KORE Group Holdings, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

NET LOSS PER SHARE

NET LOSS PER SHARE

6 Months Ended

Jun. 30, 2022

NET LOSS PER SHARE The Company follows the two-class method when computing net loss per common share when shares are issued that meet the definition of participating securities. The two-class method requires income available to common shareholders for the period to be allocated between common and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The two-class method also requires losses for the period to be allocated between common and participating securities based on their respective rights if the participating security contractually participates in losses. As holders of participating securities do not have a contractual obligation to fund losses, undistributed net losses are not allocated to Series A, Series A-1, Series B and Series C preferred shares for purposes of the loss per share calculation. Earnings per share calculations for all periods prior to the Business Combination have been retrospectively restated to the equivalent number of shares reflecting the exchange ratio established in the Business Combination Agreement. Certain of pre-Combination Kore’s preferred shares had contractual rights that allowed them to receive a premium upon conversion of the preferred shares into common stock. For the three and six months ended June 30, 2021, the Company did not incur premiums on conversion of pre-Combination Kore’s preferred shares

into common shares. Refer to “Note 10—Temporary Equity and Stockholder’s Equity” to the condensed consolidated financial statements for further detail regarding the contractual rights of the Company’s preferred shares.

Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations for the periods ended:


	For the three months ended				For the six months ended
	June 30,				June 30,
(in 000’ USD, except share and per share amounts)	2022		2021		2022		2021
Numerator:
Net loss attributable to the Company	$	(11,141)	$	(6,885)	$	(22,048)	$	(7,966)
Less cumulative earnings to preferred shareholder	—		(7,532)		—		(14,925)
Net loss attributable to common stockholders	(11,141)		(14,417)		(22,048)		(22,891)
Denominator:
Weighted average common shares and warrants outstanding*
Basic (in number)	76,239,989		31,647,131		75,146,201		31,647,131
Diluted (in number)	76,239,989		31,647,131		75,146,201		31,647,131
Net loss per unit attributable to common stockholder
Basic	$	(0.15)	$	(0.46)	$	(0.29)	$	(0.72)
Diluted	$	(0.15)	$	(0.46)	$	(0.29)	$	(0.72)

*The KORE warrants have been treated as outstanding common shares in the weighted average common shares and warrants outstanding for the three months and six months ended June 30, 2021.

The following securities were not included in the computation of diluted shares outstanding because the effect would be anti-dilutive:


	For the three months ended		For the six months ended
(Number of shares)	June 30,		June 30,
	2022	2021	2022	2021
Series C Convertible Preferred Stock	—	2,520,368	—	2,520,368
Stock Options	—	432,500	—	432,500
Common stock issued under the Backstop Agreement	9,600,031	—	9,600,031	—
Restricted stock grants with only service conditions	3,441,651	—	3,275,885	—