Commitments and Contingencies

12 Months Ended

Dec. 31, 2011

Commitments and Contingencies {1}

Commitments and Contingencies

(9)       Commitments and Contingencies

Commitments to Extend Credit

The Company is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. These instruments involve various levels and elements of credit and interest rate risk in excess of the amount recognized in the accompanying consolidated financial statements. The contract or notional amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments. The Company had $57.0 million and $60.6 million in commitments to extend credit to customers and $2.5 million and $2.1 million in standby/commercial letters of credit at December 31, 2011 and 2010, respectively.  The Company also guarantees the outstanding balance on credit cards offered at the Company, but underwritten by another financial institution.  The outstanding balances on these credit cards were $54,000 and $49,000 as of December 31, 2011 and 2010, respectively.

Lease Commitments

The Company leases office premises under three operating leases that will expire in May 2012, June 2014 and November 2017, respectively.  Rental expense, which is included in occupancy expense and is reduced for any sublease income earned during the period, was $542,000 and $459,000 for the years ended December 31, 2011 and 2010, respectively.  Sublease income earned during the years ended December 31, 2011 and 2010 were $106,000 and $97,000, respectively.

The projected minimum rental payments under the term of the leases at December 31, 2011 are as follows (in thousands):

Years ending December 31,
2012	$	662
2013	639
2014	374
2015	107
2016	111
Thereafter	104
Total	$	1,997

Litigation

The Company from time to time is party to lawsuits, which arise out of the normal course of business. At December 31, 2011 and 2010, the Company did not have any litigation that management believes will have a material impact on the Consolidated Balance Sheets or Consolidated Statements of Operations.

Restricted Stock

The following table sets forth the Company’s future restricted stock expense, net of estimated forfeitures (in thousands):

Years ending December 31,
2012	$	450
2013	277
2014	140
2015	47
2016	11
Total	$	925