What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-11-02 compared with 2021-08-03 · 126 added, 100 removed, 628 unchanged (26% of the section changed)

4 unchanged sentences

Dollars, except outstanding shares)

June 30, 2021 At

September 30, 2021 At

December 31, 2020

2 unchanged sentences

Cash and cash equivalents $ 26,867 $ 30,981

Accounts receivable, net of allowance for doubtful accounts of $ 7,288 and $ 9,013 at June 30, 2021 and December 31, 2020, respectively

Accounts receivable, net of allowance for doubtful accounts of $ 7,115 and $ 9,013 at September 30, 2021 and December 31, 2020, respectively

2 12,696 12,373

Inventory, net of inventory reserve of $ 1,284 and $ 1,353 at June 30, 2021 and December 31, 2020, respectively

Inventory, net of inventory reserve of $ 1,237 and $ 1,353 at September 30, 2021 and December 31, 2020, respectively

2 2,622 2,310

Income tax receivable 1,420 —

Prepaid expenses and other assets 3,761 1,511

25 unchanged sentences

unlimited authorized;

39,588,299 and 39,185,182 issued and outstanding as of June 30, 2021 and December 31, 2020, respectively

39,630,446 and 39,185,182 issued and outstanding as of September 30, 2021 and December 31, 2020, respectively

7 $ 13,957 $ 9,181

9 unchanged sentences

Dollars, except share and per share amounts)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

Note 2021 2020 2021 2020

10 unchanged sentences

Income from operations $ 2,919 $ 4,040 $ 6,915 $ 21,514

Non-operating expenses

Loss (gain) from equity method investments ( 231 ) ( 42 ) ( 451 ) ( 15 )

Non-operating income and expenses

Income from equity method investments ( 331 ) ( 21 ) ( 782 ) ( 36 )

Interest expense, net of interest income 5 75 116 249 409

33 unchanged sentences

Shareholders' equity, June 30, 2020 39,082,932 $ 8,414 $ 5,448 $ ( 502 ) $ 57,768 $ 71,128

Stock-based compensation - options — — 945 — — 945

Stock-based compensation - restricted stock — — 289 — — 289

Exercise of options 2,400 8 — — — 8

Shares issued for vesting of restricted stock units 59,850 663 ( 663 ) — — —

Change in accumulated other comprehensive loss, net of tax — — — 24 — 24

Net income — — — — 2,804 2,804

Shareholders' equity, September 30, 2020 39,145,182 $ 9,085 $ 6,019 $ ( 478 ) $ 60,572 $ 75,198

See accompanying notes to the condensed consolidated financial statements

VIEMED HEALTHCARE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(Expressed in thousands of U.S.

Dollars, except share and per share amounts)

Common Stock Additional paid-in capital Accumulated other comprehensive loss Total Shareholders'

15 unchanged sentences

Shareholders' equity, June 30, 2021 39,588,299 $ 13,696 $ 5,460 $ ( 351 ) $ 67,459 $ 86,264

Stock-based compensation - options — — 1,051 — — 1,051

Stock-based compensation - restricted stock — — 251 — — 251

Shares issued for vesting of restricted stock units 42,147 261 ( 261 ) — — —

Change in accumulated other comprehensive loss, net of tax — — — 21 — 21

Net income — — — — 1,789 1,789

Shareholders' equity, September 30, 2021 39,630,446 $ 13,957 $ 6,501 $ ( 330 ) $ 69,248 $ 89,376

See accompanying notes to the condensed consolidated financial statements

2 unchanged sentences

(Expressed in thousands of U.S.

