Company: AWX
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001437749-25-025765
Chunk: 13

Company: AVALON HOLDINGS CORP
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 1
Chunk 13
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 associated interest under our 2019 Term Loan Agreement with Laurel Capital Corporation and $0.4million of the proceeds were utilized to pay transaction costs. The remaining proceeds of approximately $10.4million were deposited into a project fund account for which those proceeds are to fund future costs of renovating and expanding both The Grand Resort and Avalon Field Club at New Castle. The balance of “ Restricted Cash” is $9.0million at both June 30, 2025 and December 31, 2024, respectively, and presented in the Consolidated Balance Sheets. The monies are earning nominal interest..

The 2022 Term Loan Agreement is payable in119equal monthly installments of principal and interest, based on a twenty-five(25) year maturity schedule which commenced September 5, 2022 followed by one final balloon payment of all remaining principal, interest and fees due on the maturity date of August 5, 2032. Upon request by Avalon, project fund proceeds can be utilized to pay debt service. Borrowings under the 2022 Term Loan Agreement bear interest at a fixed rate of6.00% until the seventh anniversary date of the closing at which time the interest rate will be reset to a fixed rate equal to the greater of (a)6.00% per annum or (b) the sum of the three year treasury rate on the date two (2) business days prior to the reset date plus3.40%, provided that the applicable rate shall in no event exceed8.50% per annum.

Avalon has the right to prepay the amount outstanding under the 2022 Term Loan Agreement, in whole or in part, at any time upon payment of the principal amount of the loan to be prepaid plus accrued unpaid interest thereon to the prepayment date, plus an applicable prepayment penalty. The prepayment penalty, expressed as a percentage of the principal of the loan being prepaid, is six percent (6%) on any prepayment in the first five years; four percent (4%) on any prepayment in the sixth and seventh year; three percent (3%) on any prepayment in the eighth and ninth year; and two percent (2%) on any prepayment in the tenth year.

Borrowings under the 2022 Term Loan Agreement are secured by certain real property and related business assets as defined in the agreement. The 2022 Term Loan Agreement contains a Fixed Charge Coverage Ratio requirement of at least1.20tested on an annual basis on December 31 of