5. Calculation of Basic and Diluted Earnings per Share

9 Months Ended

Sep. 30, 2016

Earnings (loss) per common share:

Calculation of Basic and Diluted Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share:

(in thousands, except per share amounts)		Three Months Ended September 30,				Nine Months Ended September 30,
		2016		2015		2016		2015
Numerator:
Net Income (Loss) - basic and diluted	$	291	$	(121)	$	622	$	(418)
Denominator:
Denominator for basic earnings (loss) per share - weighted-average shares		3,542		3,014		3,319		3,014
Effect of dilutive securities:
Employee stock options		8		-		3		-
Warrants		-		-		76		-
Dilutive potential common shares		8		-		79		-
Denominator for diluted earnings (loss) per share - weighted-average shares and assumed conversions		3,550		3,014		3,398		3,014
Basic earnings (loss) per common share	$	0.08	$	(0.04)	$	0.19	$	(0.14)
Diluted earnings (loss) per common share	$	0.08	$	(0.04)	$	0.18	$	(0.14)

For the three and nine month periods ended September 30, 2016, approximately 130,000 employee stock options were excluded from the calculation of diluted earnings per share as the exercise price was greater than the market price of the common shares and, therefore, the effect would be anti-dilutive.

For the three and nine month periods ended September 30, 2015, approximately 146,000 employee stock options were excluded from the calculation of diluted earnings per share as the effect would be anti-dilutive.