NOTE 14: EARNINGS PER SHARE

The Company computes earnings (loss) per common share (“EPS”) under the two-class method which requires the allocation of all distributed and undistributed earnings to common stock and other participating securities based on their respective rights to receive distributions of earnings or losses. The Company’s Class A Common Stock and Class B Common Stock equally share in distributed and undistributed earnings. The Company accounts for the Warrants as participating securities, as holders of the Warrants, in accordance with and subject to the terms and conditions of the Warrant Agreement, are entitled to receive ratable distributions of the Company’s earnings concurrently with such distributions made to the holders of Common Stock, subject to certain restrictions relating to FCC rules and requirements. Under the terms of the Company’s RSU and PSU agreements, unvested RSUs and PSUs contain forfeitable rights to dividends and DEUs. Because the DEUs are forfeitable, they are defined as non-participating securities. As of September 30, 2016, there were 39,628 DEUs outstanding, which will vest at the time that the underlying RSU or PSU vests.

The Company computes basic EPS by dividing net income (loss) applicable to common shares by the weighted average number of common shares outstanding during the period. In accordance with the two-class method, undistributed earnings applicable to the Warrants are excluded from the computation of basic EPS. Diluted EPS is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period as adjusted for the assumed exercise of all outstanding stock awards. The calculation of diluted EPS assumes that stock awards outstanding were exercised at the beginning of the period. The stock awards are included in the calculation of diluted EPS only when their inclusion in the calculation is dilutive.

ASC Topic 260, “Earnings per Share,” states that the presentation of basic and diluted EPS is required only for common stock and not for participating securities. For the three and nine months ended September 30, 2016, 159,243 and 194,943, respectively, of the weighted-average Warrants outstanding, have been excluded from the below table. For the three and nine months ended September 30, 2015, 308,612 and 1,069,798, respectively, of the weighted-average Warrants outstanding, have been excluded from the below table.

The calculation of basic and diluted EPS is presented below (in thousands, except for per share data):



	Three Months Ended				Nine Months Ended
	September 30, 2016		September 30, 2015		September 30, 2016			September 30, 2015
EPS numerator:
Net income (loss), as reported	$	145,765	$	27,858	$	(4,705	)	$	61,010
Less: Dividends distributed to Warrants	40		77		127			249
Less: Undistributed earnings allocated to Warrants	218		91		—			679
Net income (loss) attributable to common shareholders for basic EPS	$	145,507	$	27,690	$	(4,832	)	$	60,082
Add: Undistributed earnings allocated to dilutive securities	1		—		—			2
Net income (loss) attributable to common shareholders for diluted EPS	$	145,508	$	27,690	$	(4,832	)	$	60,084

EPS denominator:
Weighted average shares outstanding - basic	89,950		94,437		91,367			95,060
Impact of dilutive securities	503		75		—			214
Weighted average shares outstanding - diluted	90,453		94,512		91,367			95,274

Net income (loss) per share attributable to common shareholders:
Basic	$	1.62	$	0.29	$	(0.05	)	$	0.63
Diluted	$	1.61	$	0.29	$	(0.05	)	$	0.63

Since the Company was in a net loss position for the nine months ended September 30, 2016, there was no difference between the number of shares used to calculate basic and diluted loss per share in the period. Because of their anti-dilutive effect, 1,714,643 and 2,148,796 common share equivalents, comprised of NSOs, PSUs, Supplemental PSUs and RSUs, have been excluded from the diluted EPS calculation for the three and nine months ended September 30, 2016, respectively. Because of their anti-dilutive effect, 2,189,552 and 1,489,698 common share equivalents, comprised of NSOs, PSUs and RSUs, have been excluded from the diluted EPS calculation for the three and nine months ended September 30, 2015, respectively.