Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2023. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2023, our disclosure controls and procedures were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
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 Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the U.S. Our management, under the oversight of our board of directors, evaluated the effectiveness of our internal control over financial reporting as of December 31, 2023 based on the framework in Internal Control-Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission.
In accordance with guidance issued by the Securities and Exchange Commission, companies are permitted to exclude acquisitions from their assessment of internal control over financial reporting for the first fiscal year in which the acquisition occurred. Our management’s evaluation of internal control over financial reporting excluded the internal control activities of Robinhood Credit, Inc., formerly known as X1, Inc., which we acquired on July 3, 2023, as discussed in Note 3 - Business Combinations, to our consolidated financial statements in this Annual Report. We have included the financial results of this acquisition in the consolidated financial statements from the date of acquisition. Total net revenues and total assets subject to Robinhood Credit, Inc.’s internal control over financial reporting represented less than one percent of both our consolidated total net revenues and total assets for the fiscal year ended and as of December 31, 2023.
Based on this evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2023.
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Our independent registered public accounting firm, Ernst & Young LLP, who audited the Consolidated Financial Statements included in this Annual Report on Form 10-K, issued an audit report on the Company's internal control over financial reporting. That Report of Independent Registered Public Accounting Firm is included in Item 8 of this Annual Report on Form 10-K.
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and are effective at the reasonable assurance level. However, management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. 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 the company have been detected. 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. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud might occur without being detected.
ITEM 9B. OTHER INFORMATION
(b) During the three months ended December 31, 2023, no director or “officer” of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.
In addition, certain of our officers may, from time to time, make elections to participate in our ESPP and to have shares withheld to cover withholding taxes or pay the exercise price of options, which may be designed to satisfy the affirmative defense conditions of Rule 10b5-1 under the Exchange Act or may constitute “non-Rule 10b5-1 trading arrangements” (as defined in Item 408(c) of Regulation S-K).
ITEM 9C. DISCLOSURE 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 is incorporated by reference to our Proxy Statement for the 2024 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2023.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is incorporated by reference to our Proxy Statement for the 2024 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2023.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required by this item is incorporated by reference to our Proxy Statement for the 2024 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2023.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this item is incorporated by reference to our Proxy Statement for the 2024 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2023.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The information required by this item is incorporated by reference to our Proxy Statement for the 2024 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2023.
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PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) The following documents are filed as part of this Annual Report:
1. The following consolidated financial statements of Robinhood Markets Inc. and subsidiaries are filed as part of this Annual Report under Part II, Item 8:
• Reports of Independent Registered Public Accounting Firm on Consolidated Financial Statements
• Consolidated Balance Sheets as of December 31, 2023 and 2022
• Consolidated Statements of Income for the Years Ended December 31, 2023, 2022 and 2021
• Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2023, 2022, and 2021
• Consolidated Statements of Cash Flows for the Years Ended December 31, 2023, 2022 and 2021
• Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2023, 2022 and 2021
• Notes to Consolidated Financial Statements
2. Financial Statement Schedules:
All schedules are omitted because of the absence of conditions under which they are required or because information called for is shown in the consolidated financial statements and notes thereto in Part II, Item 8 of this Annual Report.
3. Exhibits:
The information required by this Item is set forth in the Exhibit Index that precedes the signature page of this Annual Report.
ITEM 16. FORM 10-K SUMMARY
None.
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EXHIBIT INDEX
The documents listed below are filed (or furnished, as noted) as exhibits to this Annual Report on Form 10-K:
