EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2011

3.	EARNINGS PER SHARE

Basic and diluted earnings per share are computed by dividing net income by the weighted average number of shares outstanding during the respective periods. The basic and diluted calculations differ as a result of the dilutive effect of stock options and time lapse restricted shares included in diluted earnings per share, but excluded from basic earnings per share. In addition, the Company has periodically issued share-based payment awards that contain non-forfeitable rights to dividends and are therefore considered participating securities.

A reconciliation of weighted average shares outstanding along with the earnings per share attributable to restricted shares of common stock (participating securities) is as follows:

	Three months ended June 30,				Six months ended June 30,
(In thousands except per share data )		2011		2010		2011		2010
Net income available for stockholders:	$	1,229	$	2,465	$	1,895	$	2,385
Less: Dividends paid
Common Stock		-		-		-		-
Restricted shares of common stock		-		-		-		-
Undistributed income	$	1,229	$	2,465	$	1,895	$	2,385

Allocation of undistributed income:
Common Stock	$	1,196	$	2,405	$	1,844	$	2,327
Restricted shares of common stock		33		60		51		58

Basic shares outstanding:
Common Stock		35,386		35,277		35,350		35,270
Restricted shares of common stock		1,008		905		990		895
		36,394		36,182		36,340		36,165
Diluted shares outstanding:
Common Stock		35,386		35,277		35,350		35,270
Dilutive effect of stock options		387		521		508		488
		35,773		35,798		35,858		35,758
Restricted shares of common stock		1,008		905		990		895
		36,781		36,703		36,848		36,653
Basic earnings per share:
Common Stock:
Distributed earnings	$	-	$	-	$	-	$	-
Undistributed income		0.03		0.07		0.05		0.07
	$	0.03	$	0.07	$	0.05	$	0.07
Restricted shares of common stock:
Distributed earnings	$	-	$	-	$	-	$	-
Undistributed income		0.03		0.07		0.05		0.06
	$	0.03	$	0.07	$	0.05	$	0.06
Diluted earnings per share:
Common Stock:
Distributed earnings	$	-	$	-	$	-	$	-
Undistributed income		0.03		0.07		0.05		0.07
	$	0.03	$	0.07	$	0.05	$	0.07

The effect of the Company’s stock options as shown below have been excluded from the computation of diluted earnings per share for the following periods, as their effect would have been anti-dilutive:

(in thousands)	Three months ended June 30,				Six months ended June 30,
	2011		2010		2011		2010
Stock options		42		42		42		42

- Definition

The entire disclosure for earnings per share.

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