What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2022-02-11 compared with 2021-02-10 · 411 added, 452 removed, 618 unchanged (58% of the section changed)

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of DHI Group, Inc.

To the stockholders and the Board of Directors of DHI Group, Inc.

Opinion on the Financial Statements

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We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 11, 2022, expressed an unqualified opinion on the Company's internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 7 to the financial statements, the Company changed its method of accounting for leases in 2019 due to the adoption of ASU No.

2016-02, Leases , under the modified retrospective method.

Basis for Opinion

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

Critical Audit Matter

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

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

Goodwill and Acquired Intangible Assets, Net – Impairment of Goodwill and Dice Trademarks and Brand Name - Refer to Notes 2, 9, and 10 to the financial statements

Critical Audit Matters

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

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

Discontinued Operations - Transfer of majority interest in eFinancialCareers– Refer to Notes 1 and 4 to the financial statements

Critical Audit Matter Description

On June 30, 2021, the Company transferred majority ownership and control of its eFinancialCareers business (“eFC”) to eFC management, while retaining a 40% common share interest (the “eFC Transaction”).

As a result, eFC was deconsolidated as of June 30, 2021 and is reflected as a discontinued operation.

The deconsolidation and related evaluation of the loss of control required significant accounting judgments.

This required a high degree of auditor judgment and increased level of effort when performing audit procedures to evaluate the reasonableness of management’s judgments.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the deconsolidation of eFC included the following, among others:

• We tested the effectiveness of controls over the accounting and reporting for significant non-recurring transactions, which included the deconsolidation of eFC.

• With the assistance of firm specialists having expertise in consolidation accounting, we evaluated management’s accounting judgments related to the deconsolidation of eFC.

• We evaluated the presentation and disclosure of the eFC Transaction in the financial statements.

Goodwill – Refer to Notes 2, 4 and 11 to the financial statements

Critical Audit Matter Description

The Company determines whether the carrying value of recorded goodwill is impaired on an annual basis or more frequently if indicators of potential impairment exist.

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Determining the fair value of a reporting unit is judgmental in nature and requires the use of estimates and key assumptions, particularly assumed discount rates and projections of future operating results, such as forecasted revenues and earnings before interest, taxes, depreciation and amortization (EBITDA) margins.

Changes in these assumptions could have a significant impact on either the fair value, the amount of the

goodwill impairment charge, or both.

The amount of goodwill as of December 31, 2020 was $133.4 million.

During 2020, the Company recognized a $23.6 million goodwill impairment charge as the fair value of the reporting unit was lower than its carrying value.

The Company determines whether the carrying value of recorded indefinite-lived acquired intangible assets, which consists entirely of the Dice trademarks and brand name, is impaired on an annual basis or more frequently if indicators of potential impairment exist.

The impairment review process compares the fair value of the Dice trademarks and brand name to their carrying value.

If the carrying value exceeds the fair value, an impairment loss is recorded.

The Company utilizes a relief from royalty rate method to value the Dice trademarks and brand name, which involves a significant level of judgment in the assumptions underlying the approach used to determine the fair value, including the revenue growth rate, royalty rate, and discount rate.

Changes in these assumptions could have a significant impact on either the fair value, the amount of the trademarks and brand name impairment charge, or both.

The amount of acquired intangible assets as of December 31, 2020 was $23.8 million.

During 2020, the Company recognized a $15.2 million trademarks and brand name impairment charge as the fair value of the trademarks and brand name was lower than their carrying value.

Given the significant judgments made by management to estimate the fair value of the reporting unit and the goodwill impairment charge recorded during the year, performing auditing procedures to evaluate the reasonableness of management’s judgments regarding the business and valuation assumptions utilized in the valuation models, particularly the forecasts of future revenue and EBITDA margins and the selection of the discount rate, required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

In addition, given the determination of the fair values of the Dice trademarks and brand name and the impairment charges recorded during the year required management to make significant estimates and assumptions relating to the forecasts of future revenue and the selection of the royalty and discount rates, performing audit procedures to evaluate the reasonableness of such estimates and assumptions, particularly the forecasts of future revenue and the selection of the discount rate and royalty rate, required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

Changes in these assumptions could have a significant impact on the determination of fair value.

On June 30, 2021, the Company transferred a majority interest of eFC, which was part of the Tech-focused reporting unit, to eFC management.

In order to account for the eFC Transaction and allocate the reporting unit goodwill, the Company performed an interim valuation analysis to determine the fair value of eFC and the continuing business as of June 30, 2021.

The Company allocated $5.3 million and $128.1 million of goodwill to eFC and the continuing business, respectively, using a relative fair value approach.

Given the significant judgments made by management to determine the relative fair value of, and goodwill allocated to, eFC and the continuing business, performing auditing procedures to evaluate the reasonableness of management’s judgments regarding the business and valuation assumptions utilized in the valuation models, particularly the forecasts of future revenue and EBITDA margins and the selection of the discount rates, required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the forecasts of future revenues and EBITDA margins and selection of the royalty rate and discount rates used by management to estimate the fair value of the reporting unit and the Dice trademarks and brand name included the following, among others:

• We tested the effectiveness of controls over management’s impairment evaluation of the reporting unit and acquired intangible assets, including those controls related to management’s forecasts of future revenues and expenses and selection of the royalty rate and discount rates.

• We evaluated management’s ability to accurately forecast future revenues and expenses by comparing actual revenues and expenses to management’s historical forecasts.

• We evaluated the reasonableness of management’s revenues and expenses forecast by comparing the forecasts with:

◦ Historical revenues and expenses and forecasted information in industry reports.

Our audit procedures related to the forecasts of future revenues and EBITDA margins and selection of the discount rates used by management to estimate the fair value of eFC and the continuing business included the following, among others:

• We tested the effectiveness of controls over management’s determination of the fair value of eFC and the continuing business, including controls related to management’s forecasts of future revenues and EBITDA margins and selection of the discount rates.

• We tested the allocation of goodwill to eFC and the continuing business based on the weighting of the relative fair value.

• We evaluated the reasonableness of management’s forecasts of future revenues and EBITDA margins by comparing the forecasts with:

◦ Historical revenues and EBITDA margins and forecasted information in industry reports.

◦ Internal communications to management and the Board of Directors.

• With the assistance of our fair value specialists, we evaluated the reasonableness of the (1) valuation methodology and (2) valuation assumptions (discount rates and royalty rate) by:

• With the assistance of our fair value specialists, we evaluated the reasonableness of the (1) valuation methodology and (2) valuation assumptions, including the discount rates, by:

◦ Testing the source information underlying the determination of the assumption and testing the mathematical accuracy of the calculation.

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CONSOLIDATED BALANCE SHEETS

As of December 31, 2020 and 2019

(in thousands, except per share data)

As of December 31, 2021 and 2020 (in thousands, except per share data)

2021 December 31, 2020

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Prepaid and other current assets 4,177 4,101

Current assets of discontinued operations — 8,175

Total current assets 24,456 33,485

Fixed assets, net 20,581 23,033

Acquired intangible assets 23,800 39,000

Capitalized contract costs 9,131 6,189

Goodwill 133,353 156,059

Deferred income taxes 19 7

Operating lease right-of-use assets 6,888 10,804

Investments 3,769 —

Investments, at fair value 3,000 —

Acquired intangible assets 23,800 23,800

Goodwill 128,100 128,100

Other assets 1,853 1,378

Non-current assets of discontinued operations — 14,198

Total assets $ 221,578 $ 240,987

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Accounts payable and accrued expenses $ 15,859 $ 15,308

Operating lease liabilities 3,410 3,643

Deferred revenue 45,217 35,547

Income taxes payable 123 984

Operating lease liabilities 2,388 2,075

Current liabilities of discontinued operations — 12,455

Total current liabilities 63,464 65,385

Deferred revenue 929 1,035

Operating lease liabilities 6,982 9,371

Long-term debt, net 22,730 19,583

Deferred income taxes 9,315 9,765

Deferred revenue 1,068 1,058

Accrual for unrecognized tax benefits 785 941

Operating lease liabilities 13,704 16,664

Other long-term liabilities 1,011 2,049

Non-current liabilities of discontinued operations — 5,288

Total liabilities 105,216 113,417

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Total liabilities and stockholders’ equity $ 221,578 $ 240,987

See accompanying notes to the consolidated financial statements.

See accompanying notes to consolidated financial statements.

DHI GROUP, INC.

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Depreciation 16,344 10,259 8,428

Amortization of intangible assets — — 482

Impairment of intangible assets — 15,200 —

Impairment of goodwill — 22,607 —

Impairment of right-of-use asset 1,919 — —

Disposition related and other costs (Note 16) — — 1,414

Total operating expenses 121,655 143,557 106,607

Other operating income (loss):

Gain (loss) on sale of businesses (Note 4) — ( 537 ) 3,369

Total other operating income (loss) — ( 537 ) 3,369

Loss on sale of business (Note 6) — — ( 537 )

Operating income (loss) ( 1,752 ) ( 32,390 ) 10,128

Income from equity method investment 190 — —

Interest expense and other ( 667 ) ( 831 ) ( 703 )

Impairment of equity investment ( 2,002 ) — —

Other expense — — ( 36 )

Impairment of investment — ( 2,002 ) —

Gain on investment 1,198 — —

Income (loss) before income taxes ( 1,031 ) ( 35,223 ) 9,425

Income tax expense (benefit) ( 629 ) ( 2,826 ) 2,794

Income (loss) from continuing operations ( 402 ) ( 32,397 ) 6,631

Income (loss) from discontinued operations, net of tax ( 29,340 ) 2,382 5,920

Net income (loss) $ ( 29,742 ) $ ( 30,015 ) $ 12,551

Basic earnings (loss) per share - continuing operations $ ( 0.01 ) $ ( 0.67 ) $ 0.14

Diluted earnings (loss) per share - continuing operations $ ( 0.01 ) $ ( 0.67 ) $ 0.13

Basic earnings (loss) per share - discontinued operations $ ( 0.63 ) $ 0.05 $ 0.12

Diluted earnings (loss) per share - discontinued operations $ ( 0.63 ) $ 0.05 $ 0.11

Basic earnings (loss) per share $ ( 0.64 ) $ ( 0.62 ) $ 0.26

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Weighted-average diluted shares outstanding 46,333 48,278 51,633

See accompanying notes to the consolidated financial statements.

See accompanying notes to consolidated financial statements.

DHI GROUP, INC.

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Net income (loss) $ ( 29,742 ) $ ( 30,015 ) $ 12,551

Other comprehensive income (loss):

Foreign currency translation adjustment 395 729 1,988

Cumulative translation adjustments reclassified to the Statements of Operations 28,063 — —

Total other comprehensive income (loss) 28,458 729 1,988

Comprehensive income (loss) $ ( 1,284 ) $ ( 29,286 ) $ 14,539

See accompanying notes to the consolidated financial statements.

See accompanying notes to consolidated financial statements.

DHI GROUP, INC.

