(Registrant’s
Telephone Number, Including Area Code)
(Former
Name or Former Address, if Changed Since Last Report.)
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction
A.2):
☐
Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Securities
registered to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common
Stock, $0.01 par value
ISIG
The
Nasdaq Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933
(§ 230.405 of this chapter) or Rule 12b-2 of the Securities
Exchange Act of 1934 (§ 240.12b-2 of this
chapter):
☐ Emerging growth
company
If an
emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
Item
2.03.
Creation
of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
On April 22, 2020, Insignia Systems, Inc. (the
“Company”) entered into a promissory note (the
“Note”) with Alerus Financial, N.A.. The Note evidences
a loan to the Company in the amount of $1,054,200 pursuant to the
Paycheck Protection Program (the “PPP”) of the
Coronavirus Aid, Relief, and Economic Security Act (the
“CARES Act”) administered by the U.S. Small Business
Administration (the “SBA”).
In accordance with the requirements of the CARES Act, the Company
expects to use the proceeds from the loan exclusively for qualified
expenses under the PPP, including payroll costs, rent and utility
costs, as further detailed in the CARES Act and applicable guidance
issued by the SBA. Interest will accrue on the outstanding balance
of the Note at a rate of 1.00% per annum. However, the Company
expects to apply for forgiveness of up to all amounts due under the
Note, in an amount equal to the sum of qualified expenses under the
PPP during the eight weeks following disbursement. Notwithstanding
the Company’s eligibility to apply for forgiveness, no
assurance can be given that the Company will obtain forgiveness of
all or any portion of amounts due under the Note.
Subject to any forgiveness granted under the PPP, the Note is
scheduled to mature on April 22, 2022 and requires 18 equal monthly
payments of principal and interest beginning November 22, 2020. The
Note may be prepaid at any time prior to maturity with no
prepayment penalties. The Note provides for customary events of
default, including, among others, those relating to failure to make
payments, bankruptcy, breaches of representations, significant
changes in ownership, and material adverse effects. The
Company’s obligations under the Note are not secured by any
collateral.
The foregoing description of the Note is qualified by reference to
the complete text of the Note, which is provided as Exhibit
10.1 to this report and incorporated herein by
reference.
Promissory
Note with Alerus Financial, N.A., dated April 22, 2020
Filed
Electronically
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the Registrant
has duly caused this Current Report to be signed on its behalf by
the undersigned hereunto duly authorized.
