What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-02-22 compared with 2023-02-28 · 284 added, 200 removed, 576 unchanged (46% of the section changed)

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Reports of Independent Registered Public Accounting Firm (PCAOB ID No.

Report of Independent Registered Public Accounting Firm (PCAOB ID No.

Consolidated Balance Sheets

Consolidated Statements of Comprehensive Income

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Stockholders’ Equity

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We have audited the accompanying consolidated balance sheets of eXp World Holdings, Inc.

and subsidiaries (the "Company") as of December 31, 2022 and 2021, the related consolidated statements of comprehensive income, equity, and cash flows, for each of the three years in the period ended December 31, 2022, and the related notes (collectively referred to as the "financial statements").

and subsidiaries (the "Company") as of December 31, 2023 and 2022, the related consolidated statements of comprehensive (loss) income, stockholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Commissions and Other Agent-Related Costs – Revenue share expenses – Refer to Note 2 to the financial statements

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o We tested the accuracy of the FLQA count for agents and brokers by reading independent contractor agreements and obtained evidence of agents and brokers reaching the required sales transaction volume, including settlement statements.

Commitments and Contingencies — Refer to Note 13 to the financial statements.

Critical Audit Matter Description

The Company is among several defendants in numerous putative class action lawsuits alleging that the Company participated in a system that resulted in sellers of residential property paying inflated buyer broker commissions in violation of U.S.

federal and state antitrust laws, as well as a case brought in Canada (“antitrust litigation”).

The Company reviews loss contingencies to determine the likelihood of loss and to assess whether a reasonable estimate of the loss or range of loss can be made.

The Company recognizes expenses for legal claims when a loss is considered probable and reasonably estimable.

If it is reasonably possible that a loss may have been incurred and the effect on the financial statements could be material, the Company discloses an estimate of the possible loss or range of loss or a statement that such an estimate cannot be made within the notes to the financial statements.

The Company has determined that it is reasonably possible that a loss associated with the antitrust litigation has occurred;

however, the loss or range of loss is not reasonably estimable and no provision for loss was recorded as of December 31, 2023.

We identified the antitrust litigation as a critical audit matter because of the challenges in auditing management's judgments applied in determining the likelihood of loss related to the resolution of such litigation, as well as the judgment in determining whether potential loss associated with the antitrust litigation is reasonably estimable.

Specifically, auditing management's determination of whether any contingent loss arising from the antitrust litigation is probable, reasonably possible, or remote, and the related disclosures, is subjective and requires significant judgment due to the uncertainties involved, together with the novelty and complexity of the issues.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures performed related to antitrust litigation and claims included the following, among others:

● We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over management’s evaluation of the antitrust litigation, including controls related to the Company's assessment of the accounting and related disclosures based on the most recent facts and circumstances.

● We inquired of the Company's internal and external legal counsel, as well as executives and other members of management, to understand the basis for the Company's accounting conclusions related to the antitrust litigation.

● We requested and received written responses from internal and external legal counsel.

● We evaluated management's analysis of antitrust litigation.

● We examined Board of Directors meeting minutes, including relevant sub-committee meeting minutes, and compared to written responses received from internal and external counsel.

● We made inquiries of management and the audit committee to evaluate and corroborate our understanding obtained through inquiries of internal and external legal counsel.

We also performed public domain searches for evidence contrary to management's analysis.

● We compared the Company's assessment of this matter to relevant history of similar legal contingencies that have been settled or otherwise resolved to evaluate the consistency of the Company's assessment of antitrust litigation.

● We consulted with our accounting experts to assist in our evaluation of the case facts and the Company's related accounting treatment for the antitrust litigation.

● We obtained written representations from executives of the Company.

● We obtained and reviewed the class action complaints, relevant court rulings, and terms related to other settlements of similar or related antitrust litigation.

● We evaluated the Company's financial statement disclosure for consistency with the audit evidence obtained on the antitrust litigation matter.

● We evaluated events subsequent to December 31, 2023, that might impact our evaluation of the antitrust litigation, including any related accrual or disclosure.

/s/ Deloitte & Touche LLP

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EXP WORLD HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(In thousands, except share amounts and per share data)

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Sales and marketing expenses

Impairment expense

Total operating expenses

Operating income

Operating (loss) income

Other (income) expense

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Equity in losses of unconsolidated affiliates

Total other expense, net

Income before income tax expense

Total other (income) expense, net

Income (loss) before income tax expense

Income tax (benefit) expense

Net income attributable to noncontrolling interest

Net income attributable to eXp World Holdings, Inc.

Earnings per share

Net (loss) income

Net (loss) income attributable to noncontrolling interest

Net (loss) income attributable to eXp World Holdings, Inc.

(Loss) earnings per share

Weighted average shares outstanding

Comprehensive income:

Comprehensive loss attributable to noncontrolling interests

Net income attributable to eXp World Holdings, Inc.

Other comprehensive income:

Comprehensive (loss) income:

Net (loss) income

Comprehensive (loss) income attributable to noncontrolling interests

Net (loss) income attributable to eXp World Holdings, Inc.

Other comprehensive (loss) income:

Foreign currency translation gain (loss), net of tax

Comprehensive income attributable to eXp World Holdings, Inc.

Comprehensive (loss) income attributable to eXp World Holdings, Inc.

The accompanying notes are an integral part of these consolidated financial statements.

EXP WORLD HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

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Repurchases of common stock

Issuance of treasury stock

Issuance of treasury stock, for acquisition

Balance, end of period

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Balance, end of period

Accumulated earnings (deficit):

Accumulated earnings:

Balance, beginning of period

Dividends declared and paid

Net (loss) income attributable to eXp World Holdings, Inc.

