Symbotic 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 (our principal executive officer and principal financial officer, respectively), has evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Annual Report on Form 10-K. The term “disclosure controls and procedures,” as defined in the Exchange Act, 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 Securities and Exchange Commission’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, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. 116 Table of Contents Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of September 28, 2024, our disclosure controls and procedures were not effective at the reasonable assurance level because of the existence of the material weaknesses described in Management’s Report on Internal Control over Financial Reporting. 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 consolidated financial statements will not be prevented or detected on a timely basis. Notwithstanding the material weaknesses in internal control over financial reporting, our management, including our Chief Executive Officer and Chief Financial Officer, have concluded that our consolidated financial statements present fairly, in all material respects, our financial position, results of our operations and our cash flows for the periods presented in this Annual Report on Form 10-K, in conformity with U.S. GAAP. There can be no assurance that these material weaknesses will not result in a misstatement to the annual or interim consolidated financial statements for future periods that would not be prevented or detected. Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting for our company. Internal control over financial reporting is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively) and effected by our board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. Our management has conducted an evaluation of the effectiveness of our internal control over financial reporting as of September 28, 2024. In conducting this evaluation, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013). Based upon this evaluation and those criteria, management, including our Chief Executive Officer and Chief Financial Officer, concluded that, as of September 28, 2024, the Company’s internal control over financial reporting was not effective due to the identification of the material weaknesses described below. As of September 28, 2024, the Company did not effectively design procedures and controls over the timing of the recognition of cost of revenue. This resulted in the acceleration of the recognition of cost of revenue. Given that we recognize revenue on a percentage of completion basis, this resulted in the acceleration of recognition of revenue. Additionally, the Company did not effectively design and execute controls over revenue recognition related to cost overruns on certain deployments that will not be billable. This resulted in an overstatement of revenue during the fiscal year 2024. These deficiencies in internal control over financial reporting constituted material weaknesses as of September 28, 2024. These material weaknesses did not result in a material misstatement to the Company’s consolidated financial statements for the year ended September 28, 2024. On December 3, 2024, the Company filed restated unaudited interim financial statements on Form 10-Q/A for the first, second and third quarters of fiscal year 2024 that were previously filed in the Company’s quarterly reports on Form 10-Q on February 8, 2024, May 7, 2024 and July 31, 2024, respectively. There can be no assurance that these material weaknesses will not result in a misstatement to the annual or interim consolidated financial statements for future periods that would not be prevented or detected. Our independent registered public accounting firm, Grant Thornton LLP, who audited the consolidated financial statements included in this Annual Report on Form 10-K, issued an adverse opinion on the effectiveness of the Company’s internal control over financial reporting. Changes in Internal Control Over Financial Reporting Subject to the steps taken in connection with the remediation plan noted below, there have been no changes in our internal control over financial reporting for the three months ended September 28, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Material Weakness Remediation Plan Management has developed a remediation plan, which it began implementing as of the end of fiscal year 2024, that includes the following elements: • Augmented compensating controls over the receipt of goods and services, with a focus on milestone related expenses; 117 Table of Contents • Implemented ERP system enhancements for goods and services receipts and enhanced documentation requirements for milestone related expenses; • Training of the employees and redesign of the structure of the organization receiving goods and services; and • Implemented compensating controls over revenue recognition for non-billable cost overruns. Management is committed to the completion of the remediation of these material weaknesses and expects to successfully implement enhanced