NOTE 14 — LOSS PER SHARE

Basic loss per share is computed by dividing net loss attributable to Signature Group Holdings, Inc. by the weighted average number of common shares outstanding for the reporting period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. For the calculation of diluted earnings per share, the basic weighted average number of shares is increased by the dilutive effect of common stock options, unvested restricted common stock awards and the Warrants determined using the treasury stock method.

Unvested restricted common stock, common stock options and the Warrants are anti-dilutive and excluded from the computation of diluted earnings per share if the assumed proceeds upon exercise or vesting are greater than the cost to reacquire the same number of shares at the average market price during the period. The dilutive impact of these securities could be included in future computations of diluted earnings per share if the Company reports net earnings. For the years ended December 31, 2013 and 2012, the impact of all outstanding unvested restricted common stock, common stock options and the Warrants are excluded from diluted loss per share as their impact would be anti-dilutive.

The following table sets forth the computation of basic and diluted loss per share for the years ended December 31, 2013 and 2012:

	Year Ended December 31,
(Dollars in thousands, except per share amounts)	2013			2012
Loss from continuing operations	$	(10,106	)	$	(3,967	)
Earnings (loss) from discontinued operations, net of income taxes		72			(3,501	)
Net loss		(10,034	)		(7,468	)
Loss attributable to noncontrolling interest		-			-
Net loss attributable to Signature Group Holdings, Inc.	$	(10,034	)	$	(7,468	)

Weighted average basic and diluted shares outstanding		11,847,023			11,612,223
Basic and diluted earnings (loss) per share:
Continuing operations	$	(0.85	)	$	(0.34	)
Discontinued operations		-			(0.30	)
Basic and diluted loss per share	$	(0.85	)	$	(0.64	)

The following table provides details on the average market price of Signature common stock and the incremental shares that would have been included in the diluted shares outstanding computation for the years ended December 30, 2013 and 2012, had they not been anti-dilutive:

	Year Ended December 31,
	2013		2012
Average market price of Signature common stock	$	8.57	$	3.56
Anti-dilutive common stock equivalents:
Unvested restricted stock		252,312		80,913
Common stock options		298,693		1,421
Warrants		301,443		-
Total anti-dilutive common stock equivalents		852,448		82,334