall they be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, irrespective of any general incorporation language contained in such filing.
ITEM 16. FORM 10-K SUMMARY
None.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the re gistrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
GITLAB INC.
Date: April 8, 2022
By: /s/ Sytse Sijbrandij
Name: Sytse Sijbrandij
Title: Chief Executive Officer
Date: April 8, 2022
By: /s/ Brian Robins
Name: Brian Robins
Title: Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Brian Robins and Robin Schulman, and each or any one of them, 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 an d all capacities, to sign any and all amendments to this report, 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-facts 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 or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.
Name Title Date
/s/ Sytse Sijbrandij Director and Chief Executive Officer April 8, 2022
Sytse Sijbrandij (principal executive officer)
/s/ Brian Robins Chief Financial Officer April 8, 2022
Brian Robins (principal financial officer)
/s/ Dale Brown Principal Accounting Officer April 8, 2022
Dale Brown (principal accounting officer)
/s/ Sundeep Bedi Director April 8, 2022
Sundeep Bedi
/s/ Karen Blasing Director April 8, 2022
Karen Blasing
/s/ Sue Bostrom Director April 8, 2022
Sue Bostrom
/s/ Matthew Jacobson Director April 8, 2022
Matthew Jacobson
/s/ Merline Saintil Director April 8, 2022
Merline Saintil
/s/ Godfrey Sullivan Director April 8, 2022
Godfrey Sullivan
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