OPTICAL CABLE CORP 8-K

What Happened
Optical Cable Corporation announced on April 30, 2026 that it entered into a Business Loan Agreement and Promissory Note with Freedom First Federal Credit Union for $2,650,000 and, concurrently, paid in full and terminated its prior Virginia real estate loan with Northeast Bank. The new Note matures May 1, 2036 and includes a 5‑year fixed interest period followed by a variable rate period.

Key Details

• Loan amount: $2,650,000 (Promissory Note dated April 30, 2026). Principal outstanding as of April 30, 2026: $2,650,000.
• Term and payments: Matures May 1, 2036. Years 1–5: 60 monthly P&I payments of $19,912.69 at a fixed 6.5% annual rate (360‑day year basis). Years 6–10: 59 monthly payments at Index + 2.5% (5‑yr Treasury average as Index), subject to a floor of 4.5% and a legal maximum; final balloon payment due May 1, 2036.
• Security and remedies: Secured by a Credit Line Deed of Trust on real property at 5290 N. Concourse Drive, Roanoke, VA (tax map refs listed), plus an Assignment of Rents. The Deed of Trust cross‑secures all present and future obligations to Freedom First and permits lenders’ remedies (including foreclosure and collection of rents) upon default.
• Other notable terms: Prepayment allowed without penalty (loan fees deemed earned); late fee = 5% of payment or $10 (if payment ≥10 days late); default interest rate increases to 18% (subject to law); Note contains a confession of judgment provision.

Why It Matters
For investors, the filing shows OCC replaced its Northeast Bank mortgage with a $2.65M secured facility that lowers the initial fixed interest cost (6.5% fixed) compared with the prior loan structure that referenced Prime with an 8.5% floor. However, the new loan places a first lien on the Roanoke property, assigns rents, and cross‑collateralizes future obligations to Freedom First, increasing secured leverage and giving the lender broad remedies if OCC defaults. These are material credit and liquidity items to monitor in future filings and quarterly reports.