Note 6 - Long-term Debt |
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Long-term Debt [Text Block] |
Long-term debt consists of the following at March 31, 2017 and December 31, 2016:
Revolving Credit and Term Loan Agreement
The Company entered into an Amended and Restated Revolving Credit, Term Loan and Security Agreement, dated October 31, 2011 (“Loan Agreement”), with PNC National Association (“PNC”), acting as agent and lender. The Loan Agreement, as subsequently amended (“Amended Loan Agreement”), provides the Company with the following credit facility with a maturity date of March 24, 2021: (a) up to $12,000,000 revolving credit (“revolving credit”), subject to the amount of borrowings based on a percentage of eligible receivables (as defined) and (b) a term loan (“term loan”) of approximately $6,100,000, which requires monthly installments of approximately $101,600 (based on a seven -year amortization). Under the Amended Loan Agreement, the Company has the option of paying an annual rate of interest due on the revolving credit at prime plus 2% or London Inter Bank Offer Rate (“LIBOR”) plus 3% and the term loan at prime plus 2.5% or LIBOR plus 3.5%. Pursuant to the Amended Loan Agreement, the Company may terminate the Amended Loan Agreement, upon 90 days’ prior written notice upon payment in full of its obligations under the Amended Loan Agreement. The Company agreed to pay PNC 1.0% of the total financing in the event the Company had paid off its obligations on or before March 23, 2017, .50% of the total financing if the Company pays off its obligations after March 23, 2017 but prior to or on March 23, 2018, and .25% of the total financing if the Company pays off its obligations after March 23, 2018 but prior to or on March 23, 2019. No early termination fee shall apply if the Company pays off its obligations after March 23, 2019.
As of March 31, 2017, the availability under our revolving credit was $2,350,000, based on our eligible receivables and includes an indefinite reduction of borrowing availability of $1,250,000 that our lender had previously imposed.Pursuant to an amendment that the Company entered into with its lender on November 17, 2016, the lender included a “Condition Subsequent” in the amendment which requires the Company to receive restricted cash from a finite risk sinking fund in connection with its Perma-Fix Northwest Richland, Inc. (“PFNWR”) closure policy. Immediately upon the receipt of funds, the Company’s lender is to place another $750,000 restriction on the Company’s borrowing availability resulting in a total of $2,000,000 restriction on the Company’s borrowing availability (see “Note 9 – Commitments and Contingencies – Insurance” and “Note 14 – Subsequent Events – Closure Policy and Credit Facility” for further information of the PFNWR closure policy and the receipt of the related sinking funds).The Company’s credit facility with PNC contains certain financial covenants, along with customary representations and warranties. A breach of any of these financial covenants, unless waived by PNC, could result in a default under our credit facility allowing our lender to immediately require the repayment of all outstanding debt under our credit facility and terminate all commitments to extend further credit. The Company met its quarterly financial covenants in the first quarter of 2017 and expects to meet its quarterly financial covenants in each of the remaining quarters of 2017 and beyond. |
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