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Note 9 - Debt

6 Months Ended

Jul. 03, 2022

(9)

Debt

Debt outstanding consists of the following (in thousands):

	July 3,			December 31,
	2022			2021
	(Unaudited)
Current:
Finance lease obligation, current portion	$	1,016		$	983
Equipment financing obligations, current portion		347			336
Note payable – related party, current portion		2,500			0
Current portion of long term debt and finance lease obligations	$	3,863		$	1,319
Long Term:
Finance lease obligation	$	2,957		$	3,469
Equipment financing obligations		692			868
Note payable – related party		4,000			6,500
Less unamortized debt issuance and modification costs		(13	)		(16	)
Long term debt and finance lease obligations net of unamortized debt costs	$	7,636		$	10,821

Note Payable – Related Party

The Company has received the benefit of cash infusions from Gill Family Capital Management, Inc. (“GFCM”) in the form of secured promissory note obligations totaling $6,500,000 in principal as of July 3, 2022 and December 31, 2021. GFCM is an entity controlled by the Company’s Chairman, President and Chief Executive Officer, Jeffrey T. Gill, and one of our directors, R. Scott Gill. GFCM, Jeffrey T. Gill and R. Scott Gill are significant beneficial stockholders of the Company. As of July 3, 2022, our principal commitment under the Note was $2,500,000 due on April 1, 2023, $2,000,000 on April 1, 2024 and the balance on April 1, 2026. Interest on the promissory note is reset on April 1 of each year, at the greater of 8.0% or 500 basis points above the five-year Treasury note average during the preceding 90-day period, in each case, payable quarterly. The note allows for up to an 18-month deferral of payment for up to 60% of the interest due on the portion of the notes maturing in April of 2023 and 2024.

Obligations under the promissory note are guaranteed by all of the subsidiaries and are secured by a first priority lien on substantially all assets of the Company, including those in Mexico.

Finance Lease Obligations

As of July 3, 2022, the Company had $3,973,000 outstanding under finance lease obligations for both property and machinery and equipment at its Sypris Technologies locations with maturities through 2026 and a weighted average interest rate of 8.5%.

Equipment Financing Obligations

As of July 3, 2022, the Company had $1,039,000 million outstanding under equipment financing facilities, with effective interest rates ranging from 4.4% to 8.1% and payments due through 2026. Payments on the Company’s equipment financing obligations are due as follows (in thousands):

Next 12 months	$	403
12 to 24 months		376
24 to 36 months		254
36 to 48 months		90
48 to 60 months		23
Thereafter		0
Total payments		1,146
Less imputed interest		(107	)
Total equipment financing obligations	$	1,039