Company: NSTS
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001437749-25-009831
Chunk: 1126

Company: NSTS Bancorp, Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 9A
Chunk 1126
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 ESOP. Generally, participants will receive distributions from the ESOP upon separation from service. The plan reallocates any unvested shares of common stock forfeited upon termination of employment among the remaining participants in the plan.
    
   ESOP compensation represents the average fair market value of the shares of Company common stock allocated or committed to be released as of that date. The difference between the market price and the cost of shares committed to be released is recorded as an adjustment to additional paid-in capital. Dividends, if any, on  allocated shares are recorded as a reduction of retained earnings and dividends, if any, on unallocated shares are recorded as a reduction of the debt service. The ESOP compensation expense for the year ended  December 31, 2024 and 2023 was $214,000 and $199,000.
    
   Shares held by the ESOP were as follows:

       As of December 31,  
   2024    2023  
   (Dollars in thousands)  
 Shares allocated   64,844   43,624 
 Shares distributed to plan participants   (1,597)  — 
 Unallocated   366,992   388,212 
 Total ESOP shares   430,239   431,836 
         
 Fair value of unearned shares as of December 31, 2024 and December 31, 2023 respectively  $4,331  $3,692 

       72

   Equity Incentive Plan
    
   At the Company's annual meeting of stockholders held on  May 24, 2023, stockholders approved the NSTS Bancorp, Inc. 2023 Equity Incentive Plan (“2023 Equity Plan”), which provides for the granting of up to 755,714 shares (215,918 shares of restricted stock and 539,796 shares available for future grants of stock options) of the Company’s common stock pursuant to equity awards made under the 2023 Equity Plan.
    
   Stock options granted under the 2023 Equity Plan generally vest in equal annual installments over a service period of five years beginning on the date of grant. The vesting of the options accelerates upon death, disability or following a change in control of the Company. Stock options are generally granted at an exercise price equal to the fair value of the Company’s common stock on the grant date based