Quarterly report pursuant to Section 13 or 15(d)

Note 8 - Note Payable

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Note 8 - Note Payable
9 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Effect of COVID-19 Pandemic [Text Block]
NOTE
8
 — NOTE PAYABLE 
  
 
On
April 27, 2020,
the Company, was granted a loan (the “Loan”) from Savoy Bank in the aggregate amount of approximately
$276,000,
pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted
March 27, 2020.
The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to
2.5
times of the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after
seven
weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the
eight
-week period.
 
The Loan matures on
April 27, 2022
and bears interest at a rate of
1.00%
per annum, payable monthly commencing on
November 26, 2020.
The Note payable principal is due
April 27, 2022
in a balloon payment if the loan is
not
forgiven. The Note
may
be prepaid by the Borrower at any time prior to maturity with
no
prepayment penalties. Funds from the Loan
may
only be used for payroll costs, costs used to continue group health care benefits, mortgage payments, rent, utilities, and interest on other debt obligations originating before
February 15, 2020.
The Company intends to use the entire Loan amount for qualifying expenses. While the Company currently believes that its use of the loan proceeds will meet the conditions for forgiveness of the loan, we cannot be assured that certain actions taken that could cause the Company to be ineligible for forgiveness of the loan, in whole or in part.