What changed in this filing

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Item 1. Financial Statements

2022-08-02 compared with 2022-05-03 · 162 added, 136 removed, 580 unchanged (34% of the section changed)

4 unchanged sentences

Dollars, except outstanding shares)

March 31, 2022 At

June 30, 2022 At

December 31, 2021

2 unchanged sentences

Cash and cash equivalents $ 21,922 $ 28,408

Accounts receivable, net of allowance for doubtful accounts of $ 8,484 and $ 7,031 at March 31, 2022 and December 31, 2021, respectively

Accounts receivable, net of allowance for doubtful accounts of $ 9,383 and $ 7,031 at June 30, 2022 and December 31, 2021, respectively

2 14,287 12,823

Inventory, net of inventory reserve of $ 0 and $ 1,418 at March 31, 2022 and December 31, 2021, respectively

Inventory, net of inventory reserve of $ 0 and $ 1,418 at June 30, 2022 and December 31, 2021, respectively

2 2,853 2,457

26 unchanged sentences

unlimited authorized;

39,293,778 and 39,640,388 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

38,333,089 and 39,640,388 issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

7 $ 14,348 $ 14,014

9 unchanged sentences

Dollars, except share and per share amounts)

Three Months Ended March 31,

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

Note 2022 2021 2022 2021

7 unchanged sentences

Depreciation 243 207 480 407

Other (income) expense ( 455 ) 55

Loss (gain) on disposal of property and equipment ( 110 ) 83 ( 124 ) 159

Other expense ( 223 ) ( 32 ) ( 664 ) ( 53 )

Income from operations $ 1,001 $ 2,664 $ 3,249 $ 3,996

3 unchanged sentences

Net income before taxes 1,388 2,812 3,895 4,273

Provision (benefit) for income taxes 9 745 ( 223 )

Provision for income taxes 9 421 1,246 1,166 1,023

Net income $ 967 $ 1,566 $ 2,729 $ 3,250

Other comprehensive income

Other comprehensive income (loss)

Change in unrealized gain/loss on derivative instruments, net of tax 59 ( 6 ) 222 100

Other comprehensive income $ 163 $ 106

Other comprehensive income (loss) $ 59 $ ( 6 ) $ 222 $ 100

Comprehensive income $ 1,026 $ 1,560 $ 2,951 $ 3,350

16 unchanged sentences

Exercise of options 16,586 65 — — — 65

Shares issued for vesting of restricted stock units 556,840 4,403 ( 4,403 ) — — —

Shares issued for vesting of restricted stock 556,840 4,403 ( 4,403 ) — — —

Shares redeemed to pay income tax ( 181,320 ) — — — ( 1,434 ) ( 1,434 )

2 unchanged sentences

Shareholders' equity, March 31, 2021 39,577,288 $ 13,649 $ 4,224 $ ( 345 ) $ 65,893 $ 83,421

Stock-based compensation - options — — 998 — — 998

Share-based compensation - restricted stock — — 238 — — 238

Exercise of options 11,011 47 — — — 47

Change in accumulated other comprehensive loss, net of tax — — — ( 6 ) — ( 6 )

Net income — — — — 1,566 1,566

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

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

3 unchanged sentences

Stock-based compensation - restricted stock — — 485 — — 485

Shares issued for vesting of restricted stock units 67,010 334 ( 334 ) — — —

Shares issued for vesting of restricted stock 67,010 334 ( 334 ) — — —

Shares redeemed to pay income tax ( 23,742 ) — — — ( 119 ) ( 119 )

3 unchanged sentences

Shareholders' equity, March 31, 2022 39,293,778 $ 14,348 $ 8,720 $ ( 115 ) $ 73,091 $ 96,044

Stock-based compensation - options — — 757 — — 757

Stock-based compensation - restricted stock — — 514 — — 514

Shares repurchased under the share repurchase program ( 960,689 ) — — — ( 5,114 ) ( 5,114 )

Change in accumulated other comprehensive loss, net of tax — — — 59 — 59

Net income — — — — 967 967

Shareholders' equity, June 30, 2022 38,333,089 $ 14,348 $ 9,991 $ ( 56 ) $ 68,944 $ 93,227

See accompanying notes to the condensed consolidated financial statements

2 unchanged sentences

(Expressed in thousands of U.S.

