Company: BCTF
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0001552781-25-000058
Chunk: 169

Company: Bancorp 34, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1
Chunk 169
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ordinated notes initially bear interest
at 4.00% per annum for five years, floating at Three-Month SOFR plus 328 basis points quarterly thereafter. The ten-year notes mature
on July 15, 2031, and are callable at the Company’s option after five years. The subordinated notes have unamortized origination
fees of $351,000 at December 31, 2024. As part of the Merger with CBOA, $1.5 million of the subordinated debt was acquired in the transaction
and subsequently retired.

As part of the Merger with CBOA, the Company
acquired CBOA Financial Statutory Trust #1, a trust formed by CBOA in November 2005. The trust closed a pooled private offering of 5,000
trust preferred securities with a liquidation amount of $1,000 per security. CBOA made a required equity contribution of $155,000 to
form the trust and issued $5 million of subordinated debentures to the trust in exchange for ownership of all of the common securities
of the trust and the proceeds of the preferred securities sold by the trust. The Company is able to redeem the subordinated debentures,
in whole or in part, in a principal amount with integral multiples of $1,000, at 100% of the principal amount, plus accrued and unpaid
interest until maturity in 2036. The subordinated debentures are also redeemable in whole or in part from time to time, upon the occurrence
of specific events defined within the trust indenture. Bancorp 34 has the option to defer interest payments on the subordinated debentures
from time to time, for a period not to exceed five consecutive years. Bancorp 34 has elected not to defer interest payments on the subordinated
debentures. The trust preferred securities have a variable rate of interest, reset quarterly on the 23rd of each February, May, August,
and November, equal to the sum of 3-month CME term SOFR plus 1.70%. As of December 31, 2024, the rate was 6.48%. Bancorp 34’s investment
in the common stock of the trust is $155,000, which is included in other investments and is accounted for as an unconsolidated cost-method
investment. Bancorp 34 is not considered the primary beneficiary of this trust, and therefore the trust