What changed in this filing

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Item 1. Financial Statements

2022-05-16 compared with 2021-11-12 · 89 added, 151 removed, 338 unchanged (42% of the section changed)

3 unchanged sentences

(in thousands, except par value)

September 30, December 31,

March 31, December 31,

Current Assets:

4 unchanged sentences

Inventory 17,331 19,329

Federal income tax receivable 11,538 11,538

Federal income tax receivable (Note 4) 11,538 11,538

Prepaid income taxes 54 51

15 unchanged sentences

Accrued liabilities 12,945 14,103

Line of credit — 417

Current operating leases 120 68

1 unchanged sentence

Total current liabilities 18,669 20,278

Line of credit — —

Deferred income tax liability 39,278 39,288

2 unchanged sentences

Total liabilities 60,883 62,596

Commitments and contingencies (Notes 6 and 9)

Commitments and contingencies (Note 9)

Stockholders’ Equity:

12 unchanged sentences

(in thousands, except earnings per share)

Three months ended Nine months ended

September 30, September 30,

2021 2020 2021 2020

Three months ended

Rental income $ 17,129 $ 15,341

5 unchanged sentences

Cost of rentals, exclusive of depreciation stated separately below

8,826 6,760 25,065 21,286

Cost of sales, exclusive of depreciation stated separately below

1,563 997 5,955 4,596

Cost of service and maintenance, exclusive of depreciation stated separately below

327 138 625 363

Selling, general and administrative expenses 2,502 2,649

1 unchanged sentence

Total operating costs and expenses 19,954 18,766

Operating loss ( 1,563 ) ( 941 ) ( 4,224 ) ( 1,362 )

Operating income (loss) 382 ( 369 )

Other income (expense):

Interest expense ( 24 ) ( 1 )

Other income, net 119 214 270 407

Other income (expense), net ( 32 ) 101

Total other income (expense), net ( 56 ) 100

Loss before provision for income taxes ( 1,469 ) ( 729 ) ( 3,994 ) ( 968 )

Income tax benefit 212 167 425 4,653

Net (loss) income $ ( 1,257 ) $ ( 562 ) $ ( 3,569 ) $ 3,685

(Loss) earnings per share:

Income (loss) before provision for income taxes 326 ( 269 )

Income tax benefit (expense) 11 ( 125 )

Net income (loss) $ 337 $ ( 394 )

Earnings (loss) per share:

Basic $ 0.03 $ ( 0.03 )

10 unchanged sentences

BALANCES, January 1, 2021

Compensation expense on common stock options — — — — 17 — — — 17

— $ — 13,296 $ 133 $ 112,615 $ 139,286 38 $ ( 490 ) $ 251,544

Issuance of restricted stock — — 62 — — — — — —

3 unchanged sentences

BALANCES, March 31, 2021

Compensation expense on common stock options — — — — 1 — — — 1

Issuance of restricted stock — — 13 — — — — — —

Compensation expense on restricted common stock — — — — 562 — — — 562

Net income — — — — — 165 — — 165

BALANCES, June 30, 2020 — — 13,286 133 111,489 141,725 38 ( 490 ) 252,857

Compensation expense on common stock options — — — — 1 — — — 1

Issuance of restricted stock — — 4 — — — — — —

Compensation expense on restricted common stock — — — — 562 — — — 562

Net loss — — — — — ( 562 ) — — ( 562 )

BALANCES, September 30, 2020 — $ — 13,290 $ 133 $ 112,052 $ 141,163 38 $ ( 490 ) $ 252,858

NATURAL GAS SERVICES GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands)

Preferred Stock Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Total Stockholders' Equity

Shares Amount Shares Amount Shares Amount

— $ — 13,358 $ 134 $ 112,864 $ 138,892 38 $ ( 490 ) $ 251,400

BALANCES, January 1, 2022

Issuance of restricted stock — — 62 — — — — — —

Compensation expense on restricted common stock — — — 1 473 — — — 474

Taxes paid related to net shares settlement of equity awards — — — — ( 224 ) — — — ( 224 )

