Sec Form 4 Filing - Andrews Dennis Keith @ OTELCO INC. - 2004-12-21

FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person Andrews Dennis Keith 2. Issuer Name and Ticker or Trading Symbol OTELCO INC. [ OTT] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director _____ 10% Owner X __ Officer (give title below) _____ Other (specify below) Vice Pres, Regulatory Affairs (Last) (First) (Middle) P.O. BOX 130 3. Date of Earliest Transaction (MM/DD/YY) 12/21/2004 (Street) ARAB, AL35016 4. If Amendment, Date Original Filed (MM/DD/YY) 6. Individual or Joint/Group Filing (Check Applicable Line) __ X __ Form filed by One Reporting Person _____ Form filed by More than One Reporting Person (City) (State) (Zip)

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned 1.Title of Security (Instr. 3) 2. Transaction Date (MM/DD/YY) 2A. Deemed Execution Date, if any (MM/DD/YY) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Class A Common Stock 12/21/2004 C 2,799 A 2,799 D Class A Common Stock 12/21/2004 S 1,015 D $ 14.288 ( 2 ) 1,784 D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned ( e.g. , puts, calls, warrants, options, convertible securities) 1. Title of Derivative Security (Instr. 3) 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (MM/DD/YY) 3A. Deemed Execution Date, if any (MM/DD/YY) 4. Transaction Code (Instr. 8) 5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5) 6. Date Exercisable and Expiration Date (MM/DD/YY) 7. Title and Amount of Underlying Securities (Instr. 3 and 4) 8. Price of Derivative Security (Instr. 5) 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4) 11. Nature of Indirect Beneficial Ownership (Instr. 4) Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares Options ( 3 ) 12/21/2004 J( 4 ) 2,000 ( 5 ) ( 5 ) Income Deposit Securities 2,799 ( 3 ) 0 D Options ( 3 ) 12/21/2004 J( 4 ) 2,000 ( 6 ) ( 5 ) ( 5 ) Class B Common Stock 175 ( 3 ) 0 D Class B Common Stock ( 7 ) 12/21/2004 C 175 ( 7 ) ( 8 ) Income Deposit Securities 175 ( 9 ) 175 D Class B Common Stock ( 7 ) 12/21/2004 S 175 ( 7 ) ( 8 ) Income Deposit Securities 175 ( 10 ) 0 D

Reporting Owners Reporting Owner Name / Address Relationships Director 10% Owner Officer Other Andrews Dennis Keith P.O. BOX 130 ARAB, AL35016 Vice Pres, Regulatory Affairs Signatures /s/ Michael D. Weaver, Attorney-in-Fact 12/21/2004 Signature of Reporting Person Date

Explanation of Responses:

( 1 )The reported securities are included within 2,799 Income Deposit Securities ("IDSs"). Each IDS consists of one share of Class A common stock and one 13% senior subordinated note due 2019 with a $7.50 principal amount. ( 2 )This is the sale price of the IDSs set forth in the repurchase agreement relating to the sale of the IDSs. ( 3 )Exchange ratio of 1.39950 IDSs and 0.08750 shares of Class B common stock per option. ( 4 )Pursuant to an option exchange agreement, the options were exchanged for IDSs and Class B common stock in connection with the issuer's conversion from a limited liability company to a corporation. ( 5 )The options were exchanged for IDSs and Class B common stock on December 21, 2004, the closing date of the offering of the IDSs. ( 6 )These represent the same 2,000 options disposed of as shown in the line above. ( 7 )The Class B common stock will be exchangable for IDSs beginning on December 21, 2006, subject to the satisfaction of certain conditions, including a financial test set forth in an investor rights agreement. ( 8 )None. ( 9 )The Class B common stock will be exchangable for IDSs on a 1 for 1 basis, subject to adjustment. ( 10 )The Class B common stock was repurchased by the issuer for $14.288 per share of Class B common stock.

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).

** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).

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