Note 3.

LOSS PER SHARE

The condensed consolidated financial statements include basic and diluted loss per share. Diluted per share information is calculated by considering the impact of potential common stock on the weighted average shares outstanding. Potential common stock consists of (a) incremental shares that would be available for issuance upon the assumed exercise of stock options “in the money” based on the average stock price for the respective period, (b) convertible preferred shares (see Note 8), accounted for using the “if converted” basis, which assumes their conversion to common stock at a ratio of 16.6:1, (c) convertible debt (see Note 4), accounted for using the “if converted” basis, which assumes its conversion to common stock at a conversion rate of $0.0697 per share, and (d) the Centrex earnout payment obligation (see Note 4) accounted for using the “if converted” basis, which assumes its conversion to common stock at a conversion rate based upon the relative value of the earnout payment obligation and the value of the convertible debt.

As of September 30, 2016 and September 25, 2015, all options had expired. At September 30, 2016 and September 25, 2015, 1,131,551 convertible preferred shares were outstanding, which are in total, convertible into 18,859,183 shares of the Company’s common stock. Convertible debt was issued on August 11, 2016. As of September 30, 2016, $26.3 million of convertible debt (including outstanding principal and interest as of that date) was outstanding, which is in total, convertible into 377,109,583 shares of the Company’s common stock. The Centrex earnout payment obligation, became convertible into the Company’s common stock as part of the Fourth Amendment agreement on August 11, 2016 (see Note 4). As of September 30, 2016, $2.0 million was owed, which is in total, convertible into 28,694,405 shares of the Company’s common stock.

Shares of common stock issuable upon conversion of convertible preferred shares were not included in the calculation of diluted loss per share for the three and nine months ended September 30, 2016 and for the three and nine months ended September 25, 2015 because of their anti-dilutive impact as a result of the Company’s net loss position. Shares of common stock issuable upon conversion of convertible debt and the Centrex earnout payment obligation were not included in the calculation of diluted loss per share for the three and nine months ended September 30, 2016 because of their anti-dilutive impact as a result of the Company’s net loss position.