Note 4 - Promissory Note

9 Months Ended

Jun. 30, 2020

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

Note

4

– Promissory Note

The Company completed a sale of its former Cable TV reporting segment on

June 30, 2019.

In the

first

quarter of

2020,

Leveling

8

Inc. (“Leveling

8”

) paid the Company the

first

installment of

$0.7

million, including interest of

$0.1

million, under the promissory note as part of the sale of the Cable TV segment to Leveling

8.

In the

third

quarter of

2020,

Leveling

8

made another payment of

$1.7

million (

$1.4

million related to principal), which will lower the

$2.5

million balloon payment due upon the maturity of the note as

$0.7

million of this payment was a prepayment against the promissory note. David Chymiak, a director and substantial shareholder of the Company, personally guaranteed the promissory note due to the Company and pledged certain assets (directly and indirectly owned) to secure the payment of the promissory note, including substantially all of David Chymiak's Company common stock. On

March 10, 2020,

the Company entered into a loan agreement with its primary financial lender for

$3.5

million to monetize a portion of this promissory note (see Note

8

).

The remaining promissory note will be paid in semi-annual installments over

five

years including interest of

6%

as follows at

June 30, 2020:

Fiscal year 2021	$	1,400,000
Fiscal year 2022		940,000
Fiscal year 2023		940,000
Fiscal year 2024		1,725,754
Total proceeds		5,005,754
Less: interest to be paid		(655,754	)
Promissory note principal balance	$	4,350,000