What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2023-03-31 compared with 2022-03-31 · 980 added, 849 removed, 1150 unchanged (61% of the section changed)

2 unchanged sentences

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

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

Consolidated Balance Sheets

6 unchanged sentences

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of AvePoint, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of AvePoint, Inc.

and subsidiaries (the " Company ") as of December 31, 2021, the related consolidated statements of operations, comprehensive loss, mezzanine equity and stockholders’

equity, and cash flows, for the year then ended, 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, 2021, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company's financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (" PCAOB ") and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ DELOITTE & TOUCHE LLP

We have served as the Company's auditor since 2021.

New York, New York

March 31, 2022

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Shareholders and the Board of Directors of AvePoint, Inc.

Jersey City, New Jersey

To the stockholders and the Board of Directors of AvePoint, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of AvePoint, Inc.

(the " Company ") as of December 31, 2020, the related consolidated statements of operations, comprehensive loss, mezzanine equity and stockholders’

deficiency, and cash flows for each of the two years in the period ended December 31, 2020, 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, 2020, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

and subsidiaries (the “Company”) as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive loss, mezzanine equity and stockholders’

equity, and cash flows, for each of the two years in the period ended December 31, 2022, 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, 2022 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Change in Accounting Principle

As discussed in Note 2 to the financial statements, the Company has changed its method of accounting for leases, effective January 1, 2022, due to the adoption of Accounting Standards Update No.

2016-02, Leases (Topic 842).

Basis for Opinion

6 unchanged sentences

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.

Accordingly, we express no such opinion.

2 unchanged sentences

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

We served as the Company's auditor from 2017 to 2021.

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

/s/ Deloitte & Touche LLP

New York, New York

March 10, 2021, except for the number of shares and per share amounts, as to which the date is March 31, 2022

March 31, 2023

We have served as the Company's auditor since 2021.

AvePoint, Inc.

11 unchanged sentences

Prepaid expenses and other current assets

10,013  

Total current assets

2 unchanged sentences

Property and equipment, net

18,904  

Intangible assets, net

11,079  

Operating lease right-of-use assets

15,855  

Deferred contract costs

1 unchanged sentence

38,926  

Long-term unbilled receivables

11,734  

$ 415,533  

$ 388,738  

Liabilities, mezzanine equity, and stockholders’

2 unchanged sentences

$ 1,519  

$ 1,824  

Accrued expenses and other liabilities

7 unchanged sentences

111,180  

Long-term portion of deferred revenue

Share-based awards classified as liabilities

Long-term operating lease liabilities

11,348  

Long-term portion of deferred revenue

Earn-out shares liabilities

6 unchanged sentences

Mezzanine equity

Redeemable convertible preferred stock, $ 0.0001 par value;

94,695 shares authorized, 42,001 shares issued and outstanding with aggregate liquidation preference of $ 403,361 at December 31, 2020

183,390  

Redemption value of common shares

25,074  

Share-based awards classified as mezzanine equity

Redeemable noncontrolling interest

14,007  

Total mezzanine equity

1 unchanged sentence

Stockholders’

equity (deficiency)

Common stock, $ 0.0001 par value;

1,000,000 and 243,360 shares authorized, 181,822 and 100,068 shares issued and outstanding, at December 31, 2021 and December 31, 2020, respectively

1,000,000 shares authorized, 185,278 and 181,822 shares issued and outstanding

Additional paid-in capital

7 unchanged sentences

Total stockholders’

equity (deficiency)

229,147  

250,355  

Total liabilities, mezzanine equity, and stockholders’

equity (deficiency)

$ 415,533  

8 unchanged sentences

$ 85,580  

$ 27,744  

Term license and support

5 unchanged sentences

21,022  

23,462  

29,122  

Perpetual license

2 unchanged sentences

191,909  

116,099  

Cost of revenue:

4 unchanged sentences

30,726  

24,727  

Total cost of revenue

3 unchanged sentences

139,245  

111,243  

79,700  

Operating expenses:

2 unchanged sentences

100,512  

61,901  

General and administrative

1 unchanged sentence

59,221  

24,614  

Research and development

1 unchanged sentence

31,765  

11,148  

Depreciation and amortization

2 unchanged sentences

192,736  

98,712  

Loss from operations

( 41,066 )  

( 15,437 )  

Change in earn-out shares liabilities and warrant liabilities

21,233  

Interest income, net

Other expense, net

Gain on earn-out and warrant liabilities

21,233  

Interest (expense) income, net

( 40 )  

Other income (expense), net

Loss before income taxes

( 33,650 )  

( 15,907 )  

Income tax expense

$ ( 38,688 )  

$ ( 16,969 )  

Net loss attributable to and accretion of redeemable noncontrolling interest

( 1,974 )  

Net income attributable to and accretion of redeemable noncontrolling interest

( 2,942 )  

1 unchanged sentence

$ ( 41,630 )  

$ ( 16,996 )  

Deemed dividends on preferred stock

( 32,928 )  

( 34,446 )  

Net loss available to common shareholders

$ ( 68,147 )  

$ ( 51,442 )  

$ ( 127,643 )

Loss per share:

$ ( 0.48 )  

$ ( 0.57 )  

$ ( 0.48 )  

$ ( 0.57 )  

Shares used in computing loss per share:

141,596  

89,638  

Net loss available to common stockholders

$ ( 41,630 )  

Basic and diluted loss per share

$ ( 0.23 )  

Basic and diluted shares used in computing loss per share

181,957  

7 unchanged sentences

$ ( 38,688 )  

$ ( 16,969 )  

Other comprehensive income net of taxes

Other comprehensive (loss) income net of taxes

Foreign currency translation adjustments

Total other comprehensive income

Total comprehensive loss

( 250 )  

Total other comprehensive (loss) income

( 250 )  

Comprehensive income attributable to redeemable noncontrolling interests

Total comprehensive loss

$ ( 38,938 )  

Comprehensive income attributable to redeemable noncontrolling interest

( 3,003 )  

1 unchanged sentence

$ ( 41,941 )  

$ ( 16,779 )  

See accompanying notes.

3 unchanged sentences

Equity (Deficiency)

For the Year Ended December 31, 2021, 2020 and 2019

For the Year Ended December 31, 2022 and 2021 

(In thousands, except share amounts)

Redeemable  

Accumulated  

noncontrolling

Stockholders’

Preferred Stock (1)

Common Stock (1)

Treasury Stock

Comprehensive

Stockholders’

Balance, December 31, 2021

8 unchanged sentences

$ 250,355  

$ 1,791  

$ ( 192,827 )

Reclassification of share-based awards to mezzanine equity

( 206 )  

Reclassification of common shares to mezzanine equity

Remeasurement of redemption value of common shares

( 7,361 )  

Proceeds from exercise of options

2 unchanged sentences

1,784,993  

Stock-based compensation expense

46,475  

Common stock issued upon acquisition

324,845  

Remeasurement of redemption value of convertible preferred stock

Common stock issued for canceled officer awards

3,592,504  

Stock-based compensation expense

37,210  

1 unchanged sentence

Issuance of redeemable noncontrolling interest in EduTech

Conversion of convertible preferred stock

( 42,000,592 )  

( 216,318 )  

28,500,592  

85,390  

85,393  

Reclassification of redeemable common shares from mezzanine to permanent equity

( 39,307 )  

39,307  

Reclassification of share-based awards from liabilities and mezzanine equity to permanent equity

( 1,695 )  

41,152  

Merger and recapitalization, net of transaction costs

47,940,523  

Reclassification of earn-out RSUs to earn-out shares

( 885 )  

Repurchase of common stock

( 4,046,186 )  

Reclassification of earn-out RSUs to earn-out shares

4,046,186  

Reclassification of Apex shares purchased prior to the Business Combination

( 19,927 )  

5 unchanged sentences

( 311 )  

( 63 )  

Balance, December 31, 2022

7 unchanged sentences

$ 2,006  

Redeemable  

Accumulated  

$ 229,147  

noncontrolling

Stockholders’

Preferred Stock (1)

1 unchanged sentence

Comprehensive

Stockholders’

Balance, December 31, 2020

8 unchanged sentences

$ ( 299,789 )  

$ 1,791  

$ ( 192,827 )

1 unchanged sentence

( 206 )  

Reclassification of common shares to mezzanine equity

Remeasurement of redemption value of common shares

( 7,361 )  

14,390  

( 14,390 )  

Proceeds from exercise of options

5,141,331  

Stock-based compensation expense

Proceeds from the issuance of common stock, net of issuance costs

11,979,055  

56,260  

Common stock issued upon vesting of restricted stock units

170,852  

Settlement of restricted stock issued in exchange for non-recourse promissory note

Stock-based compensation expense

46,475  

Issuance of common shares in exchange for issuance cost

46,475  

3 unchanged sentences

( 32,928 )  

Redemption of Series B convertible preferred stock

( 9,090,752 )  

( 32,242 )  

( 1,470 )  

Issuance of redeemable noncontrolling interest in EduTech

Comprehensive loss:

( 16,969 )  

Net income attributable to noncontrolling interest

( 27 )  

Foreign currency translation adjustment

Balance, December 31, 2020

42,000,592  

$ 183,390  

$ 25,074  

$ 1,489  

$ 3,061  

$ 213,014  

100,068,469  

$ 105,159  

$ ( 299,789 )  

$ 1,791  

$ ( 192,827 )

Redeemable  

Accumulated  

noncontrolling

Stockholders’

Preferred Stock (1)

Common Stock (1)

Comprehensive

Balance, December 31, 2018

58,529,461  

$ 108,958  

$ 109,732  

73,838,841  

$ 10,244  

$ ( 154,289 )  

$ 1,227  

$ ( 142,809 )

Reclassification of share-based awards to mezzanine equity

( 517 )  

Remeasurement of redemption value of common shares

10,684  

( 10,684 )  

Cumulative effect of accounting change

Conversion of convertible preferred stock

( 42,000,592 )  

( 216,318 )  

Proceeds from exercise of options

( 216,318 )  

Stock-based compensation expense

Options reclassified from permanent equity to liability

28,500,592  

Proceeds from the issuance of common stock, net of issuance costs

85,390  

85,393  

Reclassification of redeemable common shares from mezzanine to permanent equity

( 39,307 )  

Proceeds from the issuance of Series C convertible preferred stock, net of issuance costs

( 39,307 )  

1 unchanged sentence

39,307  

Redemption of Series A convertible preferred stock

Reclassification of share-based awards from liabilities and mezzanine equity to permanent equity

( 1,695 )  

2 unchanged sentences

41,152  

Redemption of Series B convertible preferred stock

Merger and recapitalization, net of transaction costs

47,940,523  

1 unchanged sentence

299,739  

Reclassification of earn-out RSUs to earn-out shares

( 714 )  

Deemed dividend on extinguishment of Series B convertible preferred stock

Reclassification of Apex shares purchased prior to the Business Combination

( 1,739 )  

Comprehensive income (loss):

( 33,245 )  

Net income attributable to and accretion of redeemable noncontrolling interest

( 1,974 )  

Remeasurement of redemption value of convertible preferred stock

Foreign currency translation adjustment

( 63 )  

Comprehensive loss:

( 63 )  

Foreign currency translation adjustment

Balance, December 31, 2021

7 unchanged sentences

$ 250,355  

$ 1,574  

$ ( 198,682 )

(1) As part of the Business Combination (as disclosed in "Note 3 —

Business Combination" ), all per share information has been retroactively adjusted using an exchange ratio of 8.69144 per share.

(1) As part of the Apex Business Combination (the “

Business Combination ”) (as disclosed in “

Note 3 —

Business Combination ”), all per share information has been retroactively adjusted using an exchange ratio of 8.69144 per share.

See accompanying notes.

6 unchanged sentences

$ ( 38,688 )  

$ ( 16,969 )  

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

Depreciation and amortization

Foreign currency remeasurement loss (gain)

( 378 )  

Provision for doubtful accounts

( 740 )  

Operating lease right-of-use assets expense

Foreign currency remeasurement loss

Stock-based compensation

1 unchanged sentence

59,508  

13,893  

Loss (gain) on disposal of property and equipment

( 15 )  

Deferred income taxes

( 607 )  

( 433 )  

Change in value of earn-out and warrant liabilities

1 unchanged sentence

Changes in operating assets and liabilities:

Accounts receivable and long-term unbilled receivables

( 9,012 )  

Accounts receivable

( 14,388 )  

3 unchanged sentences

( 9,596 )  

Accounts payable, accrued expenses, operating lease liabilities and other liabilities

( 2,553 )  

Accounts payable, accrued expenses and other liabilities

10,626  

2 unchanged sentences

10,805  

14,365  

Net cash provided by (used in) operating activities

Net cash (used in) provided by operating activities

( 774 )  

Investing activities

Maturity (purchase) of short-term investments

Maturities of investments

183,554  

Purchase of property and equipment

Purchases of investments

( 180,969 )  

Cash paid in business combinations and asset acquisitions, net of cash acquired

( 18,572 )  

Net cash provided by (used in) investing activities

Capitalization of internal-use software

( 1,612 )  

Financing activities

Proceeds from recapitalization of Apex shares

Purchase of property and equipment

( 3,853 )  

Redemption of redeemable convertible preferred stock

Net cash used in investing activities

( 21,452 )  

Financing activities

Proceeds from recapitalization of Apex shares, net of transaction fees of $ 49,990

441,573  

Redemption of redeemable convertible preferred stock

Redemption of Legacy AvePoint common stock

( 106,169 )  

Purchase of treasury stock

Purchase of common stock

( 19,927 )  

Payment of net cash settlement for management options

( 7,530 )  

Proceeds from stock option exercises

Proceeds from sale of common shares of subsidiary

Repayments of capital leases

( 25 )  

( 49 )  

Payments of debt issuance costs

( 300 )  

Proceeds from issuance of Common stock, net of issuance costs

58,770  

33,670  

Collection of promissory note

Collection of non-recourse promissory note

Proceeds from issuance of Series C convertible preferred stock

Repayments of finance leases

( 39 )  

Payments of transaction fees by Legacy AvePoint

( 2,998 )  

( 2,089 )  

Payments of transaction fees

( 49,990 )  

( 101 )  

Net cash provided by (used in) financing activities

Net cash (used in) provided by financing activities

( 17,148 )  

2 unchanged sentences

( 1,655 )  

Net increase (decrease) in cash and cash equivalents

Net (decrease) increase in cash and cash equivalents

( 41,029 )  

3 unchanged sentences

69,112  

16,378  

Cash and cash equivalents at end of period

1 unchanged sentence

$ 268,217  

$ 12,162  

Supplemental disclosures of cash flow information

Cash paid for:

Income taxes paid

$ 3,320  

$ 4,037  

Non-cash investing and financing activities

Issuance of common shares in exchange for issuance cost

Contingent considerations in business combination

$ 5,635  

Property and equipment acquired under capital leases

Common stock issued in business combination

$ 1,517  

Loan to certain acquiree shareholders

See accompanying notes.

3 unchanged sentences

Nature of Business and Organization

Apex Technology Acquisition Corporation (" Apex ") was a blank check company incorporated in Delaware on April 5, 2019.

Apex was formed for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. AvePoint, Inc. (“

Legacy AvePoint ”) was incorporated as a New Jersey corporation on July 

24, 2001, was redomiciled as a Delaware corporation in 2006, and changed its name to "AvePoint Operations, Inc." in June 

On November 

23, 2020, Legacy AvePoint and the members of the Apex Group entered into the Business Combination Agreement.

On July 1, 2021, Pursuant to the terms of the Business Combination Agreement, Merger Sub 1, a wholly owned subsidiary of Apex, merged with and into Legacy AvePoint, with Legacy AvePoint surviving the merger as a wholly-owned subsidiary of Apex.

Promptly following the first merger, Legacy AvePoint merged with and into Merger Sub 2, with Merger Sub 2 as the surviving company and a wholly owned subsidiary of Apex, subsequently renamed “AvePoint US LLC.”

Following the consummation of those merger activities, Apex was renamed “AvePoint, Inc.”

On July 26, 2021, 

AvePoint US LLC merged with and into AvePoint, Inc.

with AvePoint, Inc.

AvePoint, Inc.

was incorporated as a New Jersey corporation on July 24, 2001, and redomiciled as Delaware corporation in 2006.

On July 1, 2021, AvePoint, Inc.

(hereinafter referred to as “

AvePoint ,”

" us ," or “

our ”) surviving. See the sections of this Annual Report titled " Business —

2021 Consummation of the Business Combination ”

(Part I, Item 1 of this Annual Report) and " Note 3 - Business Combination " (Part II, Item 8 of this Annual Report) for additional information.

We are a leading provider of enterprise collaboration and productivity software solutions.

We develop, market, and sell our suite of software solutions and services, primarily in North America, Europe, Australia, and Asia.

We provide our customers with high-performance infrastructure management, compliance, data governance, mobility and productivity, online services and software solutions consulting.

We do this through our Confidence Platform, a SaaS platform that assists organizations who use M365 and more than a half dozen other cloud collaboration utilities.

Our Confidence Platform, built on AOS, contains our suites of software solutions:

our Control Suite, for data governance enabling collaboration services at scale, with automation and repeatable business templates;

our Fidelity Suite for the preservation of data integrity as organizations undergo digital transformation projects to streamline the way they work from one collaboration system to the next;

and our Resilience Suite to help organizations comply with data governance regulations, preserve business records for compliance, and ensure business continuity.

AvePoint ”, the “

Company ”, “

we ”, “

us ”, or “

our ”) became a publicly traded company, as further described in “

Note 3 - Business Combination ”.

AvePoint provides a cloud-native software platform that organizations rely on to optimize operations, manage critical data and secure the digital workplace.

As companies around the world embrace the new normal of hybrid work, they must build and deliver a new, seamless workplace experience for knowledge workers, centered around an extensive portfolio of SaaS solutions and productivity applications aimed at improving collaboration across the organization.

The adoption of this portfolio of solutions –

what has been generally described as the “digital transformation”

is a substantial and ongoing challenge for most organizations, which for decades had previously relied upon only a small number of multi-purpose on-premises applications to drive business outcomes.

However, to build and deliver an efficient digital workplace today, companies must address this abundance of applications –

and the associated explosive growth and sprawl of data –

with a platform offering that is well governed, fit for purpose, easy to use and built on automation.

AvePoint’s Confidence Platform empowers organizations –

of all sizes, in all regions, and across all industries –

to optimize and secure the solutions that most commonly establish and underpin the digital workplace.

As our customers seek to rapidly reduce costs, improve productivity and make more informed business decisions, they depend on our platform for data-driven insights, critical business intelligence and ongoing operational value through automation.

Our principal headquarters are located in Jersey City, New Jersey, with our operating headquarters in Richmond, Virginia and additional offices in North America, Europe, Asia, Australia and the Middle East.

2 unchanged sentences

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and include the consolidated accounts of AvePoint, Inc.

and its wholly owned subsidiaries.

and its subsidiaries.

All intercompany transactions and balances have been eliminated in consolidation.

Recently Adopted Accounting Guidance

February 2016, 

the Financial Account Standard Board (the “

FASB ”) issued Accounting Standards Update (“

ASU ”) 

2016 - 02,  

Leases  (Accounting Standards Codification (“

ASC ”)) and subsequently issued amendments to the initial guidance:

2017 - 13, ASU 2018 - 10, ASU 2018 - 11, ASU 2018 - 20, ASU 2019 - 01, ASU 2019 - 10, ASU 2020 - 02, ASU 2020 - 05 and ASU 2021 - 05 (collectively, “

842 ”).