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Comprehensive Loss Total

Shares Issued Amount Shares Issued Amount

Shares Issued Amount Shares Issued Amount Shares Amount

Balance at January 1, 2019 — $ — 87,522 $ 876 $ 383,123 34,126 $ ( 278,843 ) $ 71,435 $ ( 31,236 ) $ 145,355

Net income 12,551 12,551

Other comprehensive loss ( 3,906 ) ( 3,906 )

Other comprehensive income 1,988 1,988

Stock based compensation 5,704 5,704

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Performance-based restricted stock units eligible to vest 449 4 4

Cumulative-effect of new accounting principle (see Note 2) 4,485 4,485

Unclaimed shareholder liability (Note 13) 980 980

Performance-based restricted stock units forfeited ( 160 ) ( 2 ) ( 2 )

Retirement of treasury stock (Note 14) ( 20,000 ) ( 200 ) ( 161,600 ) ( 20,000 ) 161,800 —

Purchase of treasury stock under stock repurchase plan 849 ( 2,519 ) ( 2,519 )

Balance at December 31, 2019 — — 69,509 696 227,227 15,591 ( 121,466 ) 83,986 ( 29,248 ) 161,195

Net income 12,551 12,551

Net loss ( 30,015 ) ( 30,015 )

Other comprehensive income 729 729

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Restricted stock issued 2,173 22 22

Restricted stock forfeited or withheld to satisfy tax obligations ( 560 ) ( 5 ) ( 1,904 ) ( 1,909 )

Performance-based restricted stock units eligible to vest 449 4 4

Purchase of treasury stock related to vested restricted and performance stock units ( 430 ) ( 4 ) 874 ( 2,248 ) ( 2,252 )

Performance-based restricted stock units forfeited ( 19 ) — —

Retirement of treasury stock (see Note 13) ( 20,000 ) ( 200 ) ( 161,600 ) 161,800 —

Purchase of treasury stock under stock repurchase plan 3,548 ( 8,436 ) ( 8,436 )

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Other comprehensive income 395 395

Cumulative translation adjustments reclassified to the Statements of Operations 28,063 28,063

Stock based compensation 8,303 8,303

Restricted stock issued 2,267 23 ( 5 ) 18

Purchase of treasury stock related to vested restricted and performance stock units ( 430 ) ( 4 ) ( 2,248 ) ( 2,252 )

Performance-based restricted stock units forfeited ( 19 ) — —

Performance-based restricted stock units eligible to vest 813 8 8

Restricted stock forfeited or withheld to satisfy tax obligations ( 685 ) ( 7 ) 2 666 ( 2,073 ) ( 2,078 )

Performance based restricted stock forfeited or withheld to satisfy tax obligations ( 44 ) — 244 ( 907 ) ( 907 )

Purchase of treasury stock under stock repurchase plan 3,905 ( 15,268 ) ( 15,268 )

Balance at December 31, 2021 — $ — 73,584 $ 738 $ 241,854 24,828 $ ( 150,398 ) $ 24,229 $ ( 61 ) $ 116,362

See accompanying notes to the consolidated financial statements .

See accompanying notes to consolidated financial statements .

DHI GROUP, INC.

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Depreciation 17,118 12,019 9,743

Amortization of intangible assets — — 482

Deferred income taxes ( 569 ) ( 2,918 ) 2,493

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Impairment of goodwill — 23,626 —

Impairment of equity investment 2,002 — —

Impairment of right-of-use asset 1,919 — —

Impairment of investment — 2,002 —

Change in accrual for unrecognized tax benefits ( 156 ) ( 446 ) 107

Gain on sale of equity investment ( 200 ) — —

(Gain) loss on sale of businesses — 537 ( 3,369 )

Income from equity method investment ( 190 ) — —

Gain on sale of investment ( 1,198 ) ( 200 ) —

Loss on sale of businesses — — 537

Loss on disposition of discontinued operations 30,203 — —

Changes in operating assets and liabilities:

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Cash flows from (used in) investing activities:

Cash received from sale of businesses, net — 2,683 17,542

Cash transferred with discontinued operations ( 3,195 ) — —

Cash received from sale of business, net — — 2,683

Cash paid for investment ( 3,000 ) — —

Cash received from sale of investments 1,198 200 —

Purchases of fixed assets ( 14,307 ) ( 16,104 ) ( 14,188 )

Net cash received from sale of equity investment 200 — —

Net cash flows from (used in) investing activities ( 15,904 ) ( 11,505 ) 7,489

Net cash flows used in investing activities ( 19,304 ) ( 15,904 ) ( 11,505 )

Cash flows from (used in) financing activities:

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Purchase of treasury stock related to vested restricted and performance stock units ( 2,978 ) ( 2,248 ) ( 1,904 )

Financing costs paid — — ( 504 )

Net cash flows used in financing activities ( 15,387 ) ( 542 ) ( 12,423 )

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Cash and cash equivalents, end of period $ 1,540 $ 7,640 $ 5,381

See accompanying notes to the consolidated financial statements.

See accompanying notes to consolidated financial statements.

DHI GROUP, INC.

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Employers and recruiters use its websites and services to source, hire and connect with the most qualified and highly-skilled tech professionals, while professionals use its websites and services to find ideal employment opportunities, relevant job advice and tailored career-related data.

For 30 years, through its predecessor companies, the Company was built on providing employers and professionals with career connections, news, tools and information.

The Company serves multiple markets located throughout North America, Europe, the Middle East and the Asia Pacific region.

For over 30 years, through its predecessor companies, the Company was built on providing employers and professionals with career connections, news, tools and information.

On June 30, 2021, the Company transferred majority ownership and control of its eFinancialCareers ("eFC") business to eFC's management, while retaining a 40 % common share interest.

The eFC business was significant to the Company and the transfer was considered to be a strategic shift from the financial services industry and from the geographies eFC serves that had a major effect on the Company's operations.

As a result, the eFC business was deconsolidated from the Company's consolidated financial statements as of June 30, 2021 and is reflected as a discontinued operation in the Consolidated Balance Sheets and the Consolidated Statements of Operations for all periods presented.

The historical Consolidated Statements of Comprehensive Income (Loss), Stockholders’ Equity and Cash Flows have not been revised to reflect the effects of the transfer of control of eFC.

For further information on discontinued operations, see Note 4, “Discontinued Operations.” Unless noted otherwise, discussion in the notes to the consolidated financial statements pertain to continuing operations .

The Company allocates resources and assesses financial performance on a consolidated basis, as all services pertain to the Company's Tech-focused strategy.

As a result, t he Company has a single reportable segment, Tech-focused, which now includes only the Dice and ClearanceJobs brands, as well as corporate related costs.

All operations are in the United States and the Company no longer has revenues and long-lived assets, which includes fixed assets and lease right of use assets, outside of the United States.

SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation — The consolidated financial statements include the accounts of DHI and its wholly-owned subsidiaries and cost method investment.

Principles of Consolidation — The consolidated financial statements include the accounts of DHI and its wholly-owned subsidiaries.

All intercompany balances and transactions have been eliminated in consolidation.

Investments in companies that are not consolidated are included in the Company's consolidated financial statements as described in notes 4 and 8 to the consolidated financial statements.

Revenue Recognition — We recognize revenue when control of the promised goods or services is transferred to our customers at an amount that reflects the consideration to which we expect to receive in exchange for those goods or services.

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Recruitment packages.

Recruitment package revenues are derived from the sale to recruiters and employers of a combination of job postings and/or access to a searchable database of candidates on Dice, ClearanceJobs, eFinancialCareers and Rigzone (sold the RigLogix portion of the Rigzone business on February 20, 2018 and DHI transferred majority ownership of the remaining Rigzone business to Rigzone management on August 31, 2018).

Certain of the Company’s arrangements include multiple performance obligations, which primarily consists of the ability to post jobs and access to a searchable database of candidates.

Recruitment package revenues are derived from the sale to recruiters and employers of a combination of job postings and/or access to candidate profiles on Dice and ClearanceJobs.

Certain of the Company’s arrangements include multiple performance obligations, which primarily consists of the ability to post jobs and access to candidate profiles.

The Company determines the units of accounting for multiple performance obligations in accordance with Topic 606.

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The Company’s arrangements do not include a general right of return.

Services to customers buying a package of available job postings and access to the database are delivered over the same period and revenue is recognized ratably over the length of the underlying contract, typically from one to twelve months.

The separation of the package into two deliverables results in no change in revenue recognition since delivery of the two services occurs over the same time period.

Services to customers buying a package of available job postings and access to candidate profiles are delivered over the same period and revenue is recognized ratably over the length of the underlying contract, typically from one to twelve months.

The separation of the package into two deliverables results in no change in revenue recognition because delivery of the two services occurs over the same time period.

Advertising revenue.

Advertising revenue is recognized over the period in which the advertisements are displayed on the websites or at the time a promotional e-mail is sent out to the audience.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Classified revenue.

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Revenue from the sale of classified job postings is recognized ratably over the length of the contract or the period of actual usage.

Data services revenue.

Access to the Company’s database of energy industry data is provided to customers for a fee.

Data services revenue is recognized ratably over the length of the underlying contract, typically from one to twelve months.

The data services business, called RigLogix, was sold on February 20, 2018.

Career fair and recruitment event booth rentals.

Career fair and recruitment event revenues are derived from renting booth space to recruiters and employers.

Career fair and recruitment event revenues, both live and virtual, are derived from renting booth space to recruiters and employers.

Revenue from these sales are recognized when the career fair or recruitment event is held.

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The Company believes it is not exposed to any significant credit risk.

The Company performs ongoing credit evaluations of its customers’ financial condition and generally does not require collateral on accounts receivable.

The Company performs credit evaluations of its customers’ financial condition as needed and does not require collateral on accounts receivable.

No single customer represents 10% or more of revenues for the years ended December 31, 2021, 2020 and 2019.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Allowance for Doubtful Accounts— The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.

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Amortization of leasehold improvements is provided over the shorter of the term of the related lease or the estimated useful life of the improvement.

The cost of additions and betterments is capitalized, and repairs and maintenance costs are charged to operations in the periods incurred.

The cost of additions and improvements is capitalized, and repairs and maintenance costs are charged to operations in the periods incurred.

Capitalized Software Costs— Capitalized software costs consist of costs to purchase and develop software for internal use.

The Company capitalizes certain incurred software development costs in accordance with the Internal Use Software subtopic of the FASB ASC.

The Company capitalizes incurred software development costs in accordance with the Internal Use Software subtopic of the FASB ASC.

Costs incurred during the application-development stage for software bought and further customized by outside vendors for the Company’s use and software developed by a vendor for the Company’s proprietary use have been capitalized.

These costs are amortized over the software’s estimated useful life, which generally approximates two years.

Website Development Costs— The Company capitalizes certain costs incurred in designing, developing, testing and implementing enhancements to its websites.

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Costs related to the planning and post implementation phases of website development efforts are expensed as incurred.

Capitalized Contract Costs— The Company capitalizes certain contract acquisition costs consisting primarily of commissions paid when contracts are signed.

For costs incurred to obtain new business sales contracts, the Company capitalizes and expenses these costs over an average customer life, which was approximately two years as of December 31, 2021.

For the remaining

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

sales contracts, the Company capitalizes and expenses these costs over a weighted average contract term, which was approximately one year as of December 31, 2021.

See note 5 for additional disclosures.

Leases— We determine if an arrangement is a lease at inception.

The Company primarily has operating leases for corporate office space and certain equipment.

Operating lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

Operating lease assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.

When readily available, the Company uses the implicit rate in determining the present value of the lease payments.

When leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on information available at the commencement of the lease, including the lease term.

Because the implicit rate in each lease is not available, the Company used its incremental borrowing rate to determine the present value of lease payments.

Leases with an initial term of 12 months or less are not recorded on the balance sheet.

Variable components of the lease payments, such as utilities and maintenance, are expensed as incurred and are not included in determining the present value.

Operating lease expense is recognized on a straight-

line basis over the lease term.

Equity Method Investment— The Company has a 40 % non-controlling common share interest in the eFC and Rigzone businesses as the Company does not have the ability to direct the activities of the businesses that most significantly impact their economic performance.

