NOTE E - CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

The Company considers all highly liquid marketable securities with an original maturity of three months or less to be cash equivalents. Cash equivalents include money market funds and certificates of deposit. The Company deposits its cash in high quality financial institutions. The balances, at times, may exceed federally insured limits. Certificates of deposits are reported at par value, and money market funds are reported at fair value determined using quoted prices in active markets for identical securities (Level 1, as defined by FASB ASC 820).

The Company has classified all marketable securities as available-for-sale, which requires the securities to be reported at fair value, with unrealized gains and losses, net of tax, reported as a separate component of stockholders' equity. Highly liquid, tax-exempt variable rate demand notes with put options exercisable in three months or less are classified as marketable securities. Also included are certificates of deposit.

At July 3, 2011 and December 31, 2010, cost for marketable securities was determined using the specific identification method. A summary of the amortized costs and fair values of the Company's marketable securities at the end of the periods presented is shown in the following table. All of the Company's marketable securities are classified as Level 2, as defined by FASB ASC 820, with fair values determined using significant other observable inputs, which include quoted prices in markets that are not active, quoted prices of similar securities, recently executed transactions, broker quotations, and other inputs that are observable. There were no transfers into or out of Level 2 during the three months ended July 3, 2011.


				(In Thousands)
				MARKETABLE SECURITIES
						Gross		Gross
		Amortized				Unrealized		Unrealized
		Cost		Fair Value		Gains		Losses
July 3, 2011
Tax-exempt
Municipal Bonds	$	46,888	$	47,086	$	270	$	72
Variable Rate
Demand Notes		34,410		34,410		0		0
Total Marketable
Securities	$	81,298	$	81,496	$	270	$	72

December 31,
2010
Tax-exempt
Municipal Bonds	$	62,339	$	62,537	$	354	$	156
Variable Rate
Demand Notes		37,779		37,779		0		0
Certificates of
Deposit		689		689		0		0
Total Marketable
Securities	$	100,807	$	101,005	$	354	$	156

Proceeds from sales of available-for-sale securities totaled $9,462,000 and $28,985,000 for the three month periods ended July 3, 2011 and July 4, 2010, and totaled $45,347,000 and $44,284,000 for the six month periods then ended, respectively. There were no gross gains or losses related to sales of marketable securities during the same periods. Net unrealized gains (losses) included in accumulated other comprehensive income were $18,000 and $35,000 before taxes for the three month periods ended July 3, 2011 and July 4, 2010, and were ($1,000) and ($283,000) before taxes for the six month periods then ended, respectively. No unrealized gains (losses) were reclassified out of accumulated other comprehensive income during the same periods.

The contractual maturities of the marketable securities held at July 3, 2011 are as follows: $18,485,000 within one year; $32,210,000 beyond one year to five years; $15,068,000 beyond five years to ten years, and $15,733,000 beyond ten years. All of the instruments in the beyond five year ranges, with the exception of $3,907,000 of tax-exempt municipal bonds with maturities between five and six years, are variable rate demand notes which can be tendered for cash at par plus interest within seven days. Despite the stated contractual maturity date, to the extent a tender is not honored, the notes become immediately due and payable.