What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-02-08 compared with 2023-02-10 · 172 added, 193 removed, 799 unchanged (31% of the section changed)

45 unchanged sentences

The Company determined the fair value of its reporting unit by using a combination of a discounted cash flow methodology and a market comparable method.

Similarly, the Company’s evaluation of its indefinite lived trademark and brand intangible asset (“Dice”) involves the comparison of the fair value to its carrying value.

The Company determined the fair value of Dice using a relief from royalty rate valuation method.

The determination of the fair value for the Company’s reporting unit (“Tech-focused”) is judgmental and required management to make significant estimates and assumptions including forecasts of future revenue, EBITDA margin and the discount rate.

The Company’s evaluation of its indefinite lived trademark and brand intangible asset (“Dice”) involves the comparison of the fair value to its carrying value.

The Company determined the fair value of Dice using a relief from royalty rate valuation method.

The determination of the fair value of Dice required management to make significant estimates and assumptions including forecasts of future revenue, the royalty rate and the discount rate.

2 unchanged sentences

The carrying value of Dice was $23.8M as of December 31, 2023.The fair value of Dice exceeded its carrying value as of the measurement date, October 1, 2023, and therefore no impairment was recognized.

Given the significant estimates and assumptions management makes to estimate the fair value of goodwill and the Dice brand, performing auditing procedures to evaluate the reasonableness of management’s forecasts of revenue, EBITDA margin, the royalty rate and 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.

Given the significant estimates and assumptions management makes to estimate the fair value of the Tech-focused reporting unit and the Dice brand, performing auditing procedures to evaluate the reasonableness of management’s forecasts of revenue, EBITDA margin, the royalty rate and 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, EBITDA margins and selection of the royalty and discount rates used by management to estimate the fair value of Tech-focused and Dice included the following, among others:

• We tested the effectiveness of controls over management’s goodwill and Dice brand intangible asset impairment tests, including controls related to management’s forecasts of revenue, EBITDA margin, royalty rate and the discount rates.

• We tested the effectiveness of controls over the Tech-focused reporting unit and Dice trademarks and brand name impairment tests, including controls related to management’s forecasts of revenue, EBITDA margin, royalty rate and the discount rates.

• We evaluated management’s ability to accurately forecast revenue growth rates and EBITDA margin by comparing actual results to management’s historical forecasts.

• We evaluated the reasonableness of management’s forecasts of revenues by comparing the forecasts of revenues to external market sources.

• With the assistance of our fair value specialists we evaluated the reasonableness of management’s selected long-term growth rate for revenue by comparing it to industry projections.

• With the assistance of our fair value specialists we evaluated the reasonableness of management’s selected royalty rate by comparing it to those of industry participants from external sources.

• With the assistance of our fair value specialists we evaluated the reasonableness of management’s selected discount rates by computing an independent estimate of those rates.

• With the assistance of our fair value specialists we evaluated the reasonableness of management’s selected discount rates by computing an independent estimate of those rates and the revenue growth rate through a peer analysis.

• We evaluated the reasonableness of management’s evaluation over ASC 350 qualitative impairment indicators of potential triggering events.

• We evaluated the reasonableness of management’s forecasts of revenues and EBITDA through the fiscal year-end date by comparing the fourth quarter forecast to actuals.

/s/ Deloitte & Touche LLP

7 unchanged sentences

Current assets

Cash and cash equivalents $ 3,006 $ 1,540

Cash $ 4,206 $ 3,006

Accounts receivable, net of allowance for doubtful accounts of $ 1,313 and $ 1,374

7 unchanged sentences

Investments 1,918 5,646

Investments, at fair value — 3,000

Acquired intangible assets 23,800 23,800

44 unchanged sentences

Depreciation 16,915 17,487 16,344

Impairment of intangible assets — — 15,200

Impairment of goodwill — — 22,607

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

Restructuring 2,417 — —

Total operating expenses 145,590 146,181 121,655

3 unchanged sentences

Income from equity method investment 502 1,597 190

Impairment of investment ( 2,300 ) — ( 2,002 )

Gain on investments 614 320 1,198

Impairment of investment ( 300 ) ( 2,300 ) —

Interest expense and other ( 3,482 ) ( 1,580 ) ( 667 )

Income (loss) before income taxes 3,622 3,597 ( 1,031 )

Income tax benefit ( 579 ) ( 629 ) ( 2,826 )

Income tax expense (benefit) 131 ( 579 ) ( 629 )

Income (loss) from continuing operations 3,491 4,176 ( 402 )

34 unchanged sentences

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 ) 874 ( 2,248 ) ( 2,252 )

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

Performance-based restricted stock unites 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

