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, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). 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 assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Based on our evaluation, our chief executive officer and chief financial officer concluded that, as of July 31, 2023, our disclosure controls and procedures are designed at a reasonable assurance level and are 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 Securities and Exchange Commission (“SEC”) 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 Annual 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) under the Exchange Act. Our management assessed the effectiveness of our internal control over financial reporting as of July 31, 2023, based on the framework set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework (2013 framework). Based on that assessment, management concluded that, as of July 31, 2023, our internal control over financial reporting was effective.
The effectiveness of our internal control over financial reporting as of July 31, 2023 has been audited by Ernst & Young LLP, the independent registered public accounting firm that audits our consolidated financial statements, as stated in their report which is included in Part II, Item 8 of this Annual Report on Form 10-K.
Changes in Internal Control over Financial Reporting
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 quarter ended July 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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Item 9B. Other Information
Trading Plans of Directors and Executive Officers
Set forth below is certain information regarding Rule 10b5-1 trading plans adopted by our directors and officers (as defined in Rule 16a-1(f)) during the fourth quarter of fiscal 2023. The Rule 10b5-1 trading plans listed below are each intended to satisfy the affirmative defense of Rule 10b5-1(c).
Name Title Date Plan Was Adopted Expiration Date Total Amount of Common Stock to be Sold Under the Plan
Nikesh Arora Chairman and Chief Executive Officer June 8, 2023 August 30, 2024 or when all shares have been sold 2,000,000
William “BJ” Jenkins, Jr. President May 26, 2023 June 29, 2024 or when all shares have been sold 13,000
No other officers or directors, as defined in Rule 16a-1(f), adopted , modified and/or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as defined in Regulation S-K Item 408, during the fourth quarter of fiscal 2023.
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 will be contained in our definitive proxy statement to be filed with the SEC in connection with our 2023 annual meeting of stockholders (the “Proxy Statement”), which is expected to be filed not later than 120 days after the end of our fiscal year ended July 31, 2023 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 Owners 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 Accountant 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 Statement Schedules
Documents filed as part of this Annual Report on Form 10-K 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 because they are not required, not applicable, not present in amounts sufficient to require submission of the schedule, or the required information is shown in the Consolidated Financial Statements or the notes thereto.
3. Exhibits
The following documents are incorporated by reference or are filed with this Annual Report on Form 10-K, in each case as indicated therein (numbered in accordance with Item 601 of Regulation S-K).
Exhibit Index
Exhibit
Number Exhibit Description Incorporated by Reference
Form File No. Exhibit Filing Date
3.1
Restated Certificate of Incorporation of the Registrant. 10-K 001-35594 3.1 October 4, 2012
3.2
Amended and Restated Bylaws of the Registrant. 8-K 001-35594 3.1 May 23, 2022
3.3
Certificate of Change of Location of Registered Agent and/or Registered Office. 8-K 001-35594 3.1 August 30, 2016
4. 1
Indenture between the Registrant and U.S. Bank National Association, dated as of June 8, 2020. 8-K 001-35594 4.1 June 8, 2020
4. 2
Form of Global 0.375% Convertible Senior Note due 2025 (included in Exhibit 4.1). 8-K 001-35594 4.2 June 8, 2020
4 .3
Description of Registrant’s Securities.
10.1 *
