AVALON HOLDINGS CORP

Capital Expenditures

In 2023, Avalon incurred and paid to vendors capital expenditures in the amount of $3.9 million. In 2022, Avalon incurred capital expenditures of $6.6 million of which $6.4 million of such expenditures was paid to vendors during the year. For both the years ended December 31, 2023 and 2022, expenditures primarily related to the continued renovation of The Grand Resort and the Avalon Field Club at New Castle.

In 2023 and 2022, The Grand Resort was in operation but certain existing hotel rooms were in the process of being renovated. In addition, in 2023, the renovation of the Avalon Field Club at New Castle was substantially complete. Avalon’s aggregate capital expenditures in 2024 are expected to be in the range of $3.0 million to $4.0 million. Capital expenditures principally relate to hotel room expansion and continued room renovations at The Grand Resort, building improvements and equipment purchases. Such capital expenditures are expected to be funded with cash from our project fund account, proceeds from our line of credit and cash generated from operations.