What changed in this filing

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Item 1. Financial Statements

2022-08-15 compared with 2022-05-13 · 235 added, 188 removed, 679 unchanged (38% of the section changed)

27 unchanged sentences

510,000,000 shares authorized;

35,686,073 issued and 35,686,073 outstanding as of March 31, 2022, and 34,464,920 issued and 34,464,920 outstanding December 31, 2021, respectively

37,307,745 issued and 37,307,745 outstanding as of June 30, 2022, and 34,464,920 issued and 34,464,920 outstanding as of December 31, 2021, respectively

Class B common stock, $ 0.001 par value;

180,000,000 shares authorized;

81,630,126 shares issued and 81,506,674 shares outstanding as of March 31, 2022, 82,851,279 shares issued and 82,727,827 shares outstanding as of December 31, 2021, respectively

79,885,002 shares issued and 79,761,550 shares outstanding as of June 30, 2022, and 82,851,279 shares issued and 82,727,827 shares outstanding as of December 31, 2021, respectively

Treasury stock

3 unchanged sentences

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

The Notes to Consolidated Financial Statements are an integral part of these statements.

The Notes to Consolidated Financial Statements

are an integral part of these statements.

Consolidated Statements of Operations

(Unaudited, in thousands except per share amounts)

(in thousands, except per share amounts)

For the Three Months

Ended March 31,

Ended June 30,

For the Six Months

Ended June 30,

Management and advisory fees

22 unchanged sentences

Diluted earnings per share

Dividends paid per share

Weighted average shares outstanding, basic

Weighted average shares outstanding, diluted

The Notes to Consolidated Financial Statements are an integral part of these statements.

The Notes to Consolidated Financial Statements

are an integral part of these statements.

Consolidated Statements of Changes in Stockholders’

(Unaudited, in thousands)

(in thousands)

Common Stock - Class A

7 unchanged sentences

Balance at March 31, 2021

Stock-based compensation

Net income attributable to P10

Balance at June 30, 2021

Common Stock - Class A

10 unchanged sentences

Balance at March 31, 2022

The Notes to Consolidated Financial Statements are an integral part of these statements.

Stock-based compensation

Net income attributable to P10

Exchange of Class B common stock for Class A common stock

Dividends declared

Dividends paid

Balance at June 30, 2022

The Notes to Consolidated Financial Statements

are an integral part of these statements.

Consolidated Statements of Cash Flows

(Unaudited, in thousands)

For the Three Months

Ended March 31,

(in thousands)

For the Six Months

Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES

30 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings on debt obligations

Repayments on debt obligations

Payment of preferred stock dividends

Payments of contingent consideration

Cash settlement of stock options

Dividends paid

Debt issuance costs

3 unchanged sentences

CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of

The Notes to Consolidated Financial Statements are an integral part of these statements.

The Notes to Consolidated Financial Statements

are an integral part of these statements.

Consolidated Statements of Cash Flows

(Unaudited, in thousands)

For the Three Months

Ended March 31,

(in thousands)

For the Six Months

Ended June 30,

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Cash paid for interest

Net cash (received)/paid for income taxes

Net cash paid for income taxes

NON-CASH OPERATING, INVESTING AND FINANCING ACTIVITIES

1 unchanged sentence

Additions to lease liabilities

Accrual for settlement of stock options

Additions to contingent consideration

Additions to capex for leasehold improvements

Dividends declared

RECONCILIATION OF CASH, CASH EQUIVALENTS AND

3 unchanged sentences

Total cash, cash equivalents and restricted cash

The Notes to Consolidated Financial Statements are an integral part of these statements.

The Notes to Consolidated Financial Statements

are an integral part of these statements.

Notes to Consolidated Financial Statements

5 unchanged sentences

In connection with the reorganization, P10, Inc.

("P10") became the parent company and all of the existing equity of P10 Holdings, which is a wholly owned subsidiary of P10 including the convertible preferred units of P10 Intermediate, as defined below, were converted into common stock of P10.

("P10") became the parent company and all of the existing equity of P10 Holdings and its consolidated subsidiaries, including the convertible preferred units of P10 Intermediate, as defined below, were converted into common stock of P10.

The offering and reorganization included a reverse stock split of P10 Holdings common stock on a 0.7-for-1 basis pursuant to which every outstanding share of common stock decreased to 0.7 shares.

4 unchanged sentences

Each share of Class B common stock is entitled to ten votes while each share of Class A common stock is entitled to one vote.

P10 and its consolidated subsidiaries (the “Company”) operate as a multi-asset class private market solutions provider in the alternative asset management industry.

and its consolidated subsidiaries (the “Company”) operate as a multi-asset class private market solutions provider in the alternative asset management industry.

Our mission is to provide our investors differentiated access to a broad set of solutions and investment vehicles across a multitude of asset classes and geographies.

1 unchanged sentence

The direct and indirect subsidiaries of the Company include P10 Holdings, P10 Intermediate Holdings, LLC (“P10 Intermediate”), which owns the subsidiaries P10 RCP Holdco, LLC (“Holdco”), Five Points Capital, Inc.

(“Five Points”), TrueBridge Capital Partners, LLC (“TrueBridge”), Enhanced Capital Group, LLC (“ECG”), Bonaccord Capital Advisors, LLC ("Bonaccord") and Hark Capital Advisors, LLC ("Hark").

(“Five Points”), TrueBridge Capital Partners, LLC (“TrueBridge”), Enhanced Capital Group, LLC (“ECG”), Bonaccord Capital Advisors, LLC ("Bonaccord"), Hark Capital Advisors, LLC ("Hark") and P10 Advisors, LLC ("P10 Advisors").

Prior to November 19, 2016, P10, formerly Active Power, Inc.

22 unchanged sentences

On December 14, 2020, the Company completed the acquisition of 100% of the equity interest in ECG, and a noncontrolling interest in Enhanced Capital Partners, LLC (“ECP”) (collectively, “Enhanced”).

Enhanced undertakes and

Enhanced undertakes and manages equity and debt investments in impact initiatives across North America, targeting underserved areas and other socially responsible end markets including renewable energy, historic building renovations, and affordable housing.

ECP is a registered investment advisor with the United States Securities and Exchange Commission.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

manages equity and debt investments in impact initiatives across North America, targeting underserved areas and other socially responsible end markets including renewable energy, historic building renovations, and affordable housing.

ECP is a registered investment advisor with the United States Securities and Exchange Commission.

On September 30, 2021, the Company completed acquisitions of Bonaccord and Hark.

2 unchanged sentences

See Note 3 for additional information on these acquisitions.

In June 2022, we formed P10 Advisors, a fully consolidated subsidiary, to manage investment opportunities that are sourced across the P10 platform but do not fit within an existing investment mandate.

Significant Accounting Policies

5 unchanged sentences

All intercompany transactions and balances have been eliminated upon consolidation.

The results for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year ended December 31, 2022.

The results for the six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year ending December 31, 2022.

