rmni-20220930

(In thousands, except per share amounts)


	September 30,		December 31,
	2022		2021
ASSETS
Current assets:
Cash and cash equivalents	$	118,576	$	119,571
Restricted cash	417		419
Accounts receivable, net of allowance of $744 and $576, respectively	59,223		135,447
Deferred contract costs, current	16,372		14,985
Short-term investments	11,147		—
Prepaid expenses and other	21,253		16,340
Total current assets	226,988		286,762
Long-term assets:
Property and equipment, net of accumulated depreciation and amortization of $14,754 and $13,278, respectively	5,565		4,435
Operating lease right-of-use assets	10,843		12,722
Deferred contract costs, noncurrent	22,548		21,524
Deposits and other	3,975		1,786
Deferred income taxes, net	63,430		64,033
Total assets	$	333,349	$	391,262
LIABILITIES, REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Current maturities of long-term debt	$	4,227	$	3,664
Accounts payable	8,301		5,708
Accrued compensation, benefits and commissions	35,993		36,558
Other accrued liabilities	23,886		26,124
Operating lease liabilities, current	4,123		4,227
Deferred revenue, current	212,070		253,221
Total current liabilities	288,600		329,502
Long-term liabilities:
Long-term debt, net of current maturities	71,445		79,655
Deferred revenue, noncurrent	36,117		47,047
Operating lease liabilities, noncurrent	9,987		12,511
Other long-term liabilities	2,575		2,933
Total liabilities	408,724		471,648
Commitments and contingencies (Note 9)
Stockholders’ deficit:

Preferred stock; $0.0001 par value. Authorized 99,820 shares (excluding 180 shares of Series A Preferred Stock); no other series has been designated	—		—
Common stock; $0.0001 par value. Authorized 1,000,000 shares; issued and outstanding 88,223 and 87,107 shares, respectively	9		9
Additional paid-in capital	154,111		149,234
Accumulated other comprehensive loss	(5,382)		(2,724)
Accumulated deficit	(222,997)		(225,789)
Treasury stock, at cost	(1,116)		(1,116)
Total stockholders' deficit	(75,375)		(80,386)
Total liabilities and stockholders' deficit	$	333,349	$	391,262

(In thousands, except per share amounts)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenue	$	101,931	$	95,642	$	301,041	$	275,151
Cost of revenue	39,271		33,376		113,822		101,807
Gross profit	62,660		62,266		187,219		173,344
Operating expenses:
Sales and marketing	35,934		32,527		103,840		96,067
General and administrative	18,454		15,631		57,267		48,728
Impairment charges related to operating right of use assets	—		—		—		393
Litigation costs and related recoveries:
Professional fees and other costs of litigation	6,145		6,581		12,837		14,130
Insurance costs and recoveries, net	92		—		(389)		—
Litigation costs and related recoveries, net	6,237		6,581		12,448		14,130
Total operating expenses	60,625		54,739		173,555		159,318
Operating income	2,035		7,527		13,664		14,026
Non-operating income and (expenses):
Interest expense	(1,167)		(653)		(2,974)		(738)
Loss on change in fair value of redeemable warrants	—		(2,053)		—		(3,023)
Other income (expenses), net	(1,329)		(1,161)		(2,696)		(885)
Income (loss) before income taxes	(461)		3,660		7,994		9,380
Income taxes	56		(1,729)		(5,202)		(4,218)
Net income (loss)	(405)		1,931		2,792		5,162
Other comprehensive income (loss):
Foreign currency translation loss	(1,667)		(454)		(3,878)		(2,398)
Derivative instrument adjustments, net of tax	1,220		—		1,220		—
Comprehensive income (loss)	$	(852)	$	1,477	$	134	$	2,764

Net income (loss) attributable to common stockholders	$	(405)	$	(6,691)	$	2,792	$	(21,382)

Net income (loss) per share attributable to common stockholders:
Basic	$	—	$	(0.08)	$	0.03	$	(0.26)
Diluted	$	—	$	(0.08)	$	0.03	$	(0.26)
Weighted average number of shares of Common Stock outstanding:
Basic	87,965		86,189		87,441		83,449
Diluted	87,965		86,189		89,054		83,449


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Common Stock, Shares
Beginning of period	87,529		85,704		87,107		76,406
Exercise of stock options for cash	193		383		518		1,183
Restricted stock units vested	701		708		1,391		1,456
Issuance of Common Stock	—		—		60		7,750
Treasury shares	—		(137)		—		(137)
Retired shares of Common Stock	(200)		—		(853)		—
End of period	88,223		86,658		88,223		86,658
Total Stockholders' Deficit, beginning of period	$	(76,487)	$	(156,299)	$	(80,386)	$	(203,060)
Common Stock, Amount
Beginning of period	9		9		9		8
Exercise of stock options for cash	—		—		—		—
Restricted stock units vested	—		—		—		—
Issuance of Common Stock	—		—		—		1
Treasury shares	—		—		—		—
Retired shares of Common Stock	—		—		—		—
End of period	9		9		9		9
Additional Paid-in Capital
Beginning of period	152,147		143,801		149,234		98,258
Stock based compensation expense	2,443		2,393		8,653		7,104
Exercise of stock options for cash	513		1,933		964		5,046
Restricted stock units vested	—		—		—		—
Issuance of Common Stock in March 2021 Offering, net	—		—		—		55,641
Retired shares of Common Stock	(992)		—		(4,740)		—
Redemption of 60,000 shares of Series A Preferred Stock:
Accretion related to redemption of Series A Preferred Stock	—		(8,020)		—		(13,693)
Make-whole dividends related to redemption of Series A Preferred Stock	—		(602)		—		(2,945)
Return on repurchase of Series A Preferred Stock shares in January 2021	—		—		—		(38)
Accretion of discount on Series A Preferred Stock	—		—		—		(2,277)
Accrued dividends on Series A Preferred Stock:
Payable in cash	—		—		—		(5,839)
Payable in kind	—		—		—		(1,752)
End of period	154,111		139,505		154,111		139,505
Accumulated Other Comprehensive Loss
Beginning of period	(4,935)		(2,262)		(2,724)		(318)
Other comprehensive loss	(447)		(454)		(2,658)		(2,398)
End of period	(5,382)		(2,716)		(5,382)		(2,716)
Accumulated Deficit
Beginning of period	(222,592)		(297,777)		(225,789)		(301,008)
Net income (loss)	(405)		1,931		2,792		5,162
End of period	(222,997)		(295,846)		(222,997)		(295,846)
Treasury Stock	(1,116)		(1,116)		(1,116)		(1,116)
Total Stockholders' Deficit, end of period	$	(75,375)	$	(160,164)	$	(75,375)	$	(160,164)

(In thousands)


	Nine Months Ended September 30,
	2022		2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	2,792	$	5,162
Adjustments to reconcile net income to net cash provided by operating activities:
Loss on change in fair value of redeemable warrants	—		3,023
Stock-based compensation expense	8,653		7,104
Depreciation and amortization	1,871		1,772
Accretion and amortization of debt discount and issuance costs	728		196
Deferred income taxes	327		1
Impairment charges related to operating right of use assets	—		393
Amortization and accretion related to operating right of use assets	4,140		4,625
Changes in operating assets and liabilities:
Accounts receivable	75,068		41,021
Prepaid expenses, deposits and other	(6,417)		(4,289)
Deferred contract costs	(2,412)		(1,780)
Accounts payable	2,710		5,605
Accrued compensation, benefits, commissions and other liabilities	(3,842)		(3,940)
Deferred revenue	(46,861)		(11,079)
Net cash provided by operating activities	36,757		47,814
CASH FLOWS USED IN INVESTING ACTIVITIES:
Capital expenditures	(3,144)		(1,455)
Investment purchases	(11,148)		—
Net cash used in investing activities	(14,292)		(1,455)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds related to Common Stock issuances in March 2021 Offering	—		56,965
Payments of professional fees related to Common Stock issuances in March 2021 Offering	(27)		(1,296)
Proceeds from issuance of Credit Facility	—		89,313
Debt issuance costs paid	—		(4,013)
Principal payments on the Credit Facility	(8,375)		(1,125)
Payments to repurchase shares of Series A Preferred Stock	—		(156,753)
Payments of cash dividends on Series A Preferred Stock	—		(12,679)
Payments to repurchase and retire Common Stock	(4,740)		—
Payments for treasury stock	—		(1,116)
Principal payments on capital leases	(235)		(330)
Proceeds from exercise of employee stock options	965		5,044
Net cash used in financing activities	(12,412)		(25,990)
Effect of foreign currency translation changes	(11,050)		(4,838)
Net change in cash, cash equivalents and restricted cash	(997)		15,531
Cash, cash equivalents and restricted cash at beginning of period	119,990		87,909
Cash, cash equivalents and restricted cash at end of period	$	118,993	$	103,440


	Nine Months Ended September 30,
	2022		2021
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest	$	2,195	$	524
Cash paid for income taxes	1,886		3,053
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Discount on shares of Common Stock issued in March 2021 Public Offering:
Underwriter discounts and commissions	$	—	$	2,948
Underwriter expenses	—		1,050
Accrued professional fees related to the issuance of Common Stock	—		27
Redeemable Series A Preferred Stock Dividends and Accretion:
Accrued cash dividends	$	—	$	—
Accrued PIK dividends	—		—
Accretion of discount on Series A Preferred Stock	—		2,277
Issuance of Series A Preferred Stock for PIK dividends	—		2,891

Increase in payables for debt issuance costs	$	—	$	145
Increase in principal related to the Credit Facility discount	—		28
Decrease in payables for capital expenditures	(2)		—

In August 2020, the FASB issued ASU 2020-6, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40). The guidance eliminates the beneficial conversion and cash conversion accounting for convertible instruments. The new guidance also modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The new guidance was effective for us as of January 1, 2022. The impact of the adoption of this guidance did not have a material impact on our Unaudited Condensed Consolidated Financial Statements.

Activity for deferred contract costs consisted of the following (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Deferred contract costs, current and noncurrent, as of the beginning of period	$	39,709	$	36,561	$	36,509	$	34,945
Capitalized commissions during the period	3,817		4,295		15,620		13,437
Amortized deferred contract costs during the period	(4,606)		(4,132)		(13,209)		(11,658)
Deferred contract costs, current and noncurrent, as of the end of period	$	38,920	$	36,724	$	38,920	$	36,724


	Dividends Payable in:				Total		Dividends
	Cash		PIK		Dividends		Per Share
Dividends payable as of December 31, 2020	$	3,842	$	1,193	$	5,035	$	32.50
Cash Dividends @ 10% per annum	3,660		—		3,660		23.40
PIK Dividends @ 3% per annum	—		1,098		1,098		7.02
Fractional PIK shares settled for cash	47		(47)		—		—
Less dividends settled January 4, 2021	(4,009)		(1,193)		(5,202)		(33.26)
Dividends payable as of March 31, 2021	3,540		1,051		4,591		32.14
Cash Dividends @ 10% per annum	2,179		—		2,179		25.00
PIK Dividends @ 3% per annum	—		654		654		7.50
Fractional PIK shares settled for cash	7		(7)		—		—
Less dividends settled April 1, 2021	(3,540)		(1,051)		(4,591)		(52.68)
Dividends payable as of June 30, 2021	2,186		647		2,833		32.51
Less dividends settled on July 1, 2021	(2,186)		(647)		(2,833)		(32.27)
Dividends payable as of September 30, 2021	$	—	$	—	$	—	$	—

addressed certain accounting and reporting considerations related to warrants similar to the Company’s warrants to purchase approximately 6.1 million shares of Common Stock at $11.50 per share (the “GP Sponsor Private Placement Warrants”), and upon review of ASC 815-40, Contracts in Entity’s Own Equity, the Company determined that its GP Sponsor Private Placement Warrants should have been classified as a liability instead of equity. On October 29, 2021, the original holder of the warrants (the “GP Sponsor”) sold the warrants for $1.04 per warrant to outside holders. As a result of the sale, the new holders of the GP Sponsor Private Placement Warrants had the same rights as the holders of the Company’s warrants to purchase approximately 8.6 million shares of the Company’s Common Stock at $11.50 per share (the “Public Warrants”). Therefore, as of October 29, 2021, the Company reclassified the liability for redeemable warrants to additional paid-in capital for $6.3 million. See Note 12 for information regarding the fair value of the GP Sponsor Private Placement Warrants.

Rimini Street, Inc. (“RSI”) was incorporated in the state of Nevada in September 2005. In May 2017, RSI entered into an Agreement and Plan of Merger (the “Merger Agreement”) with GP Investments Acquisition Corp. (“GPIA”), a publicly-held special purpose acquisition company (“SPAC”) incorporated in the Cayman Islands and formed for the purpose of effecting a business combination with one or more businesses. The Merger Agreement was approved by the respective shareholders of RSI and GPIA in October 2017, and closing occurred on October 10, 2017, resulting in (i) the merger of a wholly-owned subsidiary of GPIA with and into RSI, with RSI as the surviving corporation, after which (ii) RSI merged with and into GPIA, with GPIA as the surviving corporation and renamed “Rimini Street, Inc.” (referred to herein as “RMNI”, as distinguished from RSI, which is defined as the predecessor entity with the same legal name) immediately after consummation of the second merger. Prior to the consummation of the mergers, the ultimate parent entity of GPIA was GP Investments, Ltd. (“GP Investments”), a global private equity firm and a former affiliate of the Company. An affiliate of GP Investments was a member of the Company’s Board of Directors until May 5, 2021.

In addition, an affiliate of Adams Street Partners and its affiliates (collectively referred to as “ASP”) is also a member of the Company’s Board of Directors. As of September 30, 2022, ASP owned approximately 26.7% of the Company’s issued and outstanding shares of Common Stock. In July 2018, ASP acquired 19,209 shares of Series A Preferred Stock and approximately 0.4 million shares of Common Stock for total consideration of approximately $19.2 million, all of which shares of Series A Preferred Stock were redeemed by the Company in 2021 on the same terms and conditions as for all other holders of Series A Preferred Stock.

This Quarterly Report on Form 10-Q (this “Report”) includes forward-looking statements. All statements other than statements of historical facts contained in this Report, including statements regarding our future results of operations and financial position, business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar expressions that convey uncertainty of future events or outcomes are intended to identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements include, but are not limited to, information concerning:

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those referred to under “Risk Factors” in Part II, Item 1A of this Report. Moreover, we operate in very competitive and rapidly changing markets. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this Report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. The forward-looking statements in this Report are made as of the date of the filing, and except as required by law, we disclaim and do not undertake any obligation to update or revise publicly any forward-looking statements in this Report. You should read this Report and the documents that we reference in this Report and have filed with the SEC as exhibits with the understanding that our actual future results, levels of activity and performance, as well as other events and circumstances, may be materially different from what we expect.

Certain figures, such as interest rates and other percentages included in this section have been rounded for ease of presentation. Percentage figures included in this section have not in all cases been calculated based on such rounded figures but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this section may vary slightly from those obtained by performing the same calculations using the figures in our Unaudited Condensed Consolidated Financial Statements or in the associated text. Certain other amounts that appear in this section may similarly not sum due to rounding.

We were incorporated as Rimini Street, Inc. (“RSI”) in the state of Nevada in September 2005. In May 2017, RSI entered into an Agreement and Plan of Merger (the “Merger Agreement”) with GP Investments Acquisition Corp. (“GPIA”), a publicly-held special purpose acquisition company incorporated in the Cayman Islands and formed for the purpose of effecting a business combination with one or more businesses. Substantially all of GPIA’s assets consisted of cash and cash equivalents. The Merger Agreement was approved by the respective shareholders of RSI and GPIA in October 2017, and closing occurred on October 10, 2017, resulting in (i) the merger of a wholly-owned subsidiary of GPIA with and into RSI, with RSI as the surviving corporation, after which (ii) RSI merged with and into GPIA, with GPIA as the surviving corporation. Prior to consummation of the mergers, GPIA domesticated as a Delaware corporation (the “Delaware Domestication”). Immediately after the Delaware Domestication and the consummation of the second merger, GPIA was renamed “Rimini Street, Inc.” (referred to herein as the Company, as distinguished from RSI with the same legal name).

In July 2022, we announced the global availability of Rimini Protect™, our innovative suite of security solutions providing “zero-day” proactive security protection for Oracle and SAP environments, including applications, middleware and databases. We believe the suite of offerings in our Rimini Protect™ security solutions provide a faster and more comprehensive layer of security surrounding enterprise IT infrastructure and applications than traditional, dated software vendor patching models by using active security controls that monitor activities in real-time to identify malicious actions and proactively block processes that attempt to exploit known and new “zero-day” vulnerabilities.

In November 2019, we announced the global availability of our Application Management Services (“AMS”) for Oracle, which includes coverage for Oracle Database, Middleware and a wide range of Oracle applications including E-Business Suite, JD Edwards, PeopleSoft and Siebel. In addition to leveraging our support services for Oracle that replaces expensive and less robust software vendor annual support with a more responsive and comprehensive support offering, our clients can now have us manage their Oracle systems day-to-day with an integrated application management and support service provided by a single trusted vendor. As an integrated service, we believe we can provide clients a better model, better people, and better outcomes with higher satisfaction and significant savings of time, labor and money. The AMS for Oracle includes system administration, operational support, health monitoring and enhancement support.

In August 2019, we announced plans to globally offer AMS for SAP enterprise software, expanding the scope of support services we offer clients globally. This AMS service is in addition to our traditional enterprise Support Services. We are already providing this new SAP AMS service to clients in North and South America. The service includes system administration and SAP Basis support, system health monitoring with proactive analysis, preventative system recommendations and event detection; and enhancement support for complex SAP software landscapes.

In 2018 we announced support for Software as a Service (“SaaS”) solutions beginning with Salesforce products. As a partner of Salesforce, we provide our award-winning service and support for custom code, release updates and application integrations in addition to ongoing administrative, configuration and enhancement of Salesforce’s industry leading cloud solutions. We also provide support to clients for additional SaaS solutions that we will formally announce in the future. By providing support for SaaS as well as traditionally licensed enterprise software, Rimini Street unifies support for its clients across applications and software delivery models from one trusted provider, creating efficiencies and savings, simplifying support processes and enabling improved support outcomes.

Enterprise software support products and services is one of the largest categories of overall global information technology (“IT”) spending. We believe core enterprise resource planning (ERP), client relationship management (CRM), product lifecycle management (PLM) and technology software platforms have become increasingly important in the operation of mission-critical business processes over the last 30 years, and also that the costs associated with failure, downtime, security exposure and maintaining the tax, legal and regulatory compliance of these core software systems have also increased. As a result, we believe that licensees often view software support as a mandatory cost of doing business, resulting in recurring and highly profitable revenue streams for enterprise software vendors. For example, for fiscal year 2021, SAP reported that support revenue represented approximately 41% of its total revenue. For fiscal year 2022, Oracle reported a margin of 83% for cloud services and license support.

