Earnings Per Share

12 Months Ended

Dec. 31, 2020

Note 18 – Earnings Per Share

The weighted average common shares outstanding are as follows:



	Year Ended December 31,
	2020	2019

Weighted average common shares outstanding	12,881,403	12,352,142
Issuance of warrants	551,025	-
Weighted-average shares outstanding - basic	13,432,428	12,352,142
Dilutive effect of employee stock options and nonvested share awards	-	-
Weighted average diluted common shares outstanding	13,432,428	12,352,142

The Company computes earnings per share using the two-class method, which is an earnings allocation formula that determines earnings per share for common stock and participating securities. The Company’s participating securities are its grants of restricted stock which contain non-forfeitable rights to dividends. The Company allocates earnings between both classes; however, in periods of undistributed losses, they are only allocated to common shares as the unvested restricted stockholders do not contractually participate in losses of the Company. The Company computes basic earnings per share by dividing net income allocated to common shareholders by the weighted average number of shares outstanding during the year. Warrants issued in connection with the Company's long-term debt were issued at a nominal exercise price and are considered outstanding at the date of issuance. Diluted earnings per share is calculated to give effect to all potentially dilutive common shares that were outstanding during the year. Weighted average diluted common shares outstanding include the incremental shares that would be issued upon the assumed exercise of stock options and the assumed vesting of nonvested share awards. For the years ended December 31, 2020 and 2019, 1,078,409 and 659,678 shares, respectively, were not included in the weighted average common shares outstanding calculation as they were anti-dilutive.