Net Income Per Share

12 Months Ended

Dec. 31, 2019

Net Income Per Share

Basic earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per share includes the weighted average number of common shares outstanding and the number of equivalent shares which would be issued related to the stock options, unvested restricted stock, and warrants using the treasury method, unless such additional equivalent shares are anti-dilutive.

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



	Year Ended December 31,
	2019		2018		2017
Net income	$	37,125	$	24,559	$	18,581
Basic:
Weighted-average shares of common stock outstanding	31,344		32,415		33,016
Shares used in computing basic net income per share	31,344		32,415		33,016

Effect of dilutive securities:
Restricted stock subject to vesting	673		672		488
Shares issuable for acquisition consideration (1)	226		415		562
Shares used in computing diluted net income per share	32,243		33,502		34,066

Basic net income per share	$	1.18	$	0.76	$	0.56
Diluted net income per share	$	1.15	$	0.73	$	0.55

(1)

For the year ended December 31, 2019, this represents the shares held in escrow pursuant to: (i) the Asset Purchase Agreement with Zeon Solutions Incorporated and certain related entities (collectively, “Zeon”); (ii) the Asset Purchase Agreement with RAS & Associates, LLC (“RAS”); (iii) the Asset Purchase Agreement with Southport Services Group, LLC (“Southport”); (iv) the Asset Purchase Agreement with Stone Temple Consulting Corporation (“Stone Temple”); (v) the Agreement and Plan of Merger with Elixiter, Inc. (“Elixiter”); and (vi) the Asset Purchase Agreement with Sundog Interactive, Inc. (“Sundog”), as part of the consideration. For the year ended December 31, 2018, this represents the shares held in escrow pursuant to: (i) the Asset Purchase Agreement with BioPharm Systems, Inc. (“BioPharm”); (ii) the Asset Purchase Agreement with Zeon; (iii) the Asset Purchase Agreement with RAS; (iv) the Asset Purchase Agreement with Clarity Consulting, Inc. and Truth Labs, LLC (together, “Clarity”); (v) the Asset Purchase Agreement with Southport; (vi) the Asset Purchase Agreement with Stone Temple; and (vii) the Agreement and Plan of Merger with Elixiter, as part of the consideration. For the year ended December 31, 2017, this represents the shares held in escrow pursuant to: (i) the Asset Purchase Agreement with BioPharm; (ii) the Asset Purchase Agreement with Zeon; (iii) the Asset Purchase Agreement with The Pup Group, Inc. d/b/a Enlighten (“Enlighten”); (iv) the Asset Purchase Agreement with RAS; and (v) the Asset Purchase Agreement with Clarity, as part of the consideration.

The number of anti-dilutive securities not included in the calculation of diluted net income per share were as follows (in thousands):



	Year Ended December 31,
	2019	2018	2017
Restricted stock subject to vesting	26	31	88
Convertible senior notes	3,823	3,823	—
Warrants related to the issuance of convertible senior notes	3,823	3,823	—
Total anti-dilutive securities	7,672	7,677	88

See Note 12, Long-term Debt for further information on the convertible senior notes and warrants related to the issuance of convertible notes.

Prior to 2019, the Company’s Board of Directors authorized the repurchase of up to $235.0 million of Company common stock. On October 29, 2019, the Board of Directors authorized the expansion of the stock repurchase program by authorizing the repurchase of up to an additional $30.0 million of Company common stock for a total repurchase program of $265.0 million and extended the expiration date of the program from December 31, 2019 to June 30, 2021. The program could be suspended or discontinued at any time, based on market, economic, or business conditions. The timing and amount of repurchase transactions will be determined by management based on its evaluation of market conditions, share price, and other factors.

Since the program’s inception on August 11, 2008, the Company has repurchased approximately $220.0 million (15.4 million shares) of its outstanding common stock through December 31, 2019.