The Company adopted ASC 

842  on 

January 1, 2022, using the modified retrospective approach and has elected 

not  to restate comparative periods and record a cumulative-effect adjustment as of the effective date.

842  requires companies to generally recognize on the balance sheet operating and finance lease liabilities and corresponding right-of-use (“

ROU ”) assets.

The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which allowed the Company to carry forward its historical assessments of whether a contract contains a lease, lease classification and initial direct costs.

The Company elected 

not  to use hindsight in determining the lease term.

The Company made the following other transition considerations and elections under ASC 

 (i) 

not  to separate non-lease components for all classes of underlying assets, including under Leases (“

840 ”)

for the purpose of transition measurement;

(ii) apply accounting similar to ASC 

840  for operating lease with term of 

12  months or less at the commencement date;

(iii) consider remaining lease term as of the date of initial application in determining the incremental borrowing rate to be used to discount minimum rental payments for operating leases in transition.

The adoption of the new standard resulted in the recognition of ROU assets of $ 13.9  million, net of previously recognized deferred rent balance of $ 0.6  million and total lease liabilities of $ 14.5  million, including a current liability of $ 3.6  million, and corresponding deferred tax assets and liabilities, on the Company’s consolidated balance sheet as of 

January 1, 2022 .

 The adoption had 

no  significant impact on the Company’s consolidated statements of operations or cash flows.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

October 2021 ,  the FASB issued ASU 

2021 - 08 ,  Business Combinations (“

805 ”), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with Revenue from contracts with customers (“

606 ”).

Generally, this new guidance will result in the acquirer recognizing contract assets and contract liabilities at the same amounts recorded by the acquiree.

The new guidance should be applied prospectively to acquisitions occurring on or after the effective date.

The standard is effective for fiscal years beginning after 

December 15, 2022 ,  including interim periods within those fiscal years.

Early adoption is permitted, including in interim periods, for any financial statements that have 

not  been issued.

The Company early adopted the new standard on 

January 1, 2022 .

 We applied the new guidance to the current year acquisitions.

The adoption of the standard did 

not  have any impact on the Company’s consolidated financial statements.

Comparative Data

Certain amounts from prior periods which have been presented separately have been grouped to conform to the current period presentation, including:

The reclassification of prepaid rent to be included in prepaid expenses and other current assets on the consolidated balance sheets as of December 31, 2020;

The reclassification of accrued rent obligation to be included in accounts payable, accrued expenses and other liabilities on the consolidated statements of cash flows for the years ended December 31, 2020 and 2019;

The reclassification of equity issuance costs to be offset from proceeds from issuance of common stock on the consolidated statements of mezzanine equity and stockholders' equity (deficiency) for the year ended December 31, 2020;

The reclassification of equity issuance costs to be offset from proceeds from issuance of Series C preferred stock on the consolidated statements of mezzanine equity and stockholders' equity (deficiency) for the year ended December 31, 2019;

The reclassification of remeasurement of redemption value of Series B preferred stock to be offset from remeasurement of redemption value of Series C preferred stock and both included in the remeasurement of redemption value of convertible preferred stock on the consolidated statements of mezzanine equity and stockholders’

equity (deficiency) for the year ended December 31, 2019;

The reclassification of current portion of capital lease and deferred rent into others on the Note 7 —

accrued expenses and other liabilities in the notes to consolidated financial statements as of December 31, 2020.

Certain amounts from prior periods have been presented separately have been grouped to conform to the current period presentation, including:

The reclassification of long-term unbilled receivables to be included in other assets on the consolidated balance sheets as of December 31, 2021;

The reclassification of long-term unbilled receivables to be included in deferred contracts and other assets on the consolidated statements of cash flows for the year ended December 31, 2021;

The reclassification of provision for doubtful accounts and loss (gain) on disposal of property and equipment to be included in other on the consolidated statements of cash flows for the year ended December 31, 2021;

The payments of transaction fees to be included in proceeds from recapitalization of Apex shares on the consolidated statements of cash flows for the year ended December 31, 2021.

Business Combination

The Business Combination was accounted for as a reverse recapitalization as Legacy AvePoint was determined to be the accounting acquirer under Financial Accounting Standards Board’s Accounting Standards Codification Topic 805, Business Combinations.

This determination was primarily based on Legacy AvePoint comprising the ongoing operations of the combined entity, Legacy AvePoint’s senior management comprising the majority of the senior management of the combined company and the prior shareholders of Legacy AvePoint having a majority of the voting power of the combined entity.

In connection with the Business Combination, the outstanding shares of Legacy AvePoint's preferred stock were redeemed for cash and shares of AvePoint’s Common Stock and the outstanding shares of Legacy AvePoint's common stock were converted into AvePoint's Common Stock, representing a recapitalization, and the net assets of the Company were acquired at historical cost, with no goodwill or intangible assets recorded.

Operations and assets and liabilities of the Company prior to the Business Combination in these financial statements are those of Legacy AvePoint.

As a result, these financial statements represent the continuation of Legacy AvePoint and the historical shareholders’

Common stock, preferred stock and loss per share of Legacy AvePoint prior to the Business Combination have been retrospectively adjusted for the Business Combination using an exchange ratio of 8.69144.

Options to purchase common stock of Legacy AvePoint were converted into options to purchase common stock of AvePoint, Inc.

using an exchange ratio of 8.6914.

The options, as converted, continue to be governed by Legacy AvePoint's existing stock option plan.

The accumulated deficit of Legacy AvePoint has been carried forward after the Business Combination.

Refer to "Note 3  —

Business Combination" for additional information.

All per share information in the consolidated balance sheets, consolidated statements of operations, consolidated statements of mezzanine equity and stockholders' equity (deficiency) and the notes to consolidated financial statements have been retroactively adjusted using an exchange ratio of 8.69144 per share.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes.

We base our estimates and assumptions on historical experience and on various other assumptions that we believe are reasonable under the circumstances.

The amounts of assets and liabilities reported in our consolidated balance sheets and the amounts of revenue and expenses reported for each of its periods presented are affected by estimates and assumptions, which are used for, but not limited to, the accounting for revenue recognition, allowance for doubtful accounts, deferred contract costs, income taxes and related reserves, stock-based compensation, and earn-out liabilities.

Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties, including uncertainty in the current economic environment due to the outbreak of COVID- 19.

When we consummate a business combination, the assets acquired, and the liabilities assumed are recognized separately from goodwill at their acquisition date fair values.

Goodwill as of the acquisition date is measured as the excess of the fair value of consideration transferred over the acquisition date fair value of the net identifiable assets acquired.

While best estimates and assumptions are used to accurately value assets acquired and liabilities assumed at the acquisition date as well as contingent consideration, where applicable, our estimates are inherently uncertain and subject to refinement.

As a result, during the measurement period, which 

be up to 

one  year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill as we obtain new information about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date.

Upon the earlier of the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, any subsequent adjustments are recorded in the consolidated statements of operations.

Acquisition-related costs were immaterial and were expensed as incurred.

Pro forma historical results of operations related to the business combinations closed in 2022 have not been presented because they are not material business combinations to our consolidated financial statements, either individually or in aggregate.

Goodwill represents the excess of the fair value of consideration transferred over the fair value of net identifiable assets acquired. 

We review goodwill for impairment at least annually or more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable.

We have elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of our single reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test.

If we determine that it is more likely than not that its fair value is less than its carrying amount, then the quantitative goodwill impairment test will be performed.

The quantitative goodwill impairment test identifies goodwill impairment and measures the amount of goodwill impairment loss to be recognized by comparing the fair value of our single reporting unit with its carrying amount.

If the fair value exceeds its carrying amount, no further analysis is required;

otherwise, any excess of the goodwill carrying amount over the implied fair value is recognized as an impairment loss, and the carrying value of goodwill is written down to fair value.

During the year ended December 31, 2022, the goodwill was not impaired.

There was 

no  goodwill as of 

December 31, 2021 .

Intangible Assets, net

Intangible assets primarily consist of customer related assets and acquired software and technology.

Typical customer related assets include order backlogs and customer relationships.

Intangible assets that have finite useful lives are amortized over their useful lives on a straight-line basis, which range from 

one  year to 

ten  years.

We evaluate the recoverability of intangible assets periodically by considering events or circumstances that 

warrant revised estimates of useful lives or that indicate the asset 

AvePoint, Inc.

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Notes to Consolidated Financial Statements (continued)

Use of Estimates

We base our estimates and assumptions on historical experience and on various other assumptions that we believe are reasonable under the circumstances.

The amounts of assets and liabilities reported in our consolidated balance sheets and the amounts of revenue and expenses reported for each of its periods presented are affected by estimates and assumptions, which are used for, but not limited to, the accounting for revenue recognition, allowance for doubtful accounts, deferred contract costs, valuation of goodwill and other intangible assets, income taxes and related reserves, stock-based compensation, purchase price in a business combination, and earn-out liabilities.

Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties.

Foreign Currency

We have foreign operations where the functional currency has been determined to be the local currency, in accordance with FASB ASC 830, Foreign Currency Matters .

The Company has foreign operations where the functional currency has been determined to be the local currency, in accordance with FASB ASC 830, Foreign Currency Matters .

Adjustments resulting from translating such foreign functional currency assets and liabilities into U.S.

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Transaction gains and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in other income (expense), net in the Company’s consolidated statements of operations.

Transaction losses totaled $ 0.9  million, $ 0.6  million and $ 0.7 million for the years ended December 31, 2021 , 2020 and 2019 respectively.

Transaction gains totaled $ 0.1  million for the year ended 

December 31, 2022 , and transaction losses totaled $( 0.9 ) million for the year ended December 31, 

Cash and Cash Equivalents

We maintain cash with several high credit-quality financial institutions.

We consider all investments available with original maturities of three months or less to be cash equivalents and consist mainly of U.S.

treasury bills and certificate of deposits.

These investments are not subject to significant market risk.

We maintain our cash and cash equivalents in bank accounts which, at times, exceed the federally insured limits.

We have not experienced any losses in such accounts.

We maintain cash balances used in operations at entities based in the People’s Republic of China, which imposes regulations that limit the ability to transfer cash out of the country.

As of December 31, 2021  and December 31, 2020 , our cash balances at these entities were $ 9.3  million and $ 6.8  million, respectively.

The Company maintains cash with several high credit-quality financial institutions.

The Company considers all investments available with original maturities of three months or less to be cash equivalents. These investments are not subject to significant market risk.

The Company maintains its cash and cash equivalents in bank accounts which, at times, exceed the federally insured limits.

The Company has 

not experienced any losses in such accounts.

The Company maintains cash balances used in operations at entities based in countries which impose regulations that limit the ability to transfer cash out of the country.

December 31, 2022 and 2021 , the Company’s cash balances at these entities were $ 10.8  million and $ 9.3  million, respectively.

For purposes of the consolidated statements of cash flows, cash includes all amounts in the consolidated balance sheets captioned cash and cash equivalents.

Short-Term Investments

Short-term investments consist mainly certificate of deposits held by financial institutions which have an initial maturity of greater than three months but less than or equal to one year at period end.

Short-term investments consist mainly of certificates of deposit held by financial institutions which have an initial maturity of greater than three months but less than or equal to one year at period end.

Allowance for Doubtful Accounts

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Property and equipment are stated at cost and depreciated on a straight-line basis over the shorter of their estimated useful lives or related contract terms beginning in the year the asset was placed into service.

Computer equipment and software

Leasehold improvements

Furniture and fixture

Office equipment

We depreciate computer equipment and software generally over a period of three years.

We amortize leasehold improvements over the shorter of the remaining lease term or the estimated useful lives of the assets.

We depreciate furniture and fixture generally over a period of seven years.

We depreciate buildings over a period of forty years.

We depreciate office equipment generally over a period of five years.

Depreciation and amortization for buildings, information technology assets, leasehold improvements, and furniture and fixtures commences once they are ready for our intended use.

Normal repair and maintenance costs are expensed as incurred.

We write off depreciated assets that are no longer in service.

Leasehold improvements are amortized over the lesser of the lease term or the estimated useful life of the improvements and such amortization is included in depreciation and amortization expense.

We evaluate long-lived assets, which include leasehold improvements and equipment subject to amortization, for impairment whenever events or changes in business circumstances indicate that the carrying value of an asset may not be recoverable.

We evaluate long-lived assets, which include leasehold improvements and equipment subject to depreciation and amortization, for impairment whenever events or changes in business circumstances indicate that the carrying value of an asset may not be recoverable.

An impairment loss will be recognized when the aggregate of estimated undiscounted future cash flows expected to result from the use and the eventual disposition of the long-lived assets less than its carrying amount.

Impairment, if any, is determined based on the fair value of the long-lived asset.

There were no impairment charges recognized during the years ended years ended 

December 31, 2021 , 2020 , and 2019 , respectively.

There were no impairment charges recognized during the years ended December 31, 2022  and 

2021 , respectively.

We evaluate the portion of depreciation and amortization expense attributable to cost of revenue based on organizational headcount directly attributable to the generation of revenue.

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therefore, the full expense has been recorded in operating expenses in the consolidated statements of operations.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Deferred Contract Costs

We defer sales commissions earned by its sales force that are considered to be incremental and recoverable costs of obtaining SaaS, term license and support, service, perpetual license and maintenance contracts.

We defer sales commissions earned by our sales force that are considered to be incremental and recoverable costs of obtaining or renewing SaaS, term license and support, service, perpetual license and maintenance contracts.

We have structured commissions plans such that the commission rate paid on renewal contracts are less than those paid on the initial contract;

therefore, it is determined that the renewal commissions are not commensurate with the initial commission.

therefore, it is determined that the renewal commissions are not commensurate with the initial commission and thus capitalized as deferred contract costs.

We determine the estimated average customer relationship period and average renewal term utilizing a portfolio approach.

Deferred costs are periodically reviewed for impairment.

Amortization of deferred contract costs of $ 9.5  million, $ 10.5  million and $ 7.7 million for the years ended December 31, 2021 , 2020 and 2019 respectively, is included as a component of sales and marketing expenses in our consolidated statements of operations.

Deferred contract costs recognized as a contract asset on our balance sheet was $ 38.9 million and $ 31.9 million at December 31, 2021  and December 31, 2020 , respectively.

No impairment was recorded for the years ended 

December 31, 2022 and 2021 .

Amortization of deferred contract costs of $ 13.4  million and $ 9.5  million for the years ended 

December 31, 2022  and 

2021 , respectively, is included as a component of sales and marketing expenses in our consolidated statements of operations.

Deferred contract costs recognized as a contract asset on our balance sheet was $ 48.6 million and $ 38.9 million as of 

December 31, 2022 and 2021 , respectively.

Software Development Costs

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After technological feasibility is established, costs are capitalized in accordance with ASC 985 - 20.

Company’s primary on-premises product is DocAve which is within the scope of subtopic 985 - 20.

The Company’s primary on-premises product is DocAve which is within the scope of subtopic 985 - 20.

DocAve has been on the market since 2002.

Typically, the economic life of software produced is less than 5 years.

Typically, the economic life of software produced is less than five  years.

As such, any costs subject to capitalization under ASC 985 - 20 would be fully amortized at this time.

As a result, no internally generated software development costs have been capitalized as of December 31, 2021 or December 31, 2020.

As a result, no internally generated software development costs have been capitalized as of 

December 31, 2022 and 2021 .

We account for costs to develop or obtain internal-use software and implementation costs incurred in hosting arrangements in accordance with ASC 350 - 40, Internal-Use Software, or ASC 350 - 40.

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The following table presents our revenue by source:

For the Year Ended

(in thousands)

$ 117,180  

$ 85,580  

Term license and support

57,214  

50,970  

41,283  

31,919  

15,868  

21,022  

Perpetual license

Total revenue

Term license and perpetual license revenue recognized at point in time was $ 39.7  million, $ 32.4  million and $ 26.3 million for the years ended 

December 31, 2021, 2020, and 2019, respectively. The remaining revenue amount is recognized over time.

$ 232,339  

$ 191,909  

Term license and perpetual license revenue recognized at point in time was $ 40.0 million and $ 39.7 million for the years ended December 31, 2022  and 

2021 , respectively.

The remaining revenue amount is recognized over time.

Our sources of revenue mainly include:

SaaS and term license and support revenue includes revenue from sale of SaaS and term license and support, versions of our software and related customer support.

SaaS revenue is recognized ratably over the term of the of the contract.

SaaS and term license and support revenue includes revenue from the sale of SaaS and term license and support, versions of our software and related customer support.

SaaS revenue is recognized ratably over the term of the contract.

Term license revenue includes distinct on-premises license and support performance obligations.

The license is generally recognized upfront at the point in time when the software is made available to the customer to download and use, and the support is recognized ratably over the term of the of the contract.

Perpetual license revenue is recognized up front upon delivery of the licensed product and/or the utility that enables the customer to access authorization keys, provided that an enforceable contract has been received.

Perpetual license revenue is recognized upfront upon delivery of the licensed product and/or the utility that enables the customer to access authorization keys, provided that an enforceable contract has been received.

Typically, our perpetual licenses are sold with post-contract support (PCS), which includes unspecified technical enhancements and customer support.

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Services revenue from managed services is recognized ratably on a straight-line basis over the contract term.

In rare cases when the software and the related when-and-if available updates are critical to the combined utility of the software, the Company has determined this to be one performance obligation and revenue is recognized ratably over the license term. 

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

ASC 606 is a single standard for revenue recognition that applies to all of our SaaS, term license and support, services, perpetual license and maintenance arrangements and generally requires revenue to be recognized upon the transfer of control of promised goods or services provided to its customers, reflecting the amount of consideration it expects to receive for those goods or services.

Pursuant to ASC 606, revenue are recognized upon the application of the following steps:

Pursuant to ASC 606, revenue is recognized upon the application of the following steps:

identification of the contract, or contracts, with a customer;

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We record an unbilled receivable when revenue is recognized prior to invoicing.

Current unbilled receivable is included in accounts receivable, net in the consolidated balance sheets.

Current unbilled receivables are included in accounts receivable, net in the consolidated balance sheets.

Long-term unbilled receivables that are expected to be billed more than twelve months after the period end are included within other assets in the consolidated balance sheets.

We record deferred revenue in the consolidated balance sheets when cash is collected or invoiced before revenue is earned.

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Services are generally invoiced in advance or as the services are performed.

Total deferred revenue as of December 31, 2020  was $ 74.7  million, of which $ 62.1  million was recognized as revenues for the year ended December 31, 2021 .

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Finan

cial Statements (continued)

Total deferred revenue as of December 31, 2021 , was $ 82.3  million, of which $ 72.3  million was recognized as revenues for the year ended December 31, 2022 .

The opening and closing balances of the Company’s accounts receivable, net, deferred revenue and deferred contract costs are as follows:

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Increase/(decrease)

10,130  

14,088  

Opening (January 1, 2022)

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Increase/(decrease)

12,013  

19,158  

( 1 ) Accounts receivable, net is inclusive of accounts receivable, net of allowance for doubtful accounts, current unbilled receivables and long-term unbilled receivables.

