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Subsequent Events
3 Months Ended
Mar. 31, 2020
Subsequent Events [Abstract]  
Subsequent Events

NOTE 10—SUBSEQUENT EVENTS

 

On April 24, 2020, Acorn Energy, Inc. received Paycheck Protection Program (“PPP”) loan proceeds in the amount of $41,600.

 

On April 30, 2020, OmniMetrix, LLC received PPP loan proceeds in the amount $419,800.

 

Under the PPP of the Coronavirus Aid, Relief and Economic Security Act (the “Act”), up to the full principal amount of a loan and any accrued interest can be forgiven if the borrower uses all of the loan proceeds for forgivable purposes (payroll, benefits, lease/mortgage payments and/or utilities) required under the Act and any rule, regulation, or guidance issued by the SBA pursuant to the Act (collectively, the “Forgiveness Provisions”). The amount of forgiveness of the PPP loan depends on the borrower’s payroll costs over an eight-week period beginning on the date of funding. Any processes or procedures established under the Forgiveness Provisions must be followed and any requirements of the Forgiveness Provisions must be fully satisfied in order to obtain such loan forgiveness. Pursuant to the provisions of the Act, the first six monthly payments of principal and interest will be deferred. Interest will accrue during the deferment period. The borrower must pay principal and interest payments on the fifth day of each month beginning seven months from the date of the applicable promissory note.

 

If no portion of the Acorn Energy PPP loan is forgiven under the Forgiveness Provisions, the monthly payments on that loan will be in the amount of $2,400 each; if no portion of the OmniMetrix PPP loan is forgiven under the Forgiveness Provisions, the monthly payments on that loan will be in the amount of $24,000 each. If any portion of a loan is forgiven under the Forgiveness Provisions, the payments will be in equal amounts which are sufficient to repay all principal and interest over the remaining term of the loan. The lender will apply each installment payment first to pay interest accrued to the day the lender receives the payment, then to bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal. All remaining principal and accrued interest is due and payable two years from the date of the applicable promissory note. In any event any payment is not made within ten days of the due date, the borrower will pay the lender a late charge in the amount not to exceed 5% of the payment. The borrower may prepay the principal at any time without penalty. Upon default, the loan shall bear interest at 6% per year until paid in full.

 

On April 28, 2020, the Company entered into a new agreement for data hosting and business continuity services replacing an expiring agreement with the same vendor effective May 1, 2020. The agreement has a twelve-month term and the total payments under this agreement are $148,000 in the aggregate. This represents an increase of $21,000 for additional services under this agreement from the prior twelve-month period.

 

On May 5, 2020, 2,142,857 warrants with a fair value of $1,018,000 expired in accordance with their terms.