Build-A-Bear Workshop 2012 Annual Report Download - page 65

BUILD-A-BEAR WORKSHOP, INC. 2012 FORM 10-K
Notes to Consolidated Financial Statements (continued)
ultimate outcome of these matters will not have a material
adverse impact on the results of operations, liquidity or
financial position of the Company. However, if one or more
of these examinations has an unfavorable resolution, it is
possible that the results of operation, liquidity or financial
position of the Company could be materially affected in any
particular period.
(12) EARNINGS (LOSS) PER SHARE
The Company uses the two-class method to compute basic and diluted earnings per common share. In periods of net loss, no
effect is given to the Company’s participating securities as they do not contractually participate in the losses of the Company. The
following table sets forth the computation of basic and diluted earnings per share (in thousands, except share and per
share data):
2012 2011 2010
NUMERATOR:
Net (loss) earnings before allocation of earnings to participating securities $ (49,295) $ (17,062) $ 104
Less: Earnings allocated to participating securities ——7
Net (loss) earnings after allocation of earnings to participating securities $ (49,295) $ (17,062) $ 97
DENOMINATOR:
Weighted average number of common shares outstanding — basic 16,331,672 17,371,315 18,601,465
Dilutive effect of share-based awards: —— 51,547
Weighted average number of common shares outstanding — dilutive 16,331,672 17,371,315 18,653,012
Basic (loss) earnings per common share attributable to Build-A-Bear Workshop, Inc,
stockholders: $ (3.02) $ (0.98) $ 0.01
Diluted (loss) earnings per common share attributable to Build-A-Bear Workshop, Inc,
stockholders $ (3.02) $ (0.98) $ 0.01
In calculating diluted earnings per share for fiscal 2012, 2011 and 2010, options to purchase 1,155,239, 1,210,816,
and 627,456, respectively, shares of common stock were outstanding at the end of the period, but were not included in the
computation of diluted earnings per share due to their anti-dilutive effect.
Due to the net loss in fiscal 2012 and fiscal 2011, the denominator for diluted earnings per common share is the same as
the denominator for basic earnings per common share for those periods because the inclusion of stock options and unvested
restricted shares would be anti-dilutive.
(13) STOCK INCENTIVE PLANS
On April 3, 2000, the Company adopted the 2000 Stock
Option Plan (the Plan). In 2003, the Company adopted the
Build-A-Bear Workshop, Inc. 2002 Stock Incentive Plan, in
2004, the Company adopted the Build-A-Bear Workshop, Inc.
2004 Stock Incentive Plan and in 2009, the Company
amended and restated the Build-A-Bear Workshop, Inc. 2004
Stock Incentive Plan (collectively, the Plans).
Under the Plans, as amended, from January 3, 2009, up
to 3,230,000 shares of common stock were reserved and
may be granted to employees and nonemployees of the
Company. The Plan allows for the grant of incentive stock
options, nonqualified stock options, stock appreciation rights
(SAR) and restricted stock. Options granted under the Plan
expire no later than 10 years from the date of the grant. The
exercise price of each incentive stock option shall not be less
than the fair value of the stock subject to the option on the
date the option is granted. The vesting provision of individual
options is at the discretion of the compensation committee of
the board of directors and generally ranges from one to four
years. Each share of stock awarded pursuant to an option or
subject to the exercised portion of a SAR reduces the number
of shares available by one share. Each share of stock
awarded pursuant to any other stock-based awards, including
restricted stock grants, reduces the number of shares available
by 1.27 shares.
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