Note 13.

Employee Benefit Plans

Employee Stock Ownership and Savings Plan

The Company maintains the Employee Stock Ownership and Savings Plan (“KSOP”). Coverage under the plan is provided to all employees who meet minimum eligibility requirements. The KSOP held 499,075 shares of the Company’s common stock as of December 31, 2013, 561,551 shares as of December 31, 2012, and 588,656 shares as of December 31, 2011.

Employer Stock Fund

The Company made annual contributions to the stock feature within the KSOP at the discretion of the Board of Directors until December 31, 2006, when the plan was frozen to future contributions. Substantially all plan assets are invested in the Company’s common stock. All KSOP contributions beginning in 2007 have been made to the employee savings feature of the plan.

Employee Savings Plan

The Company provides a 401(k) savings feature within the KSOP. The Company makes matching contributions to employee deferrals at levels determined by the Board of Directors on an annual basis. The cost of the Company’s 100% matching contributions to qualified deferrals under the 401(k) savings component of the KSOP was $1.61 million in 2013, $1.27 million in 2012, and $1.34 million in 2011. In 2013 and 2011, all matching contributions were made in the Company’s common stock. In 2012, matching contributions were made in cash and the Company’s common stock.

Employee Welfare Plan

The Company provides various medical, dental, vision, life, accidental death and dismemberment, and long-term disability insurance benefits to all full-time employees who elect coverage under this program. The health plan is managed by a third-party administrator. Monthly employer and employee contributions are made to a tax-exempt employee benefits trust where the third-party administrator processes and pays claims. Stop-loss insurance coverage limits the Company’s risk of loss to $100 thousand for individual claims and $3.98 million aggregate claims. Expenses related to the health plan were $3.02 million in 2013, $2.25 million in 2012, and $3.49 million in 2011.

Deferred Compensation Plan

The Company maintains deferred compensation agreements with certain current and former officers that provide benefit payments, over various periods, commencing at retirement or death. Accrued benefits are based on the present values of expected payments and estimated life expectancies and totaled $455 thousand as of December 31, 2013, and $459 thousand as of December 31, 2012. Expenses related to the deferred compensation plan were $60 thousand in each of the three years ended December 31, 2013.

Supplemental Executive Retention Plan

The Company maintains the Supplemental Executive Retention Plan (the “SERP”) for key members of senior management. The domestic noncontributory, nonqualified SERP provides for a defined benefit, at normal retirement age, targeted at 35% of the participant’s projected final average compensation, subject to a defined maximum annual benefit. Benefits under the SERP generally become payable at age 62. The SERP is an unfunded plan; accordingly, there are no plan assets. The following table presents the components of the SERP’s net periodic pension cost in the periods indicated:


	Year Ended December 31,
(Amounts in thousands)	2013		2012		2011
Service cost	$	135	$	153	$	161
Interest cost		246		203		224
Amortization of losses (gains)		49		45		—
Amortization of prior service cost		187		134		134

Net periodic cost	$	617	$	535	$	519

The actuarial benefit plan obligation was $5.62 million as of December 31, 2013, and December 31, 2012. The obligation as of December 31, 2013, included a $380 thousand increase as a result of an amendment in January 2013 to revise the amount of normal retirement benefit. The increase was offset by a $725 thousand actuarial gain. The assumed discount rate was increased to 5.25% as of December 31, 2013, compared to 4.20% as of December 31, 2012. The following schedule presents the projected benefit payments to be paid under the SERP, by year, as of December 31, 2013:


(Amounts in thousands)
2014	$	246
2015		246
2016		246
2017		377
2018		377
2019 through 2023		2,171

Directors’ Supplemental Retirement Plan

The Company maintains the Directors’ Supplemental Retirement Plan (the “Directors’ Plan”) for non-management directors. The domestic noncontributory, nonqualified Directors’ Plan provides for a defined benefit, at normal retirement age, up to 100% of the participant’s highest consecutive three-year average compensation. Benefits under the Directors’ Plan generally become payable at age 70. The Directors’ Plan is an unfunded plan; accordingly, there are no plan assets. The following table presents the components of the Directors’ Plan’s net periodic pension cost in the periods indicated:


	Year Ended December 31,
(Amounts in thousands)	2013		2012		2011
Service cost	$	26	$	27	$	29
Interest cost		41		39		43
Amortization of gains (losses)		1		—		—
Amortization of prior service cost		90		90		90

Net periodic cost	$	158	$	156	$	162

The actuarial benefit plan obligation was $975 thousand as of December 31, 2013, and $981 thousand as of December 31, 2012. The assumed discount rate was increased to 5.25% as of December 31, 2013, compared to 4.20% as of December 31, 2012. The following schedule presents the projected benefit payments to be paid under the Directors’ Plan, by year, as of December 31, 2013:


(Amounts in thousands)
2014	$	83
2015		81
2016		79
2017		109
2018		107
2019 through 2023		552