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We typically establish an SSP range for our products and services which is reassessed on a periodic basis or when facts and circumstances change.

Term license are sold only as a bundled arrangement that includes the rights to a term license and support.

In determining the SSP of license and support in a term license arrangement we applied observable inputs using the value relationship between support and term license, the value relationship between support and perpetual licenses, the average economic life of our products, software renewals rates and the price of the bundled arrangement 

in relation to the perpetual licensing approach.

Using a combination of the relative fair value method or the residual value method the SSP of the performance obligations in an arrangement was allocated to each performance obligation within a sales arrangement.

Term licenses are sold only as a bundled arrangement that includes the rights to a term license and support.

In determining the SSP of license and support in a term license arrangement we apply observable inputs using the value relationship between support and term license, the value relationship between support and perpetual licenses, the average economic life of our products, software renewal rates and the price of the bundled arrangement in relation to the perpetual licensing approach.

Using a combination of the relative fair value method or the residual value method, the SSP of the performance obligations in an arrangement is allocated to each performance obligation within a sales arrangement.

As of December 31, 2022 , transaction price allocated to remaining performance obligations, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods, was $ 237.8  million, of which $ 186.3  million is related to SaaS and term license and support revenue.

We expect to recognize approximately 64 % of the total transaction price allocated to remaining performance obligations over the next twelve months and the remainder thereafter.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

We utilize indirect sales channels which utilize Channel Partners.

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We recognize revenue when control of the goods and/or services are transferred to the customer.

In this first form of the sales transaction, revenue recognition occurs upon transfer to the Channel Partner (acting as reseller) or as directed by the Channel Partner's (acting as reseller's) to its customer.

In this first form of the sales transaction, revenue recognition occurs upon transfer to the Channel Partner (acting as reseller) or as directed by the Channel Partner (acting as reseller) to its customer.

End User as Customer

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Stock-based compensation represents the cost related to stock-based awards granted to employees.

To date, we have issued both stock options and restricted stock units (" RSUs ').

With respect to equity-classified awards, the Company measures stock-based compensation cost at the grant date based on the estimated fair value of the award and recognizes the cost as expense ratably (net of estimated forfeitures) over the requisite service period.

With respect to liability-classified awards, the Company measures stock-based compensation cost at the grant date and at each reporting period based on the estimated fair value of the award.

To date, we have issued both stock options and restricted stock units (“

RSUs ”).

With respect to equity-classified awards, the Company measured stock-based compensation cost at the grant date based on the estimated fair value of the award and recognizes the cost as expense ratably (net of estimated forfeitures) over the requisite service period.

With respect to liability-classified awards, the Company measures stock-based compensation cost at the grant date and at each reporting period based on the estimated fair value of the award.

Stock-based compensation cost is recognized ratably over the requisite service period, net of actual forfeitures in the period.

We estimate the fair value of stock options using a Black-Scholes valuation model.

We estimate the fair value of stock options using the Black-Scholes valuation model.

The Black-Scholes model requires highly subjective assumptions in order to derive the inputs necessary to the calculate the fair value of stock options.

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Treasury zero coupon issues with a remaining term equal to the expected term.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to difference between financial statement carrying amounts of existing assets and liabilities and their respective tax basis.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between financial statement carrying amounts of existing assets and liabilities and their respective tax basis.

Deferred tax assets and liabilities are measured using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled.

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federal, various states and foreign jurisdictions.

The tax years 2017 through 2020  are open and subject to audit by US federal, state and local authorities.

The tax years 2011 through 2020  are open and subject to audit by foreign tax jurisdictions.

The tax years 2018  through 2021  are open and subject to audit by U.S.

federal, state and local authorities.

The tax years 2012 through 

2021  are open and subject to audit by foreign tax jurisdictions.

AvePoint, Inc.

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Redeemable Noncontrolling Interest

At December 31, 2021 and 2020, we owned approximately 76.09 % and 77.78 %, respectively, and AEPL PTE.

AEPL ”) owned 23.91 % and 22.22 %, respectively, of AvePoint EduTech Pte.

EduTech ”).

As part of AEPL’s investment in EduTech, we granted AEPL a put option which allows AEPL to cause us to repurchase AEPL’s shares in EduTech at any time between December 

24, 2022 and December 

24, 2023 at a price equal to AEPL’s initial investment.

Consequently, we record redeemable noncontrolling interest as mezzanine equity in our consolidated balance sheets.

At each reporting period, we increase the carrying amount of the redeemable noncontrolling interest by periodic accretions using the interest method so that the carrying amount will equal the redemption amount on the date that the put option becomes exercisable, and adjustments to the value are recorded as net income attributable to and accretion of redeemable noncontrolling interest on consolidated statements of mezzanine equity and stockholders' equity (deficiency).

December 31, 2022 and 2021 , the Company owned 73.82 % and 76.09 % of AvePoint EduTech Pte.

EduTech ”), respectively.

AEPL ”)

As part of AEPL’s investment in EduTech, the Company granted AEPL a put option which allows AEPL to cause the Company to repurchase AEPL’s shares in EduTech at any time between December 24, 2022, and December 24, 2023, at a price equal to AEPL’s initial investment of approximately $ 8.3 million.

Consequently, the Company records redeemable noncontrolling interest as mezzanine equity in its consolidated balance sheets.

At each reporting period, the Company increases the carrying amount of the redeemable noncontrolling interest by periodic accretions using the interest method so that the carrying amount will equal the redemption amount on the date that the put option becomes exercisable, and adjustments to the value are recorded as net income attributable to redeemable noncontrolling interest.

December 31, 2022 and 2021 , AEPL owned 

23.20 % and 23.91 % of EduTech, respectively.

I-Access Solutions Pte.

I-Access ”)

On February 18, 2022, ( the “

I-Access Closing Date ”), EduTech consummated its acquisition of all of the ordinary shares of I-Access, a Singapore limited company.

As a result, I-Access became a wholly owned subsidiary of EduTech.

The acquisition was made pursuant to a share purchase agreement, dated as of January 31, 2022, ( the “

Share Purchase Agreement ”), by and among EduTech and the former I-Access shareholders.

December 31, 2022, former I-Access shareholders owned 2.98 % of EduTech and such shares were included in redeemable noncontrolling interest.

Refer to (“

Note 3 - Business Combination ”) for further details.

Emerging Growth Company

We are considered an emerging growth company.

The Company is considered an emerging growth company.

Section 

102 (b)( 1 ) of the Jobs Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards.

The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable.

We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

The Company elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

Recent Accounting Pronouncements

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Contracts in Entity’s Own Equity (Subtopic 815 —

(“ASU 2020 - 06”

ASU 2020 - 06 ”).

ASU 2020 - 06 simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity.

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We are currently evaluating the impact ASU 2020 - 06 will have on our consolidated financial statements.

In December 2019, the FASB issued ASU 2019 - 12, Income Taxes (ASC 740 ):

Simplifying the Accounting for Income Taxes (ASU 2019 - 12 ), which is intended to simplify various areas related to the accounting for income taxes and improve consistent application of ASC 740.

The amendments in this ASU are effective for EGC entities, which elected to take advantage of the extended transition period, for fiscal years beginning after December 15, 2021.

Early adoption of the amendments is permitted, including adoption in any interim period for public business entities for periods for which financial statements have not yet been issued and all other entities for periods for which financial statements have not yet been made available for issuance.

We are currently evaluating the impact of its pending adoption of ASU 2019 - 12 on our consolidated financial statements.

In February 2016, the FASB issued ASU 2016 - 02, Leases (ASC 842 ) and subsequently issued amendments to the initial guidance:

ASU 2017 - 13, ASU 2018 - 10, ASU 2018 - 11, ASU 2018 - 20, ASU 2019 - 01, ASU 2019 - 10, ASU 2020 - 02,  ASU 2020 - 05 and ASU 2021 - 05  (collectively, ASC 842 ).

ASC 842 requires companies to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets.

ASC 842 is effective for EGC entities, which elected to take advantage of the extended transition period, for fiscal years beginning after December 15, 2021.

ASC 842 must be adopted using a modified retrospective method and its early adoption is permitted.

The Company is currently evaluating the impact of adoption of this ASU on its consolidated financial statements.

While the Company generally expects the financial records to be impacted by the requirements highlighted above, the Company cannot reasonably estimate the impact that adoption of the ASUs referenced in this announcement is expected to have on the financial statements at this time.

In January 2016, the FASB issued ASU 2016 - 13, “Financial Instruments —

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Early application of the amendments is permitted.

The Company is currently evaluating the impact of adoption of this ASU on its consolidated financial statements.

The adoption of the standard will not have a material impact on the Company's consolidated financial statements.

While we generally expect the financial records to be impacted by the requirements highlighted above, we cannot reasonably estimate the impact that adoption of the ASUs referenced in this announcement is expected to have on the financial statements at this time.

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 Business Combination

Apex Technology Acquisition Corporation

On November 

23, 2020, Legacy AvePoint and the members of the Apex Group entered into the Business Combination Agreement.

The Business Combination by and among Legacy AvePoint and the members of the Apex Group was effected on July 1, 2021 by the merger of Athena Technology Merger Sub, Inc. (" Merger Sub 1 ") with and into Legacy AvePoint (the “

First Merger ”), with Legacy AvePoint surviving the First Merger as a wholly-owned subsidiary of Apex, and promptly following the First Merger, Legacy AvePoint was merged with and into Athena Technology Merger Sub 2, LLC (" Merger Sub 2 ") (the “

Second Merger ”), with Merger Sub 2 surviving the Second Merger (the “

Surviving Entity ”) as a wholly-owned subsidiary of Apex (the Second Merger together with the First Merger, the “

Mergers ”).

Following the consummation of the Mergers, the Surviving Entity changed its name to AvePoint US, LLC and Apex changed its name to AvePoint, Inc.

(hereinafter referred to as “

AvePoint ,”

the " Company ," “

" us ," or “

our ”).

On July 26, 2021, AvePoint US, LLC was merged with and into AvePoint, with AvePoint surviving.

The following transactions occurred in connection with the Business Combination which impacted our mezzanine equity and permanent equity accounts:

23, 2020, AvePoint, Inc.

Legacy AvePoint ”) and certain members of Apex (as defined below) entered into the Apex Business Combination Agreement.

The business combination by and among Legacy AvePoint and certain members of Apex was effected on July 1, 2021, and through a series of merger transactions, which were finalized on July 26, 2021, ( the “

Apex Business Combination ”) Apex Technology Acquisition Corporation (“

Apex ”) was the surviving entity and changed its name to AvePoint.

The Apex Business Combination was accounted for as a reverse recapitalization as Legacy AvePoint was determined to be the accounting acquirer under ASC 805.

This determination was primarily based on Legacy AvePoint comprising the ongoing operations of the combined entity, Legacy AvePoint’s senior management comprising the majority of the senior management of the combined company and the prior stockholders of Legacy AvePoint having a majority of the voting power of the combined entity.

In connection with the Apex Business Combination, the outstanding shares of Legacy AvePoint’s preferred stock were redeemed for cash and shares of AvePoint’s common stock and the outstanding shares of Legacy AvePoint’s common stock were converted into AvePoint’s common stock, representing a recapitalization, and the net assets of the Company were acquired at historical cost, with 

no  goodwill or intangible assets recorded.

Operations and assets and liabilities of the Company prior to the Apex Business Combination in these financial statements are those of Legacy AvePoint.

As a result, these financial statements represent the continuation of Legacy AvePoint and the historical stockholders’

Common stock, preferred stock and loss per share of Legacy AvePoint prior to the Apex Business Combination have been retrospectively adjusted for the Apex Business Combination using an exchange ratio of 

Options to purchase common stock of Legacy AvePoint were converted into options to purchase common stock of AvePoint, Inc.

using an exchange ratio of 

 The options, as converted, continue to be governed by Legacy AvePoint’s existing stock option plan.

The accumulated deficit of Legacy AvePoint has been carried forward after the Apex Business Combination.

All per share information in the consolidated balance sheets, consolidated statements of operations, consolidated statements of mezzanine equity and stockholders’

equity (deficiency) and the notes to consolidated financial statements have been retroactively adjusted using an exchange ratio of 

8.69144  per share.

The following transactions occurred in connection with the Apex Business Combination which impacted our mezzanine equity and permanent equity accounts:

Shares of Legacy AvePoint common stock were cancelled and converted into 103,831,523 shares of our common stock, par value $ 0.0001 per share.

2 unchanged sentences

Shares of Apex Class B common stock were cancelled and converted into 9,560,000 shares of our common stock.

Apex entered into subscription agreements with certain investors, whereby 14,000,000 shares of our Common Stock at $ 10.00  per share (“

PIPE Shares ”) for an aggregate purchase price of $ 140.0 million.

A portion of Legacy AvePoint preferred stock was cancelled and converted into 28,500,592 shares of our Common Stock.

Apex entered into subscription agreements with certain investors, whereby 14,000,000 shares of our common stock at $ 10.00  per share (“PIPE Shares”) for an aggregate purchase price of $ 140.0 million.

A portion of Legacy AvePoint preferred stock was cancelled and converted into 28,500,592 shares of our common stock.

The remaining preferred stock was redeemed for $ 130.9 million.

Options to purchase Legacy AvePoint common stock (other than certain options held by certain executives and options issued to certain employees in the People's Republic of China) were cancelled and converted into an option to purchase our Common Stock with the same terms and conditions (including vesting and exercisability terms) applicable to the corresponding former Legacy AvePoint options.

Options to purchase Legacy AvePoint common stock issued to employees in the People's Republic of China were cancelled and converted into an option to purchase our Common Stock with the same terms and conditions with the exception of fully vested options which will incur an additional month of vesting following the Business Combination to comply with local regulations.

Legacy AvePoint Officer Awards, as defined in 

"Note 13 —

Stock-Based Compensation," 

were cancelled.

Refer to 

"Note 13 —

Stock-Based Compensation" for more information.

Put options on Legacy AvePoint Modified Options and Modified Common Stock, as defined in 

"Note 13 —

Stock-Based Compensation" , were cancelled. Refer to 

"Note 13 —

Stock-Based Compensation" for more information.

We entered into earn-out agreements to issue additional shares if certain share price milestones are achieved. Refer to 

"Note 11 —

Company Earn-Out and Warrant Liabilities" for more information.

We assumed public and private placement warrants from Apex. Refer to 

"Note 11 —

Company Earn-Out and Warrant Liabilities" for more information.

As of the Closing Date and following the completion of the Business Combination, we are authorized to issue up to 1,000,000,000 shares of Common Stock at a par value of $ 0.0001 per share and up to 20,000,000 shares of preferred stock, the rights, preferences and privileges of which may be designated from time to time by our Board.

As of the Closing Date and following the completion of the Business Combination, we had the following outstanding securities:

180,272,638 shares of Common Stock;

17,905,000 warrants, each exercisable for one share of Common Stock at a price of $ 11.50 per share (the “

Warrants ”).

As a result of the Business Combination, we received net cash consideration of $ 204.5 million.

Options to purchase Legacy AvePoint common stock (other than certain options held by certain executives and options issued to certain international employees) were cancelled and converted into an option to purchase our common stock with the same terms and conditions (including vesting and exercisability terms) applicable to the corresponding former Legacy AvePoint options.

Options to purchase Legacy AvePoint common stock issued to certain international employees were cancelled and converted into an option to purchase our common stock with the same terms and conditions with the exception of fully vested options which will incur an additional month of vesting following the Apex Business Combination to comply with local regulations.

Legacy AvePoint Officer Awards, as defined in “Note 16 —

Stock-Based Compensation,” were cancelled.

Refer to “Note 16 —

Stock-Based Compensation”

for more information.

Put options on Legacy AvePoint Modified Options and Modified Common Stock, as defined in “Note 16 —

Stock-Based Compensation”, were cancelled. Refer to “Note 16 —

Stock-Based Compensation”

for more information.

We entered into earn-out agreements to issue additional shares if certain share price milestones are achieved. Refer to “Note 14 —

Company Earn-Out and Warrant Liabilities”

for more information.

We assumed public and private placement warrants from Apex. Refer to “Note 14 —

Company Earn-Out and Warrant Liabilities”

for more information.

As of the Closing Date and following the completion of the Apex Business Combination, we are authorized to issue up to 1,000,000,000 shares of our common stock at a par value of $ 0.0001 per share and up to 20,000,000 shares of preferred stock, the rights, preferences and privileges of which may be designated from time to time by our Board.

As of the Closing Date and following the completion of the Apex Business Combination, we had the following outstanding securities:

180,272,638 shares of our common stock;

17,905,000 warrants, each exercisable for one share of common stock at a price of $ 11.50 per share.

As a result of the Apex Business Combination, we received net cash consideration of $ 204.5 million.

Legacy AvePoint and Apex incurred costs that are considered direct and incremental costs associated with the transaction.

These costs amounted to $ 56.2  million and were treated as a reduction of additional paid-in capital.

Cash flows provided to or paid by Legacy AvePoint or Apex in connection with the Business Combination are included in our consolidated statements of cash flows as financing activities.

Our purchase of shares of Apex common stock prior to the Business Combination is included in our consolidated statements of cash flows as a financing cash outflow.

Cash flows provided to or paid by Legacy AvePoint or Apex in connection with the Apex Business Combination are included in our consolidated statements of cash flows as financing activities.

Our purchase of shares of Apex common stock prior to the Apex Business Combination is included in our consolidated statements of cash flows as a financing cash outflow.

The shares purchased are recorded as treasury stock.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

I-Access Acquisition

On the I-Access Closing Date, EduTech consummated its acquisition of all of the ordinary shares of I-Access.

As a result, I-Access became a wholly-owned subsidiary of EduTech.

The acquisition was made pursuant to the Share Purchase Agreement, by and among EduTech and the former I-Access shareholders.

The Company, through its subsidiary EduTech, completed the acquisition of I-Access to further expand its SaaS solutions for corporate learning and development.

The fair value of the transaction consideration totaled approximately $ 7.1  million, consisting of:

$ 1.5  million in cash, and contingent consideration measured at a fair value of $ 5.6  million on the I-Access Closing date.

The above-mentioned contingent consideration consists of:

2.98 % of EduTech common shares (of those, 

292,440  shares were issued on the I-Access Closing Date and 

30,252  shares were held in escrow pending distribution pursuant to the Adjustment for Guaranteed Minimum Revenue (as defined below));

(ii) a put option which allows sellers to cause EduTech to repurchase the shares of EduTech for approximately $ 5.9  million, upon 

24  months from Acquisition Close Date or the occurrence of certain triggering events which are in the control of the Company;

(iii) earnout in EduTech shares held in escrow at a fair value equal to revenue surplus above the agreed guaranteed minimum revenue amount, of up to approximately $ 0.7  million, or the return of EduTech shares at a fair value equal to the revenue shortfall below the agreed guaranteed minimum revenue amount, of up to approximately $ 0.7  million (together, the “

Adjustment for Guaranteed Minimum Revenue ”).

In the event of a revenue shortfall, all shares held in escrow would have been returned to EduTech.

April 15, 2022, 

the Company implemented a management changeover.

As a result, pursuant to the terms of the Share Purchase Agreement, the Adjustment for Guaranteed Minimum Revenue was cancelled and the 

292,440  EduTech shares issued as consideration on the I-Access Closing Date, the 

30,252  EduTech shares held in escrow, the put option on EduTech shares and the earnout in EduTech shares were no  longer contingent and were reclassified to mezzanine equity and included in redeemable noncontrolling interest.

