EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2019

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 years ended December 31, 2019 and December 31, 2018:


	Year Ended December 31, 2019						Year Ended December 31, 2018
Net income (loss)			$	6,248,890			$	(5,471,462)
Less dividends expense:
Common stock	$	6,988,198			$	6,578,196
Preferred stock	491,764				3,528,588
Deemed dividend on preferred stock redemption	3,093,028				—
			10,572,990				10,106,784
Undistributed (deficit)			$	(4,324,100)			$	(15,578,246)


	Unvested Share-Based Payment Awards		Common Stock		Unvested Share-Based Payment Awards		Common Stock
Distributed earnings	$	0.30	$	0.30	$	0.28	$	0.28
Undistributed (deficit)	$	—	$	(0.19)	—		(0.66)
Total	$	0.30	$	0.11	$	0.28	$	(0.38)


	For the years ended December 31,
	2019	2018
Basic weighted average shares of common stock outstanding	23,685,223	23,607,891
Weighted average of non-vested restricted stock	2,589	5,745
Diluted weighted average shares of common stock outstanding	23,687,812	23,613,636

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 year ended December 31, 2018.