Life360, Inc. 10-K

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, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2022 pursuant to Rule 13a‑15 under the Exchange Act. The term “disclosure controls and procedures” means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits 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 ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Based on the evaluation of our disclosure controls and procedures as of December 31, 2022, our Chief Executive Officer and Chief Financial Officer concluded that, as a result of material weaknesses in our internal control over financial reporting discussed below, our disclosure controls and procedures were not effective as of December 31, 2022. Notwithstanding the material weaknesses, management has concluded the Consolidated Financial Statements included in this Annual Report on Form 10-K present fairly, in all material respects, the Company’s financial position, results of operations and cash flows of the Company for the periods presented in conformity with U.S. GAAP. 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 and interim financial statements will not be detected or prevented on a timely basis. As of December 31, 2022, our management identified a material weakness related to management’s risk assessment process over ITGCs, the design and implementation of ITGCs, including certain controls over logical access, segregation of duties and change management, and certain process level controls including information used in the execution of those controls that impacted our financial reporting processes. The material weakness did not result in any identified misstatements in the financial statements, and there were no changes to previously issued financial results. However, the material weakness creates a reasonable possibility that a material misstatement to our consolidated financial statements would not be prevented or detected on a timely basis. 111 Table of Contents In order to remediate the material weakness, we plan to take the following actions: • Developing enhanced risk assessment procedures and controls to address IT risks related to key systems that support financial reporting. • Broadening the scope and improving the effectiveness of existing information technology general controls for access management, segregation of duties, change management and computer operations. • Enhancing documentation of our IT controls for systems key to our financial reporting process. • Providing training relating to the importance and execution of IT general controls for key systems that support financial reporting. • Performing an in-depth analysis of the roles and accesses within key financial reporting systems and redesigning roles and accesses to support a stronger control environment. • Engaging internal and external resources to assist us with remediation and monitoring remediation progress. While we believe these efforts will remediate the material weakness, the material weakness cannot be considered fully remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively. 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 due to a transition period established by the rules of SEC for newly public companies. Additionally, our independent registered accounting firm will not be required to opine on the effectiveness of our internal control over financial reporting pursuant to Section 404 until we are no longer an “emerging growth company” as defined in the JOBS Act. Changes in Internal Control over Financial Reporting Except for the changes intended to remediate the material weaknesses described above, there were no changes in 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 year ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Limitations on the Effectiveness of Controls and Procedures Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and implemented, can provide only reasonable, not absolute, assurance that the control system’s objectives will be 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 within a company are detected. The inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that 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 may occur and may not be detected. Item 9B. Other Information. None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. Not applicable. 112 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance. The information required by this item will be contained in the Company’s definitive Proxy Statement for its 2023 Annual Stockholder Meeting, to be filed with the SEC within 120 days after December 31, 2022, under the headings “Proposal 1 - Election of Directors” and “Executive Officers” and is incorporated herein by reference . We have adopted a code of conduct that applies to our directors, officers, and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. If we make any substantive amendments to the code of conduct or grant any waiver from a provision of the code of conduct to any executive officer or director, we will promptly disclose the nature of the amendment or waiver on our website. The full text of our code of conduct is on the investor relations portion of our website at investors.life360.com. The inclusion of our website address in this Annual Report on Form 10-K does not include or