XML 34 R21.htm IDEA: XBRL DOCUMENT

LINES OF CREDIT AND LONG-TERM LIABILITIES

12 Months Ended

Sep. 30, 2021

LINES OF CREDIT AND LONG-TERM LIABILITIES

NOTE 15 – LINES OF CREDIT AND LONG-TERM LIABILITIES

Lines of credit

The Company currently has a line of credit with Fulton Bank for $3,500,000. The line carries an interest of LIBOR plus 2.00% per annum (2.075% as of September 30, 2021). At September 30, 2021, there was no outstanding balance on this line of credit. The terms of this line of credit are subject to the bank’s review annually on February1.

Loans payable to bank

On December15, 2015, the Company acquired a loan from Fulton Bank in the amount of $5,250,000 in order to fund the purchase of Advanced Industrial Services, Inc. $5,000,000 of the proceeds went to direct purchase of AIS. This loan carries interest of LIBOR plus 2.25% per annum (2.325% as of September 30, 2021, and 4.23% as of September 30, 2020) and is payable on December 15, 2022. This loan carries loan covenants which the Company was in compliance with as of September 30, 2021. The outstanding balance on this loan was $1,218,680 and $2,164,584, on September 30, 2021, and 2020, respectively. This loan is secured by the assets of the Company.

On May 1, 2018, the Company acquired a loan from Fulton Bank in the amount of $400,000 in order to fund new equipment for Advanced Industrial Services, Inc. This loan carries interest of LIBOR plus 2.00% per annum (3.98% as of September 30, 2020) and is payable on May 1, 2023. This loan carries loan covenants which the Company was in compliance with as of September 30, 2020. The outstanding balance on this loan was $58,897 on September 30, 2020. On September 30, 2021, this loan was fully paid. This loan was secured by the assets of the Company.

On May 1, 2018, the Company acquired a loan from Fulton Bank in the amount of $400,000 in order to fund new equipment for Advanced Industrial Services, Inc. This loan carries interest of LIBOR plus 2.00% per annum (2.075% as of September 30, 2021, and 3.98% as of September 30, 2020) and is payable on May 1, 2023. This loan carries loan covenants which the Company was in compliance with as of September 30, 2021. The outstanding balance on this loan was $149,914 and $246,673, on September 30, 2021, and 2020, respectively. This loan is secured by the assets of the Company.

On January 28, 2020, the Company acquired a loan from Fulton Bank in the amount of $360,000 in order to fund new equipment for Advanced Industrial Services, Inc. This loan carries interest of LIBOR plus 2.25% per annum (2.325% as of September 30, 2021, and 4.23% as of September 30, 2020) and is payable on May 1, 2023. This loan carries loan covenants which the Company was in compliance with as of September 30, 2021. The outstanding balance on this loan was $258,060 and $331,535, on September 30, 2021, and 2020, respectively. This loan is secured by the assets of the Company.

Notes payable

On December 23, 2019, the Company, issued a note payable to an independent private lender in the amount of $1,725,000. This note carries interest of 8% and matures on June 23, 2021. After deduction of an original issue discount of $225,000 and legal fees of $5,000, the Company received $1,495,000 in cash. As of September 30, 2021, this note was fully satisfied. As of September 30, 2020, the balance on this note was $620,754.

On April 24, 2020, the Company, issued a note payable to an independent private lender in the amount of $1,725,000. This note carries interest of 8% and matures on October 24, 2021. After deduction of an original issue discount of $225,000 and legal fees of $5,000, the Company received $1,495,000 in cash. As of September 30, 2021, this note was fully satisfied. As of September 30, 2020, this note had a balance of $1,787,033.

Cemtrex Inc. and Subsidiaries

On September 30, 2020, the Company, issued a note payable to an independent private lender in the amount of $4,605,000. This note carries interest of 8% and matures on March 30, 2022. After deduction of an original issue discount of 600,000 and legal fees of $5,000, the Company received $4,000,000 in cash. As of September 30, 2021, and 2020, this note had a balance of $2,456,448, and $4,605,000, respectively.

On September 30, 2021, the Company, issued a note payable to an independent private lender in the amount of $5,755,000. This note carries interest of 8% and matures on March 30, 2023. After deduction of an original issue discount of 750,000 and legal fees of $5,000, the Company received $5,000,000 in cash. One September 30, 2021, this note had a balance of 5,775,000.

On March 3, 2020, Vicon, a subsidiary of the Company amended the $5,600,000 Term Loan Agreement with NIL Funding Corporation (“NIL”). Upon closing, $500,000 of outstanding borrowings were repaid to NIL, additionally, another $500,000 is to be paid in one year. The Agreement requires monthly payments of accrued interest that began on October 1, 2018. This note carries interest of 8.85% and matures on March 30, 2022. This note carries loan covenants which the Company is in compliance with as of September 30, 2021. On September 30, 2021, and 2020, this note had a balance of $3,604,743, and 4,625,000, respectively.

Mortgage Payable

On January 28, 2020, the Company’s subsidiary, Advanced Industrial Services, Inc., completed the purchase of two buildings for a total purchase price of $3,381,433. The Company paid $905,433 in cash and acquired a mortgage from Fulton Bank in the amount of $2,476,000. This mortgage carries interest of LIBOR plus 2.50% per annum and is payable on January 28, 2040. This loan carries loan covenants similar to covenants on The Company’s other loans from Fulton Bank. As of September 30, 2021, the Company was in compliance with these covenants. The outstanding balance on this mortgage was $2,339,114 and $2,355,542, on September 30, 2021, and 2020, respectively.

Paycheck Protection Program Loans

In April and May of 2020, and January and April of 2021, the Company and its subsidiaries applied for and were granted $6,413,385 in Paycheck Protection Program loans under the CARES Act. These loans bear interest of 2% and mature in two years. The Company has applied for and received loan forgiveness under the provisions of the CARES Act for $6,291,985 with $971,500 being subsequent to September 30, 2021. These loans are recorded under Paycheck Protection Program Loans on our Condensed Consolidated Balance Sheet as of September 30, 2020, net of the short-term portion of $1,032,200, of which $971,500 has been forgiven.

Estimated maturities of our long-term debt over the next 5 years are as follows;

	2022		2023		2024		2025		2026		Thereafter		Total
		713,548		505,132		-		-		-		-	$	1,218,680
Fulton Bank - $5,250,000		713,548		505,132		-		-				-	$	1,218,680
Fulton Bank - $400,000		78,995		70,919		-		-				-	$	149,914
Fulton Bank - $360,000		66,831		69,484		49,502		-				-	$	258,060
Fulton Bank - Mortgage payable		81,329		88,266		92,120		96,142		102,521		1,878,736	$	2,339,114
NIL Funding		3,604,743		-		-		-				-	$	3,604,743
PPP Loans		60,700		1,032,200		-		-				-	$	1,092,900
Notes Payable ⁽¹⁾		5,371,825		2,350,000		-		-				-	$	7,721,825
TOTAL	$	9,977,971	$	4,116,001	$	141,622	$	96,142	$	102,521	$	1,878,736	$	16,385,236

(1)	Net of unamortized original issue discounts of $950,000