The acquisition-related costs totaled $ 0.3  million and are recognized as an expense within general and administrative in the consolidated statements of operations.

Prior to being reclassified to mezzanine equity, the contingent consideration was liability classified and was measured at fair value on the I-Access Closing Date and remeasured on the date the Adjustment for Guaranteed Minimum Revenue was cancelled.

The fair value of the contingent consideration was estimated using a combination of multiple valuation methods, including discounted cash flows method, guideline public company method, and the Black-Scholes option-pricing model with the following weighted-average assumptions as of 

February 18, 2022, and 

April 15, 2022 :

February 18, 2022  

April 15, 2022  

Expected life (in years)  

Expected volatility  

Risk-free rate  

1.23 %  

Dividend  

The contingent consideration fair value estimated on the I-Access Closing Date and the date the Adjustment for Guaranteed Minimum Revenue was cancelled was

$ 5.6  million and

$ 5.8  million, respectively.

During the year ended 

December 31, 2022 , the change in the fair value of

$ 0.2  million is included within general and administrative on the consolidated statements of operations.

The financial results of I-Access have been included in our consolidated financial statements since the date of the acquisition.

The I-Access business is reported within our reportable segment.

In accordance with ASC

,  the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the I-Access acquisition as a result of book-to-tax differences primarily related to the technology and software intangibles and customer related assets.

The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the acquisition date:

Preliminary Allocation

(in thousands)

Accounts receivable, net

Prepaid expenses and other current assets

Property and equipment

Technology and software

Customer related assets

Accrued expenses and other liabilities

Current portion of deferred revenue

Other non-current liabilities

Total purchase consideration

$ 7,109  

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

The goodwill, which is generally 

not  tax-deductible, is attributed to intangible assets that do 

not  qualify for separate recognition, including the assembled workforce of the acquired business and the synergies expected to arise as a result of the acquisitions.

Intangible assets primarily relate to acquired technology and software and customer related assets.

The acquired definite-lived intangible assets are being amortized over an estimated useful life of:

10  years for technology and software on a straight-line basis;

and (ii) 1 to 10  years for customer related assets on a straight-line basis.

The estimated fair values of identifiable intangible assets were determined using the relief from royalty method which is based on the premise that the only value that a purchaser of the assets receives is the exemption from paying a royalty for its use over its remaining useful life.

Some of the significant assumptions inherent in the development of such asset valuations include revenues, royalty rate, contributory asset charges, discount rate, useful life, as well as other factors.

The fair value of intangible assets as of 

December 31, 2022 , is based on preliminary assumptions which are subject to change as we complete our valuation procedures.

Essential Acquisition

August 25, 2022, the Company acquired all of the issued and outstanding equity interest in Essential Co.

Ltd., a South Korea-based software solutions provider that will advance the Company’s ability to enable organizations to accelerate data-driven digital transformation, for a total valuation of $ 3.0  million with most of the value allocated to goodwill.

The resulting goodwill is 

not  deductible for income tax purposes.

tyGraph Companies Acquisition

September 12, 2022, 

the Company consummated its acquisition of all of the outstanding shares of tyGraph Incorporated (“

tyGraph US ”), and AvePoint Ontario Ltd.

AvePoint Ontario ”, a wholly-owned subsidiary of AvePoint) consummated its acquisition of all of the outstanding shares of tyGraph Ltd.

tyGraph Canada ”

and, collectively with tyGraph US, the “

tyGraph Companies ”).

September 12, 2022, 

tyGraph Canada was merged with and into AvePoint Ontario, with AvePoint Ontario surviving.

As a result, the tyGraph Companies became wholly-owned subsidiaries of AvePoint.

The acquisition was made pursuant to the Share Purchase Agreement, by and among AvePoint, AvePoint Ontario and the former tyGraph Companies shareholders.

The Company completed the acquisition of the tyGraph Companies to further expand its SaaS solutions for providing robust analytics capabilities that enable organizations to uncover workplace engagement.

The fair value of the transaction consideration totaled approximately $ 15.3  million, consisting of:

$ 13.8  million in cash, and 

324,845  of shares in the Company measured at a fair value of $ 1.5  million on the closing date.

The above-mentioned cash consideration (the “

tyGraph Companies Consideration ”) consisted of:

(i) the cash purchase price of $ 13.5  million;

(ii) the entire outstanding principal and interest of the loans made to certain tyGraph Companies shareholders which was approximately $ 0.2  million;

(iii) unpaid transaction costs incurred by the tyGraph Companies as of the open of business on the closing date which was approximately $ 0.1  million.

The acquisition-related costs incurred by the Company totaled $ 0.4  million and are recognized as an expense within general and administrative in the consolidated statements of operations.

The financial results of the tyGraph Companies have been included in our consolidated financial statements since the date of the acquisitions.

The tyGraph Companies businesses are reported within our reportable segment.

In accordance with ASC 805 - 740 ,  the Company established a deferred tax liability with an offset to goodwill in connection with the accounting for the opening balance sheet of the tyGraph Companies acquisitions as a result of book-to-tax differences primarily related to the technology and software intangibles and customer related assets.

The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the acquisition date:

Preliminary Allocation

(in thousands)

Accounts receivable, net

Prepaid expenses and other current assets

Property and equipment

12,193  

Customer related assets

Technology and software

Accounts payable

Accrued expenses and other liabilities

Current portion of deferred revenue

Other non-current liabilities

Total purchase consideration

$ 15,335  

The goodwill, which is generally 

not  tax-deductible, is attributed to intangible assets that do 

not  qualify for separate recognition, including the assembled workforce of the acquired business and the synergies expected to arise as a result of the acquisition.

Intangible assets primarily relate to acquired technology and software and customer related assets.

The acquired definite-lived intangible assets are being amortized over an estimated useful life of:

6  years for technology and software on a straight-line basis;

(ii) 10  years for customer related assets on a straight-line basis.

The fair value of intangible assets as of 

December 31, 2022 , is based on preliminary assumptions which are subject to change as we complete our valuation procedures.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

The changes in the carrying amounts of goodwill were as follows:

(in thousands)

Balance as of December 31, 2021

19,167  

Effect of foreign currency translation

Balance as of December 31, 2022

$ 18,904  

Intangible assets, net

Intangible assets consist of the acquired intangible assets and the self-developed software.

Amortization expense for intangible assets was $ 1.4  million for the year ended 

December 31, 2022 .

There was 

no  amortization expense for intangible assets for the year ended 

December 31, 2021.

December 31, 2022 , estimated future amortization expense for the intangible assets reflected above was as follows:

Year Ending December 31:

(in thousands)

$ 1,981  

Total intangible assets subject to amortization

$ 11,079  

A summary of the balances of the Company’s intangible assets as of 

December 31, 2022 and 2021  is presented below:

Gross Carrying Amount

Accumulated Amortization

Net Carrying Amount

Gross Carrying Amount

Accumulated Amortization

Net Carrying Amount

Weighted Average

(in thousands)

Technology and software, net

( 777 )  

Customer related assets, net

( 477 )  

( 138 )  

$ 12,471  

$ ( 1,392 )  

$ 11,079  

Concentration of Credit Risk

The Company deposits its cash with financial institutions and, at times, such balances may exceed federally insured limits.

No customer accounted for more than 10% of revenue for the years ended December 31, 2021 , 

2020  and 2019, and no  customer made up more than 10% of accounts receivable as of December 31, 2021 and 2020.

No customer accounted for more than 10% of revenue for the years ended December 31, 2022  and 

2021 , and no  customer made up more than 10% of accounts receivable as of 

December 31, 2022 and 2021 .

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Fin

ancial Statements (continued)

Notes to Consolidated Financial Statements (continued)

Accounts Receivable, Net

11 unchanged sentences

$ 55,067  

Long-term unbilled receivables were $ 6.9 million and $ 6.3 million as of December 31, 2022  and 

2021 , respectively.

Property and Equipment, Net

8 unchanged sentences

12,783  

11,206  

Less accumulated depreciation and amortization

2 unchanged sentences

$ 3,922  

Accumulated depreciation and amortization includes the amortization expense relating to assets acquired under capital leases.

Depreciation and amortization expense was $ 1.2  million, $ 1.1  million and $ 1.0  million for the years ended December 31, 2021 , 2020 and 2019, respectively.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Depreciation and amortization expense was $ 2.1  million and $ 1.2  million for the years ended December 31, 2022  and 

2021 , respectively.

Accrued Expenses and Other Liabilities

4 unchanged sentences

$ 22,740  

Current operating lease liabilities

Indirect taxes

5 unchanged sentences

$ 35,062  

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Line of Credit

On April 7 2020, Legacy AvePoint entered into a loan and security agreement (the “

Loan Agreement ”) with HSBC Ventures Bank USA Inc.

HSBC ”), a commercial bank.

On July 1, 2021, Legacy AvePoint effected an assignment of its existing rights and obligations under the Loan Agreement to AvePoint US, LLC (which, at the time of the assignment, was a wholly-owned subsidiary of ours) through entry into a limited consent and first amendment to the Loan Agreement (the “

First Amendment ,”

and the Loan Agreement as amended thereby, the “

First Amended Loan Agreement ”) and an assignment and assumption agreement (the “

First Assignment and Assumption Agreement ”).

In addition, our Board approved the entry into a pledge agreement (the “

Pledge Agreement ”) and limited guaranty (the “

Limited Guaranty ”) in favor of HSBC, pursuant to which we pledged 100 % of the AvePoint US, LLC equity held by us (the “

Pledged Equity ”) as collateral in support of the borrower’s obligations under the Amended Loan Agreement and further provided a payment guarantee to HSBC on behalf of AvePoint US, LLC equal to the value of the Pledged Equity and capped at the amount actually borrowed under the First Amended Loan Agreement.

On July 26, 2021, we effected a merger with AvePoint US, LLC, following the consummation of which we were the surviving entity (the “

Rollup Merger ”).

In connection therewith, on July 23, 2021, we entered into that certain second assignment and assumption agreement (the “

Second Assignment and Assumption Agreement ”) by and among us, AvePoint US, LLC, and HSBC, pursuant to which we would assume AvePoint US, LLC’s obligations as borrower under the First Amended Loan Agreement as of the effective time of the Rollup Merger (the “

Assumption ”).

We, the guarantors party to the Loan Agreement (the “

Guarantors ”), and HSBC also entered into that certain limited consent, dated as of July 23, 2021 ( the “

Limited Consent ”), whereby HSBC consented to the Rollup Merger, the entry into the Second Assignment and Assumption Agreement, and the Assumption, and all other actions taken by or necessary or permissible to be taken by us, AvePoint US, LLC, or the Guarantors related thereto, whether occurring prior to, on, or after the effective time of the Rollup Merger.

On October 31, 2021, we entered into that certain Second Amendment (the " Second Amendment ") to the First Amended Loan Agreement.

The First Amended Loan Agreement as amended by the Second Amendment (the " Second Amended Loan Agreement ") provides for, among other things, completion of the Post-Closing Amendments (as defined in the Limited Consent) and the removal of "Holdings" (as defined in the First Amended Loan Agreement) as a limited guarantor of the Borrower's (as defined in the First Amended Loan Agreement) obligations under the First Amended Loan Agreement and the de facto termination of the Pledge Agreement and Limited Guaranty.

The Second Amended Loan Agreement’s substantive economic terms were not amended from the original Loan Agreement, the substantive economic terms of which are described as follows:

a revolving line of credit of up to $ 30.0 million, with an additional $ 20.0 million accordion feature for additional capital we may draw at our request.

Borrowings under the line bear interest at a rate equal to LIBOR plus 3.5 %.

The Company maintains a loan and security agreement with a commercial bank. As lender for a revolving line of credit of up to $ 30.0 million, with an accordion feature that provides up to $ 20.0 million of additional borrowing capacity the Company may draw at its request.

The line bears interest at a rate equal to LIBOR plus 3.5 %.

The line carries an unused fee of 0.5 % per year.

The proceeds of borrowings under the Second Amended Loan Agreement will be used for general corporate purposes.

We, on a consolidated basis with our subsidiaries, are required to maintain a specified adjusted quick ratio, tested by HSBC each quarter.

Pursuant to the Second Amended Loan Agreement, we pledged, assigned, and granted HSBC a security interest in all shares of our subsidiaries, future proceeds, and certain assets as security for our obligations under the Second Amended Loan Agreement.

Our line of credit under the Second Amended Loan Agreement will mature on April 7, 2023.

To date, we are in compliance with all covenants under the Second Amended Loan Agreement.

We have not at any time, including as of and for the fiscal year ending December 31, 2021, borrowed under the Second Amended Loan Agreement.

The descriptions of the Loan Agreement, the First Amendment, the Second Amendment, the First Amended Loan Agreement, the Second Amended Loan Agreement, the First Assignment and Assumption Agreement, the Second Assignment and Assumption Agreement, the Limited Consent, the Pledge Agreement, and the Limited Guaranty, are qualified in their entirety by the full text of the forms of such agreements, copies of which are attached hereto as Exhibits and are incorporated herein by reference.

Under the Loan Agreement, the Company is required to maintain a specified adjusted quick ratio and a minimum annual recurring revenue tested by the Bank each quarter.

The Company pledged, assigned and granted the Bank a security interest in all shares, future proceeds and assets (except for excluded assets, including material intellectual property) as a security for the performance of the loan and security agreement obligations.

As of December 31, 2021 , the Company is in compliance with all covenants under the line and had no borrowings outstanding under the line of credit.

The line will mature on April 

 We are required to maintain a specified adjusted quick ratio and a minimum annual recurring revenue tested by the bank each quarter.

The Company pledged, assigned and granted the bank a security interest in all shares of its subsidiaries, future proceeds and assets (except for excluded assets, including material intellectual property) as security for the performance of the loan and security agreement obligations.

As of December 31, 2022, the Company is compliant with all covenants under the line and had no borrowings outstanding under the line of credit.

The Company has 

not at any time, including as of December 31, 2022 , and for the fiscal year ended December 31, 2022 , borrowed under the loan and security agreement.

Pretax loss resulting from domestic and foreign operations is as follows:

3 unchanged sentences

( 16,569 )  

( 9,205 )  

Pretax loss from continuing operations

$ ( 33,650 )  

$ ( 15,907 )  

The components of the provision (benefit) for income taxes consists of the following:

2 unchanged sentences

Current income tax expense:

$ 1,937  

State and local

2 unchanged sentences

Deferred income tax expense (benefit):

( 175 )  

State and local

( 820 )  

( 843 )  

( 323 )  

Total deferred income tax expense (benefit)

( 246 )  

( 445 )  

Total income tax expense

6 unchanged sentences

$ ( 7,067 )  

$ ( 3,340 )  

State and local income taxes, net

( 292 )  

( 519 )  

Stock-based compensation

( 51 )  

10,865  

Executive compensation limitation

Fair value of earnout liability

1 unchanged sentence

Transaction costs

( 2,209 )  

Change in valuation allowance

12,844  

Foreign operations

Return-to-Provision Adjustments

Foreign rate differential

( 2,066 )  

Return-to-provision adjustments

( 1,029 )  

2 unchanged sentences

$ 5,038  

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

The Company’s effective tax rate differed from the U.S.

federal statutory rate primarily due to mix of pre-tax income (loss) results by jurisdictions taxed at different rates than 21 %, stock-based compensation, transaction costs, Section 162 limitation, and changes in valuation allowance in certain foreign jurisdictions.

federal statutory rate primarily due to mix of pre-tax income (loss) results by jurisdictions taxed at different rates than 21 %, a permanent item recorded for the executive compensation limitation, and changes in valuation allowance in certain foreign jurisdictions.

Deferred income taxes are provided for the tax effect of temporary differences between the financial reporting basis and the tax basis of assets and liabilities.

7 unchanged sentences

Compensation and benefits

Research and development expenses

Lease liability

Foreign tax credits

Fair Value of Earn-out Liability

Total deferred tax assets

Fair value of earnout liability

35,254  

22,363  

Valuation allowance

( 20,808 )  

Deferred tax assets, net

14,446  

14,007  

Deferred tax liabilities:

7 unchanged sentences

( 1,489 )  

Right-of-use assets

( 3,402 )  

Total deferred tax liability

( 16,903 )  

Total Net Deferred Tax Assets

Net deferred tax (liabilities) assets

$ ( 2,457 )  

Valuation allowance

$ 2,738  

Net deferred tax asset

Deferred tax assets are included within other assets in the consolidated balance sheets, and deferred tax liabilities are included within other non-current liabilities in the consolidated balance sheets.

(in thousands)

Deferred tax assets, net of valuation allowance

$ 3,182  

Deferred tax liabilities

( 2,945 )  

December 

2021, the Company had net operating loss (“NOL”) carryforwards for U.S.

federal income tax of

$ 6.6 million, and state and local income tax of

$ 14.7 million, which

may offset future taxable income.

Net deferred tax (liabilities) assets

$ ( 2,457 )  

$ 2,738  

As of December 31, 2022 , the Company had net operating loss (“

NOL ”) carryforwards for state and local income tax of $ 14.6  million, which may offset future taxable income.

The state NOL carryforwards begin to expire in 2026.

The Company also has foreign NOL carryforwards of approximately

$ 35.6 million, which will expire beginning

2031 and NOL carryforward periods vary from

6 years to indefinite period.

The Company has

$ 0.7 million of foreign tax credit carryforwards available that expire in

The Company also has foreign NOL carryforwards of approximately $ 54.5  million, which will expire beginning 2024  and NOL carryforward periods vary from 6 years to indefinite period.

The Company has $ 0.3  million of foreign tax credit carryforwards available that expire in 

Under the provisions of the Internal Revenue Code, the U.S.

8 unchanged sentences

In making this assessment, management considered all available positive and negative evidence, including the level of historical taxable income, future reversals of existing temporary differences, tax planning strategies, and projected future taxable income.

On the basis of this evaluation, a valuation allowance of $ 8.4 million and $ 5.5 million was recorded as of December 

31, 2021 and December 

On the basis of this evaluation, a valuation allowance of $ 20.8 million and $ 8.4 million was recorded as of December 31, 2022  and 

2021 , respectively, against certain jurisdiction’s net deferred tax assets for which it is more likely than not that the tax benefit will not be realized.

The valuation allowance was increased by $ 2.9  million for the year ended December 31, 2021, primarily due to full valuation allowances being established for Canada, Singapore, and the United Kingdom in the current year. 

For the year ended December 

31, 2020 the valuation allowance decreased by $ 4.6 million primarily due to the utilization of NOL carryforwards in various jurisdictions.

For the year ended December 

31, 2021, the Company released valuation allowance in net deferred tax assets in Switzerland.

The Company determined that there is sufficient positive evidence to conclude that it is more likely than not that the deferred tax assets are realizable.

The Tax Cuts and Jobs Act of 2017 (the “

Act ”) subjects a U.S.

shareholder to tax on global intangible low-taxed income (“

GILTI ”) earned by certain foreign subsidiaries.

The Company has elected to account for GILTI as a period expense in the year the tax is incurred.

As a result of the Act and the current U.S taxation of deemed repatriated earnings, the additional taxes might be payable upon repatriation of foreign earnings.

