v3.26.1
Related Party Transactions
 12 Months Ended
Dec. 31, 2025
Related Party Transactions [Abstract]  
Related Party Transactions Related Party Transactions
In the normal course of business, First Guaranty and its subsidiary, First Guaranty Bank, have loans, deposits and other transactions with its executive officers, directors, affiliates and certain business organizations and individuals with which such persons are associated. These transactions are completed with terms no less favorable than current market rates. An analysis of the activity of loans made to such borrowers during the year ended December 31, 2025 and 2024 follows:

 December 31,
(in thousands)20252024
Balance, beginning of year$48,013 $55,885 
Net (Decrease) Increase(10,931)(7,872)
Balance, end of year$37,082 $48,013 

Unfunded commitments to First Guaranty and Bank directors and executive officers totaled $17.6 million and $22.6 million at December 31, 2025 and 2024, respectively. At December 31, 2025 First Guaranty and the Bank had deposits from directors and executives totaling $93.0 million. There were no participations in loans purchased from affiliated financial institutions included in First Guaranty's loan portfolio in 2025 or 2024.

During the years ended 2025 and 2024, First Guaranty paid approximately $0.2 million and $0.3 million, respectively, for printing services and supplies and office furniture and equipment to Champion Industries, Inc., of which Mr. Marshall T. Reynolds, the Chairman of First Guaranty's Board of Directors, is President, Chief Executive Officer, Chairman of the Board of Directors and a major shareholder of Champion.

On December 21, 2015, First Guaranty issued a $15.0 million subordinated note (the "2015 Note") to Edgar Ray Smith III, a director of First Guaranty. The 2015 Note had a ten-year term (non-callable for first five years) and bore interest at a fixed annual rate of 4.0% for the first five years of the term and then adjusted to a floating rate based on the Prime Rate as reported by the Wall Street Journal plus 75 basis points for the period of time after the fifth year until redemption or maturity. On June 21, 2022, First Guaranty issued a $15.0 million subordinated note (the “2022 Note”) to Mr. Smith, and used the proceeds of such issuance to redeem the 2015 Note in full. The 2022 Note had a ten-year term (non-callable for the first five years) and bore interest at a floating rate based on the Prime Rate as reported by the Wall Street Journal plus 75 basis points. During the quarter ended June 30, 2025, First Guaranty entered into an Exchange Agreement under which the 2022 Note, due June 21, 2032, was exchanged for 1,981,506 shares of newly issued common stock. During 2024, First Guaranty paid interest of $1.4 million on the 2022 Note.

On March 28, 2024, First Guaranty issued a $30.0 million subordinated note (the "2024 Note") to Smith & Tate Investment, L.L.C., a company controlled by Edgar Ray Smith III, a director of First Guaranty. The 2024 Note has a ten-year term, maturing on March 28, 2034, is non-callable for the first five years, and bears interest at a floating rate based on the Prime Rate as reported by the Wall Street Journal plus 75 basis points. During the quarter ended June 30, 2025, First Guaranty entered into an amendment permitting interest to be paid in cash or common stock through March 31, 2026. On March 20, 2026, the note was further amended to extend this provision through March 31, 2028. During 2025, First Guaranty issued 248,122 shares as payment-in-kind interest on the 2024 Note. During 2024, First Guaranty paid interest of $1.9 million, on the 2024 Note.

First Guaranty has senior long-term debt (the "Senior Note") with Smith & Tate Investment, L.L.C., a company controlled by Edgar Ray Smith III, a director of First Guaranty. The note, refinanced in October 2023 and transferred to Smith & Tate in 2025, is priced at floating Wall Street Journal Prime less 50 basis points (6.75% as of December 31, 2025). The Senior Note totaled $14.2 million at December 31, 2025 and $15.2 million at December 31, 2024. This loan has a contractual maturity date of October 5, 2033. In the quarter ended June 30, 2025, the parties amended the note to waive principal payments and permit interest payments in cash or common stock through March 31, 2026. On March 20, 2026, the note was further amended to extend the waiver of principal payments and permit quarterly interest payments in cash or common stock through March 31, 2028. During 2025, First Guaranty paid $1.0 million of principal and $0.3 million of interest and issued 113,331 shares of common stock as payment-in-kind interest on the Senior Note.
During the years ended 2025 and 2024, First Guaranty paid approximately $7,000 and $63,000, respectively, for the purchase and maintenance of First Guaranty's automobiles to subsidiaries of Hood Automotive Group. Hood Automotive Group was led by William K. Hood, who served as a director of First Guaranty until his passing in 2025.
                                                                                                                                                                                                                             
During the years ended 2025 and 2024, First Guaranty paid approximately $0 and $9,300, respectively, for architectural services in relation to bank branches to Gasaway Gasaway Bankston Architects, of which bank subsidiary board member Andrew B. Gasaway is part owner.

During the years ended 2025 and 2024, First Guaranty paid approximately $0.8 million, respectively, to Centurion Insurance, an insurance brokerage agency, to bind coverage at market terms for property casualty insurance and health insurance. First Guaranty owns a 50% interest in Centurion and accounts for this investment under the equity method.

On June 28, 2024, the Bank consummated a sale-leaseback transaction relating to two stand-alone branches and a portion of the headquarters building which also contains a branch (collectively, the “Properties”). The Bank sold the Properties to a partnership owned by Marshall T. Reynolds, William K. Hood and Edgar R. Smith III, directors of First Guaranty, for an aggregate cash purchase price of $14.7 million. The Bank also agreed to lease the Properties back from this partnership. The sale-leaseback transaction resulted in a pre-tax gain of approximately $13.3 million, or $10.5 million after tax, during 2024. During the year ended 2025 and 2024, the Bank paid approximately $1.3 million and $0.6 million to the partnership pursuant to the leasing of the Properties.