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Common Stock and Earnings per Share

12 Months Ended

Dec. 31, 2017

Note 9
Common Stock and Earnings per Share

The table below shows activity in the outstanding shares of the Company’s common stock during 2017.

	2017
Shares outstanding at January 1	11,188,466
10% stock dividend issued December 15, 2017	1,116,711
Issuance of common stock:
Employee restricted stock grants	3,825
Employee SARs exercised	7,547
Directors’ compensation	8,389
Shares repurchased	(38,042	)
Shares outstanding at December 31	12,286,896

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the sum of the weighted average number of common shares outstanding and the weighted average number of potential common shares outstanding. Under the treasury stock method, stock appreciation rights (“SARs”) are dilutive when the average market price of the Company’s common stock, combined with the effect of any unamortized compensation expense, exceeds the SAR price during a period. Anti-dilutive shares are those SARs with prices in excess of the current market value.

The calculations of basic and diluted earnings per share are as follows:

	December 31,
(In thousands except share and per share data)	2017		2016		2015
Basic:
Net income	$	25,014	$	24,348	$	23,056
Weighted average common shares outstanding		12,250,465		12,265,434		12,494,466
Basic earnings per share	$	2.04	$	1.99	$	1.85
Diluted:
Net income	$	25,014	$	24,348	$	23,056
Weighted average common shares outstanding		12,250,465		12,265,434		12,494,466
Effect of dilutive restricted stock, PBRS and SARs		179,445		172,386		175,784
Weighted average common shares outstanding assuming dilution		12,429,910		12,437,820		12,670,250
Diluted earnings per share	$	2.01	$	1.96	$	1.82

All share and per share data have been restated to give effect to the 10% stock dividend issued on December 15, 2017.