Annual report pursuant to Section 13 and 15(d)

NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE

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NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE
12 Months Ended
Dec. 31, 2017
Line of Credit and Term Loan [Abstract]  
Line of Credit and Term Loan [Text Block]
NOTE 6 – LINE OF CREDIT AND PROMISSORY NOTE

On July 21, 2016, SWK entered into a Revolving Demand Note (the “Revolving Demand Note”) by and between SWK (the “Borrower”) and M&T Bank (“Lender”), a commercial lender. The Lender has agreed to loan SWK up to a principal amount of one million dollars. The interest rate on the Revolving Demand Note shall be a variable rate, equal to the “Prime Rate”, plus ninety-five one-hundredths percent (0.95%) per annum.  There is a minimum interest rate floor of four percent (4%). The Revolving Demand Note is secured by all of the Borrower’s assets pursuant to a Security Agreement.  Furthermore, on July 21, 2016, the Company and Mr. Mark Meller, individually, entered into Unlimited Guaranty agreements (the “Guaranty Agreements”) with the Lender. The line is also collateralized by substantially all of the assets of the Company.   Under the Guaranty Agreements, the Company and Mr. Meller personally, jointly and severally guaranteed the liabilities of the Borrower due and owing under the terms of the Revolving Demand Note. At December 31, 2017 and December 31, 2016,  the outstanding balance was $0.

On May 6, 2014, SWK acquired certain assets of ESC, Inc. pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $350,000 (the “ESC Note”). The ESC Note matures on April 1, 2019. Monthly payments are $6,135 including interest at 2% per year. At December 31, 2017 and December 31, 2016, the outstanding balance was $102,742 and $173,535 respectively. 

On March 11, 2015, SWK acquired certain assets of 2000 SOFT, Inc. d/b/a Accounting Technology Resource (ATR) pursuant to an Asset Purchase Agreement for cash of $80,000 and a promissory note for $175,000 (the “ATR Note”). The ATR note matures on February 1, 2018.  Monthly payments are $5,012 including interest at 2% per year. At December 31, 2017 and December 31, 2016, the outstanding balance was $14,987 and $74,194 respectively.

On July 6, 2015, SWK acquired certain assets of ProductiveTech Inc. (PTI) pursuant to an Asset Purchase Agreement cash of $500,000 and a promissory note for $600,000 (the “PTI Note”).  The PTI note is due in 60 months from the closing date and bears interest at a rate of two and one half (2.5%) percent.  The monthly payments including interest are $10,645. At December 31, 2017 and December 31, 2016, the outstanding balance was $319,249 and $437,403 respectively. 

On October 19, 2015, SWK acquired certain assets of Oates & Company, LLC (Oates) pursuant to an Asset Purchase Agreement cash of $125,000 and a promissory note for $175,000 (the “Oates Note”).  The Oates note is due in three years from the closing date and bears interest at a rate of two (2%) percent.  The monthly payments including interest are $5,012. At December 31, 2017 and December 31, 2016, the outstanding balance was $49,494 and $108,018 respectively. 

At December 31, 2017, future payments of promissory notes are as follows over each of the next three fiscal years: 

2018
 
$
257,846
 
2019
   
154,726
 
2020
   
73,900
 
Total
 
$
486,472