Earnings per Share

6 Months Ended

Jun. 30, 2017

Earnings per Share

Earnings per Share

11.  Earnings per Share

Basic income per common share is determined by dividing income attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents. Diluted income per share is computed by dividing the income attributable to common stockholders by the weighted-average number of common share equivalents outstanding for the period. The treasury stock method is used to determine the dilutive effect of the Company’s stock option grants, SAR, and potential ESPP awards, and the if-converted method is used to determine the dilutive effect of the Company’s Notes.

The following common stock equivalents were excluded in the calculation of diluted income per share because their effect would be anti-dilutive as applied to the income from continuing operations applicable to common stockholders for the three and six months ended June 30, 2017 and 2016:

	Three Months ended June 30,		Six Months ended June 30,
	2017	2016	2017	2016
	(unaudited)		(unaudited)
Shares underlying Convertible Senior Secured Notes	—	—	—	—
Stock options, stock appreciation rights, and ESPP awards	122,666	1,124,100	206,448	1,159,100

The following table sets forth the computation of basic and diluted net income per share for the three and six months ended June 30, 2017 and 2016, in thousands, except share and per share amounts:

	Three Months ended June 30,						Six Months ended June 30,
	2017			2016			2017			2016
	(unaudited)						(unaudited)
Numerator, in thousands:
Net income used for calculation of basic EPS	$	17,368		$	10,251		$	27,665		$	15,076
Interest expense on convertible debt	58			196			147			375
Changes in fair value of derivative liabilities	(23		)	(123		)	(76		)	(224		)
Loss on extinguishment of debt	103			—			204			382
Loss on extinguishment of outstanding debt, as if converted	(258		)	(849		)	(321		)	(1,183		)
Total adjustments	(120		)	(776		)	(46		)	(650		)
Net income used for calculation of diluted EPS	$	17,248		$	9,475		$	27,619		$	14,426
Denominator:
Weighted average shares outstanding, basic	50,530,968			49,427,825			50,345,830			49,333,962
Effect of dilutive potential common shares:
Shares underlying Convertible Senior Secured Notes	421,708			1,240,814			551,235			1,301,885
Shares issuable to settle interest make-whole derivatives	4,631			52,563			7,013			71,537
Stock options and stock appreciation rights	2,266,407			1,024,140			2,122,245			777,302
Total potential dilutive common shares	2,692,746			2,317,517			2,680,493			2,150,724
Weighted average shares outstanding, diluted	53,223,714			51,745,342			53,026,323			51,484,686
Net income per share, basic	$	0.34		$	0.21		$	0.55		$	0.31
Net income per share, diluted	$	0.32		$	0.18		$	0.52		$	0.28