Certain entities in which the Company holds an interest are investment companies that follow specialized accounting rules under U.S.

9 unchanged sentences

To determine a VIE's primary beneficiary, we perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits.

This assessment involves identifying the activities that most significantly impact the VIE's economic performance and determining whether we, or another party, has the power to direct those activities.

This assessment involves identifying the activities that most significantly impact the VIE's economic performance and determine whether we, or another party, has the power to direct those activities.

When evaluating whether we are the primary beneficiary of a VIE, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties.

3 unchanged sentences

The assets and liabilities of the consolidated VIEs are presented on a gross basis in the Consolidated Balance Sheets.

As a result of the reorganization, it was determined that

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

P10 Intermediate no longer qualifies as a VIE, but would still be consolidated under the voting interest model.

As a result of the reorganization, it was determined that P10 Intermediate no longer qualifies as a VIE, but would still be consolidated under the voting interest model.

This change has been retrospectively adjusted.

See Note 7 for more information on both consolidated and unconsolidated VIEs.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Entities that do not qualify as VIEs are assessed for consolidation under the voting interest model.

Under the voting interest model, the Company consolidates those entities it controls through a majority voting interest or other means.

P10 Holdings, P10 Intermediate, Five Points and ECG are concluded to be consolidated subsidiaries of P10 under the voting interest model.

P10 Holdings, P10 Intermediate, Five Points, P10 Advisors and ECG are concluded to be consolidated subsidiaries of P10 under the voting interest model.

Reclassifications

Certain reclassifications have been made within the Consolidated Financial Statements to conform prior periods with the current period presentation.

Certain reclassifications have been made within the Consolidated Financial Statements to conform prior periods with current period presentation.

Use of Estimates

4 unchanged sentences

The Company considers all highly liquid instruments with original maturities of three months or less to be cash equivalents.

As of March 31, 2022, and December 31, 2021, cash equivalents include money market funds of $ 7.4 million and $ 10.7 million, respectively, which approximates fair value.

As of June 30, 2022, and December 31, 2021, cash equivalents include money market funds of $ 7.5 million and $ 10.7 million, respectively, which approximates fair value.

The Company maintains its cash balances at various financial institutions, which may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limits.

1 unchanged sentence

Restricted Cash

Restricted cash as of March 31, 2022 and December 31, 2021 was primarily cash that is restricted due to certain deposits being held for customers.

Restricted cash as of June 30, 2022 and December 31, 2021 was primarily cash that is restricted due to certain deposits being held by the Company for its customers.

Accounts Receivable and Due from Related Parties

1 unchanged sentence

The Company considers accounts receivable to be fully collectible;

accordingly, no allowance for doubtful accounts has been established as of March 31, 2022 and December 31, 2021.

accordingly, no allowance for doubtful accounts has been established as of June 30, 2022 and December 31, 2021.

If accounts are subsequently determined to be uncollectible, they will be expensed in the period that determination is made.

Due from related parties represents receivables from the Funds for management fees earned but not yet received and reimbursable expenses from the Funds.

Due from related parties represents receivables from the Funds for reimbursable expenses.

Additionally, fees owed to the Company for the advisory agreement entered into upon the closing of the acquisitions of ECG and ECP ("Advisory Agreement") where ECG provides advisory services to Enhanced PC are reflected in due from related parties on the Consolidated Balance Sheets.

These amounts are expected to be fully collectible.

Note Receivable

Note receivable is equal to contractual amounts owed from a signed, secured promissory note with the Company.

Note receivable is equal to contractual amounts owed from a signed, secured promissory note with Bonaccord.

In addition to contractual amounts, borrowers are obligated to pay interest on outstanding amounts.

The Company considers the note receivable to be fully collectible;

accordingly, no allowance for doubtful accounts has been established as of March 31, 2022 or as of December 31, 2021.

accordingly, no allowance for doubtful accounts has been established as of June 30, 2022 or December 31, 2021 .

If accounts are subsequently determined to be uncollectible, they will be expensed in the period that determination is made.

See Note 6 for further discussion surrounding the note receivable.

Notes to Consolidated Financial Statements

28 unchanged sentences

Absent an implicit interest rate in the lease, the Company uses its incremental borrowing rate, adjusted for the effects of collateralization, based on the information available at commencement in determining the present value of lease payments.

The Company’s lease terms may include options to extend or terminate the lease, and the Company would account for this when it is reasonably certain that the Company will exercise those options.

The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise those options.

Lease expense is recognized on a straight-line basis over the lease term.

2 unchanged sentences

Instead, the Company recognizes short-term lease payments as an expense on a straight-line basis over the lease term.

A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does

A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise.

When determining whether

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise.

When determining whether a lease qualifies as a short-term lease, the Company evaluates the lease term and the purchase option in the same manner as all other leases.

a lease qualifies as a short-term lease, the Company evaluates the lease term and the purchase option in the same manner as all other leases.

Goodwill and Intangible Assets

Goodwill is initially measured as the excess of the cost of the acquired business over the sum of the amounts assigned to identifiable assets acquired, less the liabilities assumed.

As of March 31, 2022, goodwill recorded on our Consolidated Balance Sheets relates to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord, and Hark.

As of March 31, 2022, the intangible assets are comprised of indefinite-lived intangible assets and finite-lived intangible assets related to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord and Hark.

As of June 30, 2022, goodwill recorded on our Consolidated Balance Sheets relates to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord, and Hark.

As of June 30, 2022, the intangible assets are comprised of indefinite-lived intangible assets and finite-lived intangible assets related to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord and Hark.

Indefinite-lived intangible assets and goodwill are not amortized.

6 unchanged sentences

The reporting unit is the reporting level for testing the impairment of goodwill.

If it is determined that it is more likely than not that a reporting unit’s fair value is less than its carrying value, then the Company will determine the fair value of the reporting unit and record an impairment charge for the difference between fair value and carrying value (not to exceed the carrying amount of goodwill).

If it is determined that it is more likely than not that a reporting unit’s fair value is less than its carrying value, then the difference is recorded as an impairment (not to exceed the carrying amount of goodwill).

Contingent Consideration

1 unchanged sentence

The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in operating expenses on our Consolidated Statements of Operations.

As of March 31, 2022, contingent consideration recorded relates to the acquisitions of Hark and Bonaccord on the Consolidated Balance Sheets.

The contingent consideration recorded as of March 31, 2021 on the Consolidated Balance Sheets relates to the TrueBridge acquisition.

As of June 30, 2022 and December 31, 2021, contingent consideration recorded relates to the acquisitions of Hark and Bonaccord on the Consolidated Balance Sheets.

Debt Issuance Costs

4 unchanged sentences

At the date of subsequent reissuance, the treasury stock account is reduced by the cost of such stock using the average cost method.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Fair Value Measurements

1 unchanged sentence

We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rank the estimated values based on the reliability of the inputs used following the fair value hierarchy set forth by the FASB.

