EARNINGS PER SHARE

Basic earnings per share includes no dilution and is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares outstanding for the periods presented. The calculation of basic earnings per share for the years ended December 31, 2017 and December 31, 2016, respectively, includes the weighted average of common shares outstanding. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity, such as convertible preferred stock, stock options, warrants or convertible securities. Due to their anti-dilutive effect, the calculation of diluted earnings per share for the years ended December 31, 2017 and December 31, 2016 excludes: 1) options to purchase 3,180,417 and 3,063,852 shares, respectively, of common stock, 2) warrants to purchase 7,353,056 and 4,252,135 shares, respectively, of common stock, 3) Series B Preferred Stock which is convertible into 3,427,597 and 3,229,409 shares, respectively, of common stock, 4) Series B1 Preferred Stock which is convertible into 13,151,989 and 12,282,638 shares, respectively, of common stock, 5) Series A Preferred Stock which is convertible into 453,567 and 492,716 shares, respectively, of common stock, and 6) 31,568 and 31,568 shares, respectively, of Series C Preferred Stock, which is convertible into 3,156,800 and 3,156,800 shares of common stock, respectively.

The following is a reconciliation of the numerator and denominator for basic and diluted earnings per share for the years ended December 31, 2017 and 2016:



	2017			2016
Basic Earnings per Share
Numerator:
Net income (loss) available to common shareholders	$	(11,824,602	)	$	(15,537,395	)
Denominator:
Weighted-average common shares outstanding	32,653,402			30,520,820
Basic earnings per share	$	(0.36	)	$	(0.51	)

Diluted Earnings per Share
Numerator:
Net income (loss) available to common shareholders	$	(11,824,602	)	$	(15,537,395	)
Denominator:
Weighted-average shares outstanding	32,653,402			30,520,820
Effect of dilutive securities
Stock options and warrants	—			—
Preferred stock	—			—
Diluted weighted-average shares outstanding	32,653,402			30,520,820
Diluted earnings (loss) per share	$	(0.36	)	$	(0.51	)