Form of Indemnification Agreement between the Registrant and its directors and officers. S-1/A 333-180620 10.1 July 9, 2012
10.2 *
2012 Equity Incentive Plan and related form agreements. 10-Q 001-35594 10.2 November 26, 2019
10.3 *
Form of 2012 Equity Incentive Plan Performance-Based Restricted Stock Unit Award Agreement. 10-Q 001-35594 10.4 November 19, 2021
10.4 *
2021 Equity Incentive Plan. S-8 333-268930 99.1 December 21, 2022
10.5 *
Form of 2021 Equity Incentive Plan Global Stock Option Award Agreement. S-8 333-261697 99.2 December 16, 2021
10.6 *
Form of 2021 Equity Incentive Plan Global Restricted Stock Unit Award Agreement. S-8 333-261697 99.3 December 16, 2021
10.7 *
2012 Employee Stock Purchase Plan, as amended and restated, and related form agreements. 10-K 001-35594 10.7 September 6, 2022
10.8 *
RedLock Inc. 2015 Stock Plan, as amended, and related form agreements under RedLock Inc. 2015 Stock Plan, as amended. S-8 333-227901 99.1 October 19, 2018
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Exhibit
Number Exhibit Description Incorporated by Reference
Form File No. Exhibit Filing Date
10. 9 *
Aporeto, Inc. Amended and Restated 2015 Stock Option and Grant Plan. S-8 333-235854 99.1 January 8, 2020
10.1 0 *
CloudGenix Inc. 2013 Equity Incentive Plan. S-8 333-238014 99.1 May 5, 2020
10.11 *
Crypsis Group Holdings, LLC 2017 Equity Incentive Plan. S-8 333-249387 99.1 October 8, 2020
10.12 *
Sinefa Group, Inc. 2020 Stock Plan. S-8 333-251423 99.1 December 17, 2020
10.1 3 *
Expanse Holding Company, Inc. Amended and Restated 2012 Stock Incentive Plan S-8 333-251425 99.1 December 17, 2020
10.1 4 *
Gamma Networks, Inc. 2018 Stock Option and Grant Plan. S-8 333-259327 99.1 September 3, 2021
10.15 *
Bridgecrew, Inc. 2019 Stock Incentive Plan. S-8 333-254042 99.1 March 9, 2021
10.1 6 *
Cider Security Ltd. 2020 Equity Incentive Plan. S-8 333-268931 99.1 December 21, 2022
10.17 *
US Sub-Plan to Cider Security Ltd. 2020 Equity Incentive Plan. S-8 333-268931 99.2 December 21, 2022
10.18 *
Employee Incentive Compensation Plan, as amended and restated. 10-Q 001-35594 10.2 November 25, 2014
10.19 *
Clawback Policy, adopted as of August 29, 2017. 10-Q 001-35594 10.3 November 21, 2017
10.2 0 *
Amended and Restated Outside Director Compensation Policy (last amended February 16, 2022). 10-Q 001-35594 10.4 February 23, 2022
10.2 1 *
Continued Service Policy. 10-Q 001-35594 10.3 May 20, 2022
10.22 *
Palo Alto Networks, Inc. Deferred Compensation Plan effective June 1, 2022 10-K 001-35594 10.23 September 6, 2022
10.2 3 *
Employment Agreement between Palo Alto Networks (Israel Analytics) Ltd. and Nir Zuk, dated August 18, 2020. 10-Q 001-35594 10.1 November 19, 2020
10.2 4 *
Offer Letter between the Registrant and Nikesh Arora, dated May 30, 2018. 8-K 001-35594 10.2 June 4, 2018
10.2 5 *
Offer Letter between the Registrant and Josh Paul, dated August 5, 2021. 8-K 001-35594 10.1 September 8, 2021
10.26 *
Confirmatory Employment Letter with Updated Change in Control Protection between the Registrant and Lee Klarich, dated December 19, 2011. 10-Q 001-35594 10.4 November 30, 2018
10.27 *
Addendum to Employment Offer Letter by and between the Registrant and Dipak Golechha, dated March 17, 2021. 8-K 001-35594 10.1 March 19, 2021
10.28 *
Addendum to Employment Offer Letter by and between the Registrant and Dipak Golechha, dated February 18, 2022. 10-Q 001-35594 10.1 May 20, 2022
10.29 *
Employment Offer Letter by and between the Registrant and William “BJ” Jenkins, dated July 27, 2021. 8-K 001-35594 10.1 August 12, 2021
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Exhibit
Number Exhibit Description Incorporated by Reference
Form File No. Exhibit Filing Date
10.30 *
Addendum to Employment Offer Letter between the Registrant and William “BJ” Jenkins, dated February 18, 2022.
10-Q 001-35594 10.2 May 20, 2022
10.3 1 *
Form of Offer Letter between the Registrant and its directors. 10-K 001-35594 10.27 September 3, 2021
10.3 2 **
Amended and Restated Flextronics Manufacturing Services Agreement, by and between the Registrant and Flextronics Telecom Systems Ltd., dated April 1, 2019. 10-Q 001-35594 10.1 May 30, 2019
10.33
Vendor Information Security Terms between the Registrant and Flextronics Telecom Systems Ltd., dated July 23, 2021.
