Note 2: Net income (loss) per Common Share

The following table sets forth the computation of basic and diluted net income (loss) per common share:

	Three months ended					Nine months ended
	September 30,					September 30,
(dollars in thousands, except per share amounts)	2018		2017			2018		2017

Numerator:

Net income (loss)	$	3,916	$	(259	)	$	10,079	$	(250	)

Denominator:

Weighted average number of shares of common stock outstanding (A)		8,699,953		7,228,277			7,931,783		7,221,426
Weighted average effect of dilutive stock options and other stock compensation		252,796		-			234,976		-

Weighted average number of shares of common stock outstanding, as adjusted		8,952,749		7,228,277			8,166,759		7,221,426

Net income (loss) per common share:

Net income (loss) per common share - Basic	$	0.45	$	(0.04	)	$	1.27	$	(0.03	)

Net income (loss) per common share - Diluted	$	0.44	$	(0.04	)	$	1.23	$	(0.03	)

(A)

Calculation includes weighted average of 1,408,163 shares in the aggregate issued on May 25 and June 5, 2018 as part of an underwritten public offering by the Company.

On May 25, 2018, the Company completed an underwritten, public offering involving the issuance and sale by the Company of 1,224,490 shares of common stock at a public offering price of $24.50 per share. In addition, the Company granted the underwriters a 30-day option to purchase up to an additional 183,673 shares of common stock. On June 1, 2018, the underwriters exercised the option in full, and an additional 183,673 shares of common stock were issued and sold on June 5, 2018. The public offering resulted in gross proceeds to the Company of approximately $34.5 million, or $32.2 million net of the underwriting discount and other offering fees and expenses. We used the net proceeds from the public offering to repay amounts outstanding under the Company’s revolving credit facility. The public offering’s impact on the weighted average number of shares for the three and nine months ending September 30, 2018 is 1.4 million shares and 0.7 million shares, respectively.

We had options to purchase 236,000 and 495,675 shares of common stock outstanding at a weighted average price of $34.53 and $31.74 for the three months ended September 30, 2018 and 2017 which were excluded in the computation of diluted net income (loss) per common share for the three months ended September 30, 2018 and 2017, respectively. We had options to purchase 261,000 and 566,075 shares of common stock outstanding at an average price of $33.86 and $30.21 which were excluded in the computation of diluted net income (loss) per common share for the nine months ended September 30, 2018 and 2017, respectively. These outstanding options were not included in the computation of diluted net income (loss) per common share because their exercise prices were greater than the average market price of our common stock. The calculation of diluted net loss per common share for the three months ended September 30, 2017 excluded 121,750 shares, for the assumed exercise of stock options as a result of being in a net loss position. The calculation of diluted net loss per common share for the nine months ended September 30, 2017 excluded 99,638 shares, for the assumed exercise of stock options as a result of being in a net loss position. In addition, for the three and nine months ended September 30, 2017, the calculation of diluted net loss per share excluded 39,216 and 29,101 shares, respectively, for the assumed issuance of stock for restricted stock units as a result of being in a net loss position.