Six Months Ended June 30,

Nine Months Ended September 30,

Note 2021 2020

4 unchanged sentences

Change in allowance for doubtful accounts 2 5,250 7,031

Change in inventory reserve ( 116 ) —

Share-based compensation 7 3,845 3,581

Distributions of earnings received from equity method investments 172 —

(Gain) on equity method investments ( 451 ) ( 15 )

Income from equity method investments ( 782 ) ( 36 )

Loss (gain) on disposal of property and equipment 304 ( 2,424 )

Deferred income taxes (benefit) 1,005 ( 7,825 )

Deferred income tax expense (benefit) 2,410 ( 7,593 )

Net change in working capital

1 unchanged sentence

Increase in inventory ( 196 ) ( 1,402 )

Increase (decrease) in prepaid expenses and other assets 311 ( 329 )

Increase in prepaid expenses and other assets ( 2,259 ) ( 1,771 )

Increase in trade payables 2,638 2,739

Increase (decrease) in deferred revenue 333 ( 36 )

Increase in deferred revenue 386 297

(Decrease) increase in accrued liabilities ( 3,711 ) 2,397

(Decrease) increase in income tax payable ( 340 ) 1,404

Change in income tax payable/receivable ( 1,760 ) 282

Net cash provided by operating activities $ 13,839 $ 29,319

11 unchanged sentences

Net cash used in financing activities $ ( 4,770 ) $ ( 7,231 )

Net increase in cash and cash equivalents 170 16,352

Net (decrease) increase in cash and cash equivalents ( 4,114 ) 19,041

Cash and cash equivalents at beginning of year 30,981 13,355

11 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

Nature of Business and Operations

35 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

The Company writes off receivables when the likelihood for collection is remote, and when the Company believes collection efforts have been fully exhausted and it does not intend to devote additional resources in attempting to collect.

The write-offs are charged against the allowance for doubtful accounts.

For the six months ended June 30, 2021, our evaluation takes into consideration such factors as historical bad debt experience, national and local economic trends and conditions, industry and regulatory conditions, other collection indicators and information about disaggregated receivables.

For the nine months ended September 30, 2021, our evaluation takes into consideration such factors as historical bad debt experience, national and local economic trends and conditions, industry and regulatory conditions, other collection indicators and information about disaggregated receivables.

The complexity of many third-party billing arrangements, patient qualification for medical necessity of equipment and the uncertainty of reimbursement amounts for certain services from certain payors may result in adjustments to amounts originally recorded.

The estimates and write-offs for the allowance for doubtful accounts for each reporting period were as follows:

June 30, 2021 June 30, 2020

September 30, 2021 September 30, 2020

Balance, beginning of year $ 9,013 $ 7,782

2 unchanged sentences

Balance, end of period $ 7,115 $ 8,788

Included in accounts receivable at June 30, 2021 are amounts due from Medicare and Medicaid which represent 39 % and 13 %, respectively, and 52 % combined, of total outstanding receivables.

Included in accounts receivable at September 30, 2021 are amounts due from Medicare and Medicaid which represent 36 % and 10 %, respectively, and 46 % combined, of total outstanding receivables.

As of December 31, 2020, 46 % of total outstanding receivables were due from Medicare and Medicaid.

Revenues from Medicare and Medicaid as percentages of the Company's traditional revenue streams, excluding COVID-19 response sales and services, for the three and six months ended June 30, 2021 and 2020 were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Revenues from Medicare and Medicaid as percentages of the Company's traditional revenue streams, excluding COVID-19 response sales and services, for the three and nine months ended September 30, 2021 and 2020 were as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

5 unchanged sentences

Obsolete and unserviceable inventories are valued at estimated net realizable value.

Inventory is presented net of a reserve balance of $ 1,284,000 and $ 1,353,000 at June 30, 2021 and December 31, 2020, respectively, that relates to COVID-19 response supplies.

Inventory is presented net of a reserve balance of $ 1,237,000 and $ 1,353,000 at September 30, 2021 and December 31, 2020, respectively, that relates to COVID-19 response supplies.

Property and equipment

10 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

Equity investments

1 unchanged sentence

The following table details the Company’s equity investments:

June 30, 2021 December 31, 2020

September 30, 2021 December 31, 2020

Equity method investments $ 744 $ 134

2 unchanged sentences

Investments accounted for under the equity method are investments in unconsolidated entities over whose operating and financial policies the Company has the ability to exercise significant influence but not control.

