Retirement Benefits

6 Months Ended

Jun. 30, 2013

Retirement Benefits [Abstract]

Retirement Benefits

8. Retirement Benefits

The Company maintains a noncontributory supplemental retirement program that was established for key management. No new participants have been admitted to this program since 2001 and the benefits of active participants were frozen in 2005. The program participants do not include any of the Company’s current executive officers. The supplemental retirement program requires continued employment or disability through the date of expected retirement. The cost of the program is accrued over the average expected future lifetime of the participants. The program provides for vesting of benefits under certain circumstances. Funding is not required, but the Company has made investments in annuity contracts and maintains life insurance policies on the lives of the individual participants to assist in payment of retirement benefits. The Company is the owner and beneficiary of the annuity contracts and life insurance policies; accordingly, the cash value of the annuity contracts and the cash surrender value of the life insurance policies are reported on the unaudited condensed consolidated balance sheet and the appreciation is included in the unaudited condensed consolidated statement of operations.

In June 2005, the program was amended to freeze accrual of all benefits to active participants provided under the program. The Company continues to recognize periodic pension cost related to the program, but the amount is lower as a result of the curtailment.

The net periodic pension cost for the Company’s supplemental retirement program is as follows (in thousands):

	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
Interest cost	$	204	$	234	$	409	$	468
Amortization of loss		77		45		154		90
Net periodic pension cost	$	281	$	279	$	563	$	558

The discount rate used to determine net periodic pension cost was 3.55% for both the three and six months ended June 30, 2013. The discount rate used to determine net periodic pension cost was 4.48% for both the three and six months ended June 30, 2012.