The 40 % common share interest is being accounted for under the equity method of accounting as the Company does have the ability to exercise significant influence over the businesses.

The recorded value is adjusted based on the Company's proportionate share of the businesses net income and is recorded three months in arrears.

See note 8 for additional disclosures.

Goodwill and Indefinite-Lived Acquired Intangible Assets— Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired.

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See Notes 10 and 11 for discussion of impairment charges.

Capitalized Contract Costs— The Company capitalizes certain contract acquisition costs consisting primarily of commissions paid when contracts are signed.

For costs incurred to obtain new business sales contracts, the Company capitalizes and expenses these costs over an average customer life, which was approximately two years as of December 31, 2020.

For the remaining sales contracts, the Company capitalizes and expenses these costs over a weighted average contract term, which was approximately one year as of December 31, 2020.

See Note 3 for additional contract acquisition cost disclosures.

Foreign Currency Translation— For the Company’s foreign operations whose functional currency is not the U.S.

Foreign Currency Translation— For the Company’s foreign operations, which entirely related to eFC prior to June 30, 2021, whose functional currency is not the U.S.

dollar, the assets and liabilities are translated into U.S.

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Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are charged to operations as incurred.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Translation adjustments subsequent to June 30, 2021 relate to the Company's equity method investment in eFC.

Advertising Costs— The Company expenses advertising costs as they are incurred.

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Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.

The primary sources of temporary differences are stock-based compensation, amortization and impairment of intangible assets, and depreciation of fixed assets.

The primary sources of temporary differences are stock-based compensation, amortization and impairment of intangible assets, depreciation of fixed assets, and capitalized contract costs.

Stock-Based Compensation— The Company has a plan to grant equity awards to certain employees and directors of the Company and its subsidiaries.

See Note 17 for additional disclosures.

Fair Value of Financial Instruments— The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, and accounts payable and accrued expenses approximate their fair values.

The Company’s long-term debt consists of borrowings under its credit facility.

See Note 5 for fair value disclosures.

The Company’s

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

long-term debt consists of borrowings under its credit facility.

Investments consist of promissory notes and common share ownership interests in businesses.

See Notes 3 and 12 for additional disclosures.

Risks and Uncertainties— The Company is subject to the risks, expenses and uncertainties frequently encountered by companies in the rapidly evolving markets for online products and services.

These risks include the failure to develop and extend the Company’s online service brands, the rejection of the Company’s services by consumers, vendors and/or advertisers, the inability of the Company to maintain and increase the levels of traffic on its online services, as well as other risks and uncertainties.

These risks include the failure to develop and extend the Company’s web sites and brands, the rejection of the Company’s services by consumers, vendors and/or advertisers, the inability of the Company to maintain and increase the levels of traffic on its web sites, as well as other risks and uncertainties.

In the event that the Company does not successfully execute its business plan, certain assets may not be recoverable.

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Actual results could differ from these estimates.

DHI’s significant estimates include the useful lives and valuation of fixed assets and intangible assets, goodwill, the income tax valuation allowance, and the assumptions used to value the Performance-Based Restricted Stock Units (“PSUs”) of the Company.

DHI’s significant estimates include the useful lives and valuation of fixed assets and intangible assets, goodwill, lease right-of-use assets, income taxes, and

the assumptions used to value the Performance-Based Restricted Stock Units (“PSUs”) of the Company.

Earnings per Share— The Company follows the Earnings Per Share topic of the FASB ASC in computing earnings per share (“EPS”).

Basic EPS is calculated by dividing net income by the weighted average number of shares outstanding.

Basic EPS is calculated by dividing income from continuing operations, income from discontinued operations, and net income by the weighted average number of shares outstanding.

When the effects are dilutive, diluted earnings per share is calculated using the weighted average number of shares outstanding, and the dilutive effect of stock-based compensation awards as determined under the treasury stock method.

Certain stock awards were excluded from the computation of diluted (loss) earnings per share due to their anti-dilutive effect.

New Accounting Pronouncements— In May 2014, FASB issued ASU No.

2014-09 ("Topic 606"), Revenue from Contracts with Customers.

Topic 606 supersedes the revenue recognition requirements in Accounting Standards Codification Topic 605, Revenue Recognition, and requires entities to measure and recognize revenue and the related cash flows it expects to be entitled for the transfer of promised goods or services to customers and requires an entity to recognize the incremental costs of obtaining a contract with a customer as an asset if the entity expects to recover those costs over time.

Topic 606 became effective for reporting periods beginning after December 15, 2017.

Topic 606 provides companies with two implementation methods.

Companies can choose to apply the standard retrospectively to each prior reporting period presented (full retrospective application) or retrospectively with the cumulative effect of initially applying the standard as an adjustment to the opening balance of retained earnings of the annual reporting period that includes the date of initial application (modified retrospective application).

The Company has chosen the modified retrospective application method and implemented Topic 606 effective January 1, 2018.

The Company has determined that the January 1, 2018 cumulative effect to its revenue streams was an increase of approximately $ 0.2 million to deferred revenues, and the cumulative effect to its contract acquisition costs was an increase to contract acquisition cost assets of approximately $ 6.1 million, with a net after tax increase to retained earnings of approximately $ 4.5 million.

The cumulative impact on contract acquisition costs was computed based on contracts in force as of December 31, 2017 using average commission rates on both new business sales to be amortized over approximately two years and the remaining sales contracts to be amortized over approximately one year.

See Note 3 to the Notes to the Consolidated Financial Statements.

In January 2016, the FASB issued ASU No.

2016-01, Financial Instruments - Overall (Subtopic 825-10):

Recognition and Measurement of Financial Assets and Financial Liabilities.

The new standard aims to improve existing U.S.

GAAP and will change certain aspects of accounting for equity investments, financial instruments, financial liabilities, and presentation and

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

related disclosures.

The updated standard became effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.

The Company adopted the new standard in the first quarter of 2018, and has determined the adoption did not have a material impact on its consolidated financial statements.

In February 2016, the FASB issued ASU No.

2016-02, Leases .

The new standard has requirements on how to account for leases by both the lessee and the lessor and adds clarification for what constitutes a lease, among other items.

The updated standard becomes effective for fiscal years beginning after December 15, 2018 and interim periods the following year, with early adoption permitted.

The new standard must be applied using a modified retrospective transition.

In July 2018, the FASB issued updated guidance which allows an additional transition method to adopt the new standard at the adoption date, as compared to the beginning of the earliest period presented, and recognize a cumulative-effect adjustment to the beginning balance of retained earnings in the period of adoption.

DHI implemented the new standard effective January 1, 2019 and elected to recognize a cumulative effect adjustment to the beginning balance of retained earnings in the period of adoption.

Adoption of this standard resulted in a right-of-use asset of $ 17.2 million, net of accrued rent and lease exit costs, and related operating lease liability of $ 18.0 million being established on the Company's balance sheet on January 1, 2019, with no cumulative-effect adjustment to retained earnings.

Right-of-Use ("ROU") assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the obligation to make payments arising from the lease.

The Company has implemented processes and tools to assist in the ongoing lease data collection and analysis, and has updated accounting policies and internal controls as a result of adopting this standard.

In June 2016, the FASB issued ASU No.

Certain stock awards were excluded from the computation of diluted earnings per share due to their anti-dilutive effect.

See Note 20 for additional disclosures.

New Accounting Pronouncements— In June 2016, the FASB issued ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326):

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The Company is evaluating the expected impact of this standard on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurements (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement .

This standard removes, modifies, and adds certain disclosure requirements for fair value measurements.

This pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019.

The Company adopted the new standard on January 1, 2020.

The adoption of ASU 2018-13 did not have a material impact on its consolidated financial statements.

In August 2018, the FASB issued ASU No.

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The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted.

The Company is evaluating the expected impact of this standard on its consolidated financial statements.

The Company adopted this standard on January 1, 2021, and the adoption did not have a material effect on the Company's consolidated financial statements.

FAIR VALUE MEASUREMENTS

The FASB ASC topic on Fair Value Measurements and Disclosures defines fair value, establishes a framework for measuring fair value and requires certain disclosures for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis.

As a basis for considering assumptions, a three-tier fair value hierarchy is used, which prioritizes the inputs used in measuring fair value as follows:

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

• Level 1 – Quoted prices for identical instruments in active markets.

• Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets.

• Level 3 – Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, other assets, accounts payable and accrued expenses and long-term debt approximate their fair values.

Investments, current, are carried at fair value using values available on a public exchange based on a Level 1 input.

Investments, non-current that are carried at fair value use a discounted cash flow technique based on the probability of one or more possible outcomes, based on Level 3 inputs, which inputs and fair value did not change during the year ended December 31, 2021.

The fair value of long-term debt was estimated using present value techniques and market based interest rates and credit spreads.

The estimated fair value of long-term debt is based on Level 2 inputs.

Certain assets and liabilities are measured at fair value on a non-recurring basis.

These assets include equity investments, operating lease right-of-use assets, and goodwill and intangible assets which resulted from prior acquisitions.

Items valued using such internally generated valuation techniques are classified according to the lowest level input or value driver that is significant to the valuation.

Thus, an item may be classified in Level 3 even though there may be some significant inputs that are readily observable.

Such instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, for example, when there is evidence of impairment.

On June 30, 2021, the Company transferred majority ownership and control of its eFC business to eFC's management, while retaining a 40 % common share interest.

The Company valued its 40 % interest in eFC utilizing a combination of a discounted cash flow and a market approach.

The discounted cash flow included declining revenues for the years ending December 31, 2021 and 2022 as compared to the year ended December 31, 2020 and then increasing moderately.

The discounted cash flow also included operating margin declines for the year ending December 31, 2022 compared to the year ending December 31, 2021 and then increasing moderately.

The Company utilized a discount rate of 19.0 %.

The market approach included the analysis of data from transactions on guideline companies and applied multiples of those transactions to eFC's results

Impairment —The Company performs annual impairment tests for goodwill and the Dice trademarks and brand name as of October 1 of each year or more frequently if indicators of potential impairment exist.

See notes 10 and 11 for additional disclosures.

The Company evaluates the carrying value of equity investments at each reporting period as described in note 8.

DISCONTINUED OPERATIONS

As further described in Note 1, on June 30, 2021, the Company transferred majority ownership and control of its eFC business to eFC's management, while retaining a 40 % common share interest.

As a result, we have reflected eFC's financial results as discontinued operations in the consolidated balance sheets and the consolidated statements of operations for all periods presented.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The assets and liabilities classified as discontinued operations on the consolidated balance sheets were as follows (in thousands):

December 31, 2020

Cash and cash equivalents $ 3,098

Accounts receivable, net 4,164

Income taxes receivable 511

Prepaid and other current assets 402

Current assets of discontinued operations 8,175

Fixed assets, net 1,511

Capitalized contract costs 1,545

Goodwill 5,253

Deferred income taxes 19

Operating lease right-of-use assets 5,601

Other assets 269

Non-current assets of discontinued operations 14,198

Total assets of discontinued operations $ 22,373

Accounts payable and accrued expenses $ 4,118

Operating lease liabilities 1,335

Deferred revenue 6,879

Income taxes payable 123

Current liabilities of discontinued operations 12,455

Deferred income taxes 171

Deferred revenue 33

Accrual for unrecognized tax benefits 406

Operating lease liabilities 4,333

Other long-term liabilities 345

Non-current liabilities of discontinued operations 5,288

Total liabilities of discontinued operations $ 17,743

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The results of discontinued operations on the consolidated statements of operations were as follows (in thousands):

For the year ended December 31,

2021 2020 2019

Revenues $ 12,130 $ 25,711 $ 32,098

Operating expenses ( 10,821 ) ( 22,926 ) ( 25,201 )

Operating income 1,309 2,785 6,897

Loss on disposition of discontinued operations (1)

( 30,203 ) — —

Other income 1 4 2

Income (loss) before income taxes ( 28,893 ) 2,789 6,899

Income tax expense 447 407 979

Net income (loss) $ ( 29,340 ) $ 2,382 $ 5,920

(1) The loss was comprised of $ 28.1 million related to the reclassification of currency translation adjustments and $ 5.2 million from the removal of eFC's net assets.