Net loss — — — — — ( 394 ) — — ( 394 )

BALANCES, March 31, 2021 — — 13,358 134 112,864 138,892 38 ( 490 ) 251,400

— $ — 13,394 $ 134 $ 114,017 $ 130,103 775 $ ( 8,344 ) $ 235,910

Compensation expense on common stock options — — — — 21 — — — 21

Issuance of restricted stock — — 79 — — — — — —

3 unchanged sentences

Net loss — — — — — 337 — — 337

BALANCES, June 30, 2021 — — 13,394 134 113,175 136,974 213 ( 2,382 ) 247,901

Compensation expense on restricted common stock — — — — 421 — — — 421

Purchase of treasury shares — — — — — — 258 ( 2,540 ) ( 2,540 )

Net loss — — — — — ( 1,257 ) — — ( 1,257 )

BALANCES, September 30, 2021 — $ — 13,394 $ 134 $ 113,596 $ 135,717 471 $ ( 4,922 ) $ 244,525

BALANCES, March 31, 2022

— $ — 13,473 $ 135 $ 114,080 $ 130,440 1,022 $ ( 11,272 ) $ 233,383

See accompanying notes to these unaudited condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Nine months ended

September 30,

Three months ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Net (loss) income $ ( 3,569 ) $ 3,685

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Net income (loss) $ 337 $ ( 394 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 6,061 6,297

Amortization of debt issuance costs 12 —

Deferred income taxes ( 442 ) 233

Deferred income tax (benefit) expense ( 11 ) 123

Stock-based compensation 423 474

5 unchanged sentences

Inventory 2,085 ( 100 )

Federal income tax receivable — ( 11,083 )

Prepaid expenses and prepaid income taxes 238 301

1 unchanged sentence

Deferred income ( 1,312 ) ( 1,069 )

Deferred tax liability increase due to tax law change — 10,103

Other ( 89 ) 164

4 unchanged sentences

Proceeds from sale of property and equipment 37 —

Proceeds from sale of deferred compensation mutual fund — 10

NET CASH USED IN INVESTING ACTIVITIES ( 8,222 ) ( 4,982 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from loan — 4,601

Repayment of loan — ( 4,601 )

Payments of other long-term liabilities, net ( 2 ) —

Payments of debt issuance costs ( 237 ) —

Repayments of line of credit, net — ( 417 )

8 unchanged sentences

Interest paid $ 12 $ 1

Income taxes paid $ — $ 95

NON-CASH TRANSACTIONS

5 unchanged sentences

Natural Gas Services Group, Inc.

(the "Company", “NGS”, "Natural Gas Services Group", "we" or "our") (a Colorado corporation), is a leading provider of natural gas compression equipment and services to the energy industry.

(the "Company", “NGS”, "Natural Gas Services Group", "we" or "our") (a Colorado corporation), is a provider of natural gas compression equipment and services to the energy industry.

The Company manufactures, fabricates, rents, sells and maintains natural gas compressors and flare systems for oil and natural gas production and plant facilities.

4 unchanged sentences

All significant intercompany accounts and transactions for the periods presented have been eliminated in consolidation.

These financial statements include all adjustments, consisting of only normal recurring adjustments, which are necessary to make our financial position at September 30, 2021 and the results of our operations for the three and nine months ended September 30, 2021 and 2020 not misleading.

These financial statements include all adjustments, consisting of only normal recurring adjustments, which are necessary to make our financial position at March 31, 2022 and the results of our operations for the three months ended March 31, 2022 and 2021 not misleading.

As permitted by the rules and regulations of the Securities and Exchange Commission (SEC), the accompanying condensed consolidated financial statements do not include all disclosures normally required by generally accepted accounting principles in the United States of America (GAAP).

1 unchanged sentence

In our opinion, the condensed consolidated financial statements are a fair presentation of the financial position, results of operations, changes in stockholders' equity and cash flows for the periods presented.

The results of operations for the three and nine months ended September 30, 2021 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2021.

