Note 10 — Earnings Per Share

We have shares of restricted stock issued and outstanding, which remain subject to vesting requirements. Holders of such shares of unvested restricted stock are entitled to the same liquidation and dividend rights as the holders of our outstanding common stock and are thus considered participating securities. Under applicable accounting guidance, the undistributed earnings for each period are allocated based on the participation rights of both the common shareholders and holders of any participating securities as if earnings for the respective periods had been distributed. Because both the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis. Further, we are required to compute earnings per share (“EPS”) amounts under the two class method in periods in which we have earnings from continuing operations. For periods in which we have a net loss we do not use the two class method as holders of our restricted shares are not contractually obligated to share in such losses.

The presentation of basic EPS amounts on the face of the accompanying condensed consolidated statements of operations is computed by dividing the net income applicable to Helix common shareholders by the weighted average shares of outstanding common stock. The calculation of diluted EPS is similar to basic EPS, except that the denominator includes dilutive common stock equivalents and the income included in the numerator excludes the effects of the impact of dilutive common stock equivalents, if any. The computations of the numerator (Income) and denominator (Shares) to derive the basic and diluted EPS amounts presented on the face of the accompanying condensed consolidated statements of operations are as follows (in thousands):


		Three Months Ended			Three Months Ended
		September 30, 2013			September 30, 2012
		Income	Shares		Income	Shares
Basic:
Continuing operations:
Net income applicable to Helix	$	44,593		$	14,865
Less: Income from discontinued operations, net of tax		(44)			(4,503)
Income from continuing operations		44,549			10,362
Less: Undistributed income allocable to participating securities – continuing operations		(337)			(104)
Income applicable to common shareholders – continuing operations	$	44,212	105,029	$	10,258	104,256


Discontinued operations:
Income from discontinued operations, net of tax	$	44		$	4,503
Less: Undistributed income allocable to participating securities – discontinued operations		-			(45)
Income applicable to common shareholders – discontinued operations	$	44	105,029	$	4,458	104,256


		Three Months Ended			Three Months Ended
		September 30, 2013			September 30, 2012
		Income	Shares		Income	Shares
Diluted:
Continuing operations:
Income applicable to common shareholders – continuing operations	$	44,212	105,029	$	10,258	104,256
Effect of dilutive securities:
Share-based awards other than participating securities		-	107		-	112
Convertible preferred stock		-	-		10	361
Income applicable to common shareholders – continuing operations	$	44,212	105,136	$	10,268	104,729

Discontinued operations:
Income from discontinued operations, net of tax	$	44	105,136	$	4,503	104,729


		Nine Months Ended			Nine Months Ended
		September 30, 2013			September 30, 2012
		Income	Shares		Income	Shares
Basic:
Continuing operations:
Net income applicable to Helix	$	73,419		$	125,233
Less: Income from discontinued operations, net of tax		(1,073)			(95,572)
Income from continuing operations		72,346			29,661
Less: Undistributed income allocable to participating securities – continuing operations		(525)			(299)
Income applicable to common shareholders – continuing operations	$	71,821	105,036	$	29,362	104,450


Discontinued operations:
Income from discontinued operations, net of tax	$	1,073		$	95,572
Less: Undistributed income allocable to participating securities – discontinued operations		(8)			(962)
Income applicable to common shareholders – discontinued operations	$	1,065	105,036	$	94,610	104,450


		Nine Months Ended			Nine Months Ended
		September 30, 2013			September 30, 2012
		Income	Shares		Income	Shares
Diluted:
Continuing operations:
Income applicable to common shareholders – continuing operations	$	71,821	105,036	$	29,362	104,450
Effect of dilutive securities:
Share-based awards other than participating securities		-	116		-	86
Undistributed income reallocated to participating securities		-	-		2	-
Convertible preferred stock		-	-		30	361
Income applicable to common shareholders – continuing operations	$	71,821	105,152	$	29,394	104,897

Discontinued operations:
Income from discontinued operations, net of tax	$	1,073	105,152	$	95,572	104,897

No diluted shares were included for the 2032 Notes for the three- and nine-month periods ended September 30, 2013 and 2012 as the conversion trigger of $32.53 per share was not met, and because we have the right to settle any such future conversions in cash at our sole discretion (Note 7). No diluted shares were included for the 2025 Notes for the three- and nine-month periods ended September 30, 2012 as the conversion trigger of $38.57 per share was not met.