Dividends declared and paid ( $ 0.05 , $ 0.045 and $ 0.04 per share of common stock beginning with Q3 2023, Q3 2022 and Q4 2021, respectively)

Balance, end of period

Accumulated other comprehensive income:

Accumulated other comprehensive income (loss):

Balance, beginning of period

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OPERATING ACTIVITIES

Net (loss) income

Reconciliation of net income to net cash provided by operating activities:

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Amortization expense - long-term payable

Asset impairments

Loss on dissolution of consolidated affiliates

Impairment expense

Loss on disposition of business

Allowance for credit losses on receivables/bad debt on receivables

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INVESTING ACTIVITIES

Purchases of property, plant and equipment

Acquisition of businesses, net of cash acquired

Purchases of property, plant, equipment

Proceeds from sale of business

Acquisition of business, net of cash acquired

Investments in unconsolidated affiliates

Capitalized software development costs in intangible assets

NET CASH USED IN INVESTING ACTIVITIES

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SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Termination of lease liabilities

Issuance of treasury stock

Termination of lease obligation - operating lease

Issuance of treasury stock, for acquisition

Lease liabilities arising from obtaining right-of-use assets

Contingent consideration for disposition of business

Property, plant and equipment increase due to transfer of right-of-use lease asset

Property, plant and equipment purchases in accounts payable

Liabilities incurred associated with a business acquisition

Liabilities assumed in business acquisition

The accompanying notes are an integral part of these consolidated financial statements.

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Specifically, we operate a cloud-based real estate brokerage (in North America and other international locations), a Virbela business and related affiliated services that support the development and success of agents, entrepreneurs and businesses by leveraging innovative technologies and integrated services.

Our North American and international real estate brokerage is now one of the largest and fastest-growing real estate brokerage companies, operating throughout the United States, most of the Canadian provinces, the United Kingdom (U.K.), Australia, South Africa, India, Mexico, Portugal, France, Puerto Rico, Brazil, Italy, Hong Kong, Colombia, Spain, Israel, Panama, Germany, the Dominican Republic, Greece, New Zealand, Chile and Poland.

In addition, in late 2022, we announced operations in Dubai, which is expected to be fully operational in 2023.

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles and are expressed in U.S.

Our North American and international real estate brokerage is now one of the largest and fastest-growing real estate brokerage companies, operating throughout the United States, most of the Canadian provinces, the U.K., Australia, South Africa, India, Mexico, Portugal, France, Puerto Rico, Brazil, Italy, Hong Kong, Colombia, Spain, Israel, Panama, Germany, the Dominican Republic, Greece, New Zealand, Chile, Poland and Dubai.

The accompanying consolidated financial statements have been prepared in accordance with U.S.

generally accepted accounting principles (“U.S.

GAAP”) and are expressed in U.S.

The Company’s fiscal year end is December 31.

Effective in December 2022, the Company revised the presentation of segment information to reflect changes in the way the Company manages and evaluates the business.

As such, we now report operating results through four reportable segments:

North American Realty, International Realty, Virbela and Other Affiliated Services, as further discussed in Note 14 – Segment Information .

Accordingly, certain amounts in the prior years’ consolidated financial statements have been revised to conform to the current year presentation.

See additional information in Note 14 –Segment Information .

We report operating results through four reportable segments:

North American Realty, International Realty, Virbela and Other Affiliated Services, as further discussed in Note 10 – Segment Information to the consolidated financial statements included elsewhere in this Annual Report.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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Intercompany transactions and balances are eliminated upon consolidation.

Variable interest entities and noncontrolling interests

Variable interest entities (“VIEs”)

A company is deemed to be the primary beneficiary of a VIE and must consolidate the entity if the company has both:

(i) the power to direct a VIE’s activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE.

In 2019, the Company made capital contributions in consideration for an ownership interest in First Cloud Investment Group, LLC (“First Cloud”), a Nevada limited liability company providing mortgage origination for end-consumers, with the remaining ownership interests held by certain independent agents and brokers.

Under the terms of the operating agreement, the Company maintains at least a 50 % equity ownership interest in First Cloud.

The Company determined that First Cloud is a variable interest entity (“VIE”), as the Company is the primary beneficiary that has both the power to direct the activities that most significantly impact the VIE and a variable interest that potentially could be significant to the VIE.

The Company treats the interest in First Cloud that it does not own as a noncontrolling interest.

The noncontrolling interest balance is adjusted each period to reflect the allocation of net income and other comprehensive income attributable to the noncontrolling interest, as shown in the consolidated statements of comprehensive income.

The noncontrolling interest balance in the consolidated balance sheets represents the proportional share of the equity of the joint venture entity, which is attributable to the noncontrolling shareholders.

As of December 31, 2022, First Cloud’s operations have ceased and are not material to the Company’s financial position or results of operations.

Joint ventures

A joint venture is a contractual arrangement whereby the Company and other parties undertake an economic activity through a jointly controlled entity.

Joint control exists when strategic, financial and operating policy decisions relating to the activities

require the unanimous consent of the parties sharing control.

Joint control exists when strategic, financial and operating policy decisions relating to the activities require the unanimous consent of the parties sharing control.

Joint ventures are accounted for using the equity method and are recognized initially at cost.

Joint ventures are typically included in the Other Affiliated Services unless the joint venture specifically supports one of the reportable segments.

The Company has investments in a joint venture, Silverline Title & Escrow, LLC (“Silverline”), which operates and manages a title agency that performs, among other functions, core title agent services (for which liabilities arises), including the evaluation of searches to determine the insurability of title, the clearance of underwriting objections, the actual issuance of policies on behalf of insurance companies and, where customary, the issuance of title commitments and the conducting of title searchers.

As of December 31, 2022, Silverline’s operations were wound down in preparation for dissolution in 2023.

In July 2021, the Company entered into a joint venture with Kind Partners, LLC, a subsidiary of Kind Lending, LLC, forming SUCCESS Lending, LLC (“SUCCESS Lending”), a residential mortgage service company.

None of these joint venture investments are consolidated and the Company recognizes its share of income and expenses and equity movement in the joint ventures in proportion to their percentage of ownership.

As of December 31, 2022, Silverline and SUCCESS Lending’s operations are not material to the Company’s financial position or results of operations.

The Company has several joint venture investments.

As of December 31, 2023, the operations of these joint ventures are not material to the Company’s financial position or results of operations.

Use of estimates

The preparation of financial statements in conformity with U.S.

generally accepted accounting principles (“U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

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The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.

The actual results experienced by the Company may differ materially and adversely from the Company’s estimates.

The actual results experienced by the Company

may differ materially and adversely from the Company’s estimates.

