8. Earnings Per Share

The Company computes earnings per share using the two-class method, an earnings allocation formula that determines earnings per share for common stock and participating securities according to dividends declared and participation rights in undistributed earnings, when that method results in a more dilutive effect than the treasury method. The Company’s unvested grants of restricted stock granted prior to 2014 contain non-forfeitable rights to dividends, should any be declared, and are treated as participating securities and included in the computation of earnings per share.

The restricted shares granted in 2014 contain a provision making the payment of dividends contingent upon vesting of the shares. These shares are not participating shares because any accumulated unvested dividends are forfeited, along with the shares, if the awards fail to vest. These non-participating shares are excluded from the computation of net income allocated to participating securities in the table below, but are included in the computation of weighted average dilutive securities, unless their inclusion would be anti-dilutive.

Net income available to common shareholders and the weighted average number of common shares used to compute basic and diluted earnings per share was as follows:

	Three months ended						Six months ended
	June 30,						June 30,
(In thousands, except per share data)	2014			2013			2014			2013
Numerator:
Net income	$	7,741		$	9,462		$	14,013		$	16,422
Less: Net income allocated to participating securities	(54		)	(94		)	(116		)	(154		)
Net income available to common shareholders	$	7,687		$	9,368		$	13,897		$	16,268

Denominator:
Weighted average common shares outstanding	21,115			20,785			21,108			20,723
Weighted average dilutive securities	516			612			492			660
Weighted average common shares outstanding, diluted	21,631			21,397			21,600			21,383

Income per common share, basic	$	0.36		$	0.45		$	0.66		$	0.79
Income per common share, diluted	$	0.36		$	0.44		$	0.64		$	0.76

For the three and six month periods ended June 30, 2014 and 2013, certain common stock equivalents were excluded from the calculation of dilutive securities because their inclusion would either have been anti-dilutive or, for stock options, the exercise prices of those stock options were greater than the average market price of the Company’s common stock for the period. All of the Company’s non-participating unvested restricted shares were included in the computation of weighted average dilutive securities. The following table summarizes the shares of common stock underlying the Company’s unvested stock options and performance awards that were excluded from the calculation of dilutive securities:

	Three months ended		Six months ended
	June 30,		June 30,
(In thousands)	2014	2013	2014	2013

Stock options	104	221	104	221
Performance awards	85	—	85	—

Share Repurchase Program

During the six months ended June 30, 2014 the Company repurchased 30,600 shares of common stock (at a weighted-average price of $24.54 per share) under its $25.0 million stock repurchase program (the “Repurchase Program”), which expires August 31, 2015. The total cost of $0.8 million was recorded as a reduction of additional paid-in capital as of June 30, 2014. These repurchases represent the first share repurchases under the Repurchase Program, leaving $24.2 million available for further share repurchases. All shares repurchased under the Repurchase Program were retired and returned to authorized and unissued.