Net loss ( 29,742 ) ( 29,742 )

Other comprehensive income 395 395

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

Net income 4,176 4,176

Other comprehensive loss ( 420 ) ( 420 )

Stock based compensation 9,519 9,519

3 unchanged sentences

Performance based restricted stock forfeited or withheld to satisfy tax obligations ( 93 ) ( 1 ) 1 368 ( 1,958 ) ( 1,958 )

Issuance of common stock upon ESPP purchase 68 1 286 287

Purchase of treasury stock under stock repurchase plan 3,287 ( 18,530 ) ( 18,530 )

1 unchanged sentence

Net income 3,491 3,491

Other comprehensive loss ( 420 ) ( 420 )

Other comprehensive income 198 198

Cumulative translation adjustments reclassified to the Statements of Operations 200 200

Stock based compensation 9,916 9,916

4 unchanged sentences

Issuance of common stock upon ESPP purchase 114 1 298 299

Cumulative-effect of new accounting principle (See Note 2) 332 332

Purchase of treasury stock under stock repurchase plan 1,661 ( 6,896 ) ( 6,896 )

15 unchanged sentences

Income from equity method investment ( 502 ) ( 1,597 ) ( 190 )

Impairment of intangible assets — — 15,200

Impairment of goodwill — — 23,626

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

Impairment of investment 2,300 — 2,002

Gain on investments ( 614 ) ( 320 ) ( 1,198 )

Impairment of investment 300 2,300 —

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

Change in accrual for unrecognized tax benefits 263 ( 16 ) ( 156 )

11 unchanged sentences

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

Cash received from sale of business, net — — —

Cash paid for investment — — ( 3,000 )

Cash received from sale of investment 320 1,198 200

Cash received from sale of investments 4,941 320 1,198

Purchases of fixed assets ( 20,252 ) ( 17,976 ) ( 14,307 )

9 unchanged sentences

Effect of exchange rate changes — — 10

Net change in cash and cash equivalents for the period 1,466 ( 6,100 ) 2,259

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

Cash and cash equivalents, end of period $ 3,006 $ 1,540 $ 7,640

Net change in cash for the period 1,200 1,466 ( 6,100 )

Cash, beginning of period 3,006 1,540 7,640

Cash, end of period $ 4,206 $ 3,006 $ 1,540

See accompanying notes to consolidated financial statements.

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Its mission is to empower tech professionals and organizations to compete and win through expert insights and relevant employment connections.

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.

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 our websites and services to find ideal employment opportunities, relevant job advice and tailored career-related data.

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.

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, which was reduced to 10 % in the third quarter of 2023.

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.

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 Statements of Operations for the year ended December 31, 2021.

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 .

30 unchanged sentences

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

Cash and cash equivalents— Cash equivalents consist of demand deposits and highly liquid investments which have an original maturity of three months or less.

Concentration of Credit Risk— Cash and cash equivalents are maintained with several financial institutions.

Cash and cash equivalents potentially subject the Company to a concentration of credit risk as substantially all of its deposits held in financial institutions were in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits as of December 31, 2022 and 2021.

Cash— Cash consists of demand deposits with financial institutions.

Concentration of Credit Risk— Cash is maintained with several financial institutions.

Cash potentially subjects the Company to a concentration of credit risk as substantially all of its deposits held in financial institutions were in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits as of December 31, 2023 and 2022.

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

2 unchanged sentences

If the financial condition of DHI’s customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.

Statements of Cash Flows— All bank deposits are considered cash and cash equivalents.

Statements of Cash Flows— All bank deposits are considered cash.

The supplemental disclosures to the accompanying consolidated statements of cash flows are as follows (in thousands):

5 unchanged sentences

Capital expenditures on fixed assets included in accounts payable and accrued expenses 1,009 327 144

Share repurchases included in accounts payable and accrued expenses — — 141

Fixed Assets— Depreciation of equipment, furniture and fixtures, computer software and capitalized website development costs are provided under the straight-line method over estimated useful lives ranging from two to five years .

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

Depreciation 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 improvements is capitalized, and repairs and maintenance costs are charged to operations in the periods incurred.

3 unchanged sentences

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

Cloud Computing Arrangements— The Company incurs costs to implement cloud computing arrangements that are hosted by third party vendors.

Implementation costs associated with cloud computing arrangements are capitalized when incurred during the application-development stage.

The capitalized costs are amortized on a straight-line basis over approximately three years , which reflects the estimated useful life or contractual term of the underlying contract.

Capitalized amounts related to such arrangements are recorded within other non-current assets in the Consolidated Balance Sheets.

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

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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, 2022.

