12. Earnings per Share

Basic earnings per share is calculated using the weighted-average number of common shares outstanding. Diluted earnings per share is calculated using the weighted-average number of common shares, as per the treasury stock method under the dilutive effect of the Company’s stock option grants, SAR, warrants, ESPP awards and the 2023 Notes, as determined.

The following common stock equivalents were excluded in the calculation of diluted earnings per share because their inclusion would be anti-dilutive, as applied to the earnings from continuing operations, and as applicable to common stockholders, for the years ended December 31, 2018, 2017 and 2016:


	Years Ended December 31,
	2018	2017	2016
Warrants to purchase common stock	3,949,743	—	—
Convertible notes	87,215	—	—
Convertible notes hedges	87	—	—
Stock options, SAR and ESPP awards	199,982	40,009	22,944

The following table sets forth the computation of basic and diluted net earnings per share for the years ended December 31, 2018, 2017 and 2016, in thousands of dollars, except share and per share amounts:


	Years Ended December 31,
	2018		2017		2016

Numerator, in thousands:
Net earnings used for calculation of basic EPS	$	110,993	$	57,284	$	91,221
Interest expense on convertible debt		—		134		543
Changes in fair value of derivative liabilities		—		(76)		(448)
Loss on extinguishment of debt		—		295		671
Loss on extinguishment of outstanding debt, as if converted		—		(321)		(1,182)
Total adjustments		—		32		(416)
Net earnings used for calculation of diluted EPS	$	110,993	$	57,316	$	90,805

Denominator:
Weighted average shares outstanding, basic		51,989,824		50,756,603		49,472,434
Effect of dilutive potential common shares:
Shares underlying Convertible Senior Notes		—		285,257		1,222,363
Shares issuable to settle interest make-whole derivatives		—		7,012		71,537
Stock options and SAR		2,109,048		2,252,278		942,649
Total dilutive potential common shares		2,109,048		2,544,547		2,236,549
Weighted average shares outstanding, diluted		54,098,872		53,301,150		51,708,983

Net earings per share, basic	$	2.13	$	1.13		1.84
Net earnings per share, diluted	$	2.05	$	1.08		1.76