The loss was partially offset by the recording of an equity investment of $ 3.6 million and eFC's earnings during the six month period ended June 30, 2021.

Depreciation, fixed asset purchases and other significant non-cash items related to discontinued operations were as follows (in thousands):

For the year ended December 31,

2021 2020 2019

Depreciation $ 774 $ 1,760 $ 1,315

Purchases of fixed assets $ 447 $ 225 $ 2,052

Cash paid for amounts included in measurement of lease liabilities:

Operating cash flows from operating leases $ 804 $ 1,520 $ 1,469

REVENUE RECOGNITION

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Customer billings delivered in advance of services being rendered are recorded as deferred revenue and recognized over the service period.

The Company generates revenue from recruitment packages, advertising, classifieds, data services, and career fair and recruitment event booth rentals.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company generates revenue from recruitment packages, advertising, classifieds, and virtual and live career fair and recruitment event booth rentals.

Disaggregation of revenue

Our brands serve various economic professions, such as technology, financial, hospitality (the Hcareers business was sold on May 22, 2018), and energy (sold the RigLogix portion of the Rigzone business on February 20, 2018 and transferred majority ownership of the remaining Rigzone business to Rigzone management on August 31, 2018).

The following table provides information about disaggregated revenue by brand and includes a reconciliation of the disaggregated revenue with reportable segments (in thousands):

Our brands primarily serve the technology and security cleared professions.

The following table provides information about disaggregated revenue by brand (in thousands):

For the Year Ended December 31,

2021 2020 2019

Tech-focused Other Total Tech-focused Other Total Tech-Focused Other Total

$ 86,257 $ 82,190 $ 92,527

ClearanceJobs 33,646 28,977 24,745

eFinancial Careers 25,711 — 25,711 32,098 — 32,098 33,758 — 33,758

Dice Europe (2)

— — — — — — 2,976 — 2,976

— — — — — — — 3,771 3,771

— — — — — — — 5,329 5,329

— — — — — — 212 212

Total $ 119,903 $ 111,167 $ 117,272

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and Career Events.

(2) The Company ceased Dice Europe operations on August 31, 2018.

(3) The Company sold the RigLogix portion of the Rigzone business on February 20, 2018 and transferred majority ownership of the remaining Rigzone business to Rigzone management on August 31, 2018.

Hcareers was sold on May 22, 2018 and the Company transferred majority ownership of BioSpace to BioSpace management on January 31, 2018.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Contract Balances

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The Company recognized the following revenues as a result of changes in the contract liability balances in the respective periods (in thousands):

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Year Ended December 31, 2021 Year Ended December 31, 2020 Year Ended December 31, 2019

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Tech-focused $ 45,217 $ 830 $ 99 $ 46,146

Contract acquisition costs

We are required to capitalize certain contract acquisition costs consisting primarily of commissions paid when contracts are signed.

As allowed for by the practical expedient, the Company is using a portfolio approach for contract acquisition costs, which allows the new revenue guidance to be applied to a portfolio of contracts with similar characteristics.

As a result, the Company has applied the portfolio approach to new business contracts and recurring or remaining business contracts.

The Company reasonably expects that the effects of applying the portfolio approach would not differ materially from applying Topic 606 at the individual contract level.

As of January 1, 2018, the date we adopted Topic 606, we capitalized $ 6.1 million in contract acquisition costs related to contracts that were not completed.

The cumulative effect for contract acquisition costs was computed based on contracts in force as of December 31, 2017 using the average commission rates on both new business sales contracts, to be amortized over approximately two years, and the remaining sales contracts to be amortized over approximately one year.

For costs incurred to obtain new business sales contracts, we will record these costs over an average customer life, which was determined using customer renewal rates;

for the remaining sales contracts, we will record these costs over the weighted average contract term.

The Company recorded $ 11.5 million, $ 11.8 million and $ 10.1 million of expense related to the amortization of contract acquisition costs during the years ended December 31, 2020, 2019 and 2018, respectively, and there was no impairment loss incurred.

SALE OF BUSINESSES

The Company transferred a majority ownership of the Rigzone business to Rigzone management on August 31, 2018.

The Company retained a 40 % common share interest in Rigzone.

The Company incurred approximately $ 0.4 million in selling costs and recognized a $ 0.4 million loss on sale in the third quarter of 2018.

The Company sold the Hcareers business on May 22, 2018 for $ 16.5 million and incurred approximately $ 1.5 million in selling costs, with $ 1.7 million of the purchase price placed in escrow, to be released twelve months after the closing date, subject to the terms and conditions of the transaction agreement, including certain contingencies.

Net cash proceeds of $ 14.0 million were received on the date of sale of Hcareers.

As a result of the sale, a $ 0.8 million loss was recognized in the second quarter of 2018.

During the second quarter of 2019, the escrow of $ 1.7 million and working capital terms and related contingencies were finalized resulting in the Company recording an additional loss on sale of $ 0.5 million and receiving cash of $ 0.7 million from the escrow and $ 0.2 million from working capital.

The Company sold the RigLogix portion of the Rigzone business on February 20, 2018 for $ 4.2 million and incurred approximately $ 0.6 million in selling costs.

$ 0.4 million of the purchase price was placed in escrow, which was released to the Company in the first quarter of 2019.

As a result of the sale, a $ 4.6 million gain was recognized in the first quarter of 2018.

The gain on sale exceeded net proceeds as liabilities transferred in the transaction exceeded assets, primarily due to deferred revenues of $ 1.2 million.

The Company transferred a majority ownership of the BioSpace business to BioSpace management on January 31, 2018.

The Company retained a preferred share interest in BioSpace, Inc., representing a 20 % diluted interest.

The Company incurred approximately $ 0.3 million in selling costs and recognized a $ 0.5 million loss on sale during the year ended December 31, 2018.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company sold the Health eCareers business on December 4, 2017 for $ 15.0 million.

$ 1.5 million of the purchase price was placed in escrow, which was released to the Company in the second quarter of 2019.

FAIR VALUE MEASUREMENTS

As a basis for considering assumptions, a three-tier fair value hierarchy is used, which prioritizes the inputs used in measuring fair value as follows:

• Level 1 – Quoted prices for identical instruments in active markets.

• Level 3 – Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The carrying amounts reported in the Consolidated Balance Sheets for cash and cash equivalents, accounts receivable, other assets, accounts payable and accrued expenses and long-term debt approximate their fair values.

The fair value of the long-term debt was estimated using present value techniques and market based interest rates and credit spreads.

The estimated fair value of long-term debt is based on Level 2 inputs.

Certain assets and liabilities are measured at fair value on a non-recurring basis.

These assets include investments (included in other assets), goodwill and intangible assets which resulted from prior acquisitions.

Items valued using such internally generated valuation techniques are classified according to the lowest level input or value driver that is significant to the valuation.

Thus, an item may be classified in Level 3 even though there may be some significant inputs that are readily observable.

Such instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, for example, when there is evidence of impairment.

See Notes 9 and 10 of the Notes to Consolidated Financial Statements.

The Company evaluates the carrying value of equity investments at each reporting period as described in Note 6 of the Notes to the Consolidated Financial Statements.

At January 1, 2018, the Company held preferred stock representing a 10.0 % interest in the fully diluted shares of a leading tech skills assessment company.

During 2018, the skills assessment company completed an additional equity offering, lowering DHI's total interest to 7.6 %.

The Company did not adjust the recorded value of the investment because the shares issued under the new share offering were not similar to the Company's share rights.

The Company has elected the measurement alternative in accordance with FASB ASC 321, Investments - Equity Securities.

As of December 31, 2019, it was not practicable to estimate the fair value of the preferred stock as the shares are not traded.

Accordingly, the investment was carried at its original cost of $ 2.0 million and was included in the other assets section of the Condensed Consolidated Balance Sheets.

During the year ended December 31, 2020, based on the investment's historical cash burn rate, uncertainty of its ability to meet revenue and cash flow projections, current liquidity position, lack of access to additional capital, and impacts from the COVID-19 pandemic, the Company determined the value to be zero.

Accordingly, the Company recorded an impairment charge of $ 2.0 million during the first quarter of 2020.

On January 31, 2018, the Company transferred a majority ownership of the BioSpace business to BioSpace management with zero proceeds received from the transfer, while retaining a 20 % preferred share interest in the BioSpace business.

At the time of sale, the fair value of the investment was estimated to be zero.

During the second quarter of 2020, the Company sold its 20 % interest in BioSpace to BioSpace management for $ 0.2 million.

Accordingly, the Company recognized a $ 0.2 million gain on sale, which was included in interest expense and other on the Consolidated Statements of Operations.

Rigzone is a website dedicated to delivering online content, data , and career services in the oil and gas industry in North America, Europe, the Middle East, and Asia Pacific.

Oil and gas companies, as well as companies that serve the energy industry, use Rigzone to find talent for roles such as petroleum engineers, sales, professionals with energy industry expertise

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

and skilled tradesmen.

On August 31, 2018, the Company transferred a majority ownership of the Rigzone business to Rigzone management, while retaining a 40 % common share interest, with zero proceeds received from the transfer.

The Company agreed to provide $ 0.4 million of funding to the Rigzone business, which was recorded in accounts payable and accrued expenses on the consolidated balance sheets as of December 31, 2018.

The Company has no further funding requirements to the Rigzone business.

The Company has evaluated the 40 % common share investment in the Rigzone business and has determined the investment meets the definition and criteria of a variable interest entity ("VIE").

The Company evaluated the VIE and determined that the Company does not have a controlling financial interest in the VIE, as the Company does not have the power to direct the activities of the VIE that most significantly impact the VIE's economic performance.

The common share interest is being accounted for under the equity method of accounting as the Company has the ability to exercise significant influence over Rigzone.

As accumulated earnings of the VIE have been approximately zero since the date of transfer, the investment continues to be recorded at cost, which was zero at December 31, 2020.

On January 1, 2019, the Company adopted ASU No.

2016-02, Leases (Topic 842), applying the modified retrospective transition.

Periods beginning after January 1, 2019 will be presented under Topic 842, while prior period amounts will not be adjusted and continue to be reported under the accounting standards in effect prior to January 1, 2019.

The Company sold the Hcareers business on May 22, 2018.

During the second quarter of 2019, the related escrow of $ 1.7 million and working capital terms and contingencies were finalized.

This resulted in the Company recording an additional loss on sale of $ 0.5 million and receiving cash of $ 0.7 million from the escrow and $ 0.2 million from working capital.

The Company sold the RigLogix portion of the Rigzone business on February 20, 2018.

In the first quarter of 2019, the related escrow of $ 0.4 million was released to the Company.

The Company sold the Health eCareers business on December 4, 2017.

In the second quarter of 2019, the related escrow of $ 1.5 million was released to the Company.

The Company has operating leases for corporate office space and certain equipment.

The leases have terms from one year to eight years , some of which include options to renew the lease, and are included in the lease term when it is reasonably certain that the Company will exercise the option.

No leases include options to purchase the leased property.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

We do not have any lease agreements with related parties.