We believe that software vendor support is an increasingly costly model that has not evolved to offer licensees the responsiveness, quality, breadth of capabilities or value needed to meet the needs of licensees. Organizations are under increasing pressure to reduce their IT costs while also delivering improved business performance through the adoption and integration of emerging technologies, such as mobile, virtualization, internet of things (“IoT”) and cloud computing. Today, however, the majority of IT budgets are spent operating and maintaining existing infrastructure and systems, in part as a result of software vendor policies and support models that are designed to benefit the vendor and force organizations to follow a vendor-dictated roadmap. As a result, we believe organizations are increasingly seeking ways to create competitive advantage and growth by redirecting budgets from expensive maintenance programs and costs to new technology investments that provide greater strategic value. We believe our software products and services help clients achieve these objectives by reducing the total cost of support.

We believe that AMS for enterprise software is a large market with significant unmet needs in client satisfaction and value. Traditional AMS providers compete on price, but the traditional AMS model is broken with a focus on a “land and expand” model based on initial cheaper, less-skilled workers but higher costs over time and frequently poor client satisfaction or degradation in service over time. Providers usually contract for lower-cost services with a goal to grow revenue through scope creep by adding hours to open tickets or selling new project work. These lower-cost AMS support models sound cost-effective, but their contractual structures can both enable and incent traditional AMS providers to maximize their own revenue at the expense of their clients by “addressing” issues (sometimes neither quickly nor efficiently), but not necessarily resolving them or their root causes. In addition, traditional AMS offerings are disparate and separate from software vendor support, with inherent inefficiencies and gaps that further limit responsiveness, root cause analysis and business value.

We believe organizations are realizing the value of an integrated, expert-led Support and AMS offering that eliminates inefficiencies, realizes joint value from the resolution of root causes that reduce issue volumes over time, and improves client satisfaction. Through our solution offerings, Rimini Street provides expert, ultra-responsive support and AMS, functioning as an extension of IT teams, with engineers available 24x7x365 around the globe for all AMS and enterprise software projects, and to fill skill gaps or help with rightsizing enterprise teams. Rimini Street teams deliver a wide variety of desired outcomes for a broad range of use cases such as supporting entire enterprise software systems, reducing costs, clearing backlogs, or facilitating the redeployment of IT teams for more strategic initiatives.

As of September 30, 2022, we employed over 1,870 professionals and supported over 3,000 active clients globally, including 75 Fortune 500 companies and 16 Fortune Global 100 companies across a broad range of industries. We define an active client as a distinct entity, such as a company, an educational or government institution, or a business unit of a company that purchases our services to support a specific product. For example, we count as two separate active client instances in circumstances where we provide support for two different products to the same entity.

Our subscription-based revenue provides a strong foundation for, and visibility into, future period results. For the three months ended September 30, 2022 and 2021, we generated revenue of $101.9 million and $95.6 million, respectively, representing an increase of 7%. During the three months ended September 30, 2022, we had a net loss of $0.4 million, and as of September 30, 2022, we had an accumulated deficit of $223.0 million. Approximately 52% and 53% of our revenue was generated in the United States for the three months ended September 30, 2022 and 2021, respectively. Approximately 48% and 47% of our revenue was generated in foreign jurisdictions for the three months ended September 30, 2022 and 2021, respectively.

In the first quarter of 2020, the emergence of the COVID-19 pandemic created rapidly evolving and unpredictable impacts on global society, economies, financial markets and business practices. These rapidly evolving and unpredictable impacts continued as virus variants resulted in additional outbreaks during 2021 and 2022. In response to the COVID-19 pandemic, we implemented business continuity measures and will continue to respond to the continuing impact of the COVID-19 pandemic as circumstances dictate while continuing to prioritize employee and community health and safety. We have reopened our offices located in the United States to verified vaccinated employees and guests and we have reinstated employee travel and in-person marketing, sales and employee appreciation events in accordance with applicable regional guidance.

As a result of certain measures that we took in response to the COVID-19 pandemic, we have realized reduced costs of travel, reductions in costs resulting from cancelling certain in-person marketing events, reductions in office operating costs and potential rent abatement related to office closures around the world. As many of the governmental restrictions implemented to contain the COVID-19 pandemic are no longer in effect, we expect that our travel and entertainment costs will continue to increase. However, there can be no assurances that additional restrictions will not be implemented again in the future that would decrease travel and entertainment activity and related costs. While some of our offices have re-opened to verified vaccinated employees and guests, our offices will not fully re-open until local authorities permit us to, and our own criteria and conditions to ensure employee health and safety are satisfied. We continue to expect to offset some of these reduced costs with accelerated investments including implementing virtual sales and other marketing programs, special compensation bonuses for lower-paid employees and special compensation bonuses for employees who have tested positive for COVID-19, which bonuses have been paid from 2020 through the nine months ended September 30, 2022. The cost of these special bonuses were more than offset by

We have experienced some clients not renewing our services as their businesses have been adversely impacted during the pandemic and the resulting global economic uncertainty. In addition, the Russian invasion of Ukraine in early fiscal 2022 has led to further economic disruption. While we do not operate in Russia or the Ukraine, the conflict, together with fiscal and monetary policy adopted during the pandemic, has increased inflationary cost pressures, negatively impacting the global economy and causing the U.S. Federal Reserve began to raise interest rates in March 2022. We expect additional rate increases in the future. Despite these macroeconomic and geopolitical pressures, we expect to continue to be able to market, sell and provide our current and future products and services to clients globally. We also expect to continue investing in the development and improvement of new and existing products and services to address client needs. Further, although our operations are influenced by general economic conditions, we do not believe that inflation had a significant net impact on our revenue or results of operations during the three months and nine months ended September 30, 2022.

The extent to which any lingering impacts of the COVID-19 pandemic, rising inflation, interest rate increases and continuing global economic and geopolitical uncertainty impact our business going forward, however, will depend on numerous evolving factors we cannot reliably predict, including continued governmental and business actions in response to any lingering impacts of the pandemic and increasing global economic uncertainty, including the possibility of recession or financial market instability. These factors may adversely impact consumer, business, and government spending on technology as well as our clients’ ability to pay for our services on an ongoing basis. This uncertainty also affects management’s accounting estimates and assumptions, which could result in greater variability in a variety of areas that depend on these estimates and assumptions, including receivables and forward-looking guidance. As such, the effects of the COVID-19 pandemic, rising inflation, interest rate increases and other negative impacts on the global economy may not be fully reflected in our financial results until future periods. Refer to “Risk Factors” (Part II, Item 1A of this Report) for a discussion of these factors and other risks.

On March 27, 2020, the CARES Act was signed into law in the United States to address the economic impact of the COVID-19 pandemic. We elected to defer payroll tax payments, which totaled $3.2 million, as permitted by the CARES Act (such deferred payroll taxes are due in two installments: 50% by December 31, 2021 and 50% by December 31, 2022). We paid $1.6 million in December 2021 and expect to pay the remaining amount by December 31, 2022, as required under the CARES Act. We continue to monitor any effects that may result from the CARES Act and other similar legislation or actions in geographies in which our business operates.

On October 10, 2022, our Public Warrants, including the one-half Public Warrant underlying each of our then-outstanding units, and our Private Placement Warrants expired unexercised in accordance with their terms. Prior to this date, each of the units consisted of one-half Public Warrant and one share of our Common Stock. As such, upon the expiration of the Public Warrants, our units were separated into the component underlying securities so that each former unit holder became the beneficial owner of one share of our Common Stock.

On February 27, 2022, the Board of Directors approved the adoption of a stock repurchase program to acquire up to $15.0 million of our Common Stock both on the open market and in privately negotiated transactions, including through Rule 10b5-1 plans, through March 4, 2024, subject to compliance with our Credit Facility, which was amended effective January 14, 2022 to increase the aggregate value of the shares of Common Stock that could be acquired by us to no greater than $15.0 million during the term of the Credit Facility, provided that all other applicable conditions and legal requirements are satisfied.

Since we founded our company, we have made the expansion of our client base a priority. We believe that our ability to expand our client base is an indicator of the growth of our business, the success of our sales and marketing activities, and the value that our services bring to our clients. We define an active client as a distinct entity, such as a company, an educational or government institution, or a business unit of a company that purchases our services to support a specific product. For example, we count as two separate active clients when support for two different products is being provided to the same entity. As of September 30, 2022 and 2021, we had over 3,000 and 2,790 active clients, respectively.

Our consolidated statements of operations for the three months ended September 30, 2022 and 2021, are presented below (in thousands):


	Three Months Ended September 30,						Variance
	2022			2021			Amount		Percent
Revenue	$	101,931		$	95,642		$	6,289	6.6%
Cost of revenue:
Employee compensation and benefits	25,493			23,174			2,319		10.0%
Engineering consulting costs	6,252			4,648			1,604		34.5%
Administrative allocations (1)	3,970			3,574			396		11.1%
All other costs	3,556			1,980			1,576		79.6%
Total cost of revenue	39,271			33,376			5,895		17.7%
Gross profit	62,660			62,266			394		0.6%
Gross margin	61.5		%	65.1		%
Operating expenses:
Sales and marketing	35,934			32,527			3,407		10.5%
General and administrative	18,454			15,631			2,823		18.1%
Litigation costs and related recoveries, net	6,237			6,581			(344)		(5.2)%
Total operating expenses	60,625			54,739			5,886		10.8%
Operating income	2,035			7,527			(5,492)		(73.0)%
Non-operating income and (expenses):
Interest expense	(1,167)			(653)			(514)		78.7%
Loss on change in fair value of redeemable warrants	—			(2,053)			2,053		(100.0)%
Other income (expenses), net	(1,329)			(1,161)			(168)		14.5%
Income (loss) before income taxes	(461)			3,660			(4,121)		(112.6)%
Income taxes	56			(1,729)			1,785		(103.2)%
Net income (loss)	$	(405)		$	1,931		$	(2,336)	(121.0)%

Revenue. Revenue increased from $95.6 million for the three months ended September 30, 2021 to $101.9 million for the three months ended September 30, 2022, an increase of $6.3 million or 7%. The increase was driven by an 5% increase in the average number of unique clients from 1,420 for the three months ended September 30, 2021 to 1,491 for the three months ended September 30, 2022. On a geographic basis, United States revenue grew from $50.5 million for the three months ended September 30, 2021 to $53.4 million for the three months ended September 30, 2022, an increase of $2.9 million or 6%. Our international revenue grew from $45.2 million for the three months ended September 30, 2021 to $48.5 million for the three months ended September 30, 2022, an increase of $3.3 million or 7%.

Cost of revenue. Cost of revenue increased from $33.4 million for the three months ended September 30, 2021 to $39.3 million for the three months ended September 30, 2022, an increase of $5.9 million or 18%. The key drivers related to the cost of revenue increase were a $2.3 million increase in employee compensation costs, a $1.6 million increase in engineering consulting costs and a $1.9 million increase in administrative allocations and all other costs. The compensation cost increase was attributable to an increase of 24% in the average number of employees required to support our revenue growth.

processes, including processes adjudicated as infringing at trial, that we ceased using no later than July 2014, which we subsequently appealed to the Court of Appeals. In August 2019, the Court of Appeals affirmed the permanent injunction issued by the District Court, while also correcting certain legal errors that narrowed the scope of the injunction. As a result of the injunction, we have incurred and expect to incur additional expenses in the range of 1% to 2% of revenue for additional labor costs because, as drafted, the injunction contains language that could be read to cover some current support practices (Process 2.0) that are being litigated in the “Rimini II” lawsuit and that have not been found to be infringing.

Gross profit. Gross profit increased slightly from $62.3 million for the three months ended September 30, 2021 compared to $62.7 million for the three months ended September 30, 2022, an increase of $0.4 million or 1%. Gross profit margin for the three months ended September 30, 2021 was 65.1% compared to 61.5% for the three months ended September 30, 2022. For the three months ended September 30, 2022, the total cost of revenue increased by 18% compared to an increase in revenue of 7% for the three months ended September 30, 2022. As a result, our gross profit margin declined by 360 basis points period over period.

Sales and marketing expenses. As a percentage of our revenue, sales and marketing expenses were 35% and 34% for the three months ended September 30, 2022 and 2021, respectively. In dollar terms, sales and marketing expenses increased from $32.5 million for the three months ended September 30, 2021 to $35.9 million for the three months ended September 30, 2022, an increase of $3.4 million or 10%. This increase was primarily due to (i) an increase in employee compensation and benefits of $1.9 million, (ii) an increase in advertising and marketing costs of $1.0 million and (iii) an increase in travel and entertainment costs of $0.8 million and (iii) an increase in administrative allocations and all other costs of $0.1 million. These increases were offset, in part, by a decrease in recruitment costs of $0.4 million. We will continue to accelerate our future revenue growth by investing in more resources.

General and administrative expenses. General and administrative expenses increased from $15.6 million for the three months ended September 30, 2021 to $18.5 million for the three months ended September 30, 2022, an increase of $2.8 million or 18%. This increase was comprised of several items, which included (i) increased costs in salaries, wages and benefits of $0.9 million as the average number of employees increased by 23%, (ii) an increase of our computer software and license costs of $0.9 million, (iii) an increase in travel and entertainment expenses of $0.6 million and (iv) an increase in all other costs of $0.7 million for the three months ended September 30, 2022. These unfavorable variances were offset, in part, by an increase in administrative allocations of $0.3 million.

Looking forward on a quarter-over-quarter basis, we are monitoring the demand for our services in light of any potential future lingering impacts of the COVID-19 pandemic and the current global economic conditions and will adjust our expenditures accordingly. However, we expect to incur higher expenses associated with supporting the growth of our business, both in terms of size and geographical diversity, and to meet the increased compliance requirements associated with no longer being classified as an “emerging growth company” or “smaller reporting company” for purposes of SEC reporting. Our company costs that are expected to increase in the future include costs relating to additional information systems costs, costs for additional personnel in our accounting, human resources, IT and legal functions, SEC and Nasdaq fees, and incremental professional, legal, audit and insurance costs. As a result, not taking into account temporary reductions in certain expenses resulting from the COVID-19 pandemic, we expect our general and administrative expenses related to public company costs will continue to increase in future periods.

was primarily due to the timing of trial costs. During the three months ended September 30, 2022, we incurred trial costs associated with our upcoming November 29, 2022 trial related to Rimini II. During the three months ended September 30, 2021, we incurred costs associated with the September 2021 hearing related to determining if we had been in contempt of the permanent injunction. Based on the trial calendar being set, we anticipate that our litigation related expenses will now be in the mid-$20 million range for 2022.

Insurance costs and related recoveries, net increased from no activity for the three months ended September 30, 2021 to a net expense of $0.1 million for the three months ended September 30, 2022. We are self-insured for any costs related to any current or future intellectual property litigation. We currently believe our cash on hand, accounts receivable and contractually committed backlog provides us with sufficient liquidity to cover our ongoing attorneys’ fees and related costs, such as travel, hotels and consultants, associated with ongoing litigation, including Rimini II.

Interest expense. Interest expense increased from $0.7 million for the three months ended September 30, 2021 to $1.2 million for the three months ended September 30, 2022, an increase of $0.5 million. Interest expense increased primarily due to us entering into a five-year Credit Facility for $90 million on July 20, 2021, resulting in only 73 days of interest in the prior period as well as an increase in the LIBOR rate during the three months ended September 30, 2022. In addition, we incurred $0.1 million of interest costs related to payments associated with our interest rate swap, which was entered into on May 18, 2022.

Loss on change in fair value of redeemable warrants. Loss on change in fair value of redeemable warrants amounted to a loss of $2.1 million for the three months ended September 30, 2021 as the fair value per warrant changed from $0.51 per warrant as of June 30, 2021 to $0.85 per warrant as of September 30, 2021. On October 29, 2021, the GP Sponsor Private Placement Warrants were sold by the original holder to unaffiliated parties. As a result, the GP Sponsor Private Placement Warrants were determined to be no longer treated as a liability. Hence, there is no longer any mark to market activity recorded for each period related to these warrants. The GP Sponsor Private Placement Warrants expired unexercised on October 10, 2022.

Other income (expenses), net. Other income (expenses), net is primarily comprised of interest income, foreign exchange gains and losses, and other non-operating income and expenses. For the three months ended September 30, 2022, net other expenses of approximately $1.3 million was comprised primarily of foreign exchange losses of approximately $1.4 million. For the three months ended September 30, 2022, we continued to experience a significant change in foreign currency exchange rates as the U.S. dollar strengthened against the majority of foreign currencies where our foreign entities operate. These transactions are designated in foreign currencies and impacted us unfavorably during the three months ended September 30, 2022. For the three months ended September 30, 2021, net other expense of $1.2 million was also comprised primarily of foreign exchange losses of approximately $1.1 million.

Income tax expense. We had income tax expense of $1.7 million for the three months ended September 30, 2021 compared to an income tax benefit of $0.1 million for the three months ended September 30, 2022. At the end of fiscal year 2021, we determined that it was more likely than not that we could benefit from our deferred tax assets based on all of the available evidence, resulting in a significant reduction in our valuation allowance. For the three months ended September 30, 2022, our United States operations were subject to income taxes, which is the primary reason for the increase in income tax expense. For the three months ended September 30, 2021, our income taxes were primarily attributable to income taxes on our foreign operations and foreign withholding taxes.


	Nine Months Ended September 30,				Variance
	2022		2021		Amount		Percent
Revenue	$	301,041	$	275,151	$	25,890	9.4%
Cost of revenue:
Employee compensation and benefits	77,562		71,522		6,040		8.4%
Engineering consulting costs	16,397		13,663		2,734		20.0%
Administrative allocations (1)	11,693		10,883		810		7.4%
All other costs	8,170		5,739		2,431		42.4%
Total cost of revenue	113,822		101,807		12,015		11.8%
Gross profit	187,219		173,344		13,875		8.0%
Gross margin	62.2%		63.0%
Operating expenses:
Sales and marketing	103,840		96,067		7,773		8.1%
General and administrative	57,267		48,728		8,539		17.5%
Impairment charges related to right of use assets	—		393		(393)		(100.0)%
Litigation costs and related recoveries, net	12,448		14,130		(1,682)		(11.9)%
Total operating expenses	173,555		159,318		14,237		8.9%
Operating income	13,664		14,026		(362)		(2.6)%
Non-operating income and (expenses):
Interest expense	(2,974)		(738)		(2,236)		303.0%
Loss on change in fair value of redeemable warrants	—		(3,023)		3,023		(100.0)%
Other income (expenses), net	(2,696)		(885)		(1,811)		204.6%
Income before income taxes	7,994		9,380		(1,386)		(14.8)%
Income taxes	(5,202)		(4,218)		(984)		23.3%
Net income	$	2,792	$	5,162	$	(2,370)	(45.9)%

Revenue. Revenue increased from $275.2 million for the nine months ended September 30, 2021 to $301.0 million for the nine months ended September 30, 2022, an increase of $25.9 million or 9%. The increase was driven by an 8% increase in the average number of unique clients from 1,377 for the nine months ended September 30, 2021 to 1,483 for the nine months ended September 30, 2022. On a geographic basis, United States revenue grew from $147.6 million for the nine months ended September 30, 2021 to $159.6 million for the nine months ended September 30, 2022, an increase of $12.0 million or 8%. Our international revenue grew from $127.6 million for the nine months ended September 30, 2021 to $141.4 million for the nine months ended September 30, 2022, an increase of $13.9 million or 11%.

