(4) Earnings per Share

The Company reports its earnings per share under the two-class method. Under this method, potentially dilutive securities are excluded from the calculation of diluted earnings per share (as well as their related impact on the net income available to common stockholders) when their impact on net income available to common stockholders is anti-dilutive. Potentially dilutive securities for the year ended December 31, 2013, 2012, and 2011 included all outstanding stock options and shares of restricted stock, which were included in the calculation of diluted earnings per share for these periods. The potentially dilutive effect of outstanding warrants and the underlying shares exercisable under the Company’s convertible notes were excluded from diluted shares outstanding because the exercise price exceeded the average market price of the Company’s common stock. The effect of the note hedge the Company purchased to offset the underlying conversion option embedded in its convertible notes was also excluded, as the effect is anti-dilutive.

The shares of restricted stock issued by the Company have a non-forfeitable right to cash dividends, if and when declared by the Company. Accordingly, restricted shares are considered to be participating securities and, as such, the Company has allocated the undistributed earnings for the year ended December 31, 2013, 2012, and 2011 among the Company's outstanding shares of common stock and issued but unvested restricted shares, as follows:

Earnings per Share (in thousands, excluding share and per share amounts):



	2013
	Income		Weighted Average Shares Outstanding		Earnings Per Share
Basic:
Net income attributable to controlling interests and available to common stockholders	$	23,816
Less: Undistributed earnings allocated to unvested restricted shares		(672)
Net income available to common stockholders	$	23,144		44,371,313	$	0.52

Diluted:
Effect of dilutive securities:
Add: Undistributed earnings allocated to restricted shares	$	672
Stock options added to the denominator under the treasury stock method				206,322
Less: Undistributed earnings reallocated to restricted shares		(669)
Net income available to common stockholders and assumed conversions	$	23,147		44,577,635	$	0.52



	2012						2011
	Income		Weighted Average Shares Outstanding		Earnings Per Share		Income		Weighted Average Shares Outstanding		Earnings Per Share
Basic:
Net income attributable to controlling interests and available to common stockholders	$	43,591					$	70,233
Less: Undistributed earnings allocated to unvested restricted shares		(1,497)						(2,626)
Net income available to common stockholders	$	42,094		43,469,175	$	0.97	$	67,607		42,201,491	$	1.60

Diluted:
Effect of dilutive securities:
Add: Undistributed earnings allocated to restricted shares	$	1,497					$	2,626
Stock options added to the denominator under the treasury stock method				406,157						685,289
Less: Undistributed earnings reallocated to restricted shares		(1,483)						(2,586)
Net income available to common stockholders and assumed conversions	$	42,108		43,875,332	$	0.96	$	67,647		42,886,780	$	1.58

The computation of diluted earnings per share excluded potentially dilutive common shares related to restricted stock (including both RSAs and RSUs) of 516,127 shares, 630,537 shares, and 501,331 shares for the year ended December 31, 2013, 2012, and 2011, respectively, because the effect of including these shares in the computation would have been anti-dilutive.