control processes. Management has also engaged third-party consultants to evaluate and help simplify business processes around the receipts of goods and services. However, as management continues to evaluate and work to improve its internal control over financial reporting, it may determine that additional measures to address control deficiencies or modifications to the remediation plan are necessary. Therefore, management cannot assure you when these material weaknesses will be remediated, that additional actions will not be required to remediate these material weaknesses, or the costs of any such additional actions. These material weaknesses will not be considered remediated until the remediated controls operate for a sufficient period of time and management has concluded, through further testing, that these controls are operating effectively. Item 9B. Other Information During the fiscal quarter ended September 28, 2024, the following director(s) and officer(s), as defined in Rule 16a-1(f) under the Exchange Act, adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as defined in Regulation S-K Item 408: On August 28, 2023 , Corey Dufresne , the Company’s Senior Vice President and General Counsel , entered into a trading plan pursuant to Rule 10b5-1 of the Exchange Act. Mr. Dufresne’s Rule 10b5-1 trading plan provides for the sale of shares of Class A Common Stock that he has received or will receive following the vesting of various RSU grants. Mr. Dufresne’s 10b5-1 trading plan calls for the sale of a percentage of shares that he could receive upon the future vesting of certain outstanding equity awards, net of any shares withheld by us to satisfy applicable taxes. The number of shares to be withheld, and thus the exact number of shares to be sold pursuant to Mr. Dufresne’s 10b5-1 trading plan, can only be determined upon the occurrence of the future vesting events. For purposes of this disclosure, without subtracting any shares to be withheld upon future vesting events, the maximum aggregate number of shares that may be sold pursuant to Mr. Dufresne’s 10b5-1 trading plan is 62,362 shares of Class A Common Stock. Mr. Dufresne’s Rule 10b5-1 trading plan expires on August 31, 2025 , or earlier if all transactions under the trading arrangement are completed. The trading arrangement is intended to satisfy the affirmative defense in Rule 10b5-1(c) under the Exchange Act. On August 29, 2023 , William Boyd , the Company’s Chief Strategy Officer , entered into a trading plan pursuant to Rule 10b5-1 of the Exchange Act. Mr. Boyd’s Rule 10b5-1 trading plan provides for the sale of shares of Class A Common Stock held by him, as well as shares that he has received or will receive following the vesting of various RSU grants. Mr. Boyd’s 10b5-1 trading plan calls for the sale of a percentage of shares that he could receive upon the future vesting of certain outstanding equity awards, net of any shares withheld by us to satisfy applicable taxes. The number of shares to be withheld, and thus the exact number of shares to be sold pursuant to Mr. Boyd’s 10b5-1 trading plan, can only be determined upon the occurrence of the future vesting events. For purposes of this disclosure, without subtracting any shares to be withheld upon future vesting events, the maximum aggregate number of shares that may be sold pursuant to Mr. Boyd’s 10b5-1 trading plan is 105,665 shares of Class A Common Stock. Mr. Boyd’s Rule 10b5-1 trading plan expires on December 31, 2025 , or earlier if all transactions under the trading arrangement are completed. The trading arrangement is intended to satisfy the affirmative defense in Rule 10b5-1(c) under the Exchange Act. On September 6, 2024 , Michael Dunn , the Company’s Senior Vice President, Sales, Marketing and Product Strategy , entered into a trading plan pursuant to Rule 10b5-1 of the Exchange Act. Mr. Dunn’s Rule 10b5-1 trading plan provides for the sale of shares of Class A Common Stock that he has received or will receive following the vesting of various RSU grants. Mr. Dunn’s 10b5-1 trading plan calls for the sale of a percentage of shares that he could receive upon the future vesting of certain outstanding equity awards, net of any shares withheld by us to satisfy applicable taxes. The number of shares to be withheld, and thus the exact number of shares to be sold pursuant to Mr. Dunn’s 10b5-1 trading plan, can only be determined upon the occurrence of the future vesting events. For purposes of this disclosure, without subtracting any shares to be withheld upon future vesting events, the maximum aggregate number of shares that may be sold pursuant to Mr. Dunn’s 10b5-1 trading plan is 106,596 . Mr. Dunn’s Rule 10b5-1 trading plan expires on June 30, 2025 , or earlier if all transactions under the trading arrangement are completed. The trading arrangement is intended to satisfy the affirmative defense in Rule 10b5-1(c). 