Cost of revenue. Cost of revenue increased from $101.8 million for the nine months ended September 30, 2021 to $113.8 million for the nine months ended September 30, 2022, an increase of $12.0 million or 12%. The key drivers related to the cost of revenue increase were a $6.0 million increase in employee compensation and benefits, a $2.7 million in engineering consulting costs, a $2.4 million increase in all other costs and a $0.8 million increase in administrative allocations. The compensation cost increase was attributable to an increase of 21% in the average number of employees required to support our revenue growth.

Sales and marketing expenses. As a percentage of our revenue, sales and marketing expenses were 34% and 35% for the nine months ended September 30, 2022 and 2021, respectively. In dollar terms, sales and marketing expenses increased from $96.1 million for the nine months ended September 30, 2021 to $103.8 million for the nine months ended September 30, 2022, an increase of $7.8 million or 8%. This increase was primarily due to (i) an increase in employee compensation and benefits of $4.5 million, (ii) an increase in travel and entertainment costs of $2.5 million and (iii) an increase in administrative allocations and all other costs of $1.2 million. These increases were offset, in part, by a decrease in recruitment costs of $0.4 million. We will continue to accelerate our future revenue growth by investing in more resources.

General and administrative expenses. General and administrative expenses increased from $48.7 million for the nine months ended September 30, 2021 to $57.3 million for the nine months ended September 30, 2022, an increase of $8.5 million or 18%. This increase was comprised of several items, which included (i) increased costs in salaries, wages and benefits of $4.7 million as the average number of employees increased by 21%, (ii) an increase of our computer software and license costs of $2.4 million, (iii) an increase in travel and entertainment expenses of $1.4 million and (iv) an increase in contract labor and recruitment costs of $1.2 million for the nine months ended September 30, 2022. These unfavorable variances were offset, in part, by an increase in administrative allocations of $1.0 million.

Professional fees and other costs associated with litigation decreased from $14.1 million for the nine months ended September 30, 2021 to $12.8 million for the nine months ended September 30, 2022, a decrease of $1.3 million. This decrease was primarily due to timing of trial costs. During the nine months ended September 30, 2022, we have incurred costs related to the upcoming November 29, 2022 trial related to Rimini II. During the nine months ended September 30, 2021, we incurred costs related to the September 2021 hearing related to the contempt of the permanent injunction as well as discovery work on the Rimini II litigation.

Insurance costs and related recoveries, net increased from no activity for the nine months ended September 30, 2021 to a net benefit of $0.4 million for the nine months ended September 30, 2022. For the nine months ended September 30, 2022, we received insurance proceeds of $0.4 million related to our litigation costs incurred. We are self-insured for any costs related to any current or future intellectual property litigation. We currently believe our cash on hand, accounts receivable and contractually committed backlog provides us with sufficient liquidity to cover our ongoing attorneys’ fees and related costs, such as travel, hotels and consultants, associated with ongoing litigation, including Rimini II.

Interest expense. Interest expense increased from $0.7 million for the nine months ended September 30, 2021 to $3.0 million for the nine months ended September 30, 2022, an increase of $2.2 million. Interest expense increased primarily due to us entering into a five-year Credit Facility for $90 million on July 20, 2021 as well as increase in the LIBOR rate during the nine months ended September 30, 2022. In addition, we incurred $0.2 million of interest costs related to payments associated with our interest rate swap, which was entered into on May 18, 2022.

Other income (expenses), net. Other income (expenses), net is primarily comprised of interest income, foreign exchange gains and losses, and other non-operating income and expenses. For the nine months ended September 30, 2022, net other expenses of approximately $2.7 million was comprised primarily of foreign exchange losses of approximately $2.4 million. For the nine months ended September 30, 2022, we experienced a significant change in foreign currency exchange rates as the U.S. dollar strengthened against the majority of foreign currencies where our foreign entities operate. These transactions are designated in foreign currencies and impacted us unfavorably during the nine months ended September 30, 2022. For the nine months ended September 30, 2021, net other expense of $0.9 million, which was also comprised primarily of foreign exchange losses of approximately $0.7 million.

Income tax expense. We had income tax expense of $4.2 million for the nine months ended September 30, 2021 compared to $5.2 million for the nine months ended September 30, 2022. At the end of fiscal year 2021, we determined that it was more likely than not that we could benefit from our deferred tax assets based on all of the available evidence, resulting in a significant reduction in our valuation allowance. For the nine months ended September 30, 2022, our United States operations were subject to income taxes, which is the primary reason for the increase in income tax expense. For the nine months ended September 30, 2021, our income taxes were primarily attributable to income taxes on our foreign operations and foreign withholding taxes.

On July 20, 2021, we redeemed the remaining 87,802 shares of our Series A Preferred Stock at an aggregate total redemption price of $88.4 million. The total redemption price consisted of $87.8 million related to the outstanding shares of Series A Preferred Stock with a face value of $1,000 per share and $0.6 million or $6.86 per share of Series A Preferred Stock related to the dividends earned for the period from July 1, 2021 through July 19, 2021. The redeemed shares of the Series A Preferred Stock, along with the dividends, were recorded on the redemption date of July 20, 2021.

We funded the July 20, 2021 redemption with borrowings from our Credit Facility. The Credit Facility bears interest at LIBOR plus a margin ranging from 1.75% to 2.50% and contains certain financial covenants, including a minimum fixed charge coverage ratio, a total leverage ratio, and a minimum liquidity of at least $20 million in U.S. cash. Annual minimum principal payments over the five year term for the Credit Facility are 5%, 5%, 7.5%, 7.5%, and 10%, respectively, with the remaining balance due at the end of the term.

A key component of our business model requires that substantially all clients prepay us annually for the services we will provide over the following year or longer. As a result, we typically collect cash from our clients in advance of when the related service costs are incurred, which resulted in deferred revenue of $212.1 million that is included in current liabilities as of September 30, 2022. Therefore, we believe that working capital deficit is not as meaningful in evaluating our liquidity since the historical costs of fulfilling our commitments to provide services to clients are currently limited to approximately 39% of the related deferred revenue based on our gross profit percentage of 61% for the three months ended September 30, 2022.

equivalents and restricted cash of $119.0 million as of September 30, 2022, plus future cash flows from operating activities will be sufficient to meet our anticipated cash needs including working capital requirements, planned capital expenditures and our contractual obligations. Our future capital requirements depend on many factors, including any lingering impact of the COVID-19 pandemic, client growth, number of employees, expansion of sales and marketing activities, and the introduction of new and enhanced services offerings. We may also enter into arrangements to acquire or invest in complementary businesses, services, technologies, or intellectual property rights in the future. We may choose to seek additional debt or equity financing to support these long-term capital requirements. Alternatively, we may also consider reducing amounts outstanding under our Credit Facility to minimize our exposure to rising interest rates. If interest rates continue to increase as expected and adverse economic changes occur, we may not be able to access credit on terms favorable to us, impacting our ability to support these long-term capital requirements. In an economic downturn, we may also be unable to raise capital through debt or equity financings on terms acceptable to us or at all. Covenants in our Credit Facility could also have consequences on our operations, including restricting or delaying our ability to obtain additional financing, potentially limiting our ability to adjust to rapidly changing market conditions or respond to business opportunities. Additionally, in challenging and uncertain economic environments, we cannot predict when macroeconomic uncertainty may arise, whether or when such circumstances may improve or worsen or what impact such circumstances could have on our business and our liquidity requirements.

For the nine months ended September 30, 2022, we generated cash flows from our operating activities of approximately $36.8 million, which was derived from our cash earnings of approximately $18.5 million and by favorable changes in operating assets and liabilities of approximately $18.2 million. We believe that our operating cash flows for the year ending December 31, 2022 will be sufficient to fund the portion of our contractual obligations that is not funded with existing capital resources.

The effect of foreign currency translation was unfavorable by $11.1 million and $4.8 million for the nine months ended September 30, 2022 and 2021, respectively, due to unfavorable foreign exchange impacts related to foreign cash. For the nine months ended September 30, 2022, we experienced a significant change in foreign currency exchange rates as the U.S. dollar strengthened against the majority of foreign currencies where our foreign entities operate. The strengthening of the U.S. dollar reduced the reported amount of our foreign-denominated cash and cash equivalents which are translated into U.S. dollars and reported in our Unaudited Condensed Consolidated Financial Statements for the nine months ended and as of September 30, 2022.

A key component of our business model requires that clients typically prepay us annually for the services which we will provide over the following year or longer. As a result, we typically collect cash in advance of the date when the vast majority of the related services are provided. The key components in the calculation of our cash provided by operating activities, are as follows (in thousands):


	Nine Months Ended September 30,
	2022		2021
Net income	$	2,792	$	5,162
Non-cash expenses, net	15,719		17,114
Changes in operating assets and liabilities, net	18,246		25,538
Net cash provided by operating activities	$	36,757	$	47,814

For the nine months ended September 30, 2022, cash flows provided by operating activities amounted to approximately $36.8 million. The key drivers resulting in our cash provided by operating activities for the nine months ended September 30, 2022, included net income of $2.8 million, as adjusted for non-cash and non-operating expenses totaling $15.7 million and favorable changes in operating assets and liabilities of $18.2 million, resulting in net cash provided by operating activities of $36.8 million.

For the nine months ended September 30, 2022, the non-cash expenses, net consisted primarily of stock-based compensation expense of $8.7 million, amortization and accretion related to operating lease right of use ("ROU") assets of $4.1 million, depreciation and amortization expense of $1.9 million and accretion, amortization of debt discount and issuance costs of $0.7 million and deferred income taxes of $0.3 million. For the nine months ended September 30, 2022, the changes in operating assets and liabilities, net consisted of favorable changes to accounts receivable of $75.1 million and accounts payable of $2.7 million. These favorable cash sources were offset by unfavorable changes to deferred revenue of $46.9 million, prepaid expenses, deposits and other of $6.4 million, accrued liabilities of $3.8 million and deferred contract costs of $2.4 million.

For the nine months ended September 30, 2021, cash flows provided by operating activities amounted to approximately $47.8 million. The key drivers resulting in our cash provided by operating activities for the nine months ended September 30, 2021, included net income of $5.2 million, as adjusted for non-cash and non-operating expenses totaling $17.1 million and favorable changes in operating assets and liabilities of $25.5 million, resulting in net cash provided by operating activities of $47.8 million.

For the nine months ended September 30, 2021, the non-cash expenses, net consisted primarily of a loss on change in fair value of redeemable warrants of $3.0 million, stock-based compensation expense of $7.1 million, amortization and accretion related to operating lease ROU assets of $4.6 million, depreciation and amortization expense of $1.8 million, and an impairment charge related to operating lease ROU assets of $0.4 million. For the nine months ended September 30, 2021, the changes in operating assets and liabilities, net consisted of favorable changes to accounts receivable of $41.0 million and accounts payable of $5.6 million. These favorable cash sources were offset by unfavorable changes to deferred revenue of $11.1 million, prepaid expenses, deposits and other of $4.3 million, accrued liabilities of $3.9 million, and deferred contract costs of $1.8 million.

For the nine months ended September 30, 2021, cash utilized in financing activities of $26.0 million was attributable to payments to repurchase shares of Series A Preferred Stock totaling $156.8 million, which included $87.8 million in July 2021, $60.0 million in April 2021 and $9.0 million in January 2021; recurring dividend payments, totaling $9.7 million and make-whole dividend payments of $2.9 million; payments related to debt issuance costs of $4.0 million; payments for professional fees associated with our March 2021 Offering of $1.3 million; principal payment related to the Credit Facility of $1.1 million; payments of $1.1 million related to treasury stock and capital lease payments of $0.3 million. These cash uses were offset by

Our foreign subsidiaries and branches are dependent on our U.S.-based parent for continued funding. We currently do not intend to repatriate any amounts that have been invested overseas back to the U.S.-based parent. However, we may still be liable for withholding taxes, state taxes, or other income taxes that might be incurred upon the repatriation of foreign earnings. We have not made any provision for additional income taxes on undistributed earnings of our foreign subsidiaries. As of September 30, 2022, we had cash and cash equivalents of $49.6 million held by our foreign subsidiaries.

Our management’s discussion and analysis of financial condition and results of operations is based on our Unaudited Condensed Consolidated Financial Statements, which have been prepared in accordance with U.S. GAAP. The preparation of these Consolidated Financial Statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements, as well as the reported revenue and expenses during the reporting periods. These items are monitored and analyzed for changes in facts and circumstances, and material changes in these estimates could occur in the future. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Changes in estimates are reflected in reported results for the period in which they become known. Actual results may differ from these estimates under different assumptions or conditions. We describe our significant accounting policies in Note 2 to our Consolidated Financial Statements for the year ended December 31, 2021, included in Part II, Item 8 of our 2021 Form 10-K, and we discuss our critical accounting policies and estimates in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section included in Part II, Item 7 of our 2021 Form 10-K.

We have foreign currency risks related to our revenue and operating expenses denominated in currencies other than the U.S. Dollar, primarily the Euro, British Pound Sterling, Brazilian Real, Australian Dollar, Indian Rupee and Japanese Yen. For the three months ended September 30, 2022 and 2021, we generated approximately 48% and 47% of our revenue from our international business, respectively. Increases in the relative value of the U.S. Dollar to other currencies may negatively affect our revenue, partially offset by a positive impact to operating expenses in other currencies as expressed in U.S. Dollars. We have experienced and will continue to experience fluctuations in our net income (loss) as a result of transaction gains or losses related to revaluing certain current asset and current liability balances, including intercompany receivables and payables, which are denominated in currencies other than the functional currency of the entities in which they are recorded. While we have not engaged in the hedging of our foreign currency transactions to date, we are evaluating the costs and benefits of initiating such a program and we may in the future hedge selected significant transactions denominated in currencies other than the U.S. Dollar.

During the three months ended September 30, 2022, we did experience a significant change in foreign currency exchange rates applicable to our business that had a material impact on our Unaudited Condensed Consolidated Financial Statements due to the strengthening of the U.S. dollar against the majority of our foreign currencies. Our international operations have provided and are expected to continue to provide a portion of our consolidated revenues and expenses, which are reported in U.S. dollars in our Unaudited Condensed Consolidated Financial Statements. Therefore, our Unaudited

In July 2021, we entered into the Credit Facility, which bears interest at LIBOR plus a margin. ranging from 1.75% to 2.50%. Accordingly, we are exposed to market risk due to variable interest rates based on LIBOR. As of September 30, 2022, we had $79.4 million outstanding debt under the Credit Facility. As of this date, a hypothetical adverse change of 100 basis points in LIBOR would have resulted in an increase of approximately $0.8 million in annual interest expense. On May 18, 2022, we entered into an interest rate swap for a notional value of $40.0 million. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 as well as Note 5 and Note 12 to our Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Report for more information related to the Credit Facility.

We maintain a system of disclosure controls and procedures that are designed to reasonably ensure that information required to be disclosed in our SEC reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and to reasonably ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) (“Disclosure Controls”) will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. We monitor our Disclosure Controls and make modifications as necessary; our intent in this regard is that the Disclosure Controls will be modified as systems change and conditions warrant.

The legal proceedings described in Note 9 to our Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Report are incorporated herein by reference. In addition, from time to time, we may be a party to litigation and subject to claims incident to the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business. Regardless of the outcome, litigation can have an adverse impact on us because of judgment, defense and settlement costs, diversion of management resources and other factors.

Factors that could cause our actual results to differ materially from those in this Report are any of the risks described in this Item 1A. Any of these factors could result in a significant or material adverse effect on our business, financial condition, results of operations and cash flows. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. In addition, risk factors relating to economic uncertainties and downturns in the general economy or the industries in which our clients operate should be interpreted as heightened risks in the current macroeconomic global environment.

In January 2010, certain subsidiaries of Oracle Corporation (together with its subsidiaries individually and collectively, “Oracle”) filed a lawsuit, Oracle USA, Inc. et al v. Rimini Street, Inc. et al (United States District Court for the District of Nevada) (“District Court”), against us and our Chief Executive Officer, Seth Ravin, alleging that certain of our processes (Process 1.0) violated Oracle’s license agreements with its customers and that we committed acts of copyright infringement and violated other federal and state laws (“Rimini I”). The litigation involved our business processes and the manner in which we provided our services to our clients.

After completion of jury trial in 2015 and subsequent appeals, the final outcome of Rimini I was that Mr. Ravin was found not liable for any claims and we were found liable for only one claim: “innocent infringement,” a jury finding that we did not know and had no reason to know that our former support processes were infringing. The jury also found that the infringement did not cause Oracle to suffer lost profits. We were ordered to pay a judgment of $124.4 million in 2016, which we promptly paid and then pursued appeals. With interest, attorneys’ fees and costs, the total judgment paid by us to Oracle after the completion of all appeals was approximately $89.9 million. A portion of such judgment was paid by our insurance carriers (for additional information on this topic, see Note 9 to our Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Report).

In the order, the District Court ruled in favor of us with respect to five out of ten items. With respect to the other five items, the District Court found that we violated the permanent injunction, awarded sanctions to Oracle of $0.6 million and ordered that certain computer files be quarantined from use and notice and proof of such quarantining be provided to Oracle. The District Court also ruled that Oracle may recover its reasonable attorneys’ fees and costs. We reserve all rights, including appellate rights, with respect to the District Court rulings and findings.

On February 7, 2022, we filed a notice of appeal in the District Court, commencing an appeal of the District Court’s January 12, 2022 decision to the Ninth Circuit Court of Appeals (“Court of Appeals”). On February 8, 2022, the District Court stayed the briefing on Oracle’s bill of attorneys’ fees and costs until our appeal is resolved. Briefing on our appeal has been completed, and the parties are currently working with the Court of Appeals to schedule oral argument on the appeal in early 2023. At this time, we believe that we are substantial compliance with the injunction and have complied with the order regarding the quarantining of certain computer files. As of September 30, 2022, we have accrued $6.9 million for an estimate related to reasonable attorneys’ fees and costs. Regarding our estimate for reasonable attorneys’ fees and costs, significant judgment is required to determine the amount of loss related to this matter as the outcome is inherently unpredictable and subject to uncertainties.

Oracle may file additional contempt motions against us at any time to attempt to enforce its interpretation of the injunction or if it has reason to believe we are not in compliance with the express terms of the injunction. Such contempt proceedings or any judicial finding of contempt could result in a material adverse effect on our business and financial condition. In addition, the pendency of the injunction, alone, or the District Court’s January 12, 2022 order, could dissuade clients from purchasing or continuing to purchase our services. If we are obligated to pay substantial civil assessments arising from any finding of contempt, this could reduce the amount of cash flows available to pay principal, interest, fees and other amounts due under our Credit Facility, which could result in an event of default, in which case the lenders could demand accelerated payment of principal, accrued and unpaid interest, and other fees. We cannot assure you that we will have sufficient assets which would allow us to repay such indebtedness in full at such time. As a result, we could be forced into bankruptcy or liquidation.

In October 2014, we filed a separate lawsuit, Rimini Street Inc. v. Oracle Int’l Corp., in the District Court against Oracle seeking a declaratory judgment that our support practices, in use since at least July 2014, do not infringe certain Oracle copyrights (“Rimini II”). Our operative complaint asserts declaratory judgment, tort, and statutory claims. Oracle’s operative counterclaim asserts declaratory judgment and copyright infringement claims and Lanham Act, breach of contract, and business tort violations.

