Notes Payable

9 Months Ended

Sep. 30, 2020

4.	Notes Payable

On May 3, 2020, the Company received loan proceeds of $41,600 (the “PPP Loan”) from Citibank, N.A. pursuant to the Small Business Administration Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”).

The PPP Loan, which was in the form of a promissory note dated May 2, 2020, matures on May 2, 2022 and bears interest at a rate of 1% per annum. No payments are due on the PPP Loan until November 3, 2020, although interest will continue to accrue during the deferment period. The Company may prepay the PPP Loan at any time prior to maturity with no prepayment penalties. The promissory note contains events of default and other provisions customary for a loan of this type.

Under the terms of the CARES Act, PPP Loan participants can apply for and be granted forgiveness for all or a portion of loans provided under the CARES Act. Under the terms of the CARES Act, PPP loans and accrued interest are forgivable after eight weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the eight week period.

The Company has used the loan proceeds for purposes consistent with the CARES Act, and anticipates that all of the loan amount will be forgiven, but there is no assurance provided that the Company will obtain forgiveness of the PPP Loan in whole or part.