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Employee Stock Ownership Plan | 6 Months Ended
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Dec. 31, 2021
Employee Stock Ownership Plan [Abstract] |
Employee Stock Ownership Plan | Note 8. Employee Stock Ownership Plan The Company sponsors a leveraged employee stock ownership plan (the “ESOP”) that covers all nonunion employees who work 1,000 or more hours per year and are employed on June 30. Prior to December 1, 2020, the ESOP owned 469,119 shares, all of which were allocated to employees. On December 1, 2020, pursuant to a Stock Purchase Agreement dated as of such date, the Company, by selling 300,000 shares of its common stock, par value $0.33 1/3 per share, to the Espey Mfg. & Electronics Corp. Employee Stock Ownership Plan Trust, provided more shares to be allocated to employees for services rendered over the next 15 years. The ESOP paid $18.29 per share, for an aggregate purchase price of $5,487,000. The determination of the purchase price was based on a fairness opinion obtained by an independent valuation firm. The ESOP borrowed from the Corporation an amount equal to the purchase price. The loan will be repaid in fifteen (15) equal annual installments of principal. The Board of Directors has fixed the interest rate and the unpaid balance will bear interest at a fixed rate of 3.00% per annum. The Board of Directors of the Company had approved a purchase price per share equal to the lesser of the trading value on the day of closing or the lowest price listed in the valuation established by the independent valuation firm plus $0.25. The valuation identified a range of $18.04 - $19.43 per share. In making the sale, the Company relied on the exemption from registration under Section 4(2) of the Securities Act of 1933, as amended, because the shares sold were offered only to the ESOP. After giving effect to the transaction, the ESOP owned 769,119 shares of the Company's 2,702,633 outstanding shares of common stock as of December 1, 2020. The Company makes annual contributions to the ESOP equal to the ESOP's debt service less dividends on unallocated shares received by the ESOP. Any dividends on unallocated shares received by the ESOP are used to pay debt service. Any dividends on allocated ESOP shares are recorded as a reduction of retained earnings. As the debt is repaid, shares are released and allocated to active employees, based on the proportion of debt service paid in the year. The Company accounts for its ESOP in accordance with FASB ASC 718-40. Accordingly, the shares purchased by the ESOP are reported as Unearned ESOP shares in the balance sheets and the statements of changes in stockholders’ equity. As shares are released or committed-to-be-released, the Company reports compensation expense equal to the current average market price of the shares, and the shares become outstanding for earnings-per-share (EPS) computations. ESOP compensation expense was $83,812 and $56,274 for the three-month periods ended December 31, 2021 and 2020, respectively. ESOP compensation expense was $168,318 and $56,274 for the six-month periods ended December 31, 2021 and 2020, respectively. 12 Index The ESOP shares as of December 31, 2021 and 2020 were as follows:
|  | December 31, 2021 |  |  | December 31, 2020 |
Allocated shares |  |  | 478,935 |  |  |  | 468,663 |
Committed-to-be-released shares |  |  | 11,568 |  |  |  | 2,939 |
Unreleased shares |  |  | 267,861 |  |  |  | 297,061 |
Total shares held by the ESOP |  |  | 758,364 |  |  |  | 768,663 |
Fair value of unreleased shares |  | $ | 3,806,305 |  |  | $ | 5,620,394 |
The Company may at times be required to repurchase shares at the ESOP participants’ request at the shares’ fair market value. During the three and six months ended December 31, 2021 and 2020, the Company did not repurchase shares previously held by the ESOP. The ESOP allows for eligible participants to take whole share distributions from the Plan on specific dates in accordance with the provision of the Plan. Share distributions from the ESOP during the six months ended December 31, 2021 and 2020 totaled 8,285 and 456 shares, respectively.

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