NOTE

- EARNINGS PER SHARE

EPS is computed by dividing reported net income by the weighted-average number of shares outstanding. Diluted EPS considers the potential dilution that could occur if common stock equivalents were exercised or converted into stock. The

difference between the basic and diluted weighted-average equivalent shares with respect to the Company’s EPS calculation is due entirely to the assumed exercise of stock options and the vesting and settlement of RSUs.

PSAs are included in the computation of diluted shares only to the extent that the underlying performance conditions (i) are satisfied as of the end of the reporting period or (ii) would be considered satisfied if the end of the reporting period were the end of the related performance period and the result would be dilutive under the treasury stock method.

As of

March

31,

2017,

the PSAs granted during the year ended

December

31,

2015

met the related performance conditions and were included in the calculation of diluted EPS. However, the PSAs granted during the year ended

December

31,

2016

and during the

three

-month period ended

March

31,

2017

did not meet the related performance conditions and therefore were excluded. There were

none

and

0.2

million weighted-average shares, primarily associated with stock options, excluded from the calculation of EPS because they were anti-dilutive for the

three

-month periods ended

March

31,

2017

and

2016,

respectively.

The dilutive effect of stock options

, RSUs, and PSAs for each period reported is summarized below:

	Three Months Ended March 31 ,
	2017		201 6
Net Income	$	10,177	$	9,891

Weighted-average number of basic shares outstanding during the period		18,972		18,994
Dilutive effect of stock options, RSUs, and PSAs		451		279
Weighted-average number of diluted shares outstanding during the period		19,423		19,273

Basic earnings per share	$	0.54	$	0.52
Diluted earnings per share	$	0.52	$	0.51