Incorporated by Reference
Exhibit Number Description Form* Filing Date Exhibit Filed Herewith
3.1 Amended and Restated Certificate of Incorporation of Robinhood Markets, Inc., dated August 2, 2021 (our “Charter”)
8-K 2021-08-02 3.1
3.2 Amended and Restated Bylaws of Robinhood Markets, Inc., dated December 14, 2022 (our “Bylaws”)
8-K 2022-12-16 3.1
4.1 Form of Class A Common Stock Certificate of Robinhood Markets, Inc.
S-1/A 2021-07-19 4.1
4.2 Form of ten-year Warrant to Purchase Stock of Robinhood Markets, Inc., issued to multiple investors on February 12, 2021
S-1 2021-07-01 4.2
4.3 Description of Robinhood Securities Registered Under Section 12 of the Exchange Act
10-K 2022-02-24 4.3
10.1(a) Form of Indemnification Agreement between Robinhood Markets, Inc. and, separately, each of its directors and executive officers (other than VC Fund Affiliated Directors)
S-1/A 2021-07-19 10.1
10.1(b) Form of Indemnification Agreement (VC Fund-Affiliated Directors)
10-Q 2022-05-06 10.1
10.2 Form of Indemnification Agreement between Robinhood Markets, Inc. and, separately, each of Jan Hammer and Scott Sandell
S-1/A 2021-07-19 10.2
10.3† Underwriting Agreement, dated July 28, 2021, between Robinhood Markets, Inc., as the issuer, and Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC, as representatives of the several underwriters named therein
10-Q 2021-08-18 10.3
10.4† Credit Agreement, dated as of April 16, 2021, by and among Robinhood Securities, LLC, the lenders thereto, JPMorgan Chase Bank N.A. as administrative agent, joint bookrunner and joint lead arranger, BMO Harris Bank N.A., as syndication agent, and BMO Capital Markets Corp. as joint bookrunner and joint lead arranger
S-1 2021-07-01 10.14
10.5+ Offer Letter between Robinhood Markets, Inc. and Jason Warnick, dated November 8, 2018
S-1 2021-07-01 10.6
10.6†+ Offer Letter between Robinhood Markets, Inc. and Daniel Gallagher, as amended and restated on December 15, 2020
S-1 2021-07-01 10.7
10.7†+ Offer Letter between Robinhood Markets, Inc. and Paula Loop, dated May 14, 2021
S-1 2021-07-01 10.8
10.8†+ Offer Letter between Robinhood Markets, Inc. and Jonathan Rubinstein, dated May 14, 2021
S-1 2021-07-01 10.9
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10.9†+ Offer Letter between Robinhood Markets, Inc. and Robert Zoellick, dated May 14, 2021
S-1 2021-07-01 10.10
10.10 Exchange Agreement, dated July 26, 2021 between Robinhood Markets, Inc. Baiju Bhatt, Vladimir Tenev, and certain of his related entities
10-Q 2021-08-18 10.8
10.11 Form of Equity Exchange Right Agreement, entered into on July 26, 2021 between Robinhood Markets, Inc. and, separately, (a) Baiju Bhatt and (b) Vladimir Tenev
S-1/A 2021-07-19 10.13
10.12(a) Voting Agreement, dated July 26, 2021, among Robinhood Markets, Inc., Baiju Bhatt, Vladimir Tenev, and certain related entities
10-Q 2021-08-18 10.10
10.12(b) Joinder Agreement, dated December 13, 2021 by Bhatt Family LLC, becoming party to the Voting Agreement, dated July 26, 2021, among Robinhood Markets. Inc., Baiju Bhatt, Vladimir Tenev, and certain related entities
10-Q 2022-05-06 10.2
10.13(a)†+ Robinhood Markets, Inc. 2020 Equity Incentive Plan, as amended on June 18, 2020 and form grant notices and award agreements thereunder
S-1 2021-07-01 10.2
10.13(b)+ Second Amendment to the Robinhood Markets, Inc. 2020 Equity Incentive Plan, dated March 10, 2021
S-1 2021-07-01 10.4
10.13(c)+ Third Amendment to the Robinhood Markets, Inc. 2020 Equity Incentive Plan, dated May 26, 2021
S-1 2021-07-01 10.5
10.13(d)+ Form of 2021 Market-Based RSU Award, dated May 26, 2021, between Robinhood Markets, Inc. and, separately (a) Baiju Bhatt and (b) Vladimir Tenev
S-1 2021-07-01 10.17
10.13(e)+ Form of RSU Agreement for Non-Employee Directors (including the Notice of Grant) under the 2020 Plan
S-1 2021-07-01 10.18
10.14(a)†+ Robinhood Markets, Inc. Amended and Restated 2013 Stock Plan and form grant notices and award agreements thereunder
S-1 2021-07-01 10.3
10.14(b)+ Form of Notice of Time-Based Restricted Stock Unit Award and Restricted Stock Unit Agreement under the Robinhood Markets, Inc. Amended and Restated 2013 Stock Plan for Vladimir Tenev and Baiju Bhatt
S-1 2021-07-01 10.15
10.14(c)+ Form of 2019 Market-Based RSU Award, as amended and restated on May 26, 2021, between Robinhood Markets, Inc. and, separately (a) Baiju Bhatt and (b) Vladimir Tenev
S-1 2021-07-01 10.16
10.15(a)+
Robinhood Markets, Inc. 2021 Omnibus Incentive Plan (the “2021 Plan”)
S-8 2021-07-29 99.1
10.15(b)+
Form of Restricted Stock Unit Agreement for Employees and Non-Employee Directors (including the Notices of Grant) under the 2021 Plan
10-Q 2021-08-18 10.16
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10.15(c)+
Form of Fully Vested Stock Award Agreement for Non-Employee Directors (including the Notice of Grant) under the 2021 Plan
10-Q 2021-08-18 10.17
10.15(d) +
Form of Option Agreement for Employees and Non-Employee Directors (including the Notices of Grant) under the 2021 Plan
10-K 2022-02-24 10.15(d)
10.16(a)+
Robinhood Markets, Inc. 2021 Employee Share Purchase Plan (the “ESPP”)
S-8 2021-07-29 99.2
10.16(b)+
Forms of ESPP Subscription Agreement and Notice of Withdrawal
10-Q 2021-08-18 10.19
10.17+ Robinhood Markets, Inc. Change in Control and Severance Plan for Key Employees
S-1/A 2021-07-19 10.22
10.18(a)+
Offer Letter between Robinhood Markets, Inc. and Gretchen Howard, dated November 16, 2018
10-Q 2022-05-06 10.3
10.18(b)+
L etter Agreement, dated March 15, 2023, between Gretchen Howard and Robinhood Markets, Inc.
