STOCK BASED COMPENSATION

9 Months Ended

Sep. 30, 2013

STOCK BASED COMPENSATION [Abstract]

STOCK BASED COMPENSATION

NOTE 12                      STOCK BASED COMPENSATION

Board of Director’s Stock Compensation

Members of the Board of Directors receive common shares of the Corporation equal in value to the amount of

fees individually earned during the previous year for service as a director.  The common shares are distributed to

the Corporation's individual board members from treasury shares of the Corporation on or about January 15

following the calendar year of service.

Additionally, the President and Chief Executive Officer of the Corporation, who does not receive cash

compensation as a member of the Board of Directors, is awarded common shares equal in value to the average of

those awarded to board members not employed by the Corporation who have served for 12 months during the

prior year.

During January 2013 and 2012, 7,969 and 10,238 shares, respectively, were re-issued from treasury to fund the

stock component of directors' compensation.  An expense of $185,263 and $156,863 related to this compensation

was recognized during the nine month period ending September 30, 2013 and September 30, 2012, respectively.  

This expense is accrued as shares are earned.

Restricted Stock Plan

Pursuant to the Corporation’s Restricted Stock Plan (the “Plan”), the Corporation may make discretionary grants

of restricted stock to officers other than the Corporation's Chief Executive Officer.  Compensation expense is

recognized over the vesting period of the awards based on the fair value of the stock at issue date.

A summary of restricted stock activity from December 31, 2012 to September 30, 2013 is presented below:

	Shares	Weighted–Average Grant Date Fair Value
Nonvested at December 31, 2012	20,009	$	23.84
Granted	-		-
Vested	2,197		22.60
Forfeited or Cancelled	1,797		25.04
Nonvested at September 30, 2013	16,015	$	23.98

As of September 30, 2013, there was $313,272 of total unrecognized compensation cost related to nonvested

shares granted under the Plan.  The cost is expected to be recognized over a weighted-average period of 3.60

years.  The total fair value of shares vested during the nine months ended September 30, 2013 was $66,780.