Equity method investments are initially measured at cost in the Condensed Consolidated Balance Sheets with any subsequent adjustments made to the carrying amount of the investment for the Company’s proportionate share of income or loss.

Equity method investments are initially measured at cost in the Condensed Consolidated Balance Sheets with a n y subsequent adjustments made to the carrying amount of the investment for the Company’s proportionate share of income or loss.

The Company has recognized its share of income or loss on the gain (loss) from equity method investments within non-operating expenses in the Condensed Consolidated Statements of Income.

Equity method investments are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of the investments may exceed the fair value.

No events or changes have occurred as of June 30, 2021 that would affect the carrying value of equity method investments.

No events or changes have occurred as of September 30, 2021 that would affect the carrying value of equity method investments.

Other equity investments are investments without a readily determinable fair value which do not qualify for the practical expedient in ASC 820.

1 unchanged sentence

ASU 2019-04 clarifies that if an entity identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it must measure its equity investment at fair value in accordance with ASC 820 as of the date that the observable transaction occurred.

The Company was not aware of any impairment or observable price change adjustments that needed to be made as of June 30, 2021 on its investments in equity securities without a readily determinable fair value.

The Company was not aware of any impairment or observable price change adjustments that needed to be made as of September 30, 2021 on its investments in equity securities without a readily determinable fair value.

Comprehensive income

15 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

The Company's contracts with customers often include multiple products and services, and the Company evaluates these arrangements to determine the unit of accounting for revenue recognition purposes based on whether the product or service is distinct from other products or services in the arrangement and should be accounted for as a separate performance obligation.

11 unchanged sentences

The revenues from each major source are summarized in the following table:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

13 unchanged sentences

The customer generally has the right to cancel the lease at any time during the rental period.

The Company considers these rentals to be operating leases.

The Company accounts for these rentals as operating leases.

Under FASB ASC Topic 842, the Company recognizes rental revenue on operating leases on a straight-line basis over the contractual lease term which varies based on the type of equipment rental.

9 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

Revenue Accounting under Topic 606

21 unchanged sentences

Any taxes due upon sale of the products or services are not recognized as revenue.

The Company does not have any partially or unfilled performance obligations related to contracts with customers and as such, the Company has no contract liabilities as of June 30, 2021.

The Company does not have any partially or unfilled performance obligations related to contracts with customers and as such, the Company has no contract liabilities as of September 30, 2021.

Stock-based compensation

12 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

For determining the fair value of the interest rate swap contract, the Company uses significant other observable market data or assumptions (Level 2 inputs) that market participants would use in pricing similar assets or liabilities, including assumptions about counterparty risk.

These fair value estimates reflect an income approach based on the terms of the interest rate swap contract and inputs corroborated by observable market data including interest rate curves.

The Company includes unrealized gains in other long-term assets, as a component of long-term assets, and unrealized losses in accrued liabilities, as a component of long-term liabilities on the Condensed Consolidated Balance Sheets.

The Company presents a positive ending period fair value of the interest rate swap contract in other long-term assets, as a component of long-term assets, and a negative ending period fair value of the interest rate swap contract in accrued liabilities, as a component of long-term liabilities on the Condensed Consolidated Balance Sheets.

The Company recognizes any differences between the variable interest rate payments and the fixed interest rate settlements from its swap counterparty as an adjustment to interest expense over the life of the swap.

31 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments – Credit Losses.

14 unchanged sentences

The following table details the Company’s fixed assets:

June 30, 2021 December 31, 2020

September 30, 2021 December 31, 2020

Medical equipment $ 72,795 $ 63,307

6 unchanged sentences

Property and equipment, net of accumulated depreciation and amortization $ 59,036 $ 55,056

Depreciation in the amount of $ 2,509,000 and $ 1,985,000 is included in cost of revenue for the three months ended June 30, 2021 and 2020, respectively, and in the amount of $ 4,918,000 and $ 3,910,000 for the six months ended June 30, 2021 and 2020, respectively.

