Earnings Per Share

The Company calculates its basic and diluted earnings per share in accordance with US GAAP. Basic earnings per share is calculated by dividing net income attributable to the Company's common stockholders by the weighted average number of common shares outstanding for the period. As of September 30, 2019, there were 29,013,137 shares of Class A common stock outstanding. As of September 30, 2019, the Company has included 216,912 fully vested, unissued restricted stock units in its calculation of basic earnings per share. As of December 31, 2018, there were 28,437,860 shares of Class A common stock outstanding. As of December 31, 2018, the Company has included 253,772 fully vested, unissued restricted stock units in its calculation of basic earnings per share.

Diluted earnings per common share are calculated by adjusting the weighted average outstanding shares to assume conversion of all potentially dilutive items. The Company uses the treasury stock method to reflect the potential dilutive effect of the unvested restricted shares, restricted stock units, and SAR's. In calculating the number of dilutive shares outstanding, the shares of common stock underlying unvested restricted shares and restricted stock units are assumed to have been delivered, and options and warrants are assumed to have been exercised, for the entire period being presented. The number of performance-linked unvested restricted stock units that are included in the calculation are at the amount that could be earned using current payout rates. The assumed proceeds from the assumed vesting, delivery and exercising were calculated as the amount of compensation cost attributed to future services and not yet recognized.

The Company can elect to settle the Series A Convertible Preferred Stock in shares, cash, or a combination of both. The Company's intent is to settle in cash and, based on current and projected liquidity needs, the Company has the ability to do so.

The computation of earnings per share is as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
	(dollars in thousands, except share and per share data)
Net income (loss)	$	6,583	$	19,598	$	26,596	$	75,538
Net income (loss) attributable to non-controlling interests in consolidated subsidiaries and investment funds	2,770		4,110		7,188		37,798
Net income (loss) attributable to Cowen Inc.	3,813		15,488		19,408		37,740
Preferred stock dividends	1,698		1,698		5,094		5,094
Net income (loss) attributable to Cowen Inc. common stockholders	$	2,115	$	13,790	$	14,314	$	32,646

Shares for basic and diluted calculations:
Weighted average shares used in basic computation	29,529		29,610		29,687		29,662
Restricted stock	1,735		1,234		1,694		951
Weighted average shares used in diluted computation	31,264		30,844		31,381		30,613
Earnings (loss) per share:
Basic	$	0.07	$	0.47	$	0.48	$	1.10
Diluted	$	0.07	$	0.45	$	0.46	$	1.07