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Long-Term Debt
6 Months Ended
Jun. 30, 2021
Long-Term Debt  
Long-Term Debt

5.           Long-Term Debt

    

June 30, 

    

December 31, 

2021

2020

($000’s omitted)

Paycheck protection program payable to financial institutions: Interest rate of 1% per annum. Unforgiven portion is payable monthly until April 20, 2022 (A)

$

4,000

$

4,000

Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 2.15000% (B)(C)

4,250

3,750

Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.492130%, monthly principal payments of $21,833 through 2021 with a balloon payment of $286,000 due December 1, 2021(C).

417

1,048

 

 

  

Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.492130%, monthly principal payments of $23,810, maturity date December 1, 2021(C).

 

143

 

286

Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.795530% - 1.835015% as of June 30, 2021)(D)

 

819

 

534

Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/ factor 1.822758% - 1.869304% at time of funding)(E)

232

310

 

9,861

 

9,928

Less current portion

 

(4,936)

 

(2,635)

$

4,925

$

7,293

A.)On April 21, 2020, the Company executed a promissory note (the "Note") in the amount of $4,000,000 as part of the Paycheck Protection Program (the “PPP Loan”) administered by the Small Business Administration (the "SBA") and authorized under the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act"). The PPP Loan is being made through the Bank of America, NA (the "Lender"). The term of the PPP Loan is two years with an annual interest rate of 1.00%. Payments of principal and interest on the PPP Loan will be deferred on the unforgiven amount, if any, until the date on which loan forgiveness is determined. On August 4, 2021, the Company submitted a PPP Loan forgiveness application to the Lender. The Lender has 60 days to review and process the forgiveness application. When the Lender has completed its review, they are required to notify the SBA regarding their determination of whether all or a portion of the PPP loan may be forgiven. The SBA has 90 days from receipt to approve or reject the forgiveness application. As of the date of this filing, the Company has not received any determination of approval of its application from the Lender or the SBA. The Company has elected to account for the PPP Loan under ASC 470 “Debt” and will record the forgiveness, as applicable, when notified by the SBA.
B.)The Company has a $6,000,000 line of credit. The interest rate is a rate per year equal to the bank’s prime rate or Libor plus 2.15%. In addition, the Company is required to pay a commitment fee of 0.25% on the unused portion of the line of credit.  The line of credit expires December 21, 2022.  There was $4,250,000 balance outstanding at June 30, 2021 and $3,750,000 balance at December 31, 2020.
C.)The term loans and line of credit are secured by all personal property of the Company with the exception of certain equipment that was purchased from proceeds of government grants.  Certain lenders require the Company to comply with debt covenants as described in the specific loan documents, including a debt service ratio. At June 30, 2021 and December 31, 2020 the Company was in compliance with these covenants.
D.)The Company has an equipment loan facility in the amount of $1,000,000 available until July 9, 2021. This line is non-revolving and non-renewable. The loan term for the equipment covered by the agreement is 60 months.  Monthly payments are fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding.  During the six months ended June 30, 2021, approximately $384,500 was drawn on this facility.  There was approximately $819,000 outstanding at June 30, 2021 and $534,000 balance outstanding at December 31, 2020.
E.)The Company established a lease line of credit for equipment financing in the amount of $1,000,000 available until June 28, 2018. This line was non-revolving and non-renewable. The lease term for equipment covered by the lease line of credit is 60 months.  Monthly payments are fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding.  There was approximately $232,000 outstanding at June 30, 2021 and $310,000 at December 31, 2020.

Principal maturities of long-term debt are as follows:  2021 - $2,754,000; 2022 - $6,614,000; 2023 - $231,000; 2024 - $178,000; and 2025 and beyond - $84,000.  Remaining principal payments and interest payments for the capital note and capital equipment financing lease obligations for each of the next five years:

    

    

June 30, 

    

December 31, 

Year

2021

2020

($000’s omitted)

 

2021

$

230

 

$

331

 

2022

393

 

316

 

2023

246

 

169

 

2024

188

 

112

 

2025+

90

 

Total principal and interest payments

 

1,147

 

928

Less amount representing interest

 

(96)

 

(83)

Present value of net minimum lease payments

 

1,051

 

845

Less current portion

 

(376)

 

(301)

Long-term principle payments

$

675

$

544