Per Share Amounts and Common Shares Outstanding

We calculate our basic earnings per share by dividing net income or net loss by the weighted average number of common shares outstanding during the period. Diluted earnings per share are calculated in a similar manner, but include the effect of dilutive securities. To the extent these securities are antidilutive, they are excluded from the calculation of earnings per share. The per share amounts were computed as follows:


K.	Per Share Amounts and Common Shares Outstanding (continued)



	Three Months Ended				Six Months Ended
	July 4, 2015		June 28, 2014		July 4, 2015		June 28, 2014
Income available to common shareholders:
Net income	$	15,932	$	14,046	$	12,404	$	10,035

Weighted-average shares:
Basic:
Outstanding	13,099		13,360		13,146		13,419
Partially-paid share subscriptions	115		126		229		252
Basic weighted-average shares	13,214		13,486		13,375		13,671

Diluted:
Basic from above	13,214		13,486		13,375		13,671
Incremental shares from assumed:
Exercise of stock subscription purchase rights	61		44		62		44
Exercise of stock options and awards	390		350		398		355
Diluted weighted-average shares	13,665		13,880		13,835		14,070

Net income per share:
Basic	$	1.21	$	1.04	$	.93	$	.73

Diluted	$	1.17	$	1.01	$	.90	$	.71

Common Shares Outstanding--A summary of the activity of the common shares outstanding for the six months ended July 4, 2015 follows:



Shares outstanding at January 1, 2015	13,164,933
Shares purchased	(386,138	)
Shares sold	197,749
Stock subscription offering -- cash purchases	18,774
Options and awards exercised	41,832
	(127,783	)
Shares outstanding at July 4, 2015	13,037,150


K.	Per Share Amounts and Common Shares Outstanding (continued)

On May 19, 2015, at the Annual Meeting of Shareholders, the Company's shareholders approved an increase in the number of the Company's authorized common shares, par value $1.00, to 48 million from 24 million. The number of authorized preferred shares of the Company remains at 4 million preferred shares, no par value, of which none were issued.

On July 4, 2015, we had 13,037,150 common shares outstanding, employee and director options exercisable to purchase 406,284 common shares, partially-paid subscriptions for 459,830 common shares and purchase rights outstanding for 184,239 common shares.

Stock Subscription Offering--Beginning May 2012, the Company offered to eligible employees and nonemployee directors the right to subscribe to common shares of the Company at $19.70 per share in accordance with the provisions of The Davey Tree Expert Company 2004 Omnibus Stock Plan and the rules of the Compensation Committee of the Company's Board of Directors (collectively, the "plan"). The offering period ended on August 1, 2012 and resulted in the subscription of 637,714 common shares for $12,563 at $19.70 per share.

Under the plan, a participant in the offering purchasing common shares for an aggregate purchase price of less than $5 had to pay with cash. All participants (excluding Company directors and officers) purchasing $5 or more of the common shares had an option to finance their purchase through a down-payment of at least 10% of the total purchase price and a seven-year promissory note for the balance due with interest at 2%. Payments on the promissory note can be made either by payroll deductions or annual lump-sum payments of both principal and interest.

Common shares purchased under the plan have been pledged as security for the payment of the promissory note and the common shares will not be issued until the promissory note is paid-in-full. Dividends will be paid on all subscribed shares, subject to forfeiture to the extent that payment is not ultimately made for the shares.

All participants in the offering purchasing in excess of $5 of common shares were granted a "right" to purchase one additional common share at a price of $19.70 per share for every three common shares purchased under the plan. As a result of the stock subscription, employees were granted rights to purchase 211,800 common shares. Each right may be exercised at the rate of one-seventh per year and will expire seven years after the date that the right was granted. Employees may not exercise a right should they cease to be employed by the Company.