Weighted Average Shares

9 Months Ended

Sep. 30, 2011

Note 3 - Weighted Average Shares

Basic earnings per common share is computed by dividing net income or loss applicable to common shareholders by the weighted average number of shares outstanding during each period. The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the year, plus the dilutive common stock equivalents that would rise from the exercise of stock options, warrants and restricted stock units outstanding during the period, using the treasury stock method and the average market price per share during the period, plus the effect of assuming conversion of the convertible debt. The computation of diluted earnings per share does not assume conversion or exercise of securities that would have an anti-dilutive effect on earnings.

The following table sets forth the computation of basic and diluted earnings per common share for the three and nine month periods ended September 30, 2011 and 2010:

	For the three months ended					For the nine months ended
	September 30,					September 30,
	2010			2011		2010			2011
Numerator
Net income (loss)	$	(5,524,667	)	$	4,034,154	$	(11,649,358	)	$	3,729,513
Denominator
Basic weighted average shares outstanding		43,098,800			75,844,526		41,402,000			75,240,313
Effect of dilutive securities:
Stock options and warrants		--			19,927		--			179,903
Restricted stock units		--			2,550,000		--			2,550,000
Diluted weighted average shares outstanding		43,098,800			78,414,453		41,402,000			77,970,216

Net income (loss) per common share
Basic	$	(0.13	)	$	0.05	$	(0.28	)	$	0.05
Diluted	$	(0.13	)	$	0.05	$	(0.28	)	$	0.05

Potentially dilutive securities representing 25,193,934 and 24,723,934 shares of common stock were excluded from the computation of diluted earnings per common share for the three and nine months ended September 30, 2011, respectively, because their effect would have been anti-dilutive.