Operating lease ROU assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.

Based on the present value of the lease payments for the remaining lease term of the Company's existing leases, the Company recorded operating ROU assets of $ 17.2 million and operating lease liabilities of $ 18.0 million as of January 1, 2019.

Operating lease ROU assets and liabilities commencing after January 1, 2019 are recognized at commencement date based on the present value of lease payments over the lease term.

When readily available, the Company uses the implicit rate in determining the present value of the lease payments.

When leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on information available at the commencement of the lease, including the lease term.

Because the implicit rate in each lease is not available, the Company used its incremental borrowing rate to determine the present value of lease payments.

Leases with an initial term of 12 months or less are not recorded on the balance sheet.

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

The component of lease cost were as follows (in thousands):

Year Ended December 31, 2020 Year Ended December 31, 2019

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The components of lease cost were as follows (in thousands):

Year Ended December 31, 2021 Year Ended December 31, 2020 Year Ended December 31, 2019

Operating lease cost* $ 2,277 $ 2,551 $ 2,785

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Supplemental cash flow information related to leases was as follows (in thousands):

Year Ended December 31, 2020 Year Ended December 31, 2019

Year Ended December 31, 2021 Year Ended December 31, 2020 Year Ended December 31, 2019

Cash paid for amounts included in measurement of lease liabilities:

4 unchanged sentences

$ — $ 292 $ 7,434

Supplemental balance sheet information related to lease was as follows (in thousands, except lease term and discount):

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Supplemental balance sheet information related to leases was as follows (in thousands, except lease term and discount):

Year Ended December 31, 2021 Year Ended December 31, 2020

9 unchanged sentences

Operating leases

The Company reviews its ROU assets for impairment if indicators of impairment exist.

The impairment review process compares the fair value of the ROU asset to its carrying value.

If the carrying value exceeds the fair value, an impairment loss is recorded.

During the year ended December 31, 2021, due to the continuing impacts of COVID-19 on the real estate markets and its impact on the future cash flows attributable to its ROU assets, the Company recorded an impairment charge of $ 1.9 million.

No impairment was recorded during the years ended December 31, 2020 and 2019.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2021, future operating lease payments were as follows:

1 unchanged sentence

Operating Leases

2025 and Thereafter 1,521

Thereafter 82

Total lease payments

1 unchanged sentence

As of December 31, 2021, the Company has no additional operating or finance leases that have not yet commenced.

No leases include options to purchase the leased property.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

We do not have any lease agreements with related parties.

Investments, Current, at Fair Value

Through its predecessor companies, the Company owned a minority interest representing less than 1% of the common stock of a technology company that completed an initial public offering ("IPO") and became publicly traded during the first quarter of 2021.

Prior to the IPO, the Company had elected the measurement alternative in accordance with FASB ASC 321, Investments – Equity Securities.

As of December 31, 2020, it was not practicable to estimate the fair value of its interest because there were no observable transactions for the investment.

Accordingly, the investment was carried at its original cost, less impairments, which resulted in a carrying value of zero as of December 31, 2020.

The investment was accounted for as an equity security, with realized and unrealized gains and losses included in earnings.

During the third quarter of 2021, the investment was sold for $ 1.2 million.

Accordingly, the recorded value as of December 31, 2021 was zero.

A realized gain of $ 1.2 million has been recorded for the year ended December 31, 2021.

Investments, Non-current, at Fair Value

During the third quarter of 2021, the Company invested $ 3.0 million through a subordinated convertible promissory note (the "Note") of $ 3.0 million with a values-based career destination company that allows the next generation workforce to search for jobs at companies whose people, perks and values align with their unique professional needs.

The Note earns interest at 6.00 % and matures at the earlier of a Qualified Financing, as described in the Note, or settled in cash on or after August 20, 2022, at the option of the Company.

Upon a Qualified Financing, the Company will convert its investment into shares of preferred stock at 80 % of the per share value in the Qualified Financing.

The investment is recorded as a trading security at fair value with realized and unrealized gains and losses included in earnings.

The Note is recorded at $ 3.0 million as of December 31, 2021 and there was no gain or loss included in earnings during the year ended December 31, 2021.

Investments, Non-current

Rigzone is a website dedicated to delivering online content, data, and career services in the oil and gas industry in North America, Europe, the Middle East, and Asia Pacific.

Oil and gas companies, as well as companies that serve the energy industry, use Rigzone to find talent for roles such as petroleum engineers, sales professionals with energy industry expertise and skilled tradesmen.

On August 31, 2018, the Company transferred a majority ownership and control of the Rigzone business to Rigzone management, while retaining a 40 % common share interest.

The Company has evaluated the 40 % common share interest in the Rigzone business and has determined the investment meets the definition and criteria of a variable interest entity ("VIE").

The common share interest is being accounted for under the equity method of accounting as the

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Company has the ability to exercise significant influence over Rigzone.

As accumulated earnings of the VIE have been approximately zero since the date of transfer, the investment is recorded at zero at December 31, 2021.

As further described in Notes 1 and 4, on June 30, 2021, the Company transferred majority ownership and control of its eFC business to eFC's management, while retaining a 40 % common share interest with zero proceeds received from the transfer.

The Company incurred approximately $ 0.1 million in selling costs and recognized a $ 30.2 million loss on the transfer in the second quarter of 2021, which included a $ 28.1 million charge related to accumulated foreign currency loss that was previously a reduction to equity.

eFC is a financial services careers website, operating websites in multiple markets in four languages mainly across the United Kingdom, Continental Europe, Asia, the Middle East and North America.

Professionals from across many sectors of the financial services industry, including asset management, risk management, investment banking, and information technology, use eFC to advance their careers.

The Company has evaluated the 40 % common share interest in the eFC business and has determined the investment meets the definition and criteria of a variable interest entity ("VIE").

The common share interest is being accounted for under the equity method of accounting as the Company has the ability to exercise significant influence over eFC.

The investment was recorded at its fair value on June 30, 2021, the date of transfer, which was $ 3.6 million.

The Company's equity in net assets of eFC as of June 30, 2021 was $2.2 million.

The difference between the Company's recorded value and its equity in net assets of eFC is amortized against the recorded value of the investment in accordance with ASC 323 Investments - Equity Method and Joint Ventures .

The amortization was not material for the year ended December 31, 2021.

The recorded value is further adjusted based on the Company's proportionate share of eFC's net income and is recorded three months in arrears.

During the fourth quarter of 2021, the Company recorded $ 0.2 million of income related to its proportionate share of eFC's net income, net of currency translation adjustments and amortization of the basis difference.

At January 1, 2018, the Company held preferred stock representing a 10.0 % interest in the fully diluted shares of a tech skills assessment company.

During 2018, the skills assessment company completed an additional equity offering, lowering DHI's total interest to 7.6 %.

The Company did not adjust the recorded value of the investment because the shares issued under the new share offering were not similar to the Company's share rights.

As of December 31, 2019 it was not practicable to estimate the fair value of the preferred stock as the shares are not traded.

The investment was carried at its original cost of $ 2.0 million and was included in the other assets section of the consolidated balance sheets.

During the three months ended March 31, 2020, based on the investment's historical cash burn rate, uncertainty of its ability to meet revenue and cash flow projections, current liquidity position, lack of access to additional capital, and impacts from the COVID-19 pandemic, the Company determined the value to be zero.

Accordingly, the Company recorded an impairment charge of $ 2.0 million during the first quarter of 2020.

As of December 31, 2021, there have been no additional shares issued that were similar to the Company's share rights and the investment is recorded at zero as of December 31, 2021.

On January 31, 2018, the Company transferred a majority ownership of the BioSpace business to BioSpace management, while retaining a 20 % preferred share interest in the BioSpace business.

During the second quarter of 2020, the Company sold its 20 % interest in BioSpace to BioSpace management for $ 0.2 million.

At the time of sale, the recorded value of the investment was zero.

Accordingly, the Company recognized a $ 0.2 million gain on sale, which was included in interest expense and other on the consolidated statements of operations.

FIXED ASSETS, NET

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Fixed assets, net $ 20,581 $ 23,033

ACQUIRED INTANGIBLE ASSETS, NET

As a result of the sale of Hcareers (sold May 22, 2018), the Company disposed of all its remaining unamortized acquired intangible assets.

Acquired intangible assets disposed of in conjunction with the sale had costs of $ 12.9 million and accumulated amortization of $ 6.7 million.

Therefore, as of December 31, 2020 and 2019, the net value of all finite-lived acquired intangible assets was zero.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ACQUIRED INTANGIBLE ASSETS, NET

Considering the recognition of the Dice brand, its long history, awareness in the talent acquisition and staffing services market, and the intended use, the remaining useful life of the Dice.com trademarks and brand name was determined to be indefinite.

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If the carrying value exceeds the fair value, an impairment loss is recorded.

As of December 31, 2020 and 2019, the Company had an indefinite-lived acquired intangible asset of $ 23.8 million and $ 39.0 million, respectively, related to the Dice trademarks and brand name.

As of December 31, 2021 and 2020, the Company had an indefinite-lived acquired intangible asset of $ 23.8 million related to the Dice trademarks and brand name.

The annual impairment test for the Dice trademarks and brand name is performed on October 1 of each year.

During the first quarter of 2020, because of the initial impacts of the COVID-19 pandemic and its potential impact on future earnings and cash flows that are attributable to the Dice trademarks and brand name, the Company performed an interim impairment analysis.

As a result of the analysis, the Company recorded an impairment charge of $ 7.2 million during the first quarter of 2020.

During the third quarter of 2020, the impacts of the COVID-19 pandemic continued and the Company's projected earnings and cash flows that are attributable to the Dice trademarks and brand name declined as compared to the projections used in the March 31, 2020 analysis.

As a result, the Company performed an interim impairment analysis as of September 30, 2020, which resulted in the Company recording an additional impairment charge of $ 8.0 million during the three month period ended September 30, 2020.

Revenues attributable to the Dice trademarks and brand name for the fourth quarter of 2020 and estimated future results as of December 31, 2020 have exceeded the projections used in the September 30, 2020 analysis.

As a result, the Company believes it is not more likely than not that the fair value of the Dice trademarks and brand name is less than the carrying value as of December 31, 2020.

Therefore, no quantitative impairment test was performed as of December 31, 2020.

During the first and third quarters of 2020, because of the initial impacts of the COVID-19 pandemic and its potential impact on future earnings and cash flows that are attributable to the Dice trademarks and brand name, the Company recorded an impairment charge of $ 7.2 million and $ 8.0 million, respectively.

No impairment was recorded during the years ended December 31, 2021 and 2019.

The projections utilized in the March 31 and September 30, 2020 analyses included a decline in revenues caused by the COVID-19 pandemic that are attributable to the Dice trademarks and brand name for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The September 30, 2020 analysis included a further decline in revenues caused by the COVID-19 pandemic that are attributable to the Dice trademarks and brand name for the year ending December 31, 2021 compared to the year ended December 31, 2020 and then increasing to rates approximating industry growth projections, although peaking at rates slightly lower than in the March 31, 2020 analysis.

The projections utilized in the October 1, 2021 analysis included increasing revenues at rates approximating industry growth projections.

The Company’s ability to achieve these revenue projections may be impacted by, among other things, uncertainty related to COVID-19, competition in the technology recruiting market, challenges in developing and introducing new products and product enhancements to the market and the Company’s ability to attribute value delivered to customers.

Cash flows that are attributable to the Dice trademarks and brand name were projected to decline for the year ended December 31, 2020 compared to the year ended December 31, 2019 as a result of the lower revenue, but partially offset by reductions to operating expenses.