The valuation allowance was increased by $ 12.5  million for the year ended December 31, 2022, primarily due to full valuation allowances being established for U.S. and Japan in the current year. 

As of December 

2 unchanged sentences

It is not practicable to estimate the amount of taxes that would be payable upon remittance of these earnings, because such tax, if any, is dependent upon circumstances existing if and when remittance occur.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest and penalties is as follows:

4 unchanged sentences

Additions based on tax positions related to the current year

Additions for tax positions of prior years

Reduction for tax positions of prior years

1 unchanged sentence

Reduction for settlements

( 935 )  

Expiration of applicable statute of limitations

1 unchanged sentence

$ 1,088  

$ 5,369  

During 2022, certain foreign jurisdiction concluded an income tax audit for prior periods which recognizes $ 0.9 million unrecognized tax benefits.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as part of the provision for income taxes.

As of December 

31, 2021, and December 

31, 2020, the Company had $ 1.3  million and $ 1.2 million, respectively, of accrued interest and penalties associated with unrecognized tax benefits.

December 31, 2022 and 2021 , the Company had $ 0.2  million and $ 1.3  million, respectively, of accrued interest and penalties associated with unrecognized tax benefits.

These amounts were included in other non-current liabilities in their respective years.

2 unchanged sentences

31, 2021, the total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was not material.

As of December 

31, 2021, the unrecognized tax benefits were reduced by approximately $ 4.0  million as a result of filing amended tax returns.

The Company files income tax returns in the U.S.

federal jurisdiction, various state and foreign jurisdictions.

The tax years 2017 through 2020 generally remain open for examination for federal, state and local tax purposes.

The tax years 2011 through 2020 are open and subject to audit by foreign jurisdictions.

The tax years 2018  through 2021  generally remain open for examination for federal, state and local tax purposes.

The tax years 2012  through 2021  are open and subject to audit by foreign jurisdictions.

To the extent utilized in future years’

tax returns, net operating loss carryforwards on December 

31, 2021 and December 

tax returns, net operating loss carryforwards on December 31, 2022 , and December 

31, 2021, will remain subject to examination until the respective tax year is closed.

The Company is obligated under various non-cancelable operating leases primarily for office space.

The initial terms of the leases expire on various dates through 

 We determine if an arrangement is a lease at inception.

Leases are classified as either operating or finance leases based on certain criteria.

This classification determines the timing and presentation of expenses on the income statement, as well as the presentation of the related cash flows and balance sheet.

Operating leases are recorded on the balance sheet beginning 

January 1, 2022, as operating lease right-of-use assets, accrued expenses and other liabilities, and long-term operating lease liabilities.

The Company currently has 

no  significant finance leases.

ROU assets and related liabilities are recorded at lease commencement based on the present value of the lease payments over the expected lease term.

Lease payments include future increases unless the increases are based on changes in an index or rate.

The rate implicit in the leases was not readily determinable, thus the Company’s incremental borrowing rate is used to calculate ROU assets and related liabilities.

The incremental borrowing rate is determined based on the Company’s estimated credit rating, the term of the lease, the economic environment where the asset resides and full collateralization.

Lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option.

We generally use the base, non-cancelable, lease term when determining the lease assets and liabilities.

Operating lease expense is recognized on a straight-line basis over the lease term and is allocated within operating expenses in the consolidated statements of operations.

The components of the Company’s operating lease expense are reflected in the consolidated statements of operations for the year ended 

December 31, 2022 , is as follows:

Year Ended December 31,

(in thousands)

Lease liability cost

$ 5,945  

Short-term lease expenses (1)

Variable lease cost not included in the lease liability (2)

Total lease cost

$ 7,966  

( 1 ) Short-term lease expenses include rent expenses from leases of 

12  months or less on the transition date or lease commencement.

( 2 ) Variable lease cost includes common area maintenance, property taxes, and fluctuations in rent due to a change in an index or rate.

Our lease agreements generally contain lease and non-lease components.

Non-lease components primarily include payments for maintenance and utilities.

We elected to combine fixed payments for non-lease components, for all classes of underlying assets, with our lease payments and account for them together as a single lease component which increases the amount of our lease assets and liabilities.

During the year ended 

December 31, 2022 , ROU assets obtained in exchange for new operating lease liabilities amounted to $ 6.9  million.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Commitments and Contingencies

Operating Leases

The Company is obligated under various non-cancelable operating leases for office space.

The initial terms of the leases expire on various dates through 2030.

During the years ended December 31, 2021 , 2020 and 2019,  total rent expense for facilities amounted to $ 6.4  million, $ 5.6 million and $ 5.4 million, respectively.

As of December 31, 2021 , letters of credit have been issued in the amount of $ 0.5 million, as security for operating leases.

The letters of credit are secured by certificates of deposit.

The future minimum rental payments for all long-term non-cancelable property leases are as follows:

Notes to Consolidated Financial Statements (continued)

Other information related to operating leases for the year ended 

December 31, 2022 , is as follows:

Year Ended December 31,

(in thousands)

Cash paid for amounts included in the measurement of the lease liability:

Operating cash flows from operating leases

$ 5,626  

December 31, 2022 , our operating leases had a weighted average remaining lease term of 

4.4 years and a weighted average discount rate of 5.1 %.

The maturity schedule of the operating lease liabilities as of 

December 31, 2022 , is as follows:

Year Ending December 31:

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$ 6,104  

Total future lease payments

18,700  

Present value adjustment

Present value of future lease payments (1)

$ 16,740  

( 1 ) Includes the current portion of operating lease liabilities of $ 5.4  million, which is reflected in accrued expenses and other liabilities in the consolidated balance sheets.

During the year ended December 31, 2021, total rent expenses amounted to $ 6.4 million.

The future minimum rental payments under ASC 

840  for all long-term non-cancelable property leases as of 

December 31, 2021, were as follows:

Year Ending December 31:

(in thousands)

$ 5,680  

$ 18,154  

Commitments and Contingencies

Purchase Commitments

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These agreements are negotiated in consideration of the volume of transactions with select suppliers and the associated required transaction volumes are expected to be met through the normal course of business.

In June 2017, the Company signed an unconditional purchase commitment in the amount of $ 8.0 million payable based upon consumption from June 2017 to June 2020.

No payments were made for the fiscal year ended 2018.

For the fiscal year ended December 

31, 2019 the Company made payments in the amount of $ 5.5 million under this agreement.

The remainder of the commitment was paid in the fiscal year ended December 31, 2020 .

In April 2019, the Company signed an unconditional purchase commitment related to the use of Microsoft Office 365 in the amount of $ 2.1 million payable in three equal installments during 2019, 2020, and 2021.

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During the year ended December 31, 2020, the Company paid $ 0.7 million related to the 2019 agreement and $ 3.1 million under the 2020 agreement for a total of $ 3.8 million.

During the year ended December 31, 2021 , the Company paid the remaining $ 0.7 million related to the 2019 agreement and $ 12.1  million related to the 2020 agreement.

The Company is obligated to make the following future minimum payments under the non-cancelable terms of these contracts as of December 31, 2021 :

During the year ended December 31, 2021, the Company paid the remaining $ 0.7 million related to the 2019 agreement and $ 12.1 million related to the 2020 agreement.

During the year ended December 31, 2022 , the Company paid $ 19.1  million related to the 2020 agreement.

In July 2022, the Company signed an unconditional purchase commitment related to the use of Microsoft Office 365 in the amount of $ 6.1 million payable in three installments during 2022, 2023, and 2024.

 During the year ended December 31, 2022, the Company paid $ 1.9 million related to the July 2022 agreement.

In December 2022, the Company signed an unconditional purchase commitment in the amount of $ 96.0 million to purchase IT solutions over a three -year term.

Under this agreement, payments are made upon access to the service and any remaining obligations due at the end of the three -year term in December 2025.

Given the Company’s history of procuring similar products, it is expected that cash payments to the supplier will occur in 2023 through 2025 with any remaining amounts coming due in 2025.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

The Company is obligated to make the following future minimum payments under the non-cancelable terms of these contracts as of 

December 31, 2022 :

Years ending December 31,

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96,000  

$ 100,239  

Legal Proceedings

In the normal course of its business, the Company may be involved in various claims, negotiations and legal actions.

Except for such claims that arise in the normal course of business, as of 

December 31, 2021, the Company was 

Except for such claims that arise in the normal course of business, as of December 31, 2022 , the Company was 

not a party to any other litigation for which a material claim is reasonably possible, probable or estimable.

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In the normal course of business, we are seldomly required to enter into service agreements that require contingency agreements with customers in highly regulated sectors. These agreements are secured by certificates of deposits.

As of December 31, 2021, letters of credit have been issued in the amount of $ 0.9 million, as security for the agreements. These agreements have not had a material effect on our results of operations, financial position or cash flow.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

As of December 31, 2022 , letters of credit have been issued in the amount of $ 2.4  million, as security for the agreements. These agreements have not had a material effect on our results of operations, financial position or cash flow.

Company Earn-Out and Warrant Liabilities

Company Earn-Out

As a result of the Business Combination, the holders of Legacy AvePoint Preferred Stock, Legacy AvePoint common stock and Legacy AvePoint Options shall be issued additional shares of AvePoint's Common Stock, as follows:

1,000,000 shares of AvePoint's Common Stock, in the aggregate, if at any time from and after the Business Combination through the seventh anniversary thereof (a) AvePoint's stock price is greater than or equal to $12.50 over any 20 Trading Days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $12.50 per share;

1,000,000 shares of AvePoint's Common Stock, in the aggregate, if at any time from and after the Business Combination through the seventh anniversary thereof (a) AvePoint's stock price is greater than or equal to $15.00 over any 20 Trading Days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $15.00 per share;

1,000,000 shares of AvePoint's Common Stock, in the aggregate, if at any time from and after the Business Combination through the seventh anniversary thereof (a) AvePoint's stock price is greater than or equal to $17.50 over any 20 Trading Days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $17.50 per share.

The rights described above are hereafter referred to as the "Company Earn-Out Shares".

To the extent that any portion of the Company Earn-Out Shares that would otherwise be issued to a holder of options that remain unvested at the date of the milestones described above, then in lieu of issuing the applicable Company Earn-Out Shares, the Company shall instead issue an award of restricted stock units of the Company for a number of shares of AvePoint's Common Stock equal to such portion of the Company Earn-Out Shares issuable with respect to the unvested options (the “Company Earn-Out RSUs”).

As a result of the Apex Business Combination, the holders of Legacy AvePoint Preferred Stock, Legacy AvePoint common stock and Legacy AvePoint Options shall be issued additional shares of AvePoint’s common stock, as follows:

1,000,000 shares of AvePoint’s common stock, in the aggregate, if at any time from and after the Apex Business Combination through the seventh anniversary thereof (a) AvePoint's stock price is greater than or equal to $12.50 over any 20 Trading Days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $12.50 per share;

1,000,000 shares of AvePoint’s common stock, in the aggregate, if at any time from and after the Apex Business Combination through the seventh anniversary thereof (a) AvePoint's stock price is greater than or equal to $15.00 over any 20 Trading Days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $15.00 per share;

1,000,000 shares of AvePoint’s common stock, in the aggregate, if at any time from and after the Apex Business Combination through the seventh anniversary thereof (a) AvePoint's stock price is greater than or equal to $17.50 over any 20 Trading Days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $17.50 per share.

The rights described above are hereafter referred to as the “Company Earn-Out Shares”.

To the extent that any portion of the Company Earn-Out Shares that would otherwise be issued to a holder of options that remain unvested at the date of the milestones described above, then in lieu of issuing the applicable Company Earn-Out Shares, the Company shall instead issue an award of RSUs of the Company for a number of shares of AvePoint’s common stock equal to such portion of the Company Earn-Out Shares issuable with respect to the unvested options (the “

Company Earn-Out RSUs ”).

In evaluation of the Company Earn-Out Shares and Company Earn-Out RSUs, management determined that the Company Earn-Out Shares represent derivatives to be marked to market at each reporting period, while the Company Earn-Out RSUs represent equity under ASC 718.

Refer to 

Refer to “

Note 16  —

Stock-Based Compensation" for more information regarding the Company Earn-Out RSUs.

Stock-Based Compensation ”

for more information regarding the Company Earn-Out RSUs.

In order to capture the market conditions associated with the Company Earn-Out Shares, the Company applied an approach that incorporated a Monte Carlo simulation, which involved random iterations that took different future price paths over the Sponsor Earn-Out Shares’

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Significant increases or decreases to these inputs in isolation could result in a significantly higher or lower liability.

Under this approach, the fair value of the Company Earn-Out Shares on July 1, 2021 was determined to be $ 29.6  million. The fair value was remeasured as of December 31, 2021  and was determined to be $ 10.0 million, and included in the earn-out shares liabilities in the consolidated balance sheets.

As a result, approximately $ 20.3 million was recognized and included as gain on earn-out and warrant liabilities in the consolidated statements of operations.

Under this approach, the fair value of the Company Earn-Out Shares on July 1, 2021, was determined to be $ 29.6  million. The fair value was remeasured as of 

December 31, 2022 and 2021 , and was determined to be $ 6.6  million and $ 10.0 million, respectively, and included in the earn-out shares’ liabilities in the consolidated balance sheets.

As a result, approximately $ 4.3 million and $ 20.3 million was recognized during the years ended 

December 31, 2022 and 2021 , respectively, and included as gain on earn-out and warrant liabilities in the consolidated statements of operations.

We estimated the earn-out shares fair value using a Monte Carlo model with the following significant unobservable assumptions:

July 1,  

December 31,  

 2021  

December 31,  

July 1,  

Term (in years)

Volatility  

40.00 %  

55.00

40.00 %  

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Warrants to Acquire Common Stock

On July 1, 2021, as part of the Business Combination, the Company effectively granted 405,000 private placement warrants with a 5 -year term and strike price of $ 11.50 per share.

On July 1, 2021, as part of the Apex Business Combination, the Company effectively granted 405,000 private placement warrants with a 5 -year term and strike price of $ 11.50 per share.

Management has determined that the private placements warrants are to be classified as liabilities to be marked to market at each reporting period.

1 unchanged sentence

Consequently, the fair value of the private placement warrants is equivalent to the quoted price of the publicly traded warrants .

 Under this approach, the fair value of the private placement warrants on July 1, 2021 was determined to be $ 1.4  million. The fair value was remeasured as of December 31, 2021  and was determined to be $ 0.5  million, and included in the other non-current liabilities in the consolidated balance sheets.

As a result, $ 0.9  million was recognized and included as gain on earn-out and warrant liabilities in the consolidated statements of operations.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

 Under this approach, the fair value of the private placement warrants on July 1, 2021, was determined to be $ 1.4  million. The fair value was remeasured as of 

December 31, 2022 and 2021 , and was determined to be $ 0.2 million and $ 0.5  million, respectively, and included in the other non-current liabilities in the consolidated balance sheets.

As a result, $ 0.2 million and $ 0.9  million was recognized during the years ended 

December 31, 2022 and 2021 , respectively, and included as gain on earn-out and warrant liabilities in the consolidated statements of operations.

Mezzanine Equity and Stockholders ’

Equity (Deficiency)

Prior to the Business Combination, the Company had 

Prior to the Apex Business Combination, the Company had 

two classes of capital stock: common stock and preferred stock.

Following the Business Combination, the Company has one class of capital stock:

Following the Apex Business Combination, the Company has one class of capital stock:

common stock. The following summarizes the terms of the Company’s capital stock.

Pursuant to the Company's restated Articles of Incorporation, the Company is authorized to issue up to 1,000,000,000  shares of common stock at $ 0.0001 par value.

There were 181,821,767 and 100,068,469  shares issued and outstanding at December 31, 2021  and December 31, 2020 , respectively. Each share of Common Stock is entitled to one vote.

Pursuant to the Company’s restated Articles of Incorporation, the Company is authorized to issue up to 1,000,000,000  shares of common stock at $ 0.0001 par value.

There were 185,277,588 and 181,821,767 shares issued and outstanding as of 

December 31, 2022 and 2021 , respectively, net of treasury shares. Each share of common stock is entitled to one vote.

The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors.

The Company’s Board of Directors has not declared common stock dividends since inception.

On July 1, 2021, as part of the Business Combination, all outstanding shares of Legacy AvePoint common stock was converted into Common Stock of AvePoint, Inc.

On July 1, 2021, as part of the Apex Business Combination, all outstanding shares of Legacy AvePoint common stock was converted into common stock of AvePoint, Inc.

using an exchange ratio of 8.69144 per share and options to purchase common stock of Legacy AvePoint were converted into options to purchase common stock of AvePoint, Inc.

using an exchange ratio of 8.6914.

 All per share information has been retroactively adjusted for this exchange ratio.

Sponsor Earn-Out Shares

On July 1, 2021, as a result of the Business Combination, the Company modified the terms of 2,916,700  shares of Common Stock (“

On July 1, 2021, as a result of the Apex Business Combination, the Company modified the terms of 2,916,700  shares of common stock (“

Sponsor Earn-Out Shares ”) then held by Apex’s sponsor, such that such shares will be subject to the following vesting provisions:

100% of the Sponsor Earn-Out Shares shall vest and be released if at any time through the seventh anniversary of the Business Combination, AvePoint's stock price is greater than or equal to $15.00 (as adjusted for share splits, share capitalization, reorganizations, recapitalizations and the like) over any 20 trading days within any 30 trading day period;

100% of the remaining Sponsor Earn-Out Shares that have not previously vested shall vest and be released if at any time through the seventh anniversary of the Business Combination, the Company consummates a subsequent transaction.

100% of the Sponsor Earn-Out Shares shall vest and be released if at any time through the seventh anniversary of the Apex Business Combination, AvePoint’s stock price is greater than or equal to $15.00 (as adjusted for share splits, share capitalization, reorganizations, recapitalizations and the like) over any 20 trading days within any 30 trading day period;

100% of the remaining Sponsor Earn-Out Shares that have not previously vested shall vest and be released if at any time through the seventh anniversary of the Apex Business Combination, the Company consummates a subsequent transaction.

The Sponsor Earn-Out Shares are currently outstanding and receive all benefits of regular shares with the exception of the fact that the shares are held in escrow and restricted from transfer until the vesting conditions described above are met.

3 unchanged sentences

Public Warrants to Acquire Common Stock

On July 1, 2021, as part of the Business Combination, the Company issued 17,500,000 public warrants with an exercise price of $ 11.50 .

Each warrant entitles the registered holder to purchase one share of AvePoint's Common Stock and the warrants are exercisable from the date of issuance through the fifth anniversary of the Business Combination. The public warrants are equity classified and its fair value, based on the publicly traded warrants, was $ 59.3 million on July 1, 2021 and included in the additional paid-in capital on the consolidated balance sheets.

On July 1, 2021, as part of the Apex Business Combination, the Company issued 17,500,000 public warrants with an exercise price of $ 11.50 .

Each warrant entitles the registered holder to purchase one share of AvePoint’s common stock and the warrants are exercisable from the date of issuance through the fifth anniversary of the Apex Business Combination. The public warrants are equity classified and its fair value, based on the publicly traded warrants, was $ 59.3 million on July 1, 2021, and included in the additional paid-in capital on the consolidated balance sheets.

December 31, 2022 , all 17,500,000 warrants remain outstanding. 