For costs incurred to obtain new business sales contracts, the Company capitalizes and expenses these costs over an average customer life, which was approximately three years as of December 31, 2023.

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, 2023.

12 unchanged sentences

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.

Equity Method Investments— The Company has a 40 % non-controlling common share interest in the eFC (adjusted to 10 % as of the third quarter of 2023) and Rigzone (adjusted to zero percent as of the second quarter of 2022) businesses as the Company does not have the ability to direct the activities of the businesses that most significantly impact their economic performance.

The common share interests in eFC and Rigzone, during the periods of ownership, are 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.

The Company sold its 40 % common share interest in Rigzone in the second quarter of 2022.

See Note 7 for additional disclosures.

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

Advertising expense for the years ended December 31, 2022, 2021 and 2020 was $ 17.9 million, $ 12.5 million and $ 10.9 million, respectively.

Advertising expense for the years ended December 31, 2023, 2022 and 2021 were $ 14.9 million, $ 17.9 million and $ 12.5 million, respectively.

Income Taxes— The Company recognizes deferred taxes by the asset and liability method.

1 unchanged sentence

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, depreciation of fixed assets, and capitalized contract costs.

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

DHI GROUP, INC.

3 unchanged sentences

See Note 15 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.

Fair Value of Financial Instruments— The carrying amounts reported in the consolidated balance sheets for cash, 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.

18 unchanged sentences

The guidance replaces the current "incurred loss" model with an "expected loss" model that requires consideration of a broader range of information to estimate expected credit losses over the lifetime of a financial asset.

ASU 2016-13 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2022 for Smaller Reporting Companies.

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

In August 2018, the FASB issued ASU No.

2018-15, Intangibles-Goodwill and Other-Internal-Use Software:

Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract.

The new standard requires entities that are customers in cloud computing arrangements to defer implementation costs if they would be capitalized by the entity in software licensing arrangements under the internal-use software guidance.

2018-15 is effective for fiscal years beginning after December 15, 2019 and interim periods within those years.

The amendments allow either a retrospective or prospective approach to all implementation costs incurred after adoption.

The Company adopted this standard, effective January 1, 2020, under the prospective approach, and capitalized implementation costs are included in other assets on the Company's balance sheet.

In December 2019, the FASB issued ASU No.

2019-12, Simplifying the Accounting for Income Taxes , which eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating taxes during interim quarters and the recognition of deferred tax liabilities for outside basis differences.

This guidance also simplifies aspects of accounting for franchise taxes, specifies the timing for recognizing certain income tax effects of changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill.

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

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company adopted ASU 2016-13 on January 1, 2023, under the modified retrospective method as required by the standard.

The Company recorded a cumulative-effect adjustment of $ 0.3 million to increase accumulated earnings and reduce the allowance for doubtful accounts as of January 1, 2023.

Prior period amounts were not adjusted and will continue to be reported under the accounting standards in effect for the period presented.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures .

The new accounting standard relates to disclosures about a public entity’s reportable segments and provides more detailed information about a reportable segment’s expenses.

The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024, with retrospective application required.

We are evaluating the effect of the standard on our consolidated financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures .

The new accounting standard requires more detailed disclosures regarding the effective tax rate reconciliation and income taxes paid.

The standard is effective for fiscal years beginning after December 15, 2024, and may be applied on either a prospective or retrospective basis, with early adoption permitted.

We are evaluating the effect of the standard on our consolidated financial statement disclosures.

FAIR VALUE MEASUREMENTS

1 unchanged sentence

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.

1 unchanged sentence

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

Investments, non-current that were carried at fair value, prior to the conversion to preferred shares as described in Note 7, used 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 2022 period prior to the conversion.

11 unchanged sentences

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

During the third quarter of 2023, the Company sold a portion of its ownership in eFC reducing its total interest in eFC from 40 % to 10 %.

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.

2 unchanged sentences

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 statements of operations.

As further described in Notes 1 and 7, 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 statements of operations for the year ended December 31, 2021.

The results of discontinued operations on the consolidated statements of operations were as follows for the year ended December 31, 2021 (in thousands):

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Revenues $ 12,130

3 unchanged sentences

Other income 1

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

Loss before income taxes ( 28,893 )

Income tax expense 447

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

Net loss $ ( 29,340 )

(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.

5 unchanged sentences

Operating cash flows from operating leases $ 804

During the third quarter of 2023, the Company sold a portion of its ownership in eFC reducing its total interest in eFC from 40 % to 10 %.

REVENUE RECOGNITION

39 unchanged sentences

The leases have terms from one year to ten 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.

Our recorded lease right-of-use asset and lease liability were each reduced $ 2.1 million as of December 31, 2022, which represents a tenant improvement allowance that is expected to be consumed in 2023.

