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LONGTERM DEBT | 12 Months Ended
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Dec. 31, 2023
LONGTERM DEBT |
LONG-TERM DEBT | NOTE 9 — LONG-TERM DEBT Long-term debt consists of the following:
|  | Outstanding Balance |  |  |  |  |  |  |
|  | December 31, |  |  | December 31, |  |  | Current |  |  |  |
|  | 2023 |  |  | 2022 |  |  | Interest Rate |  |  | Maturity |
DGSE |  |  |  |  |  |  |  |  |  |  |  |
Note payable, FSB (1) |  | $ | 2,563,108 |  |  | $ | 2,668,527 |  |  |  | 3.10 | % |  | November 15, 2026 |
Note payable, Trust Bank (2) |  |  | 838,430 |  |  |  | 874,418 |  |  |  | 3.65 | % |  | July 9, 2030 |
Note payable, Texas Bank & Trust (3) |  |  | 437,686 |  |  |  | 456,187 |  |  |  | 3.75 | % |  | September 14, 2025 |
Note payable, Texas Bank & Trust (4) |  |  | 1,627,242 |  |  |  | 1,691,020 |  |  |  | 3.75 | % |  | July 30, 2031 |
Kretchmer Transaction note payable (5) |  |  | 200,000 |  |  |  | - |  |  |  | 0.00 | % |  | October 1, 2025 |
DGSE Sub-Total |  |  | 5,666,466 |  |  |  | 5,690,152 |  |  |  |  |  |  |  |
ECHG |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Note payable, FSB (1) |  |  | 5,815,381 |  |  |  | 6,054,565 |  |  |  | 3.10 | % |  | November 15, 2026 |
Line of Credit (6) |  |  | - |  |  |  | - |  |  |  | 3.10 | % |  | November 15, 2024 |
Avail Transaction note payable (7) |  |  | 833,333 |  |  |  | 1,500,000 |  |  |  | 0.00 | % |  | April 1, 2025 |
ECHG Sub-Total |  |  | 6,648,714 |  |  |  | 7,554,565 |  |  |  |  |  |  |  |
Envela |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Note payable, Texas Bank & Trust (8) |  |  | 2,618,311 |  |  |  | 2,732,688 |  |  |  | 3.25 | % |  | November 4, 2025 |
Sub-Total |  |  | 14,933,491 |  |  |  | 15,977,405 |  |  |  |  |  |  |  |
Current portion |  |  | 1,361,443 |  |  |  | 1,250,702 |  |  |  |  |  |  |  |
|  | $ | 13,572,048 |  |  | $ | 14,726,703 |  |  |  |  |  |  |  |
(1) | On November 23, 2021, FSB refinanced prior related party notes held by both Company segments. The commercial segment note was refinanced with a remaining and outstanding balance of $6,309,962, is a five-year promissory note amortized over 20 years at 3.1% annual interest rate. The note has monthly principal and interest payments of $35,292. The consumer segment note was refinanced with a remaining and outstanding balance of $2,781,087, is a five-year promissory note at 3.1% annual interest rate. The note has monthly principal and interest payments of $15,555.
(2) | On July 9, 2020, the consumer segment closed the purchase of a 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, ten-year loan, bearing an annual interest rate of 3.65%, 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, the consumer segment closed on the purchase of a retail building located at 1106 W. Northwest Highway in Grapevine, Texas for $620,000. The purchase was partly financed through a $496,000, five-year loan, bearing an annual interest rate of 3.75%, payable to Texas Bank & Trust. The note has monthly interest and principal payments of $2,941.
(4) | On July 30, 2021, the consumer segment 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, ten-year loan (the “TB&T Frisco Loan”), bearing an annual interest rate of 3.75%, payable to Texas Bank and Trust. The note has monthly interest and principal payments of $10,509.
(5) | On September 12, 2023, the consumer segment entered into the Kretchmer Transaction to purchase all of the issued and outstanding common stock for $300,000. The purchase was facilitated by an initial payment of $100,000 at closing, and the remaining $200,000 to be paid out by eight quarterly payments starting January 1, 2024, of $25,000 each. The installment note payable for the Kretchmer Transaction is imputed at 3.1%.
