4. Earnings Per Common Share

Basic earnings per share include only the weighted average common shares outstanding. Diluted earnings per share include the weighted average common shares outstanding and any potentially dilutive common stock equivalent shares in the calculation. Treasury shares are treated as retired for earnings per share purposes. Options to purchase 101,070 common shares, at exercise prices ranging from $3.23 to $5.75, and 182,351 common shares, at exercise prices ranging from $2.75 to $5.75, were outstanding as of September 30, 2013 and 2012, respectively, but were not included in the computation of diluted earnings per common share because to do so would be antidilutive. Dividends on preferred shares are deducted from net income in the calculation of earnings per common share.


	Three months ended September 30,				Nine months ended September 30,
	2013		2012		2013		2012
	(In thousands, except per share data)
Numerator:
Net income	$	1,226	$	1,307	$	3,352	$	4,304
Preferred stock dividends		53		251		157		776
Net income available to common shareholders	$	1,173	$	1,056	$	3,195	$	3,528
Denominator:
Weighted average common shares outstanding (basic)		18,784		19,275		18,995		19,844
Effect of stock options		94		76		91		60
Weighted average common shares outstanding (diluted)		18,878		19,351		19,086		19,904
Earnings per common share:
Basic	$	0.06	$	0.05	$	0.17	$	0.18
Diluted		0.06		0.05		0.17		0.18

- Definition

The entire disclosure for earnings per share.

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