Note 10 - Other Long-term Debt

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Long-term Debt [Text Block]

NOTE 1 0 : Other Long-Term Debt

Other long-term debt consisted of the following:

	December 31,
	2019					2018
			Unamortized					Unamortized
			Debt					Debt
	Principal		Issuance			Principal		Issuance
	Amount		Costs			Amount		Costs
	(In Thousands)
Senior notes fixed at 5.75%, due 2022	$	10,000	$	(92	)	$	10,000	$	(136	)
Subordinated debentures fixed at 6.75%, due 2025		10,000		(122	)		10,000		(143	)
Subordinated debentures variable at 3-Month Libor plus 1.42%, due 2035		5,155		-			5,155		-
Total other long-term debt	$	25,155	$	(214	)	$	25,155	$	(279	)

In

February 2017,

the Company completed the issuance, through a private placement, of

$10,000,000

aggregate principal amount of

5.75%

fixed senior unsecured notes due in

2022.

The interest will be paid semi-annually through maturity date. The notes are

not

subject to redemption at the option of the Company.

In

June 2015,

the Company completed the issuance of

$10,000,000

in aggregate principal amount of subordinated notes due in

2025

in a private placement transaction to an institutional accredited investor. The notes will bear interest at an annual fixed rate of

6.75%

and interest will be paid quarterly through maturity date or earlier redemption. The notes are subject to redemption at the option of the Company on or after

June 19, 2020.

The subordinated debentures qualify as Tier

2

capital for regulatory capital purposes.

In

September 2005,

the Company completed the private placement of

$5,155,000

in subordinated debentures to the Trust. The Trust funded the purchase of the subordinated debentures through the sale of trust preferred securities to First Tennessee Bank, N.A. with a liquidation value of

$5,155,000.

Using interest payments made by the Company on the debentures, the Trust began paying quarterly dividends to preferred security holders on

December 15, 2005.

The annual percentage rate of the interest payable on the subordinated debentures and distributions payable on the preferred securities was fixed at

6.02%

until

December 2010

then became variable at

3

-Month LIBOR plus

1.42%,

making the rate

3.328%

and

4.228%

as of

December 31, 2019

and

2018,

respectively. Dividends on the preferred securities are cumulative and the Trust

may

defer the payments for up to

five

years. The preferred securities mature in

December 2035

unless the Company elects and obtains regulatory approval to accelerate the maturity date. The subordinated debentures qualify as Tier

1

capital for regulatory capital purposes.

For

2019

and

2018,

interest expense on all other long-term debt was

$1,446,000

and

$1,432,000,

respectively.