The Company is required to apply the two-class method to compute both basic and diluted net income per share. The two-class method is an earnings allocation formula that treats participating securities as having rights to earnings that would otherwise have been available to common stockholders.

The following table presents information necessary to calculate net income per share for the periods presented, as well as potentially dilutive securities excluded from the weighted average number of diluted common shares outstanding because their inclusion would have been anti-dilutive:

	Three Months Ended June 30,
(In thousands, except per share data)	2020			2019
NET INCOME PER SHARE—BASIC:
Net income (loss) attributable to ADS	$	70,466		$	(226,356	)
Adjustments for:
Dividends to redeemable convertible preferred stockholders		(1,366	)		(6,841	)
Dividends paid to unvested restricted stockholders		(2	)		(328	)
Net income (loss) available to common stockholders and participating securities		69,098			(233,525	)
Undistributed income allocated to participating securities		(11,242	)		—
Net income (loss) available to common stockholders – Basic	$	57,856		$	(233,525	)
Weighted average number of common shares outstanding – Basic		69,380			57,576
Net income (loss) per common share – Basic	$	0.83		$	(4.06	)
NET INCOME PER SHARE—DILUTED:
Net income (loss) available to common stockholders – Diluted	$	57,856		$	(233,525	)
Weighted average number of common shares outstanding – Basic		69,380			57,576
Assumed exercise of stock options		573			—
Restricted stock		173			—
Weighted average number of common shares outstanding – Diluted		70,126			57,576
Net income (loss) per common share – Diluted	$	0.83		$	(4.06	)
Potentially dilutive securities excluded as anti-dilutive		15,161			10,806

Special Dividend and the Employees Stock Ownership Plan (“ESOP”) - During the three months ended June 30, 2019, the Board of Directors approved a special cash dividend of $1.00 per share and quarterly dividends of $0.09 per share. The special and quarterly dividend were paid to all stockholders on June 14, 2019 to stockholders of record at the close of business on June 3, 2019. The total dividend payment was $81.6 million. The dividends received by the unallocated redeemable convertible preferred stock held in the ESOP trust was used to pay $12.0 million of the ESOP loan back to the Company resulting in approximately 11.6 million shares of the Company’s redeemable convertible preferred stock being allocated to ESOP participants. The Company recognized $246.8 million in stock-based compensation expense based on the fair value on the date the Board of Directors approved the special dividend. The Board of Director’s approval committed the ESOP to use those proceeds to pay down the ESOP loan. The special dividend compensation expense was recognized in Cost of goods sold - ESOP special dividend compensation and Selling, general and administrative expenses - ESOP special dividend compensation on the Company’s Consolidated Statement of Operations. The

Company’s ESOP is further described in “Note 16. Employee Benefit Plans” to the Company’s audited financial statements included in the Fiscal 2020 Form 10-K.