Pension Plans

9 Months Ended

Sep. 30, 2011

Pension Plans

Pension Plans

NOTE 7 — Pension Plans

We maintain a non-contributory tax qualified defined benefit pension plan.  All of our full time employees were eligible to participate in the qualified plan.  Benefits provided by our qualified pension plan were based on years of service and employees’ remuneration over their employment period.  Pension costs are funded in accordance with the provisions of the Internal Revenue Code.  We also maintain a non-qualified, non-contributory defined benefit pension plan for certain employees.  This excess plan provided benefits that would otherwise be provided under the qualified pension plan but for maximum benefit and compensation limits applicable under federal tax law.  The cost associated with the excess plan is determined using the same actuarial methods and assumptions as those used for our qualified pension plan.

On June 15, 2011, we decided to freeze participation and benefit accruals under our pension plans, primarily to reduce some of the volatility in earnings that can accompany the maintenance of a defined benefit plan.  The freeze was effective July 31, 2011.  Compensation earned by employees up to July 31, 2011 shall be used for purposes of calculating benefits under our pension plan but there will be no future benefit accruals after this date.  Participants as of July 31, 2011 will continue to earn vesting credit with respect to their frozen accrued benefits as they continue to work.  We accounted for the freeze of our pension plans as of June 30, 2011, which resulted in a curtailment loss of $45,000 and reduced our liability for pension benefits and increased comprehensive earnings by $654,000.

The components of net periodic pension cost are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
Service cost	$	11,000		$	78,000		$	145,000		$	236,000
Interest cost	121,000			115,000			371,000			345,000
Expected return on plan assets	(137,000		)	(120,000		)	(390,000		)	(360,000		)
Curtailment loss	—			—			45,000			—
Recognized net actuarial loss	28,000			31,000			112,000			94,000
Net amortization	—			7,000			10,000			19,000
	$	23,000		$	111,000		$	293,000		$	334,000

We expect to contribute approximately $700,000 to our pension plans in 2011, of which $318,000 and $447,000 was contributed during the three and nine-month periods ended September 30, 2011, respectively.  We contributed $65,000 and $130,000 to our pension plans during the three and nine-month periods ended September 30, 2010, respectively.