Included in medical equipment above is equipment acquired under finance lease obligations whose cost and accumulated depreciation at June 30, 2021 total $ 4,365,000 and $ 851,000 , respectively.

Depreciation in the amount of $ 2,656,000 and $ 2,224,000 is included in cost of revenue for the three months ended September 30, 2021 and 2020, respectively, and in the amount of $ 7,574,000 and $ 6,133,000 for the nine months ended September 30, 2021 and 2020, respectively.

Included in medical equipment above is equipment acquired under finance lease obligations whose cost and accumulated depreciation at September 30, 2021 total $ 1,098,000 and $ 222,000 , respectively.

At December 31, 2020, cost and accumulated depreciation on equipment acquired under finance lease obligations was $ 6,900,000 and $ 885,000 , respectively.

3 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

Current Liabilities

The Company’s short-term accrued liabilities are included within current liabilities and consist of the following:

June 30, 2021 December 31, 2020

September 30, 2021 December 31, 2020

Accrued trade payables $ 2,265 $ 1,252

11 unchanged sentences

Any amounts advanced on this line will be subject to an interest rate equal to the WSJ prime rate plus a margin of 0.50 %, with a 3.50 % interest rate floor and will be secured by substantially all of the Company's assets.

There were no borrowings against this line of credit at June 30, 2021 or December 31, 2020.

There were no borrowings against this line of credit at September 30, 2021 or December 31, 2020.

Commercial Term Notes

17 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

The recorded balances associated with these term notes, which have terms greater than twelve months, are as follows:

June 30, 2021 December 31, 2020

September 30, 2021 December 31, 2020

Notes payable $ 6,253 $ 7,632

4 unchanged sentences

The Credit Agreement also contains certain customary events of default, including, among other things, failure to make payments when due thereunder and failure to observe or perform certain covenants.

The Company was in compliance with all covenants under the Commercial Business Term Loan Agreement in effect at June 30, 2021.

The Company was in compliance with all covenants under the Commercial Business Term Loan Agreement in effect at September 30, 2021.

The Company has recognized finance lease liabilities for medical equipment and operating leases for land and buildings that have terms greater than twelve months, as follows:

June 30, 2021 December 31, 2020

September 30, 2021 December 31, 2020

Lease liabilities $ 1,315 $ 3,503

3 unchanged sentences

The Company has various finance leases for equipment with an implied interest rate at fixed rates up to 9.61 %, secured by equipment, due between 2021 and 2024.

The Company's weighted average interest rate was 4.74 % and 2.75 % for all finance lease liabilities outstanding as of June 30, 2021 and 2020, respectively.

At June 30, 2021 and 2020, the weighted average lease term was approximately 0.30 years and 0.90 years, respectively.

Interest expense related to these finance lease obligations for the three and six months ended June 30, 2021 amounted to $ 11,000 and $ 31,000 , respectively.

Interest expense related to these finance lease obligations for the three and six months ended June 30, 2020 amount to $ 42,000 and $ 94,000 , respectively.

The Company's weighted average interest rate was 3.74 % and 3.17 % for all finance lease liabilities outstanding as of September 30, 2021 and 2020, respectively.

At September 30, 2021 and 2020, the weighted average lease term was approximately 1.05 years and 0.73 years, respectively.

Interest expense related to these finance lease obligations for the three and nine months ended September 30, 2021 amounted to $ 4,000 and $ 35,000 , respectively.

Interest expense related to these finance lease obligations for the three and nine months ended September 30, 2020 amount to $ 34,000 and $ 128,000 , respectively.

Operating lease liabilities

2 unchanged sentences

These lease liabilities are recorded at present value based on a discount rate of 5.50 %, which was based on the Company's incremental borrowing rate at the time of assessment.

At June 30, 2021, the weighted average lease term was approximately 3.42 years.

Operating rental expenses were $ 190,000 and $ 375,000 for the three and six months ended June 30, 2021, respectively, and $ 201,000 and $ 385,000 for the three and six months ended June 30, 2020, respectively.

At September 30, 2021, the weighted average lease term was approximately 3.39 years.

