What changed in this filing

/stocks — the workspaceLOADING

Item 1. Legal Proceedings

2021-11-05 compared with 2021-08-12 · 30 added, 13 removed, 42 unchanged (51% of the section changed)

8 unchanged sentences

it purchases certain antenna-related components from SPS and a number of other suppliers.

The Company has not been formally served with the complaint and thus has not yet filed an answer.

The Company was served with the complaint and is in the process of preparing an answer.

The Company intends to investigate and pursue its rights relating to the claims and to defend the suit vigorously.

6 unchanged sentences

As of the date of this Quarterly Report on Form 10-Q, there have been the following material changes with respect to such risk factors.

Our transition to being an accelerated filer and compliance with Section 404 of the Sarbanes-Oxley Act of 2002 will be time consuming and costly, and our inability to maintain effective internal control over financial reporting in the future could result in investors losing confidence in the accuracy and completeness of our financial reports and negatively affect the market price of our common stock.

Our transition to being an accelerated filer and compliance with Section 404 of the Sarbanes-Oxley Act of 2002 will be time consuming and costly, and because we have identified material weaknesses in our internal control over

financial reporting, our inability to maintain effective internal controls could result in investors losing confidence in the accuracy and completeness of our financial reports or our inability to accurately or timely produce our financial reports, any of which could negatively affect the market price of our common stock, perhaps significantly.

As a public company, we are required to maintain internal control over financial reporting and to report any material weaknesses in such internal controls.

Because we will become an accelerated filer effective December 31, 2021, Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) requires our independent registered public

accounting firm to attest to the effectiveness of our internal control over financial reporting.

Our transition to becoming subject to additional requirements of Section 404 of the Sarbanes-Oxley Act will be time-consuming, and there is a risk of noncompliance.

Because we will become an accelerated filer effective December 31, 2021, Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) requires our independent registered public accounting firm to attest to the effectiveness of our internal control over financial reporting.

Our transition to becoming subject to additional requirements of Section 404 of the Sarbanes-Oxley Act has been and will continue to be time-consuming.

Further, the costs associated with the compliance with and implementation of procedures under these and future laws and related rules could have a material impact on our results of operations.

If we have a material weakness in our internal control over financial reporting, we may not detect errors on a timely basis and our financial statements may be materially misstated.

If we identify material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, if we are unable to assert that our internal controls over financial reporting is effective or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our common stock could be negatively affected.

In addition, we could become subject to investigations by any stock exchange on which our securities are listed, the SEC or other regulatory authorities, which could require additional financial and management resources, which could have an adverse impact on our business.

In connection with our evaluation and testing of controls during the third quarter of 2021, our management identified deficiencies in our general information technology controls which were not designed to restrict users’ access privileges to their appropriate authorities and responsibilities.

We also identified deficiencies principally relating to the review and authorization of certain transactions within portions of our purchasing and revenue processes.

Management determined these deficiencies resulted in material weaknesses in internal control over financial reporting.

We are in the process of enhancing our internal controls in the aforementioned areas to remediate the material weaknesses.

However, we can give no assurance that these measures will be sufficient to remediate the material weaknesses, that additional material weaknesses or significant deficiencies in our internal controls will not be identified in the future or that we will otherwise be able to establish and maintain an effective system of internal controls.

As a result of the material weaknesses in our internal control over financial reporting, we may not detect errors on a timely basis, our financial statements may be materially misstated, investors may lose confidence in the accuracy and completeness of our financial reports and we may be unable to timely produce our financial reports.

Any of the foregoing could negatively affect the market price of our common stock, perhaps significantly.

In addition, we could become subject to investigations by any stock exchange on which our securities are listed, the SEC or other regulatory authorities, or litigation or disputes with stockholders, which could require additional financial and management resources and result in more costly directors’ and officers’ insurance, which could have an adverse impact on our business .

The failure to effectively recruit, retain and develop qualified personnel and implement effective succession processes could adversely affect our success and could have a material adverse effect on our business, financial condition and results of operations.

3 unchanged sentences

The market for qualified personnel is highly competitive, particularly in the states in which our operations are concentrated, and we have experienced labor availability issues in several of our facilities.

This shortage of labor has resulted, and may continue to result, in increased compensation and recruiting expenses, which could have a material adverse effect on our profitability, particularly if we are unable to pass some or all of such expenses on to our customers.

We may not succeed in recruiting sufficient personnel to support our production needs or may fail to effectively replace current personnel who depart with qualified or effective successors.

1 unchanged sentence

Exhibit Description

Amended and Restated CPI Card Group Inc.

Omnibus Incentive Plan (as amended and restated effective May 27, 2021) (incorporated by reference to the Company’s Current Report on Form 8-K filed May 28, 2021).

Certificate of Amendment of the Third Amended and Restated Certificate of Incorporation of CPI Card Group Inc.

(incorporated by reference to the Company’s Registration Statement on Form S-3 (File No.

333-259511)).

Form of Executive Nonqualified Stock Option Agreement under the CPI Card Group Inc.

Omnibus Incentive Plan .

Form of Executive Restricted Stock Unit Agreement under the CPI Card Group Inc.

Omnibus Incentive Plan .

Form of Director Restricted Stock Unit Agreement under the CPI Card Group Inc.

Omnibus Incentive Plan .

Offer Letter, dated October 1, 2021 by and between CPI Card Group Inc.

and Amintore Schenkel.

Offer Letter, dated October 1, 2021 by and between CPI Card Group Inc.

and John Lowe.

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

11 unchanged sentences

CPI CARD GROUP INC.

August 12, 2021

/s/ John Lowe

November 5, 2021

/s/ Amintore Schenkel

Amintore Schenkel

Chief Financial Officer

1 unchanged sentence

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. Legal Proceedings