11. LINE OF CREDIT

9 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

LINE OF CREDIT

NOTE 11 LINE OF CREDIT

The Company, specifically IPS, has a $1,300,000 revolving line of credit which was renewed at the discretion of the lender on August 5, 2020. The maturity date has been extended to May 31, 2021. The line of credit is guaranteed by the Company and is secured by all of IPS’ assets. The interest rate on the line of credit is 0.75% above The Wall Street Journal prime rate. The effective interest rate at June 30, 2020 and September 30, 2019 was 4.0% and 5.75%, respectively. At September 30, 2019, the Company was in violation of the required debt-service ratio covenants. The Company was granted a waiver of the violation from the lender. At June 30, 2020, the Company had $300,000 available under the line of credit. The Company is subject to certain debt-service ratio requirements which are measured annually. With a net loss for the nine months ended June 30, 2020 of $875,000 for IPS, there is a likely risk of failing the annual covenant testing at September 30, 2020. As such, the lender may demand payment in full upon default.