BASIC AND DILUTED EARNINGS PER SHARE

9 Months Ended

Sep. 29, 2012

BASIC AND DILUTED EARNINGS PER SHARE

BASIC AND DILUTED EARNINGS PER SHARE

3.BASIC AND DILUTED EARNINGS PER SHARE

Basic earnings (loss) per share has been computed based upon the weighted average of common shares outstanding. Diluted earnings (loss) per share also includes the dilutive effect of potential common shares (dilutive stock options and unvested restricted stock awards) outstanding during the period. Income (loss) per common share has been computed as follows:

	39-Weeks Ended					13-Weeks Ended
	September 29,			October 1,		September 29,			October 1,
	2012			2011		2012			2011
Net income (loss)	$	(6,553,000	)	$	205,000	$	(6,376,000	)	$	(1,822,000	)
Basic weighted number of average shares outstanding	12,882,000			12,831,000		12,892,000			12,849,000
Incremental shares from assumed issuances of stock options and restricted stock awards	—			28,000		—			—
Diluted weighted average number of shares outstanding	12,882,000			12,859,000		12,892,000			12,849,000
Net income (loss) per share - Basic	$	(0.51	)	$	0.02	$	(0.49	)	$	(0.14	)
- Diluted	$	(0.51	)	$	0.02	$	(0.49	)	$	(0.14	)

Options and unvested restricted common shares of 1,176,675 were excluded from the computation of diluted loss per share for the 39- and 13-week period ended September 29, 2012 because of the net loss incurred by the Company.  Options to purchase 736,675 common shares were excluded from the computation of diluted earnings per share for the 39-week period ended October 1, 2011, due to the anti-dilutive effect caused by the exercise price exceeding the average market price. Unvested restricted common shares of 149,997 were excluded from the computation of diluted earnings per share for the 39-week period ended October 1, 2011, due to contingent restricted shares not meeting their performance goals.

Options and unvested restricted common shares of 1,008,008 were excluded from the computation of diluted loss per share for the 13-week period ended October 1, 2011 because of the net loss incurred by the Company.