Note J - Loss Per Share

We present loss per share in accordance with ASC 260, Earnings Per Share ("ASC 260").Basic earnings (loss) per share is computed by dividing earnings (loss) attributable to AV Homes stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of AV Homes. In accordance with ASC 260, the computation of diluted earnings (loss) per share for the three months ended March 31, 2013 and 2012 did not assume the effect of restricted stock units, employee stock options, the 7.50% Notes, the 7.50% Exchange Notes, or the 4.50% Notes because the effects were antidilutive.

The weighted average number of shares outstanding in calculating basic loss per share includes the cancellation of 2,364 shares of common stock and the issuance of 6.734 shares of common stock for the three months ended March 31, 2013, and cancellation of 5,072 shares of common stock for the three months ended March 31, 2012. In accordance with ASC 260, non-vested restricted shares are not included in basic earnings per share until the vesting requirements are met.

The following table represents the net loss and weighted average shares outstanding for the calculation of basic and diluted loss per share for the three months ended March 31, 2013 and 2012:

	Three Months
	2013			2012
Numerator:
Basic and diluted loss per share – net loss	$	(4,759	)	$	(8,451	)

Denominator:
Basic and diluted weighted average shares outstanding		12,654,466			12,521,483