Subsequent Events |
3 Months Ended |
|---|---|
Mar. 31, 2020 | |
| Subsequent Events [Abstract] | |
| Subsequent Events |
Subsequent Events
On April 17, 2020, the Company obtained an unsecured loan through Webster Bank, N.A. in the amount of $1,874,200 in connection with the Paycheck Protection Program pursuant to the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The loan is guaranteed by the United States Small Business Administration. Interest on the loan balance is at the rate of 1% per year, and repayment of the loan balance is deferred until November 17, 2020, at which time the balance is payable in 18 monthly installments of $104,948 with the final payment due April 17, 2022 if not forgiven in accordance with the Cares Act and the terms of the Promissory Note executed by the Company in connection with the loan. The Company intends to use the loan proceeds for payroll, rent, and utilities during the next two months, and to then apply for forgiveness of the loan balance as permitted under the CARES Act and the Promissory Note. No waiver is required under the Company's existing line of credit through Webster Bank in connection with the Paycheck Protection Program loan.
On May 11, 2020 Tecogen Inc. (the "Company") and Webster Business Credit Corporation ("Webster") agreed to terminate the Credit Agreement dated May 4, 2018 by and between Webster and the Company and its wholly owned subsidiaries, together with related agreements, including a Revolving Note, Security Agreement, Blocked Account Agreement, and Master Letter of Credit Agreement. Tecogen paid an early termination fee in the amount of $25,000 in connection with the termination of the Credit Agreement, and plans to continue using cash management services provided by Webster Bank.
The Company has evaluated subsequent events through the date of this filing and determined that no other material subsequent events occurred that would require recognition in the consolidated financial statements or disclosure in the notes thereto.
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