BANK FINANCING ACTIVITIES

3 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

BANK FINANCING ACTIVITIES

4. BANK FINANCING ACTIVITIES

Bank Line of Credit

On October 4, 2021, the Company entered into a Loan Agreement with Main Street Bank of Marlborough, Massachusetts, which provided for a $2,600,000 Term Loan and a $250,000 Revolving Line of Credit Loan Facility, which was increased to $500,000 effective May 17, 2022. The $500,000 line of credit is due on demand and had no borrowings outstanding at September 30, 2022. Borrowings under the line of credit bear interest payable monthly at the prime lending rate plus 1.5% per annum, or 7.75% as of September 30, 2022, and shall not be less than 4.75% per annum. Borrowings under the line of credit are limited to the borrowing base comprised of a percentage of accounts receivable and inventory and are secured by all the assets of the Company.

Long-Term Debt

Long-term debt consists of the following at September 30, 2022:

	Amount
Term Loan Note payable to Main Street Bank with monthly principal payments of $30,952.38 plus interest at the rate of 7.00% as of September 30, 2022. Secured by all assets of the Company, and subject to certain periodic reporting to the bank, an annual minimum EBITDA plus stock based compensation to debt service coverage ratio of 1.20:1 commencing with the fiscal year ending June 30, 2023, and other conditions. The Term Loan Note matures on October 15, 2028.	$	2,259,524
Less current maturities		(371,429	)
Less debt issuance costs, net of accumulated amortization of $929		(22,597	)
Long-term debt, net of current portion of debt issuance costs	$	1,865,498

At September 30, 2022 principal payments due on the Term Loan Note payable are as follows:

Fiscal Year Ending June 30:
2023	$	278,572
2024		371,429
2025		371,429
2026		371,429
2027		371,429
Thereafter		495,236
Total long term debt	$	2,259,524