Three Months Ended March 31,

Six Months Ended June 30,

Note 2022 2021

3 unchanged sentences

Depreciation 7,136 5,325

Change in allowance for doubtful accounts 2 3,445 1,819

Provision for uncollectible accounts 2 6,300 3,402

Change in inventory reserve ( 1,418 ) —

2 unchanged sentences

Income from equity method investments ( 769 ) ( 451 )

(Gain) Loss on disposal of property and equipment ( 14 ) 76

Deferred income tax expense (benefit) 745 ( 222 )

Loss (gain) on disposal of property and equipment ( 124 ) 159

Deferred income tax expense 745 1,005

Net change in working capital

Increase in accounts receivable ( 7,764 ) ( 3,163 )

Decrease in inventory 1,372 94

Increase in prepaid expenses and other assets ( 68 ) ( 161 )

(Decrease) increase in trade payables ( 467 ) 438

Increase in inventory 1,022 ( 248 )

Increase (decrease) in prepaid expenses and other assets ( 634 ) 311

Increase (decrease) in trade payables ( 243 ) 362

Increase in deferred revenue 649 333

Increase (decrease) in accrued liabilities 58 ( 77 )

Decrease in accrued liabilities ( 87 ) ( 3,800 )

Change in income tax payable/receivable 1,362 ( 340 )

9 unchanged sentences

Principal payments on term note 5 ( 872 ) ( 833 )

Shares repurchased under the share repurchase program 7 ( 1,887 ) —

Shares redeemed to pay income tax 7 ( 119 ) ( 1,434 )

Shares repurchased under the share repurchase program 7 ( 7,001 ) —

Repayments of lease liabilities ( 13 ) ( 1,655 )

5 unchanged sentences

Cash paid during the period for interest $ 128 $ 198

Refunds received during the period for income taxes $ 1,217 $ —

Cash paid (received) during the period for income taxes, net of refunds $ ( 940 ) $ 358

Supplemental disclosures of non-cash transactions

6 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Nature of Business and Operations

6 unchanged sentences

Kaliste Saloom Road, Lafayette, Louisiana 70508.

The Company no longer qualifies as a “smaller reporting company” and is required to comply with the larger company disclosure obligations (subject to certain exemptions and relief from various reporting requirements that are applicable to emerging growth companies) beginning in this Quarterly Report on Form 10-Q.

The Company is an "emerging growth company," as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), and as such, has elected to comply with certain reduced U.S.

The Company is an "emerging growth company," as defined in the JOBS Act, and as such, has elected to comply with certain reduced U.S.

public company reporting requirements.

Based on the annual assessment performed on June 30, 2022, the Company meets the re-entry thresholds to qualify as a "smaller reporting company" under Rule 12b-2 of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), and, as such, has elected to comply with certain reduced U.S.

public company reporting requirements.

The Company’s common shares are traded in the U.S.

21 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Accounts receivable

4 unchanged sentences

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

For the three months ended March 31, 2022, 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 six months ended June 30, 2022, the Company's 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:

March 31, 2022 March 31, 2021

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

June 30, 2022 June 30, 2021

Balance, beginning of year $ 7,031 $ 9,013

Change in allowance for doubtful accounts 3,445 1,819

Amounts written off ( 1,992 ) ( 2,833 )

Provision for uncollectible accounts 6,300 3,402

Amounts charged off ( 3,948 ) ( 5,127 )

Balance, end of period $ 9,383 $ 7,288

Included in accounts receivable at March 31, 2022 are amounts due from Medicare and Medicaid, representing 38 % and 12 %, respectively, and 50 % combined, of total outstanding receivables.

Included in accounts receivable at June 30, 2022 are amounts due from Medicare and Medicaid representing 37 % and 12 %, respectively, and 49 % combined, of total outstanding receivables.

As of December 31, 2021, 44 % of total outstanding receivables were amounts 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 months ended March 31, 2022 and 2021 were as follows:

Three Months Ended March 31,

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, 2022 and 2021 were as follows:

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

2022 2021 2022 2021

Medicare revenues 46 % 54 % 47 % 57 %

4 unchanged sentences

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

Inventory is presented net of a reserve balance of $ 0 and $ 1,418,000 at March 31, 2022 and December 31, 2021, respectively, that relates to COVID-19 response supplies.