To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

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When necessary, the Company will reclassify certain amounts in prior period financial statements to conform to the current period’s presentation.

No material reclassifications occurred during the current period.

In 2023, the Company reclassified certain amounts in the reconciliation of the provision for income taxes and deferred tax assets in Note 12 – Income Taxes .

These reclassifications had no effect on the provision for tax or deferred tax assets that were previously reported.

No other reclassifications occurred during the current period.

Cash and cash equivalents

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Once the cash is transferred from escrow, the Company reduces the respective customers’ deposit liability.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same such amounts shown on the statement of cash flows.

December 31,2021

December 31,2020

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash, beginning balance

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same amounts shown on the statement of cash flows.

December 31, 2023

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The Company recognizes recoveries as a decrease to the allowance for expected credit losses.

During 2022, given the changes in the real estate markets, the Company increased its allowances for expected credit losses, for real estate transactions, to better reflect the collection rates on certain of the aging receivable balances in 2022.

In 2023, the Company has decreased its allowances for expected credit losses, for real estate transactions, due to a decrease of the aging receivable balances, as a result of improvement in accounts receivable management.

As of December 31, 2023 and 2022, receivables from real estate property settlements totaled $ 81,004 and $ 79,135 , respectively, of which the Company recognized expected credit losses of $- and $ 3,127 as of December 31, 2023 and 2022, respectively.

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Lease payments on short-term leases and low-value leases are recognized as expenses on a straight-line basis over the lease term.

Refer to Note 10 – Leases for more information.

Goodwill represents the excess of the consideration paid over the estimated fair value of assets acquired and liabilities assumed in a business combination.

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In addition to the annual impairment evaluation, the Company evaluates at least quarterly whether events or circumstances have occurred in the period subsequent to the annual impairment testing which indicate that it is more likely than not an impairment loss has occurred.

The Company did no t recognize any impairments for either of the years ended December 31, 2022 and 2021.

The Company recognized goodwill impairment of $ 8,248 for the year ended December 31, 2023 related to Virbela.

The Company did no t recognize any impairment of goodwill for the years ended December 31, 2022 and 2021.

Intangible assets

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The Company evaluates its intangible assets for recoverability and potential impairment, or as events or changes in circumstances indicate the carrying value may be impaired.

The Company recognized no impairment for the year ended December 31, 2022 and 2021.

The Company recognized impairment related to the trade name and customer relationships of $ 955 for the year ended December 31, 2023, related to Virbela.

The Company did no t recognize any impairment of intangible assets for the years ended December 31, 2022 and 2021.

Software development costs

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Our stock-based compensation is comprised of employee equity incentives, agent growth incentive programs, agent equity program and stock option awards.

Stock-based compensation is more fully disclosed in Note 10 – Stockholders’ Equity.

Stock-based compensation is more fully disclosed in Note 9 – Stockholders’ Equity to the consolidated financial statements included elsewhere in this Annual Report.

The Company accounts for stock-based compensation granted to employees and non-employees using a fair value method.

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The Company is contractually obligated to provide services for the fulfillment of transfers of residential real estate between buyers and sellers.

The Company provides these services itself and controls the services necessary to legally transfer the residential real estate.

The Company provides these services itself and controls the services necessary to legally transfer residential real estate.

Correspondingly, the Company is defined as the principal.

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The Company estimates and accrues revenue to which it is entitled to for closed transactions but has yet to receive all the necessary closing documents.

Revenue is derived from assisting home-buyers and sellers in listing, marketing, selling and finding residential real estate.

The accrual for estimated revenue was immaterial for the years ended December 31, 2023 and 2022.

Revenue is derived from assisting homebuyers and sellers in listing, marketing, selling and finding residential real estate.

Commissions earned on real estate transactions are recognized at the completion of a residential real estate transaction once the Company has satisfied the performance obligation.

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The vast majority of the Company’s revenue is derived from providing real estate brokerage services, to purchasers and sellers of homes in the U.S., Canada and internationally.

See Note 14 – Segment Information for details regarding segment and geographic information.

See Note 10 – Segment Information to the consolidated financial statements included elsewhere in this Annual Report for details regarding segment and geographic information.

Management provides disaggregation of revenue from its services to customers to provide additional insight into the future recognition of revenue and cash flows.

Revenue share expenses

The Company has a revenue sharing plan where its agents and brokers can receive additional commission income from real estate transactions consummated by agents and brokers they have attracted to the Company.

Agents and brokers are eligible for revenue share based on the number of frontline qualifying active (“FLQA”) agents they have attracted to the Company.

An FLQA agent is an agent or broker that an agent has personally attracted to the Company who has met specific real estate transaction volume requirements.

These additional commissions are earned on a multitiered basis by FLQA agents and brokers for real estate transactions within their downstream brokerage network.

Commissions to agents and brokers under the revenue sharing plan are included as part of commissions and other agent-related costs in the consolidated statements of comprehensive income.

Sustainable Revenue Share Plan expenses

The Company’s costs incurred under the Revenue Share Plan are included as commissions and other agent-related costs in the consolidated statements of comprehensive income.

Advertising and marketing costs

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(i) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority.

Comprehensive income

The Company’s only components of comprehensive income are net income and foreign currency translation adjustments.

Comprehensive (loss) income

The Company’s only components of comprehensive (loss) income are net (loss) income and foreign currency translation adjustments.

Earnings per share

Basic earnings (loss) per share is computed by dividing the net income for the period by the weighted average number of shares of common stock outstanding during the period.

Diluted earnings (loss) per share is computed by dividing net income for the period by the weighted average number of shares of common stock outstanding plus, if potentially dilutive common

shares outstanding during the period.

Basic earnings (loss) per share is computed by dividing the net (loss) income for the period by the weighted average number of shares of common stock outstanding during the period.

Diluted earnings (loss) per share is computed by dividing net (loss) income for the period by the weighted average number of shares of common stock outstanding plus, if potentially dilutive common shares outstanding during the period.

The Company has paid dividends in 2023, 2022 and 2021.

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The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting standards that have been issued that might have a material impact on its financial position and results of operations.

The following discussion relates to acquisitions completed during the year ended December 31, 2022.

