EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2015

Basic earnings per common share is calculated by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per common share is adjusted for the dilutive effects of stock options, warrants, and restricted stock. The diluted average number of common shares outstanding has been increased for the assumed exercise of stock options and warrants with proceeds used to purchase treasury shares at the average market price for the period. Earnings per share for the years ended December 31 were calculated as follows (in thousands, except share and per share data):



	2015		2014	2013
Net income	$	11,474	9,869	8,780

Weighted average number of shares outstanding used in the calculation of basic earnings per common share	9,704,965		9,297,019	7,852,514

Add dilutive effect of:
Stock options	17,174		18,545	23,456
Stock warrants	89,328		90,782	107,027
Restricted shares	9		—	—

Adjusted weighted average number of shares outstanding used in the calculation of diluted earnings per common share	9,811,476		9,406,346	7,982,997

Earnings per common share:
Basic	$	1.18	1.06	1.12
Diluted	1.17		1.05	1.10

Options to purchase 12,962, 12,962, and 6,400 shares of common stock at weighted average prices of $18.41, $18.41, and $18.95 per share were outstanding at December 31, 2015, 2014, and 2013, respectively, and were not included in the computation of diluted earnings per common share because the exercise prices of the options were greater than the average market prices of the common shares.