(5)

Earnings Per Share

Earnings per common share attributable to Landstar System, Inc. and subsidiary are based on the weighted average number of shares outstanding, including outstanding non-vested restricted stock and outstanding Deferred Stock Units. Diluted earnings per share attributable to Landstar System, Inc. and subsidiary are based on the weighted average number of common shares and Deferred Stock Units outstanding plus the incremental shares that would have been outstanding upon the assumed exercise of all dilutive stock options.

The following table provides a reconciliation of the average number of common shares outstanding used to calculate earnings per common share attributable to Landstar System, Inc. and subsidiary to the average number of common shares and common share equivalents outstanding used to calculate diluted earnings per share attributable to Landstar System, Inc. and subsidiary (in thousands):


	Twenty Six Weeks Ended				Thirteen Weeks Ended
	June 30, 2018		July 1, 2017		June 30, 2018		July 1, 2017
Average number of common shares outstanding		41,744		41,907		41,450		41,935
Incremental shares from assumed exercises of stock options		51		97		41		75

Average number of common shares and common share equivalents outstanding		41,795		42,004		41,491		42,010

For each of the twenty-six-week periods ended June 30, 2018 and July 1, 2017, no options outstanding to purchase shares of common stock were antidilutive. Outstanding RSUs were excluded from the calculation of diluted earnings per share attributable to Landstar System, Inc. and subsidiary for all periods because the performance metric requirements or market condition for vesting had not been satisfied.