As of March 31, 2022 and December 31, 2021, we used the following valuation techniques to measure fair value for assets and there were no changes to these methodologies during the periods presented:

As of June 30, 2022 and December 31, 2021, we used the following valuation techniques to measure fair value for assets and there were no changes to these methodologies during the periods presented:

Level 1—Assets were valued using the closing price reported in the active market in which the individual security was traded.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Level 2—Assets were valued using quoted prices in markets that are not active, broker dealer quotations, and other methods by which all significant inputs were observable at the measurement date.

1 unchanged sentence

The carrying values of financial instruments comprising cash and cash equivalents, prepaid assets, accounts payable, accounts receivable and due from related parties approximate fair values due to the short-term maturities of these instruments.

The fair value of the credit facilities approximate carrying value based on the interest rates which approximate current market rates.

The fair value of the credit and guarantee facility approximates the carrying value based on the interest rates which approximate current market rates.

The Company has a contingent consideration liability related to the acquisitions of Hark and Bonaccord that is measured at fair value and is remeasured on a recurring basis.

2 unchanged sentences

Revenue is recognized when, or as, the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services.

While the determination of who the customer is in a contractual arrangement will be made on a contract-by-contract basis, the customer will generally be the investment fund for the Company’s significant management and advisory contracts.

While the determination of who is the customer in a contractual arrangement will be made on a contract-by-contract basis, the customer will generally be the investment fund for the Company’s significant management and advisory contracts.

Management and Advisory Fees

13 unchanged sentences

If subscriptions or fees have been paid in advance, these fees are recorded as deferred revenue on our Consolidated Balance Sheets.

Referral fee revenue is recognized upon the closing of certain opportunities.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Referral fee revenue is recognized upon closing of certain opportunities.

Current income tax expense represents our estimated taxes to be paid or refunded for the current period.

In accordance with ASC 740, Income Taxes , we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards.

In accordance with ASC 740, Income Taxes (“ASC 740”), we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards.

Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse.

2 unchanged sentences

We recognize interest and penalties, if any, related to uncertain tax positions in income tax expense.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

We file various federal and state and local tax returns based on federal and state local consolidation and stand-alone tax rules as applicable.

Earnings Per Share

Basic earnings per share (“EPS”) is calculated by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding during the period.

Basic earnings per share (“EPS”) is calculated by dividing net income attributable to common stockholders by the weighted-average number of common shares.

Diluted EPS includes the determinants of basic EPS and common stock equivalents outstanding during the period adjusted to give effect to potentially dilutive securities.

4 unchanged sentences

The denominator in the computation of diluted EPS is impacted by additional common shares that would have been outstanding if dilutive potential shares of common stock had been issued.

Potential shares of common stock that may be issued by the Company include shares of common stock that may be issued upon exercise of outstanding stock options and restricted stock units that have been issued, but not vested.

Potential shares of common stock that may be issued by the Company include shares of common stock that may be issued upon exercise of outstanding stock options.

Under the treasury stock method, the unexercised options are assumed to be exercised at the beginning of the period or at issuance, if later.

13 unchanged sentences

According to ASC 280, Disclosures about Segments of an Enterprise and Related Information , operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker(s) in deciding how to allocate resources and in assessing performance.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Business Acquisitions

9 unchanged sentences

In accordance with ASC 805, the Company allocates the purchase price of an acquired business to its identifiable assets and liabilities based on the estimated fair values using the acquisition method.

The excess of the purchase price over the amount allocated to the assets and liabilities, if any, is recorded as goodwill.

The excess of the purchase price over the amount

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

allocated to the assets and liabilities, if any, is recorded as goodwill.

The excess value of the net identifiable assets and liabilities acquired over the purchase price of an acquired business is recorded as a bargain purchase gain.

4 unchanged sentences

The contingent consideration included in the purchase price is measured at fair value on the date of the acquisition.

The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in operating expenses on our Consolidated Statements of Operations.

The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in general, administrative and other on our Consolidated Statements of Operations.

For business acquisitions, the Company recognizes the fair value of goodwill and other acquired intangible assets, and estimated contingent consideration at the acquisition date as part of purchase price.

This fair value measurement is based on unobservable (Level 3) inputs.

Dividends are reflected in the consolidated financial statements when declared.

Recent Accounting Pronouncements

9 unchanged sentences

The guidance must be applied using the modified retrospective adoption method on January 1, 2023, with early adoption permitted.

We are evaluating the effects of these amendments on our financial reporting.

On October 28, 2021, the FASB issued ASU 2021-08, which amends ASC 805 to “require acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination.”

1 unchanged sentence

The guidance is effective for fiscal years beginning after December 15, 2022.

We are evaluating the effects of these amendments on our financial reporting.

On June 30, 2022, the FASB issued ASU No.

2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ("ASU 2022-03").

The amendments in this Update affect all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction.

The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

The amen d ments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction.

The guidance is effective for fiscal years beginning after December 15, 2023.

We are evaluating the effects of these amendments on our financial reporting.

Notes to Consolidated Financial Statements

15 unchanged sentences

therefore, the ultimate amount of the liability may differ materially from the current estimate.

As of March 31, 2022 , the estimated fair value of the remaining contingent consideration totaled $ 19.2 million, with the increase since acquisition driven primarily by changes in the Company's borrowing rate due to the debt refinancing.

As of June 30, 2022 , the estimated fair value of the remaining contingent consideration totaled $ 19.1 million, with the increase since acquisition driven primarily by changes in the Company's borrowing rate due to the debt refinancing.

See Note 11 for more details.

1 unchanged sentence

The Bonaccord Units may not be transferred, sold, pledged, exchanged, assigned or otherwise encumbered or disposed of by any grantee until it has become vested.

As of March 31, 2022, no Bonaccord Units have been allocated to specific employees or vested and no expense has been recorded in the Consolidated Statements of Operations.

The Bonaccord Units will be allocated to specific employees as the performance metrics are met.

As of June 30, 2022, certain performance metrics have been met however, no units have been allocated to specific employees.

Therefore, no expense has been recorded in the Consolidated Statements of Operations.

In connection with the acquisition, the Company incurred a total of $ 0.7 million of acquisition-related expenses.

Total acquisition-related expenses were $ 0 and $ 0 for the three months ended March 31, 2022 and March 31, 2021, respectively.

These costs are included in professional fees on the Consolidated Statement of Operations.

Of the total acquisition-related expenses, $ 0.2 million and $ 0.2 million were recorded during the three and six months ended June 30, 2022 and $ 0 and $ 0 for the three and six months ended June 30, 2021, respectively.

These costs are included in professional fees on the Consolidated Statements of Operations.

The acquisition date fair value of certain assets and liabilities, including intangible assets acquired and related weighted average expected lives are provisional and subject to revision within one year of the acquisition date.

As such, our estimates of fair values are pending finalization, which may result in adjustments to goodwill.

