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Line of Credit and Long-term Debt
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
Line of Credit and Long-term Debt

9. LINE OF CREDIT AND LONG-TERM DEBT

 

 

 

Balance outstanding as of December 31,

 

 

 

2024

 

 

2023

 

Term Loan - ("FCC Loan") - repayable by monthly principle of payments of $164 and accrued interest at Secured Overnight Financing Rate ("SOFR") plus an applicable margin per annum (8.12% at December 31, 2024); matures May 3, 2027

 

$

20,821

 

 

$

22,788

 

Term Loan - Pure Sunfarms - C$19.0M - Canadian prime interest rate plus an applicable margin (7.45% as of December 31, 2024), repayable in quarterly payments equal to 2.50% of the outstanding principal amount, matures February 7, 2026

 

 

6,262

 

 

 

8,298

 

Term loan - Pure Sunfarms - C$25.0M - Canadian prime interest rate plus an applicable margin (7.45% as of December 31, 2024), repayable in quarterly payments equal to 2.50% of the outstanding principal amount, matures February 7, 2026

 

 

10,436

 

 

 

13,201

 

BDC Facility - Pure Sunfarms - non-revolving demand loan repayable by monthly principal payments of C$52 and accrued interest at Canadian prime interest rate plus an applicable margin (9.20% at December 31, 2024), matures December 31, 2031

 

 

3,043

 

 

 

3,771

 

Total

 

$

40,562

 

 

$

48,058

 

As collateral for the FCC Loan, the Company has provided promissory notes and a first priority security interest over its accounts receivable and inventory. In addition, the Company has granted full recourse guarantees and security therein. The carrying value of the assets and securities pledged as collateral for the FCC Loan as of December 31, 2024 and 2023 was $77,682 and $114,293, respectively.

The PSF Non-Revolving Facility is secured by the Delta 2 and Delta 3 greenhouse facilities and contains customary financial and restrictive covenants.

The Company has a revolving line of credit agreement with a Canadian chartered bank (the "Operating Loan") maturing February 2027. The Operating Loan can be drawn in advances of up to C$10,000, had an outstanding balance of $4,000 drawn on the facility as of December 31, 2024 and December 31, 2023, and future availability of $2,931 on December 31, 2024. Interest under the Operating Loan is payable at the Canadian prime rate plus an applicable margin per annum (8.02% at December 31, 2024), payable monthly.

The carrying value of the assets pledged as collateral for the Operating Loan as of December 31, 2024 and 2023 was $27,136 and $28,034, respectively.

Pure Sunfarms has a revolving line of credit (the “PSF Revolving Line of Credit”) with a Canadian chartered bank. The PSF Revolving Line of Credit can be drawn for advances of up to C$15,000 and had an outstanding balance of $0 as of December 31, 2024 and December 31, 2023. Interest under the PSF Revolving Line of Credit is payable at the Canadian prime rate plus an applicable margin per annum (7.45% at December 31, 2024), payable monthly.

The Company is required to comply with financial covenants, measured either quarterly or annually depending on the covenant. The Company was not in compliance with financial covenants related to the fixed charge coverage ratio under the FCC Loan and the Pure Sunfarm's Term Loans, for which it received waivers. The covenants will be reinstated at the end of the first quarter for the Pure Sunfarm's Term Loans and at the end of the fiscal year 2025 for the FCC loan. Management expects to regain compliance during the next testing period. FCC measures the Company's financial covenants once a year on the last day of the year and the Pure Sunfarm's Term Loan covenants are measured once a quarter on the last day of the quarter.

Village Farms was in compliance with all of its remaining covenants under its other credit facilities.

The weighted average interest rate on short-term borrowings as of December 31, 2024 and 2023 was 8.22% and 9.44%, respectively.

Accrued interest payable on all long term-debt as of December 31, 2024 and 2023 was $271 and $390, respectively, and these amounts are included in accrued liabilities in the consolidated statements of financial position.

The aggregate annual principal maturities of long-term debt for the next five years and thereafter are as follows:

 

2025

 

$

5,533

 

2026

 

 

15,969

 

2027

 

 

17,321

 

2028

 

 

435

 

2029

 

 

435

 

Thereafter

 

 

869

 

 

$

40,562