Note 5: NET (LOSS) InCOME PER SHARE

Basic (loss) income per common share is computed by dividing net (loss) income by the weighted average number of common shares outstanding during the reporting period. Diluted income per common share is computed similar to basic income per common share except that it reflects the potential dilution that could occur if dilutive securities or other obligations to issue common stock were exercised or converted into common stock.

Income (loss) per-share amounts for all prior periods have been retroactively adjusted to reflect the Company’s 1-for-12 reverse stock split, which was effective September 16, 2016.

The following table sets forth the computation of net loss per share:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2017		2016		2017		2016
Numerator:
Net (loss) income	$	(1,893,377)	$	5,974,140	$	(4,313,262)	$	1,224,401
Less: non-cash income from change in fair value of common stock warrants		-		3,697,000		-		2,492,000
Net (loss) income - diluted		(1,893,377)		2,277,140		(4,313,262)		(1,267,599)

Denominator:
Weighted average common shares outstanding - basic		8,576,634		5,935,000		8,503,521		5,908,917
Dilutive effect of warrants, net		-		565,417		-		743,500
Dilutive effect of stock options, net		-		24,333		-		-
Weighted average common shares outstanding - diluted		8,576,634		6,524,750		8,503,521		6,652,417

Net (loss) income per share data:
Basic	$	(0.22)	$	1.01	$	(0.51)	$	0.21
Diluted	$	(0.22)	$	0.35	$	(0.51)	$	(0.19)

The following securities, rounded to the thousand, were not included in the diluted net loss per share calculation because their effect was anti-dilutive for the periods presented:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2017		2016		2017		2016
Common stock options		455,000		251,000		455,000		297,000
Common stock warrants - equity treatment		6,540,000		213,000		6,540,000		213,000
Common stock warrants - liability treatment		3,500		2,283,000		3,500		2,068,000
Potentially dilutive securities		6,998,500		2,747,000		6,998,500		2,578,000