The following table presents the provisional fair value of the net assets acquired as of the acquisition date:

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

The following table presents the provisional fair value of the net assets acquired as of the acquisition date:

Prepaid expenses and other assets

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Total identifiable intangible assets

In connection with the acquisition, Bonaccord assumed a Strategic Alliance Agreement ("SAA"), providing a third-party the right to receive 15 % of the net management fee earnings, which includes the management fees minus applicable expenses, for Bonaccord Fund I ("Fund I"), paid quarterly, in exchange for funding certain amounts of capital commitments to the fund.

In connection with the acquisition, Bonaccord assumed a Strategic Alliance Agreement ("SAA"), providing a third-party the right to receive 15 % of the net management fee earnings, which includes the management fees minus applicable expenses, for Bonaccord Fund I ("Fund I") and any subsequent fund, paid quarterly, in exchange for funding certain amounts of capital commitments to the fund.

See Note 5 for more information.

9 unchanged sentences

The Hark Units may not be transferred, sold, pledged, exchanged, assigned or otherwise encumbered or disposed of by any grantee until they have become vested.

As of March 31, 2022, no Hark Units have vested and no expense has been recorded in the Consolidated Statements of Operations as we have not determined that the achievement of the performance metric is probable.

As of June 30, 2022, no Hark Units have vested and no expense has been recorded in the Consolidated Statements of Operations as we have not determined that the achievement of the performance metric is probable.

Notes to Consolidated Financial Statements

11 unchanged sentences

Pro-forma Financial Information

Prior Year Acquisition:

The following unaudited pro forma condensed consolidated results of operations of the Company assumes the acquisition of Bonaccord was completed on January 1, 2021:

For the Three Months

Ended March 31,

For the Six Months

Ended June 30,

Net income attributable to P10

Pro-forma adjustments include revenue and net income (loss) of the acquired business for each period.

Other pro forma adjustments include intangible amortization expense and interest expense based on debt issued in connection with the acquisition as if the acquisition were completed on January 1, 2021.

Pro forma adjustments include revenue and net income of the acquired business for each period.

Other pro forma adjustments include intangible amortization expense and interest expense based on debt issued or repaid in connection with the acquisition as if the acquisition was completed on January 1, 2021.

The following presents revenues disaggregated by product offering:

For the Three Months

Ended March 31,

Ended June 30,

For the Six Months

Ended June 30,

Management and advisory fees

4 unchanged sentences

In connection with the Bonaccord acquisition, Bonaccord assumed a SAA.

This SAA provides the third-party the right to receive 15 % of the net management fee earnings, which includes the management fees minus applicable expenses, for Fund I, paid quarterly, in exchange for funding certain amounts of capital commitments to the fund.

This SAA provides the third-party the right to receive 15 % of the net management fee earnings, which includes the management fees minus applicable expenses, for Fund I and subsequent funds, paid quarterly, in exchange for funding certain amounts of capital commitments to the fund.

Net management fee earnings the third-party has the right to receive is based on the total capital committed.

Within 60 days following the final closing of the next fund, Bonaccord Fund II ("Fund II"), the third-party has the opportunity to acquire, at the price at the time of the original acquisition, equity interests in Bonaccord based on the amount of

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Within 60 days following the final closing of the next fund, Bonaccord Fund II ("Fund II"), the third-party has the opportunity to acquire equity interests in Bonaccord based on the amount of commitment made to subsequent Funds II and III that ranges from 0.1 %- 9.9 % of equity in Bonaccord.

If within 60 days of the final closing of Funds II and III, the third-party has not met specific equity commitments in the SAA, Bonaccord may elect to repurchase the equity interests at fair market value.

In addition to this SAA, Bonaccord entered into another agreement with a third-party, similar to a placement fee arrangement, whereby the third party will receive 5 % of net management fee revenues for Fund I.

This expense is reported on the Consolidated Statements of Operations as strategic alliance expense in operating expenses.

For the three months ended March 31, 2022, the strategic alliance expense reported was $ 0.2 million.

In the three months ended March 31, 2021, there was no strategic alliance expense.

commitment made.

For each $ 5.0 million, up to a maximum of $ 250.0 million in irrevocable capital commitments to Fund II, the third-party can acquire 10 basis points up to a maximum of 5 % equity.

The maximum commitment requirement has been met as of June 30, 2022 with the first close of Fund II.

If executed, the purchase price shall be reduced by the amount of management fee distributions which the third-party would have been paid as of the initial closing of Fund II.

Similar terms apply for Fund III with the exception that the third-party can acquire 9.8 basis points for every $ 5.0 million committed up to 4.9 %.

This commitment has not yet been met as of June 30, 2022 as Fund III has not yet had its final close.

If commitment conditions to Funds subsequent to Funds II and III are not satisfied, then within 60 days of the final closing of such subsequent fund giving rise to the condition not being satisfied, the Company may elect to repurchase the equity granted to the third-party.

The repurchase shall be at the fair market value of such equity at that point in time.

For the three and six months ended June 30, 2022, the strategic alliance expense reported was $ 0.2 million and $ 0.3 million, respectively.

In the three and six months ended June 30, 2021, there was no strategic alliance expense.

This is reported on the Consolidated Statements of Operations as strategic alliance expense in operating expenses.

Note Receivable

The Company's note receivable consists of an Advance Agreement and Secured Promissory Note that was executed on September 30, 2021 between the Company and BCP Partners Holdings, LP ("BCP") to lend funds to certain employees to be used to pay general partner commitments to certain funds managed by Bonaccord.

This agreement provides for a note to BCP for $ 5.0 million, of which $ 2.8 million was drawn as of March 31, 2022 with a maturity date of September 30, 2031 .

This agreement provides for a note to BCP for $ 5.0 million, of which $ 2.8 million was drawn as of June 30, 2022 with a maturity date of September 30, 2031 .

The note will earn interest at the greater of (i) the applicable federal rate that must be charged to avoid imputation of interest under Section 1274(d) of the U.S.

1 unchanged sentence

Interest will be paid on December 31st of each year commencing December 31, 2021, with any unpaid accrued interest being capitalized and added to the outstanding principal balance.

There was no cash paid for interest as of December 31, 2021.

There was no cash paid for interest as of December 31, 2021 and the outstanding balance was capitalized to the note receivable.

Principal payments will be made periodically as mandatorily required payments from available cash flows at BCP.

As of March 31, 2022 and December 31, 2021, the outstanding balance was $ 2.8 million and $ 2.6 million, respectively.

The Company recognized interest income of $ 0.1 million and $ 0 for the three months ended March 31, 2022 and March 31, 2021, respectively.

As of June 30, 2022 and December 31, 2021, the outstanding balance was $ 2.8 million and $ 2.6 million, respectively.

The Company recognized interest income of $ 0.1 million and $ 0.1 million for the three and six months ended June 30, 2022.

The Company recognized no interest income for the three and six months ended June 30, 2021, as the note did not yet exist.

This is presented in other revenue on the Consolidated Statement of Operations.

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See Note 2 for more information on the Company’s accounting policies related to the consolidation of VIEs.

