3. Equity

Non-controlling Interest

The Company holds an economic interest and is the sole managing member in Spark HoldCo, with NuDevco Retail and Retailco holding the remaining economic interest in Spark HoldCo. As a result, the Company has consolidated the financial position and results of operations of Spark HoldCo and reflected the economic interest retained by NuDevco Retail and Retailco as a non-controlling interest.

From January 1, 2015 through June 30, 2016, the Company and NuDevco Retail and Retailco owned the following economic interests in Spark HoldCo:



	The Company		NuDevco Retail and Retailco⁽¹⁾
From January 1, 2015 to May 3, 2015	21.82	%	78.18	%
From May 4, 2015 to December 30, 2015	22.37	%	77.63	%
From December 31, 2015 to February 2, 2016	22.49	%	77.51	%
From February 3, 2016 to March 31, 2016	29.70	%	70.30	%
From April 1, 2016 to May 3, 2016	42.14	%	57.86	%
From May 4, 2016 to May 17, 2016	42.46	%	57.54	%
From May 18, 2016 to May 24, 2016	42.64	%	57.36	%
From May 25, 2016 to June 7, 2016	42.66	%	57.34	%
From June 8, 2016 to June 30, 2016	46.23	%	53.77	%


(1)	In January 2016, Retailco succeeded to the interest of NuDevco Retail Holdings of its Class B common stock and an equal number of Spark HoldCo units it held pursuant to a series of transfers.

The Company's economic interests in Spark HoldCo increased on May 4, 2015, December 31, 2015, May 4, 2016, May 18, 2016 and May 25, 2016 due to the vesting of restricted stock units.

On May 4, 2015, 118,629 restricted stock units vested, with 97,193 shares of common stock distributed to the holders of these units and with 21,436 shares of common stock withheld by the Company to cover taxes owed on the vesting of such units. On December 31, 2015, 29,500 restricted stock units vested, with 21,430 shares of common stock distributed to the holders of these units and with 8,070 shares of common stock withheld by the Company to cover taxes owed on the vesting of such units.

On May 4, 2016, 101,210 restricted stock units vested, with 77,814 shares of common stock distributed to the holders of these units and with 23,396 shares of common stock withheld by the Company to cover taxes owed on the vesting of such units. On May 18, 2016, 53,853 restricted stock units vested, with 43,683 shares of common stock distributed to the holders of these units and with 10,170 shares of common stock withheld by the Company to cover taxes owed on the vesting of such units. On May 25, 2016, 5,000 restricted stock units vested, with 5,000 shares of common stock distributed to the holders of these units.

On February 3, 2016, April 1, 2016 and June 8, 2016, Retailco exchanged 1,000,000, 1,725,000 and 500,000, respectively, of its Spark HoldCo units (together with a corresponding number of shares of Class B common stock) for shares of Class A common stock at an exchange ratio of one share of Class A common stock for each Spark HoldCo unit (and corresponding share of Class B common stock) exchanged. Refer to Note 9 "Taxes" and Note 13 "Subsequent Events" for further discussion.

The following table summarizes the portions of net income and income tax expense (benefit) attributable to non-controlling interest (in thousands):



	Three Months Ended June 30,					Six Months Ended June 30,
	2016		2015			2016		2015

Net income allocated to non-controlling interest	$	8,521	$	3,500		$	20,529	$	14,046
Income tax expense (benefit) allocated to non-controlling interest	124		(378		)	565		(352		)
Net income attributable to non-controlling interest	$	8,397	$	3,878		$	19,964	$	14,398

Earnings Per Share

Basic earnings per share (“EPS”) is computed by dividing net income attributable to stockholders (the numerator) by the weighted-average number of Class A common shares outstanding for the period (the denominator). Class B common shares are not included in the calculation of basic earnings per share because they are not participating securities and have no economic interest in the Company. Diluted earnings per share is similarly calculated except that the denominator is increased (1) using the treasury stock method to determine the potential dilutive effect of the Company's outstanding unvested restricted stock units, (2) using the if-converted method to determine the potential dilutive effect of the Company's Class B common stock and (3) using the if-converted method to determine the potential dilutive effect of the outstanding convertible subordinated notes into the Company's Class B common stock.

