Two warrant issues Exercisable at Potential proceeds Shares Outstanding 10,000,000 Stock Price $ 6.00 Warrants A 2,000,000 $2.00 Warrants B 3,000,000 $5.00 Step 1 Exercise all in the money warrants A proceeds B proceeds Total Proceeds Step 2 Buy back shares with proceeds - Share calculations Original Shares 10,000,000 Added on Exercise A B Total New (temp) Bought back - - Net Diluted Shares - Earnings $20,000,000 EPS Basic EPS Diluted