118 Table of Contents Certain of our directors or officers have made elections to participate in, and are participating in, our Incentive Compensation Plan, ESPP or our defined-contribution benefit plan under the provisions of Section 401(k) of the Internal Revenue Code and have may, and may from time to time make, elections 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. PART III Item 10. Directors, Executive Officers and Corporate Governance The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement pursuant to Regulation 14A, which proxy statement will be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended September 28, 2024. We have adopted a written code of business conduct and ethics that will apply to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the code can be found at http:/ir.symbotic.com/corporate-governance/documents-charters under the link “Code of Business Conduct and Ethics.” In addition, we intend to post on our website all disclosures that are required by law or NASDAQ listing standards concerning any amendments to, or waivers from, any provision of the code of business conduct and ethics. The information on any of our websites is deemed not to be incorporated in this proxy statement or to be part of this proxy statement. Item 11. Executive Compensation The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement pursuant to Regulation 14A, which proxy statement will be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended September 28, 2024. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement pursuant to Regulation 14A, which proxy statement will be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended September 28, 2024. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement pursuant to Regulation 14A, which proxy statement will be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended September 28, 2024. Item 14. Principal Accounting Fees and Services The information required under this item is incorporated herein by reference to the Company’s definitive proxy statement pursuant to Regulation 14A, which proxy statement will be filed with the Securities and Exchange Commission not later than 120 days after the close of the Company’s fiscal year ended September 28, 2024. PART IV Item 15. Exhibits, Financial Statement Schedules (a) 1. Financial Statements (included in Item 8 of this Annual Report on Form 10-K): • Report of Independent Registered Public Accounting Firm • Consolidated Balance Sheets as of September 28, 2024 and September 30, 2023 • Consolidated Statements of Operations for the years ended September 28, 2024, September 30, 2023, and September 24, 2022 • Consolidated Statements of Comprehensive Loss for the years ended September 28, 2024, September 30, 2023, and September 24, 2022 • Consolidated Statements of Changes in Redeemable Preferred and Common Units and Equity (Deficit) for the years ended September 28, 2024, September 30, 2023, and September 24, 2022 119 Table of Contents • Consolidated Statements of Cash Flows for the years ended September 28, 2024, September 30, 2023, and September 24, 2022 • Notes to Consolidated Financial Statements 2. Financial Statement Schedules Financial statements schedules are omitted as they are either not required or the information is otherwise included in the consolidated financial statements. (b) Exhibits These exhibits listed below are filed or incorporated by reference into this Report. Incorporated by Reference Exhibit Description Form Exhibit Filing Date 2.1++ Agreement and Plan of Merger, dated December 12, 2021, among SVF Investment Corp. 3, Warehouse Technologies LLC, Symbotic Holdings LLC and Saturn Acquisition (DE) Corp. 8-K 2.1 12/13/2021 3.1 Certificate of Incorporation of Symbotic Inc. 8-K 3.1 6/13/2022 3.2 Bylaws of Symbotic Inc. 8-K 3.2 6/13/2022 4.1++ Warrant to Purchase Common Units, dated June 7, 2022, between Symbotic Holdings LLC and Walmart Inc. 8-K 4.1 6/13/2022 4.2 Warrant to Purchase Class A Common Stock, dated July 23, 2023, between Symbotic Inc. and Sunlight Investment Corp. 8-K 4.1 7/24/2023 4.3 Description of Securities of Symbotic Inc. 10-K 4.2 12/09/2022 4.4 Form of Indenture S-3 4.1 7/24/2023 10.1++ Amended and Restated Registration Rights Agreement, dated June 7, 2022, among Symbotic Inc., SVF Sponsor III (DE) LLC, certain legacy directors of SVF Investment Corp. 3, and certain directors, officers and stockholders of Symbotic Inc. 8-K 10.1 6/13/2022 10.2 Tax Receivable Agreement, dated June 7, 2022, among Symbotic Inc., Symbotic Holdings LLC and certain members of Symbotic Holdings LLC 8-K 10.2 6/13/2022 10.3++ Second Amended and Restated Limited Liability Company Agreement of Symbotic Holdings LLC, dated June 7, 2022 8-K 10.3 6/13/2022 10.4# Form of Indemnification Agreement between Symbotic Inc. and each of its directors and executive officers. 