COMPUTATION OF EARNINGS PER SHARE

The computation of basic earnings per share is based on net earnings divided by the weighted average number of shares of common stock outstanding for each period. The computation of diluted earnings per share reflects the common stock equivalency of dilutive options granted to employees under the Company's stock incentive plan and shares issuable on redemption of its Convertible Notes.



	For the Three Months Ended					For the Nine Months Ended
	September 26, 2014			September 27, 2013		September 26, 2014		September 27, 2013
In thousands, except per share amounts
Earnings from continuing operations	$	14,873		$	18,695	$	42,524	$	43,741
Earnings from discontinued operations, net of tax	(94		)	64		285		64
Gain on disposal of discontinued operations, net of tax	—			420		—		420
Net earnings	$	14,779		$	19,179	$	42,809	$	44,225

Basic:
Weighted average number of shares outstanding	27,113			26,770		27,025		26,721

Earnings per share from continuing operations	$	0.55		$	0.70	$	1.57	$	1.64
Earnings per share from discontinued operations	—			—		0.01		—
Earnings per share from disposal of discontinued operations	—			0.02		—		0.02
Basic earnings per share	$	0.55		$	0.72	$	1.58	$	1.66
Diluted:
Weighted average number of shares outstanding	27,113			26,770		27,025		26,721
Weighted average shares issuable on exercise of dilutive stock options	142			164		152		156
Weighted average shares issuable on redemption of convertible notes	607			299		589		185
Total	27,862			27,233		27,766		27,062

Earnings per share from continuing operations	$	0.53		$	0.68	$	1.53	$	1.61
Earnings per share from discontinued operations	—			—		0.01		—
Earnings per share from disposal of discontinued operations	—			0.02		—		0.02
Diluted earnings per share	$	0.53		$	0.70	$	1.54	$	1.63

Equity awards

For the three and nine months ended September 26, 2014, respectively, 310,192 and 356,841 shares issuable under equity awards granted to employees were excluded from the calculation of diluted earnings per share as they were anti-dilutive based on the average stock price during the period. For the three and nine months ended September 27, 2013, respectively, 405,505 and 429,541 shares issuable under equity awards granted to employees were excluded from the calculation of diluted earnings per share as they were anti-dilutive based on the average stock price during the period.

Convertible Notes

In November 2010, the Company issued Convertible Notes due on November 15, 2017, in the aggregate principal amount of $115.0 million. The Convertible Notes will mature on November 15, 2017, unless earlier redeemed, repurchased by the Company or converted. Upon conversion, the Convertible Notes require net share settlement, where the aggregate principal amount of the notes will be paid in cash and remaining amounts due, if any, will be settled in cash, shares of the Company's common stock or a combination of cash and shares of common stock, at the Company's election.

12. COMPUTATION OF EARNINGS PER SHARE (CONTINUED)

For the three-month and nine-month periods ended September 26, 2014, and September 27, 2013, shares issuable under the Convertible Notes that were dilutive during the period were included in the calculation of earnings per share as the conversion price for the Convertible Notes was less than the average share price of the Company's stock.

Warrants

Excluded from the diluted earnings per share calculation for the three months and nine months ended September 26, 2014, are 3,412,339 and 3,410,690, respectively, shares issuable under the warrants sold in connection with the Company’s convertible note offering as they would be anti-dilutive. For the three and nine months ended September 27, 2013, respectively, 3,405,585 and 3,403,710, shares issuable under the warrants sold in connection with the Company’s convertible note offering were excluded from the diluted earnings per share calculation as they would be anti-dilutive.