During three months ended March 31, 2022, these supplies were determined to be unavailable for sale due to expiration.

Accordingly, the previously established reserves were eliminated through disposal.

Inventory is presented net of a reserve balance of $ 0 and $ 1,418,000 at June 30, 2022 and December 31, 2021, respectively, that relates to COVID-19 response supplies.

During the six months ended June 30, 2022, these supplies were determined to be unavailable for sale due to expiration.

Accordingly, the previously established inventory reserves were eliminated through disposal.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Property and equipment

9 unchanged sentences

The following table details the Company’s equity investments:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Equity method investments $ 1,116 $ 959

4 unchanged sentences

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.

Distributions received from the investee reduce the Company’s carrying value of the investment.

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 March 31, 2022 that would affect the carrying value of equity method investments.

No events or changes have occurred as of June 30, 2022 that would affect the carrying value of equity method investments.

Other equity investments include an equity interest in VeruStat, Inc and an equity interest in DMEscripts, LLC.

2 unchanged sentences

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 March 31, 2022 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 June 30, 2022 on its investments in equity securities without a readily determinable fair value.

Comprehensive income

10 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Revenue recognition

Revenue from a customer consists of any combination of the sale and rental of DME and/or patient medical services.

Revenues are billed to and collections received from Medicare, Medicaid, third-party insurers, co-insurance and patient-pay.

Revenue is recognized net of contractual adjustments and bad debt based on contractual arrangements with third-party payors, an evaluation of expected collections resulting from the analysis of current and past due accounts, past collection experience in relation to amounts billed and other relevant information.

Revenue from a customer consists of the sale and rental of home medical equipment and medical services.

Patient revenues are billed to and collections received from Medicare, Medicaid, third-party insurers, co-insurance and patient-pay.

Patient revenue is recognized net of contractual adjustments and bad debt based on contractual arrangements with third-party payors, an evaluation of expected collections resulting from the analysis of current and past due accounts, past collection experience in relation to amounts billed and other relevant information.

Contractual adjustments result from the differences between the rates charged for services and reimbursement rates paid by government-sponsored healthcare programs and insurance companies for such services.

11 unchanged sentences

The Company would first consider the lease classification issue (sales-type lease or operating lease) and then appropriately recognize or defer rental revenue over the lease term .

Under the Company’s direct commercial staffing arrangements, the Company manages all or a part of a customer’s supplemental workforce needs utilizing its own network of healthcare professionals.

As a result, the Company is the principal in this arrangement for revenue recognition purposes.

The Company includes the contractual gross billings in revenues with a corresponding increase to cost of revenues for worksite employee payroll costs associated with these services.

Alternatively, when the Company acts as agent in the performance of workforce management, revenue is recorded based on contractually agreed upon fees based on the hourly labor of worksite employees.

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

Three Months Ended March 31,

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

2022 2021 2022 2021

Revenue from rentals

3 unchanged sentences

Equipment and supply sales

3,245 2,076 6,282 3,844

COVID-19 response sales and services

183 1,136 2,278 4,091

Service revenues

2,234 578 3,480 990

Total revenues $ 33,310 $ 27,399 $ 65,565 $ 55,815

Revenue Accounting under Topic 842

The Company leases DME such as non-invasive and invasive ventilators, positive airway pressure ("PAP") machines, percussion vests, oxygen concentrator units and other small respiratory equipment to customers for a fixed monthly amount on a month-to-month basis.

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

The Company accounts for these rentals as operating leases.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Revenue Accounting under Topic 842

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

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.

17 unchanged sentences

The payment terms and conditions of customer contracts vary by customer type and the products and services offered.

For staffing services, performance obligations in the staffing agreements are satisfied over time when the customer simultaneously receives and consumes the benefits provided as the Company performs the services.

Accordingly, revenue from staffing services is recognized as the services are rendered in both principal and agent arrangements.

The Company determines its estimates of contractual allowances and discounts based upon contractual agreements, its policies and historical experience.

6 unchanged sentences

Such adjustments are typically identified and recorded at the point of cash application or claim denial.