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

Revenue Recognition Policy

33 unchanged sentences

All control is maintained by the customer and there are no exceptions to the customer’s commitment to accept and pay for the manufactured equipment.

There was no revenue recognized for bill and hold arrangements for the nine months ended September 30, 2021.

Revenue recognized related to bill and hold arrangements for the nine months ended September 30, 2020 was approximately $ 852,000 .

There was no revenue recognized for bill and hold arrangements for the three months ended March 31, 2022 and 2021.

Parts - Revenue is recognized after the customer obtains control of the parts.

11 unchanged sentences

Disaggregation of Revenue

The following table shows the Company's revenue disaggregated by product or service type for the three and nine months ended September 30, 2021 and 2020:

Three months ended September 30, Nine months ended September 30,

2021 2020 2021 2020

(in thousands) (in thousands)

The following table shows the Company's revenue disaggregated by product or service type for the three months ended March 31, 2022 and 2021:

Three months ended March 31,

(in thousands)

Compressors - sales $ 1,968 $ 1,891

6 unchanged sentences

Contract Balances

As of September 30, 2021 and December 31, 2020, we had the following receivables and deferred income from contracts with customers:

September 30, 2021 December 31, 2020

As of March 31, 2022 and December 31, 2021, we had the following receivables and deferred income from contracts with customers:

March 31, 2022 December 31, 2021

(in thousands)

6 unchanged sentences

Deferred income $ — $ 1,312

The Company recognized sales and rental revenues of $ 1.1 million and $ 2,000 , respectively, for the nine months ended September 30, 2021 that was included in deferred income at the beginning of 2021.

For the year ended December 31, 2020, the Company recognized sales and rental revenues of $ 533,000 and $ 73,000 , respectively, that was included in deferred income at the beginning of 2020.

The decreases of accounts receivable and deferred income were primarily due to normal timing differences between our performance and the customers’ payments.

The Company recognized sales revenues of $ 1.3 million for the three months ended March 31, 2022 that was included in deferred income at the beginning of 2022.

For the year ended December 31, 2021, the Company recognized sales revenues of $ 1.1 million that was included in deferred income at the beginning of 2021.

The increase of accounts receivable and decrease of deferred income were primarily due to normal timing differences between our performance and the customers’ payments.

Remaining Performance Obligations

As of September 30, 2021, the Company did no t have revenue related to unsatisfied performance obligations.

As of March 31, 2022, the Company did no t have revenue related to unsatisfied performance obligations.

Contract Costs

9 unchanged sentences

A liability for unrecognized tax benefits is recorded for any tax benefits claimed in our tax returns that do not meet these recognition and measurement standards.

We have no liabilities for uncertain tax positions as of September 30, 2021.

We have no liabilities for uncertain tax positions as of March 31, 2022.

Our policy regarding income tax interest and penalties is to expense those items as interest expense and other expense, respectively.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was enacted in response to the economic impact caused by the COVID-19 pandemic.

The CARES Act, among other things, permits federal income tax net operating loss ("NOL") carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021.

In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid federal income taxes.

Please see Note 4, Federal Income Tax Receivable for a discussion about the impact on our condensed consolidated financial statements.

Recently Issued Accounting Pronouncements

4 unchanged sentences

We are currently evaluating the impact of ASU 2016-13 on our consolidated financial statements and note disclosures.

Our inventory, net of allowance for obsolescence of $ 37,000 at September 30, 2021 and $ 221,000 at December 31, 2020, consisted of the following amounts:

September 30, 2021 December 31, 2020

Our inventory, net of allowance for obsolescence of $ 37,000 at March 31, 2022 and $ 64,000 at December 31, 2021, consisted of the following amounts:

March 31, 2022 December 31, 2021

(in thousands)

8 unchanged sentences

A summary of our inventory allowance is as follows:

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

(in thousands)

4 unchanged sentences

Federal Income Tax Receivable

As discussed in Note 2, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid federal income taxes.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was enacted in response to the economic impact caused by the COVID-19 pandemic.

The CARES Act allowed NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid federal income taxes.

