. Basic and diluted earnings per common share:

Basic earnings per common share has been calculated by dividing net income for the period by the weighted average number of common shares outstanding during each period. Diluted earnings per share has been calculated by dividing net income for the period by the weighted average number of common shares and potentially dilutive common shares outstanding during the period. In computing diluted earnings per share, the treasury stock method is used to determine the number of shares assumed to be purchased from the conversion of common share equivalents or the proceeds of option exercises.

The following table is a summary of the basic and diluted earnings per common share:

	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016

Numerator for basic and diluted earnings per common share:
Net income for the period	$	3,439,266	$	4,741,279	$	11,127,241	$	13,250,303

Denominator for basic and diluted earnings per common share:
Basic weighted average number of common shares outstanding		10,564,311		10,432,763		10,522,841		10,549,056
Effect of outstanding stock options		221,031		186,242		262,209		187,719
Diluted weighted average number of shares outstanding		10,785,342		10,619,005		10,785,050		10,736,775

Basic earnings per common share	$	0.33	$	0.45	$	1.06	$	1.26

Diluted earnings per common share	$	0.32	$	0.45	$	1.03	$	1.23

For

the

three

months ended

September 30, 2017,

outstanding options to purchase

345,200

common shares were

not

included in the computation of diluted income per common share because all such options had exercise prices greater than the average market price of the common shares (

three

months ended

September 30, 2016 –

76,750

For the

nine

months ended

September 30, 2017,

outstanding options to purchase

349,700

common shares were

not

included in the computation of diluted income per common share because all such options had exercise prices greater than the average market price of the common shares

(

nine

months ended

September 30, 2016 –

95,950

During

the

three

and

nine

months ended

September 30, 2017,

common shares were repurchased and cancelled under the terms of our stock repurchase program announced in

March 2017.

During the

three

months ended

September 30, 2016,

common shares were repurchased and for the

nine

months ended

September 30, 2016,

308,416

common shares were repurchased and cancelled under the terms of our stock repurchase program announced in

February

2016.

The computation of earnings per share and diluted earnings per share for the

three

and

nine

months ended

September 30, 2017

and

2016

include reductions in the number of shares outstanding due to these repurchases.