Long Term Debt |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Long Term Debt |
Long-term debt consists of the following as of March 31, 2026, and December 31, 2025:
Credit Facility
The Company’s Credit Facility, established pursuant to its PNC Loan Agreement, and maturing on May 15, 2027, consists of a Revolving Credit facility with a maximum borrowing capacity of $12,500,000. Availability under the Revolving Credit facility is subject to a borrowing base comprised of eligible receivables (as defined in the agreement) and is reduced by (i) outstanding standby letters of credit ($3,350,000 as of March 31, 2026) and (ii) discretionary reserves imposed by the lender ($750,000 as of March 31, 2026). The Credit Facility also includes the Term Loan and the Capital Loan.
Pursuant to the PNC Loan Agreement, payments of annual interest rates are as follows: (i) interest due on the Revolving Credit is at prime (6.75% as of March 31, 2026) plus 2% or SOFR (as defined in the Loan Agreement) plus 3.00% plus an SOFR Adjustment applicable for an interest period selected by the Company; (ii) interest due on the Capital Loan is at prime plus 2.50% or SOFR plus 3.50% plus an SOFR Adjustment applicable for an interest period selected by the Company; and (iii) interest due on the Term Loan is at prime plus 3.00% or SOFR plus 4.00% plus an SOFR Adjustment applicable for an interest period selected by the Company. SOFR Adjustment rates of 0.10% and 0.15% are applicable for a one-month interest period and three-month period, respectively, that may be selected by the Company.
As of March 31, 2026, no early termination fee applies to any future repayment of the outstanding balance under the Credit Facility.
As of March 31, 2026, the Company had no outstanding borrowing under its Revolving Credit and its Liquidity, defined under the PNC Loan Agreement as borrowing availability under the Revolving Credit plus cash in the MMDA maintained with the Company’s lender, was approximately $10,720,000. Pursuant to the PNC Loan Agreement, the Company is required to maintain a minimum of $5,000,000 in daily Liquidity.
The PNC Loan Agreement contains certain financial covenant requirements, along with customary representations and warranties. A breach of any of these financial covenant requirements, unless waived by the lender, could result in a default under the PNC Loan Agreement allowing its lender to immediately require the repayment of all outstanding debt under the PNC Loan Agreement and terminate all commitments to extend further credit. The Company met all of its financial covenant requirements in the first quarter of 2026.
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