Our recorded lease right-of-use asset and lease liability were each reduced $ 2.1 million as of December 31, 2022, which represents a tenant improvement allowance that was consumed in 2023.

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

17 unchanged sentences

$ — $ 1,542 $ —

(1) During the year ended December 31, 2022, our right-of-use asset obtained in exchanged for lease obligations was reduced by $2.1 million, which represents a tenant improvement allowance expected to be consumed in 2023.

(1) During the year ended December 31, 2022, our right-of-use asset obtained in exchanged for lease obligations was reduced by $ 2.1 million, which represents a tenant improvement allowance that was consumed in 2023.

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

8 unchanged sentences

$ 8,549 $ 8,533

Weighted average remaining lease term - operating leases 5.8 years 3.6 years

Weighted average discount rate - operating leases 4.4 % 3.8 %

(1) At December 31, 2022, our right-of-use asset includes a reduction of $ 2.1 million, which represents a tenant improvement allowance expected to be consumed in 2023.

Weighted Average Remaining Lease Terms (in years)

Operating leases 6.2 years 5.8 years

Weighted Average Discount Rate

Operating leases 4.5 % 4.4 %

(1) At December 31, 2022, our right-of-use asset includes a reduction of $ 2.1 million, which represents a tenant improvement allowance that was consumed in 2023.

The Company reviews its right-of-use ("ROU") assets for impairment if indicators of impairment exist.

3 unchanged sentences

No impairment was recorded during the years ended December 31, 2023 and 2022.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2023, future operating lease payments were as follows (in thousands):

4 unchanged sentences

tenant improvement allowance —

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2023, the Company has no additional operating or finance leases that have not yet commenced.

9 unchanged sentences

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.

10 unchanged sentences

Accordingly, the Company recognized an impairment loss during the year ended December 31, 2022 of $ 2.3 million.

During the third quarter of 2023, the majority investor purchased additional shares of the business as was contemplated in, and at the same price as, in the Qualified Financing and additional equity based compensation was issued to the investment's management team.

As a result, the majority investor's ownership was reduced to 44.8 % and the Company's ownership was reduced to 4.1 %, both on a fully-diluted basis, as of December 31, 2023.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

During the third quarter of 2023, the investment's financial position deteriorated.

To meet its financial obligations, the investment issued convertible debt (the "Convertible Debt") at a price that indicated the value of the investment had declined.

As such, the Company revalued its investment to $ 0.4 million and accordingly, recognized an impairment loss of $ 0.3 million during the third quarter of 2023.

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

10 unchanged sentences

The settlement is recorded as proceeds from settlement in the consolidated statements of operations for the year ended December 31, 2022.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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.

During the third quarter of 2023, the Company sold a portion of its ownership in eFC reducing its total interest in eFC from 40 % to 10 %.

As a result of the sale, the Company received cash of $ 4.9 million and recognized a $ 0.6 million gain, which included a $ 0.2 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 Company has evaluated its common share interest in the eFC 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.

3 unchanged sentences

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 .

Accordingly, the Company recorded amortization of $ 0.1 million during the year ended December 31, 2023.

The amortization was not material for the years ended December 31, 2022 and 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 years ended December 31, 2022 and 2021, the Company recorded $ 1.6 million and $ 0.2 million, respectively, of income related to its proportionate share of eFC's net income, net of currency translation adjustments and amortization of the basis difference.

As of December 31, 2019, the Company held preferred stock representing a 7.6% interest in the fully diluted shares of a tech skills assessment company.

As of December 31, 2019 it was not practicable to estimate the fair value of the preferred stock as the shares were 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, 2022, 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, 2022.

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.

During the years ended December 31, 2023, 2022 and 2021, the Company recorded $ 0.5 million, $ 1.6 million and $ 0.2 million, respectively, of income related to its proportionate share of eFC's net income, net of currency translation adjustments and amortization of the basis difference.

At December 31, 2023, the Company held preferred stock representing a 7.3 % interest in the fully diluted shares of a tech skills assessment company.

The investment is recorded at zero as of December 31, 2023 and 2022.

The Company recorded no gain or loss related to the investment during the years ended December 31, 2023, 2022, and 2021.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FIXED ASSETS, NET

8 unchanged sentences

During the years ended December 31, 2023, 2022, and 2021, depreciation expense was $ 16.9 million, $ 17.5 million, and $ 16.3 million, respectively.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ACQUIRED INTANGIBLE ASSETS, NET

As of December 31, 2023 and 2022, the Company had an indefinite-lived acquired intangible asset of $ 23.8 million related to the Dice trademarks and brand name.

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.

