EARNINGS (LOSS) PER SHARE

12 Months Ended

Dec. 31, 2011

EARNINGS (LOSS) PER SHARE

NOTE 15 – EARNINGS (LOSS) PER SHARE

Basic net loss per common share is computed by dividing net loss applicable to common shareholders by the weighted average number of common shares outstanding during the periods presented. Diluted net loss per common share is determined using the weighted average number of common shares outstanding during the periods presented, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of options, warrants and conversion of convertible debt. In periods where losses are reported, the weighted average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive.

The following table provides a reconciliation of the numerators and denominators used in calculating basic and diluted earnings per share for the years ended December 31:

	2011			2010
Basic earnings (loss) per share calculation:
Net income (loss) to common shareholders	$	(14,724,327	)	$	(3,890,271	)
Weighted average of common shares outstanding		38,414,561			23,499,823
Basic net earnings (loss) per share	$	(0.38	)	$	(0.17	)
Diluted earnings (loss) per share calculation:
Net income (loss) per common shareholders	$	(14,724,327	)	$	(3,890,271	)
Basic weighted average common shares outstanding		38,414,561			23,499,823
Stock purchase warrants		(1	)		(2	)
Diluted weighted average common shares outstanding		38,414,561			23,499,823
Diluted net income (loss) per share	$	(0.38	)	$	(0.17	)

(1) As of December 31, 2011, we had (i) 13,719,335 shares of common stock issuable upon the exercise of outstanding stock options, (ii) 12,076,878 shares of common stock issuable upon the exercise of outstanding warrants, (iii) reserved an aggregate of 5,149,378 shares of common stock issuable under outstanding convertible debt agreements and (iv) 1,919,000 shares reserved under private options. These 32,864,591 shares, which would be reduced by applying the treasury stock method, were excluded from diluted weighted average outstanding shares amount for computing the net loss per common share, because the net effect would be antidilutive for the period presented.

(2) As of December 31, 2010, we had (i) 2,800,000 shares of common stock issuable upon the exercise of outstanding stock options and (ii) 3,044,000 shares of common stock issuable upon the exercise of outstanding warrants. These 5,844,000 shares, which would be reduced by applying the treasury stock method, were excluded from diluted weighted average outstanding shares amount for computing the net loss per common share, because the net effect would be antidilutive for the period presented.