XML 88 R23.htm IDEA: XBRL DOCUMENT v3.20.1
Subsequent Events
9 Months Ended
Mar. 31, 2020
Subsequent Events [Abstract]  
Subsequent Events

17. Subsequent Events

 

Paycheck Protection Program Loan

 

On April 5, 2020, the Company applied for an unsecured $5.2 million loan under the Paycheck Protection Program (the "PPP Loan"). The Paycheck Protection Program (or "PPP") was established under the recently congressionally approved Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") and is administered by the U.S. Small Business Administration ("SBA"). On April 10, 2020, the PPP loan was approved and funded. Misonix entered into a promissory note with JP Morgan Chase evidencing the unsecured $5.2 million loan. In accordance with the requirements of the CARES Act, the Company intends to use proceeds from the PPP Loan primarily for payroll costs.

 

The PPP Loan has a maturity date of April 4, 2022 and accrues interest at an annual rate of 0.98%. The promissory note evidencing the PPP Loan contains customary events of default relating to, among other things, payment defaults and provisions of the promissory note.

  

On April 23, 2020, the SBA issued new guidance that created uncertainty regarding the qualification requirements for a PPP loan and whether a publicly traded company can meet the certification requirements. The SBA also set a deadline of May 14, 2020 for companies to return PPP loan funds without penalty for those companies which can no longer attest in good faith to the revised guidance. The Company is currently reviewing this new guidance, and further SBA clarifications expected to be published soon, to ensure compliance regarding PPP eligibility. There can be no assurance that the Company will retain the PPP loan proceeds, and if it does so, that it will apply for and receive approval for forgiveness under the PPP program.

 

COVID-19

 

In March of 2020, the World Health Organization designated the novel coronavirus disease (COVID-19) as a global pandemic and the impact of COVID-19 and related actions to attempt to control its spread began to impact our consolidated operating results. Through the end of February 2020, the Company's consolidated revenue showed growth compared to the same two-month period in 2019. Principally beginning in March 2020 however, year-over-year consolidated revenue trends began to rapidly and materially weaken. The consolidated revenue of the Company is expected to be negatively and materially impacted in the fourth quarter of fiscal 2020 and in fiscal 2021, and for negative impacts to continue until economic conditions improve.