Convertible Contingently Redeemable Preferred Stock

On July 1, 2021, as part of the Business Combination, the outstanding preferred stock of the Company was redeemed for cash in part and converted into AvePoint's Common Stock in part in connection with the Business Combination with the Apex Group as described in "Note 3  —

Business Combination".

 At December 31, 2021  and December 31, 2020 , the Company was authorized to issue up to 42,000,592 shares of Series C convertible preferred stock (the “

Series C Preferred Stock ”

Preferred Stock ”) at $ 0.0001 par value, respectively.

The Company had 0 and 42,000,592  shares issued and outstanding as of December 31, 2021  and December 31, 2020 , respectively.

The Series C Preferred Stock liquidation preference was $ 403.4 million as of 

December 31, 2020 .

In addition to the Series C Preferred Stock, at December 31, 2021 , the Company was authorized to issue up to 20,000,000 of “blank check”

preferred stock, the rights, preferences and privileges of which may be designated from time to time by the Company's Board of Directors. Although authorized for issuance, no  shares of preferred stock were issued and outstanding at December 31, 2021 .

No dividends were declared related to the Preferred Stock in the years ended December 31, 2021  and 2020 .

On July 1, 2021, as part of the Apex Business Combination, the 42,000,592 outstanding preferred stock of the Company was redeemed for cash in part and converted into AvePoint’s common stock in part in connection with the Apex Business Combination with the Apex Group as described in “

Note 3  —

Business Combination ”

AvePoint, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements (continued)

Share Repurchase Program

On March 17, 2022, the Company announced that its Board of Directors authorized a new share repurchase program (the “

Share Repurchase Program ”) for the Company to buy back shares of its common stock.

Under the Share Repurchase Program, the Company has the authority to buy up to a maximum of $ 150 million of common stock shares via acquisitions in the open market or privately negotiated transactions.

The Share Repurchase Program will remain open for a period of three years from the date of authorization and may be suspended or discontinued at any time.

The Company is not obligated to make purchases of, nor is it obligated to acquire any particular amount of, common stock under the Share Repurchase Program.

During the year ended December 31, 2022, the Company purchased 4,046,186 shares at an average price of $ 4.92 .

Redeemable Noncontrolling Interest

On December 24, 2020, AEPL Pte.

(" AEPL "), an unaffiliated entity, acquired a redeemable noncontrolling interest in EduTech through the contribution of 10.0 million Singapore Dollars, which represents an investment of approximately $ 7.5 million.

As of December 31, 2020 , we owned an approximate 77.78 % interest in EduTech and AEPL owned an approximate 22.22 % interest in EduTech.

On February 11, 2021, AEPL contributed an additional 1.0 million Singapore Dollars, which represents an additional investment of $ 0.8 million.

At the transaction closing date, we owned an approximate 

76.09 % interest in EduTech and AEPL owned an approximate 23.91 % interest in EduTech.

As part of AEPL’s initial and subsequent investment in EduTech, we granted AEPL a put option which allows AEPL to cause us to repurchase AEPL’s shares in EduTech at any time between December 24, 2022 and December 24, 2023 at a price equal to AEPL’s initial and subsequent investment amounts.

On December 24, 2020, AEPL, an unaffiliated entity, acquired a redeemable noncontrolling interest in EduTech through the contribution of $ 7.5 million.

As of December 31, 2020, 

AvePoint owned a 77.78 % interest in EduTech and AEPL owned a 22.22 % interest in EduTech.

On February 11, 2021, AEPL acquired additional redeemable noncontrolling interest in EduTech through the contribution of $ 0.8 million.

At the transaction closing date, AvePoint owned a 76.09 % interest in EduTech and AEPL owned a 23.91 % interest in EduTech.

As part of AEPL’s initial and subsequent investment in EduTech, the Company granted AEPL a put option which allows AEPL to cause the Company to repurchase AEPL’s shares in EduTech at any time between December 24, 2022, and December 24, 2023, at a price equal to AEPL’s initial and subsequent investment amounts.

On February 18, 2022, EduTech consummated the acquisition of 100 % of the equity in I-Access for an aggregate purchase price of approximately $ 7.1 million.

The negotiated transaction consideration includes EduTech issuing shares and rights for shares which both also subject to a guaranteed minimum revenue provision (the “

GMR ”), and granting the former I-Access shareholders a put option which allows sellers to cause EduTech to repurchase the shares of EduTech for approximately $ 5.9 million, upon 24 months from Acquisition Close Date or the occurrence of certain triggering events which are in the control of the Company.

Under the GMR the former I-Access shareholders may have earned additional shares or return shares base on a revenue surplus and shortfall outcome.

On April 15, 2022, the Company implemented a management changeover.

As a result, pursuant to the terms of the Share Purchase Agreement, the GMR was cancelled and the 

292,440  EduTech shares issued as consideration on the I-Access Closing Date, the 

30,252  EduTech shares held in escrow, and the put option on EduTech shares were 

no  longer contingent, reclassified to mezzanine equity and included in redeemable noncontrolling interest.

From the date the GMR was cancelled to 

December 31, 2022 , AvePoint owned a 

73.82 % interest in EduTech, AEPL owned a 

23.20 % interest in EduTech and the former I-Access shareholders owned a 

2.98 % interest in EduTech.

These adjustments are recorded as net income attributable to and accretion of redeemable noncontrolling interest on the consolidated statements of mezzanine equity and stockholders' equity (deficiency).

The rollforward of the balance of the redeemable noncontrolling interest is as follows:

The roll forward of the balance of the redeemable noncontrolling interest is as follows:

noncontrolling

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Issuance of redeemable noncontrolling interest in EduTech

Net income (loss) attributable to redeemable noncontrolling interest

Other comprehensive income (loss) attributable to redeemable noncontrolling interest

Net loss attributable to redeemable noncontrolling interest

Other comprehensive income attributable to redeemable noncontrolling interest

Adjustment to present redemption value as of December 31, 2022

1 unchanged sentence

$ 14,007  

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Stock-Based Compensation

The Company maintains an equity incentive plan established in 2006, the 2006 Equity Incentive Plan (the “

The Company previously maintained the 2006 Equity Incentive Plan (the “

2006 Plan ”) and the 2016 Equity Incentive Plan (the “

2016 Plan ”).

Under the 2006 Plan, the Company may grant incentive stock options, non-qualified stock options and restricted stock to eligible recipients under the Plan which include employees, directors and consultants.

To date, the Company has issued only stock options and restricted stock.

On January 

1, 2016, the Company adopted the 2016 Equity Incentive Plan (the “

2016 Plan ”), which replaced, on a go forward basis, the 2006 Plan.

All ungranted equity reserved for issuance and not subject to outstanding awards under the 2006 Plan were assumed by the 2016 Plan and no additional equity was to be granted under the 2006 Plan.

Under both the 2006 Plan and the 2016 Plan, the Company granted incentive stock options, non-qualified stock options and restricted stock to eligible recipients which included employees, directors and consultants.

On May 27, 2021, the Company’s board of directors approved the 2021  Equity Incentive Plan (the “

2021  Plan ”), which was later approved by the Company’s shareholders on June 30, 2021.

On a going forward basis, all equity awards granted by the Company will be made pursuant to the 2021 Plan and no  additional equity will be granted under the 2016 Plan, or, for the avoidance of doubt, the 2006 Plan.

As of December 31, 2021 , 43,238,067 common shares remained for future issuance under the Plans.

Plan ”), which succeeded the 2016 Plan.

As of the adoption of the 2021 Plan, all equity awards granted under the 2021 Plan and no equity is granted under the 2016 Plan, or, for the avoidance of doubt, the 2006 Plan.

As of December 31, 2022 , 

20,298,497 shares remained for future issuance under the 2021 Plan.

All outstanding stock awards granted under the 2006 Plan and 2016  Plan will remain subject to the terms and conditions of the 

2006 Plan and 2016 Plan, respectively, and the provisions of any award agreements made thereunder.

The Company records stock-based compensation in cost of revenue, sales and marketing, general and administrative and research and development.

Stock-based compensation was included in the following line items:

To date, the Company has issued only stock options, restricted stock and restricted stock units to employees, directors and consultants.

Stock-based compensation was included in the following line items in the consolidated statements of operations:

Year Ended December 31,

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$ 2,640  

$ 3,477  

Sales and marketing

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$ 59,508  

$ 13,893  

Total tax benefit related to vested or exercised awards during the year ended December 31, 2022 and 2021 was $ 2.2  million and $ 0.03 million, respectively.

Stock Options

The compensation costs for stock option awards are accounted for in accordance with ASC 718, Compensation-Stock Compensation .

Stock options vest over a four -year period and expire on the tenth anniversary of the date of award.

Stock options vest over a four -year service period and expire on the tenth anniversary of the date of award.

Certain of the Company’s stock option awards (the “

Officer Awards ”) included a provision that required the Company to redeem the vested portion of options at fair value in cash upon a separation of service initiated by the Company or upon death or disability of the holder.

The Company determined that the redemption feature required the Officer Awards to be classified in mezzanine equity prior to the Business Combination.

The Company determined that the redemption feature required the Officer Awards to be classified in mezzanine equity prior to the Apex Business Combination.

For share-based payment arrangements with employees, the amount presented in mezzanine equity at each balance sheet date was based on the redemption provisions of the instrument and adjusted for the proportion of consideration received in the form of employee services.

1 unchanged sentence

not probable;

therefore, the Company reclassified the grant-date intrinsic value to mezzanine equity as the awards vested. The Officer Awards were cancelled concurrent with the Business Combination.

In exchange for the cancellation of the Officer Awards, the Company agreed to deliver to the holders of the Officer Awards a fixed amount of shares equal to the amount of shares the holders would have received if the Officer Awards were exercised on the date of the Business Combination in a net share settlement scenario.

As a result, the Company will issue 3,592,504  shares. The shares issuable on July 1, 2022 in exchange for the cancelled Officer Awards is treated as modification of the original awards under ASC 718;

therefore, the Company reclassified the grant-date intrinsic value to mezzanine equity as the awards vested. The Officer Awards were cancelled in 2021, concurrent with the Apex Business Combination.

In exchange for the cancellation of the Officer Awards, the Company agreed to deliver to the holders of the Officer Awards a fixed amount of shares equal to the amount of shares the holders would have received if the Officer Awards were exercised on the date of the Apex Business Combination in a net share settlement scenario.

The cancelled Officer Awards were treated as modification of the original awards under ASC 718;

however, no incremental value exists as a result of the modification. As a result of the cancellation of the original Officer Awards, the $ 1.7  million mezzanine balance was reclassified to permanent equity on July 1, 2021, and the Company recognized $ 3.5  million in previously unrecognized compensation costs.

As a result, the Company issued 3,592,504  shares in July 

AvePoint, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements (continued)

The Company’s stock option awards granted to certain international employees (the "Legacy International options") contained a performance condition that stated that the awards are only exercisable if the Company’s common shares are publicly traded.

When the exercise contingency was resolved upon completion of the Business Combination, the Legacy International Options were cancelled and replaced with new awards with substantially the same terms and conditions (the " International Options ").

Prior to the Business Combination, no compensation expense related to the Legacy International Options was recognized, as the exercise contingency was not deemed probable until the occurrence of the Business Combination.

Had the exercise contingency been deemed probable, the Legacy International Options would have been classified as liabilities. After the Business Combination vested International Options can be exercised utilizing broker-assisted settlements;

The Company’s stock option awards granted to certain international employees (the “

Legacy International Options ”) contained a performance condition that stated that the awards are only exercisable if the Company’s common shares are publicly traded.

When the exercise contingency was resolved upon completion of the Apex Business Combination, the Legacy International Options were cancelled and replaced with new awards with substantially the same terms and conditions (the “

International Options ”).

Prior to the Apex Business Combination, no compensation expense related to the Legacy International Options was recognized, as the exercise contingency was not deemed probable until the occurrence of the Apex Business Combination.

Had the exercise contingency been deemed probable, the Legacy International Options would have been classified as liabilities. After the Apex Business Combination vested International Options can be exercised utilizing broker-assisted settlements;

therefore, the International Options are classified as equity.

As a result of this change in classification, the Company calculated the fair value of the awards on July 1, 2021 for purposes of compensation expense. In the period the exercise contingency is resolved ASC 718 the immediate recognition of all previously unrecognized compensation since the original grant date.

As a result, the Company recognized a one -time charge of $ 24.3  million in previously unrecognized compensation costs. 

As a result of this change in classification, the Company calculated the fair value of the awards on July 1, 2021, for purposes of compensation expense.

In accordance with ASC 718, all previously unrecognized compensation since the grant date was immediately recognized upon resolution of the exercise contingency. As a result, in 2021 the Company recognized a one -time charge of $ 24.3  million in previously unrecognized compensation costs. 

In 2020, the Company granted certain executives stock option awards that contain both service and performance vesting conditions (the “

Time and Performance Based Options ”).

The Time and Performance Based Options were granted in three tranches (the " Time-Based Options ," the " Performance-Based 1 Options ," and the " Performance-Based II Options ").

The Time-Based Option vests 25  percent one year after the grant date and, thereafter, in 12 successive equal quarterly installments measured from the first anniversary, subject to the grantee’s continuous service with the Company.

The Time and Performance Based Options were granted in three tranches (the “

Time-Based Options ,”

Performance-Based 1 Options ,”

and the “

Performance-Based II Options ”).

The Time-Based Option vests over a four -year period, subject to the grantee’s continuous service with the Company.

The Performance-Based I Option vests contingent upon the Company meeting certain performance goals.

3 unchanged sentences

Both the Performance-Based I Option and Performance-Based II Option are subject to the grantee’s continuous service to the company. 

On September 1, 2021, the Company granted 5,611,658  options under the 

2021 Plan. The weighted-average grant date fair value of options granted in the years ended December 31, 2021, 2020 and 2019 was $ 4.09 per share, $ 1.63 per share, and $ 0.68 per share, respectively.

The Company estimated the grant date fair value of these stock options and the International Options using a Black-Scholes option-pricing model with the following weighted-average assumptions:

July 1,  

September 1,  

 2021  

The weighted-average grant date fair value of options granted in the year ended 

December 31, 2022 and 2021  was $ 2.71 and $ 4.09 , respectively.

The Company calculates the expected term using the “simplified”

method, which is the simple average of the vesting period and the contractual term.

The simplified method is applied as the Company does not have sufficient historical data to provide a reasonable basis for an estimate of the expected term.

Expected volatility is based on historical and implied volatility of a group of peer entities over a similar expected term.

Dividend yields are based upon historical dividend yields.

Risk-free interest rates are based on the implied yields currently available on U.S.

Treasury zero coupon issues with a remaining term equal to the expected term.

The Company estimated the grant date fair value of these stock options using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Expected term (in years)  

4 unchanged sentences

Dividend yield  

To estimate the expected term of stock options, the Company considered the vesting term, contractual expiration period, and market conditions.

Expected volatility is based on historical volatility of a group of peer entities.

Dividend yields are based upon historical dividend yields.

Risk-free interest rates are based on the implied yields currently available on U.S.

Treasury zero coupon issues with a remaining term equal to the expected term.

Based on these inputs, the grant-date fair value of the September 2021 granted options was determined to be $ 23.0 million. 

A summary of the Company’s stock option activity during the year ended 

December 31, 2022  is as follows:

Stock Options

Weighted-Average Exercise Price

Weighted-Average Remaining Contractual Life

Aggregate Intrinsic Value

(Aggregate Intrinsic Value figure presented in thousands)

Balance, January 1, 2022

30,480,317  

Options granted

$ 3.87  

Options exercised

689,406  

Options forfeited or expired

( 1,799,665 )  

Balance, December 31, 2019

24,926,640  

Options granted

11,537,242  

Options exercised

( 707,888 )  

Options forfeited or expired

( 898,926 )  

Balance, December 31, 2020

34,857,068  

Options granted

5,611,658  

Options exercised

( 5,141,331 )  

Options forfeited or expired

Forfeited or expired

( 202,255 )  

2 unchanged sentences

$ 4.05  

$ 92,600  

At December 31, 2021, the following table summarizes information about outstanding and exercisable stock options:

As of December 31, 2022 , the following table summarizes information about outstanding and exercisable stock options:

Exercise Price

20 unchanged sentences

$ 2.96  

As of December 31, 2021  and December 31, 2020 , there was $ 42.7  million and $18.4 million, respectively, in unrecognized compensation costs related to all non-vested awards.

At December 31, 2021 , the Company had 30,480,317  options outstanding and 15,375,845 options exercisable with intrinsic values of $ 92.6  million and $ 66.1  million, respectively.

During the year ended December 31, 2021 , 5,141,331 options were exercised, with a total intrinsic value of $ 40.0  million.

December 31, 2022 , there was $ 25.5  million in unrecognized compensation costs related to all non-vested options.

This unrecognized stock-based compensation cost is expected to be recognized over a weighted-average period of approximately 2.3 years.

December 31, 2022 , the Company had 29,167,803 options outstanding and 19,457,559  options exercisable with intrinsic values of $ 33.8 million and $ 32.0 million, respectively.

During the year ended December 31, 2022 , 1,799,665 options were exercised, with a total intrinsic value of $ 6.6 million.

During the year ended December 31, 2021, 5,141,331 options were exercised, with a total intrinsic value of $ 40.0 million.

Restricted Stock Units

In addition to Stock Options granted under the 2006 Plan, 2016 Plan and 2021 Plan, 5,445,542 Restricted Stock Units ("RSUs") were granted under the 2021 Plan on September 1, 2021.

In addition to Stock Options granted under the 2006 Plan, 2016 Plan and 2021 Plan, 5,749,764 RSUs were granted under the 2021 Plan in 2022.

The compensation costs for stock option awards are accounted for in accordance with ASC 718, Compensation-Stock Compensation.

RSUs vest over a four -year period and expire on the tenth anniversary of the date of award.

The RSUs are measured at the fair market value of the underlying stock at the grant date.

The weighted-average grant date fair value of RSUs granted in the year ended December 31, 2021 was $ 9.64 .

For the year ended December 31, 2021 , the Company recorded stock-based compensation expense of $ 6.2  million related to the RSUs granted under the 2021 Plan.

As of December 31, 2021 , there was $ 45.2  million in unrecognized compensation costs specific to the non-vested RSUs under the 2021 Plan.

RSUs vest over a four -year service period and expire on the tenth anniversary of the date of award.

The RSUs are measured at the fair market value of the underlying stock at the grant date. 

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

A summary of the Company’s RSU activity during the year ended 

December 31, 2022  is as follows:

Unvested Restricted Stock Units

Number of Shares

Weighted-Average Grant-Date Fair Value

Unvested as of December 31, 2021

5,167,479  

$ 9.64  

5,749,764  

( 1,784,993 )  

( 739,707 )  

Unvested as of December 31, 2022

8,392,543  

$ 7.10  

The per share weighted-average grant date fair value of RSUs granted during the year ended 

December 31, 2022 and 2021  was $ 5.55  and $ 9.64 , respectively.

The total fair value of shares vested during the year ended December 31, 2022 and 2021  was $ 8.2 million and $ 9.5 million, respectively.

December 31, 2022 , there was $ 53.0 million in unrecognized compensation costs specific to the non-vested RSUs under the 2021 Plan.

This unrecognized stock-based compensation cost is expected to be recognized over a weighted-average period of approximately 2.9 years.

