Net Income Per Share

12 Months Ended

Dec. 31, 2013

6. NET INCOME PER SHARE

Predecessor Ambac common stock (and related stock options and restricted stock units) was cancelled upon emergence from bankruptcy on the Effective Date. As a result, the earnings per share information for Predecessor Ambac is not meaningful to investors in Successor Ambac’s common stock and warrants. Pursuant to the Reorganization Plan, 45,000,000 shares of new common stock at par value of $0.01 per share and 5,047,138 warrants were issued. Warrants entitle such holders to acquire up to 5,047,138 shares of new common stock at an exercise price of $16.67 per share at any time on or prior to April 30, 2023. For the eight months ended December 31, 2013, 6,312 warrants were exercised, resulting in an issuance of 2,524 shares of common stock. As of December 31, 2013, Successor Ambac had 5,040,826 warrants outstanding. Successor Ambac’s common stock and warrants began trading on NASDAQ under the symbols “AMBC” and “AMBCW,” respectively, on May 1, 2013.

The following table provides a reconciliation of the common shares used for basic earnings per share and diluted earnings per share:


	Successor Ambac		Predecessor Ambac
	Eight months ended December 31, 2013		Four months ended April 30, 2013		Year Ended December 31, 2012
Weighted average number of common shares used for basic earnings per share		45,003,925		302,469,544		302,468,867
Effect of potential dilutive shares:
Warrants		1,297,620		—		—
Restricted stock units		1,189		109,701		—
Stock options		—		—		—

Weighted average number of common shares and potential dilutive shares used for diluted earnings per share	$	46,302,734	$	302,579,245	$	302,468,867

Anti-dilutive shares excluded from the above reconciliation:
Warrants		—		—		—
Stock options		855		475,550		805,999
Restricted stock units		—		—		71,295

- Definition

The entire disclosure for earnings per share.

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