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Note 6 - Long-term Debt
 12 Months Ended
Dec. 31, 2024
Notes to Financial Statements  
Debt Disclosure [Text Block]

6.

LONG-TERM DEBT

 

On December 23, 2021, the Company executed a Fourth Loan Modification Agreement and Second Amended and Restated Credit Agreement (“Agreements”) extending the maturity date of the $15.0 million revolving line of credit facility with First Hawaiian Bank (“Credit Facility”) to December 31, 2025. The Agreements provide revolving or term loan borrowing options. Interest on revolving borrowing is calculated based on the Bank’s prime rate minus 1.125 percentage points. Interest on term loan borrowing is fixed at the Bank’s commercial loan rates with interest rate swap options available. The Company has pledged approximately 30,000 square feet of commercial leased space in the Kapalua Resort as security for the Credit Facility. Net proceeds from the sale of any collateral are required to be repaid toward outstanding borrowings and will permanently reduce the Credit Facility’s revolving commitment amount. There are no commitment fees on the unused portion of the Credit Facility.

 

At December 31, 2024, $12.0 million was available from our Credit Facility, as the Company borrowed $3,000,000 during the year ended December 31, 2024. 

 

The terms of the Credit Facility include various representations, warranties, affirmative, negative and financial covenants and events of default customary for financings of this type. Financial covenants include a minimum liquidity (as defined) of $2.0 million, a maximum of $45.0 million in total liabilities, and a limitation on new indebtedness. The Credit Facility also contains covenants restricting the payment of cash dividends without the lender’s prior approval.

 

The Company was in compliance with the covenants under the Credit Facility as of December 31, 2024.

 

In July 2024 the Company took out a loan to finance equipment purchases. The loan carried a principal amount of $338,720, 0% interest rate and a monthly payment of $7,057. The loan matures in July of 2028.

 

At December 31, 2024, long-term debt principal payments and imputed interest on this 0% loan for the next four years to maturity are as follows:

 

Years ending December 31,

 

2025

 $85 

2026

  85 

2027

  85 

2028

  49