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Note 8 - Long-term Debt

12 Months Ended

Dec. 31, 2022

Note 8 – Long-term Debt

Long-term debt as of December 31 consist of the following (in thousands, except percentages and amounts in notes):

	2022		2021

Equipment loan payable in monthly repayments of $8 including interest at 6% per annum (1)	$	426		-

Mortgage loan secured by building payable in monthly repayments of $25 plus interest at LIBOR plus 1.75% or bank’s prime rate minus 0.5% (2)		-		1,766

Total long-term debt		426		1,766
Less: current maturities		77		1,766

Long-term debt, net of current maturities	$	349	$	-

Future maturities of long-term debt as of December 31, 2022 are as follows (in thousands):

2023	$	77
2024		81
2025		87
2026		92
2027		89

Total	$	426

(1)

In September 2022, the Company entered into a loan agreement to fund the acquisition of machinery equipment. The loan amount of $432,000 is payable in 60 equal monthly installments of $8,352 and secured by equipment. The interest rate is 6%.

(2)

The Company had a loan agreement with a bank that was secured by a mortgage against its Central Islip, New York facility. The loan was payable in 120 consecutive equal monthly installments of $25,000 in principal plus interest and a final balloon payment due upon maturity on March 1, 2022. The interest rate, at the Company’s option, was the variable rate of LIBOR plus 1.75% or the bank’s prime less 0.5% (1.86% at December 31, 2021). This loan was satisfied on March 1, 2022.

In November 2017, the Company purchased the premises located at 555 North Research Place, Central Islip, New York. The purchase price of the building was $13.9 million exclusive of closing costs. The Company entered into a loan agreement with a bank in the amount of $10.4 million to finance a portion of the purchase price. The loan was payable in 60 consecutive equal monthly installments of $62,481 including interest at the fixed rate of 3.92%, and a final balloon payment upon maturity in December 2022. On July 26, 2021, the Company closed on the sale of the 555 Building and satisfied the loan (Note 5).

On April 2020, the Company entered into a loan agreement with a bank pursuant to which the Company was granted a loan (the “PPP loan”) in the principal amount of $2.4 million, pursuant to the Paycheck Protection Program under Division A, Title I of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), which was enacted by the U.S. Congress in March 2020. The PPP loan was to mature on April 21, 2022 and bore interest at a rate of 1% per annum. Under the terms of the PPP loan program, all or a portion of the PPP loan could be forgiven, based upon payments made in the first 24 weeks following receipt of the proceeds, related to payroll costs, continued payment of group health care benefits, utilities and mortgage interest on other debt obligations incurred before February 15, 2020. The Company filed an application for forgiveness in April 2021 and in June 2021 the Company received a notification from its bank that the U.S. Small Business Administration had approved the Company’s PPP loan forgiveness application and remitted payment to the lender for the entire principal amount of the PPP Loan and accrued interest. The Company has recognized a gain on debt extinguishment of $2.4 million in the year ended December 31, 2021.