Returns and refunds are not accepted on equipment sales, sleep study services or contact and vaccine tracing services.

The Company does not offer warranties to customers in excess of the manufacturer’s warranty.

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 March 31, 2022.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Returns and refunds are not accepted on equipment sales, sleep study services or contact and vaccine tracing services.

The Company does not offer warranties to customers in excess of the manufacturer’s warranty.

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, 2022.

Stock-based compensation

18 unchanged sentences

There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business and may remain uncertain for several years after their occurrence.

The Company recognizes assets and liabilities for taxation when it is probable that we will receive refunds from or pay taxes to the relevant tax authority.

The Company recognizes assets and liabilities for taxation when it is probable that it will receive refunds from or pay taxes to the relevant tax authority.

Where the final determination of tax assets and liabilities is different from the amounts that were initially recorded, such differences will impact the current and deferred income taxes provision in the period in which such a determination is made.

3 unchanged sentences

The calculation of current and deferred income taxes requires management to make estimates and assumptions and to exercise a certain amount of judgment concerning the carrying value of assets and liabilities.

The current and deferred income tax assets and liabilities are also impacted by expectations about future operating results and the timing of reversal of temporary differences as well as possible audits of tax filings by regulatory agencies.

Changes or differences in these estimates or assumptions may result in changes to the current and deferred tax assets and liabilities on the Condensed Consolidated Balance Sheets and a charge to or recovery of income tax expense.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

Recently adopted accounting pronouncements

In December 2019, the FASB issued ASU No.

2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes.

The new guidance simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740.

The new guidance also improves consistent application of and simplifies GAAP for other areas of Topic 740 by clarifying and amending the existing guidance.

The Company adopted this standard on January 1, 2021, which did not have any impact on the Company’s condensed consolidated financial statements.

June 30, 2022 and 2021

filings by regulatory agencies.

Recently issued accounting pronouncements

30 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Property and Equipment

1 unchanged sentence

The following table details the Company’s fixed assets:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Medical equipment $ 86,055 $ 76,864

6 unchanged sentences

Property and equipment, net of accumulated depreciation and amortization $ 66,685 $ 62,846

Depreciation in the amount of $ 3,160,000 and $ 2,409,000 is included in cost of revenue for the three months ended March 31, 2022 and 2021, respectively.

Included in medical equipment above is equipment acquired under finance lease obligations whose cost and accumulated depreciation at March 31, 2022 total $ 39,000 and $ 6,000 , respectively.

Depreciation in the amount of $ 3,497,000 and $ 2,509,000 is included in cost of revenue for the three months ended June 30, 2022 and 2021, respectively, and in the amount of $ 6,656,000 and $ 4,918,000 for the six months ended June 30, 2022 and 2021, respectively.

Included in medical equipment above is equipment acquired under finance lease obligations whose cost and accumulated depreciation at June 30, 2022 total $ 39,000 and $ 8,000 , respectively.

At December 31, 2021, cost and accumulated depreciation on equipment acquired under finance lease obligations was $ 47,000 and $ 5,000 , respectively.

1 unchanged sentence

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

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Accrued trade payables $ 2,185 $ 2,011

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 March 31, 2022 or December 31, 2021.

There were no borrowings against this line of credit at June 30, 2022 or December 31, 2021.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Commercial Term Notes

14 unchanged sentences

The recorded balances associated with these term notes are as follows:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Notes payable $ 4,838 $ 5,786

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 March 31, 2022.

The Company was in compliance with all covenants under the Commercial Business Term Loan Agreement in effect at June 30, 2022.

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:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Lease liabilities $ 490 $ 732

1 unchanged sentence

Net long-term lease liabilities $ 207 $ 268

Included in lease liabilities at March 31, 2022 are finance lease liabilities for medical equipment in the amount of $ 39,000 due between 2022 and 2024.

Included in lease liabilities at June 30, 2022 are finance lease liabilities for medical equipment in the amount of $ 29,000 due between 2022 and 2024.

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 March 31, 2022, the weighted

At June 30, 2022, the weighted average

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

average lease term was approximately 2.15 years.

Operating rental expenses were $ 126,000 and $ 185,000 for the three months ended March 31, 2022 and 2021, respectively.

June 30, 2022 and 2021

lease term was approximately 2.16 years.