The assets of the consolidated VIEs totaled $ 398.6 million and $ 413.2 million as of March 31, 2022 and December 31, 2021 , respectively.

The liabilities of the consolidated VIEs totaled $ 47.2 million and $ 53.6 million a s of March 31, 2022 and December 31, 2021, respectively.

The assets of the consolidated VIEs totaled $ 400.6 million and $ 413.2 million as of June 30, 2022 and December 31, 2021 , respectively.

The liabilities of the consolidated VIEs totaled $ 48.5 million and $ 53.6 million as of June 30, 2022 and December 31, 2021, respectively.

The assets of our consolidated VIE’s are owned by those entities and not generally available to satisfy P10’s obligations, and the liabilities of our consolidated VIE’s are obligations of those entities, and their creditors do not generally have recourse to the assets of P10.

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The Company’s investment in unconsolidated subsidiaries consist of equity method investments primarily related to ECG’s tax credit finance and asset management activities.

As of March 31, 2022 , investment in unconsolidated subsidiaries totaled $ 2.0 million, of which $ 0.2 million related to ECG’s tax credit finance businesses and $ 1.8 million related to ECG’s asset management businesses.

As of June 30, 2022 , investment in unconsolidated subsidiaries totaled $ 2.3 million, of which $ 2.1 million related to ECG’s asset management businesses and $ 0.2 million related to ECG’s tax credit finance businesses.

As of December 31, 2021 , investment in unconsolidated subsidiaries totaled $ 1.8 million, of which $ 1.6 million related to ECG’s asset management businesses and $ 0.2 million related to ECG’s tax credit finance businesses.

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ECG manages some of its alternative asset management funds through various unconsolidated subsidiaries and records these investments under the equity method of accounting.

ECG recorded its share of income in the amount of $ 0.3 million for the three months ended March 31, 2022 and $ 0.2 million for the three months ended March 31, 2021.

For the three months ended March 31, 2022, ECG made $ 0 capital contributions and received distributions of $ 0.1 million.

ECG recorded its share of income in the amount of $ 0.8 million and $ 1.1 million for the three and six months ended June 30, 2022 and $ 0.3 million and $ 0.5 million for the three and six months ended June 30, 2021 , respectively.

For the three and six months ended June 30, 2022, ECG made $ 0 and $ 0 capital contributions and received distributions of $ 0.6 million and $ 0.7 million, respectively.

Tax Credit Finance

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Some of these subsidiaries own nominal interests, typically under 1.0%, in various VIEs and record these investments under the measurement alternative described in Note 2 above.

For the three months ended March 31, 2022, EC G made $ 0 of capital contributions and received distributions of $ 0 .

For the three and six months ended June 30, 2022, ECG made $ 0 and $ 0 of capital contributions and received distributions of $ 0 and $ 0 , respectively.

Property and Equipment

Property and equipment consist of the following:

As of March 31,

As of June 30,

As of December 31,

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Goodwill and Intangibles

Changes in goodwill for the three months ended March 31, 2022 are as follows:

Changes in goodwill for the six months ended June 30, 2022 is as follows:

Balance at December 31, 2021

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Increase from acquisitions

Balance at March 31, 2022

Balance at June 30, 2022

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Intangibles consists of the following:

As of March 31, 2022

As of June 30, 2022

Gross Carrying

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Total intangible assets

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

As of December 31, 2021

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Total intangible assets

Management and advisory contracts and finite lived trade names are amortized over 7 - 16 years and are being amortized in line with pattern in which the economic benefits are expected to arise.

Management and advisory contracts and finite lived trade names are amortized over 7 - 16 years and are being amortized in line with pattern in which the economic benefits that are expected to occur.

Technology is amortized on a straight-line basis over 4 years.

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Total amortization

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Fair Value Measurements

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The following tables provide details regarding the classification of these liabilities within the fair value hierarchy as of the dates presented:

As of March 31, 2022

As of June 30, 2022

Contingent consideration obligation

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Total liabilities

For the liabilities presented in the tables above, there were no changes in fair value hierarchy levels during the periods ended March 31, 2022 and December 31, 2021.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

For the liabilities presented in the tables above, there were no changes in fair value hierarchy levels during the periods ended June 30, 2022 and December 31, 2021.

The changes in the fair value of Level III financial instruments are set forth below:

Contingent Consideration Liability

For the Three Months Ended March 31,

For the Six Months Ended June 30,

For the Year Ended December 31,

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Changes in the fair value of the liability are included in contingent consideration expense on the Consolidated Statements of Operations.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Debt Obligations

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Total debt obligations

The table below summarizes the terms of the debt obligations.

June 30, 2022

Maturity Date

Aggregate Facility Size

Outstanding Debt

Amount Available

Net Carrying Value

Average Interest Rate

Revolver Facility

On December 22, 2021, the Company extinguished its debt outstanding with HPS, as described below in the Credit and Guaranty Facility section and simultaneously entered into a new credit agreement with JP Morgan Chase Bank, N.A.

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Revolving Credit Facility State Tax Credits

Enhanced State Tax Credit Fund III, LLC, a subsidiary of ECG, has a $ 10 million revolving credit facility with a regional financial institution the funds from which can be used solely for the purchase of allocable state tax credits from various state tax credit incentive programs.

The facility bears interest at 0.25 % above the Prime Rate and matures on June 15, 2022 .

As of March 31, 2022 and December 31, 2021 , the credit facility had an outstanding balance of $ 0.0 million and $ 0.0 million, respectively, and is reported net of unamortized debt issuance costs on our Consolidated Balance Sheets.

As of March 31, 2022 and December 31, 2021 , the Company’s investment in allocable state tax credits was $ 0 and $ 0 .

For the three months ended March 31, 2022 and 2021 $ 0 and $ 0 interest expense was incurred, respectively.

Enhanced State Tax Credit Fund III, LLC, a subsidiary of ECG, had a $ 10 million revolving credit facility with a regional financial institution restricted solely for the purchase of allocable state tax credits from various state tax credit incentive programs.

The facility bore interest at 0.25 % above the Prime Rate and matured on June 15, 2022 .

The facility was not renewed upon maturity.

There was no outstanding balance nor any interest incurred as of June 30, 2022 and December 31, 2021 respectively.

Notes Payable to Sellers

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On December 23, 2021, the Company used the proceeds from the new credit agreement with JP Morgan to repay the outstanding balance of the 2017 Sellers Notes.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

On January 3, 2018, the Company issued Secured Promissory Notes Payable (“2018 Seller Notes”) in the amount of $ 22.1 million to the owners of RCP 3 in connection with the acquisition of that entity.

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The TAB Payments were set to mature on April 15,

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

On December 23, 2021, the Company used the proceeds from the new credit agreement with JP Morgan to repay the outstanding balance of the TAB Payments.

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on our Consolidated Financial Statements.

Noncash interest expense was recorded on a periodic basis for the Notes Payable to Sellers.

