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OUTSTANDING SHARES AND EARNINGS PER SHARE
 6 Months Ended
Jun. 30, 2022
OUTSTANDING SHARES AND EARNINGS PER SHARE [Abstract]  
OUTSTANDING SHARES AND EARNINGS PER SHARE
10. 
OUTSTANDING SHARES AND EARNINGS PER SHARE

On January 27, 2022, the Board of Directors of the Company declared a 5% stock dividend payable March 25, 2022 to shareholders of record as of February 28, 2022. All income per share amounts have been adjusted to give retroactive effect to stock dividends.
Earnings Per Share (EPS)
Basic EPS includes no dilution and is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the respective period. Diluted EPS is computed by dividing net income available to common shareholders by the weighted average number of shares outstanding plus dilutive shares for the quarter. Diluted shares include all common stock equivalents (“in-the-money” stock options, unvested restricted stock, stock units, warrants and rights, convertible bonds and preferred stock), which reflects the potential dilution of securities that could share in the earnings of the Company.
The following table presents a reconciliation of basic and diluted EPS for the three and six months ended June 30, 2022 and 2021 (dollars in thousands except per share amounts):
 
  
Three months ended
June 30,
    
Six months ended
June 30,
  
 
  
2022
    
2021
    
2022
    
2021
  
Basic earnings per share:
                        
Net income
  
$
3,546
    
$
3,306
    
$
6,587
    
$
6,484
  
 
                                
Weighted average common shares outstanding
    
13,717,677
      
14,175,321
      
13,699,438
      
14,162,176
  
Basic EPS
  
$
0.26
    
$
0.23
    
$
0.48
    
$
0.46
  
 
                                
Diluted earnings per share:
                                
Net income
  
$
3,546
    
$
3,306
    
$
6,587
    
$
6,484
  
 
                                
Weighted average common shares outstanding
    
13,717,677
      
14,175,321
      
13,699,438
      
14,162,176
  
 
                                
Effect of dilutive shares
    
147,294
      
185,636
      
160,843
      
173,179
  
 
                                
Adjusted weighted average common shares outstanding
    
13,864,971
      
14,360,957
      
13,860,281
      
14,335,355
  
Diluted EPS
  
$
0.26
    
$
0.23
    
$
0.48
    
$
0.45
  

Stock options which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 391,900 shares and 237,987 shares for the three months ended June 30, 2022 and 2021, respectively. Unvested restricted stock which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 70,973 shares and 0 shares for the three months ended June 30, 2022 and 2021, respectively. Stock options which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 345,378 shares and 299,360 shares for the six months ended June 30, 2022 and 2021, respectively. Unvested restricted stock which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 52,936 shares and 21,051 shares for the six months ended June 30, 2022 and 2021, respectively.