7. Net Income Per Share

The Company calculates basic net income per share by dividing net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share takes into account the effect of potential dilutive common shares when the effect is dilutive. The effect of potential dilutive common shares, including common stock issuable upon exercise of outstanding stock options and stock purchase warrants, is computed using the treasury stock method. The effect of potential dilutive common shares from the conversion of the outstanding convertible preferred securities is computed using the as-if converted method at the stated conversion rate. The Company’s unvested RSUs contain non-forfeitable rights to dividends and therefore are considered to be participating securities in periods of net income. The calculation of basic and diluted net income per share excludes net income attributable to the unvested RSUs from the numerator and excludes the impact of unvested RSUs from the denominator.

The computations of basic and diluted net income per share are set forth as follows:

	Three Months Ended June 30,
	2014		2013

	(in thousands, except per share data)
Numerator:
Net income attributable to common stockholders	$	12,167	$	13,663
Net income allocated to participating securities		(11)		(16)
Numerator for basic net income per share		12,156		13,647
Dividends on Series A Preferred Stock		-		1,750
Dividends on Series B Preferred Stock		1,102		-
Numerator for diluted net income per share	$	13,258	$	15,397

Denominator:
Denominator for basic net income per share - weighted average outstanding common shares		86,793		76,900
Dilutive effect of stock options		9		-
Dilutive effect of contingently issuable shares		27		28
Dilutive effect of Series A Preferred Stock		-		10,602
Dilutive effect of Series B Preferred Stock		8,824		-
Denominator for diluted net income per share		95,653		87,530

Net income per share attributable to common stockholders - basic	$	0.14	$	0.18
Net income per share attributable to common stockholders - diluted	$	0.14	$	0.18

For the three months ended June 30, 2014, warrants to purchase 0.3 million shares of common stock and options to purchase 4.3 million shares of common stock were not included in the computation of diluted net income per share as the effect would be anti-dilutive. In addition, 10.6 million shares of Series A Preferred Stock, which represent the weighted-average number of shares of common stock calculated using the as-if converted method, were also excluded from the calculation of diluted net income per share, as the effect would be anti-dilutive. For the three months ended June 30, 2014, 1.4 million unvested RSUs were excluded from the computation of basic and diluted net income per share.

For the three months ended June 30, 2013, warrants to purchase 0.3 million shares of common stock and options to purchase 5.1 million shares of common stock were not included in the computation of diluted net income per share as the effect would be anti-dilutive. Additionally, for the three months ended June 30, 2013, 1.0 million unvested RSUs were excluded from the computation of basic and diluted net income per share.

	Six Months Ended June 30,
	2014		2013

	(in thousands, except per share data)
Numerator:
Net income attributable to common stockholders	$	26,960	$	26,847
Net income allocated to participating securities		(30)		(37)
Numerator for basic net income per share		26,930		26,810
Dividends on Series A Preferred Stock		-		3,500
Dividends on Series B Preferred Stock		1,102		-
Numerator for diluted net income per share	$	28,032	$	30,310

Denominator:
Denominator for basic net income per share - weighted average outstanding common shares		81,964		76,834
Dilutive effect of stock options		4		-
Dilutive effect of contingently issuable shares		40		41
Dilutive effect of Series A Preferred Stock		-		10,602
Dilutive effect of Series B Preferred Stock		4,436		-
Denominator for diluted net income per share		86,444		87,477

Net income attributable to common stockholders per share - basic	$	0.33	$	0.35
Net income attributable to common stockholders per share - diluted	$	0.32	$	0.35

For the six months ended June 30, 2014, warrants to purchase 0.3 million shares of common stock and options to purchase 4.8 million shares of common stock were not included in the computation of diluted net income per share as the effect would be anti-dilutive. In addition, 10.6 million shares of Series A Preferred Stock, which represent the weighted-average number of shares of common stock calculated using the as-if converted method, were also excluded from the calculation of diluted net income per share, as the effect would be anti-dilutive. For the six months ended June 30, 2014, 1.3 million unvested RSUs were excluded from the computation of basic and diluted net income per share.

For the six months ended June 30, 2013, warrants to purchase 0.4 million shares of common stock and options to purchase 5.2 million shares of common stock were not included in the computation of diluted net income per share as the effect would be anti-dilutive. Additionally, for the six months ended June 30, 2013, 0.9 million unvested RSUs were excluded from the computation of basic and diluted net income per share.