NOTE 13. LOSS PER SHARE (EPS)

Basic EPS is calculated under the two-class method under which all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities based on their respective rights to receive dividends. Our outstanding convertible preferred stock are considered participating securities as the holders may participate in undistributed earnings with holders of common shares and are not obligated to share in our net losses.

Diluted EPS is computed by dividing the net income attributable to our common shareholders by the weighted average number of common shares outstanding during the period increased by the number of additional common shares that would have been outstanding if the impact of assumed exercises and conversions is dilutive. The dilutive effects of outstanding options, warrants, nonvested shares and restricted stock units that vest solely on the basis of a service condition are calculated using the treasury stock method. The dilutive effects of the outstanding preferred stock are calculated using the if-converted method.

Below are reconciliations of the numerators and denominators in the EPS computations.

	Three Months Ended September 30						Nine Months Ended September 30
	2019			2018			2019			2018
NUMERATOR (in thousands):
Basic and diluted - loss from continuing operations	$	(3,326	)	$	(1,627	)	$	(9,996	)	$	(5,700	)

DENOMINATOR:
Basic EPS - weighted average number of common shares outstanding		33,057,010			24,092,172			31,947,087			20,538,309
Effect of dilutive securities outstanding		-			-			-			-
Diluted EPS - weighted average number of shares outstanding		33,057,010			24,092,172			31,947,087			20,538,309

Number of shares of common stock which could be purchased with weighted average outstanding securities not included in diluted EPS because effect would be antidilutive:
Stock options		969,566			790,950			1,034,218			843,910
Warrants		7,712,225			14,421,219			8,744,733			17,840,322
Convertible preferred stock		213,523			597,865			228,540			597,865
Restricted stock units		1,138,442			178,478			1,263,275			428,132

Weighted average number of nonvested shares of common stock not included in diluted EPS because effect would be antidilutive		475,567			1,079,079			848,699			1,198,913

The impacts of potentially dilutive securities outstanding at September 30, 2019 and 2018, were not included in the calculation of diluted EPS for the three and nine months ended September 30, 2019 and 2018, because to do so would be anti-dilutive. Those securities listed in the table above which were anti-dilutive for the three and nine months ended September 30, 2019 and 2018, which remain outstanding, could potentially dilute EPS in the future.