This excerpt taken from the WBMD 10-Q filed May 12, 2008.
Net (Loss) Income Per Common Share
Basic and diluted net (loss) income per common share are presented in conformity with Statement of Financial Accounting Standards (SFAS) No. 128, Earnings Per Share (SFAS 128). In accordance with SFAS No. 128, basic (loss) income per common share has been computed using the weighted-average number of shares of common stock outstanding during the periods presented. Diluted (loss) income per common share has been computed using the weighted-average number of shares of common stock outstanding during the periods, increased to give effect to potentially dilutive securities.
WEBMD HEALTH CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Included in basic and diluted shares for the three months ended March 31, 2008 and 2007 is the impact of shares to be issued pursuant to the purchase agreement for the acquisition of Subimo, LLC. The Company deferred the issuance of 640,930 shares of Class A common stock (Deferred Shares) until December 2008. Issuance of a portion of these shares may be further deferred until December 2010 subject to certain conditions. A maximum of 246,508 of the Deferred Shares may be used to settle any outstanding claims or warranties the Company may have against the seller. For purposes of calculating basic net income per share, the impact of 394,422 shares representing the non-contingent portion of the Deferred Shares was included. The additional Deferred Shares of 246,508 were considered if their effect was dilutive.
The Company has excluded certain outstanding stock options, restricted stock and Deferred Shares from the calculation of diluted (loss) income per common share during the periods in which such securities were anti-dilutive. The total number of shares that could potentially dilute income per common share in the future that were not included in the calculation of diluted (loss) income per common share was 5,736,129 and 1,318,413 for the three months ended March 31, 2008 and 2007, respectively.