Operating expenses, excluding impairments, utilized in the March 31 and September 30, 2020 analyses were projected to decline for the year ended December 31, 2020 as compared to the year ended December 31, 2019, including a reduction in operating margin.

The March 31, 2020 analysis included modest operating margin improvements during the year ending December 31, 2021 and beyond while the September 30, 2020 analysis included a small reduction in operating margin during the year ending December 31, 2021 and then increasing modestly.

The October 1, 2021 analysis included operating margins during the year ending December 31, 2021 that approximate operating margins for the year ended December 31, 2020 and then increasing modestly.

If future cash flows that are attributable to the Dice trademarks and brand name are not achieved, the Company could realize an impairment in a future period.

In the March 31, 2020 and September 30, 2020 analyses, the Company utilized a relief from royalty rate method to value the Dice trademarks and brand name using a royalty rate of 5.0 % and 4.0 %, respectively, based on comparable industry studies and a discount rate of 17.5 % and 15.5 %, respectively.

The decline in the royalty rate is due to revenue declines and impacts of the COVID-19 pandemic and the decline in the discount rate is primarily due to the lower projections, as compared to the March 31, 2020 analysis.

The Company's operating results attributable to the Dice trademarks and brand name through December 31, 2021 and projections of future results have met or exceeded those included in the projections utilized in the October 1, 2021 analysis.

In the October 1, 2021 analysis, the Company utilized a relief from royalty rate method to value the Dice trademarks and brand name using a royalty rate of 4.0 % based on comparable industry studies and a discount rate of 12.5 %.

The determination of whether or not indefinite-lived acquired intangible assets have become impaired involves a significant level of judgment in the assumptions underlying the approach used to determine the value of the indefinite-lived acquired intangible assets.

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If projections are not achieved, the Company could realize an impairment in the foreseeable future.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table shows the carrying amount of goodwill by segment as of December 31, 2020 and 2019 and the changes in goodwill for the years then ended (in thousands):

The following table shows the carrying amount of goodwill as of December 31, 2021 and 2020, and the changes in goodwill for the years then ended (in thousands):

Goodwill at January 1, 2020 $ 150,707

Foreign currency translation adjustment 2,085

Goodwill at December 31, 2019 $ 156,059

Foreign currency translation adjustment 920

Impairment ( 22,607 )

Goodwill at December 31, 2020 $ 128,100

The amount of goodwill as of December 31, 2020 allocated to the Tech-focused reporting unit was $ 133.4 million.

Activity during 2021 —

Goodwill at December 31, 2021 $ 128,100

Accumulated impairment losses at December 31, 2021 and 2020 was $ 22.6 million.

Goodwill as of December 31, 2021 and 2020, which was allocated to the Tech-focused reporting unit, was $ 128.1 million.

There were no changes to goodwill during the year ended December 31, 2021.

During the third quarter 2020, because of the impacts of the COVID-19 pandemic and its potential impact on future earnings and cash flows for the reporting unit, the Company recorded an impairment charge of $ 22.6 million.

On June 30, 2021, the

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Company transferred a majority interest of its eFC business, which was part of the Tech-focused reporting unit, to management.

As a result, the Company performed an interim impairment analysis of goodwill.

The annual impairment test for the Tech-focused reporting unit is performed on October 1 of each year.

During the first quarter of 2020, because of the initial impacts of the COVID-19 pandemic and its potential impact on future earnings and cash flows for the reporting unit, the Company performed an interim impairment analysis of goodwill.

The results of the analysis indicated that the fair value of the Tech-focused reporting unit was not substantially in excess of the carrying value as of March 31, 2020.

The percentage by which the estimated fair value exceeded carrying value for the Tech-focused reporting unit at March 31, 2020 was less than 1%.

During the third quarter of 2020, the impacts of the COVID-19 pandemic continued and the Company's projected earnings and cash flows for the Tech-focused reporting unit declined as compared to the projections used in the March 31, 2020 analysis.

As a result, the Company performed an interim impairment analysis as of September 30, 2020, which resulted in the Company recording an impairment charge of $ 23.6 million during the three month period ended September 30, 2020.

Results for the Tech-focused reporting unit for the fourth quarter of 2020 and estimated future results as of December 31, 2020 have exceeded the projections used in the September 30, 2020 analysis.

The results of the impairment tests indicated that the fair value of the Tech-focused reporting unit was substantially in excess of the carrying value as of June 30, 2021 and October 1, 2021.

Results for the Tech-focused reporting unit for the fourth quarter of 2021 and estimated future results as of December 31, 2021 have exceeded the projections used in the October 1, 2021 analysis.

As a result, the Company believes it is not more likely than not that the fair value of the reporting unit is less than the carrying value as of December 31, 2021.

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No impairment was recorded during the years ended December 31, 2021 and 2019.

Revenue projections for the Tech-focused reporting unit declined compared to the projections used in the March 31, 2020 analysis due to the continued impacts of the COVID-19 pandemic.

The September 30, 2020 analysis included a further decline in revenues attributable to the Tech-focused reporting unit for the year ending December 31, 2021 compared to the year ended December 31, 2020 and then increasing to rates approximating industry growth projections, although peaking at rates slightly lower than in the March 31, 2020 analysis.

The Company’s ability to achieve these revenue projections may be impacted by, among other things, the length and impacts of the COVID-19 pandemic, competition in the technology recruiting market, challenges in developing and introducing new products and product enhancements to the market and the Company’s ability to attribute value delivered to customers.

Cash flows attributable to the Tech-focused reporting unit declined for the year ended December 31, 2020 compared to the year ended December 31, 2019 as a result of the lower revenue, but partially offset by reductions to operating expenses.

Operating expenses, excluding impairments, utilized in the March 31 and September 30, 2020 analyses have declined for the year ending December 31, 2020 as compared to the year ended December 31, 2019, including a reduction in operating margin.

The discount rate applied for the Tech-focused reporting unit in the September 30, 2020 analysis was 14.5 %, compared to 16.5 % at March 31, 2020.

The decline in the discount rate is primarily due to the lower projections, as compared to the March 31, 2020 analysis.

The projections utilized in the October 1, 2021 analysis included increasing revenues at rates approximating industry growth projections.

The October 1, 2021 analysis included operating margins during the year ending December 31, 2021 that approximate operating margins for the year ended December 31, 2020 and then increasing modestly.

If future cash flows that are attributable to the Tech-focused reporting unit are not achieved, the Company could realize an impairment in a future period.

The discount rate applied for the Tech-focused reporting unit in the October 1, 2021 analysis was 11.5 %.

An increase to the discount rate applied or reductions to future projected operating results could result in future impairment of the Tech-focused reporting unit’s goodwill.

It is reasonably possible that changes in judgments, assumptions and estimates the Company made in assessing the fair value of goodwill could cause the Company to consider some portion or all of the goodwill of the Tech-focused reporting unit to become impaired.

In addition, a future decline in the overall market conditions, uncertainty related to COVID-19, political instability, and/or changes in the Company’s market share could negatively impact the estimated future cash flows and discount rates used to determine the fair value of the reporting unit and could result in an impairment charge in the foreseeable future.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In addition, a future decline in the overall market conditions, uncertainty related to COVID-19, and/or changes in the Company’s market share could negatively impact the estimated future cash flows and discount rates used to determine the fair value of the reporting unit and could result in an impairment charge in the foreseeable future.

The determination of whether or not goodwill has become impaired is judgmental in nature and requires the use of estimates and key assumptions, particularly assumed discount rates and projections of future operating results, such as forecasted revenues and earnings before interest, taxes, depreciation and amortization margins and capital expenditure requirements.

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A market value of invested capital of the publicly traded companies is calculated and then applied to the entity’s operating results to arrive at an estimate of value.

Changes in our strategy and/or market conditions could significantly impact these judgments and require adjustments to recorded amounts of goodwill.

Credit Agreement —In November 2018, the Company, together with Dice Inc.

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The Company incurs a commitment fee ranging from 0.30 % to 0.45 % on any unused capacity under the revolving loan facility, determined by the Company's most recent consolidated leverage ratio.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The facility may be prepaid at any time without penalty.

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As of December 31, 2021, the Company was in compliance with all of the financial covenants under the Credit Agreement.

The obligations under the Credit Agreement are guaranteed by two of the Company’s wholly-owned subsidiaries, and secured by substantially all of the assets of the Borrowers and the guarantors and stock pledges from certain of the Company’s foreign subsidiaries.

The obligations under the Credit Agreement are guaranteed by two of the Company’s U.S.

based wholly-owned subsidiaries, and secured by substantially all of the assets of the Borrowers and the guarantors.

The amounts borrowed as of December 31, 2021 and 2020 are as follows (dollars in thousands):

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2021 December 31,

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Although the outcome of these legal matters cannot be determined, it is the opinion of management that the final resolution of these matters will not have a material adverse effect on the Company’s financial condition, operations or liquidity.

During the first quarter of 2018, the Company recorded a $ 1.0 million liability related to a class action lawsuit regarding the applicability of provisions of the Fair Credit Reporting Act (the "FCRA") to one of our products.

The lawsuit was brought by Ian Douglas, individually, as a representative of the class and on behalf of the general public, against DHI Group, Inc.

and Dice Inc.

asserting six claims under the FCRA that the Company’s Open Web profiles are “consumer reports” and Dice is a “consumer reporting agency” under the FCRA, including claims pursuant to the private right of action in 15 U.S.C.

Section 1681n for alleged willful violations of the FCRA.

The action was originally filed in a federal district court on July 26, 2017, but as a part of the settlement process, the action was re-filed in the Superior Court of Santa Clara County, California (Case No.

The recorded liability reflected a settlement, which was subject to a final judgment, and was paid in the third quarter of 2019.

The settlement resolved all remaining claims subject to the lawsuit, and final judgment approving the settlement was entered on July 24, 2020.

Tax Contingencies

The Company operates in a number of tax jurisdictions and is routinely subject to examinations by various tax authorities with respect to income taxes and indirect taxes.

The Company operates in a number of tax jurisdictions and is routinely subject to examinations by various tax authorities with respect to both income and indirect taxes.

The determination of the Company’s worldwide provision for taxes requires judgment and estimation.

The Company has reserved for potential examination adjustments to our provision for income taxes and accrual of indirect taxes in amounts which the Company believes are reasonable.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

EQUITY TRANSACTIONS

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May 2018 to May 2019 May 2019 to May 2020 May 2020 to May 2021 (1)

Approval Date May 2018 April 2019 May 2020

Authorized Repurchase Amount of Common Stock $ 7 million $ 7 million $ 5 million

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Feb 2021 to Jun 2022 (2)

Approval Date May 2018 April 2019 May 2020 February 2021

Authorized Repurchase Amount of Common Stock $ 7 million $ 7 million $ 5 million $ 20 million

(1) During the first quarter of 2021, the Company completed its purchases under the plan, which consisted of 2.2 million shares for $ 5.0 million, effectively ending the plan prior to its original expiration date.

(2) During the second quarter of 2021, the Company amended its $ 8.0 million stock repurchase program approved in February 2021 and allowed for the purchase of an additional $ 12.0 million of our common stock through June 2022, bringing total authorized purchases under the plan to $ 20.0 million.

As of December 31, 2021, the value of shares available to be purchased under the current plan was $ 5.8 million.

During the years ended December 31, 2020, 2019 and 2018, purchases of the Company’s common stock pursuant to Stock Repurchase Plans were as follows:

During January 2022, the Company repurchased approximately 742,000 shares for $ 4.3 million under the current plan.

