NET INCOME PER COMMON SHARE

12 Months Ended

Dec. 31, 2016

19.	NET INCOME PER COMMON SHARE:

The Company computes earnings per share in accordance with ASC Topic 260, Earnings per Share ("ASC 260"), which requires earnings per share for each class of stock to be calculated using the two-class method. The two-class method is an allocation of income between the holders of common stock and the Company's participating security holders. Under the two-class method, income for the reporting period is allocated between common shareholders and other security holders based on their respective participation rights in undistributed income. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and, therefore, are included in computing earnings per share pursuant to the two-class method.

Basic net income per common share is computed by dividing net income allocated to common shareholders by the weighted-average number of shares of common stock outstanding for the period excluding unvested restricted stock units and performance units. Net income allocated to the holders of the Company's unvested restricted stock awards is calculated based on the shareholders proportionate share of weighted average shares of common stock outstanding on an if-converted basis.

For purposes of determining diluted net income per common share, basic net income per share is further adjusted to include the effect of potential dilutive common shares outstanding, including stock options, restricted stock units and performance units, and the impact of shares to be issued under the ESPP.

The following table is a reconciliation of net income and the shares used in calculating basic and diluted net income per common share for the year ended December 31, 2016, 2015, and 2014 (in thousands, except share and per share data):

	Year Ended December 31,
	2016			2015			2014
Numerator:
Net income	$	48,070			14,678			41,854
Adjustment for basic EPS:
Earnings allocated to unvested securities	$	(734	)		(138	)		(57	)
Adjusted net income	$	47,336			14,540			41,797
Denominator:
Weighted average common shares outstanding – Basic		46,408,460			46,816,394			46,252,960
Effect of dilutive shares:
Common stock equivalents arising from stock options and ESPP		5,398			267,145			265,129
Restricted stock awards and units and performance units		122,122			410,649			167,056
Weighted average common shares outstanding – Diluted		46,535,980			47,494,188			46,685,145
Net income per common share:
Basic	$	1.02		$	0.31		$	0.90
Diluted	$	1.02		$	0.31		$	0.90

For the year ended December 31, 2016, 2015, and 2014, the combined effects of unvested restricted stock awards, restricted stock units, performance unit awards and stock options of 2,981, 17,055 and 87,894, respectively, were excluded from the calculation of diluted EPS as their impact would have been antidilutive.