4.	Basic and Diluted Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted average number of common and dilutive common equivalent shares outstanding during the period. The number of dilutive common equivalent shares outstanding during the period was determined in accordance with the treasury-stock method. Common equivalent shares consisted of common stock issuable upon the exercise of outstanding options and common stock issuable upon the vesting of outstanding, unvested SUAs. Basic and diluted weighted average common shares outstanding for the

three

months and

nine

months ended

September 30, 2018

and

2017

were as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Weighted average common shares outstanding, basic		5,507		5,491		5,500		5,476
Dilutive common equivalent shares		48		73		52		64
Weighted average common shares outstanding, diluted		5,555		5,564		5,552		5,540

The computation of diluted earnings per share for the

three

and

nine

month periods ended

September 30, 2018

excludes the effect of the potential exercise of stock awards, including stock options, when the average market price of the common stock is lower than the exercise price of the related options during the period. These stock awards are

not

included in the computation of diluted income per share because the effect would be antidilutive. For the

three

and

nine

month periods ended

September 30, 2018,

the number of antidilutive stock awards excluded from the diluted earnings per share was

127

thousand and

thousand, respectively.