The following table presents the calculation of basic and diluted net income per share (in thousands, except per share information):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2014		2013		2014		2013
Net income	$	7,306	$	7,234	$	16,738	$	15,919
Basic:
Weighted-average shares of common stock outstanding		32,118		30,141		31,470		30,287
Shares used in computing basic net income per share		32,118		30,141		31,470		30,287
Effect of dilutive securities:
Stock options		8		154		78		156
Restricted stock subject to vesting		528		773		571		634
Contingently issuable shares (1)		14		-		17		-
Shares issuable for acquisition consideration (2)		661		740		940		615
Shares used in computing diluted net income per share		33,329		31,808		33,076		31,692

Basic net income per share	$	0.23	$	0.24	$	0.53	$	0.53
Diluted net income per share	$	0.22	$	0.23	$	0.51	$	0.50

Anti-dilutive options and restricted stock not included in the calculation of diluted net income per share		-		-		97		1

(1)	For the three and nine months ended September 30, 2014, this represents the Company's estimate of shares to be issued to Clear Task, Inc. ("Clear Task") pursuant to the Asset Purchase Agreement. Refer to Note 7 for further discussion.

(2)

For the three and nine months ended September 30, 2014, this represents the shares held in escrow pursuant to: (i) the Agreement and Plan of Merger with Northridge Systems, Inc. ("Northridge"); (ii) the Agreement and Plan of Merger with TriTek Solutions, Inc. ("TriTek"); (iii) the Asset Purchase Agreement with Clear Task; (iv) the Asset Purchase Agreement with CoreMatrix Systems, LLC ("CoreMatrix"); (v) the Agreement and Plan of Merger with ForwardThink Group Inc. ("ForwardThink"); (vi) the Asset Purchase Agreement with BioPharm Systems, Inc.; and (vii) the Asset Purchase Agreement with Trifecta Technologies, Inc. and Trifecta Technologies Canada, Limited as part of the consideration. For the three and nine months ended September 30, 2013, this represents the shares held in escrow pursuant to: (i) the Agreement and Plan of Merger with Northridge; (ii) the Asset Purchase Agreement with Nascent Systems, LP; (iii) the Agreement and Plan of Merger with TriTek; and (iv) the Asset Purchase Agreement with Clear Task as part of the consideration.