Income Per Share

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Income Per Share

3. INCOME PER SHARE:

The weighted average number of common shares outstanding is calculated as follows (in thousands):

	Three Months Ended March 31,
	2015		2014
Weighted average shares outstanding - basic		51,123		50,623
Effect of dilutive stock-based compensation		398		573
Effect of convertible notes		—		7,152
Effect of common stock warrants		—		5,725
Weighted average shares outstanding - diluted		51,521		64,073

As discussed more fully in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, in 2009 the Company issued 3.75% Convertible Senior Notes due 2014 (the “Convertible Notes”). The Company settled the outstanding face value of the Convertible Notes in cash at maturity on October 1, 2014. The conversion spread associated with the conversion of the Convertible Notes was settled in shares of the Company’s common stock. Pursuant to a purchased call option, or note hedge, the Company also received and cancelled an equal number of shares of its common stock at maturity.

In connection with the issuance of the Convertible Notes, the Company sold common stock purchase warrants to counterparties affiliated with the initial purchasers of the Convertible Notes whereby the warrant holders could purchase shares of the Company’s stock. At separate times during 2014, the Company modified the agreements with each of the counterparties to cash settle the warrants as described in Note 7. As a result of these modifications, the warrants were settled in cash during 2014 and the first quarter of 2015, and did not affect the calculation of diluted earnings per share for the three months ended March 31, 2015.