6.	LINE OF CREDIT AND LONG-TERM DEBT

Total debt consists of the following as of:

	September 3 0 , 20 20			March 31, 20 20
	(in thousands)
Line of credit	$	2,000		$	2,000
Long-term debt		5,020			5,367
Debt - related party		1,500			1,500
Long-term debt – PPP loan		1,381			—
Less current maturities		(4,197	)		(2,689	)
Long-term debt, excluding current maturities		5,704			6,178
Less unamortized debt issuance costs		(154	)		(169	)
Total long-term debt, net of current maturities and unamortized debt issuance costs	$	5,550		$	6,009

Line of Credit and Term Loans

August 30, 2016,

the Credit Agreement, which the Company entered into with the Bank on

June 3, 2016,

became effective after the Company and the Bank received the necessary approvals from the State of Hawaii to secure the lien on the Company's leasehold property in Kona, Hawaii. The Credit Agreement allows the Company to borrow up to

$2,000,000

on a revolving basis. Borrowings under the Credit Agreement bear interest at the Wall Street Journal prime rate (

3.25%

and

4.75%

September 30, 2020

and

March 31, 2020,

respectively) plus

2%,

floating. At

time shall the annual interest rate be less than

5.25%.

At both

September 30, 2020

and

March 31, 2020,

the outstanding balance under the Credit Agreement was

$2,000,000

and was included in current liabilities on the Condensed Consolidated Balance Sheets. The line of credit, which is subject to annual renewal, was renewed on

August 30, 2020

and will be subject to renewal upon expiration on

August 30, 2021.

The Credit Agreement grants the Bank the following security interests in the Company's property: (a) a lien on the Company's leasehold interest in its Kona facility; (b) an assignment of the Company's interest in leases and rents on its Kona facility; and (c) a security interest in all fixtures, furnishings and equipment related to or used by the Company at the Kona facility. Each security interest is further subject to the terms of the Credit Agreement.

2015,

the Company executed a loan agreement with a lender providing for

$2,500,000

in aggregate credit facilities (the

“2015

Loan”) secured by substantially all the Company's assets, pursuant to a Term Loan Agreement dated

July 30, 2015 (

the

“2015

Loan Agreement”). The

2015

Loan is evidenced by a promissory note in the amount of

$2,500,000,

the repayment of which is partially guaranteed under the provisions of the United States Department of Agriculture (“USDA”) Rural Development Guarantee program. The proceeds of the

2015

Loan were used to pay off a

$500,000

short term note payable that matured on

September 18, 2015,

and to acquire new processing equipment and leasehold improvements at the Company's Kona, Hawaii facility.

The provisions of the

2015

Loan require the payment of principal and interest until its maturity on

September

2022,

the obligation fully amortizes over

seven

(

) years. Interest on the

2015

Loan accrues on the outstanding principal balance at an annual variable rate equal to the published Wall Street Journal prime rate (

3.25%

and

4.75%

September 30, 2020

and

March

31,

2020,

respectively) plus

2.0%

and is adjustable on the

first

day of each calendar quarter and fixed for that quarter. At

time shall the annual interest rate be less than

6.0%.

The

2015

Loan has a prepayment penalty of

5.0%

for any prepayment made prior to the

first

anniversary of the date of the

2015

Loan Agreement, which penalty is reduced by

1.0%

each year thereafter until the

fifth

anniversary of such date, after which there is

prepayment penalty. The balance under the

2015

Loan was

$834,000

and

$1,027,000

September 30, 2020

and

March

31,

2020,

respectively, and was included in long-term debt in the debt table above.

2012,

the Company executed a loan agreement with a lender providing for

$5,500,000

in aggregate credit facilities (the

“2012

Loan”) secured by substantially all the Company's assets, including a mortgage on the Company's interest in its lease at the National Energy Laboratory of Hawaii Authority, pursuant to a Term Loan Agreement dated

August

14,

2012

(the

“2012

Loan Agreement”). The

2012

Loan is evidenced by promissory notes in the amounts of

$2,250,000

and

$3,250,000,

the repayment of which is partially guaranteed under the provisions of a USDA Rural Development Guarantee. The proceeds of the

2012

Loan were used to acquire processing equipment and leasehold improvements at its Kona, Hawaii facility.

The provisions of the

2012

Loan required the payment of interest only for the

first

months of the term; thereafter, and until its maturity on

August

14,

2032,

the obligation fully amortizes over

nineteen

(

) years. Interest on the

2012

Loan accrues on the outstanding principal balance at an annual variable rate equal to the published Wall Street Journal prime rate (

3.25%

and

4.75%

September 30, 2020

and

March

31,

2020,

respectively) plus

1.0%

and is adjustable on the

first

day of each calendar quarter and fixed for that quarter. At

time shall the annual interest rate be less than

5.5%.

