NOTE (10) – ESOP Plan

Employees participate in an Employee Stock Ownership Plan (“ESOP”) after attaining certain age and service requirements. In December 2016, the ESOP purchased 1,493,679 shares of the Company’s common stock at $1.59 per share, for a total cost of $2.4 million, of which $1.2 million was funded with a loan from the Company. The loan will be repaid from the Bank’s annual discretionary contributions to the ESOP, net of dividends paid, over a period of 20 years. Shares of the Company’s common stock purchased by the ESOP are held in a suspense account until released for allocation to participants. When loan payments are made, shares are allocated to each eligible participant based on the ratio of each such participant’s compensation, as defined in the ESOP, to the total compensation of all eligible plan participants. As the unearned shares are released from the suspense account, the Company recognizes compensation expense equal to the fair value of the ESOP shares during the periods in which they become committed to be released. To the extent that the fair value of the ESOP shares released differs from the cost of such shares, the difference is charged or credited to equity as additional paid-in capital. Any dividends on allocated shares increase participant accounts. Any dividends on unallocated shares will be used to repay the loan. Participants will receive shares for their vested balance at the end of their employment. Compensation expense related to the ESOP was $19 thousand for both the three months ended September 30, 2019 and 2018, and was $47 thousand and $67 thousand for the nine months ended September 30, 2019 and 2018, respectively.

Shares held by the ESOP were as follows:


	September 30, 2019		December 31, 2018
	(Dollars in thousands)

Allocated to participants		999,467		1,036,809
Committed to be released		42,321		10,580
Suspense shares		614,292		646,033
Total ESOP shares		1,656,080		1,693,422
Fair value of unearned shares	$	946	$	678

The Company received ESOP loan payments of $83 thousand and $84 thousand during September of 2019 and 2018, respectively. The outstanding balance of unearned shares was $977 thousand and $1.1 million at September 30, 2019 and December 31, 2018, respectively, which are shown as Unearned ESOP shares in the equity section of the consolidated statements of financial condition.