STOCK COMPENSATION EXPENSE (Tables)

9 Months Ended

Sep. 30, 2014

STOCK COMPENSATION EXPENSE [Abstract]

Assumption Used in the Black-Scholes Option-pricing Model

The assumptions used in the Black-Scholes option-pricing model are as follows:

	2014			2013
Risk-free interest rate		2.78	%		1.96	%
Expected option life (yrs)		10.00			10.00
Expected stock price volatility		31.19	%		35.24	%
Dividend yield		3.33	%		3.86	%
Weighted average fair value of options granted	$	3.74		$	2.85

Summary of Stock Option Activity

A summary of the Company’s stock option activity and related information is presented below for the nine months ended September 30:

	2014					2013
				Weighted Average Exercise					Weighted Average Exercise
	Options			Price		Options			Price
Outstanding at beginning of year		354,281		$	9.84		392,366		$	9.24
Grants		46,300			14.43		52,900			11.39
Exercises		(77,896	)		8.52		(60,043	)		7.63
Forfeitures or expired		(8,133	)		9.27		(12,401	)		7.90
Outstanding at September 30,		314,552		$	10.86		372,822		$	9.76
Exercisable at September 30,		209,299					231,272
Weighted average remaining life of options outstanding		6.1					6.2
Weighted average fair value of options granted during the year	$	3.74				$	2.85

Stock Option Activity by Range of Exercise Prices

Additional information regarding stock options outstanding and exercisable at September 30, 2014, is provided in the following table:

		Outstanding						Currently Exercisable
Range of Exercise Prices		Number		Weighted Average Exercise Price		Aggregate Intrinsic Value		Number		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Aggregate Intrinsic Value
$	6.50 to $10.00		136,049	$	7.51	$	970		108,356		6.4	$	7.52	$	771
$	10.01 to $12.50		55,603		11.44		178		24,343		4.7		11.50		77
$	12.51 to $15.00		99,400		13.91		72		53,100		2.9		13.46		63
$	15.01 to $17.50		23,500		16.00		0		23,500		1.4		16.00		-
Outstanding - Sept 30, 2014			314,552		10.86	$	1,220		209,299		4.8		10.44	$	911