Note

– Net Income Per-Share

Basic and diluted income per share are based on the weighted average number of shares of common stock and potential common stock outstanding during the period. Potential common stock, for the purpose of determining diluted income per share, includes the effects of dilutive unvested restricted stock, options to purchase common stock and convertible securities. The effect of such potential common stock is computed using the treasury stock method or the if-converted method, as applicable.

The following table presents a reconciliation of the numerators and denominators of the basic and diluted income per share computations for income from continuing operations. In the table below, income represents the numerator and shares represent the denominator (in thousands except per share amounts):

	Years Ended December 31 ,
	201 8		201 7

Basic net income per share :
Numerator:
Net income	$	2,437	$	766
Denominator:
Weighted-average shares of common stock outstanding		15,532		15,507
Basic net income per share	$	0.16	$	0.05

Diluted net income per share :
Numerator:
Net income	$	2,437	$	766
Plus interest expense on convertible debt		-		-
	$	2,437	$	766
Denominator:
Weighted-average shares of common stock outstanding		15,532		15,507
Dilutive options and warrants outstanding		3,147		1,013
Effect of conversion of convertible notes		-		4
Number of shares used in diluted per-share computation		18,679		16,524

Diluted net income per share	$	0. 13	$	0.05

For the year ended

December 31, 2017

potentially dilutive shares of

324,000

were excluded from the calculation of dilutive shares because their effect would have been anti-dilutive in that period.