Company Earn-Out RSUs

4 unchanged sentences

Under this approach, the grant-date fair value of the Company Earn-Out RSUs on July 1, 2021, was determined to be $ 2.5  million.

The stock options underlying the Earn-Out RSUs vest over a four -year period and expire on the tenth anniversary of the date of award. If the contingent milestones of the Earn-Out RSUs are not met by the seventh anniversary of the Business Combination, the holders of the underlying stock options will not receive the Earn-Out RSUs.

For the year ended December 31, 2021 , the Company recorded stock-based compensation expense of $ 0.4  million related to these Earn-Out RSUs.

The stock options underlying the Earn-Out RSUs vest over a four -year period and expire on the tenth anniversary of the date of award. If the contingent milestones of the Earn-Out RSUs are not met by the seventh anniversary of the Apex Business Combination, the holders of the underlying stock options will not receive the Earn-Out RSUs.

For the years ended 

December 31, 2022 and 2021 , the Company recorded stock-based compensation expense of $ 0.9 million and $ 0.4  million, respectively, related to these Earn-Out RSUs.

Put and Call Options

On December 

26, 2019, the Company granted put options, to certain of the Company’s management, to request a redemption of 3,113,170 shares of Common Stock (“Modified Common Stock”) or 5,148,777 shares underlying options to acquire Common Stock (Modified Options, collectively, “Eligible Shares”) during the period from March 

25, 2025 to April, 2025 ( the “Settlement Period”) or, if earlier, the 30 day period following a Qualifying Termination for a redemption price per share equal to the fair market value, as determined by the AvePoint’s Board of Directors;

26, 2019, the Company granted put options, to certain of the Company’s management, to request a redemption of 3,113,170 shares of common stock (“

Modified Common Stock ”) or 5,148,777 shares underlying options to acquire common stock (“

Modified Options ”, collectively, “

Eligible Shares ”) during the period from March 

25, 2025, to April, 2025 ( the “

Settlement Period ”) or, if earlier, the 30 day period following a Qualifying Termination for a redemption price per share equal to the fair market value, as determined by the AvePoint’s Board of Directors;

provided, that if a redemption request is delivered following a Qualifying Termination, the Company shall pay the redemption price during the Settlement Period unless the holders of Series C Preferred Stock consent to the payment of the redemption price by the Company within the 30 day period following the Qualifying Termination.

In addition, the Company has a right to purchase all or any portion of the Eligible Shares at any time for a purchase price per share equal to the fair market value.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Mezzanine equity classification is required if stock awards that would otherwise qualify for equity classification are subject to contingent redemption features that are not solely within the control of the issuer.

The Company remeasures the Modified Common Stock at each balance sheet date based on the fair value of the Company’s shares and such remeasurements are reflected as an adjustment of the value in mezzanine equity.

As of December 31, 2021  and December 31, 2020 , the mezzanine equity balance related to the Modified Common Stock was $ 0  and $ 25.1 million, respectively.

The Company remeasured the Modified Common Stock at each balance sheet date based on the fair value of the Company’s shares and such remeasurements are reflected as an adjustment of the value in mezzanine equity.

In 2019, the Company recorded a one -time stock-based compensation expense of $ 0.5 million, related to Modified Common Stock.

These costs have been recorded in operating expenses in the consolidated statements of operations.

The fair values of Modified Options were estimated using a Black-Scholes option-pricing model with the following weighted-average assumptions at July 1, 2021 and December 31, 2020 :

In connection with the Apex Business Combination, the agreements creating the Modified Common Stock and Modified Options were terminated.

As a result, the $ 39.3  million mezzanine balance and the $ 49.7  million liability balance were reclassified to permanent equity on July 1, 2021.

The fair values of Modified Options were estimated using a Black-Scholes option-pricing model with the following weighted-average assumptions on 

July 1, 2021:

Expected term (in years)

2 unchanged sentences

Dividend yield

At December 31, 2021  and December 31, 2020 , the liability balance related to Modified Options was $ 0  and $ 36.8 million, respectively.

For the years ended December 31, 2021 and 2020, the Company recorded stock-based compensation expenses of $ 11.8 million and $ 29.6 million, respectively, related to these options.

For the year ended December 31, 2021, 

the Company recorded stock-based compensation expenses of $ 11.8 million, related to these options.

These costs have been recorded in costs of revenue and operating expenses in the consolidated statements of operations.

During 2021 and 2020, 1,365,503 and 19,443 , respectively, December 31, 2021  options included in Modified Options were exercised and during 2020, 60,000 restricted shares issued in exchange for the nonrecourse promissory note described above were settled.

As a result of exercises of the Modified Options and issuance of restricted shares, during 2021 and 2020, $ 15.4 million and $ 5.8 million, respectively, of the liability balance related to Modified Options was reclassified to liability-classified outstanding shares within the six months from the time of exercise.

During 2021 and 2020, $ 6.9 million and $ 0 , respectively, of the liability balance for these outstanding shares was reclassified to mezzanine equity as a result of the completion of six months from the time of the exercise of 690,474  options. At July 1, 2021, the Business Combination date, and December 31, 2020 , the liability balance related to this Modified Common Stock was $ 49.7  and $ 6.7 million, respectively.

For the year ended December 31, 2021 , the Company recorded stock-based compensation expense of $ 1.2 million and $ 0.9 million, respectively, related to this Modified Common Stock. 

In connection with the Business Combination, the agreements creating the Modified Common Stock and Modified Options were terminated.

As a result, the $ 39.3  million mezzanine balance and the $ 49.7  million liability balance were reclassified to permanent equity on July 1, 2021.

During 2021, 1,365,503  options included in Modified Options were exercised.

As a result of exercises of the Modified Options during 2021, $ 15.4 million of the liability balance related to Modified Options was reclassified to liability-classified outstanding shares within the six months from the time of exercise.

During 2021, $ 6.9 million of the liability balance for these outstanding shares was reclassified to mezzanine equity as a result of the completion of six months from the time of the exercise of 690,474  options. As of July 1, 2021, the Apex Business Combination date, the liability balance related to this Modified Common Stock was $ 49.7 million.

For the year ended 

December 31, 2021 , the Company recorded stock-based compensation expense of $ 1.2 million, related to this Modified Common Stock.

AvePoint, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements (continued)

Financial Instruments

7 unchanged sentences

Level 3 — Unobservable inputs for the asset or liability.

Year Ended December 31, 2021

(in thousands)  

Level 1

Level 2  

Level 3  

Assets  

Year Ended December 31,

(in thousands)

Cash Equivalents:

treasury bills  

Certificates of deposit

$ 1,693  

Certificate of deposits  

188,769  

Short term investments:

Certificate of deposits  

Other assets:

Certificate of deposits  

Certificates of deposit

Other assets:

Certificates of deposit

$ 193,244  

Liabilities  

Earn-out liabilities (1)  

Earn-out shares (1)

$ 6,631  

Warrant liabilities (1)  

$ 6,631  

$ 6,858  

Year Ended December 31, 2020

(in thousands)  

Level 1

Level 2  

Level 3  

Assets  

Year Ended December 31,

(in thousands)

Cash Equivalents:

Certificate of deposits  

treasury bills

$ 199,999  

Certificates of deposit

Short term investments:

Certificate of deposits  

Certificates of deposit

Other assets:

Certificate of deposits  

Certificates of deposit

$ 204,128  

( 1 ) As a result of the Business Combination on July 1, 2021, the Company recorded Company Earn-Out Shares and private placement warrants as liabilities that must be marked to market each reporting period.

Earn-out shares (1)

$ 10,012  

Warrant liabilities (1)

$ 10,012  

$ 10,470  

( 1 ) As a result of the Apex Business Combination on July 1, 2021, the Company recorded Company Earn-Out Shares and private placement warrants as liabilities that must be marked to market each reporting period.

The Company measured the Company Earn-Out Shares at fair value determined at Level 3.

The Company measured the private placement warrants at fair value determined at Level 2.

Refer to "Note 11 —

Company Earn-Out and Warrant Liabilities" for further details.

Refer to “

Note 14  —

Company Earn-Out and Warrant Liabilities ”

for further details.

The following table presents the reconciliation in Level 3 instruments which consisted of earn-out shares liabilities which were measured on a recurring basis for the year ended December 31, 2022.

Year Ended December 31,

(in thousands)

Opening balance

$ 10,012  

Total gains or losses from the period

Included in earnings

Reclass from Earnout-RSU

Closing balance

$ 6,631  

AvePoint, Inc.

8 unchanged sentences

The CODM does not receive discrete financial information about asset allocation, expense allocation or profitability by product or geography.

Revenue by geography are based upon the billing address of the customer.

Revenue by geography is based upon the billing address of the customer.

All transfers between geographic regions have been eliminated from consolidated revenue.

No customers represented greater than 10% of revenue for the years ended December 31, 2021 , 2020 and 2019.

No customers represented greater than 10% of revenue for the years ended December 31, 2022  and 

2021 . The following table sets forth revenue by geographic area:

1 unchanged sentence

(in thousands)

United States

$ 83,034  

$ 67,823  

$ 48,614  

North America

$ 102,025  

7 unchanged sentences

$ 191,909  

$ 116,099  

The following table sets forth revenue generated from customers by country, based outside of the United States, and represent more than 10% of the total consolidated revenue:

The following table sets forth revenue generated from customers by country, which represents more than 10% of total consolidated revenue in any period presented:

Year Ended December 31,

(in thousands)

$ 23,574  

$ 17,650  

$ 15,094  

23,360  

17,331  

16,619  

United States

$ 100,870  

8 unchanged sentences

United States

$ 1,279  

Total property and equipment, net

5 unchanged sentences

Loss Per Share

Basic loss per share available to the Company's common shareholders (“

Basic loss per share available to the Company’s common shareholders (“

EPS ”) is computed by dividing net loss by the weighted average number of common shares outstanding for the period.

1 unchanged sentence

The Company applies the two -class method in calculating loss per share.

the Company's Sponsor Earn-Out Shares described in " Note 12 —

the Company’s Sponsor Earn-Out Shares described in “

Note 15  —

Mezzanine Equity and Stockholders’

Deficiency " are considered participating securities and have no contractual obligation to shares in the loss of the Company.

 Deficiency ”

are considered participating securities and have no contractual obligation to shares in the loss of the Company.

As such, the weighted-average impact of these shares is excluded from the calculation of loss per share below.

3 unchanged sentences

per share amounts)

Loss per share available to common shareholders, excluding sponsor earn-out shareholders

$ ( 33,245 )  

Loss per share available to common stockholders, excluding sponsor earn-out stockholders

$ ( 38,688 )  

1 unchanged sentence

( 2,942 )  

( 27 )  

Net loss attributable to AvePoint, Inc.

$ ( 41,630 )  

$ ( 16,996 )  

Deemed dividends on preferred stock

( 32,928 )  

( 34,446 )  

Total net loss available to common shareholders

$ ( 68,147 )  

Total net loss available to common stockholders

$ ( 41,630 )  

$ ( 127,643 )

Weighted average common shares outstanding

1 unchanged sentence

141,596  

74,006  

Effect of dilutive securities

2 unchanged sentences

141,596  

74,006  

Basic loss per share available to common shareholders, excluding sponsor earn-out shareholders

$ ( 0.48 )  

$ ( 0.57 )  

Diluted loss per share available to common shareholders, excluding sponsor earn-out shareholders

$ ( 0.48 )  

Basic and diluted loss per share available to common stockholders, excluding sponsor earn-out stockholders

$ ( 0.23 )  

To arrive at net loss available to common shareholders, the Company deducted net income attributable to the redeemable noncontrolling interest in EduTech and deemed dividends, which related to the redemption, extinguishment, and remeasurement of preferred stock.

For the years ended December 31, 2021 , 

2020  and 2019, the Company's potentially dilutive securities were deemed to be anti-dilutive given the Company’s net loss position.

To arrive at net loss available to common stockholders, the Company deducted net income attributable to the redeemable noncontrolling interest in EduTech and deemed dividends, which related to the redemption, extinguishment, and remeasurement of preferred stock.

For the years ended December 31, 2022  and 

2021 , the Company’s potentially dilutive securities were deemed to be anti-dilutive given the Company’s net loss position.

As such, basic loss per share is equal to diluted loss per share for the periods presented.

The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted-average shares outstanding because such securities has an antidilutive impact due to losses reported:

Year Ended December 31,

(in thousands)

Convertible preferred stock

42,001  

51,091  

Restricted stock

Stock options

1 unchanged sentence

30,480  

24,927  

Restricted stock units

17,905  

Company Earn-Outs

2 unchanged sentences

56,552  

78,625  

Related Party Transactions

6 unchanged sentences

The following material subsequent events occurred since the date of the most recent balance sheet period reported.

I-Access Solutions Pte.

On February 18, 2022 ( the “

Acquisition Close Date ”), EduTech consummated an acquisition of all of the ordinary shares of I-Access Solutions Pte.

I-Access ”), a Singapore-based software company established as a leading provider of SaaS solutions for corporate learning and development.

Transaction consideration totaled approximately $ 7.4 million, consisting of $ 1.5 million in cash and $ 5.9 million of issuance of ordinary shares of EduTech.

Approximately 9.5 % of the equity consideration is being held in escrow, subject to I-Access achieving certain revenue targets for fiscal year 2022 and 2023.

The $5.9  million equity consideration is subject to a put option which allows sellers to cause EduTech to repurchase the shares of EduTech for $5.9 million, upon 24 months from Acquisition Close Date or the occurrence of certain triggering events which are in the control of the Company.

The initial allocation of the purchase price is still being assessed by the Company.

Significant, relevant information needed to complete the initial accounting is not available because the valuation of assets acquired and liabilities assumed is not complete.

As a result, determining these values is not practicable, and we are unable to disclose these values or provide other related disclosures at this time.

Share Repurchase Program

On March 17, 2022, 

the Company announced that its Board of Directors authorized a new share repurchase program (the “

Share Repurchase Program ”) for the Company to buy back shares of its Common Stock.

Under the Share Repurchase Program, the Company has the authority to buy up to a maximum of $ 150 million of Common Stock shares via acquisitions in the open market or privately negotiated transactions.

The Share Repurchase Program will remain open for a period of three years from the date of authorization.

The Company is not obligated to make purchases of, nor is it obligated to acquire any particular amount of, Common Stock under the Share Purchase Program.

The Share Repurchase Program may be suspended or discontinued at any time.

As of the date of this Annual Report, the Company has purchased 135,000 shares at an average price of $ 5.49 under the Share Repurchase Program.

Stock Based Compensation 

On March 21, 2022 we granted 4,159,532 RSUs and 689,406 options to employees in total fair value of $ 26.3 million.

Stock-Based Compensation

On March 13, 2023, we granted 6,349,464  RSUs and 1,125,374 options to employees in total fair value of $ 29.6 million.

In conjunction with the business combination between Apex and Legacy AvePoint, Apex issued a proxy statement on June 2, 2021, which among other things, sought the approval of a new charter by “the affirmative majority (virtually in person or by proxy) of holders of a majority of the outstanding shares of Apex voting together as a single class and a majority of the outstanding shares of Class B common stock voting separately as a single class”

(the “

Charter Proposal ”).

At a special meeting held on June 30, 2021, the combined vote of a majority of the voting power of the Class A common stock and Class B common stock, voting together as one class, approved the Charter Proposal. The Company obtained the separate class vote of the Class B common stock as well. According to the number of shares of common stock outstanding and the tabulated votes for and against the Charter Proposal, the Charter Proposal was not approved by a majority of the Class A common stock then outstanding. Believing it had obtained the stockholder votes required by the old charter and Delaware law, the Company filed the new charter with the State of Delaware on July 1, 2021. 

On and after that date, the Company issued common stock and securities pursuant to the new charter.

A recent decision of the Delaware Court of Chancery has created uncertainty as to whether Section 242 (b)( 2 ) of the Delaware General Corporation Law would have required the Charter Proposal to be approved by a separate vote of the majority of the Company’s then-outstanding shares of Class A common stock, in addition to a majority of the shares of Class A and Class B common stock voting together (“

Boxed Decision ”).

While the Company believes that the Company's shares have been validly authorized since their original issuance, in light of the Boxed Decision, on March 2, 2023, the Company petitioned the Court of Chancery to validate the Charter and the securities issued in reliance on the Charter (the “Petition”). In the Petition, the Company represented to the Court of Chancery that the Company filed the Charter with the belief that it had been approved in accordance with Delaware law and that the Company filed the Petition in response to the publication of the Boxed decision.

In response to the Petition, the Court of Chancery granted an order on March 17, 2023 ( the “

Order ”), and stated in the Order that:

“The Charter, including the filing and effectiveness thereof, is hereby validated and declared effective retroactive to the date of its filing with the Office of the Secretary of State of the State of Delaware on July 1, 2021, and all amendments effected thereby.”

“The Company’s securities (and the issuance of the securities) described in the Petition and any other securities issued in reliance on the validity of the Charter are hereby validated and declared effective as of the original date of issuance of such securities.” 

The Court’s granting of the Order has addressed and eliminated the uncertainty created by the Boxed Decision.

Items 9 and 9A

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We maintain “disclosure controls and procedures,”

as defined in Rule 13a–15(e) and Rule 15d–15(e) under the Exchange Act, that are designed to provide reasonable assurance that information required to be disclosed by the Company in the 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.

Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer (in his capacity as principal executive officer) and our Chief Financial Officer (in his capacity as principal financial and accounting officer), as appropriate to allow timely decisions regarding required disclosure.

as defined in Rule 13a–15(e) and Rule 15d–15(e) under the Exchange Act, that are designed to provide reasonable assurance that information required to be disclosed by us in the 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.

Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer (in his capacity as principal executive officer) and our Chief Financial Officer (in his capacity as principal financial and accounting officer), as appropriate to allow timely decisions regarding required disclosure.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e)) under the Exchange Act, as of the end of the period covered by this Annual Report.

Based upon that evaluation, our principal executive officer and principal financial and accounting officer concluded that our disclosure controls and procedures were not effective as of December 31, 2021 due to the material weaknesses described below.

Notwithstanding such material weaknesses in internal control over financial reporting, our principal executive officer and principal financial and accounting officer have concluded that our audited Consolidated Financial Statements included in this Annual Report present fairly, in all material respects, our financial position, results of operations, and cash flows for the periods presented in conformity with U.S.

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Because the control deficiencies described below could have resulted in a material misstatement of our annual or interim financial statements, we determined that these deficiencies constitute material weaknesses.

Based upon the evaluation described above, our management identified the following material weaknesses in internal control over financial reporting in fiscal year 2020 which continued to exist in fiscal year 2021:

the completeness and accuracy of financial accounting, reporting and disclosures;

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Our management has been and continues to be committed to remediating these material weaknesses and has identified and implemented several steps to enhance our internal controls over financial reporting.

We have implemented a remediation plan (the " Remediation Plan "), the actions under which coincide with and are incorporated into our overarching Sarbanes-Oxley Act of 2002 (“

SOX ”) compliance implementation plan.

We have implemented a remediation plan (the " Remediation Plan "), the actions under which coincide with and are incorporated into our overarching Sarbanes-Oxley Act of 2002 compliance implementation plan.