There were no acquisitions completed during the fiscal year ended December 31, 2021.

None of these business combinations were deemed material to the Company’s financial condition, results of operations, or cash flows.

Zoocasa Realty, Inc.

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07 – Segment Reporting (Topic 280) (“ASU 2023-07”).

ASU 2023-07 improves reportable segment disclosure requirements, primarily through enhanced disclosure about significant segment expenses.

The amendments in this update require, among other things, that a public company disclose on an annual and interim basis significant segment expense, as well as other segment expenses, that are regularly provided to the CODM.

The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, early adoption is permitted.

The Company is currently evaluating the effect the amendments in ASU 2023-07 will have on its segment disclosures.

In December 2023, the FASB issued ASU 2023-09 – Income Taxes (Topic 740) (“ASU 2023-09”).

ASU 2023-09 improves reporting for income taxes, primarily by requiring disclosure of specific categories in the tax rate reconciliation and providing additional annual information for reconciling items that meet a quantitative threshold.

The amendments in ASU 2023-09 also require additional annual information regarding income taxes paid, as well as other additional disclosures.

The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, early adoption is permitted.

The Company is currently evaluating the effect the amendments in ASU 2023-09 will have on its tax disclosures.

The Company did not complete any acquisitions during the year ended December 31, 2023.

On July 1, 2022, the Company acquired Zoocasa Realty Inc.

in a stock purchase transaction.

The total consideration paid was $ 17,155 including net cash of $ 9,910 (net of cash acquired of $ 2,772 ), stock issued from treasury of $ 4,554 and the working capital adjustment.

The total consideration paid was $ 17,155 including net cash of $ 9,910 (net of cash acquired of $ 2,772 ), stock issued from treasury of $ 4,554 and a working capital adjustment.

The Zoocasa acquisition has been accounted for using the acquisition method of accounting.

Under the acquisition method of accounting, the Company allocated the total purchase price to the tangible and identifiable intangible assets acquired and assumed liabilities based on their estimated fair values as of the acquisition date, as determined by management.

The excess of the purchase price over the aggregate fair values of the identifiable assets was recorded as goodwill of $ 14,156 , which is not deductible for tax purposes.

Goodwill generated from the acquisition includes an assembled workforce.

Zoocasa is a consumer real estate research portal that offers proprietary home search tools, market insights and a connection to local real estate experts and has been included in the North American Realty segment.

The following table outlines the fair value of the acquired assets and liabilities assumed from the Zoocasa acquisition:

Identifiable assets acquired and goodwill

Accounts receivable, net

Prepaid & other current assets

Fixed assets, net

Zoocasa tradename

Existing technology

Liabilities assumed

Deferred liabilities & other current liabilities

Total purchase price

FAIR VALUE MEASUREMENT

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Total goodwill

Goodwill was recorded in connection with the acquisitions of Zoocasa in July 2022, Showcase in July 2020 and SUCCESS in December 2020 and represents fair value as of the acquisition dates.

Each acquisition was accounted for using the acquisition method of accounting.

During the fourth quarter of 2023, as part of the Company’s annual goodwill impairment assessment, the Company determined that the goodwill associated with Virbela, the Company’s technology segment was impaired.

During the impairment evaluation, the Company determined that the projection for future cash flows associated with Virbela had declined significantly resulting from the post-COVID 19 work environment of return to the office and hybrid work initiatives globally, as well as the increase in the demand for artificial intelligence solutions.

The Company determined the estimated fair value of Virbela using the market approach, which measures value based on what other purchasers in the market have paid for assets or business interests that can be considered reasonably similar to Virbela.

Based on that approach, the estimated fair value was significantly lower than the book value of Virbela and the goodwill associated with Virbela was impaired.

The Company recognized an impairment charge of $ 8,248 for the year ended December 31, 2023.

During 2023, the Company disposed of its Showcase Web Sites LLC business, which resulted in a reduction of goodwill of $ 2,310 , this business was included in the North American Realty segment.

Goodwill was recorded in connection with the acquisition of Zoocasa in July 2022 and represents fair value as of the acquisition date.

The acquisition was accounted for using the acquisition method of accounting.

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Additionally, if current assumptions and estimates, including projected revenues and income growth rates, terminal growth rates, competitive and consumer trends, market-based discount rates and other market factors, are not met, or if valuation factors outside of the Company’s control change unfavorably, the estimated fair value of goodwill could be adversely affected, leading to a potential impairment in the future.

No events occurred that indicated it was more likely than not that goodwill was impaired.

Definite-lived intangible assets were as follows:

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For the years ended December 31, 2023, 2022 and 2021, amortization expense for definite-lived intangible assets was $ 2,540 , $ 1,904 and $ 1,274 , respectively.

As part of the Company’s annual assessment, the Company also reviews the useful lives of its amortizable intangible assets and determines if there should be any change to the amortization period.

For the amortizable assets related to the Virbela segment, the Company determined that the trade name and the customer relationships that were recognized as part of the acquisition, should be fully amortized as of December 31, 2023.

This assessment was made based on the future negative operating cash flows and the decline in the estimated fair value of Virbela.

As a result, the Company recognized an impairment loss related the net book value of the trade name of $ 585 and customer relationships $ 370 .

As of December 31, 2023, expected amortization related to definite-lived intangible assets will be:

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Other accrued expenses

Operating leases

The Company’s lease portfolio consists of office leases with lease terms ranging from less than one year to seven years , with the weighted average lease term being seven years .

Certain leases provide for increases in future lease payments once the term of the lease has expired, as defined in the lease agreements.

These leases generally also include real estate taxes.

As of December 31, 2022, maturities of the operating lease liabilities by fiscal year were as follows:

Period Ending December 31,

2028 and thereafter

Total lease payments

Total operating lease liabilities

Included below is other information regarding leases for the year ended December 31, 2022:

Year Ended December 31,

Other information

Operating lease expense

Short-term lease expense

Cash paid for operating leases

Weighted-average remaining lease term (years) – operating leases (1)

Weighted-average discount rate – operating leases

(1) The Company’s lease terms include options to extend the lease when it is reasonably certain the Company will exercise its option.

Additionally, the Company considered any historical and economic factors in determining if a lease renewal or termination option would be exercised.