On September 15, 2020, the District Court issued an order resolving the parties’ motions for summary judgment. It found infringement of 17 Oracle PeopleSoft copyrights for work we performed for a discrete set of “gap customers” that were supported by processes litigated in Rimini I, and that became our customers after Rimini I was filed. The District Court also found infringement of four Oracle PeopleSoft copyrights involving support of two specific clients, described by the District Court as “limited cases” and involving “limited circumstance[s].” There was no finding of infringement on any other Oracle copyrights at issue.

During a status conference with the District Court on October 14, 2022, attorneys for Oracle confirmed that Oracle would withdraw all of its monetary damages claims against us in Rimini II and proceed with a bench trial instead of a jury trial for its claims for equitable relief. Further, in accordance with a Minute Order issued by the District Court on October 14, 2022, good cause appearing, the start date for the Rimini II trial was changed from November 2, 2022 to November 29, 2022 in Las Vegas.

As ordered by the District Court, on October 21, 2022, the parties filed a stipulation to dismiss with prejudice the Rimini II claims affected by Oracle’s decision, including all of Oracle’s monetary damages claims against us and Mr. Ravin. On October 24, 2022, the District Court entered an order granting the Stipulation, dismissing with prejudice Oracle’s claims in Rimini II “for monetary relief of any kind under any legal theory [,] including but not limited to claims for damages, restitution, unjust enrichment, and engorgement [ . . . ].” In addition, Oracle’s claims for breach of contract, inducing breach of contract and an accounting were dismissed with prejudice. Per the Stipulation, the parties have each reserved the right to seek attorneys’ fees and/or costs to the extent permissible by law.

We could be required to pay substantial attorneys’ fees and/or costs in connection with litigation relating to our current or past business activities and/or be enjoined from certain business practices. Any of these outcomes could result in a material adverse effect on our business and financial condition, and the pendency of the litigation alone could dissuade clients from purchasing or continuing to purchase our services. If we are obligated to pay substantial attorneys’ fees and/or costs to Oracle or are enjoined from certain business practices, this could reduce the amount of cash flows available to pay principal, interest, fees and other amounts due under our Credit Facility, which could result in an event of default, in which case the lenders could demand accelerated payment of principal, accrued and unpaid interest, and other fees. If we default in our payment obligations under the Credit Facility and the indebtedness under the Credit Facility were to be accelerated, there can be no assurance that our assets would be sufficient to repay such indebtedness in full, and we could be forced into bankruptcy or liquidation.

Our business has been and may continue to be materially harmed by this litigation and Oracle’s conduct. During the course of these cases, we anticipate there will be rulings by the District Court in Rimini II, the District Court in the contempt proceedings, and the Court of Appeals in both the contempt proceedings and in Rimini II in connection with hearings, motions, decisions, and other matters, as well as other interim developments related to the litigations. If securities analysts or investors regard these rulings as negative, the market price of our Common Stock may decline. If current or prospective clients regard these rulings as negative, it could negatively impact our new client sales or renewal sales.

In Rimini II, Oracle filed counterclaims relating to our support services for Oracle’s PeopleSoft, J.D. Edwards, Siebel, E-Business Suite, and Database software products. For the nine months ended September 30, 2022, approximately 63% of our revenue was derived from the support services that we provide for our clients using Oracle’s PeopleSoft, J.D. Edwards, Siebel, E-Business Suite and Database software products. The percentage of revenue derived from services we provide for PeopleSoft software only was approximately 9% of our total revenue during this same period. Although we provide support services for additional Oracle product lines that are not subject to litigation and support services for software products provided by companies other than Oracle, our current revenue depends significantly on the product lines that are the subject of the Rimini II litigation. Should Oracle prevail on its claims in Rimini II or should a contempt proceeding result in a final order holding us in contempt, we could be required to change the way we provide support services to some of our clients, which could result in the loss of clients and revenue, and may also give rise to claims for compensation from our clients, any of which could have a material adverse effect on our business, financial condition and results of operations.

We have experienced challenges growing our business as a result of our ongoing litigation with Oracle. Many of our existing and prospective clients have expressed concerns regarding our ongoing litigation and, in some cases, have been subjected to various negative communications by Oracle in connection with the litigation. We have experienced in the past, and may continue to experience in the future, volatility and slowness in acquiring new clients, as well as clients not renewing their agreements with us, due to these challenges relating to our ongoing litigation with Oracle. Further, certain of our prospective and existing clients may be subject to additional negative communications from software vendors. We have taken steps to minimize disruptions to our existing and prospective clients regarding the litigation, but we continue to face challenges growing our business while the litigation remains ongoing. In certain cases, we have agreed to pay certain liquidated damages to our clients if we are no longer able to provide services to these clients, and/or reimburse our clients and our former lenders for their reasonable legal fees incurred in connection with any litigation-related subpoenas and depositions or to provide certain client indemnification or termination rights if any outcome of litigation results in our inability to continue providing any of the paid-for services. In addition, we believe the length of our sales cycle is longer than it otherwise would be due to prospective client diligence on possible effects of the Oracle litigation on our business. We cannot assure you that we will continue to overcome the challenges we face as a result of the litigation and continue to renew existing clients or secure new clients.

We are self-insured for any costs related to any current or future intellectual property litigation, although we maintain and have tendered our errors and omissions insurance coverage for the wrongful acts alleged in Oracle’s contempt proceeding in order to seek determinations of a duty to defend. We obtained a determination of a duty to defend with respect to our primary errors and omission insurance carrier and have sought a determination of a duty to defend by our excess errors and omissions insurance carriers. We cannot provide assurances that we will prevail on this claim or any other similar claims that we may tender in the future.

Oracle has been active in litigating against companies that have offered competing maintenance and support services for their products. For example, in March 2007, Oracle filed a lawsuit against SAP and its wholly-owned subsidiary, TomorrowNow, Inc. After a jury verdict awarding Oracle $1.3 billion, the parties stipulated to a final judgment of $306 million subject to appeal. After the appeal, the parties settled the case in November 2014 for $356.7 million. In February 2012, Oracle filed suit against ServiceKey, Inc. and settled the case in October 2013 after the District Court issued an injunction against ServiceKey and its CEO. Oracle also filed suit against CedarCrestone Corporation in September 2012 and settled the case in July 2013. TomorrowNow and CedarCrestone offered maintenance and support for Oracle software products, and Service Key offered maintenance and support for Oracle technology products. Given Oracle’s history of litigation against companies offering alternative support programs for Oracle products, we can provide no assurance, regardless of the outcome of our

At the beginning of the COVID-19 pandemic, we established work-at-home arrangements for most of our employees, placed restrictions on non-essential business travel and implemented a no in-person event marketing strategy and a partially remote sales model. While we now permit some travel and in-person marketing, sales and employee appreciation events in accordance with applicable regional guidance, we believe that many of our clients are continuing to maintain or partially maintain selected COVID-19-related precautionary measures and will continue to do so. These precautionary measures could impact our clients’ and potential clients’ ability or willingness to participate in our sales, marketing and client success efforts, which could adversely affect our business, financial condition and results of operations. Further, there is still some remaining uncertainty around any lingering impacts of the pandemic on the global economy and consumer confidence. While some of our offices have re-opened to verified vaccinated employees and guests, our offices will not fully re-open until local authorities permit us to, and our own criteria and conditions to ensure employee health and safety are satisfied. The COVID-19 pandemic could have a sustained adverse impact on economic and market conditions, which may delay prospective clients’ decisions regarding engaging our services, impair the ability of our current clients to make timely payments to us, cause our current clients to ask for payment concessions or discounts, impact client renewal rates and adversely affect our revenue. If such conditions occur, we may be required to increase our reserves, allowances for doubtful accounts and write-offs of accounts receivable, and our results of operations would be harmed.

We are unable to accurately predict any future impact of the COVID-19 pandemic due to various uncertainties, including the duration and scope of new variants and surges, particularly if virus variants result in additional outbreaks, and actions that may be taken by governmental authorities to contain the virus in the future. We closely monitor any remaining impact of the COVID-19 pandemic, continually assessing its potential effects on our business. The extent to which our results may be affected will largely depend on future developments which cannot be accurately predicted and are uncertain, but any lingering impacts of the COVID-19 pandemic or the perception of its effects could have a material adverse effect on our business, financial condition, results of operations, or cash flows. Further, due to our subscription-based business model, the effect of the pandemic may not be fully reflected in our results of operations until future periods, and any global macroeconomic effects of the pandemic may persist for an indefinite period. The COVID-19 pandemic may also have the effect of heightening many of the other risks described in this “Risk Factors” section. Refer to the section titled “Impact of the COVID-19 Pandemic and Current Economic Conditions” under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 of this Report for additional information.

General worldwide economic conditions have experienced significant fluctuations in recent years, and market volatility and uncertainty remain widespread, with the expectation that inflation (including hyperinflation), other economic challenges and possible recession will be exacerbated for an extended period. Inflation has accelerated in the U.S. and globally due in part to global supply chain issues, a rise in energy prices, fiscal and monetary policy adopted during the COVID-19 pandemic and continued strong consumer demand as economies reopen from restrictions related to the pandemic. An inflationary environment may increase our and our clients’ cost of labor due to higher wages, as well as result in higher financing costs and/or higher supplier prices for both us and our clients. As a result, we and our clients find it extremely difficult to accurately forecast and plan future business activities. In addition, these conditions could cause our clients or prospective clients to reduce their IT budgets, which could decrease corporate spending on our products and services, resulting in delayed and lengthened sales cycles, a decrease in new client acquisition and loss of clients. Furthermore, during challenging economic times, our clients may face issues with their cash flows and in gaining timely access to sufficient credit or obtaining credit on reasonable terms, which could impair their ability to make timely payments to us, impact client renewal rates and adversely affect our revenue. If such conditions occur, we may be required to increase our reserves, allowances for doubtful accounts and write-offs of accounts receivable, and our results of operations would be harmed. We cannot predict the timing, strength or duration of any economic slowdown or recovery, whether global, regional or within specific markets. If the

conditions of the general economy or markets in which we operate worsen, our business could be harmed. In addition, even if the overall economy improves, the market for our products and services may not experience growth. Moreover, multiple events, including Brexit, changes in U.S. trade policies and responsive changes in policy by foreign jurisdictions, governmental and multinational organizations’ responses to the COVID-19 pandemic and geopolitical developments and uncertainty in the European Union and elsewhere, such as the current conflict between Russia and Ukraine, have increased levels of political and economic unpredictability globally, and may increase the volatility of global financial markets and the global and regional economies.

The market for independent enterprise software support services is still relatively undeveloped, has not yet achieved widespread acceptance and may not grow quickly or at all. Our success will depend to a substantial extent on the willingness of companies to engage a third party such as us to provide software support services for their enterprise software. Many enterprise software licensees remain hesitant to use a third party to provide such support services, choosing instead to rely on support services provided by the enterprise software vendor. Other enterprise software licensees have invested substantial personnel, infrastructure and financial resources in their own organizations with respect to support of their licensed enterprise software products and may choose to self-support with their own internal resources instead of purchasing services from the enterprise software vendor or an independent provider such as ourselves. Particularly because our market is relatively undeveloped, we must address any potential clients’ concerns and explain the benefits of our approach to convince them of the value of our services. If companies are not sufficiently convinced that we can address their concerns and that the benefits of our services are compelling, then the market for our services may not develop as we anticipate, and our business will not grow.

Our current and potential competitors may have significantly more financial, technical, sales and marketing teams and other resources than we have, may be able to devote greater resources to the development, promotion, sale and support of their products and services, have more extensive customer bases and broader customer relationships than we have and may have longer operating histories and greater name recognition than we have. We face intense competition from enterprise software vendors, such as Oracle and SAP, who provide software support services for their own products. Enterprise software vendors have offered, and may continue to offer, discounts to companies to whom we have marketed our services. In addition, enterprise software vendors may take other actions in an attempt to maintain their support service business, including changing the terms of their customer agreements, the functionality of their products or services, or their pricing terms. For example, starting in the second quarter of 2017 Oracle has prohibited us from accessing its support websites to download software updates on behalf of our clients who are authorized to do so and permitted to authorize a third party to do so on their behalf. In addition, various support policies of Oracle and SAP may include clauses that could penalize customers that choose to use independent enterprise software support vendors or that, following a departure from the software vendor’s support program, seek to return to the software vendor to purchase new licenses or services. Further, our current and potential competitors and enterprise software vendors may develop and market new technologies that render our existing or future services less competitive or obsolete. Competition could significantly impede our ability to sell our services on terms favorable to us, and we may need to decrease the prices for our services to remain competitive. If we are unable to maintain our current pricing due to competitive pressures, our margins will be reduced and our results of operations will be negatively affected.

There are also several smaller vendors in the independent enterprise software support services market with whom we compete with respect to certain of our services. We expect competition to continue to increase in the future, particularly if we prevail in Rimini II, which could harm our ability to increase sales, maintain or increase renewals and maintain our prices. In addition, certain independent enterprise software support organizations may have or may develop more cooperative relationships with enterprise software vendors, which may allow them to compete more effectively than us over the long term. To the extent any of our competitors have existing relationships with potential clients for enterprise software products and support services, those potential clients may be unwilling to purchase our services because of those existing relationships, which could cause the demand for our services to be substantially impacted. Further, our competitors may attempt to use the pendency of the injunction, or the January 12, 2022 District Court order relating to the injunction described above under the section titled “Risks Related to Litigation,” to dissuade certain of our prospective or existing clients from purchasing or continuing to purchase our services.

We recorded a net loss of $0.4 million for the three months ended September 30, 2022, and we had an accumulated deficit of $223.0 million as of September 30, 2022. We will need to generate and sustain increased revenue levels in future periods while managing our costs to be profitable, and, even if we do, we may not be able to maintain or increase our level of profitability. To increase our revenue, we must add new clients, secure renewals or service extensions by existing clients on terms favorable to us and sell additional products and services to existing clients. As competitors introduce low-cost and/or differentiated services that are perceived to compete with ours, or as enterprise software vendors introduce competitive pricing or additional products and services or implement other sales strategies to compete with us, our ability to sell to new clients and renew agreements with existing clients based on pricing, service levels, technology and functionality could be impaired. In addition, certain of our existing clients may choose to license a new or different version of enterprise software from an enterprise software vendor, and such clients’ license agreements with the enterprise software vendor will typically include a minimum one-year mandatory maintenance and support services agreement. In such cases, it is unlikely that these clients would renew their maintenance and support services agreements with us, at least during the early term of the license agreement. In addition, such existing clients could move to another enterprise software vendor, product or release for which we do not offer any products or services. As a result, we may be unable to renew or extend our agreements with existing clients or attract new clients or new business from existing clients on terms that would be favorable or comparable to prior periods, which could have an adverse effect on our revenue and growth.

Additionally, we intend to continue to expend significant funds to expand our sales and marketing operations, enhance our service offerings, expand into new markets, launch new product offerings and meet the increased compliance requirements associated with our operations as a public company. Our efforts to grow our business may be costlier than we expect, and we may not be able to increase our revenue enough to offset our higher operating expenses. Further, many companies with which we compete have larger and longer-tenured sales and marketing teams, which may impact the ability to grow our business, which could have an adverse effect on our revenue and growth. If we are unable to achieve and sustain revenue growth or profitability, the market price of our securities may significantly decrease.

Our clients have no obligation to renew their product or service subscription agreements with us after the expiration of a non-cancelable agreement term. In addition, the majority of our multi-year, non-cancelable client agreements are not pre-paid other than the first year of the non-cancelable service period. We may not accurately predict retention rates for our clients. Our retention rates may decline or fluctuate as a result of a number of factors, including our clients’ decision to license a new product or release from an enterprise software vendor, our clients’ decision to move to another enterprise software vendor, product or release for which we do not offer products or services, any remaining impact of the COVID-19 pandemic and global economic conditions, including rising inflation and interest rates, on our clients’ businesses, client satisfaction with our products and services, the acquisition of our clients by other companies, and clients going out of business. If our clients do not renew their agreements for our products and services or if our clients decrease the amount they spend with us, our revenue will decline and our business will suffer. In addition, certain of our existing clients may choose to license a new or different version of enterprise software from an enterprise software vendor, and such clients’ license agreements with the enterprise software vendor will typically include a minimum one-year mandatory maintenance and support services agreement. In such cases, it is unlikely that these clients would renew their maintenance and support services agreements with us, at least during the early term of the license agreement. In addition, such existing clients could move to another enterprise software vendor, product or release for which we do not offer any products or services.

As a subscription-based business, we recognize revenue over the service period of our contracts. As a result, much of our reported revenue each quarter results from contracts entered into during previous quarters. Consequently, while a shortfall in demand for our products and services or a decline in new or renewed contracts in any one quarter may not significantly reduce our revenue for that quarter, it could negatively affect our revenue in future quarters and full year periods. Accordingly, the effect of significant downturns in new sales, renewals or extensions of our service agreements for a quarter will not be reflected in full in our results of operations until future periods. Our revenue recognition model also makes it difficult for us to rapidly increase our revenue through additional sales in any period, as revenue from new clients must be recognized over the applicable service contract term.

We do not have a long operating history upon which to base forecasts of future operating revenue. In addition, the variability of the sales cycle for the evaluation and implementation of our products and services, which typically has been six to twelve months once a client is engaged, may also cause us to experience a delay between increasing operating expenses for such sales efforts, and the generation of corresponding revenue. Accordingly, we may be unable to prepare accurate internal financial forecasts or replace anticipated revenue that we do not receive as a result of delays arising from these factors. As a result, our results of operations and liquidity in future reporting periods may be significantly below the expectations of the public market, securities analysts or investors, which could negatively impact the price of our Common Stock.

Due to the collection of cash from our clients before services are provided, our revenue is recognized over future periods when there are no corresponding cash receipts from such clients. Accordingly, our future liquidity depends upon the ability to continue to attract new clients and to enter into renewal arrangements with existing clients. If we experience a decline in orders from new clients or renewals from existing clients, our revenue may continue to increase while our liquidity and cash levels decline. Any such decline, however, will negatively affect our revenues in future quarters. Accordingly, the effect of declines in orders from new clients or renewals from existing clients may not be fully reflected in our results of operations and cash flows until future periods. Comparing our revenues and operating results on a period-to-period basis may not be meaningful, as it may not be an indicator of the future sufficiency of our cash and cash equivalents to meet our liquidity requirements. You should not rely on our past results as an indication of our future performance or liquidity.

In addition, our historical rapid growth has placed and may continue to place significant demands on our management and our operational and financial resources. Our organizational structure is becoming more complex as we add additional staff, and we will need to improve our operational, financial and management controls, as well as our reporting systems and procedures. Further, we believe that our corporate culture has been a critical component of our success. We have invested substantial time and resources in building our team and nurturing our culture. As we expand our business and operate as a public company, we may find it difficult to maintain our corporate culture while managing our employee growth. We will require significant capital expenditures and the allocation of valuable management resources to grow and change in these areas without undermining our corporate culture of rapid innovation, teamwork and attention to client service that has been central to our growth. Any failure to manage our anticipated growth and related organizational changes in a manner that preserves our culture could negatively impact future growth and achievement of our business objectives.