8-K 10.4 6/13/2022 10.5# Symbotic Inc. 2022 Omnibus Incentive Compensation Plan 8-K 10.5 6/13/2022 10.6# Form of Restricted Stock Unit Award Agreement under the Symbotic Inc. 2022 Omnibus Incentive Compensation Plan 8-K 10.6 6/13/2022 10.7# Form of Performance-Based Restricted Stock Unit Award Agreement under the Symbotic Inc. 2022 Omnibus Incentive Compensation Plan 8-K 10.7 6/13/2022 10.8# Symbotic Inc. 2022 Employee Stock Purchase Plan 8-K 10.8 6/13/2022 10.9# Symbotic LLC / Warehouse Technologies, LLC 2012 Value Appreciation Plan S-4 10.26 3/23/2022 10.10# Symbotic LLC / Symbotic Canada ULC / Warehouse Technologies LLC Amended and Restated 2018 Long Term Incentive Plan S-4 10.27 3/23/2022 10.11# Offer Letter, dated as of March 24, 2022, by and between Symbotic LLC and Michael J. Loparco S-4 10.28 4/22/2022 10.12 Forward Purchase Agreement, dated March 8, 2021, between SVF Investment Corp. 3 and SVF II SPAC Investment 3 (DE) LLC 8-K 10.6 3/12/2021 120 Table of Contents 10.13++ Unit Purchas e Agreement, dated December 12, 2021, among SVF Investment Corp. 3, Warehouse Technologies LLC, Symbotic Holdings LLC, RJJRP Holdings, Inc., RBC 2021 4 Year GRAT 4 (U/A March 31, 2021) and RBC Millennium Trust (U/A June 19, 2000) 8-K 10.5 12/13/2021 10.14++^ Second Amended and Restated Master Automation Agreement, dated May 20, 2022, among Walmart Inc., Symbotic LLC and Warehouse Technologies LLC S-4 10.32 5/23/2022 10.15# Offer Letter, dated as of April 21, 2017, between Symbotic LLC and Michael Dunn 8-K 10.17 6/13/2022 10.16# Offer Letter, dated September 1, 2020, between Symbotic LLC and Thomas Ernst 8-K 10.18 6/13/2022 10.17# Offer Letter, dated January 13, 2023 between Symbotic LLC and Walter Odisho 10-Q 10.1 2/08/2024 10.18 Investment and Subscription Agreement, dated as of December 12, 2021, between Warehouse Technologies LLC and Walmart, Inc. S-4 10.33 5/23/2022 10.19++^ Framework Agreement, dated July 23, 2023, among Symbotic Inc., Symbotic Holdings LLC, Symbotic LLC, Sunlight Investment Corp., SVF II Strategic Investments AIV LLC and GreenBox Systems LLC 8-K 10.1 7/24/2023 10.20++^ Amended and Restated Limited Liability Company Agreement of GreenBox Systems LLC, dated September 25, 2024, among GreenBox Systems LLC, Symbotic Holdings LLC and Sunlight Investment Corp. 10.21++^ Master Services, License and Equipment Agreement, dated July 23, 2023, b etween GreenBox Systems LLC and Symbotic LLC 8-K 10.3 7/24/2023 10.22# Separation Agreement and General Release of Claims, dated November 19, 2022, between Symbotic Inc. and Michael J. Loparco 8-K 10.1 11/21/2022 10.23# Transition Agreement, dated October 1, 2023 , between Symbotic LLC and Thomas Ernst 8-K 10.1 10/02/2023 10.24# Offer Letter, dated September 17, 2023, between Symbotic LLC and Carol Hibbard 8-K 10.2 10/02/2023 10.25# Offer Letter, dated February 10, 2020, between Symbotic LLC and William Boyd 10.26# Offer Letter, dated June 17, 2020, between Symbotic LLC and George Dramalis 10.27# Offer Letter, dated November 7, 2011, between Symbotic LLC (f/k/a CasePick Systems, LLC ) and Corey Dufresne 10.28# Separation and Severance Agreement, dated April 1, 2014, between Symbotic LLC and Corey Dufresne 19.1 Symbotic Inc. Insider Trading Policy 21.1 List of Subsidiaries of Symbotic Inc. 23.1 Consent of Grant Thornton LLP 31.1 Certification of the Chief Executive Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934 31.2 Certification of the Chief Financial Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934 32.1 Certification of the 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 the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 97.1 Symbotic Inc. Clawback Policy: Recovery of Erroneously Awarded Incentive-Based Compensation 10-K 97.1 12/11/2023 121 Table of Contents 101.INS Inline Instance Document 101.SCH Inline Taxonomy Extension Schema Document 101.CAL Inline Taxonomy Extension Calculation Linkbase Document 101.DEF Inline Taxonomy Extension Definition Linkbase Document 101.LAB Inline Taxonomy Extension Label Linkbase Document 101.PRE Inline Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) # Indicates management contract or compensatory plan ++ Certain of the exhibits and schedules have been omitted in accordance with Item 601(a)(5) of Regulation S-K. We agree to furnish a copy of all omitted exhibits and schedules to the SEC upon its request. ^ Certain confidential information, marked by brackets and asterisks, has been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because we customarily and actually treat such information as private or confidential and the omitted information is not material. (c) Not applicable. Item 16. Form 10-K Summary None. 122 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SYMBOTIC INC. Date: December 4, 2024 By: /s/ Maria G. Freve Name: Maria G. Freve Title: Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer) Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Signature Title Date /s/ Richard B. Cohen Chief Executive Officer, President and Director December 4, 2024 Richard B. Cohen (Principal Executive Officer) /s/ Carol Hibbard Chief Financial Officer and Treasurer December 4, 2024 Carol Hibbard (Principal Financial Officer) /s/ Maria G. Freve Vice President, Controller and Chief Accounting Officer December 4, 2024 Maria G. Freve (Principal Accounting Officer) /s/ Rollin Ford Director December 4, 2024 Rollin Ford /s/ Charles Kane Director December 4, 2024 Charles Kane /s/ Todd Krasnow Director December 4, 2024 Todd Krasnow /s/ Vikas J. Parekh Director December 4, 2024 Vikas J. Parekh /s/ Daniela Rus Director December 4, 2024 Daniela Rus /s/ Merline Saintil Director December 4, 2024 Merline Saintil 123