Earnings Per Share

9 Months Ended

Sep. 30, 2017

COMMON STOCK AND EARNINGS PER SHARE

Earnings per Share

The calculation of basic and diluted earnings per common share are as follows (in thousands, except per share amounts):



	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2017			2016		2017			2016
Numerator:
Earnings (loss) from continuing operations - diluted	$	(28,229	)	$	2,116	$	(72,351	)	$	21,815

Denominator:
Weighted-average shares outstanding - basic	58,733			59,379		58,965			62,084
Common equivalent shares:
Effect of stock-based compensation awards	—			904		—			1,940
Weighted-average shares outstanding assuming dilution	58,733			60,283		58,965			64,024

Basic earnings (loss) per share from continuing operations	$	(0.48	)	$	0.04	$	(1.23	)	$	0.35
Diluted earnings (loss) per share from continuing operations	$	(0.48	)	$	0.04	$	(1.23	)	$	0.34

The determination of diluted earnings per share requires the exclusion of the fair value re-measurement of the stock warrants recorded as a liability (see Note B), if such warrants have an anti-dilutive effect on earnings per share. For periods in which equivalent shares have a dilutive effect on earnings per share, the weighted-average diluted shares outstanding is calculated using the treasury method. Under this method, the number of diluted shares is determined by dividing the assumed proceeds of the warrants recorded as a liability by the average stock price during the period and comparing that amount with the number of corresponding warrants outstanding.

The underlying warrants as of September 30, 2017 and 2016, could have resulted in 14.9 million and 9.8 million additional shares of the Company's common stock, respectively, if the warrants recorded as a liability were settled by tendering cash. The warrants recorded in stockholders' equity as of September 30, 2017 and 2016, could have resulted in 8.1 million and zero additional shares of the Company's common stock, respectively, if the Company's stock price exceeded $41.35 and the warrants were settled in shares.

Purchase of Common Stock

The Company's Board of Directors has authorized management to repurchase outstanding common stock of the Company from time to time on the open market or in privately negotiated transactions. The authorization does not require the Company to repurchase a specific number of shares and the Company may terminate the repurchase program at any time. Upon the retirement of common stock repurchased, the excess purchase price over the par value for retired shares of common stock is recorded to additional paid-in-capital.

The Company repurchased common stock during the first six months of 2017, including 380,637 shares on June 6, 2017 from an underwriter in conjunction with an underwritten secondary offering by its largest shareholder, Red Mountain Partners, L.P., a fund that is affiliated with Red Mountain Capital Partners, LLC (“Red Mountain”), a related party, for an aggregate purchase price of $8.5 million. The share price of $22.42 was equal to the price per share paid by the underwriter to Red Mountain.