We may need to raise additional debt under our Credit Facility and additional capital beyond those available under the Credit Facility and funds raised from our August 2020 Offering and our March 2021 Offering if we cannot fund our growth or service our debt through our operating cash flows. Should this occur, we may not be able to obtain additional debt or additional equity financing on favorable terms, if at all, which could harm our business, results of operations and financial condition. We are also subject to certain restrictions for future financings as discussed in the risk factor “The terms of our Credit Facility impose operating and financial restrictions on us.” If we raise additional equity financing, our stockholders may experience significant dilution of their ownership interests and the value of our Common Stock could decline. If we engage in additional debt financings, the holders of the debt securities or lenders would have priority over the holders of our Common Stock. We may also be required to accept terms that further restrict our ability to incur additional indebtedness, take other actions that would adversely impact the short-term price of our Common Stock, or force us to maintain specified liquidity or other ratios, any of which could harm our business, results of operations and financial condition and reduce the value of our Common Stock.

The software industry is characterized by the existence of a large number of patents, copyrights, trademarks, trade secrets and other intellectual and proprietary rights. Companies in the software industry are often required to defend against claims and litigation alleging infringement or other violations of intellectual property rights. Many of our competitors and other industry participants have been issued patents and/or have filed patent applications and may assert patent or other intellectual property rights within the industry. Our ongoing litigation with Oracle relates in part to copyright infringement claims and, from time to time, we may receive threatening letters or notices alleging infringement or may be the subject of claims that our services and underlying technology infringe or violate the intellectual property rights of others. Any allegation of infringement, whether innocent or intentional, can adversely impact marketing, sales and our reputation.

The loss of our Chief Executive Officer or any of our key senior members of management could have a material adverse effect on our business, operating results and financial condition, particularly if we are unable to hire and integrate suitable replacements on a timely basis. Mr. Ravin has been under long-standing medical care for kidney disease, which includes ongoing treatment. Although Mr. Ravin’s condition has not adversely impacted his performance as Chief Executive Officer or on the overall management of the Company, we can provide no assurance that his condition will not affect his ability to perform the role of Chief Executive Officer in the future. Further, as we continue to grow our business, we will continue to adjust our senior management team. If we are unable to attract or retain the right individuals for the team, it could hinder our ability to grow our business and could disrupt our operations or otherwise have a material adverse effect on our business. We do not maintain key man life insurance on any of our employees.

Furthermore, to execute our business strategy, we must attract and retain highly qualified personnel, including sales personnel. Our ability to increase our client base and achieve broader market acceptance of our services will depend to a significant extent on our ability to expand our marketing and sales operations. We plan to continue expanding our sales force globally. We are experiencing a very competitive recruiting environment, creating difficulty in hiring and retaining sufficient numbers of highly skilled sales personnel and other employees with appropriate qualifications. In particular, we have experienced extreme hiring competition in the San Francisco Bay Area, where we have a significant amount of operations, but also face extremely competitive hiring environments across the United States and the other countries in which we operate. Our efforts to attract, develop, integrate and retain highly skilled employees with appropriate qualifications may be compounded by intensified restrictions on travel (including restrictions implemented during a pandemic or similar circumstance), immigration, or the availability of work visas. Many companies with which we compete for experienced personnel have greater resources and less stock price volatility than we do. In making employment decisions, job candidates often consider the value of the equity incentives they are to receive in connection with their employment. If the price of our stock continues to experience significant volatility, our ability to attract or retain qualified employees will be adversely affected. In addition, as we continue to expand into new geographic markets, there can be no assurance that we will be able to attract and retain the required management, sales, marketing and support services personnel to profitably grow our business. If we fail to attract highly qualified new sales and other personnel or fail to retain and motivate our current personnel, our growth prospects could be severely harmed.

Moreover, our sales personnel typically take an average of between nine to twelve months before any new sales personnel can operate at the capacity typically expected of experienced sales personnel. This ramp cycle, combined with our typical six- to twelve-month sales cycle for engaged prospects, means that we will not immediately recognize a return on this investment in our sales results. In addition, the cost to acquire clients is high due to the cost of these marketing and sales efforts. Further, the cost of marketing and sales efforts will likely increase as we continue to offer new products and services, as even our experienced sales personnel will need to receive specialized training on our new offerings. Our business may be materially harmed if our efforts do not generate a corresponding increase in revenue. We may not achieve anticipated revenue growth from expanding our sales force if we are unable to hire, develop and retain talented sales personnel, if our new sales personnel are unable to achieve desired productivity levels in a reasonable period of time or if our sales and marketing programs are not effective.

Any interruptions or delays in our service, whether as a result of third-party error, our own error, natural disasters or other catastrophic events, security breaches or a result of any other issues, whether accidental or willful, could harm our relationships with clients and cause our revenue to decrease and our expenses to increase. Also, in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur. These factors, in turn, could further reduce our revenue, subject us to liability, cause us to pay liquidated damages, issue credits or cause clients not to renew their agreements with us, any of which could materially adversely affect our business.

We depend and rely on software-as-a-service, or SaaS, technologies and related services from third parties in order to operate critical functions of our business, including billing and order management, financial accounting services, and customer relationship management services. If these services become unavailable due to extended outages or interruptions, security vulnerabilities, or cyber-attacks, because they are no longer available on commercially reasonable terms or prices, or due to other unforeseen circumstances, our expenses could increase, our ability to manage these critical functions could be interrupted, and our processes for and ability to manage sales of our products, recognize revenue, and support our customers could be impaired, all of which could adversely affect our business and operating results.

Our results of operations have fluctuated in the past and are expected to fluctuate in the future due to a variety of factors, many of which are outside of our control, including seasonality linked to certain of the sales cycles for our products and services. Historically, our sales cycle has been tied to the renewal dates for our clients’ existing and prior vendor support agreements for the products that we support. Because our clients make support vendor selection decisions in conjunction with the renewal of their existing support agreements with Oracle and SAP, among other enterprise software vendors, we have experienced an increase in business activity during the quarterly periods in which those agreements are up for renewal. However, because we have introduced and intend to continue to introduce products and services for additional software products that do not follow the same renewal timeline or pattern, our past results may not be indicative of our future performance, and comparing our results of operations on a period-to-period basis may not be meaningful. Also, if we are unable to engage a potential client before its renewal date for software support services in a particular year, it will likely be at least another year before we would have the opportunity to engage that potential client again, given that such potential client likely

We currently offer our clients support services for a fee that is equal to a percentage of the annual fees charged by the enterprise software vendor; therefore, changes in such vendors’ fee structures would impact the fees we would receive from our clients. If the enterprise software vendors offer deep discounts on certain services or lower prices generally, we may need to change our pricing models, which could have an adverse effect on our results of operations. In addition, we continue to add new products and services to our offerings. To the extent that we do not have substantial experience with pricing such new products and services, we may need to adjust our pricing models for these offerings over time to ensure that we remain competitive and realize a return on our investment in developing these new products and services. If we do not adapt our pricing models as necessary or appropriate, our revenue could decrease and adversely affect our results of operations.

As enterprise software products become more advanced and complex, we will need to devote additional resources to innovating, improving and expanding our offerings to provide relevant products and services to our clients using these more advanced and complex products. In addition, we will need to appropriately scale our internal business systems and our global operations and client engagement teams to serve our growing client base, particularly as our client demographics expand over time. Any such expansion may be expensive and complex, requiring financial investments, management time and attention. Any failure of or delay in these efforts could adversely affect the quality or success of our services and negatively impact client satisfaction, resulting in potential decreased sales to new clients and possibly lower renewal rates by existing clients.

A significant component of our growth strategy involves the further expansion of our operations and client base outside the United States. Accordingly, our international revenue grew from $45.2 million for the three months ended September 30, 2021 to $48.5 million for the three months ended September 30, 2022, an increase of $3.3 million or 7%. We currently have subsidiaries outside of the United States in Australia, Brazil, Canada, UAE (Dubai), France, Germany, Hong Kong, India, Israel, Japan, Korea, Malaysia, Mexico, Netherlands, New Zealand, Poland, Singapore, Sweden, Taiwan and the United Kingdom, which focus primarily on selling our services in those regions.

Our current revenue is primarily derived from the provision of support services for Oracle and SAP enterprise software products. If other enterprise software vendors, products and releases emerge to take substantial market share from current Oracle and SAP products and releases we support, and we are unable to, or do not, offer products or services for such vendors, products or releases, demand for our products and services may decline or our products and services may become obsolete. Developing new products and services to address different emerging enterprise software vendors, products and releases could take a substantial investment of time and financial resources, and we cannot guarantee that we will be successful. If fewer clients use enterprise software products for which we provide products and services, and we are not able to provide services for new vendors, products and releases, our business may be adversely impacted.

We continue to invest resources in research and development to enhance our current product and service offerings, and other new offerings that will appeal to clients and potential clients, for example, our partnership with Salesforce to support SaaS solutions and our Application Management Services (AMS) for SAP and Oracle products. The development of new product and service offerings may not generate sufficient revenue to offset the increased research and development expenses and may not generate gross profit margins consistent with our current margins. Also, our new product and service offerings may be in markets that are more competitive than markets for our existing product and service offerings, making it more difficult to introduce them to clients and potential clients effectively or provide them profitably.

Our services sometimes involve accessing, processing, sharing, using, storing and transmitting proprietary information and protected data of our clients. We rely on proprietary and commercially available systems, software, tools and monitoring, as well as other processes, to provide security for accessing, processing, sharing, using, storing and transmitting such information and data. If our security measures are compromised as a result of third-party action, employee, vendor or client error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could be damaged, our business and our clients may be harmed, and we could incur significant liabilities. Cyberattacks continue to increase in frequency and in magnitude generally, and these threats are being driven by a variety of sources, including nation-state sponsored espionage and hacking activities, industrial espionage, organized crime, sophisticated organizations and hacking groups and individuals. Furthermore, due to geopolitical tensions related to the current conflict between Russia and Ukraine, the risk of cyber-attacks may be elevated. We have been the subject of cybersecurity threats and expect such threats to continue in the future. In addition, if the security measures of our clients are compromised, even without any actual compromise of our own systems or security measures, we may face negative publicity or reputational harm if our clients or anyone else incorrectly attributes the blame for such security breaches to us, our products and services, or our systems. We may also be responsible for repairing any damage caused to our clients’ systems that we support, and we may not be able to make such repairs in a timely manner or at all.

We may be unable to anticipate or prevent techniques used to obtain unauthorized access or to sabotage systems because they change frequently and generally are not detected until after an incident has occurred. As we increase our client base and our brand becomes more widely known and recognized, we may become more of a target for third parties seeking to compromise our systems or security measures or gain unauthorized access to our clients’ proprietary information and protected data as was the case in a 2021 successful phishing incident where we were a victim, which resulted in some unauthorized sharing of client addresses and outstanding billing data information, but did not significantly impact our business or client relationships.

Although we attempt to mitigate these risks by employing a number of measures, including insurance, monitoring of our systems and networks, employee training and maintenance of backup and protective systems, our systems, networks, products and services remain potentially vulnerable to increasingly sophisticated advanced persistent threats that may have a material effect on our business. In addition, the devotion of additional resources to the security of our information technology systems in the future could significantly increase the cost of doing business or otherwise adversely impact our financial results.

In addition, many governments have enacted laws requiring companies to notify individuals of data security incidents involving certain types of personal data, and some of our clients contractually require notification of any data security compromise. In the event of a data security compromise, we may have difficulty timely complying with notification requirements that are unreasonably short or burdensome. Security compromises experienced by our clients, by our competitors or by us may lead to public disclosures, which may lead to widespread negative publicity. Any data security compromise in our industry, whether actual or perceived, could harm our reputation, erode client confidence in the effectiveness of our security measures, negatively impact our ability to attract new clients, cause existing clients to elect not to renew their agreements with us, or subject us to third party lawsuits, government investigations, regulatory fines or other action or liability, all or any of which could materially and adversely affect our business, financial condition and results of operations.

We cannot assure you that any limitations of liability provisions in our contracts for a security breach would be enforceable or adequate or would otherwise protect us from any such liabilities or damages with respect to any particular claim. We also cannot be sure that our existing general liability insurance coverage and coverage for errors or omissions will continue to be available on acceptable terms or will be available in sufficient amounts to cover one or more claims, or that the insurer will not deny coverage as to any future claim. The successful assertion of one or more claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of substantial deductible or co-insurance requirements, could have a material adverse effect on our business, financial condition and results of operations.

As an expanding global company, we are subject to the laws and regulations of numerous jurisdictions worldwide regarding accessing, processing, sharing, using, storing, transmitting, disclosure and protection of personal data, the scope of which are constantly changing, subject to differing interpretation and related to jurisdictions where we have operations, customers, or where we conduct marketing, and such laws may be inconsistent between countries or in conflict with other laws, legal obligations or industry standards. For example, the General Data Protection Regulation (“GDPR”) in the European Union (“EU”), creates a broad range of requirements and imposes substantial penalties for non-compliance, including possible fines of up to 4% of global annual revenue for the preceding financial year or €20 million (whichever is higher) for the most serious infringements. We are also subject to certain requirements in other international jurisdictions with or developing strong privacy legislation, as well as expanding U.S. state law, including the California Consumer Privacy Act of 2018, the California Privacy Rights Act of 2020, the Virginia Consumer Data Protection Act of 2021 (effective Jan 1, 2023), the Colorado Consumer Privacy Act of 2021 (effective July 1, 2023), as well as privacy legislation in other states, including Nevada, each of which add to the range of privacy-related compliance requirements. We generally comply with industry standards and strive to comply with all applicable legal obligations relating to privacy and data protection, but it is possible that these laws and other legal obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with industry standards or our practices or may be mandated at a pace that exceeds our ability to comply. Compliance with such requirements may be costly and may require us to modify our business practices, which could adversely affect our business and profitability. Any failure or perceived failure by us to comply with these laws, policies or other obligations may result in governmental enforcement actions or litigation against us, with potential consequences such as fines and other expenses related to such governmental actions, an order requiring that we change our data practices or business practices, and could cause our clients to lose trust in us, any of which could have an adverse effect on our business.

Our products and services and the systems infrastructure necessary for the successful delivery of our products and services to clients are inherently complex and may contain material defects or errors unknown to us. We have from time to time found defects in our products and services after delivery to our customers and may discover additional defects in the future. In particular, we have developed our own tools and processes to deliver comprehensive tax, legal and regulatory updates tailored for each client, which we endeavor to deliver to our clients in a shorter timeframe than our competitors, which may result in an increased risk of material defects or errors occurring. We may not be able to detect and correct all defects or errors before clients begin to use our products and services, as some may be unknown. Consequently, defects or errors may be discovered after our products and services are provided and used. These defects or errors could also cause inaccuracies in the data we collect and process for our clients, or even the loss, damage or inadvertent release of such confidential data. Even if we are able to implement fixes or corrections to our tax, legal and regulatory updates in a timely manner, any history of defects or inaccuracies in the data we collect for our clients, or the loss, damage or inadvertent release of such confidential data could cause our reputation to be harmed, and clients may elect not to renew, extend or expand their agreements with us and subject us to service performance credits, warranty or other claims or increased insurance costs. The costs associated with any material defects or errors in our products and services or other performance problems may be substantial and could materially adversely affect our financial condition and results of operations.

We have had material weaknesses in our internal control over financial reporting. As described under “Controls and Procedures” in Part II, Item 9A of our 2021 Form 10-K, our management concluded that we had a material weakness in our internal control over financial reporting as of March 31, 2021 and December 31, 2020, due to inadequate controls in relation to improperly applying the accounting guidance for our GP Sponsor Private Placement Warrants, recognizing the warrants as equity instead of as a liability.

With respect to controls over revenue accounting procedures, we intend to continue to work on automating our processes, especially around Accounting Standards Codification 606 (“ASC 606”), Revenue from Contracts with Customers, as well as to continue to enhance our review processes around new and renewal contracts. In addition, we are required to have our independent registered public accounting firm attest to and report on management’s assessment of the effectiveness of our internal control over financial reporting. If we are unable to conclude that we have effective internal control over financial reporting, or if our independent registered public accounting firm is unable to provide us with an attestation and an unqualified report as to the effectiveness of our internal control over financial reporting, investors could lose confidence in the reliability of our financial statements, which could result in a decrease in the value of our securities. For further information regarding our controls and procedures, see “Controls and Procedures” in Part I, Item 4 of this Report.

We believe that our development and protection of the Rimini Street brand is critical to achieving widespread awareness of our products and services, and as a result, is important to attracting new clients and maintaining existing clients. We also believe that the importance of brand recognition will increase as competition in our market increases. Successful promotion of our brand will depend largely on the effectiveness of our marketing efforts and on our ability to provide reliable products and services at competitive prices, as well as the outcome of our ongoing litigation with Oracle. Brand promotion activities may not yield increased revenue, and even if they do, any increased revenue may not offset the expenses we incurred in building our brand. If we fail to successfully promote, maintain and protect our brand, our business could be adversely impacted.

Our success depends, in part, upon protecting our proprietary products, services, knowledge, software tools and processes. We rely on a combination of copyrights, trademarks, service marks, trade secret laws and contractual restrictions to establish and protect our proprietary rights. However, the steps we take to protect our intellectual property may be inadequate. We will not be able to protect our intellectual property if we are unable to enforce our rights or if we do not detect unauthorized use of our intellectual property. Any of our copyrights, trademarks, service marks, trade secret rights or other intellectual property rights may be challenged by others or invalidated through administrative process or litigation. Furthermore, legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain. Despite our precautions, it may be possible for unauthorized third parties to copy or use information that we regard as proprietary to create products and services that compete with ours. In addition, the laws of some countries do not protect proprietary rights to the same extent as the laws of the United States. To the extent we expand our global activities, our exposure to unauthorized copying and use of our brand, processes and software tools may increase.

To protect our intellectual property rights, we may be required to spend significant resources to monitor and protect these rights. Litigation brought to protect and enforce our intellectual property rights could be costly, time consuming and distracting to management and could result in the impairment or loss of portions of our intellectual property. Furthermore, our efforts to enforce our intellectual property rights may be met with defenses, counterclaims and countersuits attacking the validity and enforceability of our intellectual property rights. Our inability to protect our products, processes and software tools against unauthorized copying or use, as well as any costly litigation or diversion of our management’s attention and resources, could delay further sales or the implementation of our products and services, impair the functionality of our products and services, delay introductions of new products and services, result in our substituting inferior or more costly technologies into our products and services, or injure our reputation.

State, local and foreign jurisdictions have differing and complex rules and regulations governing sales, use, value-added and other taxes, and these rules and regulations can be subject to varying interpretations that may change over time. In particular, the applicability of such taxes to our products and services in various jurisdictions is unclear. Further, these jurisdictions’ rules regarding tax nexus are complex and can vary significantly. As a result, we could face the possibility of tax assessments and audits, and our liability for these taxes and associated interest and penalties could exceed our original estimates. Should these jurisdictions determine that we should be collecting additional sales, use, value-added or other taxes, it could result in substantial tax liabilities and related penalties for past sales, discourage clients from purchasing our products and services or otherwise harm our business and results of operations.

In addition, under Section 382 of the Internal Revenue Code of 1986, as amended, our ability to utilize net operating loss carryforwards or other tax attributes in any taxable year may be limited if we experience an “ownership change.” A Section 382 “ownership change” generally occurs if one or more stockholders or groups of stockholders who own at least 5% of our stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. Similar rules may apply under state tax laws in the United States. While our ownership changes to date have not triggered any limitations under Section 382, it is possible that any future ownership changes or issuances of our capital stock, could have a material effect on the use of our net operating loss carryforwards or other tax attributes, which could adversely affect our profitability.

