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Item 9A. Controls and Procedures

2022-02-22 compared with 2021-02-26 · 58 added, 33 removed, 129 unchanged (41% of the section changed)

1 unchanged sentence

(a) 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 the end of the period covered by this Annual Report on Form 10-K.

Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2020, 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 SEC'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 disclosures.

Our management, with the participation of our Chief Executive Officer and our Principal 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 the end of the period covered by this Annual Report on Form 10-K.

Based on this evaluation, our Chief Executive Officer and our Principal Financial Officer concluded that, as of December 31, 2021, 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 SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

(b) Management's Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of internal control over financial reporting as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act.

Internal control over financial reporting is a process designed under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, to provide reasonable assurance regarding the reliability of financing reporting and the preparation of financial statements for external purposes in accordance with U.S generally accepted accounting principles.

Under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer and oversight of the board of directors, our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2020, based on the criteria set forth in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

Internal control over financial reporting is a process designed under the supervision and with the participation of our management, including our Chief Executive Officer and our Principal Financial Officer, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S generally accepted accounting principles.

Under the supervision and with the participation of our Chief Executive Officer and our Principal Financial Officer and oversight of the board of directors, our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2021, based on the criteria set forth in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

Based on this evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2021.

The Company acquired Segment.io, Inc.

("Segment") on November 2, 2020.

Management excluded Segment from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2020.

Segment's total assets excluded from this assessment was $253.6 million, representing 3% of the Company’s consolidated total assets as of December 31, 2020, and Segment's total revenue of $ 23.0 million represented 1% of the Company’s consolidated revenue for the year ended December 31, 2020.

On July 14, 2021 the Company acquired Zipwhip, Inc.

Management excluded Zipwhip from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2021.

Zipwhip's total assets excluded from this assessment was $51.9 million, representing 0.4% of the Company’s consolidated total assets as of December 31, 2021, and Zipwhip's total revenue of $55.4 million represented 2% of the Company’s consolidated revenue for the year ended December 31, 2021.

The effectiveness of our internal control over financial reporting as of December 31, 2021 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report which is included in Part II, Item 8, “Financial Statements and Supplementary Data”, of this Annual Report on Form 10-K.

On November 2, 2020, the Company acquired Segment.

As a result of this acquisition, the Company is reviewing the internal controls of Segment and is making appropriate changes as deemed necessary.

Except for the changes in internal controls related to Segment, there were no changes in our internal control over financial reporting 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 December 31, 2020 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

On July 14, 2021, the Company acquired Zipwhip.

As a result of this acquisition, the Company is reviewing the internal controls of Zipwhip and is making appropriate changes as deemed necessary.

Except for the changes in internal controls related to Zipwhip, there were no changes in our internal control over financial reporting 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 December 31, 2021, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

(d) Inherent Limitations on Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, 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.

Our management, including our Chief Executive Officer and our Principal Financial Officer, 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.

5 unchanged sentences

Not applicable.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

Directors, Executive Officers and Corporate Governance

27 unchanged sentences

Exhibit Filing Date

2.1+ Agreement and Plan of Merger and Reorganization, dated October 15, 2018, by and among Twilio Inc., a Delaware corporation, SendGrid, Inc., a Delaware corporation, and Topaz Merger Subsidiary, Inc., a Delaware corporation

8-K 011-37806 2.1 October 16, 2018

2.2 First Amendment to Agreement and Plan of Merger and Reorganization, dated December 13, 2018, by and among Twilio Inc., a Delaware corporation, SendGrid, Inc., a Delaware corporation, and Topaz Merger Subsidiary, Inc., a Delaware corporation

10-K 001-37806 2.2 March 1, 2019

2.1 Agreement and Plan of Merger and Reorganization, dated as of May 16, 2021, by and among Twilio Inc., a Delaware corporation, Zeus Merger Sub I, Inc., a Delaware corporation, Zeus Merger Sub II, LLC, a Delaware limited liability company, Zipwhip, Inc., a Delaware corporation and Fortis Advisors LLC, a Delaware limited liability company

10-Q 001-37806

2.1 July 30, 2021

2.2 Agreement and Plan of Reorganization, dated October 12, 2020, by and among Twilio Inc., a Delaware corporation, Scorpio Merger Sub, Inc., a Delaware corporation, Segment,io, Inc., a Delaware corporation, and Shareholder Representative Services LLC, a Colorado limited liability company

2.1 November 5, 2020

2.3 Framework Agreement Letter Agreement , dated as of August 16, 2021 , by and among Twilio Inc., a Delaware corporation, Carlyle Partners V Holdings, L.P.

