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Employee Benefits
 12 Months Ended
Dec. 31, 2020
Employee Benefits  
Employee Benefits

NOTE 19 Employee Benefits

The Company maintains two employee retirement plans including the Alerus Financial Corporation Employee Stock Ownership Plan, or ESOP, and a defined contribution salary reduction plan, or 401k. The plans cover substantially all full-time employees upon satisfying prescribed eligibility requirements for age and length of service. Contributions to the ESOP are determined annually by the Board of Directors, at its discretion, and allocated to participants based on a percentage of annual compensation. Shares of the Company stock within the ESOP are considered outstanding and dividends on these shares are charged to retained earnings. Under the 401k, the Company contributes 100% of amounts deferred by employees up to 3% of eligible compensation and 50% of amounts deferred by employees between 3% and 6% of eligible compensation. Retirement plan contributions are reflected under employee benefits in the income statement and for years ending December 31, 2020, 2019, and 2018 were as follows:

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​

​

​

​

​

​

​

​

​

​

​

​

December 31, 

​

December 31, 

​

December 31, 

(dollars in thousands)

    

2020

    

2019

    

2018

Salary reduction plan

​

$

2,960

​

$

2,599

​

$

2,402

ESOP

​

 

2,166

​

 

1,836

​

 

1,665

Total

​

$

5,126

​

$

4,435

​

$

4,067

Total ESOP shares outstanding

​

 

1,170,611

​

 

1,307,439

​

 

1,334,372

​

Prior to the Company’s initial public offering, in accordance with provisions of the Internal Revenue Code of 1986, as amended, or the Code, that are applicable to private companies, the terms of the ESOP provided that ESOP participants had the right, for a specified period of time, to require us to repurchase shares of our common stock that were distributed to them by the ESOP. As a result, the ESOP-owned shares were deducted from total stockholders’ equity in our consolidated balance sheets. The shares of common stock held by the ESOP are reflected in our consolidated balance sheets as a line item called “ESOP-owned shares” appearing between total liabilities and stockholders’ equity. Upon the completion of our initial public offering and the listing of our common stock on the

Nasdaq Capital Market, in September 2019, our repurchase liability was extinguished and the ESOP-owned shares are now included in total stockholders’ equity.