incorporate by reference into this Annual Report on Form 10-K the information on or accessible through our website. Item 11. Executive Compensation. The information required by this item will be contained in the Company’s definitive Proxy Statement for its 2023 Annual Stockholder Meeting, to be filed with the SEC within 120 days after December 31, 2022, under the heading “Executive Compensation,” 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 contained in the Company’s definitive Proxy Statement for its 2023 Annual Stockholder Meeting, to be filed with the SEC within 120 days after December 31, 2022, under the heading “Security Ownership of Certain Beneficial Owners and Management,” and is incorporated herein by reference . Item 13. Certain Relationships and Related Transactions, and Director Independence. The information required by this item will be contained in the Company’s definitive Proxy Statement for its 2023 Annual Stockholder Meeting, to be filed with the SEC within 120 days after December 31, 2022, under the heading “Transactions with Related Persons and Indemnification,” and is incorporated herein by reference . Item 14. Principal Accountant Fees and Services. The information required by this item will be contained in the Company’s definitive Proxy Statement for its 2023 Annual Stockholder Meeting, to be filed with the SEC within 120 days after December 31, 2022, under the heading “Principal Accountant Fees and Services,” and is incorporated herein by reference . 113 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules. The following documents are filed as part of this Annual Report on Form 10-K: 1. 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. The financial statement schedules have been omitted as they are either not applicable or the required information is otherwise included. 3. Exhibits. The exhibits required to be filed as part of this report are listed in the Exhibit List attached hereto and are incorporated herein by reference. Incorporated by Reference Exhibit No. Description Filed Herewith Form File No. Filing Date Exhibit Number 2.1†* Agreement and Plan of Merger dated November 22, 2021, by and among Life360, Inc., Triumph Merger, Sub, Inc., Tile, Inc., and Fortis Advisors LLC. 10-12G/A 000-56424 July 5, 2022 2.1 2.2†* Amendment No. 1 to Agreement and Plan of Merger dated December 20, 2021, by and among Life360, Inc., Triumph Merger, Sub, Inc., Tile, Inc., and Fortis Advisors LLC. 10-12G/A 000-56424 July 5, 2022 2.2 2.3†* Agreement and Plan of Merger dated July 27, 2021, by and among Life360, Inc., Jiobit Merger Sub I, Inc., Jiobit Merger Sub II, LLC, Jio, Inc. and Shareholder Representative Services LLC. 10-12G/A 000-56424 July 5, 2022 2.3 2.4†* Amendment No.1 to Agreement and Plan of Merger dated August 31, 2021, by and among Life360, Inc., Jiobit Merger Sub I, Inc., Jiobit Merger Sub II, LLC, Jio, Inc. and Shareholder Representative Services LLC. 10-12G/A 000-56424 July 5, 2022 2.4 2.5†* Second Amendment dated April 11, 2022, by and between Life360, Inc. and Shareholder Representative Services LLC, to that certain Agreement and Plan of Merger dated July 27, 2021, by and among Life360, Inc., Jiobit Merger Sub I, Inc., Jiobit Merger Sub II, LLC, Jio, Inc. and Shareholder Representative Services LLC. 10-12G/A 000-56424 July 5, 2022 2.5 3.1* Amended and Restated Certificate of Incorporation of the Company. 10-12G/A 000-56424 July 5, 2022 3.1 3.2 Amended and Restated Bylaws of the Company. X 4.1†* Fourth Amended and Restated Investors’ Rights Agreement dated September 18, 2018, by and among Life360, Inc., the Founders, the Existing Preferred Holders and the New Investors. 10-12G/A 000-56424 July 5, 2022 4.1 114 Table of Contents 10.1+* Form of Indemnification Agreement between Life360 and its directors and officers. 10-12G/A 000-56424 July 5, 2022 10.1 10.2+* Amended and Restated 2011 Stock Plan. 10-12G/A 000-56424 July 5, 2022 10.2 10.3+* Form of Amended and Restated 2011 Stock Plan Restricted Stock Unit Agreement. 10-12G/A 000-56424 July 5, 2022 10.3 10.4+* Form of Amended and Restated 2011 Stock Plan Stock Option Agreement. 10-12G/A 000-56424 July 5, 2022 10.4 10.5+* Life360 Compensation Plan for Board Directors and Company Leadership. 10-12G/A 000-56424 July 5, 2022 10.5 10.6+* Employment Agreement, dated May 14, 2019, between Life360, Inc. and Chris Hulls. 10-12G/A 000-56424 July 5, 2022 10.6 10.7+†* Employment Agreement, dated November 22, 2021, by and between Tile, Inc., pursuant to that certain Agreement and Plan of Merger, dated November 22, 2021, by and between the Company, Life360, Inc. and certain other parties, and Charles J. Prober. 10-12G/A 000-56424 July 5, 2022 10.8 10.8+* First Amendment to Employment Agreement, dated April 7, 2022, between Life360, Inc. and Charles J. Prober. 10-12G/A 000-56424 July 5, 2022 10.9 10.9+* Offer Letter, dated September 5, 2019, between Life360, Inc. and Samir Kapoor. 10-12G/A 000-56424 July 5, 2022 10.10 10.10+* Retention Bonus Letter between Life360, Inc. and Christopher Hulls (2016). 