During the three months ended March 31, 2022 and March 31, 2021, we recorded combined interest expense on the 2018 Seller Notes and 2017 Seller Notes in the amount of $ 0 , $ 0.2 million, respectively.

During the three months ended March 31, 2022, we recorded $ 0 in interest expense related to the TAB Payments.

For the three months ended March 31, 2021 , we recorded $ 0.2 million on the TAB Payments.

Non-cash interest expense was recorded on a periodic basis for the Notes Payable to Sellers.

During the three and six months ended June 30, 2022, we recorded $ 0 and $ 0 , respectively, and for the three and six months ended June 30, 2021 , we recorded $ 0.1 million and $ 0.4 million, respectively, in interest expense related to the TAB Payments.

Credit and Guaranty Facility

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The Adjusted Term SOFR Rate is the Secured Overnight Financing Rate ("SOFR") at the date of election, plus 2.10 %.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Company can elect one or three months for the Revolver Facility and three or six months for the Term Loan.

The Company elected a six month SOFR rate at the time of draw for the term loan and a one month SOFR rate for the Revolver Facility at the time of draw.

The Company can elect one or three months for the Revolver Facility and three or six months for the Term Loan.

Principal is contractually repaid at a rate of 1.25 % on the term loan quarterly effective March 31, 2023.

The Revolving Credit Facility has no contractual principal repayments until maturity, which is December 22, 2025 for both facilities.

Certain P10 subsidiaries are encumbered by this debt agreement.

The Credit Agreement contains affirmative and negative covenants typical of such financing transactions, and specific financial covenants which require P10 to maintain a minimum leverage ratio.

As of March 31, 2022, P10 was in compliance with its financial covenants required under the facility.

In February 2022, the Company repaid $ 25 million of the principal balance outstanding on the revolving credit facility.

As of March 31, 2022, the balance drawn on the revolving credit facility is $ 65.9 million and on the term loan, the balance is $ 125.0 million.

As of June 30, 2022, P10 was in compliance with its financial covenants required under the facility.

In February 2022, the Company repaid $ 25 million of the principal balance

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

outstanding on the revolving credit facility.

As of June 30, 2022, the balance drawn on the revolving credit facility is $ 65.9 million and on the term loan, the balance is $ 125.0 million.

The balance as of December 31, 2021 was $ 90.9 million on the revolving credit facility and $ 125 million on the term loan.

For the three months ended March 31, 2022 and March 31, 2021, $ 0.9 million and $ 0 of interest expense was incurred, respectively.

Future principal maturities of debt as of March 31, 2022 are as follows:

For the three and six months ended June 30, 2022 $ 1.3 million and $ 2.5 million of interest expense was incurred, respectively.

For the three and six months ended June 30, 2021, $ 0 and $ 0 of interest expense was incurred, respectively.

Future principal maturities of debt as of June 30, 2022 are as follows:

Debt Issuance Costs

Debt issuance costs are offset against the Revolving Credit Facility State Tax Credits, the Credit and Guaranty Facility, and the Revolver Facility and Term Loan.

Unamortized debt issuance costs for the Credit and Guaranty Facility as of March 31, 2022 and December 31, 2021 were $ 0 and $ 0 , respectively.

Unamortized debt issuance costs for the Revolving Credit Facility State Tax Credits as of March 31, 2022 and December 31, 2021 were $4 thousand and $ 8 thousand, respectively.

Unamortized debt issuance costs for the Revolver Facility and Term Loan as of March 31, 2022 and December 31, 2021 were $ 3.2 million and $ 3.4 million, respectively.

Amortization expense related to debt issuance costs totaled $ 0.2 million for the three months ended March 31, 2022 and $ 0.7 million for the three months ended March 31, 2021.

This is reported in interest expense, net on the Consolidated Statements of Operations.

During the three months ended March 31, 2022 and March 31, 2021 , we recorded $ 8 thousand and $ 0.1 million in debt issuance costs, respectively, which is included in debt obligations on the Consolidated Balance Sheets.

Unamortized debt issuance costs for the Credit and Guaranty Facility as of June 30, 2022 and December 31, 2021 were $ 0 and $ 0 , respectively.

Unamortized debt issuance costs for the Revolving Credit Facility State Tax Credits as of June 30, 2022 and December 31, 2021 were $ 0 and $ 8 thousand, respectively.

Unamortized debt issuance costs for the Revolver Facility and Term Loan as of June 30, 2022 and December 31, 2021 were $ 3.0 million and $ 3.4 million, respectively.

This is included in debt obligations on the consolidated balance sheets.

Amortization expense related to debt issuance costs totaled $ 0.2 million and $ 0.4 million for the three and six months ended June 30, 2022 and $ 0.7 million and $ 1.4 million for the three and six months ended June 30, 2021, respectively, and are included within interest expense, net on the accompanying Consolidated Statements of Operations.

During the six months ended June 30, 2022 and June 30, 2021 , we recorded $ 0.1 million and $ 0.1 million in debt issuance costs, respectively, which is included in debt obligations on the consolidated balance sheets.

Related Party Transactions

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The monthly rent expense is $ 20.3 thousand, and the lease expires December 31, 2029 .

P10 has paid $ 0.1 million and $ 0.1 million in rent to 210 Capital, LLC for the three months ended March 31, 2022 and March 31, 2021, respectively.

P10 has paid $ 0.1 million and $ 0.1 million in rent to 210 Capital, LLC for the six months ended June 30, 2022 and June 30, 2021, respectively.

Effective April 1, 2020, P10 Intermediate paid a quarterly management fee of $ 250 thousand to Keystone Capital XXX, LLC, which was the holder of the Series B preferred shares issued by P10 Intermediate in connection with the acquisition of Five Points.

As a result of that agreement, P10 Intermediate paid $ 0.1 million and $ 0.3 million for the three months ended March 31, 2022 and March 31, 2021, respectively.

As a result of that agreement, P10 Intermediate paid $ 0.1 million and $ 0.5 million for the six months ended June 30, 2022 and June 30, 2021, respectively.

This management fee was terminated effective October 20, 2021 when the Company's redeemable noncontrolling interest was converted to Class B shares in connection with the Company's IPO.

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Certain expenses incurred by the Funds are paid upfront and are reimbursed from the Funds as permissible per fund agreements.

As of March 31, 2022, the total accounts receivable from the Funds totaled $ 3.1 million , of which $ 1.8 million related to

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

reimbursable expenses and $ 1.4 million related to fees earned but not yet received.

As of June 30, 2022, the total accounts receivable from the Funds totaled $ 5.2 million , of which $ 3.0 million related to reimbursable expenses and $ 2.2 million related to fees earned but not yet received.

As of December 31, 2021 , the total accounts receivable from the Funds totaled $ 2.4 million, of which $ 1.6 million related to reimbursable expenses and $ 0.8 million related to fees earned but not yet received.

In certain instances, the Company may incur expenses related to specific products that never materialize.

The costs are then removed from the balance sheet and expensed on the Consolidated Statement of Operations.