Rent expense is recorded in general and administrative expense in the consolidated statements of comprehensive income.

STOCKHOLDERS’ EQUITY

Common Stock – As of December 31, 2023, our restated certificate of incorporation authorized us to issue 900,000,000 shares of common stock with a par value of $ 0.00001 per share.

The following table represents a reconciliation of the Company’s issued common stock for the periods presented:

The following table represents a reconciliation of the Company’s issued common stock shares for the periods presented:

Year Ended December 31,

(Shares of Common Stock)

Common stock:

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Balance, end of year

The Company’s shareholder approved equity programs described below are administered under the 2015 Equity Incentive Plan.

The Company’s stockholder approved equity programs described below are administered under the 2015 Equity Incentive Plan.

The purpose of the equity plan is to retain the services of valued employees, directors, officers, agents and consultants and to incentivize such persons to make contributions to the Company and motivate excellent performance.

Agent Equity Program

The Company provides agents and brokers the opportunity to elect to receive 5 % of commissions earned from each completed residential real estate transaction in the form of common stock (the “Agent Equity Program” or “AEP”).

If agents and brokers elect to receive portions of their commissions in common stock, they are entitled to receive the equivalent number of shares of common stock, based on the fixed monetary value of the commission payable.

Prior to January 1, 2020, the Company recognized a 20 % discount on these issuances as an additional cost of sales charge during the periods presented.

Effective in January 2020, the Company amended the AEP and adjusted the discount on issued shares from 20 % to 10 %.

For the years ended December 31, 2023, 2022 and 2021, the Company issued 8,897,804 , 11,462,940 and 3,645,386 shares of common stock, respectively, to agents and brokers for $ 135,226 , $ 164,104 and $ 144,437 , respectively, net of discount.

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The total amount of stock compensation attributable to liability classified awards was $ 3,832 , $ 2,056 and $ 4,977 for the years ended December 31, 2023, 2022 and 2021, respectively.

Stock compensation expense related to the AGIP is included in general and administrative expense in the consolidated statements of comprehensive income.

The following table illustrates changes in the Company’s stock compensation liability for the periods presented:

16 unchanged sentences

( 2,219,881 )

( 1,245,862 )

Balance, December 31, 2023

Agent Thrive Program

Announced in October 2023, the Thrive program provides a stock incentive to the individual team leaders of teams of culturally aligned teams that join the Company as part of the program.

After affiliating with the Company, the team leader becomes eligible to receive an award of the Company’s common stock through team performance benchmarks.

Awards typically vest after production benchmarks are reached and three years of subsequent service is provided to the Company.

Share-based performance awards are based on a fixed-dollar amount of shares based on the achievement of production metrics.

As such, the awards are classified as liabilities until the number of share awards becomes fixed once the production metric is achieved.

Stock Option Awards

21 unchanged sentences

( 2,083,016 )

Balance, December 31,2021

Balance at December 31, 2022

( 1,198,706 )

Balance, December 31,2022

Balance at December 31, 2023

Exercisable at December 31, 2023

Vested at December 31, 2023

Exercise Price

Range of stock option exercise prices at December 31, 2023:

8 unchanged sentences

In May 2022, the Board approved an increase to the total amount of its buyback program from $ 400.0 million to $ 500.0 million.

In June 2023, the Board approved an increase to the total amount of its buyback program from $ 500.0 million to $ 1.0 billion.

Purchases under the repurchase program may be made in the open market or through a 10b5-1 plan and are expected to comply with Rule 10b-18 under the Exchange Act, as amended.

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On September 27, 2022, the Board approved and the Company entered into, a form of second amendment to the Issuer Repurchase Plan, to decrease the monthly repurchases from $ 20.0 million of its common stock per month to $ 13.3 million, in anticipation of volume decreases in connection with the contraction in the real estate market.

On December 27, 2022, the Board approved and the Company entered into, a form of third amendment to the Issuer Repurchase Plan, to decrease the monthly repurchases from $ 13.3 million of its common stock per month to $ 10.0 million, in connection with ongoing contractions in the real estate market.

million, in connection with ongoing contractions in the real estate market.

On May 10, 2023, the Board approved and, on May 11, 2023, the Company entered into, a form of fourth amendment to the Issuer Repurchase Plan, to increase the monthly repurchase amounts during 2023 due to actual and projected changes in the Company’s cash and cash equivalents;

specifically, to permit purchases of up to:

(i) $ 17.0 million during May 2023, (ii) $ 22.0 million during June 2023, (iii) $ 18.67 million during any calendar month commencing July 1, 2023 through and including September 30, 2023, and (iv) $ 12.0 million during any calendar month commencing October 1, 2023 through and including December 31, 2023.

On June 26, 2023, the Board approved, and the Company entered into, a form of fifth amendment to the Issuer Repurchase Plan to increase the maximum aggregate buyback from $ 500.0 million to $ 1.0 billion in accordance with the repurchase program limit.

On November 17, 2023, the Board approved, and the Company entered into, a form of sixth amendment to the Issuer Repurchase Plan to reduce the monthly repurchase from (i) $ 12.0 million to $ 8.0 million during November 2023, (ii) from $ 12.0 million to $ 6.0 million during any calendar month commencing December 1, 2023 through and including June 30, 2024.

For accounting purposes, common stock repurchased under the stock repurchase programs is recorded based upon the settlement date of the applicable trade.

Such repurchased shares are held in treasury and are presented using the cost

Such repurchased shares are held in treasury and are presented using the cost method.

These shares are considered issued but not outstanding.

The following table shows the changes in treasury stock for the periods presented:

The following table shows the changes in treasury stock shares for the periods presented:

Year Ended December 31,

(Shares of Treasury Stock)

Treasury stock:

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Repurchases of common stock

Issuance of treasury stock

Forfeiture to treasury stock for acquisition

Issuance of treasury stock for acquisition

Balance, end of year

SEGMENT INFORMATION

Segment information aligns with how the Chief Operating Decision Maker (“CODM”), Glenn Sanford, Chief Executive Officer of eXp World Holdings, Inc.

and eXp Realty, LLC, a wholly owned subsidiary of the Company (“eXp Realty”) manages the business and allocates resources as four operating segments.

