(4) (Loss) Earnings per Share

The Company reports its (loss) earnings per share under the two-class method. Under this method, potentially dilutive securities are excluded from the calculation of diluted earnings per share (as well as their related impact on the net income available to common shareholders) when their impact on net income available to common shareholders is anti-dilutive. During the three and nine months ended September 30, 2017, the Company incurred a net loss, and accordingly, excluded all potentially dilutive securities from the calculation of diluted (loss) earnings per share as their impact on the net loss available to common shareholders was anti-dilutive.

Potentially dilutive securities for the three and nine months ended September 30, 2017 included all outstanding stock options, RSAs, and RSUs, which were included in the calculation of diluted earnings per share for these periods. The potentially dilutive effect of outstanding warrants and the underlying shares exercisable under the Company’s $287.5 million of 1.00% Convertible Senior Notes due 2020 (the “Convertible Notes”) were excluded from diluted shares outstanding because the exercise price exceeded the average market price of the Company’s common shares. The effect of the note hedge the Company purchased to offset the underlying conversion option embedded in the Convertible Notes was also excluded, as the effect is anti-dilutive. Additionally, the restricted shares issued by the Company under RSAs have a non-forfeitable right to cash dividends, if and when declared by the Company. Accordingly, restricted shares issued under RSAs are considered to be participating securities and, as such, the Company has allocated the undistributed earnings for the nine months ended September 30, 2016. The undistributed losses for the three and nine months ended September 30, 2017 have not been allocated to the unvested restricted shares as they do not carry an obligation to share in losses. The allocated details are as follows:

(Loss) Earnings per Share (in thousands, excluding share and per share amounts)


	Three Months Ended					Three Months Ended
	September 30, 2017					September 30, 2016
	Loss		Weighted Average Shares Outstanding	Earnings per Share		Income		Weighted Average Shares Outstanding	Earnings per Share
Basic:
Net (loss) income attributable to controlling interests and available to common shareholders	$	(175,561)				$	27,490
Less: Undistributed earnings allocated to unvested RSAs		—					(9)
Net (loss) income available to common shareholders	$	(175,561)	45,662,543	$	(3.84)	$	27,481	45,252,869	$	0.61

Diluted:
Effect of dilutive securities:
Add: Undistributed earnings allocated to restricted shares	$	—				$	9
Stock options added to the denominator under the treasury stock method			—					20,557
RSUs added to the denominator under the treasury stock method			—					576,635
Less: Undistributed earnings reallocated to RSAs		—					(9)
Net (loss) income available to common shareholders and assumed conversions	$	(175,561)	45,662,543	$	(3.84)	$	27,481	45,850,061	$	0.60


	Nine Months Ended					Nine Months Ended
	September 30, 2017					September 30, 2016
	Loss		Weighted Average Shares Outstanding	Earnings per Share		Income		Weighted Average Shares Outstanding	Earnings per Share
Basic:
Net (loss) income attributable to controlling interests and available to common shareholders	$	(161,304)				$	63,022
Less: Undistributed earnings allocated to unvested RSAs		—					(34)
Net (loss) income available to common shareholders	$	(161,304)	45,597,558	$	(3.54)	$	62,988	45,175,604	$	1.39

Diluted:
Effect of dilutive securities:
Add: Undistributed earnings allocated to restricted shares	$	—				$	34
Stock options added to the denominator under the treasury stock method			—					29,451
RSUs added to the denominator under the treasury stock method			—					560,180
Less: Undistributed earnings reallocated to RSAs		—					(33)
Net (loss) income available to common shareholders and assumed conversions	$	(161,304)	45,597,558	$	(3.54)	$	62,989	45,765,235	$	1.38

The computation of diluted earnings per share excluded potentially dilutive common shares related to restricted shares issued by the Company under RSAs of 7,217 and 12,920 for the three and nine months ended September 30, 2016, respectively, because the effect of including these shares in the computation would have been anti-dilutive.