Note 5. Net Income Per Share

On June 13, 2019, the Board of Directors approved a stock dividend of five percent (5%) on the outstanding shares of common stock of the Company (or .05 share for each share outstanding) which was issued on July 5, 2019 to all shareholders of record as of the close of business on June 26, 2019, referred to as the “5% Stock Dividend”. Shareholders received cash in lieu of any fractional shares that they otherwise would have been entitled to receive in connection with the stock dividend. The price paid for fractional shares was based on the volume-weighted average price of a share of common stock for the most recent three (3) days prior to the record date during which a trade of the Company’s stock occurred.

For the following table, share and per share data have been adjusted to reflect the 5% Stock Dividend. The table shows the weighted average number of shares used in computing net income per common share and the effect on the weighted average number of shares of diluted potential common stock for the three and six months ended June 30, 2019 and 2018. Potential dilutive common stock equivalents have no effect on net income available to common shareholders. (Dollars below reported in thousands except per share data.)

Three Months Ended	June 30, 2019					June 30, 2018
			Weighted	Per				Weighted	Per
			Average	Share				Average	Share
	Net Income		Shares	Amount		Net Income		Shares	Amount
Basic net income per share	$	2,115	2,688,005	$	0.79	$	1,832	2,666,120	$	0.69
Effect of dilutive stock options		-	960		-		-	22,225		(0.01	)
Diluted net income per share	$	2,115	2,688,965	$	0.79	$	1,832	2,688,345	$	0.68

Six Months Ended	June 30, 2019					June 30, 2018
			Weighted	Per				Weighted	Per
			Average	Share				Average	Share
	Net Income		Shares	Amount		Net Income		Shares	Amount
Basic net income per share	$	3,361	2,683,122	$	1.25	$	4,628	2,663,842	$	1.74
Effect of dilutive stock options		-	4,269		-		-	21,862		(0.02	)
Diluted net income per share	$	3,361	2,687,391	$	1.25	$	4,628	2,685,704	$	1.72

For the six-month period ended June 30, 2019, there were 66,308 option shares, as adjusted, considered anti-dilutive and excluded from this calculation. For the six-month period ended June 30, 2018, there were 65,888 options shares, as adjusted, considered anti-dilutive and excluded from this calculation.