Note 7 - Earnings Per Share ("EPS")

3 Months Ended

Mar. 31, 2016

7.	EARNINGS PER SHARE (“EPS”)

The Company’s basic EPS is calculated using net income (loss) available to common shareholders and the weighted-average number of shares outstanding during the reporting period. Diluted EPS includes the effect from potential issuance of common stock, such as stock issuable pursuant to the exercise of stock options and warrants and the assumed conversion of convertible notes and preferred stock.

The reconciliation of the numerator of the basic and diluted EPS calculations was as follows for the three month periods ended March 31, 2016 and 2015:

	Three Months ended March 31,
	2015			2015

Basic Numerator:

Net loss	$	(1,163,214	)	$	(924,103	)
Convertible preferred stock dividends		(200,625	)		-
Net loss available to common stockholders (basic and diluted)	$	(1,363,839	)	$	(924,103	)

Basic Denominator		66,123,757			66,001,260

Per Share Amount	$	(0.02	)	$	(0.01	)

The following table summarizes the weighted average securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to the net losses for the three months ended March 31, 2016 and 2015:

	Three Months ended March 31,
	2016		2015

Preferred stock		65,000,000		-
Stock options		6,000		75,760
Warrants		-		5,336
Total		65,006,000		81,096

The following table sets forth options and warrants which were excluded from the diluted per share calculation because the exercise price was greater than the average market price of the common shares:

	Three Months Ended March 31,
	2016		2015

Stock options		3,758,000		3,382,805
Warrants		20,455,414		19,047,081
Total		24,213,414		22,429,886