As a multinational organization, we may be subject to taxation in several jurisdictions worldwide with increasingly complex tax laws, the application of which can be uncertain. Significant judgment is required in determining our worldwide provision for income taxes. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. As such, our results may differ from previous estimates and may materially affect our financial position.

The amount of taxes we pay in jurisdictions in which we operate could increase substantially as a result of changes in the applicable tax principles, including increased tax rates, new tax laws or revised interpretations of existing tax laws and precedents, which could have a material adverse effect on our liquidity and results of operations. In addition, the authorities in these jurisdictions could review our tax returns and impose additional tax, interest and penalties, and the authorities could claim that various withholding requirements apply to us or our subsidiaries or assert that benefits of tax treaties are not available to us or our subsidiaries, any of which could have a material impact on our business and results of operations.

As a result, our stockholders may not have had access to certain information they may deem important in our filings with the SEC for periods through December 31, 2021, including the proxy statement for our 2022 Annual Meeting of Stockholders, which was filed with the SEC on April 29, 2022. We cannot predict whether investors will find our securities less attractive because we relied on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions, the market price of our Common Stock may be lower than they otherwise would be, there may be a less active trading market for our Common Stock and the market price of our Common Stock may be more volatile.

We expect to depend primarily on cash generated by our operations for funds to pay our expenses and any amounts due under our Credit Facility and any other indebtedness we may incur. Our ability to make these payments depends on our future performance, which will be affected by financial, business, economic and other factors, many of which we cannot control, including the impacts of the COVID-19 pandemic, inflation and global economic conditions. Our business may not generate sufficient cash flows from operations in the future and our currently anticipated growth in net sales and cash flows may not be realized, either or both of which could result in our being unable to repay indebtedness or to fund other liquidity needs. If we do not generate adequate resources, we may be required to refinance all or part of our then existing debt, sell assets or borrow more money, in each case on terms that may not be acceptable to us. In addition, the terms of existing or future debt agreements, including our existing Credit Facility, may restrict us from adopting some or any of these alternatives. Our inability to incur additional debt in the future could also delay or prevent a change in control of our Company, make some transactions more difficult and impose additional financial or other covenants on us. In addition, any significant levels of indebtedness in the future could make us more vulnerable to economic downturns and adverse developments in our business. Our current

Our Credit Facility contains certain restrictions and covenants that generally limit our ability to, among other things, create liens on assets, sell assets, engage in mergers or consolidations, make loans or investments, incur additional indebtedness, engage in certain transactions with affiliates, incur certain material ERISA or pension liabilities and pay dividends or repurchase capital stock and in each case, subject to certain exceptions set forth in our credit agreement. Our Credit Facility may limit our ability to engage in these types of transactions even if we believe that a specific transaction would contribute to our future growth or improve our operating results. Our Credit Facility also requires us to achieve specified financial and operating results and maintain compliance with specified financial ratios, including as a condition to accessing additional amounts available for borrowing. As of September 30, 2022, we were in compliance with each of these financial covenants. Our ability to comply with these provisions may be affected by events beyond our control. A breach of any of these financial covenants or our inability to comply with required financial ratios in our Credit Facility could result in a default under the Credit Facility in which case the lenders would have the right to declare all borrowings, which includes any principal amount outstanding, together with all accrued, unpaid interest and other amounts owing in respect thereof, to be immediately due and payable. If we are unable to repay all borrowings when due, whether at maturity or if declared due and payable following a default, the lenders would have the right to proceed against the collateral granted to secure the indebtedness. If we breach these covenants or fail to comply with other terms of the Credit Facility and the lenders accelerate the amounts outstanding under the Credit Facility, our business and results of operations would be adversely affected. Additionally, we may need to refinance our Credit Facility at maturity or upon default, and future financing may not be available on acceptable terms, or at all.

As a result of market interest rate fluctuations, interest rates under our Credit Facility or other variable rate indebtedness we may incur in the future could be higher or lower than current levels. As interest rates increase, our debt service obligations under our Credit Facility may increase even though the amounts borrowed remain the same, and our net income (loss) and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease. In addition, a transition away from LIBOR as a benchmark for establishing the applicable interest rate may affect the cost of servicing our debt under the Credit Facility. In July 2017, the Financial Conduct Authority of the U.K. announced that it plans to phase out LIBOR by the end of calendar year 2021. On March 5, 2021, however, the ICE Benchmark Administration, the administrator of LIBOR, announced its intention to cease the publication of all settings of non-U.S. dollar LIBOR and only the one-week and two-month U.S. dollar LIBOR settings on December 31, 2021, with the publication of the remaining U.S. dollar LIBOR settings being discontinued after September 30, 2023. While we expect LIBOR to be available in substantially its current form until at least the end of September 30, 2023, it is possible that LIBOR will become unavailable prior to that point. This could result, for example, if sufficient banks decline to make submissions to the LIBOR administrator. In that case, the risks associated with the transition to an alternative base rate will be accelerated and magnified. Our borrowing arrangements provide for alternative base rates, but such alternative base rates may or may not be related to LIBOR, and the consequences of the phase out of LIBOR cannot be entirely predicted at this time. For example, if any alternative base rate or means of calculating interest with respect to our outstanding variable rate indebtedness leads to an increase in the interest rates charged, it could result in an increase in the cost of such indebtedness or impact our ability to refinance some or all of our existing indebtedness, or otherwise have a material adverse impact on our business, financial condition and results of operations.

Our Board of Directors has authorized a $50.0 million stock repurchase program. During the three months ended September 30, 2022, we acquired 0.2 million shares of Common Stock on the open market at a cost of $1.0 million. Upon completion of this repurchase, these shares of Common Stock were retired. Repurchases pursuant to any such stock repurchase program could affect our Common Stock price and increase its volatility. The existence of a stock repurchase program could also cause our Common Stock price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our Common Stock. Such repurchase program will not obligate us to repurchase any further specific dollar amount or number of shares of Common Stock within that authorization and may be suspended or discontinued at any time, which could cause the market price of our Common Stock to decline. The timing and actual number of further shares

repurchased under any such stock repurchase program depends on a variety of factors including the timing of open trading windows, price, corporate and regulatory requirements, and other market conditions. There can be no assurance that any stock repurchases will enhance stockholder value because the market price of our Common Stock may decline below the levels at which we repurchased shares of Common Stock. Although our stock repurchase program is intended to enhance stockholder value, short-term stock price fluctuations could reduce the program’s effectiveness.

These factors may materially reduce the market price of our Common Stock, regardless of our operating performance. Additionally, we have registered for resale the shares of Common Stock of certain of our significant holders of our Common Stock, including Adams Street Partners, LLC. Any sale of large amounts of our Common Stock on the open market or in privately negotiated transactions could have the effect of increasing the volatility in the price of our Common Stock or putting significant downward pressure on the price of our Common Stock. Also, the issuance of Common Stock upon exercise of warrants that remain outstanding and exercisable may result in immediate and substantial dilution to the equity interests of our existing common stockholders and might result in dilution in the tangible net book value of a share of Common Stock, depending upon the price on which the additional shares are issued. We may also seek to engage in further capital optimization transactions in the future, the result of which could trigger some dilution or have other impacts on the market price of our Common Stock and not achieve an improved capital structure. Any issuance of equity we may undertake in the future to raise additional capital could cause the price of our Common Stock to decline or require us to issue shares at a price that is lower than that paid by holders of our Common Stock in the past, which would result in those newly issued shares being dilutive.

Based on the number of shares of Common Stock outstanding as of September 30, 2022, two of our stockholders have aggregate voting power of 39.8% of our outstanding capital stock. As of September 30, 2022, (i) approximately 26.7% of our outstanding voting capital stock is held by Adams Street Partners LLC and certain Adams Street fund limited partnerships and (ii) approximately 13.1% of our outstanding voting capital stock is beneficially owned by our Chief Executive Officer. Our directors and officers or persons affiliated with our directors and officers have aggregate voting power of approximately 42.2% as of September 30, 2022.

We have not paid any cash dividends on our Common Stock to date. The payment of any cash dividends on our Common Stock will depend upon our revenue, earnings, cash flow and financial condition from time to time. The payment of any dividends is at the discretion of our Board of Directors and is also limited under the terms of our Credit Facility. Our ability to declare dividends on our Common Stock may also be limited by the terms of future financing and other agreements entered into by us from time to time. It is presently expected that we will retain all earnings for use in our business operations and, accordingly, it is not expected that our Board of Directors will declare any dividends on our Common Stock in the foreseeable future. Therefore, the success of an investment in shares of our Common Stock will depend upon any future appreciation in its value. There is no guarantee that shares of our Common Stock will appreciate in value or even maintain the price at which our stockholders have purchased their shares.

Our certificate of incorporation and bylaws, and Delaware General Corporation Law (the “DGCL”), contain provisions that could have the effect of rendering more difficult, delaying, or preventing an acquisition deemed undesirable by our Board of Directors and therefore depress the trading price of our Common Stock. These provisions could also make it difficult for stockholders to take certain actions, including electing directors who are not nominated by the current members of our Board of Directors or taking other corporate actions, including effecting changes in our management and corporate governance policies and practices. Among other things, our certificate of incorporation and bylaws include provisions regarding:

•the requirement for the affirmative vote of holders of at least 66 2/3% of the voting power of the then outstanding shares of the voting stock, voting together as a single class, to amend, alter, change or repeal any provision of our certificate of incorporation or our bylaws, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in our Board of Directors and also may inhibit the ability of an acquirer to effect such amendments to facilitate an unsolicited takeover attempt;

•advance notice procedures with which stockholders must comply to nominate candidates to our Board of Directors or to propose matters to be acted upon at a stockholders’ meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in our Board of Directors and also may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, or other employees, which may discourage lawsuits with respect to such claims. Alternatively, if a court were to find the choice of forum provision to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations and financial condition. This choice of forum provision does not operate to restrict suits brought to enforce any liability or duty created by the Securities Act or the Exchange Act.

We may in the future seek to acquire or invest in businesses, products or technologies that we believe could complement or expand our services, enhance our technical capabilities or otherwise offer growth opportunities. The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable acquisitions, whether or not the acquisitions are completed. If we acquire businesses, we may not be able to integrate successfully the acquired personnel, operations and technologies, or effectively manage the combined business following the acquisition. We may not be able to find and identify desirable acquisition targets or be successful in entering into an agreement with any particular target or obtain adequate financing to complete such acquisitions. Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our results of operations. In addition, if an acquired business fails to meet our expectations, our business, financial condition and results of operations may be adversely affected.

The commercial insurance market is changing rapidly in response to rising insurance losses and claims, changes in available insurance capacity and adverse worldwide economic conditions, uncertainties, and risks, which may lead to higher premium costs, higher policy deductibles, self-insured retentions, and/or lower coverage limits, potentially impacting our ability to continue our present limits of insurance coverage, obtain sufficient insurance capacity to adequately insure our risks or maintain adequate insurance at a reasonable cost.

Commercial insurance availability and coverage terms, including deductibles, self-insured retentions and pricing, continue to vary with market conditions. While we believe our insurance coverage addresses all material risks to which we are exposed and is adequate and customary for our current global operations, we have observed rapidly changing conditions in the insurance markets relating to nearly all areas of traditional corporate insurance, resulting in higher premium costs, rising policy deductibles/self-insured retentions and lower coverage limits. If these changes continue, we may not be able to continue our present limits of insurance coverage, obtain sufficient insurance capacity to adequately insure our risks and/or obtain and maintain adequate insurance at a reasonable cost. Our insurance policies cover a number of risks and potential liabilities, such as general liability, property coverage, errors and omissions liability, employment liability, business interruptions, cybersecurity

liability, crime, and directors’ and officers’ liability. We cannot be certain that our insurance coverage will be adequate to cover liabilities actually incurred, that insurance will continue to be available to us on commercially reasonable terms, or at all, or that any insurer will not deny coverage as to any future claim or become insolvent. The successful assertion of one or more large claims against us that exceed available insurance coverage, the occurrence of changes in our insurance policies, including premium increases, decreases in coverage and the imposition of large deductible, self-insured retentions, or co-insurance requirements, or the insolvency of any of our insurers, could have a material adverse effect on our business, results of operations and financial condition.

We rely heavily on our network infrastructure and information technology systems for our business operations. A disruption or failure of these systems in the event of an online attack, earthquake, fire, terrorist attack, geopolitical instability including the ongoing conflict between Russia and Ukraine, war, power loss, telecommunications failure, extreme weather conditions (such as hurricanes, wildfires or floods) or other catastrophic event could cause system interruptions, delays in accessing our service, reputational harm, loss of critical data or could prevent us from providing our products and services to our clients. In addition, several of our employee groups reside in areas particularly susceptible to earthquakes, such as the San Francisco Bay Area and Japan, and a major earthquake or other catastrophic event could affect our employees, who may not be able to access our systems, or otherwise continue to provide our services to our clients. A catastrophic event that results in the destruction or disruption of our data centers, or our network infrastructure or information technology systems, or access to our systems could affect our ability to conduct normal business operations and adversely affect our business, financial condition and results of operations. Additionally, the emergence or spread of a pandemic or other widespread health emergency (or concerns over and response to the possibility of such an emergency), including any lingering impacts of the COVID-19 pandemic, that causes any of our employee groups to become ill, quarantined or otherwise unable to work and/or travel due to health reasons or governmental or client corporate restrictions, or causes our clients to have ill or logistically restricted workforces, or who choose to cease or delay meetings with us or decisions regarding engaging our services could adversely affect our business, financial condition and results of operations.

In certain jurisdictions, these regulatory requirements may be more stringent than those in the United States. Noncompliance with applicable requirements could subject us to investigations, sanctions, enforcement actions, disgorgement of profits, fines, damages, civil and criminal penalties or injunctions and may result in our inability to provide certain products and services. If any governmental sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, or if clients make claims against us for compensation for such non-compliance, our business, financial condition and results of operations could be harmed, and responding to any such type of action will likely result in a significant diversion of management’s attention and resources.

Securities research analysts may establish and publish their own periodic projections for us. These projections may vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not meet the projections of these securities research analysts. Similarly, if one or more of the analysts who write reports on us downgrades our stock or publishes inaccurate or unfavorable research about our business, our share price could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, our share price or trading volume could decline. If no additional analysts commence coverage of us, the market price and volume for our common shares could be adversely affected.

Incorporated by Reference

Exhibit
Number

Description

Form

File No.

Exhibit

Filing Date

3.1*

Amended and Restated Certificate of Incorporation of the Registrant

8-K

001-37397

3.1

October 16, 2017

3.2*

Amended and Restated Bylaws of the Registrant

8-K

001-37397

3.2

October 16, 2017

31.1†

Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a)

31.2†

Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a)

32.1**

Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350

32.2**

Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350

101.INS†

Inline XBRL Instance Document

101.SCH†

Inline XBRL Taxonomy Extension Schema

101.CAL†

Inline XBRL Taxonomy Extension Calculation Linkbase

101.DEF†

Inline XBRL Taxonomy Extension Definition Linkbase

101.LAB†

Inline XBRL Taxonomy Extension Label Linkbase

101.PRE†

Inline XBRL Taxonomy Extension Presentation Linkbase

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


Delaware						36-4880301
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

3993 Howard Hughes Parkway, Suite 500, Las Vegas, NV						89169
(Address of principal executive offices)						(Zip Code)

Registrant's telephone number, including area code:						(702) 839-9671


Title of each class:	Trading Symbol(s)	Name of each exchange on which registered:

Common Stock, par value $0.0001 per share	RMNI	The Nasdaq Global Market


		Page

PART I. FINANCIAL INFORMATION		2

ITEM 1.	Financial Statements	2

	Unaudited Condensed Consolidated Balance Sheets	2

	Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income	3

	Unaudited Condensed Consolidated Statements of Stockholders' Deficit	4

	Unaudited Condensed Consolidated Statements of Cash Flows	5

	Notes to Unaudited Condensed Consolidated Financial Statements	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	38

ITEM 4.	Controls and Procedures	39

PART II. OTHER INFORMATION		40

ITEM 1.	Legal Proceedings	40

ITEM 1A.	Risk Factors	40

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	62

ITEM 3.	Defaults Upon Senior Securities	63

ITEM 4.	Mine Safety Disclosures	63

ITEM 5.	Other Information	63

ITEM 6.	Exhibits	64

SIGNATURES		65


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Deferred revenue, current and noncurrent, as of the beginning of period	$	300,387	$	265,638	$	300,268	$	256,933
Billings, net	49,731		73,686		248,960		261,900
Revenue recognized	(101,931)		(95,642)		(301,041)		(275,151)
Deferred revenue, current and noncurrent, as of the end of period	$	248,187	$	243,682	$	248,187	$	243,682


	September 30,		December 31,
	2022		2021
Accrued sales and other taxes	$	3,908	$	8,805
Accrued professional fees	6,287		4,502
Current maturities of capital lease obligations	326		315
Income taxes payable	1,160		1,546
Accrued litigation settlement costs	7,415		7,530
Other accrued expenses	4,790		3,426
Total other accrued liabilities	$	23,886	$	26,124


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934


Rimini Street, Inc.
(Exact name of registrant as specified in its charter)


Large accelerated filer ¨			Accelerated filer þ			Non-accelerated filer ¨


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Credit Facility:
Interest expense	$	897	$	435	$	2,174	$	435
Accretion expense related to discount and issuance costs	245		196		728		196
Interest on finance leases	25		22		72		107
	$	1,167	$	653	$	2,974	$	738


	Series A Preferred Stock
	Shares	Amount
Net carrying value as of December 31, 2020	154,911	$	137,854
Issuance of shares to settle PIK Dividends on January 4, 2021	1,193	1,193
Repurchase of 10,000 shares on January 5, 2021	(10,000)	(8,913)
Accretion of discount for the three months ended March 31, 2021	—	1,473
Net carrying value as of March 31, 2021	146,104	131,607
Issuance of shares to settle PIK Dividends on April 1, 2021	1,051	1,051
Redemption of 60,000 shares on April 16, 2021	(60,000)	(54,327)
Accretion of discount for the three months ended June 30, 2021	—	804
Net carrying value as of June 30, 2021	87,155	79,135
Issuance of shares to settle PIK Dividends on July 1, 2021	647	647
Redemption of 87,802 shares on July 20, 2021	(87,802)	(79,782)
Net carrying value as of September 30, 2021	—	$	—


	Shares	Price (1)		Term (2)
Outstanding, December 31, 2021	6,824	$	5.92	5.6
Granted	1,243	5.64
Forfeited	(382)	5.88
Expired	(163)	5.76
Exercised	(517)	1.86
Outstanding, September 30, 2022 (3)(4)	7,005	6.17		5.8
Vested, September 30, 2022 (3)	4,543	6.15		4.0


Available, December 31, 2021			4,324
Newly authorized by Board of Directors			3,484
Stock options granted			(1,243)
RSUs granted			(821)
Expired options under Stock Plans			163
Forfeited options under Stock Plans			382
Forfeited RSUs under Stock Plans			514
Shares issued			(60)
Shares repurchased			853
Available, September 30, 2022			7,596


Expected life (in years)			6.0
Volatility			46%
Dividend yield			0%
Risk-free interest rate			2.63%
Fair value per share of Common Stock on date of grant			$5.64


	Three Months Ended	Nine Months Ended
	September 30, 2022	September 30, 2022
RSUs	1,243	460
Stock options	4,914	4,161
Warrants	18,128	18,128
Total	24,285	22,749


	Fair Value Level	Cost Basis		Gains (Losses)		Recorded Basis		Cash Equivalents		Short-term Investments
Federal Agency Bonds	Level 2	$	13,356	$	(5)	$	13,351	$	6,161	$	7,190
US Government bonds	Level 2	494		—		494		—		494
US Treasury notes	Level 2	5,447		9		5,456		1,993		3,463
Variable Note	Level 2	703		—		703		703		—
Cash		—		—		—		—		—
		$	20,000	$	4	$	20,004	$	8,857	$	11,147


Weighted Average Remaining Lease Term	Years
Operating leases	3.64
Weighted Average Discount Rate
Operating leases	10.3	%


Year ending September 30:
2023	$	5,336
2024	4,666
2025	3,546
2026	2,428
2027	832
Thereafter	—
Total future undiscounted lease payments	16,808
Less imputed interest	(2,698)
Total	$	14,110


Derivative Instrument	Balance Sheet Classification					September 30, 2022		December 31, 2021
Interest rate swap	Deposits and other					$	1,550	$	—
	Accumulated other comprehensive loss					1,220		—
		For the Three Months Ended September 30,				For the Nine Months Ended September 30,
Derivative Instrument	Income Statement Classification	2022		2021		2022		2021
Interest rate swap	Interest expense	$	81	$	—	$	224	$	—


Supplemental Balance Sheet Information	September 30, 2022		December 31, 2021
Operating lease right-of-use assets, noncurrent	$	10,843	$	12,722

	September 30, 2022		December 31, 2021
Operating lease liabilities, current	$	4,123	$	4,227
Operating lease liabilities, noncurrent	9,987		12,511
Total operating lease liabilities	$	14,110	$	16,738


Period	Total number of shares purchased	Average price paid per share		Total number of shares purchased as part of publicly announced plan (1)	Approximate dollar value of shares that may yet be purchased (2)
July 1-31, 2022	—	$	—	—	$	46,252,000
August 1-31, 2022	100,000	$	5.09	100,000	$	45,743,000
September 1-30, 2022	100,000	$	4.84	100,000	$	45,260,000
Total	200,000			200,000


			RIMINI STREET, INC.

