Three Months Ended March 31	2013		2012
Basic EPS:
Net income attributable to Ocwen common stockholders	$	42,576	$	19,349

Weighted average shares of common stock		135,638,567		130,649,595

Basic EPS	$	0.31	$	0.15

Diluted EPS:
Net income attributable to Ocwen common stockholders	$	42,576	$	19,349
Preferred stock dividends (1)		—		—
Interest expense on Convertible Notes, net of income tax (2)		—		99
Adjusted net income attributable to Ocwen	$	42,576	$	19,448

Weighted average shares of common stock		135,638,567		130,649,595
Effect of dilutive elements:
Preferred Shares (1)		—		—
Convertible Notes (2)		—		4,057,736
Stock options		3,902,390		3,337,571
Common stock awards		18,200		1,368
Dilutive weighted average shares of common stock		139,559,157		138,046,270

Diluted EPS	$	0.31	$	0.14

Stock options excluded from the computation of diluted EPS:
Anti-dilutive(3)		—		151,250
Market-based(4)		1,535,000		558,750

(1)

The effect of our Preferred Shares on diluted EPS is computed using the if-converted method. We assumed no conversion to common shares for the first quarter of 2013 because the effect was anti-dilutive.

(2)

Prior to the redemption of the 3.25% Convertible Notes in March 2012, we also computed their effect on diluted EPS using the if-converted method. Interest expense and related amortization costs applicable to the Convertible Notes, net of income tax, were added back to net income. We issued 4,635,159 shares of common stock upon conversion of $56.4 million of the Convertible Notes.

(3)

These stock options were anti-dilutive because their exercise price was greater than the average market price of our stock.

(4)

Shares that are issuable upon the achievement of certain performance criteria related to OCN’s stock price and an annualized rate of return to investors.