Operating rental expenses were $ 124,000 and $ 250,000 for the three and six months ended June 30, 2022, respectively, and $ 190,000 and $ 375,000 for the three and six months ended June 30, 2021, respectively.

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

11 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 March 31, 2022 and December 31, 2021:

At March 31, 2022

The following tables summarize the Company's assets and liabilities measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021:

At June 30, 2022

(In thousands) Level 1 Level 2 Level 3 Total

13 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Derivative instruments and hedging activities

2 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 March 31, 2022, the Company holds one interest rate swap contract which matures on May 30, 2026 and has a notional amount of $ 4.4 million.

As of June 30, 2022, the Company holds one interest rate swap contract which matures on May 30, 2026 and has a notional amount of $ 4.4 million.

This contract is designated as a cash flow hedge.

In the first three months of 2022, ineffective portions of the hedge were immaterial.

The fair value was $ 0.02 million (determined based on Level 2 inputs) and is included in other long-term assets as of March 31, 2022.

In the first six months of 2022, ineffective portions of the hedge were immaterial.

The fair value was $ 0.1 million (determined based on Level 2 inputs) and is included in other long-term assets as of June 30, 2022.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

2 unchanged sentences

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.

The Company's other equity investments are holdings in a privately-held company without a readily determinable market value.

The Company's other equity investments are holdings in privately-held companies without a readily determinable market value.

The Company remeasures equity securities without readily determinable fair value at fair value when an orderly transaction is identified for an identical or similar investment of the same issuer in accordance with Topic 820.

8 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 39,293,778 and 39,640,388 shares were issued and outstanding as of March 31, 2022 and December 31, 2021, respectively.

For the three months ended March 31, 2022, the Company repurchased and canceled 389,878 common shares at a cost of $ 1.9 million pursuant to the Share Repurchase Program authorized by the Board of Directors on March 7, 2022 (the "2022 Share Repurchase Program").

The Company also acquired and cancelled 23,742 common shares at a cost of $ 0.1 million to satisfy employee income tax withholding associated with RSUs vesting during the three months ended March 31, 2022.

The authorized stock consists of an unlimited number of common shares with no stated par value, of which 38,333,089 and 39,640,388 shares were issued and outstanding as of June 30, 2022 and December 31, 2021, respectively.

For the six months ended June 30, 2022, the Company repurchased and canceled 1,350,567 common shares at a cost of $ 7.0 million pursuant to the Share Repurchase Program authorized by the Board of Directors on March 7, 2022 (the "2022 Share Repurchase Program").

The Company also acquired and cancelled 23,742 common shares at a cost of $ 0.1 million to satisfy employee income tax withholding associated with RSUs vesting during the six months ended June 30, 2022.

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

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 March 31, 2022, the Company had outstanding options of 4,505,000 and RSUs of 580,000 associated with common shares under the Omnibus Plan.

As of June 30, 2022, the Company had outstanding options of 4,532,000 and RSUs of 596,000 associated with common shares under the Omnibus Plan.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

The following table summarizes stock-based compensation expense for the three months ended March 31, 2022 and 2021 (in thousands):

Three Months Ended March 31,

June 30, 2022 and 2021

The following table summarizes stock-based compensation expense for the three and six months ended June 30, 2022 and 2021 (in thousands):

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

2022 2021 2022 2021

Stock-based compensation - options $ 757 $ 998 $ 1,577 $ 2,076

1 unchanged sentence

Total $ 1,271 $ 1,236 $ 2,576 $ 2,543

At March 31, 2022, there was approximately $ 3,597,000 of total unrecognized pre-tax stock option expense under the Company's equity compensation plans, which is expected to be recognized over a weighted-average period of 2.17 years.

As of March 31, 2022, there was approximately $ 2,404,000 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 1.53 years.

The following table summarizes stock option activity for the three months ended March 31, 2022:

At June 30, 2022, there was approximately $ 2,965,000 of total unrecognized pre-tax stock option expense under the Company's equity compensation plans, which is expected to be recognized over a weighted-average period of 1.99 years.

As of June 30, 2022, there was approximately $ 1,973,000 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 1.24 years.

