Earnings Per Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share

5. Earnings Per Share

The Company reports earnings per share in accordance with Accounting Standards Codification Topic 260, “Earnings Per Share,” which establishes standards for computing and presenting earnings per share. Basic earnings per share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common shareholders by the weighted-average number of common shares and dilutive common share equivalents then outstanding. Potential common share equivalents consist of restricted stock awards and the incremental common shares issuable upon the exercise of stock options and warrants. Under the treasury stock method, unexercised “in-the-money” stock options and warrants are assumed to be exercised at the beginning of the period or at issuance, if later. The assumed proceeds are then used to purchase common shares at the average market price during the period. Share-based payment awards that entitle their holders to receive non-forfeitable dividends before vesting are considered participating securities and are considered in the calculation of basic and diluted earnings per share.

Basic and diluted weighted average shares outstanding were as follows:

	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
Weighted average common shares		31,643,695		30,845,137		31,443,264		30,787,399
Dilutive common stock options		673,461		303,953		672,255		285,046
Weighted average common shares, assuming dilution		32,317,156		31,149,090		32,115,519		31,072,445

At June 30, 2013, there were outstanding options to purchase 1,795,588 shares of the Company’s common stock at a weighted average exercise price of $4.53 per share. For the three and six-month periods ended June 30, 2013, 520,552 and 540,552 shares of the Company’s common stock, respectively, were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive.

At June 30, 2012, there were outstanding options to purchase 2,629,490 shares of the Company’s common stock at a weighted average exercise price of $4.08 per share. For the three and six-month periods ended June 30, 2012, 1,451,500 and 1,539,300 shares of the Company’s common stock, respectively, were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive.