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LONGTERM DEBT | 9 Months Ended
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Sep. 30, 2021
LONGTERM DEBT |
NOTE 15 - LONG-TERM DEBT | NOTE 15 — LONG-TERM DEBT Long-term debt consists of the following:
|  | Outstanding Balance |  |  |  |  |  |  |
|  | September 30, |  |  | December 31, |  |  | Current |  |  |  |
|  | 2021 |  |  | 2020 |  |  | Interest Rate |  |  | Maturity |
DGSE |  |  |  |  |  |  |  |  |  |  |  |
Note payable, related party (1) |  | $ | 2,796,449 |  |  | $ | 2,863,715 |  |  |  | 6.00 | % |  | May 16, 2024 |
Note payable, Truist Bank (2) |  |  | 917,595 |  |  |  | 942,652 |  |  |  | 3.65 | % |  | July 9, 2030 |
Note payable, Texas Bank & Trust (3) |  |  | 478,668 |  |  |  | 491,852 |  |  |  | 3.75 | % |  | September 14, 2025 |
Note payable, Texas Bank & Trust (6) |  |  | 1,766,225 |  |  |  | - |  |  |  | 3.75 | % |  | July 31, 2026 |
DGSE Sub-Total |  |  | 5,958,937 |  |  |  | 4,298,219 |  |  |  |  |  |  |  |
ECHG |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Note payable, related party (1) |  |  | 6,344,572 |  |  |  | 6,496,127 |  |  |  | 6.00 | % |  | May 16, 2024 |
Envela |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Note payable, Texas Bank & Trust (4) |  |  | 2,872,044 |  |  |  | 2,951,379 |  |  |  | 3.25 | % |  | Novemeber 4, 2025 |
Note payable (5) |  |  | - |  |  |  | 1,668,200 |  |  |  |  |  |  |  |
Envela Sub-Total |  |  | 2,872,044 |  |  |  | 4,619,579 |  |  |  |  |  |  |  |
Sub-Total |  |  | 15,175,553 |  |  |  | 15,413,925 |  |  |  |  |  |  |  |
Current portion |  |  | 550,256 |  |  |  | 2,120,457 |  |  |  |  |  |  |  |
|  | $ | 14,625,297 |  |  | $ | 13,293,468 |  |  |  |  |  |  |  |
(1) On May 20, 2019, in connection with the Echo Transaction, the Company entered into two loan agreements with John R. Loftus, the Company’s CEO, President and Chairman of the Board of Directors of the Company (the “Board”), pursuant to which Mr. Loftus made two loans (the “Related Party Loans”) to the Company. ECHG executed a 5-year, $6,925,979 note for the Echo Transaction, amortized over 20 years at a 6% annual interest rate. DGSE executed a 5-year, $3,074,021 note to pay off the accounts payable – related party balance to a related person to the Company, as that term is defined in the instructions to item 404(a) of Regulation S-K, promulgated under the Securities Act (each such person, a “Related Party”). Such person was no longer a Related Party as of May 20, 2019. That promissory note is also amortized over 20 years at a 6% annual interest rate. On January 1, 2020, revisions were made on the original documents for both DGSE and ECHG notes. Originally, the DGSE note stated that the monthly interest and principal payment due was $41,866 and the ECHG note stated that the monthly interest and principal payment due was $94,327. The revised interest and principal payment due monthly on the note for DGSE is $22,203. The revised interest and principal payment due monthly on the note for ECHG is $49,646. The allocation between short-term and long-term notes payable, related party was revised accordingly starting with the three months ended March 31, 2020. (2) On July 9, 2020, DGSE closed the purchase of a new retail building located at 610 E. Round Grove Road in Lewisville, Texas for $1.195 million. The purchase was partly financed through a $956,000, 10 year loan (the “Truist Lewisville Loan”), bearing an annual interest rate of 3.65%, amortized over 20 years, payable to Truist Bank (f/k/a BB&T Bank). The note has monthly interest and principal payments of $5,645. (3) On September 14, 2020, 1106 NWH Holdings, LLC, a wholly owned subsidiary of DGSE, closed on the purchase of a new retail building located at 1106 W. Northwest Highway in Grapevine, Texas