The Company determines an operating segment if a component (i) engages in business activities from which it earns revenues and incurs expenses, (ii) has discrete financial information and is (iii) regularly reviewed by the CODM.

Once operating segments are identified, the Company performs a quantitative analysis of the current and historic revenues and profitability for each operating segment, together with a qualitative assessment to determine if operating segments have similar operating characteristics.

We have four operating segments and four reportable segments.

The CODM uses revenues and Adjusted Segment EBITDA as key metrics to evaluate the operating and financial performance of a segment, identify trends affecting the segments, develop projections and make strategic business decisions.

Adjusted Segment EBITDA for the reportable segments is defined as operating profit (loss) plus depreciation and amortization and stock-based compensation expenses.

The Company’s four reportable segments as follows:

● North American Realty:

includes real estate brokerage operations in the United States and Canada, as well as lead-generation and other real estate support services provided in North America.

● International Realty:

includes real estate brokerage operations in all other international locations.

includes the enterprise application-based Virbela platform and web-based Frame platform and the support services offered by eXp World Technologies.

● Other Affiliated Services:

includes our SUCCESS ® Magazine and other smaller ventures.

The Company also reports corporate expenses, as further detailed below, as “Corporate and other” which include expenses incurred in connection with business development support provided to the agents as well as resources, including administrative, brokerage operations and legal functions.

All segments follow the same basis of presentation and accounting policies as those described throughout the Notes to the Audited Consolidated Financial Statements included herein.

The following table provides information about the Company’s reportable segments and a reconciliation of the total segment Revenues to consolidated Revenues and Adjusted Segment EBITDA to the consolidated operating profit (in thousands).

Financial information for the comparable prior periods presented have been revised to conform with the current year presentation.

Year Ended December 31,

North American Realty

International Realty

Other Affiliated Services

Revenues reconciliation:

Segment eliminations

Consolidated revenues

Adjusted EBITDA

Year Ended December 31,

North American Realty

International Realty

Other Affiliated Services

Corporate expenses and other

Consolidated Adjusted EBITDA

Operating (Loss) Profit Reconciliation:

Depreciation and amortization expense

Impairment expense

Stock compensation expense

Stock option expense

Consolidated operating (loss) profit

December 31, 2023

December 31, 2022

North American Realty

International Realty

Other Affiliated Services

Segment total

Corporate and other

Consolidated total

Geographical information

For the years ended December 31, 2023, 2022 and 2021 approximately 9 % , 9 % and 8 % , respectively, of the Company’s total revenue was generated outside of the U.S.

Long-lived assets held outside of the U.S.

were 14 % and 6 % as of December 31, 2023 and 2022, respectively.

The Company’s CODM does not use segment assets to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed.

EARNINGS PER SHARE

Basic earnings per share is computed based on net income attributable to eXp shareholders divided by the basic weighted-average shares outstanding during the period.

Basic earnings per share is computed based on net income attributable to eXp stockholders divided by the basic weighted-average shares outstanding during the period.

Dilutive earnings per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period.

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Year Ended December 31,

Net income attributable to common stock

Net (loss) income attributable to eXp World Holdings, Inc.

Weighted average shares - basic

2 unchanged sentences

Earnings per share:

Earnings per share attributable to common stock- basic

Earnings per share attributable to common stock- diluted

(Loss) earnings per share attributable to common stock- basic

(Loss) earnings per share attributable to common stock- diluted

For the years ended December 31, 2023, 2022 and 2021, total outstanding shares of common stock excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive were 4,361,775 , 1,000,421 and 102,880 , respectively.

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Prior year true up items

The Company has made certain prior year reclassifications to research and development credit, unrecognized tax benefit, share-based compensation and other categories to ensure consistency with current year presentation.

These reclassifications had no effect on total effective tax rate.

Deferred tax assets and liabilities consist of the following for the periods presented:

4 unchanged sentences

Accruals and Reserves

Intangibles & Research and Experimental Costs

Goodwill and Intangibles

Research and Experimental Costs

Research and Development Credit

Lease liability

Legal Settlement Accrual

Share-based compensation

5 unchanged sentences

Net deferred tax assets

Certain prior year deferred asset amounts have been reclassified for consistency with the current year presentation.

In prior year the Company reported nominal deferred tax asset balances for partnership basis difference, lease liability and legal settlement accruals, these balances were reported as part of accruals and reserves in 2023.

Further, in prior year research and experimental costs were reported combined with intangible assets, these costs were stated separately in 2023.

These reclassifications had no effect on gross and net deferred tax assets.

The Company accounts for deferred taxes under ASC Topic 740 – Income Taxes (“ASC 740”), which requires a reduction of the carrying amount of deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that such assets will not be realized.

5 unchanged sentences

As of December 31, 2023, the Company had federal, state and foreign net operating losses of approximately $ 125.8 million, $ 74.1 million and $ 12.9 million, respectively.

Out of the federal net operating loss, approximately $ 8.7 million will carry forward for 20 years and can offset 100% of future taxable income;

and $ 149.5 million carries forward indefinitely and can offset 80% of future taxable income.

The full amount of $ 125.8 million of federal net operating loss can be carried forward

indefinitely and can offset 80% of future taxable income.

Certain state and foreign net operating losses will carry forward for limited number of years and, if not utilized, will begin to expire in 2024.

As of December 31, 2023, the Company conducted an IRC Section 382 analysis with respect to its net operating loss carryforward and determined there was an immaterial limitation.

As of December 31, 2022, the Company had federal and California Research and Development credits of approximately $ 4.6 million and $ 0.6 million, respectively.

Federal credits can be carried forward for 20 years and will begin expiring in 2039.

The California credit can be carried forward indefinitely.

Undistributed earnings of the Company’s foreign subsidiaries are considered to be indefinitely reinvested and accordingly, no provision for applicable income taxes has been provided thereon.

1 unchanged sentence

As of December 31, 2023 the undistributed earnings of the Company's foreign subsidiaries could result in withholding taxes of approximately $ 0.8 million, if repatriated.

As of December 31, 2023, the Company had federal and California Research and Development credits of approximately $ 5.8 million and $ 0.9 million, respectively.

