NOTE 7.

EARNINGS (LOSS) PER SHARE:

Basic income (loss) per share is computed based upon the weighted average number of common shares outstanding for the period. When applicable, diluted income (loss) per share is calculated using two approaches. The first approach, the treasury stock method, reflects the potential dilution that could occur if outstanding stock options, warrants, restricted stock units and outstanding shares to be awarded to satisfy contingent consideration for the business combinations described in Note 3 (collectively, the “Equity Awards”) were exercised and issued. The second approach, the if converted method, reflects the potential dilution of the Equity Awards, the 8% Convertible Unsecured Promissory Notes (the “2017 Notes”) described in Note 10 being exchanged for common stock. Under this method, interest expense, net of tax, if any, associated with the 2017 Notes, up through redemption, is added back to net income attributable to common stockholders and the shares outstanding are increased by the underlying 2017 Notes are considered to be issued.

For the nine months ended September 30, 2018, the effect of 446,429 shares related to the exchange of the 2017 Notes for common stock were excluded from the calculation of diluted income (loss) per share, as the effect would be anti-dilutive.

As of September 30, 2018, the effect of approximately 14,544,000 shares respectively, related to the issuance of common stock upon exercise of Equity Awards were excluded from the calculation of diluted income (loss) per share, as the effect would be anti-dilutive.

As of September 30, 2017, no shares related to the issuance of common stock upon exercise of the Equity Awards or the exchange of the 2017 Notes for common stock were considered in the calculation of diluted loss per share, as the effect would be anti-dilutive due to net losses attributable to common stockholders for both the three and nine month periods ended September 30, 2017.

The following table sets forth the computation of basic and diluted income (loss) per share for the three and nine months ended September 30, 2018 and 2017:

	For the Three Months Ended					For the Nine Months Ended
	September 30, 2018		September 30, 2017			September 30, 2018		September 30, 2017
Numerator for basic and diluted income (loss) per share:
Net income (loss) attributable to common stockholders	$	3,883,015	$	(4,609,468	)	$	389,488	$	(9,615,628	)
Numerator for diluted income (loss) per share:
Net income (loss) attributable to common stockholders - as reported	$	3,883,015	$	(4,609,468	)	$	389,488	$	(9,615,628	)
Interest expense on 2017 Notes, net of taxes		25,000		—			-		—
Net income (loss) attributable to common stockholders - after assumed conversions of dilutive shares	$	3,908,015	$	(4,609,468	)	$	389,488	$	(9,615,628	)
Denominator for weighted average common shares outstanding:
Basic shares		21,657,181		14,715,947			19,683,610		14,472,322
Dilutive effect of Equity Awards		2,080,654		__			946,532		__
Dilutive effect of 2017 Notes		446,429		—			—		—
Diluted shares		24,184,264		14,715,947			20,630,142		14,472,322

Income (loss) per share – basic:
Net income (loss)	$	0.18	$	(0.31	)	$	0.02	$	(0.66	)

Income (loss) per share – diluted:
Net income (loss)	$	0.16	$	(0.31	)	$	0.02	$	(0.66	)