Consolidated Financial Statements of ABSOLUTE SOFTWARE CORPORATION As at June 30, 2021 and 2020 Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Absolute Software Corporation Opinion on the Financial Statements We have audited the accompanying consolidated statements of financial position of Absolute Software Corporation and subsidiaries (the “Company”) as at June 30, 2021 and 2020, the related consolidated statements of operations and comprehensive income, changes in shareholders’ deficiency and cash flows, for each of the two years in the period ended June 30, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as at June 30, 2021 and 2020, and its financial performance and its cash flows for each of the two years in the period ended June 30, 2021, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion /s/ Deloitte LLP Chartered Professional Accountants Vancouver, Canada August 10, 2021 We have served as the Company’s auditors since 2003. ABSOLUTE SOFTWARE CORPORATION Consolidated Statements of Financial Position June 30, 2021 and 2020 (Expressed in thousands of United States dollars) June 30, 2021 June 30, 2020 Assets Current assets: Cash and cash equivalents (note 14) $ 140,166 $ 29,727 Short-term investments (note 3) 360 17,350 Trade and other receivables (note 4) 24,113 28,990 Income tax receivable 628 112 Prepaid expenses and other (note 5) 5,802 2,542 Contract acquisition assets – current (note 6) 8,253 7,501 179,322 86,222 Property and equipment (note 7) 4,629 5,563 Right-of-use assets (note 8) 9,967 9,182 Deferred income tax assets (note 13) 31,339 22,279 Contract acquisition assets (note 6) 6,271 5,843 Goodwill 1,100 1,100 $ 232,628 $ 130,189 Liabilities Current liabilities: Trade and other payables (note 9) $ 34,116 $ 20,129 Income tax payable 20 382 Lease liabilities – current (note 10) 2,908 1,725 Deferred revenue – current (note 12(b)) 93,303 80,844 130,347 103,080 Lease liabilities (note 10) 8,960 8,411 Deferred revenue (note 12(b)) 66,879 61,760 206,186 173,251 Shareholders’ Deficiency Share capital (note 11(b)) 151,521 81,890 Equity reserve 46,489 38,524 Treasury shares (264) (264) Accumulated other comprehensive income 188 - Deficit (171,492) (163,212) 26,442 (43,062) $ 232,628 $ 130,189 Commitments and contingencies (note 18, note 20) Subsequent events (note 21) See accompanying notes to the Consolidated Financial Statements. Approved on behalf of the Board: (signed) “Daniel P. Ryan”____ (signed) “Lynn Atchison”___ Daniel P. Ryan, Director Lynn Atchison, Director ABSOLUTE SOFTWARE CORPORATION Consolidated Statements of Operations and Comprehensive Income Year ended June 30, 2021 and 2020 (Expressed in thousands of United States dollars, except number of shares and per share amounts) Years ended June 30, 2021 2020 Revenue (note 12) $ 120,784 $ 104,671 Cost of revenue 15,869 13,090 Gross margin 104,915 91,581 Operating expenses Sales and marketing 45,584 40,207 Research and development 23,264 19,441 General and administration 30,438 16,667 99,286 76,315 Operating income 5,629 15,266 Other (expense) income Finance (expense) income, net (30) 395 Interest expense – lease liability (552) (619) Foreign exchange (loss) gain (690) 200 (1,272) (24) Net income before income taxes 4,357 15,242 Income tax expense (note 13) (625) (4,607) Net income $ 3,732 $ 10,635 Unrealized gain on derivatives, net of tax 188 - Net income and total comprehensive income $ 3,920 $ 10,635 Basic net income per common share (note 11(j)) $ 0.08 $ 0.25 Diluted net income per common share (note 11(j)) $ 0.07 $ 0.24 Weighted average number of common shares outstanding Basic 47,131,785 42,137,720 Diluted 49,916,511 44,746,451 See accompanying notes to the Consolidated Financial Statements. ABSOLUTE SOFTWARE CORPORATION Consolidated Statements of Changes in Shareholders’ Deficiency Year ended June 30, 2021 and 2020 (Expressed in thousands of United States