Operating rental expenses were $ 194,000 and $ 570,000 for the three and nine months ended September 30, 2021, respectively, and $ 191,000 and $ 575,000 for the three and nine months ended September 30, 2020, respectively.

The related assets for operating lease liabilities have been included with property and equipment on the Condensed Consolidated Balance Sheets.

2 unchanged sentences

Rental payments under these related party lease agreements are $ 20,000 per month, plus taxes, utilities and maintenance.

Total rental payments for the use of these properties were $ 59,000 and $ 113,000 for the three and six months ended June 30, 2021, respectively, and $ 61,000 and $ 121,000 for the three and six months ended June 30, 2020, respectively.

Total rental payments for the use of these properties were $ 81,000 and $ 194,000 for the three and nine months ended September 30, 2021, respectively, and $ 58,000 and $ 180,000 for the three and nine months ended September 30, 2020, respectively.

The expense for these related party rents has been included within selling, general and administrative expenses.

3 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

Fair Value Measurement

10 unchanged sentences

There were no transfers between fair value measurement levels during any presented period.

The following tables summarize the Company's assets and liabilities measured at fair value on a recurring basis as of June 30, 2021 and December 31, 2020:

At June 30, 2021

The following tables summarize the Company's assets and liabilities measured at fair value on a recurring basis as of September 30, 2021 and December 31, 2020:

At September 30, 2021

(In thousands) Level 1 Level 2 Level 3 Total

13 unchanged sentences

This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities.

As of June 30, 2021, the Company holds one interest rate swap contract which matures on May 30, 2026 and has a notional amount of $ 4.6 million.

As of September 30, 2021, the Company holds one interest rate swap contract which matures on May 30, 2026 and has a notional amount of $ 4.5 million.

This contract is designated as a cash flow hedge.

In the first six months of 2021, ineffective portions of the hedge were immaterial.

The fair value was $( 0.3 ) million (determined based on Level 2 inputs) and is included in accrued liabilities, as a component of long-term liabilities as of June 30, 2021.

In the first nine months of 2021, ineffective portions of the hedge were immaterial.

The fair value was $( 0.3 ) million (determined based on Level 2 inputs) and is included in accrued liabilities, as a component of long-term liabilities as of September 30, 2021.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

13 unchanged sentences

The Company has only one class of stock outstanding, common shares.

The authorized stock consists of an unlimited number of common shares with no stated par value, of which 39,588,299 and 39,185,182 shares were issued and outstanding as of June 30, 2021 and December 31, 2020, respectively.

For the six months ended June 30, 2021, the Company repurchased and canceled 181,320 common shares at a cost of $ 1.4 million due to tax withholding for RSUs vesting.

The authorized stock consists of an unlimited number of common shares with no stated par value, of which 39,630,446 and 39,185,182 shares were issued and outstanding as of September 30, 2021 and December 31, 2020, respectively.

For the nine months ended September 30, 2021, the Company repurchased and canceled 181,320 common shares at a cost of $ 1.4 million due to tax withholding for RSUs vesting.

The Company’s retained earnings were reduced by the amount paid for the shares repurchased for cancellation.

4 unchanged sentences

The maximum amount of the foregoing common shares that may be awarded under the Omnibus Plan as “incentive stock options” is 2,600,000 common shares.

As of June 30, 2021, the Company had outstanding options of 3,799,000 and RSUs of 180,000 associated with common shares under the Omnibus Plan.

The following table summarizes stock-based compensation for the three and six months ended June 30, 2021 and 2020 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

As of September 30, 2021, the Company had outstanding options of 3,772,000 and RSUs of 219,000 associated with common shares under the Omnibus Plan.

The following table summarizes stock-based compensation expense for the three and nine months ended September 30, 2021 and 2020 (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

2 unchanged sentences

Total $ 1,302 $ 1,234 $ 3,845 $ 3,581

At June 30, 2021, there was approximately $ 4,547,000 of total unrecognized pre-tax stock option expense under our equity compensation plans, which is expected to be recognized over a weighted-average period of 2.21 years.

