Note 10 - Notes Payable |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2021 | |||
| Notes to Financial Statements | |||
| Debt Disclosure [Text Block] |
First Insurance Funding
In November 2019, we prepaid $349,000 of insurance premiums through the issuance of a note payable to First Insurance Funding (“FIF”) with an interest rate of 5.0%. The note was payable in monthly installments of $44,000, with the final payment made in July 2020.
Interest expense related to the FIF note payable totaled $5,000 during the year ended December 31, 2020.
IPFS Corporation
In November 2020, we prepaid $442,000 of insurance premiums through the issuance of a note payable to IPFS Corporation (“IPFS”) with an interest rate of 3.5%. The note was payable in monthly installments of $64,000, with the final payment made in June 2021. In November 2021, we prepaid $566,000 of insurance premiums through the issuance of a note payable to IPFS with an interest rate of 4.36%. The note is payable in monthly installments of $114,000, with the final payment due in April 2022.
Interest expense related to the IPFS notes payable totaled $6,000 and $1,000 during the years ended December 31, 2021 and 2020, respectively. The balance of the IPFS notes was approximately $453,000 and $379,000 as of December 31, 2021 and 2020, respectively, and was included in notes payable, current in the consolidated balance sheets.
Paycheck Protection Program
The CARES Act was enacted on March 27, 2020. Among the provisions contained in the CARES Act was the creation of the PPP that provides for SBA Section 7(a) loans for qualified small businesses. PPP Loan proceeds are available to be used to pay for payroll costs, including salaries, commissions, and similar compensation, group health care benefits, and paid leaves; rent; utilities; and interest on certain other outstanding debt. On May 18, 2020, the Lender funded the PPP Loan in the amount of $366,000. In accordance with the loan forgiveness requirements of the CARES Act, the Company used the proceeds from the PPP Loan primarily for payroll costs, rent and utilities. On February 23, 2021, the Lender notified the Company that the entire PPP Loan amount of $366,000 had been forgiven. The forgiveness was recorded as a gain on extinguishment of debt on the consolidated statement of operations. See Note 2.
Summary
During the years ended December 31, 2021 and 2020, we recorded interest expense of $6,000 in both periods related to our notes payable. Annual principal maturities of our notes payable are $453,000 in 2022. |