dollars, except number of shares) Share Capital Accumulated Number of Other Common Equity Treasury Comprehensive shares Amount reserve shares Income Deficit Total Balance, June 30, 2019 41,645,552 $ 76,778 $ 36,745 $ (360) $ - $ (163,779) $ (50,616) Shares issued on stock option exercise 286,268 2,062 (416) - - - 1,646 Shares issued under Employee Share Purchase Plan 72,023 369 - - - - 369 Shares issued under Performance and Restricted Share Unit plan (“PRSU”) 540,352 2,697 (2,795) 96 - - (2) Shares repurchased and cancelled under the Normal Course Issuer Bid (8,700) (16) - - - (33) (49) Share-based compensation - - 4,990 - - - 4,990 Cash dividends - - - - - (10,035) (10,035) Net income - - - - - 10,635 10,635 Balance, June 30, 2020 42,535,495 $ 81,890 $ 38,524 $ (264) $ - $ (163,212) $ (43,062) Shares issued for cash (Note 11(b)) 6,272,727 69,000 - - - - 69,000 Share issuance cost - (4,228) - - - - (4,228) Shares issued on stock option exercise 106,844 805 (149) - - - 656 Shares issued under Employee Stock Ownership Plan 68,089 512 - - - - 512 Shares issued under PRSU 590,674 3,542 (4,781) - - - (1,239) Share-based compensation - - 8,539 - - - 8,539 Cash dividends - - - - - (12,012) (12,012) Unrealized gain on derivatives, net - - - - 188 - 188 Tax deduction on share-based compensation - - 4,356 - - - 4,356 Net income - - - - - 3,732 3,732 Balance, June 30, 2021 49,573,829 $ 151,521 $ 46,489 $ (264) $ 188 $ (171,492) $ 26,442 See accompanying notes to the Consolidated Financial Statements. ABSOLUTE SOFTWARE CORPORATION Consolidated Statements of Cash Flows Years ended June 30, 2021 and 2020 (Expressed in thousands of United States dollars) Years ended June 30, 2021 2020 Cash from (used in): Operating activities: Net income $ 3,732 $ 10,635 Items not involving cash: Depreciation of property and equipment (note 7) 3,220 3,385 Amortization of right-of-use assets (note 8) 2,486 1,930 Amortization of contract acquisition assets (note 6) 10,980 8,594 Share-based compensation (note 11(g)) 10,359 6,772 Deferred income taxes (4,444) 80 Current income taxes 765 - Gain on early termination of operating lease (26) - Interest 515 - Unrealized gain on short-term investments - (278) Unrealized foreign exchange loss (gain) 654 (297) Change in non-cash working capital: Trade and other receivables 4,877 (6,796) Income tax receivable (516) 596 Prepaid expenses and other (1,692) 547 Contract acquisition assets (12,159) (10,032) Trade and other payables 10,869 1,276 Income tax payable (363) 368 Deferred revenue 17,579 8,175 Cash from operating activities 46,836 24,955 Investing activities: Purchase of property and equipment (2,834) (3,856) Lease incentive received 68 - Proceeds from maturities of short-term investments 17,027 42,913 Purchase of short-term investments - (42,877) Cash from (used in) investing activities: 14,261 (3,820) Financing activities: Dividends paid (note 11(i)) (12,012) (10,035) Proceeds from public offering (note 11(b)) 69,000 - Share issuance costs (note 11(b)) (5,323) - Proceeds from exercise of stock options (note 11(c)) 656 1,646 Proceeds from Employee Stock Ownership Plan (note 11(f)) 950 444 Tax remittances on share-based compensation (1,239) - Repurchase of common shares for cancellation - (49) Payment of lease liabilities (note 10) (2,788) (1,732) Cash from (used in) financing activities: 49,244 (9,726) Foreign exchange effect on cash 98 (373) Increase in cash and cash equivalents 110,439 11,036 Cash and cash equivalents, beginning of year 29,727 18,691 Cash and cash equivalents, end of year $ 140,166 $ 29,727 Supplemental cash flow information (note 14) See accompanying notes to the Consolidated Financial Statements. ABSOLUTE SOFTWARE CORPORATION Notes to the Consolidated Financial Statements Years ended June 30, 2021 and 2020 (Tabular amounts in thousands of United States dollars, except per share amount and number of shares) 1.