NOTE 19 – Employee Stock Ownership Plan

The Company maintains a leveraged employee stock ownership plan (“ESOP”) that covers substantially all employees. The ESOP was established in conjunction with the Company’s stock offering completed in October 2017 and operates on a plan year ending December 31. The loan to fund the acquisition of stock by the ESOP was made by the Company. The Bank makes annual contributions to the ESOP equal to the ESOP’s debt service. The ESOP shares initially were pledged as collateral for this debt. As the debt is repaid, shares are released from collateral and allocated to active participants, based on the proportion of debt service paid in the year. Because the debt is intercompany, it is eliminated in consolidation for presentation in these financial statements. The shares pledged as collateral are reported as unearned ESOP shares in the balance sheet.

As shares are committed to be released from collateral and allocated to active participants, the Company reports compensation expense equal to the current market price of the shares and the shares will become outstanding for earnings-per-shares (EPS) computations. During the years ended December 31, 2019 and 2018, 12,960 shares were committed to be released. During the year ended December 31, 2019 the average fair value per share of stock was $10.62 resulting in total ESOP compensation expense of $138 for the year ended December 31, 2019. During the year ended December 31, 2018 the average fair value per share of stock was $11.03 resulting in total ESOP compensation expense of $143 for the year ended December 31, 2018. The ESOP shares as of December 31 were as follows:


	2019		2018
Shares allocated to active participants		15,907		2,947
Shares committed to be released and allocated to participants		12,960		12,960
Total unallocated shares		230,343		243,303
Total ESOP shares		259,210		259,210
Fair value of unallocated shares (based on $11.55 and $10.03 share price at December 31, 2019 and 2018, respectively)	$	2,660	$	2,440