Employee Stock Ownership Plan

The Company’s ESOP was established in 2000. The plan is a leveraged ESOP in which the Company is the lender. The loans are repaid from the Company’s discretionary plan contributions over the original 15 year term with a variable rate of interest. The annual interest rate was 1.99% at June 30, 2016, which is updated on a quarterly basis.

Shares are held by the plan trustee for allocation among participants as the loan is repaid. The unencumbered shares are allocated to participants using a compensation-based formula. Subject to vesting requirements, allocated shares are owned by participants and shares are held by the plan trustee until the participant retires.

Historically, the Company used the dividends, if any, on ESOP shares to pay down the loans, and allocated to the ESOP participants shares equivalent to the fair market value of the dividends they would have received. No dividends were paid in fiscal 2016, 2015 or 2014.

During the fiscal years ended June 30, 2016, 2015 and 2014, the Company charged $3.4 million, $4.4 million and $3.3 million, respectively, to compensation expense related to the ESOP. The decrease in ESOP expense in fiscal 2016 is primarily due to the reduction in the number of shares being allocated to participant accounts as a result of paying down the loan amount. The increase in ESOP expense in fiscal 2015 as compared to fiscal 2014 was due to the increase in the fair market value of the Company's shares which determines the ESOP expense recorded. The difference between cost and fair market value of committed to be released shares, which was $36,000, $1.0 million and $0.3 million for the fiscal years ended June 30, 2016, 2015 and 2014, respectively, is recorded as additional paid-in capital.



	June 30,
	2016		2015
Allocated shares	1,941,934		1,970,117
Committed to be released shares	169,603		172,398
Unallocated shares	220,925		390,528
Total ESOP shares	2,332,462		2,533,043

(In thousands)
Fair value of ESOP shares	$	74,779	$	59,527

As of and for the years ended June 30,

Loan amount (in thousands)