3 unchanged sentences

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

As of December 31, 2022 and 2021, the Company had an indefinite-lived acquired intangible asset of $ 23.8 million related to the Dice trademarks and brand name.

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.

The impairment test performed as of October 1, 2023 resulted in the fair value of the Dice trademarks and brand name exceeding the carrying value by 51 %.

The Company's operating results attributable to the Dice trademarks and brand name for the fourth quarter of 2023 and estimated future results as of December 31, 2023 approximate the projections used in the October 1, 2023 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, 2023.

Therefore, no quantitative impairment test was performed as of December 31, 2023.

No impairment was recorded during the years ended December 31, 2023, 2022 and 2021.

The projections utilized in the October 1, 2022 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.

The October 1, 2022 analysis included operating margins during the year ending December 31, 2022 that approximate operating margins for the year ended December 31, 2021 and then increasing modestly.

The Company’s ability to achieve the projections used in the October 1, 2023 analysis may be impacted by, among other things, 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.

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.

The Company's operating results attributable to the Dice trademarks and brand name through December 31, 2022 and projections of future results approximate those included in the projections utilized in the October 1, 2022 analysis.

In the October 1, 2022 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 licensing agreements and the profitability attributable to the Dice trademarks an brand name and a discount rate of 12.0 %.

In the October 1, 2023 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 %, which is based on comparable industry licensing agreements and the profitability attributable to the Dice trademarks and brand name, and a discount rate of 13.1 %.

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.

Fair values are determined using a profit allocation methodology which estimates the value of the trademark and brand name by capitalizing the profits saved because the company owns the asset.

We consider factors such as historical performance, anticipated market conditions, operating expense trends and capital expenditure requirements.

Changes in our strategy, uncertainty related to COVID-19, and/or changes in market conditions could significantly impact these judgments and require adjustments to recorded amounts of intangible assets.

We consider factors such as historical performance, anticipated market conditions, revenues, operating expense trends and capital expenditure requirements.

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

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

The following table shows the carrying amount of goodwill as of December 31, 2022 and 2021, and the changes in goodwill for the years then ended (in thousands):

Goodwill at January 1, 2020 $ 150,707

Impairment ( 22,607 )

Goodwill at December 31, 2020 $ 128,100

Activity during 2021 —

Goodwill at December 31, 2021 $ 128,100

Activity during 2022 —

Goodwill at December 31, 2022 $ 128,100

Accumulated impairment losses at December 31, 2022, 2021 and 2020 was $ 22.6 million.

Goodwill as of December 31, 2022 and 2021, which was allocated to the Tech-focused reporting unit, was $ 128.1 million.

As of December 31, 2023, the Company has goodwill of $ 128.1 million, which was all allocated to the Tech-focused reporting unit.

There were no changes to goodwill during the years ended December 31, 2023, 2022, and 2021.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

The results of the impairment test indicated that the fair value of the Tech-focused reporting unit was substantially in excess of the carrying value as of October 1, 2022.

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

In testing goodwill for impairment, a qualitative assessment can be performed and if it is determined that the fair value of the reporting unit is more likely than not less than the carrying amount, the impairment review process compares the fair value of the reporting unit in which the goodwill resides to the carrying value of that reporting unit.

If the fair value of the reporting unit is less than its carrying amount, an impairment charge is recorded for the amount the carrying value exceeds the fair value.

Our annual impairment test for goodwill is performed on October 1 of each year.

The annual impairment test for the Tech-focused reporting unit performed as of October 1, 2023 resulted in the fair value of the reporting unit being substantially in excess of the carrying value.

Results for the Tech-focused reporting unit for the fourth quarter of 2023 and estimated future results as of December 31, 2023 approximate the projections used in the October 1, 2023 analysis.

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Therefore, no quantitative impairment test was performed as of December 31, 2023.

During the third quarter of 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.

There were no changes to goodwill and no impairments were recorded during the years ended December 31, 2022 and 2021.

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

The October 1, 2022 analysis included operating margins during the year ending December 31, 2022 that approximate operating margins for the year ended December 31, 2021 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.

No impairment was recorded during the years ended December 31, 2023, 2022 and 2021.

The discount rate applied for the Tech-focused reporting unit in the October 1, 2023 analysis was 12.1 %.

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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, 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.

In addition, a future decline in the overall market conditions, 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.

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.

Fair values are determined either by using a discounted cash flow methodology or by using a combination of a discounted cash flow methodology and a market comparable method.

Fair values are determined by using a combination of a discounted cash flow methodology and a market comparable method.

The discounted cash flow methodology is based on projections of the amounts and timing of future revenues and cash flows, assumed discount rates and other assumptions as deemed appropriate.