The management fees described here are included in accounts receivable on the Consolidated Balance Sheet and the reimbursable expenses are included in due from related parties on the Consolidated Balance Sheets.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Upon the closing of the Company’s acquisition of ECG and ECP, the Advisory Agreement between ECG and Enhanced PC immediately became effective.

3 unchanged sentences

This agreement is subject to customary termination provisions.

For the three months ended March 31, 2022 and March 31, 2021, advisory fees earned or recognized under this agreement were $ 4.3 million and $ 4.8 million, respectively, and are reported in management and advisory fees on the Consolidated Statement of Operations.

As of March 31, 2022 and December 31, 2021, the receivable balance was $ 13.6 million and $ 9.5 million, respectively, and is included in due from related parties on the Consolidated Balance Sheets.

For the three and six months ended June 30, 2022, advisory fees earned or recognized under this agreement were $ 5.5 million and $ 11.1 million, respectively, and are reported in management and advisory fees on the Consolidated Statement of Operations.

For the three and six months ended June 30, 2021, advisory fees earned or recognized under this agreement were $ 4.75 million and $ 9.5 million, res pectively.

As of June 30, 2022 and December 31, 2021, the receivable balance was $ 18.1 million and $ 9.5 million, respectively, and is included in due from related parties on the Consolidated Balance Sheets.

Upon the closing of the Company’s acquisition of ECG and ECP, the Administrative Services Agreement between ECG and Enhanced Capital Holdings, Inc.

(“ECH”), the entity which holds a controlling equity interest in ECP, immediately became effective.

Under this agreement, ECG pays ECH for the use of their employees to provide services to Enhanced PC at the direction of ECG.

The Company recognized $ 2.2 million and $ 2.8 million for the three months ended March 31, 2022 and March 31, 2021, respectively, related to this agreement within compensation and benefits on our Consolidated Statements of Operations.

Under this agreement, ECG will pay ECH for the use of their employees to provide services to Enhanced PC at the direction of ECG.

The Company recognized $ 2.4 million and $ 4.6 million for the three and six months ended June 30, 2022 and $ 2.4 million and $ 5.2 million for the three and six months ended June 30, 2021, respectively, related to this agreement within compensation and benefits on our Consolidated Statements of Operations.

On September 10, 2021, Enhanced entered into a strategic partnership with Crossroads Systems, Inc, parent company of Capital Plus Financial ("CPF"), a leading certified development financial institution.

1 unchanged sentence

The loans will be held by CPF and CPF will pay an advisory fee to Enhanced.

The Company recognized $ 0.4 million for the three months ended March 31, 2022, which is included in management and advisory fees on the Consolidated Statements of Operations.

No revenues were recognized for the three months ended March 31, 2021.

The Company recognized $ 0.6 million and $ 1.0 million for the three and six months ended June 30, 2022, respectively, which is included in management and advisory fees on the Consolidated Statements of Operations.

No revenues were recognized for the three and six months ended June 30, 2021.

Upon the closing of the Bonaccord acquisition on September 30, 2021, an Advance Agreement and Secured Promissory Note was signed with BCP, an entity that was formed by employees of the Company.

For details, see Note 6.

The Company utilizes services from Altvia, a technology platform for private capital markets.

For the three months ended March 31, 2022 and March 31, 2021 the Company paid Altvia $ 0.1 million and $ 0.1 million respectively.

Commitments and Contingencies

2 unchanged sentences

These lease agreements provide for various renewal options.

Rent expense for the various leased office space and equipment was approximately $ 0.8 million for the three months ended March 31, 2022 and $ 0.5 million for the three months ended March 31, 2021.

The following table presents information regarding the Company’s operating leases as of March 31, 2022:

Rent expense for the various leased office space and equipment was approximately $ 0.8 million and $ 1.6 million for the three and six months ended June 30, 2022 and $ 0.5 million and $ 1.1 million for the three and six months ended June 30, 2021, respectively.

The following table presents information regarding the Company’s operating leases as of June 30, 2022:

Operating lease right-of-use assets

5 unchanged sentences

(Unaudited, dollar amounts stated in thousands)

The future contractual lease payments as of March 31, 2022 are as follows:

The future contractual lease payments as of June 30, 2022 are as follows:

Remainder of 2022

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To the extent that information is not available for the Company to fully determine the full year estimated impact of an item of income or tax adjustment, the Company calculates the tax impact of such item discretely.

Based on these methodologies, the Company’s effective income tax rate for the three months ended March 31, 2022 and 2021 was 25.82 % and 22.98 %, respectively.

Based on these methodologies, the Company’s effective income tax rate for the six months ended June 30, 2022 was 25.94 %.

The effective tax rate differs from the federal statutory rate of 21 % due primarily to state and local income taxes.

2 unchanged sentences

This level will be estimated based on a number of factors, especially the amount of net deferred tax assets of the Company that are actually expected to be realized, for tax purposes, in the foreseeable future.

As of March 31, 2022, the Company has recorded a $ 12.8 million valuation allowance against deferred tax assets.

There was no change to the valuation allowance during the period.

As of June 30, 2022, the Company has recorded a $ 12.8 million valuation allowance against deferred tax assets, primarily related to a note impairment.

There was no change to the valuation allowance during the six months ended June 30, 2022.

The Company monitors federal and state legislative activity and other developments that may impact our tax positions and their relation to the income tax provision.

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On July 20, 2021, the Board of Directors approved the P10 Holdings, Inc.

2021 Stock Incentive Plan (the "Plan"), which replaced the 2018 Incentive Plan, our previously existing equity compensation plan.

The Plan provides for the issuance of 3,000,000 shares available for grant, in addition to those approved in the 2018 Incentive Plan ("2018 Plan"), for a total of 9,300,000 shares (previously unadjusted for the stock split of 12,000,000 ).

2021 Stock Incentive Plan (the "Plan"), which replaced the 2018 Incentive Plan ("2018 Plan"), our previously existing equity compensation plan.

The Compensation Committee of the Board of Directors may issue equity-based awards including stock options, stock appreciation rights, restricted stock units and restricted stock awards.

Options previously granted under the 2018 Incentive Plan vest over a period of up to five years .

Options previously granted under the 2018 Plan cliff vest over a period of four or five years .

The term of each option is no more than ten years from the date of grant.

When the options are exercised, the Board of Directors has the option of issuing shares of common stock or paying a lump sum cash payment on the exercise date equal to the

When the options are exercised, the Board of Directors has the option of issuing shares of common stock or paying a lump sum cash payment on the exercise

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

difference between the common stock’s fair market value on the exercise date and the option price.

All future awards will be granted under the Plan, and no additional awards will be granted under the 2018 Plan.

date equal to the difference between the common stock’s fair market value on the exercise date and the option price.

Terms of all future awards will be granted under the Plan, and no additional awards will be granted under the 2018 Plan.

Awards granted under the 2018 Plan continue to follow the 2018 Plan.

The 2018 Plan provided for an initial 6,300,000 shares (adjusted for the reverse stock split).

