NOTE 7: EARNINGS PER SHARE

Basic income (loss) per share is calculated using the weighted average number of shares of common stock outstanding during the period. In addition, net income applicable to participating securities and the related participating securities are excluded from the computation of basic income per share.

Diluted income per share is calculated using the weighted average number of shares of common stock outstanding during the period and, if there is net income during the period, the dilutive impact of common stock equivalents outstanding during the period. In computing diluted income per share, if convertible debt is assumed to be converted to common shares, the after-tax amount of interest expense recognized in the period associated with the convertible debt is added back to net income.

The Company’s 0.875% Convertible Subordinated Notes would not result in the issuance of any dilutive shares, since the Notes were not convertible and the conversion option was not “in the money” as of July 2, 2011 and July 3, 2010. Accordingly, diluted EPS excludes the effect of the conversion of the 0.875% Convertible Subordinated Notes.

The following tables reflect a reconciliation of the shares used in the basic and diluted net income per share computation for the three and nine months ended July 2, 2011 and July 3, 2010:

	Three months ended
	July 2, 2011						July 3, 2010
(in thousands, except per share data)	Basic			Diluted			Basic			Diluted
NUMERATOR:
Net income	$	70,714		$	70,714		$	49,083		$	49,083
Less: income applicable to participating securities		(394	)		(394	)		(523	)		(523	)
After-tax interest expense		0			n/a			0			118

Net income applicable to common shareholders	$	70,320		$	70,320		$	48,560		$	48,678

DENOMINATOR:
Weighted average shares outstanding - Basic		72,199			72,199			70,131			70,131
Market-based restricted stock					736						463
Time-based restricted stock					836						357
Stock options					359						221
Performance-based restricted stock					-						101
1.000 % Convertible Subordinated Notes					n/a						3,687
Weighted average shares outstanding - Diluted (1)					74,130						74,960

EPS:
Net income per share - Basic	$	0.97		$	0.97		$	0.69		$	0.69

Effect of dilutive shares					(0.02	)					(0.04	)

Net income per share - Diluted				$	0.95					$	0.65

(1) Three months ended July 2, 2011 and July 3, 2010 excludes 0.4 million and 0.5 million dilutive participating securities, respectively, as the income attributable to these shares was not included in EPS.

For the three months ended July 2, 2011 and July 3, 2010, 0.2 million and 1.5 million potentially dilutive shares related to out of the money stock options, respectively, were excluded from EPS.

	Nine months ended
	July 2, 2011						July 3, 2010
(in thousands, except per share data)	Basic			Diluted			Basic			Diluted
NUMERATOR:
Net income	$	125,698		$	125,698		$	86,081		$	86,081

Less: income applicable to participating securities		(755	)		(755	)		(922	)		(922	)
After-tax interest expense		0			n/a			0			363

Net income applicable to common shareholders	$	124,943		$	124,943		$	85,159		$	85,522

DENOMINATOR:
Weighted average shares outstanding - Basic		71,531			71,531			69,873			69,873
Market-based restricted stock					626						379
Time-based restricted stock					677						220
Stock options					248						173
Performance-based restricted stock					-						78
1.000 % Convertible Subordinated Notes					n/a						3,771
Weighted average shares outstanding - Diluted (1)					73,082						74,494

EPS:
Net income per share - Basic	$	1.75		$	1.75		$	1.22		$	1.22

Effect of dilutive shares					(0.04	)					(0.07	)

Net income per share - Diluted				$	1.71					$	1.15

(1) Nine months ended July 2, 2011 and July 3, 2010 excludes 0.4 million dilutive participating securities, for both periods, as the income attributable to these shares was not included in EPS.

For the nine months ended July 2, 2011 and July 3, 2010, 0.5 million and 2.8 million potentially dilutive shares related to out of the money stock options, respectively, were excluded from EPS.