General form of registration statement for all companies including face-amount certificate companies

Net Loss Per Share of Common Stock

v3.10.0.1
Net Loss Per Share of Common Stock
3 Months Ended 12 Months Ended
Mar. 31, 2018
Dec. 31, 2017
Earnings Per Share [Abstract]    
Net Loss Per Common Share

Note 6 – Net Loss per Share of Common Stock

 

The Company has preferred stock authorized but no preferred stock issued and outstanding at March 31, 2018 and 2017. There were no outstanding options or warrants issued at March 31, 2018 and 2017.

 

The Company has reported a loss from continuing operations and a loss from continuing operations available to common stockholders for all periods presented. As a result, there is no assumed conversion, exercise or contingent exercise of potential common shares included in the computation of the diluted per share amounts since it would have an antidilutive effect, therefore, basic and diluted loss per share are computed by dividing net loss applicable to common stockholders by the weighted-average number of shares of common stock outstanding.

 

The weighted-average shares of common stock used in calculating basic and diluted loss per share for the 2018 calculation uses the total shares issued and outstanding of 35,272,626. There has been no change in total shares issued and outstanding since December 31, 2017. The weighted-average shares of common stock used in calculating basic and diluted loss per share for the 2017 calculation uses the 31,745,242 shares issued to Promet in the asset purchase transaction for the period from January 1, 2017 through the acquisition date of October 4, 2017 in accordance with ASC 805-40-45, Business Combinations – Reverse Acquisitions. All shares were restated for the one-for-seven reverse split.

 

The calculation of the numerator and denominator for basic and diluted net loss per common share is shown in the following table.

 

    For the three months ended  
    March 31,  
    2018     2017  
             
Net loss from continuing operations applicable to common stockholders - basic and diluted   $ (1,096,798 )   $ (232,442 )
                 
Total common shares issued and outstanding     35,272,626       31,745,242  
                 
Weighted average shares outstanding used in calculating net loss per common share - basic and diluted     35,272,626       31,745,242  
                 
Net loss per common share - basic and diluted   $ (0.03 )   $ (0.01 )

NOTE 9 – NET LOSS PER COMMON SHARE

 

The Company computes loss per share of common stock using the two-class method required for participating securities. The Company’s participating securities include all series of its convertible preferred stock. Undistributed earnings allocated to these participating securities are added to net loss in determining net loss applicable to common stockholders. The Company has preferred stock authorized but no preferred stock issued and outstanding at December 31, 2017 and 2016.

 

The dilutive effect of convertible securities, including the preferred stock, if issued, and the Senior Convertible Notes, are reflected in diluted earnings per share using the if-converted method. As a result, (i) the preferred dividends applicable to the convertible preferred stock are deducted from income from continuing operations and net income in computing income available to common stockholders and, (ii) the interest expense and nondiscretionary adjustments on income that would have been calculated differently had the interest on the Senior Convertible Notes never been recognized, both net of income tax, are added back to the numerator. The convertible preferred stock and the Senior Convertible Notes assume the conversion to common stock at the beginning of the period or the date of issuance, if later, resulting in common shares being included in the denominator.

 

Other convertible securities that may be dilutive on their own but antidilutive when included with other potential common shares in computing diluted earnings per share include options and warrants since the treasury stock method applied to options and warrants has no effect on the numerator in the calculation. However, including potential common shares in the denominator (including convertible preferred stock and Senior Convertible Notes) of a diluted per share computation for continuing operations will always result in an antidilutive per share amount when the Company reports a loss from continuing operations or a loss from continuing operations available to common stockholders (after any preferred dividend deductions).

 

No potential common shares shall be included in the computation of any diluted per share amount when a loss from continuing operations or a loss from continuing operations available to common stockholders (after preferred dividend deduction) exists, even if the entity reports net income (as a result of discontinued operations) since it would be antidilutive. As a result, if there is a loss from continuing operations or a loss from continuing operations available to common stockholders, diluted earnings per share would be computed in the same manner as basic loss per share.

 

There were no outstanding options or warrants issued for the period from August 31, 2015 (inception) through December 31, 2017. See Notes 6 and 8 for further discussion of warrants related to the Senior Convertible Notes and the PIPE financing.

 

The Company has reported a loss from continuing operations and a loss from continuing operations available to common stockholders for all periods presented. As a result, there is no assumed conversion, exercise or contingent exercise of potential common shares included in the computation of the diluted per share amounts since it would have an antidilutive effect, therefore, basic and diluted loss per share are computed by dividing net loss applicable to common stockholders by the weighted-average number of shares of common stock outstanding.

 

The calculation of the numerator and denominator for basic and diluted net loss per common share is shown in the table below. The weighted-average shares of common stock used in calculating basic earnings per share for the 2017 calculation uses the number of shares issued to Promet in the asset purchase transaction from January 1, 2017 through the acquisition date of October 4, 2017 plus all the legal capital issued and outstanding of Heatwurx, including Promet’s shares, from the closing date through December 31, 2017. All shares were restated for the one-for-seven reverse split.

 

The 2016 calculation uses the common shares issued to Promet in the asset purchase transaction, restated for the one-for-seven reverse split and weighted for the issuance dates of Promet’s member interests.

 

    For the year ended  
    December 31, 2017     December 31, 2016  
Net loss from continuing operations   $ (1,856,315 )   $ (1,917,066 )
Less: Preferred stock dividends     -       -  
Net loss from continuing operations applicable to common stockholders - basic     (1,856,315 )     (1,917,066 )
                 
Dilution adjustments (not computed since they are antidilutive):                
Preferred stock dividend     -       -  
Interest on senior convertible notes, net of tax     -       -  
                 
Net loss from continuing operations applicable to common stockholders - diluted   $ (1,856,315 )   $ (1,917,066 )
                 
Promet common shares issued and outstanding     31,745,242       31,745,242  
Heatwurx common shares issued and outstanding     3,527,384       -  
Total common shares issued and outstanding - basic     35,272,626       31,745,242  
                 
Potential common shares (not computed since they are antidilutive):                
Warrants     -       -  
Conversion of preferred stock to common shares     -       -  
Conversion of senior convertible notes to common shares     -       -  
Total common shares issued and outstanding - diluted     35,272,626       31,745,242  
                 
Weighted average shares outstanding used in calculating net loss per common share - basic     32,595,680       29,321,049  
                 
Weighted average shares outstanding used in calculating net loss per common share - diluted     32,595,680       29,321,049  
                 
Net loss per share - basic   $ (0.06 )   $ (0.07 )
                 
Net loss per share - diluted   $ (0.06 )   $ (0.07 )