Note 8 - Subsequent Events

9 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Subsequent Events [Text Block]

8.

      SUBSEQUENT EVENTS

On

April 13, 2020,

the Company entered into an unsecured loan ("SBA Loan") under the Small Business Administration ("SBA") Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") through Town Bank (“Lender”).  The SBA Loan funds that were disbursed on

April 14, 2020,

have a

two

-year term expiring on

April 14, 2022. 

The SBA Loan has a principal amount of

$506,700

 with an interest rate of

1.0%.

The Company

may

apply for forgiveness of the amount due under this SBA Loan in an amount equal to the sum of the following costs incurred by the Company during the

eight

week period following the disbursement of funds under the SBA Loan: (

1

) payroll costs; (

2

) any payment of a covered rent obligation and (

3

) any covered utility payment.  The amount of the loan forgiveness will be calculated (and

may

be reduced) in accordance with the requirements of the Paycheck Protection Program, including the provisions of Section

1106

of the CARES Act. 

Not

more than

25%

of the amount forgiven can be attributable to non-payroll costs.

On

April 24, 2020,

the Company formed a wholly owned subsidiary, Koss Corp BV, in The Netherlands. The Company formed Koss Corp BV to comply with certain European Union requirements. The new entity is non-operating and holds

no

assets.