The Plan provided for the issuance of 3,000,000 shares available for grant, in addition to those approved in the 2018 Incentive Plan for a total of 9,300,000 shares.

On June 17, 2022 at the Annual Meeting of Stockholders, the shareholders authorized an additional 5,000,000 of shares from the Plan creating a total of 14,300,000 shares.

On March 15, 2022, the Board of Directors approved the settlement of 1.1 million options from a grantee with a fair market value option price of $ 11.83 , less a negotiated discount of 2.5 %, totaling $ 12.5 million.

This is presented in other liabilities on the Consolidated Balance Sheets.

A summary of stock option activity for the period ended March 31, 2022 is as follows:

This was paid on June 15, 2022.

A summary of stock option activity for the six months ended June 30, 2022 is as follows:

Weighted Average

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Expired/Forfeited

Outstanding as of March 31, 2022

Exercisable as of March 31, 2022

The weighted average assumptions used in calculating the fair value of stock options granted during the three months ended March 31, 2022 and March 31, 2021 were as follows:

For the Three Months Ended March 31,

Outstanding as of June 30, 2022

Exercisable as of June 30, 2022

The weighted average assumptions used in calculating the fair value of stock options granted during the six months ended June 30, 2022 and June 30, 2021 were as follows:

For the Six Months Ended June 30,

Expected life

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The Company has granted restricted stock awards ("RSAs") to certain employees.

Holders of RSAs have no voting rights and are not eligible to receive dividends or other distributions paid with respect to any RSAs that have not vested.

Holders of RSAs have no voting rights and accrue dividends until vesting with payment being made once they vest.

All of the shares currently vest one year from the grant date.

2 unchanged sentences

Outstanding as of December 31, 2021

Outstanding as of March 31, 2022

Outstanding as of June 30, 2022

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

The Company has granted restricted stock units ("RSUs") to certain employees.

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Outstanding as of December 31, 2021

Outstanding as of March 31, 2022

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Outstanding as of June 30, 2022

Compensation expense equal to the grant date fair value is recognized for these awards over the vesting period and is included in compensation and benefits on our Consolidated Statements of Operations.

The stock-based compensation expense was $ 1.5 million and $ 0.4 million for the three months ended March 31, 2022 and March 31, 2021, respectively.

Unrecognized stock-based compensation expense related to outstanding unvested stock options as of March 31, 2022 was $ 7.5 million and is expected to be recognized over a weighted average period of 3.05 years.

The stock-based compensation expense for the three and six months ended June 30, 2022 was $ 2.7 million and $ 4.2 million and for the three and six months ended June 30, 2021 was $ 0.6 million and $ 1.0 million, respectively.

Unrecognized stock-based compensation expense related to outstanding unvested stock options as of June 30, 2022 was $ 11.5 million and is expected to be recognized over a weighted average period of 2.8 years.

Any future forfeitures will impact this amount.

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Additionally, diluted EPS reflects the potential dilution that could occur if convertible preferred shares of P10 Intermediate were converted into common shares of P10 Intermediate.

This is only applicable for the three months ended March 31, 2021 as the preferred shares of P10 Intermediate converted to Class B common shares effective with the IPO.

This is only applicable for the three and six months ended June 30, 2021 as the preferred shares of P10 Intermediate converted to Class B common shares effective with the IPO.

The following table presents a reconciliation of the numerators and denominators used in the computation of basic and diluted EPS:

For the Three Months

Ended March 31,

Numerator for earnings per share

Ended June 30,

For the Six Months

Ended June 30,

Numerator for earnings per share assuming

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Earnings per share—diluted

The computations of diluted earnings per share excluded 0.2 million options for the three months ended March 31, 2022 and 3.0 million options for the three months ended March 31, 2021, because the options and restricted stock units were anti-dilutive.

See Note 3 for more information related to the restricted stock units.

The computations of diluted earnings per share excluded options to purchase 1.4 million and 1.0 million shares of common stock for the three and six months ended June 30, 2022 and 2.9 million and 2.9 million shares for the three and six months ended June 30, 2021 , respectively, because the options were anti-dilutive.

Redeemable Noncontrolling Interest

In connection with the closing of the acquisition of Five Points on April 1, 2020, the Company formed a new subsidiary, P10 Intermediate, which was the acquiring entity of Five Points.

On April 1, 2020, P10 Intermediate issued three series (A, B and C) of redeemable convertible preferred shares.

On April 1, 2020, P10 Intermediate issued three series (A, B

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

and C) of redeemable convertible preferred shares.

On October 2, 2020 and December 14, 2020, P10 Intermediate issued two additional series (D and E) in connection with the acquisitions of TrueBridge and Enhanced.

3 unchanged sentences

In connection with the IPO on October 20, 2021, all preferred shares were contractually converted to Class B common shares.

Notes to Consolidated Financial Statements

(Unaudited, dollar amounts stated in thousands)

Subsequent Events

As further described in Note 16, on April 4, 2022, the Company made the cash payment to settle its liability with the grantee for their stock options.

The Board of Directors of the Company has declared a quarterly cash dividend of $ 0.03 per share of Class A and Class B common stock, payable on June 20, 2022, to the holders of record as of the close of business on May 31, 2022.

The Company announced that its Board of Directors has authorized a stock buyback program pursuant to which P10 may purchase up to $ 20 million of P10’s outstanding shares of Class A Common Stock, par value $ 0.001 per share.

P10 intends to fund the program through available cash balances and future operating cash flows.

These shares may be repurchased from time to time in the open market at prevailing market prices, in privately negotiated transactions, in block trades, in accordance with Rule 10b5-1 trading plans and/or through other legally permissible means.

The timing and amount of any repurchases pursuant to the program will depend on various factors including, the market price of its Class A Common Stock, trading volume, ongoing assessment of P10’s working capital needs, general market conditions, and other factors.

The buyback program does not obligate P10 to acquire any particular amount of common stock and it may be terminated or amended by the Board of Directors at any time.

In accordance with ASC 855, Subsequent Events, the Company evaluated all material events or transactions that occurred after December 31, 2021, the Consolidated Balance Sheet date, through the date the Consolidated Financial Statements were issued, and determined there have been no additional events or transactions that would materially impact the Consolidated Financial Statements.

On July 27, 2022, the Company paid down $ 12.0 million of the principal balance outstanding on the Revolver Facility reducing the outstanding balance from $ 65.9 million to $ 53.9 million.

The Board of Directors of the Company has declared a quarterly cash dividend of $ 0.03 per share of Class A and Class B common stock, payable on September 20, 2022, to the holders of record as of the close of business on August 29, 2022.

In accordance with ASC 855, Subsequent Events, the Company evaluated all material events or transactions that occurred after June 30, 2022, the Consolidated Balance Sheet date, through the date the Consolidated Financial Statements were issued, and determined there have been no additional events or transactions that would materially impact the Consolidated Financial Statements.

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-Q

Item 1. Financial Statements