10-K 001-35594 10.29 September 3, 2021
10.34
Form of Convertible Note Hedge Confirmation. 8-K 001-35594 10.2 June 8, 2020
10.35
Form of Warrant Confirmation. 8-K 001-35594 10.3 June 8, 2020
10.36
Lease between the Registrant and Santa Clara Campus Property Owner I LLC, dated May 28, 2015. 10-K 001-35594 10.29 September 17, 2015
10.37
Lease between the Registrant and Santa Clara Campus Property Owner I LLC, dated May 28, 2015. 10-K 001-35594 10.30 September 17, 2015
10.38
Lease between the Registrant and Santa Clara Campus Property Owner I LLC, dated May 28, 2015. 10-K 001-35594 10.31 September 17, 2015
10.39
Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated October 7, 2015. 8-K/A 001-35594 10.1 October 19, 2015
10.40
Amendment No. 1 to Lease by and between the Registrant and Santa Clara Phase I Property LLC, dated November 9, 2015. 10-Q 001-35594 10.2 November 24, 2015
10.41
Amendment No. 1 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated November 9, 2015. 10-Q 001-35594 10.3 November 24, 2015
10.42
Amendment No. 1 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated September 16, 2016. 10-Q 001-35594 10.1 November 22, 2016
10.43
Amendment No. 1 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated September 16, 2016. 10-Q 001-35594 10.2 November 22, 2016
10.44
Amendment No. 2 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated September 16, 2016. 10-Q 001-35594 10.3 November 22, 2016
10.45
Amendment No. 2 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated November 16, 2016. 10-Q 001-35594 10.1 March 1, 2017
10.46
Amendment No. 2 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated November 16, 2016. 10-Q 001-35594 10.2 March 1, 2017
10.47
Amendment No. 3 to Lease by and between the Registrant and Santa Clara Campus Property Owner I LLC, dated November 16, 2016. 10-Q 001-35594 10.3 March 1, 2017
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Exhibit
Number Exhibit Description Incorporated by Reference
Form File No. Exhibit Filing Date
10.48
Amendment No. 3 to Lease by and between the Registrant and Santa Clara EFH LLC, dated June 22, 2017. 10-K 001-35594 10.40 September 7, 2017
10.49
Amendment No. 3 to Lease by and between the Registrant and Santa Clara G LLC, dated June 22, 2017. 10-K 001-35594 10.41 September 7, 2017
10.50
Amendment No. 4 to Lease by and between the Registrant and Santa Clara EFH LLC, dated June 22, 2017. 10-K 001-35594 10.42 September 7, 2017
10.51
Amendment No. 4 to Lease by and between the Registrant and Santa Clara Phase III EFH LLC, dated September 29, 2017. 10-Q 001-35594 10.5 November 21, 2017
10.52
Amendment No. 4 to Lease by and between the Registrant and Santa Clara Phase III G LLC, dated September 29, 2017. 10-Q 001-35594 10.6 November 21, 2017
10.53
Amendment No. 5 to Lease by and between the Registrant and Santa Clara Phase III EFH LLC, dated September 29, 2017. 10-Q 001-35594 10.7 November 21, 2017
10. 5 4
Credit Agreement, dated as of April 13, 2023 among the Registrant, the lenders party thereto and Wells Fargo, National Association, as administrative agent. 8-K 001-35594 10.1 April 19, 2023
21.1
List of subsidiaries of the Registrant.
23.1
Consent of Independent Registered Public Accounting Firm.
24.1
Power of Attorney (contained in the signature page to this Annual Report on Form 10-K).
31.1
Certification of the Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.
31.2
Certification of the Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.
32.1 †
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 †
Certification of 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 XBRL Instance Document.
101.SCH XBRL Taxonomy Schema Linkbase Document.
101.CAL XBRL Taxonomy Calculation Linkbase Document.
101.DEF XBRL Taxonomy Definition Linkbase Document.
101.LAB XBRL Taxonomy Labels Linkbase Document.
101.PRE XBRL Taxonomy Presentation Linkbase Document.
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Exhibit
Number Exhibit Description Incorporated by Reference
Form File No. Exhibit Filing Date
104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
* Indicates a management contract or compensatory plan or arrangement.
** Certain portions of this exhibit have been omitted as the Registrant has determined (i) the omitted information is not material and (ii) the omitted information would likely cause harm to the Registrant if publicly disclosed.
† The certifications attached as Exhibit 32.1 and Exhibit 32.2 that accompany this Annual Report on Form 10-K, are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Registrant 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
Not applicable.
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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, on September 1, 2023.
PALO ALTO NETWORKS, INC.
By: /s/ N IKESH A RORA
Nikesh Arora
Chairman and Chief Executive Officer
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Power of Attorney
KNOW ALL THESE PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Nikesh Arora, Dipak Golechha, and Josh Paul, 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, his or her 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 Registrant and in the capacities and on the dates indicated:
Signature Title Date
/s/ NIKESH ARORA Chairman, Chief Executive Officer and Director (Principal Executive Officer) September 1, 2023
Nikesh Arora
/s/ DIPAK GOLECHHA Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) September 1, 2023
Dipak Golechha
/s/ JOSH PAUL Chief Accounting Officer (Duly Authorized Officer and Principal Accounting Officer) September 1, 2023
Josh Paul
/s/ NIR ZUK Chief Technology Officer and Director September 1, 2023
Nir Zuk
/s/ APARNA BAWA
Director September 1, 2023
Aparna Bawa
/s/ JOHN M. DONOVAN Director September 1, 2023
John M. Donovan
/s/ CARL ESCHENBACH Director September 1, 2023
Carl Eschenbach
/s/ DR. HELENE D. GAYLE
Director September 1, 2023
Dr. Helene D. Gayle
/s/ JAMES J. GOETZ Director September 1, 2023
James J. Goetz
/s/ RT HON SIR JOHN KEY Director September 1, 2023
Rt Hon Sir John Key
/s/ MARY PAT MCCARTHY Director September 1, 2023
Mary Pat McCarthy
/s/ LORRAINE TWOHILL Director September 1, 2023
Lorraine Twohill
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