EARNINGS PER SHARE

In accordance with ASC 260, outstanding instruments that contain rights to non-forfeitable dividends are considered participating securities. The Company is required to apply the two-class method or the treasury stock method of computing basic and diluted earnings per share when there are participating securities outstanding. The Company has determined that outstanding unvested restricted shares issued under the Manager Equity Plan are participating securities, and they are therefore included in the computation of basic and diluted earnings per share. The following tables provide additional disclosure regarding the computation for the three months ended March 31, 2019 and March 31, 2018:



	Three Months Ended March 31, 2019					Three Months Ended March 31, 2018
Net income (loss)			$	1,474,767				$	11,315,000

Less dividends:
Common stock	$	1,658,136				$	2,314,686
Preferred stock	480,472					880,509
Deemed dividend on preferred stock related to redemption	3,093,028					—
			5,231,636					3,195,195
Undistributed earnings (deficit)			$	(3,756,869	)			$	8,119,805



	Unvested Share-Based Payment Awards			Common Stock			Unvested Share-Based Payment Awards		Common Stock
Distributed earnings	$	0.07		$	0.07		$	0.10	$	0.10
Undistributed earnings (deficit)	(0.16		)	(0.16		)	0.35		0.35
Total	$	(0.09	)	$	(0.09	)	$	0.45	$	0.45

Pursuant to an agreement dated January 18, 2018, XL investments agreed to terminate all of its previously held warrants to purchase 3,753,492 shares of common stock held by it, and therefore no adjustment was needed for the calculation of diluted earnings per share for the three months ended March 31, 2019. No adjustment was required for the calculation of diluted earnings per share for the three months March 31, 2018, for the warrants described in Note 17 because the warrants’ exercise price was greater than the average market price of the common shares for the period, and thereby anti-dilutive. For the three months ended March 31, 2019 the weighted average number of shares of common stock outstanding to calculate the basic and diluted earnings per share was 23,687,664 and for the three months ended March 31, 2018, the weighted average number of shares of common stock outstanding to calculate the basic and diluted earnings per share was 23,392,387.