NOTE P – SUBSEQUENT EVENT

On January 30, 2020 the World Health Organization (“WHO”) announced a global health emergency because of a new strain of a novel coronavirus in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its point of operations. In March 2020, the World Health Organization classified the COVID-19 outbreak a pandemic, based on the rapid increase in exposure globally. The spread of the COVID-19 outbreak has caused significant volatility and uncertainty in U.S. and international markets. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. As such it is uncertain as to the full magnitude that the COVID-19 outbreak will have on the Company’s financial condition, liquidity, and future results of operations.

The COVID-19 outbreak has resulted in and could continue to result in reduced demand for our products and/or cause customers to be unable to meet payment obligations to the Company. The industries that the Company operates in have already been impacted with shelter-in-place directives, school closures, visitor restrictions, travel restrictions, heightened border scrutiny and event cancellations which will materially affect sales levels for fiscal year 2020 and the Company’s overall liquidity. The Company has been informed by some clientele that planned capital expenditures have been suspended until further notice.

The COVID-19 outbreak could adversely affect our supply chain and production capabilities of our primary product supplier located in China, due to quarantines, worker absenteeism, facility closures, and/or increased international trade restrictions or regulations. If any of our supply chain phases were interrupted or terminated, we could experience delays in our project fulfillment process. Delays could result in increased fulfillment costs, customer pricing concessions, or overall project cancellations.

The Company is dependent on its workforce to deliver our products and services. Developments such as social distancing, shelter-in-place directives, furloughs, worker absenteeism, and travel restrictions will impact the Company’s ability to deploy its workforce effectively. While expected to be temporary, prolonged workforce disruptions will negatively impact sales levels for fiscal year 2020 and the Company’s overall liquidity.

In response to the continuing uncertainty resulting from a novel coronavirus, we have implemented and are continuing to review strategic cost reduction strategies across all functional areas. At this time, the disruption is expected to be temporary; however, the length or severity of this pandemic is unknown. Management is actively monitoring the impact of the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce. While we expect this disruption to have a material adverse impact on our results of operations, financial condition and cash flows for the year 2020, the Company is unable to reasonably determine the impact at this time.