The Remediation Plan actions include, but are not limited to:

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the implementation of improved accounting and financial reporting procedures to enhance the completeness and accuracy of our financial accounting, reporting, and disclosures.

We are in the process of completing our remediation plan, and we are currently testing that the newly implemented controls are operating effectively.

The remaining elements of our Remediation Plan can only be accomplished over time, and we can offer no assurance that these initiatives will remediate the identified material weaknesses.

We intend to complete the remaining portions of our Remediation Plan as promptly as possible.

However, we cannot estimate how long it will take to correct any remaining material weaknesses that have not yet been remediated.

Identified 

material weaknesses will not be considered remediated until a sustained period of time has passed to allow our management to test the design and operational effectiveness of the corrective actions pursuant to the Remediation Plan.

We have implemented documented policies and procedures for, and are in the process of testing the implementation and operating effectiveness of, the newly designed controls.

The material weakness in our internal control over financial reporting will not be considered remediated until the newly designed controls operate for a sufficient period of time.

In addition, we may discover additional material weaknesses that require additional time and resources to remediate, and we may decide to take additional measures to address the material weaknesses or modify the remediation steps described above.

We will continue to perform additional analyses and other procedures to ensure that our consolidated financial statements are prepared in accordance with GAAP.

No Management Report on Internal Control Over Financial Reporting or an Attestation Report of our Independent Registered Accounting Firm

This Annual Report does not include (A) a report of management’s assessment regarding our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) (“

ICFR ”) or (B) an attestation report of our independent registered accounting firm, Deloitte & Touche LLP (PCAOB ID No.

With respect to the exclusion of management’s report on its assessment of our ICFR in this Annual Report, such exclusion is permissible when a reverse acquisition between an issuer and a private operating company has occured where the surviving issuer is not a "newly public company" as that term is used in Exchange Act Release No.

15, 2006) and when it is not possible to conduct an assessment of the private operating company’s ICFR in the period between the consummation date of the reverse acquisition and the date of management’s assessment of ICFR required by Item 308(a) of Regulation S-K (see Section 215.02 of the SEC Division of Corporation Finance’s Regulation S-K Compliance & Disclosure Interpretations).

We completed the Business Combination on July 1, 2021, pursuant to which we acquired Legacy AvePoint and its subsidiaries.

Prior to the Business Combination, we were a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination involving one or more businesses.

Previously existing internal controls are no longer applicable or comprehensive enough as of the assessment date as our operations prior to the Business Combination were insignificant compared to those of the consolidated entity post-Business Combination.

In addition, the design of internal controls over financial reporting for the Company following the Business Combination has required and will continue to require significant time and resources from our management and other personnel.

As a result, our management was unable, without incurring unreasonable effort or expense, to conduct an assessment of our internal control over financial reporting as of December 31, 2021.

With respect to the exclusion of the attestation report of our independent registered accounting firm in this Annual Report, our independent registered public accounting firm will not be required to report on the effectiveness of our ICFR pursuant to Section 404 until we are no longer an “emerging growth company” as defined in the JOBS Act.

Changes in Internal Control Over Financial Reporting

Other than the Remediation Plan discussed above, there have been no changes in internal control over financial reporting during the quarter ended December 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Other than the Remediation Plan discussed above and the ongoing implementation of measures under the Remediation Plan designed to accurately maintain our financial records, enhance the flow of financial information, improve data management, and provide timely information to our management team, there have been no changes in internal control over financial reporting during the year ended December 31, 2022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

However, as we continue to implement the Remediation Plan, we will change our process and procedures, which in turn could result in changes to our internal control over financial reporting. As such changes occur, we will evaluate quarterly whether such changes materially affect our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

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Because of the inherent limitations in any control system, misstatements due to error or fraud may occur and not be detected.

PART II, PART III

Items 9B, 9C, 10, 11, 12, 13, 14

OTHER INFORMATION

Share Repurchase Program 

On March 17, 2022, we announced that our Board of Directors authorized a new share repurchase program (the " Share Repurchase Program ") for us to buy back shares of our Common Stock.

Under the Share Repurchase Program, we have the authority to buy up to a maximum of $150 million of Common Stock shares via acquisitions in the open market or privately negotiated transactions.

The Share Repurchase Program will remain open for a period of three years from the date of authorization.

Purchases made pursuant to the Share Repurchase Program will be conducted in compliance with Exchange Act Rule 10b-18 (or pursuant to a plan implemented in response to Exchange Act Rule 10b5-1(c) for parties that frequently have access to material nonpublic information, such as our executive officers and directors) and all other applicable legal, regulatory, and internal policy requirements, including our Insider Trading Policy. The Company is not obligated to make purchases of, nor is it obligated to acquire any particular amount of, Common Stock under the Share Purchase Program.

The Share Repurchase Program may be suspended or discontinued at any time.

As of the date of this Annual Report, the Company has 

made the following purchases under the Share Repurchase Program.

Total number of shares purchased (1)

Average price paid per share

Total number of shares purchased as part of the Share Repurchase Program

Maximum number (or approximate dollar value) of shares that may yet be purchased under the Share Repurchase Program (2)

March 17, 2022 - March 31, 2022

$149,256,352.50 (4)

(1) All shares reported herein were purchased pursuant to the publicly announced Share Repurchase Program.

(2) The Share Repurchase Program authorizes

us to purchase up to an aggregate of $150 million of our Common Stock until March 17, 2025 (three years from the date of authorization).

(3) One purchase was made during this period on March 25, 2022.

(4) The maximum remaining dollar value of shares that may yet be purchased under the Share Repurchase Program is reduced by the aggregate price paid for share purchases in addition to any fees, commissions, or other costs that may arise as a result of the purchase.

On March 29, 2023, our Board of Directors, as part of a periodic review of AvePoint’s governance documents, approved changes to AvePoint’s Bylaws, effective as of March 29, 2023 (as amended and restated, the “

Bylaws ”).

The amendments, among other things:

provide that special meetings of the stockholders may only be called by the president, the president or secretary of the corporation at the written request of a majority of the Board of Directors or by the secretary of the corporation at the written request of stockholders owning at least 50% of AvePoint’s stock that is issued and outstanding and entitled to vote at the meeting;

require that the special meeting request be delivered to the secretary of the corporation at AvePoint’s principal executive offices and be signed by the stockholder or an authorized agent of the stockholder who is requesting the special meeting.

The stockholder’s request must also set forth:

a brief description of each matter of business desired to be brought before the special meeting, the reasons for conducting the business at the meeting, the text of any proposal or business to be considered at the meeting and the information required by the advance notice provision of the bylaws, as applicable;

specify that the majority of the members of a committee shall constitute a quorum at any meeting of that committee and the vote of a majority of the members of the committee present at the meeting will be the act of the committee;

require a stockholder seeking to bring a director nomination or other business before a meeting of stockholders (“proposing stockholder”) to provide certain disclosures, including:

any derivative instrument that has been entered into by, or on behalf of, the proposing stockholder and any affiliates or associates or other parties with whom the proposing stockholder is acting in concert (each, an “associated person”), the effect or intent of which is to mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, the proposing stockholder or any associated person, with respect to AvePoint shares, or relates to the acquisition or disposition of any AvePoint shares;

a brief description of the business desired to be brought before the meeting, including the complete text of any resolutions to be presented at the meeting;

the name and address, as they appear on the Corporation’s stock ledger, of the proposing stockholder and any associated person;

a representation that the proposing stockholder is a stockholder of record and intends to appear at the meeting of stockholders to bring the business before the meeting specified in the notice;

the class and number of shares of AvePoint’s stock owned by the proposing stockholder, any beneficial owner on whose behalf the nomination is being made and any associated person;

any agreement pursuant to which the proposing stockholder or any associated person, has a right to vote or direct the voting of any of the AvePoint’s securities;

any rights to dividends on AvePoint shares owned beneficially by the proposing stockholder and any associated person that are separated or separable from the underlying AvePoint shares;

any proportionate interest in AvePoint shares or any derivative instruments held, directly or indirectly, by a general or limited partnership or limited liability company or similar entity in which the proposing stockholder or any associated person is a general partner or, directly or indirectly, beneficially owns an interest in a general partner, is the manager or managing member or, directly or indirectly, beneficially owns an interest in the manager or managing member of a limited liability company or similar entity;

any performance-related fees (other than an asset-based fee) that the proposing stockholder or any associated person is entitled to based on the increase or decrease in the value of AvePoint shares or derivative instruments;

expand the scope of disclosures required by a proposing stockholder seeking to bring a director nomination (“stockholder nominee”) to include:

the name and address, as they appear on the Corporation’s stock ledger, of the proposing stockholder, any beneficial owner on whose behalf the nomination is being made and any associated person;

a representation that the proposing stockholder is a stockholder of record and intends to appear at the meeting of stockholders to nominate the person(s) specified in the notice;

the class and number of shares of AvePoint’s stock owned by the proposing stockholder, any beneficial owner on whose behalf the nomination is being made and any associated person;

a description of any derivative instrument that has been entered into by, or on behalf of, the proposing stockholder and any associated person, the effect or intent of which is to mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, the proposing stockholder or any associated person, with respect to AvePoint shares, or relates to the acquisition or disposition of any AvePoint shares;

any agreement pursuant to which the proposing stockholder or any associated person, has a right to vote or direct the voting of any of the AvePoint’s securities;

any rights to dividends on AvePoint shares owned beneficially by the proposing stockholder and any associated person that are separated or separable from the underlying AvePoint shares;

a description of all agreements between the proposing stockholder, beneficial owner on whose behalf the nomination is being made or any associated person and each stockholder nominee with respect to the stockholder nominee’s service or duties as a nominee or director of AvePoint, including as direct or indirect confidentiality, compensation, reimbursement or indemnification arrangements;

any information that would be required to be set forth in a Schedule 13D pursuant to Rule 13d-1(a) of the Exchange Act or Rule 13d-2(a) of the Exchange Act;

the name, age, business address and, if known, residence address of each stockholder nominee for whom the proposing stockholder is proposing or intends to solicit proxies and of each stockholder nominee who would be presented for election at the annual meeting in the event of a need to change the proposing stockholders’ original slate;

a representation as to whether the proposing stockholder or any associated person intends to solicit proxies in support of director nominees other than individuals nominated by the Board of Directors (“board nominees”) in compliance with the requirements of Rule 14a-19(b) under the Securities Exchange Act of 1934 (the “Exchange Act”);

set the deadline for which a proposing stockholder must provide notice to AvePoint of the proposing stockholder’s intent to nominate directors for election to the Board or propose other business at an annual meeting to not later than 90 calendar days or earlier than 120 days calendar days prior to the anniversary of the immediately preceding annual meeting and provide that, if no annual meeting was held in the previous year or the date of the annual meeting is more than 30 calendar days before or more than 60 calendar days after such anniversary date, the proposing stockholder must provide notice to AvePoint not later than the 90th calendar day prior to such annual meeting of stockholders or, if later, the 10th calendar day following the date on which public disclosure of the date of such annual meeting is first made;

clarify that, in addition to complying with the advance notice provisions in the Bylaws, each proposing stockholder and any associated person must also comply with all applicable requirements of AvePoint’s Articles of Incorporation, the Bylaws and state and federal law, including the Exchange Act, with respect to any such proposal or the solicitation of proxies with respect thereto;

provide that any stockholder directly or indirectly soliciting proxies from other stockholders must use a proxy card color other than white;

provide that (a) no stockholder or associated person may solicit proxies in support of any nominees other than board nominees unless such stockholder and associated person complies with Rule 14a-19 under the Exchange Act in connection with the solicitation of such proxies, including the provision to AvePoint of notices required thereunder in a timely manner, and (b) if such stockholder or associated person (i) provides notice pursuant to Rule 14a-19(b) under the Exchange Act and (ii) subsequently fails to comply with any of the requirements of Rule 14a-19 under the Exchange Act, then AvePoint will disregard any proxies or votes solicited for such stockholder’s nominees;

provide that, if any stockholder or associated person provides notice pursuant to Rule 14a-19(b) under the Exchange Act, such stockholder or associated person must deliver to AvePoint, upon its request, reasonable evidence that such stockholder or associated person has met the requirements of Rule 14a-19 under the Exchange Act no later than five business days prior to the applicable meeting;

require stockholder nominees and board nominees to provide any additional information necessary to permit the Board to determine the nominee’s independence;

provide the number of directors shall be determined from time to time by resolutions of the Board;

clarify that directors shall be elected by a plurality of the votes cast and all other matters shall be decided by a majority of votes cast;

clarify that directors may be removed in accordance with AvePoint’s Certificate of Incorporation;

expand the indemnification requirements to indemnify officers and employees, in addition to directors, to the fullest extend of the laws of the state of Delaware;

make various other updates, including clarify, ministerial and conforming changes.

The foregoing description of the amendments to the Bylaws is qualified in its entirety by reference to the full text of the Bylaws, a copy of which is attached hereto as Exhibit 3.2 and is incorporated herein by reference.

PART II, PART III

Items 9C, 10, 11, 12, 13, 14

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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A list of our Executive Officers and biographical information appears in Part I, Item 1 of this Annual Report.

Information about our directors may be found in our Proxy Statement for the 2022 Annual Meeting of Shareholders (the “

Information about our directors may be found in our Proxy Statement for the 2023 Annual Meeting of Stockholders (the “

Proxy Statement ”) which was filed with the SEC on March 24, 2023.

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions “Information Regarding the Board of Directors and Corporate Governance,”

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions “Corporate Governance,”

“Election of Directors,”

and “Executive Officers.”

and “Named Executive Officers.”

We have adopted the AvePoint, Inc.

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The Code is publicly available on our Investor Relations website at https://ir.avepoint.com/.

Information contained on or accessible through this website is not a part of this Annual Report, and the inclusion of such website address in this Annual Report is an inactive textual reference only. 

If we make any substantive amendments to the Code or grant any waiver, including any implicit waiver, from a provision of the code to our Executive Officers or directors, we will disclose the nature of the amendment or waiver on our Investor Relations website or in a report on Form 8-K to the extent required by applicable rules and exchange requirements.

Information contained on or accessible through this website is not a part of this Annual Report, and the inclusion of such website address in this Annual Report is an inactive textual reference only. If we make any substantive amendments to the Code or grant any waiver, including any implicit waiver, from a provision of the code to our Executive Officers or directors, we will disclose the nature of the amendment or waiver on our Investor Relations website or in a report on Form 8-K to the extent required by applicable rules and exchange requirements.

EXECUTIVE COMPENSATION

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions, “Executive Compensation”

and “Director Compensation.”

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions, “Elements of Executive Compensation”

and “Non-Employee Director Compensation.”

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions “Security Ownership of Certain Beneficial Owners and Management”

and “Securities Authorized for Issuance under Equity Compensation Plans.”

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions “Security Ownership.”

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR  

The information required by this item is hereby incorporated by reference to the sections of the Proxy Statement under the captions “Transactions with Related Persons”

and “Independence of the Board of Directors.”

and “Board Leadership Structure.”

PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by this item is hereby incorporated by reference to the section of the Proxy Statement under the caption “Ratification of Selection of Independent Auditors.”

The information required by this item is hereby incorporated by reference to the section of the Proxy Statement under the caption “Ratification of Appointment of Independent Registered Public Accounting Firm for the 2023 Fiscal Year.”

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

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Filed Herewith

Business Combination Agreement and Plan of Reorganization, dated November  23, 2020, by and among Apex, Merger Subs and AvePoint.

Business Combination Agreement and Plan of Reorganization, dated November 23, 2020, by and among Apex, Merger Subs and AvePoint.

Form 8-K

March 9, 2021

Amendment No. 1 to Business Combination Agreement and Plan of Reorganization, dated December  30, 2020, by and among Apex, Merger Subs and AvePoint.

Amendment No. 1 to Business Combination Agreement and Plan of Reorganization, dated December 30, 2020, by and among Apex, Merger Subs and AvePoint.

Form 8-K

December 30, 2020

Amendment No. 2 to  Business Combination Agreement and Plan of Reorganization, dated March 8, 2021, by and among Apex, Merger Subs and AvePoint.

Amendment No. 2 to Business Combination Agreement and Plan of Reorganization, dated March 8, 2021, by and among Apex, Merger Subs and AvePoint.

Form 8-K

March 9, 2021

Amendment No. 3 to Business Combination Agreement and Plan of Reorganization, dated May  18, 2021, by and among Apex, Merger Subs and AvePoint.

Amendment No. 3 to Business Combination Agreement and Plan of Reorganization, dated May 18, 2021, by and among Apex, Merger Subs and AvePoint.

Form 10-Q

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Amended and Restated Bylaws of AvePoint, Inc.

Form 8-K

Specimen Common Stock Certificate.

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August 30, 2019

Description of Capital Stock

Warrant Agreement, dated September 16, 2019, by and between Continental Stock Transfer & Trust Company and Apex.

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November 23, 2020

Amended and  Restated Registration Rights Agreement, dated July 1, 2021, by and among AvePoint and certain stockholders of AvePoint.

Amended and Restated Registration Rights Agreement, dated July 1, 2021, by and among AvePoint and certain stockholders of AvePoint.

Form 8-K

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and HSBC Ventures USA Inc.

Assignment and Assumption Agreement, dated as of July  23, 2021, by and among AvePoint, Inc., AvePoint US, LLC, and HSBC Ventures USA Inc.

Assignment and Assumption Agreement, dated as of July 23, 2021, by and among AvePoint, Inc., AvePoint US, LLC, and HSBC Ventures USA Inc.

July 30, 2021

Limited Consent and Waiver to Loan and Security Agreement, dated as of July  23, 2021, by and among AvePoint, Inc., AvePoint US, LLC, AvePoint Public Sector, Inc., AvePoint Holdings USA, LLC, and HSBC Ventures USA Inc.

Limited Consent and Waiver to Loan and Security Agreement, dated as of July 23, 2021, by and among AvePoint, Inc., AvePoint US, LLC, AvePoint Public Sector, Inc., AvePoint Holdings USA, LLC, and HSBC Ventures USA Inc.

July 30, 2021

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August 16, 2021

2022 Performance-Based Annual Incentive Plan

List of Subsidiaries.

August 5, 2021

Consent of Deloitte and Touche LLP, independent registered public accounting firm.

Consent of Crowe LLP, independent registered public accounting firm.

Power of Attorney (included in the signature page hereto).

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Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit).

Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101).

Furnished herewith.

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Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned;

thereunto duly authorized, in Jersey City, New Jersey on this 31st day of March, 2022.

thereunto duly authorized.

AVEPOINT, INC.

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KNOW ALL PERSONS BY THESE PRESENTS , that each person whose signature appears below constitutes and appoints Tianyi Jiang and Brian Michael Brown, and each of them, as his or her true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for such individual in any and all capacities, to do any and all acts and things and to execute in his or her name (whether on behalf of AvePoint, Inc.

(the " Company ") or as an officer or director of the Company, or otherwise) any and all instruments and to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Registrant and in the capacities indicated on this 31 st  day of March, 2022.

(the “

Company ”) or as an officer or director of the Company, or otherwise) any and all instruments and to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Registrant and in the capacities and on the dates indicated.

/s/ Xunkai Gong

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Officer, Secretary, and Director

/s/ Stephen CuUnjieng

/s/ Janet Schijns

March 31, 2023

Stephen CuUnjieng

Janet Schijns

/s/ Jeff Teper

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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