for $620,000. The purchase was partly financed through a $496,000, 5 year loan (the “TB&T Grapevine Loan”), bearing an annual interest rate of 3.75%, amortized over 20 years, payable to Texas Bank and Trust. The note has monthly interest and principal payments of $2,941. (4) On November 4, 2020, 1901 Gateway Holdings, LLC, a wholly owned subsidiary of the Company, closed on the purchase of a new office building located at 1901 Gateway Drive, Irving, Texas for $3.521 million. The building was partially financed through a $2.96 million, 5 year loan (the “TB&T Irving Loan”), bearing an interest rate of 3.25%, amortized over 20 years, payable to Texas Bank and Trust. The note has monthly interest and principal payments of $16,792. (5) The Company applied for and received, on April 20, 2020, approximately $1.67 million, 1% interest, federally backed loan intended to pay employees and cover certain rent and utility-related costs during the COVID-19 pandemic (the “Federal Loan”), with Truist Bank (f/k/a BB&T Bank) as lender. The Federal Loan was forgivable to the extent that certain criteria are met. We applied to the Small Business Administration for the forgiveness of the Federal Loan during the fourth quarter ended December 31, 2020. The Federal Loan was forgiven effective April 1, 2021 but notification was not sent to the Company until the third quarter of 2021. (6) On July 30, 2021, 9166 Gaylord Holdings, LLC, a wholly owned subsidiary of DGSE, closed the purchase of a new retail building located at 9166 Gaylord Parkway in Frisco, Texas for $2,215,500. The purchase was partly financed through a $1,772,000, 5 year loan (the “TB&T Frisco Loan”), bearing an annual interest rate of 3.75%, amortized over 20 years, payable to Texas Bank and Trust. The note has monthly interest and principal payments of $10,509. Future scheduled principal payments of our notes payable and notes payable, related party, as of September 30, 2021 are as follows:
Note payable, related party - DGSE |  |  |
Year Ending December 31, |  | Amount |
2021 (excluding the nine months ended September 30, 2021) |  | $ | 24,359 |
2022 |  |  | 100,702 |
2023 |  |  | 106,913 |
2024 |  |  | 2,564,475 |
Subtotal |  | $ | 2,796,449 |
Note payable, Truist Bank - DGSE |  |  |  |
Year Ending December 31, |  | Amount |
2021 (excluding the nine months ended September 30, 2021) |  | $ | 8,495 |
2022 |  |  | 34,682 |
2023 |  |  | 35,988 |
2024 |  |  | 37,342 |
2025 |  |  | 38,748 |
Thereafter |  |  | 762,340 |
Subtotal |  | $ | 917,595 |
Note payable, Texas Bank & Trust - DGSE |  |  |
Year Ending December 31, |  | Amount |
2021 (excluding the nine months ended September 30, 2021) |  | $ | 4,362 |
2022 |  |  | 17,812 |
2023 |  |  | 18,492 |
2024 |  |  | 19,197 |
2025 |  |  | 418,805 |
Subtotal |  | $ | 478,668 |
Note payable, Texas Bank & Trust - DGSE |  |  |
Year Ending December 31, |  | Amount |
2021 (excluding the nine months ended September 30, 2021) |  | $ | 17,263 |
2022 |  |  | 70,314 |
2023 |  |  | 72,634 |
2024 |  |  | 75,030 |
2025 |  |  | 77,505 |
Thereafter |  |  | 1,453,479 |
Subtotal |  | $ | 1,766,225 |
Note payable, related party - ECHG |  |  |
Year Ending December 31, |  | Amount |
2021 (excluding the nine months ended September 30, 2021) |  | $ | 54,300 |
2022 |  |  | 224,460 |
2023 |  |  | 238,305 |
2024 |  |  | 5,827,507 |
Subtotal |  | $ | 6,344,572 |
Note payable, Texas Bank & Trust - Envela |  |  |
Year Ending December 31, |  | Amount |
2021 (excluding the nine months ended September 30, 2021) |  | $ | 26,666 |
2022 |  |  | 108,896 |
2023 |  |  | 112,558 |
2024 |  |  | 116,344 |
2025 |  |  | 2,507,580 |
Subtotal |  | $ | 2,872,044 |
|  | $ | 15,175,553 |

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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