Earnings per Share

For the nine and three months ended September 30, 2011, earnings per share was calculated using the treasury method which included the Series D Preferred Stock assumed to be converted to 1,875,000 shares of Common Stock that shared in distributions with common shareholders on a 1:1 basis through the date of the Recapitalization. See Note 3 to the condensed consolidated financial statements for further details. The weighted average common shares outstanding for the nine and three months ended September 30, 2011 also include the effect of the newly-issued Common Stock.

Prior to the Recapitalization during June 2011, the Series D Preferred Stock were considered participating securities and therefore the earnings per share information below is calculated under the two-class method for the nine and three months ended September 30, 2010. In determining the number of diluted shares outstanding, the relevant guidance requires disclosure of the more dilutive earnings per share result between the if-converted method calculation and the two-class method calculation. For both the nine and three months ended September 30, 2010, the two-class method calculation was more dilutive; therefore, the earnings per share information below is presented following the two-class method which includes convertible participating preferred stock assumed to be converted to 1,875,000 shares of common stock that share in distributions with common shareholders on a 1:1 basis. As the holders of the Series D Preferred Stock did not have an obligation to participate in losses, no allocation of undistributed losses was necessary for the three months ended September 30, 2010.

The computations of basic and diluted earnings per share for the nine and three months ended September 30, 2011 and 2010 (dollars in thousands, except share and per share amounts) are as follows:



	For the Nine Months Ended September 30,						For the Three Months Ended September 30,
	2011			2010			2011			2010
Numerator:
Net income	$	6,688		$	985,318		$	4,202		$	3,336
Less income (loss) attributable to noncontrolling interests	2			(804		)	(244		)	(105		)
Dividends on preferred shares	(8,428		)	(12,234		)	—			(4,183		)
Net effect of preferred stock exchange (A)	95,460			—			—			—
Allocation of undistributed income to convertible participating preferred stock	—			(162,862		)	—			—
Income (loss) available to common shareholders	$	93,718		$	811,026		$	4,446		$	(742	)

Denominator:
Weighted average common shares outstanding - basic	39,261,555			9,337,207			90,326,299			9,337,207

Weighted average common shares outstanding - dilutive:
Weighted average common shares outstanding - basic	39,261,555			9,337,207			90,326,299			9,337,207
Restricted stock	165,769			—			491,901			—
Weighted average common shares outstanding - dilutive	39,427,324			9,337,207			90,818,200			9,337,207

Basic earnings per share:
Net income	$	0.17		$	105.53		$	0.05		$	0.36
Less loss attributable to noncontrolling interests	—			(0.08		)	—			(0.01		)
Dividends on preferred shares	(0.21		)	(1.31		)	—			(0.45		)
Net effect of preferred stock exchange (A)	2.43			—			—			—
Allocation of undistributed income to convertible participating preferred stock	—			(17.44		)	—			—
Net income (loss) available to common shareholders	$	2.39		$	86.86		$	0.05		$	(0.08	)

Diluted earnings per share:
Net income	$	0.17		$	105.53		$	0.05		$	0.36
Less loss attributable to noncontrolling interests	—			(0.08		)	—			(0.01		)
Dividends on preferred shares	(0.21		)	(1.31		)	—			(0.45		)
Net effect of preferred stock exchange (A)	2.42			—			—			—
Allocation of undistributed income to convertible participating preferred stock	—			(17.44		)	—			—
Net income (loss) available to common shareholders	$	2.38		$	86.86		$	0.05		$	(0.08	)

(A)

The net effect of the preferred stock exchange includes amounts attributable to the Series C Offer and the Series D Exchange and was calculated in accordance with applicable Earnings per Share guidance. The Series C Offer amount is calculated as the difference between (1) the fair value of the consideration transferred to the holders of the Series C Preferred Stock and (2) the carrying amount of the Series C Preferred Stock. The Series D Exchange amount consists of the excess of (1) the fair value of all securities and other consideration transferred by the Company to the Series D Holders over (2) the fair value of securities issuable pursuant to the original conversion terms. See Note 3 to the condensed consolidated financial statements for further details.

The following weighted-average stock options to purchase shares of Common Stock were outstanding during each period presented, but were not included in the computation of diluted earnings (loss) per share because the number of shares assumed to be repurchased, as calculated was greater than the number of shares to be obtained upon exercise, therefore, the effect would be antidilutive (in thousands, except exercise prices):



	For the Nine Months Ended September 30,				For the Three Months Ended September 30,
	2011		2010		2011		2010
Number of stock options	547		280		705		285
Weighted average exercise price of stock options	$	11.53	$	22.00	$	8.07	$	21.66

The Company granted 0.4 million options to purchase shares of Common Stock at an exercise price of $0.51, the closing price on the date of issuance, March 15, 2011 and are included in the table above. The Company also granted 0.9 million shares of restricted Common Stock to its non-employee directors on August 9, 2011, approximately 0.2 million and 0.5 million of which were not included in the earnings per share as they were anti-dilutive for the nine and three months ended September 30, 2011, respectively.

The Company had 27,354 and 30,846 of additional nonvested shares outstanding as of September 30, 2011 and September 30, 2010, respectively which have original cliff vesting schedules ranging between five and ten years. The nonvested shares for each period were not included in the earnings per share because they were anti-dilutive.