Factors such as historical performance, anticipated market conditions, operating expense trends and capital expenditure requirements are considered.

Additionally, the discounted cash flows analysis takes into consideration cash expenditures for product development, other technological updates and advancements to the websites and investments to improve the candidate databases.

We consider factors such as historical performance, anticipated market conditions, operating expense trends and capital expenditure requirements.

Additionally, the discounted cash flows analysis takes into consideration cash expenditures for product development, other technological updates and advancements to our websites and investments to improve our candidate databases.

The market comparable method indicates the fair value of a business by comparing it to publicly traded companies in similar lines of business or to comparable transactions or assets.

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Unamortized debt issuance costs from the previous credit agreement of $ 0.2 million and debt issuance costs of $ 0.5 million related to the new agreement were recorded as other assets on the consolidated balance sheets and are recorded to interest expense over the term of the Credit Agreement.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Borrowings under the Credit Agreement denominated in U.S.

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The margin ranges from 2.00 % to 2.75 % on SOFR and SONIA loans and 1.00 % to 1.75 % on base rate loans, determined by the Company’s most recent consolidated leverage ratio, plus an additional spread of 0.10 %.

The Company incurs a commitment fee ranging from 0.35 % to 0.50 % on any unused capacity under the revolving loan facility, determined by the Company’s most recent consolidated leverage ratio.

There were no borrowings in pounds sterling as of December 31, 2022 and December 31, 2021.

The Company incurs a commitment fee

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ranging from 0.35 % to 0.50 % on any unused capacity under the revolving loan facility, determined by the Company’s most recent consolidated leverage ratio.

There were no borrowings in pounds sterling as of December 31, 2023 and 2022.

The facility may be prepaid at any time without penalty.

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There was no penalty for prepayment of the Old Credit Agreement.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The amounts borrowed as of December 31, 2023 and 2022 are as follows (dollars in thousands):

2023 December 31,

Amounts borrowed:

Revolving credit facility $ 30,000 $ 23,000

deferred financing costs, net of accumulated amortization of $ 467 as of December 31, 2021 (1)

Total borrowed $ 30,000 $ 22,730

Long-term debt under revolving credit facility (1)

$ 38,000 $ 30,000

Available to be borrowed under revolving facility (2)

$ 62,000 $ 70,000

Interest rates:

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Interest margin (3)

2.35 % 2.35 %

Actual interest rates 7.71 % 6.67 %

Commitment Fee 0.40 % 0.40 %

(1) In connection with the new Credit Agreement entered into during the second quarter of 2022, the Company recorded deferred financing costs of $ 0.7 million to other assets on the consolidated balance sheets.

Accumulated amortization as of December 31, 2022 was less than $ 0.1 million.

(1) In connection with the Credit Agreement, during the second quarter of 2022, the Company recorded deferred financing costs of $ 0.7 million recorded to other assets on the condensed consolidated balance sheets.

Accumulated amortization as of December 31, 2023 was $ 0.2 million.

(2) The amount available to be borrowed is subject to certain limitations, such as a consolidated leverage ratio, as defined in the Credit Agreement.

(3) Includes additional spread of 0.10 %.

There are no scheduled payments until maturity of the Credit Agreement in June 2027.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

COMMITMENTS AND CONTINGENCIES

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Management has discretion in determining the conditions under which shares may be purchased from time to time.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the stock repurchase plans approved by the Board of Directors:

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

May 2020 to May 2021 (1)

Feb 2021 to Jun 2022 (2)

Feb 2022 to Feb 2023 (3)

Approval Date April 2019 May 2020 February 2021 February 2022

Feb 2023 to Feb 2024 (4)

Approval Date May 2020 February 2021 February 2022 February 2023

Authorized Repurchase Amount of Common Stock $ 5 million $ 20 million $ 15 million $ 10 million

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During the first quarter of 2022, the Company completed its purchases under the plan, which consisted of approximately 4.4 million shares for $ 20.0 million, effectively ending the plan prior to its original expiration date.

(3) On February 15, 2022 the Company announced that its Board of Directors approved a new stock repurchase program that permits the purchase of up to $ 15.0 million of the Company's common stock through February 2023.

(3) During February 2023, the stock repurchase program approved in February 2022 expired with a total of 2.6 million shares purchased for $ 14.7 million.

(4) On February 9, 2023, the Company announced that its Board approved a new stock repurchase program that permits the purchase of up to $ 10.0 million of the Company's common stock through February 2024.

As of December 31, 2023, the value of shares available to be purchased under the current plan was $ 4.8 million.

Subsequent to December 31, 2022, the Company's Board of directors announced a new stock repurchase program that permits the repurchase of up to $ 10 million of the Company's common stock through February 2024.