The balance under the

2012

Loan was

$4,103,000

and

$4,222,000

September 30, 2020

and

March

31,

2020,

respectively, and was included in long-term debt in the debt table above.

The

2015

Loan includes a

one

-time origination and guaranty fee totaling

$113,900

and an annual renewal fee payable in the amount of

0.5%

of the USDA guaranteed portion of the outstanding principal balance as of

December

of each year, beginning

December

31,

2015.

The USDA has guaranteed

80%

of all amounts owing under the

2015

Loan. The

2012

Loan included a

one

-time origination and guaranty fees totaling

$214,500

and an annual renewal fee payable in the amount of

0.25%

of the USDA guaranteed portion of the outstanding principal balance as of

December

of each year, beginning

December

31,

2012.

The USDA has guaranteed

80%

of all amounts owing under the

2012

Loan. The balance in unamortized debt issuance costs was

$154,000

and

$169,000

September 30, 2020

and

March 31, 2020,

respectively.

Loan Covenants

The Company's Credit Agreement,

2015

Loan and

2012

Loan are subject to annual debt service and other financial covenants, including covenants which require the Company to meet key financial ratios and customary affirmative and negative covenants. As of

March 31, 2020,

the Company was in compliance with all required annual financial covenants. The next remeasurement date will be

March 31, 2021.

Long-term Debt – PPP

May 2020,

the Company obtained a PPP loan in the amount of

$1,381,000,

which matures on

May 5, 2022.

The note bears interest at a rate of

per annum, payable monthly commencing on

November 5, 2020,

following an initial

six

-month deferral period as specified under the PPP. In

October 2020,

the initial deferment period for the commencement of interest payments was amended by the PPP Flexibility Act, to end at the earliest in

April 2021

and at the latest in

August 2021.

The Company has used the proceeds of the PPP loan for certain payroll costs in accordance with the PPP. Under the terms of the PPP and the PPP Flexibility Act, up to the entire amount of principal and accrued interest

may

be forgiven to the extent the proceeds are used for qualifying expenses as determined by the guidance of the U.S. Small Business Administration under these programs. There can be

assurance, however, that the PPP loan will be forgiven in whole or in part. The balance under this loan was

$1,381,000

September 30, 2020

and was included in long-term debt in the debt table above, and interest continues to accrue on the loan.

Debt – Related Party

April 2019,

the Company obtained an unsecured subordinated loan in the amount of

$1,500,000,

which bears interest at the Wall Street Journal prime rate, plus

1%,

4.25%

and

5.5%

September 30, 2020

and

March 30, 2020,

respectively, and is payable quarterly. The principal amount and any accrued and unpaid interest are due in

April 2021 (

see Note

). The balance under this loan was

$1,500,000

September 30, 2020

and

March 31, 2020

and was included in current maturities of long-term debt and long-term debt, respectively, in the debt table above.

Equipment Finance Agreement

October 2017,

the Company entered into an Equipment Finance Agreement (the “Equipment Agreement”) with a lender, which provides up to

$175,000

of financing for equipment. The interest rate on this loan is

4.75%.

The provisions of the Equipment Agreement require the payment of principal and interest until its maturity on

October

31,

2022.

The balance under this loan was

$76,000

and

$94,000

September 30, 2020

and

March 31, 2020,

respectively, and was included in long-term debt in the debt table above.

Finance Lease Obligations

February

2016,

the Company executed a finance lease agreement with Bank of the West providing for

$51,000

in equipment, secured by the equipment financed. The finance lease matures in

March

2021

and is payable in

equal monthly payments. The interest rate under this finance lease is

4.18%.

The balance under this lease was

$7,000

and

$11,000

September 30, 2020

and

March

31,

2020,

respectively, and was included in current maturities of long-term debt in the debt table above.

July

2015,

the Company executed a finance lease agreement with Huntington Technology Finance providing for

$174,000

in equipment, secured by the equipment financed. The finance lease matured in

July

2020

and was payable in

equal monthly payments. The interest rate under this lease is

6.57%.

The balance under this lease was

and

$13,000

September 30, 2020

and

March

31,

2020,

respectively, and was included in current maturities of long-term debt in the debt table above.

Future principal payments under the loans and finance lease obligations at

September

30,

2020

are as follows:

Payments Due	(in thousands)
Remainder of 2021	$	516
2022		2,206
2023		1,970
2024		285
2025		301
Thereafter		2,623
Total principal payments	$	7,901