Federal credit can be carried forward 20 years and will begin to expire in 2039.

California credit can be carried forward indefinitely.

The Company maintains liabilities for uncertain tax positions.

6 unchanged sentences

Unrecognized tax benefits - end of year

The unrecognized tax benefits relate to Federal and California research and development credits in 2022 and 2021 and to state taxes in 2020.

The unrecognized tax benefits relate to Federal and California research and development credits in 2023, 2022, and 2021.

As of December 31, 2023, the total amount of unrecognized tax benefits that would affect the Company effective tax rate, if recognized, is $ 1,904 .

1 unchanged sentence

As of December 31, 2023, the Company accrued interest or penalties related to uncertain tax positions in the amount of $ 0 .

The Company does not expect any of the uncertain tax positions to reverse during the next 12 months.

The company does not expect of the uncertain tax position to reverse during the next 12 month.

During 2022 the Company completed its federal examination for 2019 with no change to the original filing.

There are no state tax examinations in progress nor has it had any state tax examinations since its inception.

There are no federal or state tax examinations in progress nor has it had any state tax examinations since its inception.

Because the Company has net operating loss carryforwards, there are open statutes of limitations in which federal taxing authorities may examine the Company's tax returns for all years from December 31, 2011 through the current period.

US State taxing authorities may examine the Company's tax return for all years from December 31, 2014 through the current period and foreign tax authorities may examine the Company’s tax return for all years from December 31, 2019 through the current period.

The Company is subject to a wide variety of tax laws and regulations across the jurisdictions where it operates.

Regulatory developments from the U.S.

or international tax reform legislation could result in an impact to the Company's effective tax rate.

The Company continues to monitor the Base Erosion and Profit Shifting (BEPS) Integrated Framework provided by the Organization for Economic Co-operation and Development (OECD) including the legislative adoption of Pillar II by countries, and all other tax regulatory changes, to evaluate the potential impact on future periods.

COMMITMENTS AND CONTINGENCIES

Contingencies

From time to time, the Company is subject to potential liability under laws and government regulations and various claims and legal actions that may be asserted against us that could have a material adverse effect on the business, reputation, results of operations or financial condition.

Such litigation may include, but is not limited to, actions or claims relating to sensitive data, including proprietary business information and intellectual property and that of clients and personally identifiable information of employees and contractors, cyber-attacks, data breaches and non-compliance with contractual or other legal obligations.

Litigation and other legal matters are inherently unpredictable and subject to substantial uncertainties and adverse resolutions could occur.

In addition, litigation and other legal matters, including class-action lawsuits, government investigations and regulatory proceedings can be costly to defend and, depending on the class size and claims, could be costly to settle.

The Company believes that its defenses and assertions in pending legal proceedings have merit and the Company believes that it has adequately and appropriately accrued for legal matters that are estimable.

However, substantial unanticipated judgments, penalties, sanctions, and fines do occur.

As a result, the Company could from time to time incur judgments, enter into settlements, or revise its expectations regarding the outcome of certain matters, and such developments could have a material

adverse effect on its results of operations in the period in which the amounts are accrued and/or its cash flows in the period in which the amounts are paid.

For the cases described below, management is currently unable to reasonably estimate the possible loss or range of possible loss because, among other reasons, (i) the proceedings are in preliminary stages, (ii) specific damage amounts have not been sought, (iii) damages sought are, in our opinion, unsupported and/or exaggerated, (iv) there is uncertainty as to the outcome of pending appeals or motions in these and similar lawsuits affecting the industry, (v) there are significant factual issues to be resolved;

and/or (vi) there are novel legal issues or unsettled legal theories presented.

For the matters described below, we have not recorded any accruals as of December 31, 2023.

However, the Company has determined that a material loss is reasonably possible in the near term, and facts could emerge through the course of the lawsuits that lead the Company to determine that a loss is estimable, resulting in an accrued liability that could be material.

Since October 31, 2023, the Company and/or its subsidiaries have been named as defendants in numerous putative class action complaints brought in various U.S.

district courts and the Federal Court of Canada relating to antitrust matters, which lawsuits are described below.

The following lawsuits, brought by putative classes of residential property sellers, allege that defendants participated in a system that resulted in sellers of residential property purportedly paying inflated buyer broker commissions in violation of federal and state antitrust laws, as applicable:

National Association of Realtors et.

al., Case No.

4:23-cv-00788-FJG (filed in the United States District Court for the Western District of Missouri, Western Division);

1925 Hooper LLC, et al.

The National Association of Realtors et.

al., Case No.

1:23-cv-05392- SEG (United States District Court for the Northern District of Georgia, Atlanta Division);

The National Association of Realtors, et al.

3:23-cv-06352 (United States District Court for the Northern District of California, San Francisco Division);

The National Association of Realtors et.

4:23-cv-00945 (United States District Court for the Western District of Missouri, Western Division);

Gael Fierro et al.

The National Association of Realtors, et al.

2:24-cv-00449 (United States District Court for the Central District of California);

Willsim Latham, LLC, et al.

MetroList Services, Inc., et al.

2:24-at-00067 (United States District Court for the Eastern District of California, Sacramento Division);

Kevin McFall v.

Canadian Real Estate Association, et al.

T-119-24-ID 1 (Federal Court of Canada);

and Nathaniel Whaley et al.

The National Association of Realtors, et al.

2:24-cv-00105 (United States District Court for the District of Nevada).

The following lawsuit, brought by a putative class of residential property buyers, alleges that defendants participated in a system that resulted in buyers of residential property purportedly paying inflated home prices as a result of sellers purportedly paying inflated buyer broker commissions in violation of federal and Illinois antitrust laws:

Compass, Inc., et.

al ., Case No.

1:23-cv-15618 (United States District Court for the Northern District of Illinois, Eastern Division).

The plaintiffs in these lawsuits seek a permanent injunction enjoining the defendants from requiring home sellers to pay buyer-broker commissions or from otherwise restricting competition among brokers, an award of declaratory relief and damages or restitution on behalf of certain home sellers or buyers, as applicable, in those states or provinces, as applicable, as well as attorneys’ fees and costs of suit.