The following table summarizes stock option activity for the six months ended June 30, 2022:

Number of options

5 unchanged sentences

Expired / Forfeited ( 2 ) 5.21

Balance March 31, 2022 4,505 $ 5.22 7.6 years $ 3,269

Balance June 30, 2022 4,532 $ 5.22 7.3 years $ 4,139

(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 the Company's common stock on the last trading day of the period ($ 5.38 ).

The aggregate intrinsic value of options outstanding was $ 3,269,313 and options exercisable were $ 3,269,213 at March 31, 2022.

For the three months ended March 31, 2022, 0 shares of common stock were issued pursuant to the exercise of stock options.

At March 31, 2022, the Company had 2,856,000 exercisable stock options outstanding with a weighted average exercise price of $ 4.41 and a weighted average remaining contractual life of 6.7 years.

The aggregate intrinsic value of options outstanding was $ 4,138,673 and options exercisable were $ 4,023,548 at June 30, 2022.

For the six months ended June 30, 2022, 0 shares of common stock were issued pursuant to the exercise of stock options.

At June 30, 2022, the Company had 2,864,000 exercisable stock options outstanding with a weighted average exercise price of $ 4.42 and a weighted average remaining contractual life of 6.5 years.

At December 31, 2021, the Company had 1,905,744 exercisable stock options outstanding with a weighted average exercise price of $ 3.70 and a weighted average remaining contractual life of 6.6 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 three months ended March 31, 2022 were as follows:

The assumptions used to determine the grant date fair value of the stock options granted during the six months ended June 30, 2022 were as follows:

Exercise price $ 5.21 - $ 5.41

8 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

June 30, 2022 and 2021

Restricted stock units

4 unchanged sentences

The Company accounts for forfeitures on RSUs under ASU 2016-09 and recognizes forfeitures in the period in which they occur.

The following table summarizes RSU activity for the three months ended March 31, 2022:

The following table summarizes RSU activity for the six months ended June 30, 2022:

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

4 unchanged sentences

Expired / Forfeited ( 4 ) 6.48

Balance March 31, 2022 580 $ 5.60 1.53 years $ 2,946

Balance June 30, 2022 596 $ 5.58 1.24 years $ 3,206

(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 the Company's closing stock price on the last trading day of the period ($ 5.38 ).

During the three months ended March 31, 2022, the Company issued 441,169 RSUs with a vesting term of three years and a fair value of $ 5.21 per share.

During the three months ended June 30, 2022, the Company issued 19,963 RSUs with a vesting term of three years and a fair value of $ 0.1 million.

During the six months ended June 30, 2022, the Company issued 461,132 RSUs with a vesting term of three years and a fair value of $ 2.4 million.

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 three months ended March 31, 2022:

The following table summarizes phantom share unit activity for the six months ended June 30, 2022:

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

3 unchanged sentences

Expired / Forfeited ( 30 ) ( 164 )

Balance March 31, 2022

Balance June 30, 2022 516 $ 2,774

(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 $ 4.98 on March 31, 2022.

The market price of the Company's stock was $ 5.38 on June 30, 2022.

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, 2022 is $ 1,226,000 , with $ 841,000 of this amount included in current accrued liabilities and the remaining portion of $ 385,000 included in long-term accrued liabilities.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

The total liability associated with phantom share units at March 31, 2022 is $ 2,074,000 , with $ 1,343,000 of this amount included in current accrued liabilities and the remaining portion of $ 731,000 included in long-term accrued liabilities.

June 30, 2022 and 2021

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 associated with the phantom share units for the three months ended March 31, 2022 and 2021 (in thousands):

Three Months Ended March 31,

The following table summarizes expense (benefit) associated with the phantom share units for the three and six months ended June 30, 2022 and 2021 (in thousands):

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

2022 2021 2022 2021

Selling, general, and administrative $ 538 $ ( 106 ) $ 949 $ 2,359

The Company paid cash settlements of $ 13,000 and $ 0 during the three months ended March 31, 2022 and 2021, pertaining to vestings of cash-settled phantom share units.

The Company paid cash settlements of $ 1,389,000 and $ 6,282,000 during the six months ended June 30, 2022 and 2021, respectively, pertaining to vestings of cash-settled phantom share units.

