Quarterly report pursuant to Section 13 or 15(d)

DEBT

v3.21.1
DEBT
 3 Months Ended
Mar. 31, 2021
Debt Disclosure [Abstract]  
DEBT

NOTE 3 – DEBT

 

Notes Payable - Financing Agreements

 

 

The Company’s notes payable relating to financing agreements classified as current liabilities consist of the following as of:

 

    March 31, 2021     December 31, 2020  
Notes Payable   Principal     Interest     Principal     Interest  
Third Party - Insurance Note 1   $ 16,486       7.75 %   $ 23,327       7.75 %
Third Party - Insurance Note 2     —       5.26 %     10,457       5.26 %
Third Party - Insurance Note 3     5,250       —       9,158       —  
Third Party - Insurance Note 4     215,654       —       —       —  
Total   $ 237,390             $ 42,942          

 

The Company entered into an agreement on December 23, 2020 with its insurance provider by issuing a $23,327 note payable (Insurance Note 1) for the purchase of an insurance policy, secured by that policy with an annual interest rate of 7.75% payable in monthly installments of principal and interest totaling $2,416 through October 23, 2021. The balance of Insurance Note 1 as of March 31, 2021 and December 31, 2020 was $16,486 and $23,327, respectively.

 

The Company entered into an agreement on April 15, 2020 with its insurance provider by issuing a $51,379 note payable (Insurance Note 2) for the purchase of an insurance policy, secured by that policy with an annual interest rate of 5.26% payable in monthly installments of principal and interest totaling $5,263 through February 15, 2021. At March 31, 2021 and December 31, 2020, the balance of Insurance Note 2 was zero and $10,457, respectively.

 

The Company entered into an agreement on September 15, 2020 with its insurance provider by issuing a $13,796 note payable (Insurance Note 3) for the purchase of an insurance policy, secured by 12 monthly installments. At March 31, 2021 and December 31, 2020, the balance of Insurance Note 3 was $5,250 and $9,158, respectively.

 

The Company entered into an agreement on February 3, 2020 with its insurance provider by issuing a $165,375 note payable (Insurance Note 4) with a down payment of $55,563 for the purchase of an insurance policy secured by eight monthly installments of $13,726 through December 3, 2020. The policy renewed on February 3, 2021 in the amount of $215,654 with a down payment paid in the amount of $37,000 on April 6, 2021 and ten monthly installments of $17,899. At March 31, 2021 and December 31, 2020, the balance of Insurance Note 4 was $215,654 and zero, respectively.

 

Equipment Financing

 

The Company entered into an agreement on August 26, 2019 with an equipment financing company by issuing a $147,810 secured note, with an annual interest rate of 12.72% and payable in monthly installments of principal and interest totaling $4,963 through August 1, 2022. The Company entered into an additional agreement on May 22, 2020 with the same equipment financing company by issuing a $121,637 secured note, with an annual interest rate of 9.90% and payable in monthly installments of principal and interest totaling $3,919 through June 1, 2023. At March 31, 2021 and December 31, 2020, the balance of these notes was $171,352 and $192,804, respectively.

 

At March 31, 2021, future minimum lease payments due under the equipment financing is as follows:

 

As of December 31,   Amount  
2021   $ 79,941  
2022     86,735  
2023     23,515  
Total minimum equipment financing payments   $ 190,191  
Less:  interest     (18,839 )
Total equipment financing at March 31, 2021   $ 171,352  
Less: current portion of equipment financing     (92,224 )
Long term portion of equipment financing   $ 79,128  

 

Notes Payable – SBA Loan

 

    March 31, 2021   December 31, 2020  
Payable To   Principal   Interest   Principal     Interest  
                     
SBA loan   $ —       $ 1,410,270       1 %
Total     —         1,410,270          
Less current portion     —         (863,845 )        
Long term portion   $ —       $ 546,425          

 

On April 23, 2020, the Company entered into a promissory note (the “Note”) with BBVA USA, which provided for a loan in the amount of $1,410,270 (the “Loan”) pursuant to the Paycheck Protection Program (the “PPP”) under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The Loan had a two-year term and accrued interest at a rate of 1.00% per annum (APR 1.014%). Monthly principal and interest payments were deferred for nine months after the date of disbursement. The Loan could be prepaid at any time prior to maturity with no prepayment penalties. The Company applied for the PPP loan forgiveness and was granted forgiveness on February 1, 2021. At March 31, 2021 and December 31, 2020, the loan balance was zero and $1,410,270, respectively.