Purchases of the Company's common stock pursuant to the Stock Repurchase Plans were as follows:

Year Ended December 31,

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Dollar value of shares repurchased (in thousands) $ 15,323 $ 8,436 $ 2,519

Unsettled shares repurchased [3]

63,451 4,310 26,337

(1) No shares of our common stock were purchased other than through a publicly announced plan or program.

(2) Average price paid per share includes costs associated with the repurchases.

[3] Included in the number of shares repurchased above

There were 48,260 , 63,451 and 4,310 unsettled shares as of December 31, 2021, 2020 and 2019, respectively.

The Company's Board approved the retirement of 20 million shares of treasury stock during the first quarter of 2019 and, as a result, the Company reduced additional paid in capital by $ 161.6 million and Common Stock by $ 0.2 million during the quarter.

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There are no redemption rights associated with the preferred stock.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Liquidation rights

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Our Credit Agreement limits our ability to declare and pay dividends.

Refer to Note 11 “Indebtedness.”

Unclaimed Shareholder Liability— Prior to the third quarter of 2018, other long-term liabilities included $ 1.0 million due to former shareholders of the Company under a Joint Plan of Reorganization that was agreed to by the Company and two of its creditors, and confirmed by the U.S.

Bankruptcy Court of the Southern District Court of New York on June 24, 2003.

During the third quarter of 2018, the Company concluded the unclaimed amounts were no longer due and payable and further, such

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

amounts represent additional equity of the Company.

Accordingly, the Company reclassified $ 1.0 million from other long-term liabilities to additional paid-in capital during the third quarter of 2018.

See note 12 for additional disclosures.

ACCUMULATED OTHER COMPREHENSIVE LOSS

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This statement requires that all items that are required to be recognized as components of comprehensive income be reported in a financial statement with the same prominence as other financial statements.

During the year ended December 31, 2021, the Company had $ 28.1 million of currency translation adjustments reclassified to the Statements of Operations related to the removal of eFC's net assets.

The Company had no amounts reclassified out of accumulated other comprehensive income for the years ended December 31, 2020, and 2019.

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Balance at beginning of year $ ( 28,519 ) $ ( 29,248 ) $ ( 31,236 )

Translation adjustments 729 1,988 ( 3,906 )

Foreign currency translation adjustment 395 729 1,988

Cumulative translation adjustments reclassified to the Statements of Operations 28,063 — —

Balance at end of year $ ( 61 ) $ ( 28,519 ) $ ( 29,248 )

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In May 2017, the Company announced plans to divest a number of its online professional communities to achieve greater focus and resource allocation toward its core tech-focused business.

The planned divestitures included:

BioSpace (transferred majority ownership to BioSpace management on January 31, 2018 and sold the remaining interest during the second quarter of 2020), Hcareers (sold May 22, 2018), and Rigzone (sold the RigLogix portion of the Rigzone business on February 22, 2018 and transferred majority ownership of the remaining Rigzone business to Rigzone management on August 31, 2018).

Additionally, the Company ceased the Dice Europe operations on August 31, 2018 and vacated certain offices during 2018.

The planned divestitures were completed in 2018 and included BioSpace, Hcareers, and Rigzone.

The Company also ceased the Dice Europe operations in 2018 and vacated certain offices.

In connection with the planned divestitures and reorganization to the tech-focused strategy, the Company incurred certain costs, including severance and retention, lease exit, business closure, professional fees related to activist shareholders, search, financial advisory, and legal services, and other costs to further these strategic objectives.

The activities associated with disposition related and other costs were substantially completed during the year ended December 31, 2019.

The following table displays a roll forward of the disposition related and other costs and related liability balances (in thousands):

Accrual at December 31, 2019 Expense Cash Payments Accrual at December 31, 2020

Severance and retention $ 145 $ — $ ( 145 ) $ —

Lease exit and related asset impairment costs 365 — ( 117 ) 248

Total disposition related and other costs $ 510 $ — $ ( 262 ) $ 248

Accrual at December 31, 2018 Expense Cash Payments Accrual at December 31, 2019

Severance and retention $ 1,089 $ 1,258 $ ( 2,202 ) $ 145

Professional fees and other costs 1,271 442 ( 1,713 ) —

Lease exit and related asset impairment costs 947 — ( 582 ) 365

Total disposition related and other costs $ 3,307 $ 1,700 $ ( 4,497 ) $ 510

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Accrual at December 31, 2017 Expense Cash Payments Non-cash Impairment Accrual at December 31, 2018

Severance and retention $ 1,237 $ 3,191 $ ( 3,339 ) $ — $ 1,089

Professional fees and other costs 825 2,914 ( 2,468 ) — 1,271

Lease exit and related asset impairment costs — 1,514 ( 399 ) ( 168 ) 947

Total disposition related and other costs $ 2,062 $ 7,619 $ ( 6,206 ) $ ( 168 ) $ 3,307

Disposition related and other costs were zero for the years ended December 31, 2021 and 2020 and were $ 1.4 million for the year ended December 31, 2019.

STOCK BASED COMPENSATION

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The Company records expense based upon the number of awards outstanding with no estimate for forfeitures.

Stock based compensation disclosures within this footnote include expense and shares related to the eFC business.

The Company recorded stock based compensation expense of $ 8.3 million, $ 6.3 million, and $ 5.7 million during the years ended December 31, 2021, 2020, and 2019, respectively.

At December 31, 2021, there was $ 9.8 million of unrecognized compensation expense related to unvested awards, which is expected to be recognized over a weighted-average period of approximately 1.3 years.

In connection with the employment agreement for the Company's new Chief Executive Officer, the Company granted, as Inducement Grants Under NYSE Rule 303A.08, 1,750,000 restricted stock units during the second quarter of 2018 and 750,000 performance based restricted stock units during the fourth quarter of 2018 to the Company's new Chief Executive Officer.

Restricted Stock— Restricted stock is granted to employees of the Company and its subsidiaries, and to non-employee members of the Company’s Board.

These shares are part of the compensation plan for services provided by the employees or Board members.

These shares are part of the compensation plan for services provided by the employees or Board

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The closing price of the Company’s stock on the date of grant is used to determine the fair value of the grants.

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These shares are granted under two compensation agreements that are for services provided by the employees.

The first agreement expired and was terminated during the first quarter of 2020.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The first agreement expired and was terminated during the first quarter of 2020 and there were no unvested shares as of March 31, 2020.

Under the second agreement, the fair value of the PSUs are measured at the grant date fair value of the award, which was determined based on an analysis of the probable performance outcomes.

The performance period is over one year and is based on the achievement of bookings targets during the years ended December 31, 2020 and 2019, as defined in the agreement.

The performance period is over one year and is based on the achievement of bookings targets during the year of grant, as defined in the agreement.

The earned shares will then vest over a three year period, one-third on each of the first, second, and third anniversaries of the grant date, or if later, the date the Compensation Committee certifies the performance results with respect to the performance period.

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Accordingly, the Company remeasured the awards.

As of December 31, 2020, there were 1,352,438 unvested shares related to the second agreement.

There were no cash flow impact resulting from the grants.

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Stock Options— The fair value of each option grant is estimated using the Black-Scholes option-pricing model using the weighted-average assumptions in the table below.

This valuation model requires the Company to make assumptions and judgments about the variables used in the calculation, including the fair value of the Company’s common stock, the expected life (the period of time that the options granted are expected to be outstanding), the volatility of the Company’s common stock, a risk-free interest rate and expected dividends.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

a risk-free interest rate and expected dividends.

The expected life of options granted is derived from historical exercise behavior.

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Exercisable at December 31 — $ — $ —

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Year Ended December 31, 2020

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Exercisable at December 31 190,000 $ 8.28 $ —

The weighted-average remaining contractual term of options exercisable at December 31, 2020 is 0.2 years.

T he following table summarizes information about options outstanding as of December 31, 2020:

Options Outstanding Options

Exercise Price Number

Outstanding Weighted-

$ 7.00 - $ 7.99 100,000 0.1 100,000

$ 8.00 - $ 8.99 10,000 0.8 10,000

110,000 110,000

DHI GROUP, INC.

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Deferred tax assets:

Net operating loss carryforward $ 389 $ —

Capital loss carryforward $ 4,971 $ 5,225

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Recognized in consolidated balance sheets:

Deferred tax asset 19 7

Deferred tax liability ( 9,315 ) ( 9,765 )

Net deferred tax liability $ ( 9,315 ) $ ( 9,765 )

The Company had deferred tax assets of $ 0.4 million at December 31, 2020 related to net operating loss carryforwards;

$ 5.2 million and $ 5.0 million, respectively, at December 31, 2020 and 2019 related to capital loss carryforwards;

and $ 0.3 million and $ 0.1 million, respectively, at December 31, 2020 and 2019 related to tax credit carryforwards.

The net operating loss carryforward period is indefinite.

The capital losses expire in 2023 through 2025.

The tax credits expire in 2029.

The Company had deferred tax assets of $ 5.0 million and $ 5.2 million, respectively, at December 31, 2021 and 2020 related to capital loss carryforwards and $ 0.3 million at December 31, 2021 and 2020 related to tax credit carryforwards.

The capital losses expire in 2023 through 2025, and the tax credits expire in 2025 through 2030.

The Company has recorded valuation allowances of $ 5.1 million and $ 5.3 million, respectively, at December 31, 2021 and 2020 in order to measure only the portion of the deferred tax assets which are more likely than not to be realized.

Income (loss) before income taxes are as follows (in thousands):

2020 2019 2018

United States $ ( 5,628 ) $ 10,882 $ 762

Foreign ( 26,806 ) 5,442 8,840

Income (loss) before income taxes $ ( 32,434 ) $ 16,324 $ 9,602

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Tax expense (benefit) for the years ended December 31, 2021, 2020 and 2019 is as follows (in thousands):

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State 154 ( 79 ) 71

Foreign 82 684 1,570

Current income tax expense 499 1,280 152

Current income tax expense (benefit) ( 178 ) ( 340 ) 596

Deferred income tax expense (benefit):

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State ( 37 ) ( 461 ) 541

Foreign ( 432 ) 294 785

Deferred income tax expense (benefit) ( 451 ) ( 2,486 ) 2,198

Income tax expense (benefit) $ ( 629 ) $ ( 2,826 ) $ 2,794

A reconciliation between the tax expense at the federal statutory rate and the reported income tax expense is summarized as follows:

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A reconciliation between tax expense at the federal statutory rate and the reported income tax expense is summarized as follows:

Year Ended December 31,

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Federal statutory rate $ ( 216 ) $ ( 7,397 ) $ 1,979

Gain (loss) on sale of businesses ( 42 ) 84 ( 6,111 )

Loss (gain) on sale of businesses or investments ( 251 ) ( 42 ) 84

Stock-based compensation ( 84 ) 432 281

Nondeductible impairment — 5,029 —

State taxes, net of federal effect ( 315 ) 467 ( 38 )

Difference between foreign and U.S.

rates 32 ( 192 ) ( 102 )

State tax expense (benefit), net of federal effect 110 ( 514 ) 405

Change in accrual for unrecognized tax benefits ( 155 ) ( 216 ) 209

tax on global intangible low-taxed income, net of credits — 84 229

Executive compensation 541 323 147

Currency translation gains (losses) ( 278 ) ( 67 ) 219

transition tax on foreign earnings — 140 368

Research and development tax credits ( 478 ) ( 530 ) ( 558 )

Change in valuation allowances ( 30 ) 12 5,117

Other ( 96 ) 89 247

1 unchanged sentence

Effective tax rate 61.0 % 8.0 % 29.6 %

H.R.1, commonly known as the Tax Cuts and Jobs Act (“TCJA”), was signed into law in December 2017.

