Equity and Earnings per Share ("EPS")

12 Months Ended

Dec. 31, 2021

Equity and Earnings per Share (“EPS”)

In the calculations of basic and diluted earnings per common share for the year ended December 31, 2021, the Company included participating securities, which are certain equity awards that have non-forfeitable dividend participation rights, as it was determined that the two-class method was more dilutive than the alternative treasury stock method for these shares. Dividends and undistributed earnings allocated to participating securities under the basic and diluted earnings per share calculations require specific shares to be included that may differ in certain circumstances. For the year ended December 31, 2021, no outstanding equity awards were antidilutive.

The following table sets forth the calculation of basic and diluted earnings per share for the year ended December 31, 2021:


	December 31, 2021
	(in thousands, except share data)
Basic Earnings per Common Share:
Net income allocable to common stockholders	$	21,098
Basic weighted average common shares outstanding	20,601,964
Basic earnings per common share	$	1.02
Diluted Earnings per Common Share:
Net income allocable to common stockholders	$	21,098
Net effect of dilutive equity awards	250,590
Diluted weighted average common shares outstanding	20,852,554
Diluted earnings per common share	$	1.01

Basic and Diluted EPS for the year ended December 31, 2020

For the year ended December 31, 2020, basic and diluted earnings per share were equivalent as there were no potentially dilutive securities outstanding. For the year ended December 31, 2020, 1,000 shares of common stock were outstanding (both outstanding and weighted average outstanding), all of which were held by Angel Oak Mortgage Fund, LP, the Company’s sole common stockholder prior to the IPO. These shares have been retroactively restated accordingly for the calculations of earnings per share for the year ended December 31, 2020 as described below.

In conjunction with its IPO, the Company’s sole common shareholder declared a stock split and subsequent stock dividend that resulted in the issuance of 15,723,050 shares of common stock being owned by that sole common stockholder, who then distributed all of its stock in the Company (representing 15,724,050 shares) to its investors. As a result of the stock split and stock dividend, 15,724,050 shares of common stock were outstanding as of June 21, 2021 (both outstanding and weighted average outstanding) immediately prior to the completion of the IPO, and the related share data and earnings per share calculations include the share amounts that have been retroactively restated accordingly for the calculations of earnings per share for the year ended December 31, 2020.