The Company generated significant NOLs during 2018 and 2019, and has filed amended returns to carryback these losses for five years.

Accordingly, during 2020, the Company recorded a federal income tax receivable of $ 15.0 million and an increase to its deferred income tax liability of $ 10.1 million on its condensed consolidated balance sheet.

During the third quarter of 2020, the Company received refunds totaling $ 3.9 million related to its 2018 NOLs, which reduced its federal income tax receivable to $ 11.5 million on its condensed consolidated balance sheet as of September 30, 2021.

Rental Equipment

Our rental equipment and associated accumulated depreciation as of September 30, 2021 and December 31, 2020, respectively, consisted of the following:

September 30, 2021 December 31, 2020

Our rental equipment and associated accumulated depreciation as of March 31, 2022 and December 31, 2021, respectively, consisted of the following:

March 31, 2022 December 31, 2021

(in thousands)

4 unchanged sentences

Rental equipment, net of accumulated depreciation $ 209,587 $ 206,985

We evaluated our rental equipment for potential impairment as of September 30, 2021, and determined that no such impairment existed as of that date.

We evaluated our rental equipment for potential impairment as of March 31, 2022, and determined that no such impairment existed as of that date.

Credit Facility

11 unchanged sentences

At any time before the maturity of the New Credit Agreement, we may draw, repay and re-borrow amounts available under the borrowing base up to the maximum aggregate availability discussed above.

valued at the lower of cost or market value at such time, subject to a cap of this component not to exceed $ 2.0 million, plus (d) the lesser of (i) 95 % of the net book value of the compressors that the Lender has determined are eligible for the extension of credit, valued at the lower of cost or market value with depreciation not to exceed 25 years, at such time and (ii) 80 % of the net liquidation value percentage of the net book value of the eligible compressors that the Lender has determined are eligible for the extension of credit, valued at the lower of cost or market value with depreciation not to exceed 25 years, at such time, plus (e) 80 % of the value at cost (excluding any costs for capitalized interest or other non-cash capitalized costs) of the eligible new compressor fleet, minus (f) any required availability reserves determined by the Lender in its sole discretion.

Generally, the borrowing base equals the sum of (a) 90 % of eligible accounts receivable owed to the Company by investment grade debtors, plus (b) 85 % of the eligible accounts receivable owing by non-investment grade debtors, plus (c) 50 % of the eligible inventory, valued at the lower of cost or market value at such time, subject to a cap of this component not to exceed $ 2.0 million, plus (d) the lesser of (i) 95 % of the net book value of the compressors that the Lender has determined are eligible for the extension of credit, valued at the lower of cost or market value with depreciation not to exceed 25 years, at such time and (ii) 80 % of the net liquidation value percentage of the net book value of the eligible compressors that the Lender has determined are eligible for the extension of credit, valued at the lower of cost or market value with depreciation not to exceed 25 years, at such time, plus (e) 80 % of the value at cost (excluding any costs for capitalized interest or other non-cash capitalized costs) of the eligible new compressor fleet, minus (f) any required availability reserves determined by the Lender in its sole discretion.

The Lender may adjust the borrowing base components if material deviations in the collateral are discovered in future audits of the collateral.

As of September 30, 2021, our allowable borrowing base was $ 20.0 million.

As of March 31, 2022, our allowable borrowing base was $ 20.0 million.

Interest and Fees.

16 unchanged sentences

or change the nature of our business.

In addition, we also have certain financial covenants that are applicable during certain trigger periods specified in the Credit Agreement and require us during such trigger periods to maintain a leverage ratio less than or equal to 3.00 to 1.00 as of the last day of each fiscal quarter and a fixed charge coverage ratio greater than or equal to 1.00 to 1.00 as of the last day of each fiscal quarter.

In addition, we also have certain financial covenants that are applicable during certain trigger periods specified in the

Credit Agreement and require us during such trigger periods to maintain a leverage ratio less than or equal to 3.00 to 1.00 as of the last day of each fiscal quarter and a fixed charge coverage ratio greater than or equal to 1.00 to 1.00 as of the last day of each fiscal quarter.

