EARNINGS PER SHARE (EPS)

3 Months Ended

Dec. 31, 2016

Basic EPS (and diluted EPS in periods when a loss exists) was calculated by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted EPS was calculated by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding plus additional common shares that could be issued in connection with stock based compensation and upon the settlement of the 2017 convertible notes.

The following table is a reconciliation of the share amounts (in thousands) used in computing earnings per share:



	Three Months Ended December 31,
	2016	2015
Weighted average shares outstanding - basic	39,336	41,968
Incremental shares from stock based compensation	1,922	2,195
Convertible debt due 2017	1,054	1,221

Weighted average shares outstanding - diluted	42,312	45,384

Anti-dilutive options excluded from diluted EPS computation	—	419

As of December 31, 2016, Griffon had the intent and ability to settle the principal amount of the 2017 Notes in cash, and as such, the potential issuance of shares related to the principal amount of the 2017 Notes does not affect diluted shares. On July 14, 2016, Griffon announced that it would settle, upon conversion, up to $125,000 of the conversion value of the 2017 Notes in cash, with amounts in excess of $125,000, if any, to be settled in shares of Griffon common stock. Subsequent to December 31, 2016, Griffon settled the convertible debt for $173,855, which consisted of $125,000 in cash and 1,954,993 shares of common stock.