Subsequent Events

6 Months Ended

Mar. 31, 2014

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Note 11 – Subsequent Events

The Company has evaluated subsequent events through the date that the financial statements were released.

On May 1, 2014, the Company entered into an agreement with Middlesex Savings Bank to establish a revolving line of credit of up to $4 million, subject to availability restrictions described below. Upon the closing of the loan, the Company repaid in full the approximately $1.8 million owed Santander Bank and the $600,000 of accrued interest due, as of April 30, 2014, to Massachusetts Capital Resource Company, its subordinated lender. As a result, as of May 1, 2014, the Company has total indebtedness outstanding consisting of $2.4 million newly drawn senior debt owed to Middlesex Savings Bank and approximately $3.0 million of existing subordinated debt owed to Massachusetts Capital Resource Company due July 2017.

The Bank Loan Agreement provides that the revolving line of credit expires May 2017 and is secured by substantially all the Company's assets. Borrowing availability under the revolving line of credit is determined monthly based on eligible billed and unbilled accounts receivable and inventory. The Company is required to maintain compliance with a debt to service coverage ratio. The interest rate on the loan is equal to the Prime Rate, but in no event less than 3.25%.