Events of Default and Acceleration.

9 unchanged sentences

Obligations outstanding under the Credit Agreement may be accelerated upon the occurrence of an event of default.

As of September 30, 2021, we were in compliance with all financial covenants in our New Credit Agreement.

At September 30, 2021, we had no amounts outstanding under the New Credit Agreement.

As of March 31, 2022, we were in compliance with all financial covenants in our New Credit Agreement.

At March 31, 2022, we had no amounts outstanding under the New Credit Agreement.

Stock-Based and Other Long-Term Incentive Compensation

Stock Options

A summary of all option activity as of December 31, 2020, and changes during the nine months ended September 30, 2021 is presented below.

A summary of all option activity as of December 31, 2021, and changes during the three months ended March 31, 2022 is presented below.

Stock Options

6 unchanged sentences

( 8,500 ) 14.89 — —

Outstanding, September 30, 2021 145,334 $ 25.21 3.11 $ —

Exercisable, September 30, 2021 145,334 $ 25.21 3.11 $ —

The following table summarizes information about our stock options outstanding at September 30, 2021:

Outstanding, March 31, 2022 189,834 $ 21.59 4.73 $ 70

Exercisable, March 31, 2022 136,834 $ 25.85 2.79 $ —

The following table summarizes information about our stock options outstanding at March 31, 2022:

Range of Exercise Prices

12 unchanged sentences

189,834 4.73 $ 21.59 136,834 $ 25.85

As of September 30, 2021 and December 31, 2020, there were no unvested stock options.

As of September 30, 2021, there was no unrecognized compensation cost related to unvested options.

For the nine months ended September 30, 2021 there was no compensation expense for stock options.

For the nine months ended September 30, 2020, total compensation expense for stock options was $ 18,000 .

The summary of the status of our unvested stock options as of December 31, 2021 and changes during the three months ended March 31, 2022 is presented below:

Unvested Stock Options:

Shares Weighted Average Grant Date Fair Value Per Share

Unvested at December 31, 2021

55,500 $ 5.15

Cancelled/Forfeited ( 2,500 ) 5.15

Unvested at March 31, 2022

53,000 $ 5.15

As of March 31, 2022, there was $ 218,643 unrecognized compensation cost related to unvested options.

For the three months ended March 31, 2022 there was $ 21,222 compensation expense for stock options.

For the three months ended March 31, 2021, there was no compensation expense for stock options.

Restricted Shares/Units

In accordance with the Company's employment agreement with Stephen Taylor, the Company's Chief Executive Officer, the Compensation Committee of the Company's Board of Directors reviewed his performance in determining the issuance of restricted common stock.

Based on this review, which included consideration of the Company's 2020 performance, Mr.

Taylor was awarded 109,212 restricted shares on March 18, 2021, which vest over three years , in equal annual installments, beginning March 18, 2022.

On March 18, 2021, the Compensation Committee awarded 20,000 restricted shares to our Vice President of Technical Services, James Hazlett.

The restricted shares to Mr.

Hazlett vest over three years , in equal annual installments, beginning March 18, 2022.

On June 17, 2021, the Compensation Committee awarded 5,000 restricted shares to our Vice President and Chief Financial Officer, Micah C.

The restricted shares granted to Mr.

Foster vest over 3 years, in equal annual installments, beginning on June 17, 2022.

On March 18, 2021, we also awarded and issued 5,612 shares of restricted common stock to each of our three independent members of our Board of Directors as partial payment for their services in 2021.

On April 1, 2021, we awarded and issued 5,291 shares of restricted common stock to a newly appointed member of our Board of Directors as partial payment for his services in 2021.

These awards of restricted stock vest one year from the date of grant.

Total compensation expense related to these and previously granted restricted stock awards was $ 1.3 million and $ 1.7 million for the nine months ended September 30, 2021 and 2020, respectively.

As of September 30, 2021, there was a total of $ 1.8 million of unrecognized compensation expense related to these shares/units which is expected to be recognized over the next 1.7 years.

