EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2014

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 is as follows:


	Three months ended September 30,						Nine months ended September 30,
(In thousands except per share data )	2014			2013			2014			2013
Net income available for stockholders	$	1,882		$	2,002		$	6,873		$	5,386
Less: Dividends paid		(1,144	)		(1,140	)		(3,435	)		(3,423	)
Undistributed earnings	$	738		$	862		$	3,438		$	1,963

Basic shares outstanding:
Common stock		35,642			35,556			35,710			35,516
Restricted shares of common stock		1,262			1,271			1,240			1,263
		36,904			36,827			36,950			36,779
Diluted shares outstanding:
Common stock		35,642			35,556			35,710			35,516
Dilutive effect of stock based awards		286			353			286			279
		35,928			35,909			35,996			35,795
Restricted shares of common stock		1,262			1,271			1,240			1,263
		37,190			37,180			37,236			37,058

Inclusion of all participating securities in the computation of Earnings Per Share (EPS) under the two-class method had no impact on the Basic EPS amounts reported for the three months ended September 30, 2014 and 2013, and a reduction of $0.01 for the nine months ended September 30, 2014 and 2013.

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:


	Three months ended September 30,		Nine months ended September 30,
(in thousands)	2014	2013	2014	2013
Stock options	-	42	-	42

- Definition

The entire disclosure for earnings per share.

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