NET INCOME (LOSS) PER COMMON SHARE

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 3. NET INCOME (LOSS) PER COMMON SHARE

Basic income (loss) per common share is calculated by dividing net income (loss) available to common shareholders for the period by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share is calculated by dividing net income (loss) available to common shareholders for the period by the weighted-average number of common shares outstanding during the period, adjusted to include, if dilutive, potential dilutive shares consisting of convertible preferred stock, convertible notes payable, stock options and warrants, calculated using the treasury stock and if-converted methods. For diluted earnings per share calculation purposes, the net income available to commons shareholders is adjusted to add back any preferred stock dividends and any interest on convertible debt reflected in the condensed consolidated statement of operations for the respective periods.

The table below presents the computation of basic and diluted earnings (loss) per share:

(Amounts in thousands except share and per share amounts)	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Numerator for basic earnings (loss) per share:
Net income (loss)	$	3,522		$	3,665		$	(4,336	)	$	2,188
Preferred dividends		(99	)		(98	)		(202	)		(197	)
Net income (loss) available to common shareholders	$	3,423		$	3,567		$	(4,538	)	$	1,991
Numerator for diluted earnings (loss) per share:
Net income (loss) available to common shareholders	$	3,423		$	3,567		$	(4,538	)	$	1,991
Preferred dividends		99			98			—			197
Interest expense on convertible debt		86			2			—			4
Net income (loss) for diluted earnings (loss) per share	$	3,608		$	3,667		$	(4,538	)	$	1,995
Denominator for basic earnings (loss) per share — weighted-average shares outstanding		25,791,667			22,999,903			25,555,906			22,490,894
Effect of dilutive securities		34,252,751			15,450,821			—			16,441,295
Denominator for diluted earnings (loss) per share — weighted-average shares outstanding		60,044,418			38,450,724			25,555,906			38,932,189
Basic income (loss) per share:
Net income (loss)	$	0.14		$	0.16		$	(0.17	)	$	0.10
Preferred dividends		(0.01	)		(0.00	)		(0.01	)		(0.01	)
Net income (loss) available to common shareholders	$	0.13		$	0.16		$	(0.18	)	$	0.09
Diluted income (loss) per share:
Net income (loss)	$	0.06		$	0.10		$	(0.18	)	$	0.05

The Company has excluded the following securities from the calculation of diluted loss per share, as their effect would have been antidilutive:

Dilutive securities	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
Restricted stock		—		—		—		—
Convertible notes payable		—		—		—		—
Convertible preferred stock		56,574		52,952		56,124		52,494
Stock options		128,930		857,721		131,252		411,442
Warrants		417,916		1,589,796		417,916		1,589,796
Total dilutive securities		603,420		2,500,469		605,292		2,053,732