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

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There were 19,220 and 48,260 unsettled shares as of December 31, 2022 and 2021, respectively.

Stock Repurchases Pursuant to the 2022 Omnibus Equity Award Plan -Under the 2022 Omnibus Equity Award Plan, as further described in Note 15 to the consolidated financial statements, the Company repurchases its common stock withheld for income tax from vesting of employee restricted stock or performance-based restricted stock units ("PSUs").

No shares were unsettled as of December 31, 2023.

Stock Repurchases Pursuant to the 2022 Omnibus Equity Award Plan, as Amended and Restated -Under the 2022 Omnibus Equity Award Plan, as Amended and Restated as further described in Note 15 to the consolidated financial statements, the

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Company repurchases its common stock withheld for income tax from the vesting of employee restricted stock or ("PSUs").

The Company remits the value, which is based on the closing share price on the vesting date of the common stock withheld to the appropriate tax authority on behalf of the employee and the related shares become treasury stock.

Purchases of the Company's common stock pursuant to the 2022 Omnibus Equity Award Plan were as follows:

Purchases of the Company's common stock pursuant to the 2022 Omnibus Equity Award Plan, as Amended and Restated were as follows:

Year Ended December 31,

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The Company’s amended and restated certificate of incorporation permits the terms of any preferred stock to be determined at the time of issuance.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Dividend provisions

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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, 2022, and 2020.

The foreign currency translation adjustments impact comprehensive income.

The Company had no amounts reclassified out of accumulated other comprehensive income for the year ended December 31, 2022.

During the year ended December 31, 2023, the Company had $ 0.2 million of currency translation adjustments reclassified to the Statements of Operations related to selling a portion of its eFC ownership.

The foreign currency translation adjustments impact

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

comprehensive income.

Accumulated other comprehensive income (loss), net consists of the following components, net of tax (in thousands):

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The 2022 Omnibus Equity Award Plan generally mirrors the terms of the Company's prior omnibus equity award plan, which expired in accordance with its terms on April 20, 2022 (the "2012 Omnibus Equity Award Plan").

The Company has previously granted restricted stock and PSUs to certain employees and directors pursuant to the 2012 Omnibus Equity Award Plan and continues to grant restricted stock and PSUs to certain employees and directors pursuant to the 2022 Omnibus Equity Award Plan.

On April 26, 2023, the stockholders of the Company approved the DHI Group, Inc.

2022 Omnibus Equity Award Plan, as Amended and Restated, which had been previously approved by the Company’s Board of Directors on March 16, 2023 (the "2022 Omnibus Equity Award Plan, as Amended and Restated").

The 2022 Omnibus Equity Award Plan was amended and restated to, among other things, increase the number of shares of common stock authorized for issuance as equity awards under the plan by 2.9 million shares.

The Company also offers an Employee Stock Purchase Plan.

Stock-based compensation disclosures within this note include expense and shares related to the eFC business through June 30, 2021.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company recorded stock based compensation expense of $ 9.9 million, $ 9.5 million, and $ 8.3 million during the years ended December 31, 2023, 2022, and 2021, respectively.

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A summary of the status of restricted stock awards as of December 31, 2023, 2022, and 2021 and the changes during the periods then ended is presented below:

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Year Ended December 31,

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PSUs— PSUs are granted to employees of the Company and its subsidiaries.

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 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 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 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.

For the performance period ended December 31, 2020, as a result of the COVID-19 pandemic and its impact on the overall economy, the bookings targets were modified during the third quarter of 2020.

Accordingly, the Company remeasured the awards.

There were no cash flow impact resulting from the grants.

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

There were no cash flow impacts resulting from the grants.

A summary of the status of PSUs as of December 31, 2023, 2022, and 2021 and the changes during the periods then ended, is presented below:

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Expected to vest 1,616,962 $ 4.52 2,086,933 $ 3.48 1,593,775 $ 2.62

(1) PSUs granted includes 853,332 additional PSUs granted in the first quarter of 2022 related to the bookings achievement for the performance period ended December 31, 2021.

(1) PSUs granted includes 587,587 additional PSUs granted in the first quarter of 2023 related to the bookings achievement for the performance period ended December 31, 2022 and 853,332 additional PSUs granted in the first quarter of 2022 related to the bookings achievement for the performance period ended December 31, 2021.

(2)PSUs forfeited includes 48,633 PSUs forfeited in the first quarter of 2021 related to the bookings achievement for the performance period ended December 31, 2020.

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.

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

The risk-free rate for periods within the expected life of the option is based on the U.S.

Treasury rates in effect at the time of grant.

