Note 11 – Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share attributable to Vishay stockholders (shares in thousands):

	Fiscal quarters ended				Nine fiscal months ended
	September 27, 2014		September 28, 2013		September 27, 2014		September 28, 2013

Numerator:
Numerator for basic earnings per share:
Net earnings	$	26,971	$	32,719	$	88,423	$	92,959

Adjustment to the numerator for continuing operations and net earnings:
Interest savings assuming conversion of dilutive convertible and exchangeable notes, net of tax		14		33		44		124

Numerator for diluted earnings per share:
Net earnings	$	26,985	$	32,752	$	88,467	$	93,083

Denominator:
Denominator for basic earnings per share:
Weighted average shares		147,451		144,937		147,447		144,012
Outstanding phantom stock units		118		107		118		107
Adjusted weighted average shares		147,569		145,044		147,565		144,119

Effect of dilutive securities:
Convertible and exchangeable debt instruments		7,702		6,560		6,332		7,045
Restricted stock units		267		279		237		301
Other		8		7		8		6
Dilutive potential common shares		7,977		6,846		6,577		7,352

Denominator for diluted earnings per share:
Adjusted weighted average shares		155,546		151,890		154,142		151,471

Basic earnings per share attributable to Vishay stockholders	$	0.18	$	0.23	$	0.60	$	0.65

Diluted earnings per share attributable to Vishay stockholders	$	0.17	$	0.22	$	0.57	$	0.61

Diluted earnings per share for the periods presented do not reflect the following weighted average potential common shares that would have an antidilutive effect or have unsatisfied performance conditions (in thousands):

	Fiscal quarters ended				Nine fiscal months ended
	September 27, 2014		September 28, 2013		September 27, 2014		September 28, 2013
Convertible and exchangeable notes:
Convertible Senior Debentures, due 2040		-		19,809		-		19,809
Convertible Senior Debentures, due 2041		7,925		7,885		7,927		7,885
Weighted average employee stock options		77		77		77		87
Weighted average other		154		285		143		370

In periods in which they are dilutive, if the potential common shares related to the exchangeable notes are included in the computation, the related interest savings, net of tax, assuming conversion/exchange is added to the net earnings used to compute earnings per share.

The Company's convertible debt instruments are only convertible upon the occurrence of certain events. The convertible debentures due 2042 are convertible subsequent to the September 27, 2014 evaluation of the conversion criteria. In periods that the debentures are not convertible, the certain conditions which could trigger conversion of the remaining debentures have been deemed to be non-substantive, and accordingly, the Company has always assumed the conversion of these instruments in its diluted earnings per share computation during periods in which they are dilutive.

At the direction of its Board of Directors, the Company intends, upon conversion, to repay the principal amounts of the convertible senior debentures, due 2040, due 2041, and due 2042, in cash and settle any additional amounts in shares of Vishay common stock. Accordingly, the debentures are included in the diluted earnings per share computation using the "treasury stock method" (similar to options and warrants) rather than the "if converted method" otherwise required for convertible debt. Under the "treasury stock method," Vishay calculates the number of shares issuable under the terms of the debentures based on the average market price of Vishay common stock during the period, and that number is included in the total diluted shares figure for the period. If the average market price is less than $13.72, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2040, if the average market price is less than $18.80, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2041, and if the average market price is less than $11.67, no shares are included in the diluted earnings per share computation for the convertible senior debentures due 2042.