Interleaf, Inc. Exhibit 11 - COMPUTATION OF EARNINGS PER SHARE Three months ended Six Months ended September 30 September 30 1997 1996 1997 1996 ---- ---- ---- ---- In thousands, except for per share amounts (unaudited) (unaudited) Primary Weighted average shares outstanding of Common Stock 17,757 17,457 17,691 17,229 Dilutive Senior Series B and Senior Series C Convertible Preferred Stock 5,178 -- 5,178 -- Dilutive stock options 1,818 -- 982 -- Dilutive stock purchase warrants -- -- -- -- Dilutive stock purchase plan rights 62 -- 44 -- ------- -------- ------- -------- Total 24,815 17,457 23,895 17,229 ====== ====== ====== ====== Net income (loss) $ 449 $(10,327) $ 835 $(14,127) ======= ======== ======= ======== Net income (loss) per share $ 0.02 $ (0.59) $ 0.03 $ (0.82) ======= ======== ======= ======== Fully Diluted Weighted average shares outstanding of Common Stock 17,757 17,457 17,691 17,229 Dilutive Senior Series B and Senior Series C Convertible Preferred Stock 5,178 -- 5,178 -- Dilutive stock options 1,971 -- 1,968 -- Dilutive stock purchase warrants -- -- -- -- Dilutive stock purchase plan rights 65 -- 59 -- ------- -------- ------- -------- Total 24,971 17,457 24,896 17,229 ======= ======== ======= ======== Net income (loss) $ 449 $(10,327) $ 835 $(14,127) ======= ======== ======= ======== Net income (loss) per share $ 0.02 $ (0.59) $ 0.03 $ (0.82) ======= ======== ======= ======== The dilutive effect of stock options, stock purchase warrants, and stock purchase plan rights are calculated using the treasury stock method. Under this method, these common stock equivalents are assumed to be exercised and proceeds from the exercise are assumed to be used to repurchase common stock at the average market price for primary income (loss) per share and the higher of the end of the period or average market price for fully diluted income (loss) per share. the dilutive effect of Convertible Preferred Stock is calculated using the if-converted method.