Plaintiffs allege joint and several liability and seek treble or other multiple damages.

Each antitrust lawsuit is in the pleadings phase and the Company intends to vigorously defend against all claims.

The Company may become involved in additional litigation or other legal proceedings concerning the same or similar claims.

In March and April 2022, an indirect subsidiary and unconsolidated joint venture of the Company, SUCCESS Lending, entered into Mortgage Warehouse Agreements and related ancillary agreements (the “Credit Agreements”) with Flagstar Bank FSB and Texas Capital Bank, which each provide SUCCESS Lending with a revolving warehouse credit line of up to $ 25 million.

5 unchanged sentences

The Credit Agreements represent off-balance sheet arrangements for the Company.

There are no matters pending or, to the Company’s knowledge, threatened that are expected to have a material adverse impact on the business, reputation, results of operations, or financial condition.

There are no proceedings in which any of the Company’s directors, officers or affiliates, or any registered or beneficial stockholder is an adverse party or has a material interest adverse to the Company’s interest.

SEGMENT INFORMATION

In prior years, management made operating decisions and assessed performance based on product lines, with three operating segments and one single reportable segment.

In December of 2022, as a result of the growth in international operations and changes in the North American markets, the Company revised the presentation of segment information to align with changes to how the Chief Operating Decision Maker (“CODM”), Glenn Sanford, Chief Executive Officer of eXp World Holdings and eXp Realty, manages the business and allocates resources as four operating segments.

In December 2022, we determined that we have the four operating segments and four reportable segments.

Adjusted Segment EBITDA for the reportable segments is defined as operating profit (loss) plus depreciation and amortization and stock-based compensation expenses.

The Company’s four reportable segments as follows:

● North American Realty:

includes real estate brokerage operations in the United States and Canada, as well as lead-generation and other real estate support services provided in North America.

● International Realty:

includes real estate brokerage operations in all other international locations.

includes Virbela enterprise metaverse technology and the support services offered by eXp World Technologies.

● Other Affiliated Services which includes our SUCCESS ® Magazine and other smaller ventures.

All segments follow the same basis of presentation and accounting policies as those described throughout the Notes to the Audited Consolidated Financial Statements included herein.

The following table provides information about the Company’s reportable segments and a reconciliation of the total segment Revenues to consolidated Revenues and Adjusted Segment

EBITDA to the consolidated operating profit (in thousands).

Financial information for the comparable prior periods presented have been revised to conform with the current year presentation.

Year Ended December 31,

North American Realty

International Realty

Other Affiliated Services

Revenues reconciliation:

Segment eliminations

Consolidated revenues

Year Ended December 31,

North American Realty

International Realty

Other Affiliated Services

Corporate expenses and other

Consolidated Adjusted EBITDA

Operating Profit Reconciliation:

Depreciation and amortization expense

Stock compensation expense

Stock option expense

Consolidated operating profit

Geographical information

For the years ended December 31, 2022, 2021 and 2020 approximately 9 %, 8 % and 5 % , respectively, of the Company’s total revenue was generated outside of the U.S.

Long-lived assets held outside of the U.S.

were 6 % and 8 % as of December 31, 2022 and 2021, respectively.

The Company’s CODM does not use segment assets to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed.

DEFINED CONTRIBUTION SAVINGS PLAN

2 unchanged sentences

The Company matches a portion of contributions made by participating employees.

For the years ended December 31, 2022, 2021 and 2020, the Company's costs for contributions to this plan were $ 4,720 , $ 3,196 and $ 1,189 , respectively.

years ended December 31, 2023, 2022 and 2021, the Company's costs for contributions to this plan were $ 4,763 , $ 4,720 , and $ 3,196 , respectively.

SUBSEQUENT EVENTS

Quarterly Cash Dividend

On February 9, 2023 , our Board of Directors approved a cash dividend of $ 0.045 per common share to be paid on March 31, 2023 to shareholders of record on March 13, 2023 .The ex-dividend date is expected to be March 10, 2023.

On February 14, 2024 , our Board of Directors approved a cash dividend of $ 0.05 per common share to be paid on March 29, 2024 to stockholders of record on March 8, 2024 .The ex-dividend date is expected to be on or around March 7, 2024.

The dividend will be paid in cash.

Antitrust Litigation

The Company and certain of its subsidiaries were named in additional antitrust litigation after December 31, 2023;

specifically, the Fierro Litigation, the McFall Litigation, the Latham Litigation, the Whaley Litigation, and the Boykin Litigation.

The Boykin litigation was filed on February 16, 2024 as a putative class action complaint under the caption Boykin v.

The National Association of Realtors, et al.

2:24-cv-00340) in the United States District Court for the District of Nevada, naming as defendants the National Association of Realtors, certain regional Realtor associations, certain regional multiple listing services, certain real estate brokerages, and certain real estate brokerage owners, including eXp World Holdings, Inc.

The Boykin Litigation complaint alleges that defendants conspired to restrain trade by causing certain home sellers to pay buyer broker fees and inflated commissions on the sale of homes all in violation of federal antitrust laws and Nevada unfair trade practices laws.

The putative class representative seeks to represent a class of persons who paid a commission to a buyer’s broker in connection with the sale of a home from February 16, 2020, through the present.

Plaintiff, on behalf of herself and the putative class, seeks a permanent injunction enjoining the defendants from engaging in the alleged unlawful acts described in the Boykin Litigation complaint.

Plaintiff, on behalf of herself and the putative class, also seeks an award of declaratory relief, damages in an amount to be determined at trial, statutory interest and penalties, and attorneys’ fees, expenses and costs of suit.

See Note 13 – Commitments and Contingencies to the consolidated financial statements included elsewhere in this Annual Report for additional information about such litigation and other proceedings.

Agent Equity Program

Beginning March 1, 2024, agents and brokers may receive 5 % of commissions earned from each completed residential real estate transaction in the form of common stock at a 5 % discount recognized by the Company (which was previously 10 % discount on all AEP purchases before March 1, 2024).

Under the AEP, agents and brokers that have elected to receive portions of their commissions in common stock are entitled to receive the equivalent number of shares of common stock, based on the fixed monetary value of the commission payable.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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 8. Financial Statements and Supplementary Data