10-12G/A 000-56424 July 5, 2022 10.11 10.11§* Data Services and License Agreement, effective as of January 26, 2022, by and between Life360, Inc. and Placer Labs Inc. 10-12G/A 000-56424 July 5, 2022 10.13 10.12§* Amendment No. 1 to Data Services and License Agreement, effective as of May , 2022, by and between Life360, Inc. and Placer Labs Inc. 10-12G/A 000-56424 July 5, 2022 10.14 10.13†§* Warranty Program Agreement, dated June 26, 2020, by and between Cover Genius Warranty Services, LLC and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.15 10.14§* First Amendment to the Warranty Program Agreement, dated September 17, 2020, by and between Cover Genius Warranty Services, LLC and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.16 10.15§* Second Amendment to the Warranty Program Agreement, dated October 8, 2021, by and between Cover Genius Warranty Services, LLC and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.17 10.16§* Manufacturing Services Agreement, dated March 8, 2017, by and between Jabil Circuit, Inc., Jabil Circuit (Singapore) Pte. Ltd. and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.18 10.17* Letter Agreement, dated June 2, 2022, by and among Jabil, Inc., Jabil Circuit (Singapore) Pte. Ltd. and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.19 115 Table of Contents 10.18†* Office Lease for 1900 S. Norfolk Street, Suite 310, San Mateo, California, dated September 12, 2019, by and between 1900 Atrium Associates, LP and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.31 10.19* First Amendment to Lease for 1900 S. Norfolk Street, Suite 310, San Mateo, California, dated August 18, 2020, by and between 1900 Atrium Associates, LP and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.32 10.20* Second Amendment to Lease for 1900 S. Norfolk Street, Suite 310, San Mateo, California, dated January 10, 2022, by and between 1900 Atrium Associates, LP and Tile, Inc. 10-12G/A 000-56424 July 5, 2022 10.33 10.21†* Sublease Agreement for 30 North LaSalle Street, Chicago, Illinois, dated as of March 9, 2019, by and between Bin Insurance Holdings, LLC and Jio, Inc. 10-12G/A 000-56424 July 5, 2022 10.34 10.22* Vendor Terms and Conditions between Tile, Inc. and Amazon.com, effective June 4, 2018. 10-12G/A 000-56424 July 5, 2022 10.35 10.23* Apple Developer Program License Agreement between Life360, Inc. and Apple Inc. 10-12G/A 000-56424 July 5, 2022 10.36 10.24* Schedules 2 and 3 to Apple Developer Program License Agreement between Life360, Inc. and Apple Inc. 10-12G/A 000-56424 July 5, 2022 10.37 21.1* List of Subsidiaries of the Company. 10-12G/A 000-56424 July 5, 2022 21.1 23.1 Consent of BDO USA, LLP, an Independent Registered Public Accounting Firm. X 24.1 Power of Attorney (included on the signature page to this report). X 31.1 Chief Executive Officer Certification Pursuant to Rule 13a-14(a) of the Exchange Act. X 31.2 Chief Financial Officer Certification Pursuant to Rule 13a-14(a) of the Exchange Act. X 32.1 Certification 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 pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. X 101.INS Inline XBRL Instance Document X 101.SCH Inline XBRL Schema Document X 101.CAL Inline XBRL Calculation Linkbase Document X 101.DEF Inline XBRL Definition Linkbase Document X 101.LAB Inline XBRL Label Linkbase Document X 101.PRE Inline XBRL Presentation Linkbase Document X 116 Table of Contents 104 Cover Page Interactive Data (formatted as Inline XBRL and contained in Exhibit 101) X _____________________ * Filed previously. + Indicates a management contract or compensatory plan, contract or arrangement. † Certain exhibits and schedules to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K. The registrant hereby agrees to furnish supplementally a copy of any omitted exhibit or schedule to the SEC upon its request. § Portions of this exhibit have been redacted in accordance with Regulation S-K Item 601(b)(10)(iv) 117 Table of Contents Item 16. Form 10-K Summary None. 118 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. LIFE360, INC. Dated: March 23, 2023 By: /s/ Chris Hulls Chris Hulls Chief Executive Officer (Principal Executive Officer) Dated: March 23, 2023 By: /s/ Russell Burke Russell Burke Chief Financial Officer (Principal Financial Officer) POWER OF ATTORNEY Each person whose individual signature appears below hereby authorizes and appoints Chris Hulls and Russell Burke, and each of them, with full power of substitution and resubstitution and full power to act without the other, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this 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, ratifying and confirming all that said attorneys-in-fact and agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof. 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. 119 Table of Contents Name Title Date /s/ Chris Hulls Chief Executive Officer and Director (Principal Executive Officer) March 23, 2023 Chris Hulls /s/ Russell Burke Chief Financial Officer (Principal Financial and Accounting Officer) March 23, 2023 Russell Burke /s/ Charles (CJ) Prober President and Director March 23, 2023 Charles (CJ) Prober /s/ John Philip Coghlan Chair of the Board of Directors March 23, 2023 John Philip Coghlan /s/ Mark Goines Director March 23, 2023 Mark Goines /s/ Alex Haro Director March 23, 2023 Alex Haro /s/ Brit Morin Director March 23, 2023 Brit Morin /s/ James Synge Director March 23, 2023 James Synge /s/ David Wiadrowski Director March 23, 2023 David Wiadrowski /s/ Randi Zuckerberg Director March 23, 2023 Randi Zuckerberg 120