Net Earnings (Loss) Per Share

8 Months Ended

Jan. 07, 2024

Note 11 – Net Earnings (Loss) Per Share

Basic net earnings (loss) per share is calculated using the two-class method required for companies with participating securities. The two-class method is an earnings allocation formula under which the Company treats participating securities as having rights to earnings that otherwise would have been available to common shareholders. The Company considers the Redeemable Convertible Preferred Stock to be participating securities as the holders are entitled to receive dividends on an as-if converted basis equal to common stock.

Basic net earnings (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common stock outstanding, including issued but unexercised pre-funded warrants outstanding, during the respective periods. As the contingently issuable warrants are contingent upon additional funding under the Oaktree Tranche 2 loan being received, they have not been included in the calculation of basic net earnings (loss) per share. Diluted net earnings (loss) per share is calculated using the more dilutive of either the treasury stock, and if-converted method, as applicable, or the two-class method assuming the participating security is not converted.

The Company did not declare any common stock dividends in the periods presented. The following tables provide the calculation of basic and diluted net earnings (loss) per share of common stock for the twelve and thirty-six weeks ended January 7, 2024 and January 1, 2023:


	Twelve Weeks Ended				Thirty-Six Weeks Ended
	January 7, 2024		January 1, 2023		January 7, 2024		January 1, 2023
Numerator:
Net income (loss)	12,248		(392)		1,919		1,253
Cumulative unpaid dividends on Series I redeemable convertible preferred stock	(350)		—		(878)		—
Change in redemption amount of redeemable convertible preferred stock	—		—		(1,423)		—
Net income (loss) attributable to common stockholders	11,898		(392)		(382)		1,253
Earnings allocated to participating securities	(6,419)		—		—		—
Net income (loss) available to common stockholders, basic	5,479		(392)		(382)		1,253
Earnings allocated to participating securities	6,419		—		—		—
Impact of assumed conversions	361		—		—		33
Net income (loss) available to common stockholders, diluted	12,259		(392)		(382)		1,286

Denominator:
Weighted average common shares outstanding, basic	15,784,141		11,408,369		13,324,330		11,404,578
Dilutive awards outstanding	21,276,865		—		—		20,288,299
Weighted average common shares outstanding, diluted	37,061,006		11,408,369		13,324,330		31,692,877

Earnings (loss) per share:
Basic	$	0.35	$	(0.03)	$	(0.03)	$	0.11
Diluted	$	0.33	(0.03)		(0.03)		$	0.04

There were no potential common shares excluded from the computation of diluted earnings per share for the twelve and thirty-six ended January 7, 2024.