. LOSS PER SHARE COMMON STOCK (“EPS”)

The Company

’s basic EPS is calculated using net 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 numerators of the basic and diluted EPS calculations was as follows for both of the following

three

and

nine

month periods ended

September 30, 2017

and

2016:

	Three Months ended September 30,						Nine Months ended September 30,
	201 7			201 6			201 7			201 6

Basic Numerator:
Net loss	$	(1,605,784	)	$	(1,134,422	)	$	(4,751,301	)	$	(3,673,125	)
Convertible preferred stock dividends		(200,625	)		(200,625	)		(601,875	)		(601,875	)
Net loss available to common stockholders	$	(1,806,409	)	$	(1,335,047	)	$	(5,353,176	)	$	(4,275,000	)
Basic Denominator		6,535,449			5,530,105			6,333,530			5,521,218
Per Share Amount	$	(0.28	)	$	(0.24	)	$	(0.85	)	$	(0.77	)

All potential common shares were antidilutive, and accordingly diluted EPS equaled basic EPS for all periods presented in the accompanying financial statements.

The following table sets forth the options and warrants which were excluded from the diluted per share calculation even though the exercise prices were less than the average market price of the common shares because the effect of including these potential shares was antidilutive due to the net losses for the

three

and

nine

months ended

September 30, 2017

and

2016:

	Three Months ended September 30,				Nine Months ended September 30,
	201 7		201 6		201 7		201 6

Preferred stock		5,416,667		5,416,667		5,416,667		5,416,667
Stock options		205,497		28,992		101,327		13,398
Warrants		9,492		6,529		5,608		-
Total		5,631,656		5,452,188		5,523,602		5,430,065

Items 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 September 30,				Nine Months ended September 30,
	201 7		201 6		201 7		201 6

Stock options		262,094		215,000		278,761		231,667
Warrants		1,351,052		1,656,702		1,351,052		1,704,618
Total		1,613,146		1,871,702		1,629,813		1,936,285