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Net Loss Per Unit

12 Months Ended

Dec. 31, 2024

Net Loss Per Unit

Net Loss Per Unit

NOTE 3 — Net Loss Per Unit

The Company has issued Series A, Series B and Series C units, as discussed in Note 15 — Members’ Deficit. Series A units are entitled to a preferred rate of return and Series C units are equivalent to profits interests. Only Series B units have voting rights. All Series B and Series C units are used in the computation of net loss per unit.

The Company has issued a number of warrants, exercisable at $0.01 per unit at any time from the warrant agreement execution dates to the exercise period end dates. Depending on the warrant agreement, the exercise period varies from seventh to tenth anniversary of the warrant agreement execution date. There were 305,632,700 and 181,148,044 warrants outstanding as of December 31, 2024 and 2023, respectively. Given the nominal exercise price, penny warrants are considered to be outstanding in the context of basic earnings per share, and thus the units are included in the computation of basic and diluted earnings per unit as of December 31, 2024 and 2023, respectively. However, the puttable warrants associated with the Bay Point note in the amounts of 4,799,204 and 3,839,359 are anti-dilutive for the year ended December 31, 2024 and 2023, respectively. Therefore, the Bay Point warrants are excluded from the calculation of diluted net loss per unit for the year ended December 31, 2024 and 2023, respectively.

The Company had 9,906,827 weighted average series B units for the year ended December 31, 2024 and 2023, respectively. In addition, the Company also had 1,584,327 weighted average series C units for the year ended December 31, 2024, and 1,481,622 weighted average series C units for the year ended December 31, 2023. Together with the exercisable warrants outstanding, the Company had 312,324,651 weighted average common series B and C units for the year ended December 31, 2024, and 188,579,085 weighted average common series B and C units for the year ended December 31, 2023.

The dividend calculation in the numerator represents the dividend expenses accrued but not yet paid for the periods indicated to the various owners of Series A units. Series A Units entitle the holder to receive an eight percent (8%) per annum rate of return on the unrecovered capital contribution of such holder.

Series A units, some of which are redeemable and some of which are nonredeemable, are excluded in the net loss per unit calculation below as they are not participating units. Series C units are non-voting units. These units are included in the basic and diluted weighted Series B units and Series C units outstanding calculation below. Warrants are also included in the below calculation of basic and diluted weighted average Series B units and Series C units outstanding because they are fully exercisable at any time by the holders.

The following table sets forth the computation of the Company’s basic and diluted loss per unit:


		For the Year Ended December 31,
		2024			2023
Numerator:
Net loss		$	(23,065,795)		$	(35,532,791)
Dividend			(2,260,287)			(2,082,277)
Earnings available for common units		$	(25,326,082)		$	(37,615,068)
Denominator:
Weighted average common units outstanding (basic)			312,324,651			188,579,085
Dilutive effect of potential membership units			—			—
Weighted average common units outstanding (diluted)			312,324,651			188,579,085
Basic earnings per unit		$	(0.08)		$	(0.20)
Diluted earnings per unit		$	(0.08)		$	(0.20)