8-K
2023-03-15 10.1
10.19(a)+
Offer Letter between Robinhood Markets, Inc. and Aparna Chennapragada, dated February 18, 2021
10-Q 2022-05-06 10.4
10.19(b)+ Separation Agreement between Robinhood Markets, Inc. and Aparna Chennapragada, dated August 1, 2022
10-Q 2022-11-03 10.1
10.20(a)+
Offer Letter between Robinhood Markets, Inc. and Christina Smedley, dated July 4, 2020
10-Q 2022-05-06 10.5.1
10.20(b)+
Separation Agreement between Robinhood Markets., Inc. and Christina Smedley, dated August 21, 2021
10-Q 2022-05-06 10.5.2
10.21+
Form of Stock Option Agreement for Employees and Non-Employee Directors (including Notices of Grant) under the Robinhood Markets, Inc. 2021 Omnibus Incentive Plan
10-Q 2022-05-06 10.6
10.22 Amended and Restated Credit Agreement, dated as of April 11, 2022, among Robinhood Securities, LLC, as borrower, the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent
8-K 2022-04-14 10.1
10.23+
F orm of Restricted Stock Unit Cancellation Agreement , date d Feb ruary 3, 2023 between Robinh ood Mar kets, Inc. and separately, (a) Vla dimir Tenev and (b) Baiju Bhatt
8-K 2023-02-08 10.1
10.24 Second Amended and Restated Credit Agreement dated as of March 24, 20 23, among Rob inhood Securities LLC,as borrower, the lenders party thereto, and JPM organ Chase B ank, N .A. , as administrative agent
8-K 2023-03-24 10.1
10.25 Share Purchase Agreement, date d as of August 30, 2023, by Robinhood Markets, Inc, as purchaser , and the United States Marshals Service, for and on behalf of the United S tates
8-K 2023-09-01 10.1
21.1 Subsidiaries of Robinhood Markets, Inc.
X
23.1 Consent of Independent Regist e red Public Accoun ting Firm
X
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24.1 Power of Attorney (included in signature pages hereto)
X
31.1 CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act
X
31.2 CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act
X
32.1‡ CEO Certification pursuant to Section 906 of the Sarbanes-Oxley Act
X
32.2‡ CFO Certification pursuant to Section 906 of the Sarbanes-Oxley Act
X
97.1 R obinhood Markets, Inc. Incentive-based Compensation Recovery Policy, Effective October 2, 2023
X
101.INS iXBRL (Inline eXtensible Business Reporting Language) 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 iXBRL Taxonomy Extension Schema Document X
101.CAL iXBRL Taxonomy Extension Calculation Linkbase Document X
101.DEF iXBRL Taxonomy Extension Definition Linkbase Document X
101.LAB iXBRL Taxonomy Extension Label Linkbase Document. X
101.PRE iXBRL Taxonomy Extension Presentation Linkbase Document. X
104 Cover Page Interactive Data File (contained in Exhibit 101) X
_______________
* File number is 001-40691 except that the S-1 (and S-1/A) file number is 333-257602 and the S-8 file number is 333-258250.
+ Indicates a management contract or compensatory plan.
† Certain schedules and exhibits have been omitted pursuant to Rule 601(a)(5) of Regulation S-K under the Securities Act. A copy of any omitted schedule or exhibit will be furnished to the SEC upon request.
‡ The certifications attached as Exhibits 32.1 and 32.2 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 Robinhood Markets, Inc. under the Securities Act or the Exchange Act, 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.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in Menlo Park, California, on February 27, 2024.
Robinhood Markets, Inc.
By: /s/ Vladimir Tenev
Name: Vladimir Tenev
Title: Co-Founder, Chief Executive Officer and President
By: /s/ Jason Warnick
Name: Jason Warnick
Title: Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
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POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Vladimir Tenev and Jason Warnick, jointly and severally, his or her attorney-in-fact, with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Signature Title Date
By: /s/ Vladimir Tenev Co-Founder, Chief Executive Officer and President and Director February 27, 2024
Vladimir Tenev
By: /s/ Jason Warnick Chief Financial Officer February 27, 2024
Jason Warnick (Principal Financial Officer and Principal Accounting Officer)
By: /s/ Baiju Bhatt Director February 27, 2024
Baiju Bhatt
By: /s/ Paula Loop Director February 27, 2024
Paula Loop
By: /s/ Jonathan Rubinstein Director February 27, 2024
Jonathan Rubinstein
By: /s/ Meyer Malka Director February 27, 2024
Meyer Malka
By: /s/ Robert Zoellick Director February 27, 2024
Robert Zoellick
By: /s/ Dara Treseder Director February 27, 2024
Dara Treseder
By: /s/ Frances Frei Director February 27, 2024
Frances Frei
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