11. LINE OF CREDIT

6 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

LINE OF CREDIT

NOTE 11              LINE OF CREDIT

The Company, specifically IPS, has a $1,300,000 revolving line of credit with TD Bank which was renewed on May 7, 2019 with a maturity date of May 31, 2020. The line of credit was amended and modified on September 28, 2018 to extend the line of credit limit from $1,000,000 to $1,300,000 and was also undersigned by Forward Industries, Inc. as the guarantor and is secured by all of IPS' assets. The interest rate on the line of credit is 0.75% above The Wall Street Journal prime rate. The effective interest rate at March 31, 2019 was 6.25%. As of March 31, 2019, the Company had $1,300,000 outstanding under the line of credit. The Company is subject to certain debt-service ratio requirements which are measured annually. As of September 30, 2018, the Company was in compliance with the required covenants. With a six month net loss of approximately $0.979 million for IPS, there is a potential risk of violating covenants at year-end. As such, the lender may demand payment in full upon default.