Date: November 2, 2022			/s/ Seth A. Ravin
			Name: Seth A. Ravin
			Title: Chief Executive Officer
			(Principal Executive Officer)


Date: November 2, 2022			/s/ Michael L. Perica
			Name: Michael L. Perica
			Title: Executive Vice President and Chief Financial Officer
			(Principal Financial Officer)


			/s/ Seth A. Ravin
			Seth A. Ravin
			Title: Chief Executive Officer
			(Principal Executive Officer)


			/s/ Michael L. Perica
			Michael L. Perica
			Title: Executive Vice President and Chief Financial Officer
			(Principal Financial Officer)


Dated: November 2, 2022	By:	/s/ Seth A. Ravin
		Seth A. Ravin
		Title: Chief Executive Officer
		(Principal Executive Officer)

Cover - shares	9 Months Ended
Cover - shares	Sep. 30, 2022	Oct. 31, 2022
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	001-37397
Entity Registrant Name	Rimini Street, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-4880301
Entity Address, Address Line One	3993 Howard Hughes Parkway
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Las Vegas
Entity Address, State or Province	NV
Entity Address, Postal Zip Code	89169
City Area Code	(702)
Local Phone Number	839-9671
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		88,278,000
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity Central Index Key	0001635282
Current Fiscal Year End Date	--12-31
Common Stock, par value $0.0001 per share
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	RMNI
Security Exchange Name	NASDAQ

Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 118,576	$ 119,571
Restricted cash	417	419
Accounts receivable, net of allowance of $744 and $576, respectively	59,223	135,447
Deferred contract costs, current	16,372	14,985
Short-term investments	11,147	0
Prepaid expenses and other	21,253	16,340
Total current assets	226,988	286,762
Long-term assets:
Property and equipment, net of accumulated depreciation and amortization of $14,754 and $13,278, respectively	5,565	4,435
Operating lease right-of-use assets	10,843	12,722
Deferred contract costs, noncurrent	22,548	21,524
Deposits and other	3,975	1,786
Deferred income taxes, net	63,430	64,033
Total assets	333,349	391,262
Current liabilities:
Current maturities of long-term debt	4,227	3,664
Accounts payable	8,301	5,708
Accrued compensation, benefits and commissions	35,993	36,558
Other accrued liabilities	23,886	26,124
Operating lease liabilities, current	4,123	4,227
Deferred revenue, current	212,070	253,221
Total current liabilities	288,600	329,502
Long-term liabilities:
Long-term debt, net of current maturities	71,445	79,655
Deferred revenue, noncurrent	36,117	47,047
Operating lease liabilities, noncurrent	9,987	12,511
Other long-term liabilities	2,575	2,933
Total liabilities	408,724	471,648
Commitments and contingencies
Stockholders’ deficit:
Preferred stock; $0.0001 par value. Authorized 99,820 shares (excluding 180 shares of Series A Preferred Stock); no other series has been designated	0	0
Common stock; $0.0001 par value. Authorized 1,000,000 shares; issued and outstanding 88,223 and 87,107 shares, respectively	9	9
Additional paid-in capital	154,111	149,234
Accumulated other comprehensive loss	(5,382)	(2,724)
Accumulated deficit	(222,997)	(225,789)
Treasury stock, at cost	(1,116)	(1,116)
Total stockholders' deficit	(75,375)	(80,386)
Total liabilities and stockholders' deficit	$ 333,349	$ 391,262

Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 744	$ 576
Accumulated depreciation and amortization	$ 14,754	$ 13,278
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (shares)	99,820,000	99,820,000
Redeemable preferred stock, shares authorized (shares)	180,000	180,000
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (shares)	1,000,000,000	1,000,000,000
Common stock, shares issued (shares)	88,223,000	87,107,000
Common stock, shares outstanding (shares)	88,223,000	87,107,000

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Statement [Abstract]
Revenue	$ 101,931	$ 95,642	$ 301,041	$ 275,151
Cost of revenue	39,271	33,376	113,822	101,807
Gross profit	62,660	62,266	187,219	173,344
Operating expenses:
Sales and marketing	35,934	32,527	103,840	96,067
General and administrative	18,454	15,631	57,267	48,728
Impairment charges related to operating right of use assets	0	0	0	393
Litigation costs and related recoveries:
Professional fees and other costs of litigation	6,145	6,581	12,837	14,130
Insurance costs and recoveries, net	92	0	(389)	0
Litigation costs and related recoveries, net	6,237	6,581	12,448	14,130
Total operating expenses	60,625	54,739	173,555	159,318
Operating income	2,035	7,527	13,664	14,026
Non-operating income and (expenses):
Interest expense	(1,167)	(653)	(2,974)	(738)
Loss on change in fair value of redeemable warrants	0	(2,053)	0	(3,023)
Other income (expenses), net	(1,329)	(1,161)	(2,696)	(885)
Income (loss) before income taxes	(461)	3,660	7,994	9,380
Income taxes	56	(1,729)	(5,202)	(4,218)
Net income (loss)	(405)	1,931	2,792	5,162
Other comprehensive income (loss):
Foreign currency translation loss	(1,667)	(454)	(3,878)	(2,398)
Derivative instrument adjustments, net of tax	1,220	0	1,220	0
Comprehensive income (loss)	(852)	1,477	134	2,764
Net income (loss) attributable to common stockholders	$ (405)	$ (6,691)	$ 2,792	$ (21,382)
Net income (loss) per share attributable to common stockholders:
Basic (in dollars per share)	$ 0	$ (0.08)	$ 0.03	$ (0.26)
Diluted (in dollars per share)	$ 0	$ (0.08)	$ 0.03	$ (0.26)
Weighted average number of shares of Common Stock outstanding:
Weighted average number of shares outstanding, basic (shares)	87,965	86,189	87,441	83,449
Weighted average number of shares outstanding, diluted (shares)	87,965	86,189	89,054	83,449

Unaudited Condensed Consolidated Statements of Stockholders' Deficit - USD ($) shares in Thousands, $ in Thousands	Total	Series A Preferred Stock	Common Stock	Additional Paid-in Capital	Additional Paid-in Capital Series A Preferred Stock	Accumulated Other Comprehensive Loss	Accumulated Deficit	Treasury Stock	March 2021 and August 2020 Offering Common Stock	March 2021 and August 2020 Offering Additional Paid-in Capital
Beginning balance (shares) at Dec. 31, 2020			76,406
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options for cash (shares)			1,183
Restricted stock units vested (shares)			1,456
Issuance of common stock (shares)									7,750
Treasury shares (shares)			(137)
Retired shares of Common Stock (shares)			0
Ending balance (shares) at Sep. 30, 2021			86,658
Stockholders' deficit, beginning of period at Dec. 31, 2020	$ (203,060)		$ 8	$ 98,258		$ (318)	$ (301,008)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense				7,104
Exercise of stock options for cash			0	5,046
Restricted stock units vested			0	0
Issuance of Common Stock									$ 1	$ 55,641
Treasury shares			0					$ (1,116)
Retired shares of Common Stock			0							0
Accretion related to redemption of Series A Preferred Stock				(13,693)
Make-whole dividends related to redemption of Series A Preferred Stock		$ (2,945)		(2,945)
Return on repurchase of Series A Preferred Stock shares		(38)			$ (38)
Accretion of discount on Series A Preferred Stock				(2,277)
Accrued dividends on Series A Preferred Stock:
Payable in cash				(5,839)
Payable in kind				(1,752)
Other comprehensive loss						(2,398)
Net income	5,162						5,162
Treasury Stock			0					(1,116)
Stockholders' deficit, end of period at Sep. 30, 2021	(160,164)		$ 9	139,505		(2,716)	(295,846)
Beginning balance (shares) at Jun. 30, 2021			85,704
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options for cash (shares)			383
Restricted stock units vested (shares)			708
Issuance of common stock (shares)									0
Treasury shares (shares)			(137)
Retired shares of Common Stock (shares)			0
Ending balance (shares) at Sep. 30, 2021			86,658
Stockholders' deficit, beginning of period at Jun. 30, 2021	(156,299)		$ 9	143,801		(2,262)	(297,777)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense				2,393
Exercise of stock options for cash			0	1,933
Restricted stock units vested			0	0
Issuance of Common Stock									$ 0	0
Treasury shares			0					(1,116)
Retired shares of Common Stock			0							0
Accretion related to redemption of Series A Preferred Stock				(8,020)
Make-whole dividends related to redemption of Series A Preferred Stock		(602)		(602)
Return on repurchase of Series A Preferred Stock shares		0			0
Accretion of discount on Series A Preferred Stock				0
Accrued dividends on Series A Preferred Stock:
Payable in cash				0
Payable in kind				0
Other comprehensive loss						(454)
Net income	1,931						1,931
Treasury Stock			0					(1,116)
Stockholders' deficit, end of period at Sep. 30, 2021	(160,164)		$ 9	139,505		(2,716)	(295,846)
Beginning balance (shares) at Dec. 31, 2021			87,107
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options for cash (shares)			518
Restricted stock units vested (shares)			1,391
Issuance of common stock (shares)									60
Treasury shares (shares)			0
Retired shares of Common Stock (shares)			(853)
Ending balance (shares) at Sep. 30, 2022			88,223
Stockholders' deficit, beginning of period at Dec. 31, 2021	(80,386)		$ 9	149,234		(2,724)	(225,789)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense				8,653
Exercise of stock options for cash			0	964
Restricted stock units vested			0	0
Issuance of Common Stock									$ 0	0
Treasury shares			0					(1,116)
Retired shares of Common Stock			0							(4,740)
Accretion related to redemption of Series A Preferred Stock				0
Make-whole dividends related to redemption of Series A Preferred Stock		0		0
Return on repurchase of Series A Preferred Stock shares		0			0
Accretion of discount on Series A Preferred Stock				0
Accrued dividends on Series A Preferred Stock:
Payable in cash				0
Payable in kind				0
Other comprehensive loss						(2,658)
Net income	2,792						2,792
Treasury Stock			0					(1,116)
Stockholders' deficit, end of period at Sep. 30, 2022	(75,375)		$ 9	154,111		(5,382)	(222,997)
Beginning balance (shares) at Jun. 30, 2022			87,529
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options for cash (shares)			193
Restricted stock units vested (shares)			701
Issuance of common stock (shares)									0
Treasury shares (shares)			0
Retired shares of Common Stock (shares)			(200)
Ending balance (shares) at Sep. 30, 2022			88,223
Stockholders' deficit, beginning of period at Jun. 30, 2022	(76,487)		$ 9	152,147		(4,935)	(222,592)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense				2,443
Exercise of stock options for cash			0	513
Restricted stock units vested			0	0
Issuance of Common Stock									$ 0	0
Treasury shares			0					(1,116)
Retired shares of Common Stock			0							$ (992)
Accretion related to redemption of Series A Preferred Stock				0
Make-whole dividends related to redemption of Series A Preferred Stock		0		0
Return on repurchase of Series A Preferred Stock shares		$ 0			$ 0
Accretion of discount on Series A Preferred Stock				0
Accrued dividends on Series A Preferred Stock:
Payable in cash				0
Payable in kind				0
Other comprehensive loss						(447)
Net income	(405)						(405)
Treasury Stock			0					$ (1,116)
Stockholders' deficit, end of period at Sep. 30, 2022	$ (75,375)		$ 9	$ 154,111		$ (5,382)	$ (222,997)

Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 2,792	$ 5,162
Adjustments to reconcile net income to net cash provided by operating activities:
Loss on change in fair value of redeemable warrants	0	3,023
Stock-based compensation expense	8,653	7,104
Depreciation and amortization	1,871	1,772
Accretion and amortization of debt discount and issuance costs	728	196
Deferred income taxes	327	1
Impairment charges related to operating right of use assets	0	393
Amortization and accretion related to operating right of use assets	4,140	4,625
Changes in operating assets and liabilities:
Accounts receivable	75,068	41,021
Prepaid expenses, deposits and other	(6,417)	(4,289)
Deferred contract costs	(2,412)	(1,780)
Accounts payable	2,710	5,605
Accrued compensation, benefits, commissions and other liabilities	(3,842)	(3,940)
Deferred revenue	(46,861)	(11,079)
Net cash provided by operating activities	36,757	47,814
CASH FLOWS USED IN INVESTING ACTIVITIES:
Capital expenditures	(3,144)	(1,455)
Investment purchases	(11,148)	0
Net cash used in investing activities	(14,292)	(1,455)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds related to Common Stock issuances in March 2021 Offering	0	56,965
Payments of professional fees related to Common Stock issuances in March 2021 Offering	(27)	(1,296)
Proceeds from issuance of Credit Facility	0	89,313
Debt issuance costs paid	0	(4,013)
Principal payments on the Credit Facility	(8,375)	(1,125)
Payments to repurchase shares of Series A Preferred Stock	0	(156,753)
Payments of cash dividends on Series A Preferred Stock	0	(12,679)
Payments to repurchase and retire Common Stock	(4,740)	0
Payments for treasury stock	0	(1,116)
Principal payments on capital leases	(235)	(330)
Proceeds from exercise of employee stock options	965	5,044
Net cash used in financing activities	(12,412)	(25,990)
Effect of foreign currency translation changes	(11,050)	(4,838)
Net change in cash, cash equivalents and restricted cash	(997)	15,531
Cash, cash equivalents and restricted cash at beginning of period	119,990	87,909
Cash, cash equivalents and restricted cash at end of period	118,993	103,440
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest	2,195	524
Cash paid for income taxes	1,886	3,053
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Underwriter discounts and commissions	0	2,948
Underwriter expenses	0	1,050
Accrued professional fees related to the issuance of Common Stock	0	27
Accrued cash dividends	0	0
Accrued PIK dividends	0	0
Accretion of discount on Series A Preferred Stock	0	2,277
Issuance of Series A Preferred Stock for PIK dividends	0	2,891
Increase in payables for debt issuance costs	0	145
Increase in principal related to the Credit Facility discount	0	28
Decrease in payables for capital expenditures	$ (2)	$ 0

NATURE OF BUSINESS AND BASIS OF PRESENTATION	9 Months Ended
NATURE OF BUSINESS AND BASIS OF PRESENTATION	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF BUSINESS AND BASIS OF PRESENTATION	NATURE OF BUSINESS AND BASIS OF PRESENTATION Nature of Business Rimini Street, Inc. (the “Company”) is a global provider of enterprise software support services. The Company’s subscription-based software support products and services offer enterprise software licensees a choice of solutions that replace or supplement the support products and services offered by enterprise software vendors. Basis of Presentation and Consolidation The Unaudited Condensed Consolidated Financial Statements, which include the accounts of the Company and its wholly-owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All significant intercompany balances and transactions have been eliminated. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, certain information and footnote disclosures required by U.S. GAAP for complete financial statements have been condensed or omitted in accordance with such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the Unaudited Condensed Consolidated Financial Statements have been included. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements for the year ended December 31, 2021, included in the Company’s 2021 Annual Report on Form 10-K as filed with the SEC on March 2, 2022 (the “2021 Form 10-K”). The accompanying Unaudited Condensed Consolidated Balance Sheet and related disclosures as of December 31, 2021 have been derived from the Company’s audited financial statements. The Company’s financial condition as of September 30, 2022, and operating results for both the three and nine months ended September 30, 2022, are not necessarily indicative of the financial condition and results of operations that may be expected for any future interim period or for the year ending December 31, 2022.

