Under the 2002 Equity Incentive Stock Option Plan and the 2006 Stock Incentive Plan, employees are eligible to receive options to purchase shares of common stock at the fair market value on the date the option is granted. Each grant vests over a three -year period and will expire no later than ten years from the date of the grant. The 2002 Equity Incentive Stock Option Plan expired October 28, 2012.  The 2006 Stock Incentive Plan also provides for stock -based incentives in the form of stock appreciation rights, restricted stock and deferred stock awards up to 100, 000 shares.  The weighted average grant -date calculated value of options granted in 2013 and 2012 was $ 3. 02 and $ 3. 00 ,  respectively. The calculated value of the options awarded under the option plans is estimated on the date of grant using the Black - Scholes valuation model, which is dependent upon certain assumptions as presented below:  The expected life of the options was estimated using the average vesting period of the options granted and represents the period of time that options granted are expected to be outstanding.  The risk -free interest rate is the U. S. Treasury rate commensurate with the expected life of the options on the grant date. Volatility of the Company’ s stock price in 2013 and 2012 was based on historical volatility of the NASDAQ Bank Index.  Information regarding the Company’ s stock option plans for the year ended December 31, 2013 is as follows (dollars in thousands, except exercise prices):  33 Options outstanding,  January 1,  2013 Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Shares Price Life Value Options January 1,  2013 77, 260 $  10. 83 5. 0 years $  55 Options granted 8, 250 11. 00 Options exercised 2, 470)  8. 00 Options forfeited 4, 194)  8. 00 Options Outstanding,  December 31, 2013 78, 846 $  11. 09 4. 9 years $  35 Options Exercisable,  December 31, 2013 55, 926 $  11. 12 3. 5 years $  35 December 31,  2013 2012 Expected life (in years)  7 7 Risk -free interest rate 1. 23 %  1. 38 Expected volatility 23. 22 %  22. 55 Expected dividend yield - % - 