The following table presents the computation of earnings per share for the three and six months ended June 30, 2016 and 2015 (in thousands, except per share data):



	Three Months Ended June 30,					Six Months Ended June 30,
	2016			2015		2016			2015
Net income attributable to stockholders of Class A common stock	$	2,341		$	161	$	6,514		$	2,570
Basic weighted average Class A common shares outstanding	6,043			3,062		4,899			3,031
Basic EPS attributable to stockholders	$	0.39		$	0.05	$	1.33		$	0.85

Net income attributable to stockholders of Class A common stock	$	2,341		$	161	$	6,514		$	2,570
Effect of conversion of Class B common stock to shares of Class A common stock, net of tax effect	—			—		11,837			8,496
Effect of conversion of convertible subordinated notes into shares of Class B common stock and shares of Class B common stock into shares of Class A common stock, net of tax effect	(332		)	—		(312		)	—
Diluted net income attributable to stockholders of Class A common stock	2,009			161		18,039			11,066
Basic weighted average Class A common shares outstanding	6,043			3,062		4,899			3,031
Effect of dilutive Class B common stock	—			—		9,006			10,750
Effect of dilutive convertible subordinated notes into shares of Class B common stock and shares of Class B common stock into shares of Class A common stock	493			—		493			—
Effect of dilutive restricted stock units	103			—		87			—
Diluted weighted average shares outstanding	6,639			3,062		14,485			13,781

Diluted EPS attributable to stockholders	$	0.30		$	0.05	$	1.25		$	0.80

The conversion of shares of Class B common stock to shares of Class A common stock was not recognized in dilutive earnings per share for the three months ended June 30, 2016 and 2015 as the effect of the conversion was antidilutive. The Company's unvested restricted stock units were not recognized in dilutive earnings per share for the three and six months ended June 30, 2015 as the effect of the conversion was antidilutive. The Company's convertible subordinated notes were not outstanding during the three and six months ended June 30, 2015.

Variable Interest Entity

On January 1, 2016, we adopted ASU No. 2015-02, Consolidation (Topic 810) (“ASU 2015-02”). ASU 2015-02 changed the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. Upon adoption, we continued to consolidate Spark HoldCo, but considered Spark HoldCo to be a variable interest entity requiring additional disclosures in the footnotes of our condensed consolidated financial statements.

Spark HoldCo is a variable interest entity due to its lack of rights to participate in significant financial and operating decisions and inability to dissolve or otherwise remove its management. Spark HoldCo owns all of the outstanding membership interests in each of the operating subsidiaries through which the Company operates. The Company is the sole managing member of Spark HoldCo, manages Spark HoldCo's operating subsidiaries through this managing membership interest, and is considered the primary beneficiary of Spark HoldCo.

The assets of Spark HoldCo cannot be used to settle the obligations of the Company except through distributions to the Company, and the liabilities of Spark HoldCo cannot be settled by the Company except through contributions to Spark HoldCo.

The following table includes the carrying amounts and classification of the assets and liabilities of Spark HoldCo that are included in the Company's condensed consolidated balance sheet as of June 30, 2016 (in thousands):



	June 30, 2016
Assets
Current assets:
Cash and cash equivalents	$	7,252
Accounts receivable	42,677
Intercompany receivable with Spark Energy, Inc.	36,774
Other current assets	32,389
Total current assets	119,092
Non-current assets:
Goodwill	18,379
Other assets	14,885
Total non-current assets	33,264
Total Assets	$	152,356

Liabilities
Current liabilities:
Accounts payable	$	22,257
Current portion of Senior Credit Facility	5,306
Other current liabilities	18,235
Total current liabilities	45,798
Long-term liabilities:
Long-term portion of Senior Credit Facility	11,939
Convertible subordinated notes to affiliates	6,502
Other long-term liabilities	458
Total long-term liabilities	18,899
Total Liabilities	$	64,697