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 3,625 common shares, at exercise prices ranging from $4.60 to $5.22, and 101,070 common shares, at exercise prices ranging from $3.23 to $5.75, were outstanding as of September 30, 2014 and 2013, 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,
	2014		2013		2014		2013
	(In thousands, except per share data)
Numerator:
Net income	$	365	$	1,226	$	2,274	$	3,352
Preferred stock dividends		53		53		158		157
Net income available to common shareholders	$	312	$	1,173	$	2,116	$	3,195
Denominator:
Weighted average common shares outstanding (basic)		18,795		18,784		18,792		18,995
Effect of stock options		113		94		124		91
Weighted average common shares outstanding (diluted)		18,908		18,878		18,916		19,086
Earnings per common share:
Basic	$	0.02	$	0.06	$	0.11	$	0.17
Diluted		0.02		0.06		0.11		0.17

- Definition

The entire disclosure for earnings per share.

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