SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2020

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

On October 14, 2020, the Company entered into Subordinated Note Purchase Agreements (collectively, the "Purchase Agreements'') with qualified institutional buyers and accredited investors (collectively, the "Purchasers") pursuant to which the Company issued and sold $20.0 million in aggregate principal amount of its 4.75% Fixed to Floating Rate Subordinated Notes due 2030 (the "Notes"). The Notes were sold by the Company in a private offering. The Notes mature on October 15, 2030 and bear interest at a fixed rate of 4.75% to October 14, 2025. From October 15, 2025 to the maturity date or early redemption date, the interest rate will reset quarterly to an interest rate per annum, expected to be the then-current-three-month Secured Overnight Financing Rate ("SOFR") provided by the Federal Reserve Bank of New York plus 458 basis points. The Company may redeem the Notes at any time after October 14, 2025, and at any time in whole, but not in part, upon the occurrence of certain events. Any redemption of the Notes will be subject to prior regulatory approval. The Company estimates the debt issuance costs for placement fees, legal and other out-of-pocket expenses to be in the range of $475,000 to $525,000.

On October 14, 2020, in connection with the issuance of the Notes, the Company entered into Registration Rights Agreements (the "Registration Rights Agreements") with the Purchasers. In the Registration Rights Agreements, the Company has agreed to take actions to provide for the exchange of the Notes for subordinated notes that are registered under the Securities Act and have substantially the same terms as the Notes (the "Exchange Notes"). Under certain circumstances, if the Company fails to meet its obligations under the Registration Rights Agreement, it would be required to pay additional interest to the holders of the Notes.

The Notes were issued under an indenture, dated October 14, 2020, by and between the Company and UMB Bank National Association , as trustee. The Notes are not subject to any sinking fund and are not convertible into or, other than the Exchange Notes, exchangeable for any other securities or assets of the Company or any of its subsidiaries. The Notes are not subject to redemption at the option of the holders. The Notes are unsecured, subordinated obligations of the Company only and are not obligations of, and are not guaranteed by, any subsidiary of the Company. The Notes rank junior in right to payment to the Company's current and future indebtedness. The Notes qualify as Tier 2 capital for regulatory capital purposes for the Company.

On October 15, 2020, the Company contributed $10.0 million of net proceeds from the Subordinated Notes offering to the Bank as Tier 1 Capital.

On October 20, 2020, the Company’s Board of Directors approved an expansion to the 2015 stock repurchase plan (the "2020 repurchase plan"). Before the Board's October 20, 2020 action, the Company had authorization to repurchase up to 184,863 shares of the Company’s common stock pursuant the stock repurchase plan previously adopted by the Board on May 4, 2015. After the Board’s action, the Company may repurchase up to 300,000 of the Company’s outstanding shares of common stock using up to $7.0 million of the proceeds the Company raised in the Notes offering.