As of June 30, 2021, there was approximately $ 584,000 of total unrecognized pre-tax compensation expense related to outstanding time-based restricted stock units that is expected to be recognized over a weighted-average period of 0.91 years.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

The following table summarizes stock option activity for the six months ended June 30, 2021:

September 30, 2021 and 2020

At September 30, 2021, there was approximately $ 3,495,000 of total unrecognized pre-tax stock option expense under our equity compensation plans, which is expected to be recognized over a weighted-average period of 2.00 years.

As of September 30, 2021, there was approximately $ 852,000 of total unrecognized pre-tax compensation expense related to outstanding time-based restricted stock units that is expected to be recognized over a weighted-average period of 0.90 years.

The following table summarizes stock option activity for the nine months ended September 30, 2021:

Number of options

5 unchanged sentences

Expired / Forfeited ( 86 ) 8.32

Balance June 30, 2021 3,799 $ 5.23 7.9 years $ 7,293

Balance September 30, 2021 3,772 $ 5.21 7.7 years $ 4,343

(1) For presentation purposes, stock options issued with a CAD exercise price have been translated to USD based on the prevailing exchange rate on the date of grant.

(2) The aggregate intrinsic value of options outstanding represents the difference between the exercise price of the option and the closing stock price of our common stock on the last trading day of the period.

The aggregate intrinsic value of options outstanding was $ 7,293,000 and options exercisable were $ 6,666,000 at June 30, 2021.

For the six months ended June 30, 2021, 27,597 shares of common stock were issued pursuant to the exercise of stock options.

At June 30, 2021, the Company had 1,867,000 exercisable stock options outstanding with a weighted average exercise price of $ 3.58 and a weighted average remaining contractual life of 7.0 years.

The aggregate intrinsic value of options outstanding was $ 4,343,000 and options exercisable were $ 3,798,000 at September 30, 2021.

For the nine months ended September 30, 2021, 27,597 shares of common stock were issued pursuant to the exercise of stock options.

At September 30, 2021, the Company had 1,882,000 exercisable stock options outstanding with a weighted average exercise price of $ 3.65 and a weighted average remaining contractual life of 6.8 years.

At December 31, 2020, the Company had 971,000 exercisable stock options outstanding with a weighted average exercise price of $ 3.09 and a weighted average remaining contractual life of 6.9 years.

1 unchanged sentence

Stock–based compensation cost for stock options are determined at the grant date using the Black-Scholes option pricing model.

The assumptions used to determine the grant date fair value of the stock options granted during the six months ended June 30, 2021 were as follows:

The assumptions used to determine the grant date fair value of the stock options granted during the nine months ended September 30, 2021 were as follows:

Exercise price $ 8.57 - $ 9.77

14 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

The following table summarizes RSU activity for the six months ended June 30, 2021:

September 30, 2021 and 2020

The following table summarizes RSU activity for the nine months ended September 30, 2021:

Number of RSUs (000's) Weighted average grant price (1)

4 unchanged sentences

Expired / Forfeited ( 10 ) 6.80

Balance June 30, 2021 180 $ 7.74 0.91 years $ 1,288

Balance September 30, 2021 219 $ 6.72 0.90 years $ 1,217

(1) All future equity grants will be awarded in USD, therefore, RSUs issued with a CAD grant price have been translated to USD based on the prevailing exchange rate on the date of grant for presentation purposes.

(2) The aggregate intrinsic value of time-based RSUs outstanding was based on our closing stock price on the last trading day of the period.

During the three months ended June 30, 2021, the Company issued no RSUs.

During the six months ended June 30, 2021, the Company issued 63,306 RSUs with a vesting term of three years and a fair value of $ 8.57 per share.

During the three months ended September 30, 2021, the Company issued 81,394 RSUs with a vesting term of one year and a fair value of $ 6.38 per share.

During the nine months ended September 30, 2021, the Company issued 144,700 RSUs with a vesting term of one to three years and a fair value of $ 7.34 per share.

