Earnings per Common Share

Basic earnings per common share is calculated by dividing net income attributable to common shareholders by the weighted-average number of common shares outstanding during the period excluding the weighted average number of unvested restricted shares outstanding during the period. Diluted earnings per common share is calculated by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period, plus any shares that could potentially be outstanding during the period. Potential shares consist of unvested restricted share grants and unvested performance units, calculated using the treasury stock method. Any anti-dilutive shares have been excluded from the diluted earnings per share calculation.

Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating shares and are considered in the computation of earnings per share pursuant to the two-class method. If there were any undistributed earnings allocable to participating shares, they would be deducted from net income attributable to common shareholders utilized in the basic and diluted earnings per share calculations.

For the years ended December 31, 2014 and 2012 no earnings representing undistributed earnings were allocated to participating shares because the Company paid dividends in excess of net income. For the year ended December 31, 2013, approximately $0.1 million represented undistributed earnings that were allocable to participating shares.

The limited partners’ outstanding limited partnership units in the Operating Partnership (which may be redeemed for common shares of beneficial interest under certain circumstances) have been excluded from the diluted earnings per share calculation as there was no effect on the amounts for the years ended December 31, 2014, 2013 and 2012, since the limited partners’ share of income would also be added back to net income attributable to common shareholders.

The computation of basic and diluted earnings per common share is as follows (in thousands, except share and per share data):



	For the year ended December 31,
	2014			2013			2012
Numerator:
Income from continuing operations attributable to common shareholders, including gain on disposal of hotel properties	$	135,441		$	105,539		$	43,423
Add: Income (loss) from discontinued operations	—			7,382			(2,125		)
Net income attributable to common shareholders	135,441			112,921			41,298
Less: Dividends paid on unvested restricted shares	(951		)	(936		)	(802		)
Less: Undistributed earnings attributable to unvested restricted shares	—			(61		)	—
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares	$	134,490		$	111,924		$	40,496
Denominator:
Weighted-average number of common shares - basic	127,360,669			117,950,066			105,423,604
Unvested restricted shares	316,020			251,217			59,587
Unvested performance units	617,154			537,343			265,495
Weighted-average number of common shares - diluted	128,293,843			118,738,626			105,748,686

Basic per common share data:
Net income per share attributable to common shareholders before discontinued operations - basic	$	1.06		$	0.89		$	0.40
Discontinued operations	—			0.06			(0.02		)
Net income per share attributable to common shareholders - basic	$	1.06		$	0.95		$	0.38

Diluted per common share data:
Net income per share attributable to common shareholders before discontinued operations - diluted	$	1.05		$	0.88		$	0.40
Discontinued operations	—			0.06			(0.02		)
Net income per share attributable to common shareholders - diluted	$	1.05		$	0.94		$	0.38