The stock options vest 25% after one year, beginning on the first anniversary date of the grant, and 6.25% each quarter following the first anniversary.

There was no cash flow impact resulting from the grants.

No stock options were granted during the years ended December 31, 2022, 2021, and 2020.

There were no options outstanding as of December 31, 2022.

A summary of the status of options previously granted as of December 31, 2021, and 2020, and the changes during the periods then ended is presented below:

Year Ended December 31, 2021

Options Weighted-Average Exercise Price Aggregate Intrinsic Value

Options outstanding at January 1 110,000 $ 7.40 $ —

Forfeited ( 110,000 ) $ 7.40 —

Options outstanding at December 31 — $ — $ —

Exercisable at December 31 — $ — $ —

Year Ended December 31, 2020

Options Weighted-Average Exercise Price Aggregate Intrinsic Value

Options outstanding at January 1 190,000 $ 8.28 $ —

Forfeited ( 80,000 ) $ 9.48 —

Options outstanding at December 31 110,000 $ 7.40 $ —

Exercisable at December 31 110,000 $ 7.40 $ —

Stock Options— No stock options were granted during the years ended December 31, 2023, 2022, and 2021, and there were no stock options outstanding as of December 31, 2023, 2022 and 2021.

During the year ended December 31, 2021, 110,000 stock options were forfeited.

Employee Stock Purchase Plan— On March 11, 2020 the Company's Board of Directors adopted an Employee Stock Purchase Plan ("ESPP").

The ESPP was approved by the Company's stockholders on April 21, 2020.

The ESPP provides eligible employees the opportunity to purchase shares of the Company's common stock through payroll deductions during six-month

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

offering periods.

The ESPP provides eligible employees the opportunity to purchase shares of the Company's common stock through payroll deductions during six-month offering periods.

The purchase price per share of common stock is 85 % of the lower of the closing stock price on the first or last trading day of each offering period.

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The maximum number of shares of common stock available for purchase under the ESPP is 500,000 , subject to adjustment as provided under the ESPP.

Individual employee purchases are limited to $ 25,000 per calendar year, based on the fair market value of the shares on the purchase date.

The first offering period commenced January 1, 2022, and the second offering period commenced July 1, 2022.

During the year ended December 31, 2022, 67,905 shares were issued under the ESPP and the Company received $ 0.3 million of proceeds.

No shares were issued during the years ended December 31, 2021 and 2020.

Individual employee purchases are limited to $ 25,000 per calendar year, based on the fair market value of the shares

DHI GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

on the purchase date.

The first offering period commenced January 1, 2022.

During the years ended December 31, 2023 and 2022, 114,002 and 67,905 shares, respectively, were issued under the plan.

No shares were issued during the year ended December 31, 2021.

Deferred tax assets (liabilities) included in the balance sheet as of December 31, 2023 and 2022 are as follows (in thousands):

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Allowance for doubtful accounts 349 380

Depreciation of fixed assets 989 —

Provision for accrued expenses and other, net 893 1,040

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Stock-based compensation 2,505 2,692

Deferred revenue 215 142

Operating lease liabilities 2,102 2,066

Tax credit carryforward 311 303

30,745 11,919

Less valuation allowance 23,852 5,694

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Capitalized contract costs ( 1,578 ) ( 2,391 )

Operating lease assets ( 1,174 ) ( 1,608 )

Deferred tax liability ( 9,107 ) ( 11,740 )

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Federal statutory rate $ 760 $ 755 $ ( 216 )

Gain on sale of businesses or investments — ( 251 ) ( 42 )

Loss on sale of investments ( 22,881 ) — ( 251 )

Expiration of capital loss carryforward 4,680 — —

Stock-based compensation ( 399 ) ( 1,130 ) ( 84 )

Nondeductible impairment — — 5,029

State tax expense (benefit), net of federal effect 139 110 ( 514 )

State tax expense, net of federal effect 80 139 110

Change in accrual for unrecognized tax benefits 263 ( 16 ) ( 155 )

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Effective tax rate 3.6 % ( 16.1 ) % 61.0 %

(1) - Includes $0.5 million for deferred tax assets related to investments and $0.1 million of other items.

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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Increases in tax positions related to current year 282 194 165

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

Increases (decreases) in tax positions related to prior year 131 — ( 42 )

Lapse of statute of limitations ( 168 ) ( 190 ) ( 251 )

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

(1) For the twelve months ended December 31, 2021 and 2020, 2.6 million and 1.3 million shares, respectively, were excluded from the computation of shares contingently issuable upon exercise as we recognized a net loss from continuing operations.

(1) For the twelve months ended December 31, 2021, 2.6 million shares were 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.

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data