Company: NODK
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001174947-25-001356
Chunk: 392

Company: NI Holdings, Inc.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 8
Chunk 392
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 trust (the “ESOP Trust”). The ESOP loan was for a period of ten years, bearing interest at the long-term
Applicable Federal Rate effective on the closing date of the offering (2.79% annually). The ESOP Trust used the proceeds of the loan to
purchase shares in our IPO, which resulted in the ESOP Trust owning approximately 1.0% of the Company’s authorized shares. The ESOP
has purchased the shares for investment and not for resale.

The shares purchased by the ESOP Trust in the offering are held
in a suspense account as collateral for the ESOP loan. Nodak Insurance makes semi-annual cash contributions to the ESOP in amounts no
smaller than the amounts required for the ESOP Trust to make its loan payments to Nodak Insurance. While the ESOP makes two loan payments
per year, a pre-determined portion of the shares are released from the suspense account and allocated to participant accounts at the end
of the calendar year. This release and allocation occurs on an annual basis over the ten-year term of the ESOP loan. Nodak Insurance has
a lien on the shares of common stock of the Company held by the ESOP to secure repayment of the loan from the ESOP to Nodak Insurance.
If the ESOP is terminated as a result of a change in control of the Company, the ESOP may be required to pay the costs of terminating
the plan.

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It is anticipated that the only assets held by the ESOP will be
shares of the Company’s common stock. Participants in the ESOP cannot direct the investment of any assets allocated to their accounts.
The ESOP participants are employees of Nodak Insurance. The employees of Primero, Direct Auto, and Westminster do not participate in the
ESOP.

Each employee of Nodak Insurance automatically becomes a participant
in the ESOP if such employee is at least 21 years old, has completed a minimum of one thousand hours of service with Nodak Insurance,
and has completed an Eligibility Computation Period. Employees are not permitted to make any contributions to the ESOP. Participants in
the ESOP receive annual reports from the Company showing the number of shares of common stock of the Company allocated to the participants’
accounts and the market value of those shares. The shares are allocated to participants based on compensation as provided for in the ESOP.

In connection with the establishment of the ESOP, the Company created
a contra-equity