Three Months Ended

Nine Months Ended

September 30,

2021

2020

2021

2020

(In thousands, except share and per share information)

Numerator:

Net income (loss) attributable to Acacia Research Corporation

$

89,604

$

38,348

$

(55,507

)

$

33,205

Dividend on Series A redeemable convertible preferred stock

(262

)

(467

)

(785

)

(1,118

)

Accretion of Series A redeemable convertible preferred stock

(991

)

(733

)

(2,762

)

(2,045

)

Undistributed earnings allocated to participating securities

(15,367

)

(6,619

)

–

(5,204

)

Net income (loss) attributable to common stockholders - Basic

72,984

30,529

(59,054

)

24,838

Add: Dividend on Series A redeemable convertible preferred stock

–

467

–

Add: Accretion of Series A redeemable convertible preferred stock

–

733

–

Less: Change in fair value of Series A redeemable convertible preferred stock embedded derivative

–

(3,831

)

–

Less: Change in fair value of Series A warrants

63

(1,348

)

–

(1,348

)

Less: Change in fair value of dilutive Series B warrants

(902

)

(5,557

)

–

(5,557

)

Add: Interest expense associated with Starboard Notes, net of tax

1,536

1,889

–

1,889

Add: Undistributed earnings allocated to participating securities

15,367

6,619

–

5,204

Reallocation of undistributed earnings to participating securities

(8,877

)

(296

)

–

(3,645

)

Net income (loss) attributable to common stockholders - Diluted

$

80,171

$

29,205

$

(59,054

)

$

21,381

Denominator:

Weighted-average shares used in computing net income (loss) per share attributable to common stockholders - Basic

48,949,504

48,467,885

48,759,873

48,949,706

Potentially dilutive common shares:

Series A Preferred Stock

–

9,589,041

–

Restricted stock

798,356

728,936

–

598,328

Stock options

35,815

21,624

–

Series A Warrants

2,019,724

310,367

–

103,456

Series B Warrants

41,278,103

31,506,849

–

10,502,283

Weighted-average shares used in computing net income (loss) per share attributable to common stockholders - Diluted

93,081,502

90,624,702

48,759,873

60,153,773

Basic net income (loss) per common share

$

1.49

$

0.63

$

(1.21

)

$

0.51

Diluted net income (loss) per common share

$

0.86

$

0.32

$

(1.21

)

$

0.36

Anti-dilutive potential common shares excluded from the computation of diluted net income (loss) per common share:

Equity-based incentive awards

398,168

191,312

2,230,624

310,083

Series A warrants

–

5,000,000

–

Series B warrants

–

68,493,151

100,000,000

68,493,151

Total

398,168

68,684,463

107,230,624

68,803,234