Per Share Data of HTA

In October 2017, we entered a forward sale arrangement pursuant to a forward equity agreement to sell approximately 2.6 million shares of common stock through our ATM at a price of $29.40 per share, for anticipated proceeds of approximately $75 million to be settled in April 2018, subject to adjustments as provided in the forward equity agreement. To account for the forward equity agreement, we considered the accounting guidance governing financial instruments and derivatives and concluded that our forward equity agreement was not a liability as it did not embody obligations to repurchase our shares of common stock nor did it embody obligations to issue a variable number of shares for which the monetary value was predominately fixed, varying with something other than the fair value of the shares, or varying inversely in relation to our shares. We also evaluated whether the agreement met the derivatives and hedging guidance scope exception to be accounted for as an equity instrument and concluded that the agreement can be classified as an equity contract based on the following assessment: (i) none of the agreements’ exercise contingencies were based on observable markets or indices besides those related to the market for our own stock price and operations; and (ii) none of the settlement provisions precluded the agreement from being indexed to our own common stock.

In addition, we considered the potential dilution resulting from the forward equity agreement on our earnings per common share calculations. We use the treasury method to determine the dilution resulting from the forward equity agreement during the period of time prior to settlement. The number of weighted-average shares outstanding - diluted used in the computation of earnings per common share for the year ended December 31, 2017, includes the effect from the assumed issuance of 2.6 million shares of common stock pursuant to the settlement of the forward equity agreement at the contractual price, less the assumed repurchase of common shares at the average market price using the anticipated proceeds of approximately $75.0 million, adjusted as provided for in the forward equity agreement. The impact to our weighted-average shares - diluted for the year ended December 31, 2017, was 17,000, weighted-average incremental shares.

We include unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents as “participating securities” pursuant to the two-class method. The resulting classes are our common stock and restricted stock. Our forward equity agreement is not considered a participating security and, therefore, is not included in the computation of earnings per share using the two-class method. For the years ended December 31, 2017, 2016 and 2015, all of our earnings were distributed and the calculated earnings per share amount would be the same for all classes.

The following is the reconciliation of the numerator and denominator used in basic and diluted earnings per share of HTA for the years ended December 31, 2017, 2016 and 2015, respectively (in thousands, except per share data):



	Year Ended December 31,
	2017			2016			2015
Numerator:
Net income	$	65,577		$	47,345		$	33,557
Net income attributable to noncontrolling interests	(1,661		)	(1,433		)	(626		)
Net income attributable to common stockholders	$	63,916		$	45,912		$	32,931
Denominator:
Weighted average shares outstanding - basic	181,064			136,620			126,074
Dilutive shares - partnership units convertible into common stock	4,197			3,639			1,930
Dilutive effect of forward equity sales agreement	17			—			—
Adjusted weighted average shares outstanding - diluted	185,278			140,259			128,004
Earnings per common share - basic
Net income attributable to common stockholders	$	0.35		$	0.34		$	0.26
Earnings per common share - diluted
Net income attributable to common stockholders	$	0.34		$	0.33		$	0.26