14. SHAREHOLDERS’ EQUITY

Share Repurchase Plan

At December 31, 2019, the Company had a stock repurchase plan which has no expiration date. During the year ended December 31, 2019, the Company repurchased 98,603 shares. The total number of shares available for repurchase at December 31, 2019 was 380,551. Repurchases are generally made in the open market at market prices.

Earnings Per Share

A reconciliation of the numerators and denominators of the basic and diluted earnings per share computations is as follows:


	For the Years Ended December 31,
	2019		2018		2017
Basic Earnings Per Share
Net income (dollars in thousands)	$	35,961	$	29,677	$	19,539
Weighted average shares outstanding		15,311,113		15,261,794		14,172,196
Basic earnings per share	$	2.35	$	1.94	$	1.38

Diluted Earnings Per Share
Net income (dollars in thousands)	$	35,961	$	29,677	$	19,539
Weighted average shares outstanding		15,311,113		15,261,794		14,172,196
Effect of dilutive stock options		125,998		170,326		185,586
Weighted average shares outstanding		15,437,111		15,432,120		14,357,782
Diluted earnings per share	$	2.33	$	1.92	$	1.36

Stock options for 243,657, 157,532, and 90,000 shares of common stock were not considered in computing diluted earnings per common share for 2019, 2018, and 2017, respectively, because they were antidilutive.

Stock Options

On March 16, 2017 the Company’s Board of Directors approved and adopted the 2017 Stock Incentive Plan (the “2017 Plan”), which became effective May 24, 2017 pursuant to the approval of the Company’s shareholders. The 2017 Plan replaced the Company’s 2007 Stock Incentive Plan (the “2007 Plan”), which expired by its own terms on March 15, 2017. Options to purchase 376,220 shares that were granted under the 2007 Plan were still outstanding as of December 31, 2019, and remain unaffected by that plan’s expiration. The 2017 Plan provides for the issuance of both “incentive” and “nonqualified” stock options to officers and employees, and of “nonqualified” stock options to non-employee directors and consultants of the Company. The 2017 Plan also provides for the issuance of restricted stock awards to these same classes of eligible participants, although no restricted stock awards have ever been issued by the Company. The total number of shares of the Company’s authorized but unissued stock reserved for issuance pursuant to awards under the 2017 Plan was initially 850,000 shares, and the number remaining available for grant as of December 31, 2019 was 672,600.

All options granted under the 2017 and 2007 Plans have been or will be granted at an exercise price of not less than 100% of the fair market value of the stock on the date of grant, exercisable in installments as provided in individual stock option agreements. In the event of a “Change in Control” as defined in the Plans, all outstanding options shall become exercisable in full (subject to certain notification requirements), and shall terminate if not exercised within a specified period of time unless such options are assumed by the successor corporation or substitute options are granted. Options also terminate in the event an optionee ceases to be employed by or to serve as a director of the Company or its subsidiaries, and the vested portion thereof must be exercised within a specified period after such cessation of employment or service.

A summary of the Company’s stock option activity follows (shares in thousands, except exercise price):


	2019					2018			2017
	Shares	Weighted Average Exercise Price		Aggregate Intrinsic Value (1)		Shares	Weighted Average Exercise Price		Shares	Weighted Average Exercise Price
Outstanding,
beginning of year	453	$	18.45			455	$	16.33	467	$	14.12
Exercised	(83)	$	13.07			(77)	$	14.67	(70)	$	12.42
Granted	102	$	26.97			84	$	27.35	91	$	28.21
Canceled	(14)	$	26.77			(9)	$	26.73	(33)	$	26.41
Outstanding, end of year	458	$	21.08	$	3,684	453	$	18.45	455	$	16.33
Exercisable, end of year (2)	322	$	18.89	$	3,297	330	$	15.77	400	$	15.57

⁽¹⁾

The aggregate intrinsic value of stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had all option holders exercised their options on December 31, 2019. This amount changes based on changes in the market value of the Company’s stock.

⁽²⁾

The weighted average remaining contractual life of stock options outstanding and exercisable on December 31, 2019 was 6.1 years and 5.1 years, respectively.

Information related to stock options during each year follows:


	2019		2018		2017
Weighted-average grant-date fair value per share	$	6.60	$	5.94	$	6.13
Total intrinsic value of stock options exercised	$	1,150,000	$	988,000	$	1,042,000
Total fair value of stock options vested	$	438,000	$	55,000	$	494,000

Cash received from the exercise of 83,261 shares was $1,088,000 for the period ended December 31, 2019 with a related tax benefit of $278,000.

The Company is using the Black-Scholes model to value stock options. In accordance with U.S. GAAP, charges of $491,000, $373,000, and $476,000 are reflected in the Company’s income statements for the years ended December 31, 2019, 2018, and 2017, respectively, as pre-tax compensation and directors’ expense related to stock options. The related tax benefit of these options is $81,000, $67,000, and $141,000 for the years ended December 31, 2019, 2018, and 2017, respectively.

Unamortized compensation expense associated with unvested stock options outstanding at December 31, 2019 was $314,000, which will be recognized over a weighted average period of 3.3 years.