Phantom share units

3 unchanged sentences

The cash-settled phantom share units are accounted for as liability awards and are re-measured at fair value each reporting period until they become vested with accrued liability and related expense being recognized over the requisite service period.

The following table summarizes phantom share unit activity for the six months ended June 30, 2021:

The following table summarizes phantom share unit activity for the nine months ended September 30, 2021:

Number of phantom share units (000's) Value of share equivalents (1)

3 unchanged sentences

Expired / Forfeited ( 109 ) ( 601 )

Balance June 30, 2021 668 $ 4,777

Balance September 30, 2021 614 $ 3,407

(1) The value of outstanding share equivalents at the beginning of the period is based on the market price of the Company’s stock at that time, the value of issued share equivalents is based on the market price of the Company’s stock at issuance, the value of vested share equivalents is based on the cash paid at the time of vesting, the values of expired/forfeited share equivalents and outstanding share equivalents at the end of the period and are based on the market price of the Company's stock at the end of the period.

The market price of the Company's stock was $ 7.15 on June 30, 2021.

The market price of the Company's stock was $ 5.55 on September 30, 2021.

The change in fair value of the phantom share units has been charged to the Condensed Consolidated Statements of Income and Comprehensive Income and recorded as a liability included in accrued liabilities and long-term accrued liabilities.

The total liability associated with phantom share units at June 30, 2021 is $ 1,421,000 , with $ 1,026,000 of this amount included in current accrued liabilities and the remaining portion of $ 395,000 included in long-term accrued liabilities.

The total liability associated with phantom share units at September 30, 2021 is $ 1,462,000 , with $ 1,002,000 of this amount included in current accrued liabilities and the remaining portion of $ 460,000 included in long-term accrued liabilities.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

The impact associated with the fair value re-measurement of phantom share units is recorded in selling, general and administrative expenses within the unaudited Condensed Consolidated Statements of Income and Comprehensive Income.

The following table summarizes expense (benefit) associated with the phantom share units for the three and six months ended June 30, 2021 and 2020 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

The following table summarizes expense associated with the phantom share units for the three and nine months ended September 30, 2021 and 2020 (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

Selling, general and administrative $ 41 $ 459 $ 2,400 $ 4,070

The Company paid cash settlements of $ 6,282,000 and $ 4,201,000 during the six months ended June 30, 2021 and 2020, respectively, pertaining to vestings of cash-settled phantom share units.

The Company paid cash settlements of $ 6,282,000 and $ 4,201,000 during the nine months ended September 30, 2021 and 2020, respectively, pertaining to vestings of cash-settled phantom share units.

Commitments and Contingencies

16 unchanged sentences

Although a loss may be reasonably possible, we do not have sufficient information to determine the amount or range of reasonably possible loss with respect to the Reconventional Demand given that the dispute is in the early stages of the legal process.

As of June 30, 2021, outstanding funds in the amount of $ 0.9 million related to undelivered respiratory equipment are included within other long-term assets.

As of September 30, 2021, outstanding funds in the amount of $ 0.9 million related to undelivered respiratory equipment are included within other long-term assets.

Governmental and Regulatory Matters

5 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

In May of 2021, a final report and recommendation (“Report”) was issued by the U.S.

2 unchanged sentences

The Company firmly believes that the Report ignores each patient’s diagnosis and supporting documentation of that diagnosis from treating and prescribing physicians and applies clinical guidelines that are contrary to CMS’s accepted standard of care.

In late June of 2021, the Company received initial request letters from DME Medicare Administrative Contractors referencing the Report and requesting repayment of purported overpayments.

The Company has responded to each initial request by submitting a rebuttal and by filing a redetermination appeal as prescribed by the initial request letters and by statute, and the Company intends to continue to defend itself vigorously through Redetermination appeals, Reconsideration appeals, Administrative Law Judge appeals, Medicare Appeals Council review, and ultimately through Federal Court, if necessary.

In late June of 2021, the Company received initial request letters from DME Medicare Administrative Contractors ("MACs") referencing the Report and requesting repayment of purported overpayments.