In the year ended December 31, 2018, the Company completed its analysis of the impact of the TCJA on its liability for the one-time transition tax on the deemed repatriation of undistributed earnings from foreign subsidiaries.

The Company recognized an adjustment on the basis of revised foreign earnings computations and additional guidance issued by U.S.

federal and state tax authorities, resulting in tax expense of $ 0.4 million.

In the year ended December 31, 2019, the Company increased its transition tax liability to reflect further guidance issued by tax authorities, resulting in tax expense of $ 0.1 million.

An uncertain tax position represents the Company’s expected treatment of a tax position taken in a filed tax return, or planned to be taken in a tax return not yet filed, that has not been reflected in measuring income tax expense for financial reporting purposes.

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During the years ended December 31, 2021, 2020 and 2019, interest expense (income) and penalties recorded in the consolidated statements of operations were $( 27,000 ), $( 195,000 ), and $ 91,000 , respectively.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Following is a reconciliation of the amounts of unrecognized tax benefits, net of tax and excluding interest and penalties, for the years ended December 31, 2021, 2020 and 2019 (in thousands):

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Decreases in tax positions related to prior year ( 42 ) — —

Settlements with taxing authorities — — ( 838 )

Lapse of statute of limitations ( 251 ) ( 179 ) ( 76 )

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If the unrecognized tax benefits at December 31, 2021, 2020, and 2019 were recognized in full, tax benefits of $ 0.8 million, $ 0.9 million, and $ 1.2 million, respectively, would affect the effective tax rate.

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

The Company has filed income tax returns in the U.S.

and various foreign jurisdictions.

The foreign returns relate to the eFC business, of which the Company transferred a majority interest and control to eFC's management on June 30, 2021.

See Notes 1 and 4 for additional disclosures.

The Company is generally no longer subject to examinations by U.S.

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The Company contributed $ 1.7 million, $ 1.6 million, and $ 1.4 million for the years ended December 31, 2021, 2020 and 2019, respectively, to match employee contributions to the Savings Plan.

SEGMENT INFORMATION

Beginning in 2019, the Company has had a single reportable segment, Tech-focused, which includes the Dice, ClearanceJobs, and eFinancialCareers services, as well as corporate related costs.

The Company allocates resources and assesses financial performance on a consolidated basis, as all services pertain to the Company's Tech-focused strategy.

Prior to 2019, the Company had other services and activities that individually were not significant in relation to consolidated revenues, operating income or total assets.

These include Hcareers (sold May 22, 2018), Rigzone (sold the RigLogix portion of the Rigzone business on February 20, 2018 and transferred majority ownership of the remaining Rigzone business to Rigzone management on August 31, 2018) , and Biospace (majority ownership transferred to BioSpace management on January 31, 2018) services, which are recorded in the "Other" category.

The Company’s current foreign operations are comprised of the Dice Europe (ceased operations on August 31, 2018) operations and a portion of the eFinancialCareers and Rigzone services (sold the RigLogix portion of the Rigzone business on February 20, 2018 and transferred majority ownership of the remaining business to Rigzone management on August 31, 2018), which operate in Europe, the financial centers of the gulf region of the Middle East, and Asia Pacific.

The Company's foreign operations also included Hcareers (sold May 22, 2018), which operated in Canada.

Revenue and long-lived assets by geography, as presented in the tables below, are based on the location of each of the Company's subsidiaries.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table shows the segment information (in thousands and recast for the change in reportable segments):

2020 2019 2018

Tech-focused $ 136,878 $ 149,370 $ 152,258

Other — — 9,312

Total revenues $ 136,878 $ 149,370 $ 161,570

Depreciation:

Tech-focused $ 12,019 $ 9,743 $ 9,001

Other — — 279

Total depreciation $ 12,019 9,743 $ 9,280

Amortization:

Tech-focused $ — $ — $ —

Other — — 482

Total amortization $ — $ — $ 482

Operating income (loss):

Tech-focused $ ( 29,605 ) $ 17,025 $ 7,280

Other — — 4,412

Operating income ( 29,605 ) 17,025 11,692

Interest expense and other ( 827 ) ( 701 ) ( 2,054 )

Other expense ( 2,002 ) — ( 36 )

Income (loss) before income taxes $ ( 32,434 ) $ 16,324 $ 9,602

Capital expenditures:

Tech-focused $ 16,104 $ 14,188 $ 10,060

Other — — 221

Total capital expenditures $ 16,104 $ 14,188 $ 10,281

2020 2019 2018

By Geography:

United States $ 113,202 $ 119,882 $ 121,097

United Kingdom 12,767 17,343 22,356

EMEA, APAC and Canada (1) 10,909 12,145 18,117

Non-United States 23,676 29,488 40,473

Total revenues $ 136,878 $ 149,370 $ 161,570

(1) Europe (excluding United Kingdom), the Middle East and Africa (“EMEA”) and Asia-Pacific (“APAC”).

Revenues from Canada ceased May 22, 2018 upon the sale of the Company's Hcareers business.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, December 31, December 31, December 31,

2020 2019 2020 2019

Long-lived assets 2:

United States $ 33,838 $ 30,260

United Kingdom 6,277 8,307

EMEA and APAC (1)

Non-United States 7,111 9,804

Total long-lived assets $ 40,949 $ 40,064

(1) Europe (excluding United Kingdom), the Middle East and Africa (“EMEA”) and Asia-Pacific (“APAC”).

(2) Long-lived assets include fixed assets and lease right of use assets.

EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share (“EPS”) is computed based on the weighted-average number of shares of common stock outstanding.

Diluted EPS is computed based on the weighted-average number of shares of common stock outstanding plus common stock equivalents assuming exercise of stock options, where dilutive.

Basic earnings (loss) per share is computed based on the weighted-average number of shares of common stock outstanding.

Diluted earnings per share is computed based on the weighted-average number of shares of common stock outstanding plus common stock equivalents, where dilutive.

As shown in the table below, certain dilutive shares were excluded from the computation of shares contingently issuable upon exercise as we recognized a loss from continuing operations.

The following is a calculation of basic and diluted earnings per share and weighted-average shares outstanding (in thousands, except per share amounts):

2021 2020 2019

Income (loss) from continuing operations—basic and diluted $ ( 30,015 ) $ 12,551 $ 7,174

Income (loss) from continuing operations $ ( 402 ) $ ( 32,397 ) $ 6,631

Income (loss) from discontinued operations, net of tax $ ( 29,340 ) $ 2,382 $ 5,920

Net Income (loss) $ ( 29,742 ) $ ( 30,015 ) $ 12,551

Weighted-average shares outstanding—basic 46,333 48,278 48,739

1 unchanged sentence

Weighted-average shares outstanding—diluted $ 46,333 $ 48,278 $ 51,633

Basic earnings (loss) per share - continuing operations $ ( 0.01 ) $ ( 0.67 ) $ 0.14

Diluted earnings (loss) per share - continuing operations $ ( 0.01 ) $ ( 0.67 ) $ 0.13

Basic earnings (loss) per share - discontinued operations $ ( 0.63 ) $ 0.05 $ 0.12

Diluted earnings (loss) per share - discontinued operations $ ( 0.63 ) $ 0.05 $ 0.11

Basic earnings (loss) per share $ ( 0.64 ) $ ( 0.62 ) $ 0.26

Diluted earnings (loss) per share $ ( 0.64 ) $ ( 0.62 ) $ 0.24

Shares issuable from stock-based awards (1)

2,579 1,293 —

Shares excluded from the calculation of diluted earnings per share (2)

487 2,279 506

(1) Represents shares excluded from the computation of shares contingently issuable upon exercise as we recognized a net loss from continuing operations.

(2) Represents outstanding stock-based awards that were anti-dilutive and excluded from the calculation of diluted earnings per share.

DHI GROUP, INC.

1 unchanged sentence

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The following is a summary of unaudited quarterly results of operations for 2020 and 2019:

The following is a summary of unaudited quarterly results of operations for 2021 and 2020 and has been restated to reflect the transfer of majority ownership and control of the eFC business to eFC's management, which is presented as a discontinued operation, as described in note 4:

For the Three Months Ended

4 unchanged sentences

Operating income (loss) $ ( 184 ) $ 488 $ ( 2,215 ) $ 159

Income (loss) from continuing operations 2,012 ( 212 ) ( 2,434 ) 232

Income (loss) from discontinued operations, net of tax 659 ( 29,999 ) — —

Net income (loss) $ 2,671 $ ( 30,211 ) $ ( 2,434 ) $ 232

Basic earnings (loss) per common share $ ( 0.13 ) $ 0.04 $ ( 0.57 ) $ 0.04 [1]

Diluted earnings (loss) per common share $ ( 0.13 ) $ 0.04 $ ( 0.57 ) $ 0.04 [1]

Basic income (loss) per share - continuing operations $ 0.04 $ — $ ( 0.05 ) $ 0.01 (1)

Diluted income (loss) per share - continuing operations $ 0.04 $ — $ ( 0.05 ) $ — (1)

Basic earnings (loss) per share - discontinued operations $ 0.01 $ ( 0.64 ) $ — $ — (1)

Diluted earnings (loss) per share - discontinued operations $ 0.01 $ ( 0.64 ) $ — $ — (1)

Basic earnings (loss) per share $ 0.06 $ ( 0.64 ) $ ( 0.05 ) $ 0.01 (1)

Diluted earnings (loss) per share $ 0.05 $ ( 0.64 ) $ ( 0.05 ) $ — (1)

Revenues $ 29,385 $ 27,596 $ 27,149 $ 27,037

Total operating expenses 35,955 25,941 55,627 26,034

Other operating income (loss) $ — $ ( 537 ) $ — $ — [2]

Operating income $ 3,592 $ 3,765 $ 5,273 $ 4,395

Net income $ 1,588 $ 3,061 $ 4,381 $ 3,521

Basic earnings per common share $ 0.03 $ 0.06 $ 0.09 $ 0.07 [1]

Diluted earnings per common share $ 0.03 $ 0.06 $ 0.08 $ 0.07 [1]

[1] The sum of the quarter may not equal the full year amount.

[2] Escrow and working capital terms and related contingencies were finalized regarding the Hcareers's sale resulting in an additional loss on the sale.

Operating income (loss) $ ( 6,570 ) $ 1,655 $ ( 28,478 ) $ 1,003

Income (loss) from continuing operations ( 7,535 ) 1,162 ( 26,993 ) $ 969

Income (loss) from discontinued operations, net of tax 985 700 ( 329 ) $ 1,026

Net income (loss) $ ( 6,550 ) $ 1,862 $ ( 27,322 ) $ 1,995

Basic income (loss) per share - continuing operations $ ( 0.15 ) $ 0.02 $ ( 0.56 ) $ 0.02 (1)

Diluted income (loss) per share - continuing operations $ ( 0.15 ) $ 0.02 $ ( 0.56 ) $ 0.02 (1)

Basic earnings (loss) per share - discontinued operations $ 0.02 $ 0.01 $ ( 0.01 ) $ 0.02 (1)

Diluted earnings (loss) per share - discontinued operations $ 0.02 $ 0.01 $ ( 0.01 ) $ 0.02 (1)

Basic earnings (loss) per share $ ( 0.13 ) $ 0.04 $ ( 0.57 ) $ 0.04 (1)

Diluted earnings (loss) per share $ ( 0.13 ) $ 0.04 $ ( 0.57 ) $ 0.04 (1)

(1) The sum of the quarters may not equal the full year amount.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data