Shareholders' Equity

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

Shareholders' Equity

6. Shareholders’ Equity

							($000’s omitted except for share data)
	Common Stock
	Number of  shares issued		Amount		Capital in excess of par value		Retained earnings			ESOT			Treasury stock			Accumulated other comprehensive loss			Total shareholders’ equity
Balance at December 31, 2015		2,614,506	$	523	$	14,092	$	13,395		$	(863	)	$	(1,702	)	$	(3	)	$	25,442
Net income		-		-		-		1,628			-			-			-			1,628
Purchase of treasury shares		-		-		-		-			-			(197	)		-			(197	)
Cash dividend		-		-		-		(380	)		-			-			-			(380	)
Stock based compensation, net of tax benefit		-		-		54		-			-			334			-			388
Balance at September 30, 2016		2,614,506	$	523	$	14,146	$	14,643		$	(863	)	$	(1,565	)	$	(3	)	$	26,881

The Company’s Board of Directors authorized the purchase of up to 450,000 shares of its common stock in the open market or in privately negotiated transactions. As of September 30, 2016, the Company has purchased 337,609 shares and there remain 112,391 shares available to purchase under this program. There were 5,639 shares purchased by the Company during the nine month period ended September 30, 2016.

On April 18, 2013, the Company issued 165,000 shares of restricted stock to Executive Officers of the Company under the Company’s 2012 Long-Term Incentive Plan that was approved by the shareholders at the 2012 Annual Meeting of Shareholders. This plan authorizes the issuance of up to 300,000 shares. The restricted share awards vest over four year periods between January 2014 and January 2017 and have voting rights and accrue dividends prior to vesting. The aggregate amount of expense to the Company, measured based on grant date fair value is expected to be $1,336,500 and will be recognized over the four year requisite service period.

On April 11, 2016, the Company issued 51,000 shares of restricted stock to Executive Officers and certain key management of the Company under the Company’s 2012 Long-Term Incentive Plan. The restricted share awards have varying vesting periods between January 2017 and January 2018; however, these shares have voting rights and accrue dividends prior to vesting. The aggregate amount of expense to the Company, measured based on grant date fair value is expected to be approximately $406,000 and will be recognized over the requisite service period.

Included in the nine months ended September 30, 2016 and 2015 is approximately $386,000 and $271,000, respectively, of compensation expense related to the restricted share awards.

On January 1, 2016, 41,250 shares of restricted stock vested of which 17,335 shares were withheld and repurchased by the Company for approximately $145,000 to satisfy statutory minimum withholding tax requirements for those participants who elected this option as permitted under the Company’s 2012 Long-Term Incentive Plan.

On March 14, 2016, the Company announced that its Board of Directors declared a $0.15 per share cash dividend. The dividend was subsequently paid on May 16, 2016 to shareholders of record on April 11, 2016 and was approximately $380,000 in the aggregate. These dividends do not represent that the Company will pay dividends on a regular or scheduled basis. The amount is recorded as a reduction to retained earnings on the accompanying consolidated balance sheet.

Earnings Per Share

Basic earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period. The weighted average number of common shares outstanding does not include any potentially dilutive securities or any unvested restricted shares of common stock. These unvested restricted shares, although classified as issued and outstanding, are considered forfeitable until the restrictions lapse and will not be included in the basic EPS calculation until the shares are vested. Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period plus the number of shares of common stock that would be issued assuming all contingently issuable shares having a dilutive effect on the earnings per share that were outstanding for the period. Incremental shares from assumed conversions are calculated as the number of shares that would be issued, net of the number of shares that could be purchased in the marketplace with the cash received upon stock option exercise. The dilutive effect of unvested restricted stock is determined using the treasury stock method.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	($000’s omitted except per share data)
Net income	$	366	$	744	$	1,628	$	4,136
Weighted average common shares outstanding (basic)		2,219		2,179		2,203		2,179
Incremental shares from assumed conversions of stock options		-		-		-		-
Unvested restricted stock		92		82		92		82
Weighted average common Shares outstanding (diluted)		2,311		2,261		2,295		2,261
Basic
Net income per share	$	0.17	$	0.34	$	0.74	$	1.90
Diluted
Net income per share	$	0.16	$	0.33	$	0.71	$	1.83