The Company responded to each initial request by submitting a rebuttal and by filing a redetermination appeal as prescribed by the initial request letters and by statute.

In September 2021, the MACs informed the Company of unfavorable decisions with respect to the redetermination appeals.

The Company intends to continue to defend itself vigorously through the remaining appeals processes which include, in successive order, Reconsideration appeals, Administrative Law Judge appeals, Medicare Appeals Council review, and ultimately through Federal Court, if necess ary.

The Reconsideration appeals are required to be submitted in writing to the designated Quality Independent Contractor ("QIC") within 180 days of receiving the redetermination appeals letter.

The QIC has 60 days to render a reconsideration decision.

The timing of additional appeals beyond reconsideration are subject to workload constraints of the reviewing body.

Based on initial discussions with CMS, a review of the current facts and circumstances as we understand them, and the nature of the requests, we have determined that a loss is not probable but may be reasonably possible.

Accordingly, no related accrual has been recorded.

The value of the population of associated claims within the 4-year reopening period prescribed by statute is less th an $ 9 million.

The value of the population of associated claims within the 4-year reopening period prescribed by statute, including any potential interest, is approximately $ 9 million.

Man agement estimates that a possible loss, if any, will not exceed this amount.

It is possible that the ultimate resolution of this matter, if unfavorable, could materially and adversely affect the Company’s consolidated financial position, consolidated results of operations, or consolidated cash flows.

For the six months ended June 30, 2021, the Company recorded income tax expense of $ 1.0 million, which includes a discrete tax benefit of $ 0.9 million for excess tax benefits associated with stock-based compensation arrangements.

Excluding the impact of the discrete tax benefit, the effective rate for the six months ended June 30, 2021 is 44.1 %.

The effective rate differs from the amount computed by applying the statutory federal and state income tax rates to ordinary income before the provision for income taxes due to permanent non-deductible differences, Our effective tax rate is based on forecasted annual results which may fluctuate significantly through the rest of the year, in particular due to the uncertainty in our annual forecasts resulting from the unpredictable impact of the COVID-19 pandemic on our operating results.

During the six months ended June 30, 2020, the Company released a valuation allowance associated with deferred tax assets, resulting in a 6.5 million benefit during that period.

At June 30, 2021 and 2020, the Company had no amounts recorded for uncertain tax positions and does not expect any material changes in uncertain tax benefits during the next 12 months.

For the nine months ended September 30, 2021, the Company recorded income tax expense of $ 2.4 million, which includes a discrete tax benefit of $ 0.8 million for excess tax benefits associated with stock-based compensation arrangements.

Excluding the impact of the discrete tax benefit, the effective rate for the nine months ended September 30, 2021 is 43.4 %.

Our effective tax rate is based on forecasted annual results which may fluctuate significantly through the rest of the year, in particular due to the uncertainty in our annual forecasts resulting from the unpredictable impact of the COVID-19 pandemic on our operating results.

During the nine months ended September 30, 2020, the Company released a valuation allowance associated with deferred tax assets, resulting in a $ 5.3 million benefit during that period.

At September 30, 2021 and 2020, the Company had no amounts recorded for uncertain tax positions and does not expect any material changes in uncertain tax benefits during the next 12 months.

The Company recognizes interest and penalties related to income tax matters in income tax expense.

11 unchanged sentences

Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

The following reflects the earnings and share data used in the basic and diluted earnings per share computations:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

9 unchanged sentences

Diluted weighted-average number of shares 40,659,353 41,155,668 40,716,747 40,377,608

Anti-dilutive shares excluded from the calculation consisted of dilutive employee stock options that were de minimis in all periods presented.

Anti-dilutive shares excluded from the calculation consisted of dilutive employee stock options and RSUs that were de minimis in all periods presented.

VIEMED HEALTHCARE, INC.

1 unchanged sentence

(Tabular amounts expressed in thousands of US Dollars, except per share amounts)

June 30, 2021 and 2020

September 30, 2021 and 2020

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