11. BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE

Basic income (loss) per common share is calculated by dividing income (loss) attributable to common shareholders by the weighted average common shares outstanding during the period. Diluted income per common share adjusts basic income per common share for the effects of potentially dilutive common share equivalents.

As of September 30, 2013, potentially dilutive common shares include the dilutive effects of common shares issuable under the Management Compensation Plan, including stock options and restricted stock units (RSUs), using the treasury stock method, as well as Warrants.

The Company had dilutive common share equivalents during the three and nine months ended September 30, 2013, due to the results of operations being income from continuing operations, net of tax. For the three and nine months ended September 30, 2013, the following were dilutive and were included in the calculation of diluted loss per common share due to their dilutive effect:

Three months ended September 30, 2013

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0.2 million shares issuable upon exercise of stock options and RSUs under the Management Compensation Plan; and

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1.1 million shares issuable upon exercise of Warrants.

Nine months ended September 30, 2013

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0.2 million shares issuable upon exercise of stock options and RSUs under the Management Compensation Plan; and

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1.0 million shares issuable upon exercise of Warrants.

The Company had no dilutive common share equivalents during the three and nine months ended September 30, 2012, due to the results of operations being a loss from continuing operations, net of tax. For the three and nine months ended September 30, 2012, the following were potentially dilutive but were excluded from the calculation of diluted loss per common share due to their antidilutive effect:

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0.5 million shares issuable upon exercise of stock options and RSUs under the Management Compensation Plan;

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4.8 million shares issuable upon exercise of Warrants; and

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2.8 million shares issuable upon exercise of CVRs.

A calculation of basic income (loss) per common share to diluted income (loss) per common share is set forth below (in thousands, except per share amounts):


	Three Months Ended September 30, 2013			Three Months Ended September 30, 2012			Nine Months Ended September 30, 2013			Nine Months Ended September 30, 2012
	Three Months Ended September 30, 2013			Three Months Ended September 30, 2012			Nine Months Ended September 30, 2013			Nine Months Ended September 30, 2012
Income (loss) from continuing operations, net of tax	$	1,389		$	(909	)	$	2,289		$	(21,395	)
Income (loss) from discontinued operations, net of tax		(23,744	)		(24,128	)		(25,543	)		(40,307	)
Gain (loss) from sale of discontinued operations, net of tax		15,650			—			150,695			98,666

Net income (loss) attributable to Primus Telecommunications Group, Incorporated-basic	$	(6,705	)	$	(25,037	)	$	127,441		$	36,964

Net income (loss) attributable to Primus Telecommunications Group, Incorporated-diluted	$	(6,705	)	$	(25,037	)	$	127,441		$	36,964

Weighted average common shares outstanding-basic		14,077			13,890			13,987			13,825

Weighted average common shares outstanding-diluted		15,297			13,890			15,124			13,825

Basic income (loss) per common share:
Income (loss) from continuing operations attributable to Primus Telecommunications Group, Incorporated		0.10			(0.07	)		0.17			(1.54	)
Income (loss) from discontinued operations		(1.69	)		(1.74	)		(1.83	)		(2.92	)
Gain (loss) from sale of discontinued operations		1.11			—			10.77			7.14

Net income (loss) attributable to Primus Telecommunications Group, Incorporated		(0.48	)		(1.81	)		9.11			2.68

Diluted income (loss) per common share:
Income (loss) from continuing operations attributable to Primus Telecommunications Group, Incorporated		0.09			(0.07	)		0.16			(1.54	)
Income (loss) from discontinued operations		(1.55	)		(1.74	)		(1.69	)		(2.92	)
Gain (loss) from sale of discontinued operations		1.02			—			9.96			7.14

Net income (loss) attributable to Primus Telecommunications Group, Incorporated		(0.44	)		(1.81	)		8.43			2.68