Earnings Per Share

6 Months Ended

Jun. 30, 2020

4. Earnings Per Share

Basic earnings per common stock are computed by dividing net loss attributable to common stockholders by the weighted average number of common stock outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock (such as stock options, unvested restricted stock, common stock warrants, and preferred stock) were exercised or converted into common stock or resulted in the issuance of common stock (net of any assumed repurchases) that then shared in the earnings of the Company, if any. This is computed by dividing net earnings by the combination of dilutive common stock equivalents, which is comprised of shares issuable under outstanding warrants, the conversion of preferred stock, and the Company’s share-based compensation plans, and the weighted average number of common stock outstanding during the reporting period. Since the Company is in a net loss position, all common stock equivalents would be considered to be anti-dilutive and are, therefore, not included in the determination of diluted earnings per share. Accordingly, basic and diluted loss per share are the same.

The potentially dilutive securities are summarized as follows:


	At June 30,
	2020	2019
Stock options outstanding (1)	16,273,120	21,258,304
Restricted stock outstanding (2)	4,455,484	2,504,392
Common stock warrants (3)	110,573,392	115,824,142
Preferred stock (4)	—	17,933,591
Convertible Senior Notes (5)	72,872,730	43,630,020
Number of dilutive potential shares of common stock	204,174,726	201,150,449

(1)During the three months ended June 30, 2020 and 2019, the Company granted 174,649 and 339,392 stock options, respectively. During the six months ended June 30, 2020 and 2019, the Company granted 174,649 and 364,392 stock options, respectively.

(2)During the three months ended June 30, 2020 and 2019, the Company granted 96,649 and 339,392 shares of restricted stock, respectively. During the six months ended June 30, 2020 and 2019, the Company granted 94,649 and 364,392 shares of restricted stock, respectively.

(3)In April 2017, the Company issued warrants to acquire up to 55,286,696 of the Company’s common stock as part of a transaction agreement with Amazon, subject to certain vesting events, as described in Note 12, Warrant Transaction Agreements. Of these warrants issued, none have been exercised as of June 30, 2020.

In July 2017, the Company issued warrants to acquire up to 55,286,696 of the Company’s common stock as part of a transaction agreement with Walmart, subject to certain vesting events, as described in Note 12, Warrant Transaction Agreements. Of these warrants issued, none have been exercised as of June 30, 2020.

(4)The preferred stock amount represents the dilutive potential on the shares of common stock as a result of the conversion of the Series C Redeemable Convertible Preferred Stock (Series C Preferred Stock) and Series E Redeemable Preferred Stock (Series E Preferred Stock), based on the conversion price of each preferred stock as of June 30, 2020, and 2019, respectively. Of the 10,431 shares of Series C Preferred Stock issued on May 16, 2013, all shares had been converted to common stock as of June 30, 2020. On November 1, 2018, the Company issued 35,000 shares of Series E Preferred Stock. As of December 31, 2019, 30,462 shares of the Series E Preferred Stock had been

converted to common stock and 4,038 shares were redeemed for cash. The remaining 500 shares of Series E Preferred Stock were converted to common stock in January 2020.

(5)In March 2018, the Company issued the 5.5% Convertible Senior Notes. In September 2019, the Company issued the $7.5% Convertible Senior Note. In May 2020, the Company issued the 3.5 % Convertible Senior Notes and repurchased $66.3 million of the 5.5% Convertible Senior Notes. See Note 9, Convertible Senior Notes.