A summary of all restricted stock/units outstanding as of December 31, 2020 and activity during the nine months ended September 30, 2021 is presented below:

On March 18, 2021, the Compensation Committee awarded 129,212 shares of restricted common stock to two executive officers that vest ratably over three years , beginning on March 18, 2022.

On June 17, 2021, the Compensation Committee awarded 5,000 shares of restricted stock to an executive officer that vests ratably over three years beginning on June 17, 2022.

In addition, on March 18, 2021, 5,612 shares of restricted common stock were awarded to each of our three independent Board members.

Lastly, on April 1, 2021, 5,291 shares of restricted common stock were awarded to a newly appointed Board member.

The restricted stock issued to our directors vests in one year from the date of grant.

There were no grants of restricted common stock as of the three months ended March 31, 2022.

Total compensation expense related to these and previously granted restricted stock awards was $ 0.4 million and $ 0.5 million for the three months ended March 31, 2022 and 2021, respectively.

As of March 31, 2022, there was a total of $ 1.0 million of unrecognized compensation expense related to these shares/units which is expected to be recognized over the next 1.8 years.

A summary of all restricted stock/units outstanding as of December 31, 2021 and activity during the three months ended March 31, 2022 is presented below:

Shares Weighted Average

4 unchanged sentences

( 110,465 ) 12.75 1,267

( 134,788 ) 14.94 1,258

Canceled/Forfeited

( 3,333 ) 12.26 31

Outstanding, September 30, 2021 276,319 $ 9.63 2.03 $ 2,868

Outstanding, March 31, 2022 165,854 $ 7.62 1.56 $ 1,975

Other Long-Term Incentive Compensation

On April 28, 2020, based on its review of Mr.

Taylor's 2019 performance, the Compensation Committee issued a long-term incentive award of $ 1.1 million to Mr.

Taylor that vests in equal, annual tranches over 3 years beginning on the anniversary of the grant date.

At the time of vesting, each tranche was or will be payable in cash or common stock at the discretion of the Compensation Committee.

On March 18, 2021, based on its review of Mr.

Taylor's 2020 performance, the Compensation Committee issued a long-term incentive award of $ 973,080 to Mr.

Taylor that vests in equal, annual tranches over 3 years beginning on the anniversary of the grant date.

In addition, on April 28, 2020, we issued a $ 50,000 award to three of our independent members of our Board of Directors as partial payment for their services in 2020.

These awards vest one year from the date of grant and are payable in cash upon vesting.

On March 18, 2021, we issued a $ 50,000 award to three of our independent members of our Board of Directors as partial payment for their services in 2021.

On March 18, 2021, the Compensation Committee issued a long-term incentive award of $ 1.0 million to an executive officer that vests in equal, annual tranches over 3 years beginning on the anniversary of the grant date.

In addition, on March 18, 2021, we issued a $ 50,000 award to three of our independent members of our Board of Directors as partial payment for their services in 2021.

On April 1, 2021, we issued a $ 50,000 award to a newly appointed independent member of our Board of Directors as partial payment for his services in 2021.

These awards vest one year from the date of grant and are payable in cash upon vesting.

The Company accounts for these other long-term incentive awards to Mr.

Taylor and our independent Board members as liabilities under accrued liabilities on our condensed consolidated balance sheet.

There were no long-term incentive awards issued to executives of directors during the three months ended March 31, 2022.

The Company accounts for these other long-term incentive awards as liabilities under accrued liabilities on our condensed consolidated balance sheet.

The vesting of these awards awards is subject to acceleration upon certain events, such as (i) death or disability of the recipient, (ii) certain circumstances in connection with a change of control of the Company, (iii) for executive officers, termination without cause (as defined in the agreement), and (iv) for executive officers, resignation for good reason (as defined).

Total compensation expense related to these other long-term incentive awards was approximately $ 600,000 and $ 252,000 for the nine months ended September 30, 2021 and 2020, respectively.

As of September 30, 2021, there was a total of $ 1.4 million of unrecognized compensation expense related to these other long-term incentive awards which is expected to be recognized over the next 2.0 years.