LIQUIDITY AND SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
LIQUIDITY AND SIGNIFICANT ACCOUNTING POLICIES	Sep. 30, 2022
Accounting Policies [Abstract]
LIQUIDITY AND SIGNIFICANT ACCOUNTING POLICIES	LIQUIDITY AND SIGNIFICANT ACCOUNTING POLICIES Liquidity As of September 30, 2022, the Company’s current liabilities exceeded its current assets by $61.6 million, and the Company recorded a net loss of $0.4 million for the three months ended September 30, 2022. As of September 30, 2022, the Company had available cash, cash equivalents and restricted cash of $119.0 million and short-term investments of $11.1 million. As of September 30, 2022, the Company’s current liabilities included $212.1 million of deferred revenue whereby the historical costs of fulfilling the Company's commitments to provide services to its clients was approximately 39% of the related deferred revenue for the three months ended September 30, 2022. On July 20, 2021, the Company redeemed the remaining 87,802 shares of its 13.00% Series A Redeemable Convertible Preferred Stock (“Series A Preferred Stock”) at an aggregate total redemption price of $88.4 million. The total redemption price consisted of $87.8 million related to the outstanding shares of Series A Preferred Stock with a face value of $1,000 per share and $0.6 million or $6.86 per share of Series A Preferred Stock related to the dividends earned for the period from July 1, 2021 through July 19, 2021. The redeemed shares of the Series A Preferred Stock, along with the dividends, were recorded on the redemption date of July 20, 2021. The Company funded the July 20, 2021 redemption with borrowings from a five-year term loan of $90 million, which was entered into on July 20, 2021 (the “Credit Facility”). Annual minimum principal payments over the five year term for the Credit Facility are 5%, 5%, 7.5%, 7.5% and 10%, respectively, with the remaining balance due at the end of the term. See Note 5 for further information regarding the Company's Credit Facility. As discussed in Note 7, the Company completed a firm commitment underwritten public offering on March 11, 2021 (the “March 2021 Offering”) of 7.8 million shares of its common stock, par value $0.0001 per share (“Common Stock”), at a price of $7.75 per share for total gross proceeds of $57.0 million. Underwriter discounts and commissions were $2.9 million and the underwriter expenses were $0.2 million. The Company also incurred additional professional fees and expenses of $1.3 million as part of the transaction, resulting in net proceeds from the March 2021 Offering of approximately $55.6 million. The Company had previously completed a firm commitment underwritten public offering on August 18, 2020 (the “August 2020 Offering”) of 6.1 million shares of its Common Stock at a price of $4.50 per share for total gross proceeds of $27.5 million. Underwriter discounts and commissions were $1.7 million and the underwriter expenses were $0.1 million. The Company also incurred additional professional fees of $0.6 million as part of the transaction, resulting in net proceeds from the August 2020 Offering of approximately $25.1 million. Additionally, the Company is obligated to make operating and financing lease payments that are due within the next 12 months in the aggregate amount of $6.0 million. During the third quarter of 2022, the U.S. economy has continued to experience rising interest rates and inflationary pressures due in part to global supply chain issues, a rise in energy prices and the continuing effects of fiscal and monetary policies adopted by governments in response to the global outbreak of a novel strain of the coronavirus (“COVID-19”) that was declared by the World Health Organization to be a pandemic in March 2020. As of the issuance date of these financial statements, the Company’s ability to operate continues not to be significantly adversely impacted by the COVID-19 pandemic or related changes in the macroeconomic environment, and the Company believes that current cash, cash equivalents, restricted cash, and future cash flow from operating activities will be sufficient to meet the Company’s anticipated cash needs, including Credit Facility repayments, working capital needs, capital expenditures and other contractual obligations for at least 12 months from the issuance date of these financial statements. Use of Estimates The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires the Company to make judgments, assumptions, and estimates that affect the amounts reported in its consolidated financial statements and accompanying notes. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes are reasonable under the circumstances to determine the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s accounting estimates include, but are not necessarily limited to, valuation of accounts receivable, valuation assumptions for stock options and leases, deferred income taxes and the related valuation allowances, and the evaluation and measurement of contingencies. To the extent there are material differences between the Company’s estimates and actual results, the Company’s future consolidated results of operation may be affected. Recent Accounting Pronouncements Recently Adopted Standards. The following accounting standards were adopted during fiscal year 2022: In August 2020, the FASB issued ASU 2020-6, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40). The guidance eliminates the beneficial conversion and cash conversion accounting for convertible instruments. The new guidance also modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The new guidance was effective for us as of January 1, 2022. The impact of the adoption of this guidance did not have a material impact on our Unaudited Condensed Consolidated Financial Statements.

INCOME TAXES	9 Months Ended
INCOME TAXES	Sep. 30, 2022
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”) was signed into law. The IRA includes a 15% corporate alternative minimum tax for companies that report over $1 billion in U.S. profits to shareholders and a 1% excise tax on stock buy backs. The Company does not expect the IRA to have a material tax impact. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was passed into law, amending portions of relevant U.S. tax laws. The CARES Act contains changes to corporate taxation, including among other things, adjusting net operating loss (NOL) limitations and carryback rules, refundable AMT credits, bonus depreciation and interest expense limitations. The CARES Act also provides for an Employee Retention Credit, a fully refundable payroll tax credit for certain eligible employers and the ability for all eligible employers to defer payment of the employer share of payroll taxes owed on wages paid for the period ending December 31, 2020 (such deferred payroll taxes are due in two installments: 50% by December 31, 2021 and 50% by December 31, 2022). The Company elected to defer payroll tax payments which totaled $1.6 million as of September 30, 2022. The Company paid $1.6 million in December 2021 as required under the CARES Act. The remaining amount of $1.6 million is required to be paid in December 2022. For the three months ended September 30, 2022 and 2021, the Company’s effective tax rate was 12.1% and 47.2%, respectively. For the nine months ended September 30, 2022 and 2021, the Company’s effective tax rate was 65.1% and 45.0%, respectively. The Company’s income tax expense was primarily attributable to earnings in the United States and foreign jurisdictions subject to income taxes and foreign withholding taxes. The Company did not have any material changes to its conclusions regarding valuation allowances for deferred income tax assets or uncertain tax positions for the three and nine months ended September 30, 2022 and 2021. Given the near-break even results projected results for fiscal year 2022, the Company determined that any changes in pretax income would result in a significant impact on the estimated annual effective tax rate. As a result, the Company utilized the year-to-date effective tax rate as the estimated annual effective tax rate when determining the income taxes recorded during the three and nine months ended September 30, 2022, For additional information about income taxes, please refer to Note 9 to the Company’s Consolidated Financial Statements for the year ended December 31, 2021, included in Part II, Item 8 of the 2021 Form 10-K.

COMMITMENTS AND CONTINGENCIES	9 Months Ended
COMMITMENTS AND CONTINGENCIES	Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Retirement Plan The Company has defined contribution plans for both its U.S. and foreign employees. For certain of these plans, employees may contribute up to the statutory maximum, which is set by law each year. The plans also provide for employer contributions. For the three months ended September 30, 2022 and 2021, the Company’s matching contributions to these plans totaled $0.8 million for both years. For the nine months ended September 30, 2022 and 2021, the Company’s matching contributions to these plans totaled $2.7 million and $2.5 million, respectively. Rimini I Litigation In January 2010, certain subsidiaries of Oracle Corporation (together with its subsidiaries individually and collectively, “Oracle”) filed a lawsuit, Oracle USA, Inc. et al. v. Rimini Street, Inc. et al. (United States District Court for the District of Nevada) (the “District Court”) (“Rimini I”), against the Company and its Chief Executive Officer, Seth Ravin, alleging that certain of the Company’s processes (Process 1.0) violated Oracle’s license agreements with its customers and that the Company committed acts of copyright infringement and violated other federal and state laws. The litigation involved the Company’s business processes and the manner in which the Company provided services to its clients. After completion of a jury trial in 2015 and subsequent appeals, the final outcome of Rimini I was that Mr. Ravin was found not liable for any claims and the Company was found liable for only one claim: “innocent infringement,” a jury finding that the Company did not know and had no reason to know that its former support processes were infringing. The jury also found that the infringement did not cause Oracle to suffer lost profits. The Company was ordered to pay a judgment of $124.4 million in 2016, which the Company promptly paid and then pursued appeals. With interest, attorneys’ fees and costs, the total judgment paid by the Company to Oracle after the completion of all appeals was approximately $89.9 million. A portion of such judgment was paid by the Company’s insurance carriers. Injunction Proceedings Since November 2018, the Company has been subject to a permanent injunction prohibiting it from using certain support processes that had been found in Rimini I to “innocently” infringe certain Oracle copyrights. The injunction does not prohibit the Company’s provision of support services for any Oracle product lines, but rather defines the manner in which the Company can provide support services for certain Oracle product lines. On July 10, 2020, Oracle filed a motion to show cause contending that the Company was in violation of the injunction, and the Company opposed this motion, disputing Oracle’s claims. On January 12, 2022, the District Court issued its findings and order following an evidentiary hearing held in September 2021 regarding whether the Company (i) violated the injunction for certain accused conduct and (ii) should be held in contempt in those instances where the District Court found a violation of the injunction, and what sanctions, if any, are appropriate. In the order, the District Court ruled in favor of the Company with respect to five of the items. With respect to the other five items, the District Court found the Company violated the permanent injunction, awarded sanctions to Oracle of $0.6 million and ordered that certain computer files be quarantined from use and notice and proof of such quarantining be provided to Oracle. The District Court also ruled that Oracle may recover its reasonable attorneys’ fees and costs. The Company reserves all rights, including appellate rights, with respect to the District Court rulings and findings. On February 7, 2022, Rimini filed a notice of appeal in the District Court, commencing an appeal of the District Court’s January 12, 2022 decision to the Ninth Circuit Court of Appeals (“Court of Appeals”). On February 8, 2022, the District Court stayed the briefing on Oracle’s bill of attorneys’ fees and costs until Rimini’s appeal is resolved. Briefing on Rimini’s appeal has been completed, and the parties are currently working with the Court of Appeals to schedule oral argument on the appeal in early 2023. At this time, the Company believes that it is in substantial compliance with the injunction and has complied with the order regarding the quarantining of certain computer files. As of September 30, 2022 and December 31, 2021, the Company had accrued $6.9 million, as an estimate related to reasonable attorneys’ fees and costs. During the nine months ended September 30, 2022, the Company paid $0.6 million to Oracle for the award sanctions. Regarding the Company’s estimate for reasonable attorneys’ fees and costs, significant judgment is required to determine the amount of loss related to this matter as the outcome is inherently unpredictable and subject to uncertainties. Rimini II Litigation In October 2014, the Company filed a separate lawsuit, Rimini Street Inc. v. Oracle Int’l Corp., in the District Court against Oracle seeking a declaratory judgment that the Company’s revised “Process 2.0” support practices, in use since at least July 2014, do not infringe certain Oracle copyrights (“Rimini II”). The Company’s operative complaint asserts declaratory judgment, tort, and statutory claims. Oracle’s operative counterclaim asserts declaratory judgment and copyright infringement claims and Lanham Act, breach of contract, and business tort violations. On September 15, 2020, the District Court issued an order resolving the parties’ motions for summary judgment. It found infringement of 17 Oracle PeopleSoft copyrights for work the Company performed for a set of “gap customers” that were supported by processes litigated in Rimini I, and that became the Company’s customers after Rimini I was filed. The District Court also found infringement of four Oracle PeopleSoft copyrights involving support of two specific Company clients, described by the District Court as “limited cases” and involving “limited circumstance[s].” There was no finding of infringement on any other Oracle copyrights at issue. The order also resolved several of the non-copyright claims asserted by the parties: (i) allowing the Company’s claim for injunctive relief against Oracle for unfair competition in violation of the California Business & Professions Code §17200 et seq. to proceed to trial; (ii) granting summary judgment for Oracle on the Company’s affirmative claims for damages under the Nevada and California unfair and deceptive trade practices statutes; and (iii) holding that Oracle had the right to revoke the Company’s access to its websites. The Court also reiterated that the Company has the legal right to provide aftermarket support for Oracle’s enterprise software. The parties filed their joint pretrial order in Rimini II in December 2020. On September 3, 2021, the District Court granted Oracle’s motion to realign the parties with Oracle now designated as plaintiff and the Company and Mr. Ravin now designated as the defendants in the case caption and at trial. The District Court also granted Oracle’s motion to bifurcate the trial – originally providing for a jury trial on Oracle’s monetary damages claims against the Company, followed by a separate bench trial on the parties’ equitable claims for unfair competition and Oracle’s claim for an accounting. On April 14, 2022, the District Court judge who had previously presided over the case entered an order referring the case for reassignment, resulting in the case being reassigned to another District Court judge. During a status conference with the District Court on October 14, 2022, attorneys for Oracle confirmed that Oracle would withdraw all of its monetary damages claims against the Company in Rimini II and proceed with a bench trial instead of a jury trial for its claims for equitable relief. Further, in accordance with a Minute Order issued by the District Court on October 14, 2022, good cause appearing, the start date for the Rimini II trial was changed from November 2, 2022 to November 29, 2022 in Las Vegas. As ordered by the District Court, on October 21, 2022, the parties filed a joint stipulation (the “Stipulation”) to dismiss with prejudice the Rimini II claims affected by Oracle’s decision, including all of Oracle’s monetary damages claims against the Company and Mr. Ravin. On October 24, 2022, the District Court entered an order granting the Stipulation, dismissing with prejudice Oracle’s claims in Rimini II “for monetary relief of any kind under any legal theory [,] including but not limited to claims for damages, restitution, unjust enrichment, and engorgement [ . . . ].” In addition, Oracle’s claims for breach of contract, inducing breach of contract and an accounting were dismissed with prejudice. Per the Stipulation, the parties have each reserved the right to seek attorneys’ fees and/or costs to the extent permissible by law. Prior to the date of the District Court’s order granting the Stipulation, no damages of any kind were awarded by the District Court in Rimini II. Whether to award any attorneys’ fees and/or costs will be a decision for the District Court. At this time, the Company does not have sufficient information regarding the possible recovery by Oracle of its attorneys’ fees and/or costs in the Rimini II litigation. The Company maintains that Oracle should not be permitted to recover its attorneys’ fees and/or costs. Both parties have sought injunctive relief in this matter, and the Company has reserved its rights to appeal regarding the possible recovery of damages by the Company in connection with the Company’s claims against Oracle. As a result, an estimate of the range of loss, if any, cannot be reasonably determined. The Company also believes that an award of Oracle’s attorneys’ fees and/or costs is not probable, so no accrual has been made as of September 30, 2022. However, the ultimate outcome may be different from the Company’s best estimates and could have a material adverse impact on the Company’s financial results and business. The Company reserves all rights, including appellate rights, with respect to the District Court’s rulings and findings in Rimini II. Other Litigation From time to time, the Company may be a party to litigation and subject to claims incident to the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on its business. Regardless of the outcome, litigation can have an adverse impact on the Company because of judgment, defense and settlement costs, diversion of management resources and other factors. At each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, Contingencies. Legal fees are expensed as incurred. Liquidated Damages The Company enters into agreements with clients that contain provisions related to liquidated damages that would be triggered in the event that the Company is no longer able to provide services to these clients. The maximum cash payments related to these liquidated damages is approximately $9.4 million and $8.3 million as of September 30, 2022 and December 31, 2021, respectively. To date, the Company has not incurred any costs as a result of such provisions and has not accrued any liabilities related to such provisions in these Unaudited Condensed Consolidated Financial Statements.

RELATED PARTY TRANSACTIONS	9 Months Ended
RELATED PARTY TRANSACTIONS	Sep. 30, 2022
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS Rimini Street, Inc. (“RSI”) was incorporated in the state of Nevada in September 2005. In May 2017, RSI entered into an Agreement and Plan of Merger (the “Merger Agreement”) with GP Investments Acquisition Corp. (“GPIA”), a publicly-held special purpose acquisition company (“SPAC”) incorporated in the Cayman Islands and formed for the purpose of effecting a business combination with one or more businesses. The Merger Agreement was approved by the respective shareholders of RSI and GPIA in October 2017, and closing occurred on October 10, 2017, resulting in (i) the merger of a wholly-owned subsidiary of GPIA with and into RSI, with RSI as the surviving corporation, after which (ii) RSI merged with and into GPIA, with GPIA as the surviving corporation and renamed “Rimini Street, Inc.” (referred to herein as “RMNI”, as distinguished from RSI, which is defined as the predecessor entity with the same legal name) immediately after consummation of the second merger. Prior to the consummation of the mergers, the ultimate parent entity of GPIA was GP Investments, Ltd. (“GP Investments”), a global private equity firm and a former affiliate of the Company. An affiliate of GP Investments was a member of the Company’s Board of Directors until May 5, 2021.In addition, an affiliate of Adams Street Partners and its affiliates (collectively referred to as “ASP”) is also a member of the Company’s Board of Directors. As of September 30, 2022, ASP owned approximately 26.7% of the Company’s issued and outstanding shares of Common Stock. In July 2018, ASP acquired 19,209 shares of Series A Preferred Stock and approximately 0.4 million shares of Common Stock for total consideration of approximately $19.2 million, all of which shares of Series A Preferred Stock were redeemed by the Company in 2021 on the same terms and conditions as for all other holders of Series A Preferred Stock.

LIQUIDITY AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2022
Accounting Policies [Abstract]
Nature of Business	Nature of Business Rimini Street, Inc. (the “Company”) is a global provider of enterprise software support services. The Company’s subscription-based software support products and services offer enterprise software licensees a choice of solutions that replace or supplement the support products and services offered by enterprise software vendors.
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation The Unaudited Condensed Consolidated Financial Statements, which include the accounts of the Company and its wholly-owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All significant intercompany balances and transactions have been eliminated. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, certain information and footnote disclosures required by U.S. GAAP for complete financial statements have been condensed or omitted in accordance with such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the Unaudited Condensed Consolidated Financial Statements have been included. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements for the year ended December 31, 2021, included in the Company’s 2021 Annual Report on Form 10-K as filed with the SEC on March 2, 2022 (the “2021 Form 10-K”). The accompanying Unaudited Condensed Consolidated Balance Sheet and related disclosures as of December 31, 2021 have been derived from the Company’s audited financial statements. The Company’s financial condition as of September 30, 2022, and operating results for both the three and nine months ended September 30, 2022, are not necessarily indicative of the financial condition and results of operations that may be expected for any future interim period or for the year ending December 31, 2022.
Use of Estimates	Use of Estimates The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires the Company to make judgments, assumptions, and estimates that affect the amounts reported in its consolidated financial statements and accompanying notes. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes are reasonable under the circumstances to determine the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s accounting estimates include, but are not necessarily limited to, valuation of accounts receivable, valuation assumptions for stock options and leases, deferred income taxes and the related valuation allowances, and the evaluation and measurement of contingencies. To the extent there are material differences between the Company’s estimates and actual results, the Company’s future consolidated results of operation may be affected.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Recently Adopted Standards. The following accounting standards were adopted during fiscal year 2022: In August 2020, the FASB issued ASU 2020-6, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40). The guidance eliminates the beneficial conversion and cash conversion accounting for convertible instruments. The new guidance also modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The new guidance was effective for us as of January 1, 2022. The impact of the adoption of this guidance did not have a material impact on our Unaudited Condensed Consolidated Financial Statements.
Earnings Per Share	The Company computes earnings per share in accordance with ASC Topic 260, Earnings per Share, which requires earnings per share for each class of stock to be calculated using the two-class method. The holders of Series A Preferred Stock were entitled to participate in Common Stock dividends, if and when declared, on a one-to-one per-share basis. Accordingly, in prior year periods in which the Company had net income, earnings per share were computed using the two-class method whereby the pro rata dividends on Common Stock that were also distributable to the holders of Series A Preferred Stock would have been deducted from earnings applicable to common stockholders, regardless of whether a dividend is declared for such undistributed earnings. Under the two-class method, earnings for the reporting period were allocated between the holders of the Company’s Common Stock and the Series A Preferred Stock based on their respective participation rights in undistributed earnings. Basic earnings per share of Common Stock is computed by dividing net income attributable to common stockholders by the weighted average number of shares of basic Common Stock outstanding. Net income allocated to the holders of the Company’s Series A Preferred Stock is calculated based on the stockholders’ proportionate share of the weighted average shares of Common Stock outstanding on an if-converted basis. Diluted earnings per share of Common Stock is calculated by adjusting the basic earnings per share of Common Stock for the effects of potential dilutive Common Stock shares outstanding such as stock options, restricted stock units and warrants.