(6) | On November 23, 2021, the Company secured a 36-month line of credit from FSB for $3,500,000 at 3.1% annual interest rate.
(7) | On October 29, 2021, the commercial segment entered into the Avail Transaction to purchase all of the assets, liabilities and rights and interests of Avail AZ, for $4,500,000. The purchase was facilitated by an initial payment of $2,500,000 at closing, and the remaining $2,000,000 to be paid out by 12 quarterly payments starting April 1, 2022, of $166,667 each. The installment note payable for the Avail Transaction is imputed at 3.1%
(8) | On November 4, 2020, 1901 Gateway Holdings, LLC, a wholly owned subsidiary of Envela Corporation, closed on the purchase of its corporate office building located at 1901 Gateway Drive, Irving, Texas for approximately $3,521,000 million. The building was partially financed through a $2,960,000, five-year loan, bearing an interest rate of 3.25%, payable to Texas Bank & Trust. The note has monthly interest and principal payments of $16,792.
Future scheduled principal payments of our note payables as of December 31, 2023 are as follows: Note payable, Farmers State Bank - DGSE
Year Ending December 31, |  | Amount |
2024 |  |  | 108,743 |
2025 |  |  | 112,162 |
2026 |  |  | 2,342,203 |
Subtotal |  | $ | 2,563,108 |
Note payable, Truist Bank - DGSE
Year Ending December 31, |  | Amount |
2024 |  |  | 37,342 |
2025 |  |  | 38,748 |
2026 |  |  | 40,206 |
2027 |  |  | 42,081 |
2028 |  |  | 43,643 |
Thereafter |  |  | 636,410 |
Subtotal |  | $ | 838,430 |
Note payable, Texas Bank & Trust - DGSE
Year Ending December 31, |  | Amount |
2024 |  |  | 19,209 |
2025 |  |  | 418,477 |
Subtotal |  | $ | 437,686 |
Note payable, Texas Bank & Trust - DGSE
Year Ending December 31, |  | Amount |
2024 |  |  | 66,225 |
2025 |  |  | 75,218 |
2026 |  |  | 78,740 |
2027 |  |  | 80,717 |
2028 |  |  | 83,432 |
Thereafter |  |  | 1,242,910 |
Subtotal |  | $ | 1,627,242 |
Note payable, Farmers Bank - ECHG
Year Ending December 31, |  | Amount |
2024 |  |  | 246,724 |
2025 |  |  | 254,483 |
2026 |  |  | 5,314,174 |
Subtotal |  | $ | 5,815,381 |
Note payable - Justin and Tami Tinkle
Year Ending December 31, |  | Amount |
2024 |  |  | 666,667 |
2025 |  |  | 166,666 |
Subtotal |  | $ | 833,333 |
Note payable - Kretchmer
Year Ending December 31, |  | Amount |
2024 |  |  | 100,000 |
2025 |  |  | 100,000 |
Subtotal |  | $ | 200,000 |
Note payable, Texas Bank & Trust - Envela
Year Ending December 31, |  | Amount |
2024 |  |  | 116,533 |
2025 |  |  | 2,501,778 |
Subtotal |  | $ | 2,618,311 |
|  | $ | 14,933,491 |
Future scheduled aggregate amount of principal payments and maturities of our notes payable as of December 31, 2023 are as follows:
|  | Scheduled |  |  |  |  |  |  |
|  | Principal |  |  | Loan |  |  |  |
Scheduled Principal Payments and Maturities by Year: |  | Payments |  |  | Maturities |  |  | Total |
2024 |  |  | 1,361,443 |  |  |  | - |  |  |  | 1,361,443 |
2025 |  |  | 872,415 |  |  |  | 2,795,117 |  |  |  | 3,667,532 |
2026 |  |  | 464,898 |  |  |  | 7,310,425 |  |  |  | 7,775,323 |
2027 |  |  | 122,798 |  |  |  | - |  |  |  | 122,798 |
2028 |  |  | 127,075 |  |  |  | - |  |  |  | 127,075 |
2029 and thereafter |  |  | 301,189 |  |  |  | 1,578,131 |  |  |  | 1,879,320 |
Total |  | $ | 3,249,818 |  |  | $ | 11,683,673 |  |  | $ | 14,933,491 |

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