Total compensation expense related to these other long-term incentive awards was approximately $ 219,575 and $ 166,000 for the three months ended March 31, 2022 and 2021, respectively.

As of March 31, 2022, there was a total of $ 1.0 million of unrecognized compensation expense related to these other long-term incentive awards which is expected to be recognized over the next 1.7 years.

(Loss) Earnings per Share

The following table reconciles the numerators and denominators of the basic and diluted (loss) earnings per share computation:

Three months ended Nine months ended

September 30, September 30,

2021 2020 2021 2020

The following table reconciles the numerators and denominators of the basic and diluted earnings (loss) per share computation:

Three months ended

(in thousands, except per share data)

Net (loss) income $ ( 1,257 ) $ ( 562 ) $ ( 3,569 ) $ 3,685

Denominator for (loss) earnings per basic common share:

Net income (loss) $ 337 $ ( 394 )

Denominator for earnings (loss) per basic common share:

Weighted average common shares outstanding 12,537 13,263

Denominator for (loss) earnings per diluted common share:

Denominator for earnings (loss) per diluted common share:

Weighted average common shares outstanding 12,537 13,263

1 unchanged sentence

Diluted weighted average shares 12,698 13,263

(Loss) earnings per common share:

Earnings (loss) per common share:

Basic $ 0.03 $ ( 0.03 )

Diluted $ 0.03 $ ( 0.03 )

For the three and nine months ended September 30, 2021, 276,319 restricted stock/units and 145,334 stock options were not included in the computation of diluted loss per share due to their antidilutive effect.

For the three months ended September 30, 2020, 262,781 restricted stock/units and 166,334 stock options were not included in the computation of diluted earnings per share due to their antidilutive effect.

For the nine months ended September 30, 2020, 10,774 restricted stock/units and 171,900 stock options were not included in the computation of diluted earnings per share due to their antidilutive effect.

For the three months ended March 31, 2022, 4,852 restricted stock/units and 189,834 stock options were not included in the computation of diluted loss per share due to their antidilutive effect.

For the three months ended March 31, 2021, 315,359 restricted stock/units and 145,334 stock options were not included in the computation of diluted earnings per share due to their antidilutive effect.

Commitments and Contingencies

2 unchanged sentences

We are not currently a party to any material legal proceedings, and we are not aware of any threatened material litigation.

Stock Repurchase Program

On August 12, 2019, the Company announced the Board of Directors had authorized the repurchase of up to $ 10.0 million of its outstanding shares of common stock in the open market, block trades or privately negotiated transactions.

The timing and extent of any repurchase is subject to the discretion of management and is dependent upon market pricing and conditions, business, legal, accounting and other considerations.

The repurchase program does not obligate the Company to purchase any shares and was set to expire on September 30, 2020, subject to earlier termination of the program by the Board of Directors.

On October 23, 2020, the Board of Directors authorized the extension of the repurchase program through September 30, 2021.

The repurchase program may be modified, suspended or terminated at any time without notice, in the Company’s discretion, based upon a number of factors, including market conditions, the cost of repurchasing shares, the availability of alternative investment opportunities, liquidity, the need for capital in the Company’s operations and other factors deemed appropriate.

The Company intends to finance the repurchases with existing liquidity and free cash flow.

For the nine months ended September 30, 2021, the Company repurchased 432,731 of its outstanding shares of common stock with a value of $ 4.4 million, at an average price of $ 10.24 .

As of September 30, 2021, the expiration date of the plan, the Company had repurchased 470,667 of its outstanding shares of common stock with a value of $ 4.9 million, at an average price of $ 10.46 .

On September 30, 2021, the Board of Directors authorized a new repurchase plan for up to $ 10.0 million of its outstanding shares of common stock in the open market, block trades or privately negotiated transactions.

The terms of the new plan remain unchanged from the terms of the plan that expired on September 30, 2021.

For further information, see Part II Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds.

Subsequent Events

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

What changed 10-Q

Item 1. Financial Statements