Commitments and Contingencies

13 unchanged sentences

The Company filed its Answer to the Reconventional Demand on February 12, 2021 and the parties are currently engaged in discovery.

The Company continues to believe that it has valid legal and equitable grounds to recover our outstanding prepayment as a result of Vyaire’s failure to deliver the vast majority of the respiratory equipment referenced in the Purchase Order.

The Company continues to believe that it has valid legal and equitable grounds to recover its outstanding prepayment as a result of Vyaire’s failure to deliver the vast majority of the respiratory equipment referenced in the Purchase Order.

The Company has determined that a loss related to the Reconventional Demand is not probable, and thus has not accrued a liability related to this claim.

Although a loss may be reasonably possible, the Company does 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 March 31, 2022, outstanding funds in the amount of $ 0.9 million related to undelivered respiratory equipment are included within other long-term assets.

As of June 30, 2022, 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

From time to time the Company is involved in various external governmental investigations, audits and reviews.

Reviews, audits and investigations of this sort can lead to government actions, which can result in the assessment of recoupment of reimbursement, civil or criminal fines or penalties, or other sanctions, including restrictions or changes in the way the Company conducts business, loss of licensure or exclusion from participation in government healthcare programs.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

Governmental and Regulatory Matters

From time to time the Company is involved in various external governmental investigations, audits and reviews.

June 30, 2022 and 2021

In May of 2021, a final report and recommendation (“Report”) was issued by the OIG regarding an audit by OIG of claims relating to 100 of the Company’s non-invasive ventilation at home (“NIVH”) patients.

4 unchanged sentences

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

In November 2021, the Company filed Reconsideration Appeals and intends to continue to defend itself vigorously through the remaining appeals processes which include, in successive order, Reconsideration decision, Administrative Law Judge appeals, Medicare Appeals Council review, and ultimately through Federal Court, if necess ary.

In November 2021, the Company filed Reconsideration Appeals with CMS's designated Qualified Independent Contractor ("QIC").

Based on its review, the QIC determined that approximately 77 % of the claims it reviewed were medically necessary and properly payable under Medicare rules and regulations, overturning OIG’s and the MACs' initial recommendations and determinations.

As a result of the QIC's reconsideration findings, recalculated principal overpayment requests totaling $ 1.1 million have been issued by the MACs .

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

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 the Company understands them, and the nature of the requests, the Company has determined that a loss is not probable but may be reasonably possible.

Based on the current facts and circumstances as the Company understands them, and the nature of the requests, the Company has determined that a loss is not probable but may be reasonably possible.

Accordingly, no related accrual has been recorded.

The extrapolated value of the 39 associated claims within the 4-year reopening period limited by statute is approximately $ 9 million.

The Company estimates that a possible loss, if any, will not exceed this amount.

The Company estimates that a possible loss, if any, will not exceed the amount of the recalculated overpayment requests.

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 three months ended March 31, 2022, the Company recorded an income tax expense of $ 0.7 million, which includes a discrete tax expense of $ 0.1 million associated with stock-based compensation arrangements.

Excluding the impact of the discrete tax benefit, the effective rate for the three months ended March 31, 2022 is 28.9 %.

For the six months ended June 30, 2022, the Company recorded income tax expense of $ 1.2 million.

Excluding the impact of the discrete taxes, the effective rate for the six months ended June 30, 2022 is 29.4 %.

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.

At March 31, 2022 and 2021, 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's 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.

At June 30, 2022 and 2021, 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.

4 unchanged sentences

In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations.

Earnings Per Share

Income per common share is calculated using earnings for the year divided by the weighted average number of shares outstanding during the year .

Using the treasury stock method, diluted income per share amounts are calculated giving effect to the potential dilution that would occur if securities or other contracts to issue common shares were exercised or converted to common shares by assuming the proceeds received from the exercise of stock options and the vesting of RSUs are used to purchase common shares at the prevailing market rate.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2022 and 2021

Earnings Per Share

Income per common share is calculated using earnings for the year divided by the weighted average number of shares outstanding during the year .

June 30, 2022 and 2021

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

Three Months Ended March 31,

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

2022 2021 2022 2021

Numerator - basic and diluted:

12 unchanged sentences

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

March 31, 2022 and 2021

June 30, 2022 and 2021

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