10. EARNINGS PER SHARE

Basic earnings per share, or EPS, is calculated by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted EPS is computed by dividing net income on an if-converted basis for 2013 and the first quarter of 2014, with respect to the 3.25% Notes and the 5.75% Notes, by the weighted average number of common shares outstanding during the period, adjusted for the dilutive effect of any outstanding dilutive securities. All of the 5.75% Notes were retired during the first quarter of 2014. During the second quarter of 2014, the Company received shareholder approval to allow for flexible settlement in cash, shares of common stock, or a combination of cash and shares of common stock for the conversion of the 3.25% Notes. The Company intends to settle conversions in cash for the principal amount and cash or shares of the Company’s common stock for any related conversion premium. Accordingly, beginning in the second quarter of 2014, diluted EPS is computed using the treasury stock method by dividing net income by the weighted average number of common shares outstanding during the period, adjusted for the dilutive effect of any outstanding dilutive securities. The calculations of basic and diluted EPS are as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2014		2013		2014		2013
Basic EPS:
Net income	$	32,314	$	5,965	$	75,517	$	8,520
Weighted average shares outstanding - basic		37,467		30,160		35,322		30,047
EPS - basic	$	0.86	$	0.20	$	2.14	$	0.28

Diluted EPS:
Net income	$	32,314	$	5,965	$	75,517	$	8,520
Interest and amortization on convertible debt, net of tax effect:
5.75% Notes		-		904		576		-
3.25% Notes		-		-		1,379		-
Net income - diluted	$	32,314	$	6,869	$	77,472	$	8,520

Weighted average shares outstanding - basic		37,467		30,160		35,322		30,047
Effect of dilutive convertible debt:
5.75% Notes		-		6,280		2,029		-
3.25% Notes		1,675		-		3,716		-
Effect of dilutive stock-based compensation awards		217		364		241		320
Weighted average shares outstanding - diluted		39,359		36,804		41,308		30,367

EPS - diluted	$	0.82	$	0.19	$	1.88	$	0.28

Excluded from the computations of diluted EPS for the three and six months ended June 30, 2013 were stock-based compensation awards totaling 0.1 million and 0.3 million shares, respectively, because the exercise prices or the grant-date fair value, as applicable, of the corresponding awards were greater than the average market price of the Company’s common stock during the respective periods. Also, for the six months ended June 30, 2013, 6.3 million shares related to the effect of the 5.75% Notes were excluded from the computation of diluted EPS as the inclusion of these shares would have been antidilutive.