WEIGHTED AVERAGE COMMON SHARES

9 Months Ended

Sep. 30, 2013

WEIGHTED AVERAGE COMMON SHARES [Abstract]

WEIGHTED AVERAGE COMMON SHARES

2. WEIGHTED AVERAGE COMMON SHARES

The weighted average number of common shares used to compute basic and diluted loss per share for the three and nine months ended September 30, 2013 and 2012 was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Basic shares outstanding		22,528,478		22,194,731		22,480,308		22,171,757
Dilutive effect of stock options		-		86,402		-		-
Diluted shares outstanding		22,528,478		22,281,133		22,480,308		22,171,757

For the three months ended September 30, 2013 options to acquire 282,678 shares were excluded from the above table because the Company reported a net loss for the quarter and therefore their impact on reported loss per share would have been antidilutive.  For the nine months ended September 30, 2013 and 2012, options to acquire 234,073 and 304,333 shares, respectively, were excluded from the above table because the Company reported a net loss for the nine month and therefore their impact on reported loss per share would have been antidilutive.  For the three and nine months ended September 30, 2013 and 2012, options to acquire 785,768 and 304,333 shares, respectively, were excluded from the above table because they have an exercise price that is greater than the average market price of the Company’s common stock and therefore their impact on reported loss per share would have been antidilutive.

In 2011 and 2013, the Company issued performance shares that vest when certain performance conditions are satisfied.  As of September 30, 2013, these performance conditions were not met.  As a result, the Company has determined these shares to be contingently issuable.  Accordingly, 441,552 shares of outstanding performance shares have been excluded from the computation of diluted earnings per share for the three and nine months ended September 30, 2013, and 100,602 shares have been excluded for the three and nine months ended September 30, 2012.  Refer to Note 7 for more information on performance shares.