, a Delaw are limited partnership, and Syniverse Corp oration, a Delaware corporation

8-K 001-37806 2.1 August 17, 2021

3.1 Amended and Restated Certificate of Incorporation of Twilio Inc.

12 unchanged sentences

8-K 001-37806 4.2 May 18, 2018

4.5 Indenture, dated as of March 9, 2021 by and between Twilio Inc.

Bank National Association, as Trustee

8-K 001-37806 4.1 March 9, 2021

4.6 First Supplemental Indenture, dated as of March 9, 2021, between Twilio Inc .

Bank National Association, as Trustee

8-K 001-37806 4.2 March 9, 2021

4.7 Form of 3.625% Senior Notes due 2029

8-K 001-37806 4.3 March 9, 2021

4.8 Form of 3.875% Senior Notes due 2031

8-K 001-37806 4.4 March 9, 2021

4.9 Description of the Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

Filed herewith

10-K 001-37806 4.5 February 26, 2021

10.1* Form of Indemnification Agreement

Filed herewith

10-K 001-37806 10.1 February 26, 2021

Amended and Restated 2008 Stock Option Plan and forms of Stock Option Agreement and form of Stock Option Grant Notice

Filed herewith

10-K 001-37806 10.2 February 26, 2021

Amended and Restated 2016 Stock Option and Incentive Plan, and forms of Agreements thereunder

Filed herewith

10-K 001-37806 10.3 February 26, 2021

10.4* Twilio Inc.

3 unchanged sentences

Fifth Amended and Restated 2013 Stock Option and Grant Plan and related form agreements

Filed herewith

10-K 001-37806 10.5 February 26, 2021

10.6* SendGrid, Inc.

Amended and Restated 2012 Equity Incentive Plan

Filed herewith

10-K 001-37806 10.6 February 26, 2021

10.7* SendGrid, Inc.

Amended and Restated 2017 Equity Incentive Plan

Filed herewith

10-K 001-37806 10.7 February 26, 2021

10.8* Twilio Inc.

1 unchanged sentence

10-Q 001-37806 10.1 October 31, 2019

10.9* Zipwhip, Inc.

2018 Equity Incentive Plan

S-8 333-211634 99.1 August 2, 2021

10.10* Zipwhip, Inc.

Amended and Restated 2008 Stock Plan

S-8 333-211634 99.2 August 2, 2021

10.11 Office Lease, dated January 8, 2016, as amended January 8, 2016, between Twilio Inc.

7 unchanged sentences

10-Q 001-37806 10.2 November 8, 2018

10.12* Offer letter with George Hu, dated February 28, 2017

8-K 001-37806 10.1 March 3, 2017

10.13* Offer letter with Khozema Shipchandler, dated August 20, 2018

10.14* Offer L etter with Khozema Shipchandler, dated August 20, 2018

8-K 001-37806 10.1 October 25, 2018

10.15* Offer Letter with Marc Boroditsky, dated October 25, 2021

Filed herewith

10.16* Offer Letter with Eyal Manor, dated October 13, 2021

Filed herewith

10.17* Offer Letter with Dana Wagner dated October 7 , 2021

Filed herewith

10.18* Chief Executive Officer Severance Plan dated March 28, 2018 and form of participation letter

10-Q 001-37806 10.1 May 10, 2018

10.15* Key Executive Severance Plan, dated March 28, 2018 and form of participation letter

10.19* Key Executive Severance Plan, dated March 28, 2018 and F orm of P articipation L etter

10-Q 001-37806 10.2 May 10, 2018

1 unchanged sentence

8-K 001-37806 10.1 May 18, 2018

21.1 List of subsidiaries of the Registrant

10.21+† Framework Agreement by and among Twilio Inc., a Delaware corporation, Carlyle Partners V Holdings, L.P., a Delaware limited partnership, and Syniverse Corporation, a Delaware corporation, dated as of February 26, 2021

10-Q 001-37806 10.1 May 6, 2021

21.1 List of S ubsidiaries of the Registrant

Filed herewith

3 unchanged sentences

Filed herewith

31.2 Certification of the Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 Certification of the Chief Operating Officer (Principal Financial Officer) pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Filed herewith

32.1** Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.

32.1** Certification of the Chief Executive Officer and Chief Operating Officer (Principal Financial Officer ) pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

15 unchanged sentences

The registrant hereby undertakes to furnish supplemental copies of any of the omitted schedules and other similar attachments upon request by the Securities and Exchange Commission.

† Certain portions of this exhibit have been omitted because they are not material and they are the type of information that the registrant treats as private or confidential.

* Indicates a management contract or compensatory plan or arrangement.

5 unchanged sentences

February 22, 2022 /s/ KHOZEMA Z.

Chief Financial Officer (Principal Accounting and Financial Officer)

Chief Operating Officer (Principal Accounting and Financial Officer)

February 22, 2022 /s/ RICHARD L.

2 unchanged sentences

February 22, 2022 /s/ DONNA L.

February 25, 2021 /s/ JEFFREY EPSTEIN

Jeffrey Epstein

February 22, 2022 /s/ JEFF EPSTEIN

February 22, 2022 /s/ JEFFREY R.

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures