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Note 7 - Long-term Debt | 12 Months Ended
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Dec. 31, 2019
Notes to Financial Statements |
Long-term Debt [Text Block] | Note 7 – Long-term Debt
Long-term debt as of December 31 consists of the following: |  |  |  |  |  |  |  |
|  | 201 9 |  |  | 201 8 |
HSBC $10,387,500 Mortgage payable secured by real property Buildings and improvements at 555 N Research Drive, Central Islip, NY payable in monthly principle installments of $62,481 including Interest at a rate of 3.9148% maturing on December 1, 2022. |  | $ | 9,686,211 |  |  | $ | 10,043,802 |
MesoScribe Technologies, Inc. $300,000 acquisition related contingent payment (1) |  |  | - |  |  |  | 200,000 |
HSBC $6,000,000 Mortgage payable secured by building Buildings and improvements at 355 South Technology Drive, Central Islip, NY payable in monthly principle installments of $25,000 plus interest. Interest presently accrues at our option, at the variable rate of LIBOR plus 1.75% or HSBC’s Prime rate minus 0.50% The loan matures on March 1, 2022. |  |  | 2,365,508 |  |  |  | 2,665,508 |
Total long-term debt |  | $ | 12,051,719 |  |  | $ | 12,909,310 |
Less: Current maturities |  |  | (674,593 | ) |  |  | (857,590 | )
Long-term debt |  | $ | 11,377,126 |  |  | $ | 12,051,720 |
( 1 ) | For the twelve -month measurement periods December 31, 2019 and 2018, the Company did not meet the threshold required and $200,000 and $100,000, respectively, of contingent payments was recorded into earnings.
Future maturities of long-term debt as of December 31, 2019 are as follows:
2020 |  | $ | 674,593 |
2021 |  |  | 690,813 |
2022 |  |  | 10,686,313 |
Total long-term debt |  | $ | 12,051,719 |
The Company has a loan agreement with HSBC which is secured by a mortgage against our Central Islip, NY Headquarters. The loan is payable in 120 consecutive equal monthly installments of $25,000 in principal plus interest and a final balloon payment upon maturity in March 2022. The balances as of December 31, 2019 and December 31, 2018 were approximately $2.4 million and $2.7 million respectively. Interest accrues on the Loan, at our option, at the variable rate of LIBOR plus 1.75% or Prime less 0.5% ( 3.49% and 2.18% at December 31, 2019 and 2018, respectively). On November 30, 2017, the Company purchased the premises located at 555 North Research Place, Central Islip, NY. The purchase price of the building was $13,850,000 exclusive of closing costs. The Company’s newly formed wholly-owned subsidiary, 555 N Research Corporation (the “Assignee”) and the Islip IDA, entered into a Fee and Leasehold Mortgage and Security Agreement (the ”Loan”) with HSBC in the amount of $10,387,500, which was used to finance a portion of the purchase price to acquire the premises located at 555 North Research Place, Central Islip, New York. The Loan was evidenced by the certain Note, dated November 30, 2017 ( the “Note”), by and between Assignee and the Bank, and secured by a certain Fee and Leasehold Mortgage and Security Agreement (the “Mortgage”), dated November 30, 2017, as well as a collateral Assignment of Leases and Rents. The Note is payable in 60 consecutive equal monthly installments of $62,481 including interest and a final balloon payment upon maturity in December 2022. The balance outstanding as of December 31, 2019 and December 31, 2018 were approximately $9.7 million and $10.0 million respectively. The Note bears interest for each Interest Period (as defined in the Note), at the fixed rate of 3.9148%. As a condition of the Bank making the Loan, the Company was required to guaranty Assignee’s obligations under the Loan pursuant that certain Unlimited Guaranty, dated November 30, 2017 ( the “Guaranty”). On May 31, 2019, the Company entered into two sublease agreements for a portion of the CVD Materials facility. During the year ended December 31, 2019, the Company recognized $411,000 of rental income which commenced in June 2019. Commencing July 2019, the monthly rental income increased from $36,000 to approximately $67,000 per month, which includes both of the sublease agreements (eastside and westside), or approximately $800,000 per annum. On October 30, 2019, the Tenant exercised its option to terminate the eastside Lease, which termination will be effective as of December 31, 2019 ( the “Termination”). The Lease was for a one -year term ending on June 30, 2020, and provided for an initial base monthly rent of $31,667 per month ( $380,000 per annum). At December 31, 2018, the Company was not in compliance with the one financial covenant (fixed charge coverage ratio) contained in the Mortgage. On March 26, 2019 the Company received a waiver from HSBC until April 1, 2020. On August 5, 2019, the Company entered into a Mortgage Modification Agreement which replaced the former covenant with a Minimum Liquid Assets covenant. The Company is in compliance with its financial covenant under the mortgage at December 31, 2019.

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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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