ADM TRONICS UNLIMITED, INC. Form 10-Q Quarterly Report Filed ...

Business Address224 S PEGASUS AVENORTHVALE NJ 076472017676040

Mailing Address224 S PEGASUS AVENORTHVALE NJ 07647

SECURITIES AND EXCHANGE COMMISSION

FORM 10-QQuarterly report pursuant to sections 13 or 15(d)

Filing Date: 2021-02-12 | Period of Report: 2020-12-31SEC Accession No. 0001437749-21-002793

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FILERADM TRONICS UNLIMITED, INC.CIK:849401| IRS No.: 221896032 | State of Incorp.:DE | Fiscal Year End: 0331Type: 10-Q | Act: 34 | File No.: 000-17629 | Film No.: 21627143SIC: 3845 Electromedical & electrotherapeutic apparatus

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UNITED STATESSECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2020

OR

☐☐ TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

COMMISSION FILE NO. 0-17629

ADM TRONICS UNLIMITED, INC.(Exact name of registrant as specified in its charter)

Delaware(State or Other Jurisdiction

of Incorporation or organization)

22-1896032(I.R.S. Employer

Identification Number)

224-S Pegasus Ave., Northvale, New Jersey 07647(Address of Principal Executive Offices)

Registrant's Telephone Number, including area code: (201) 767-6040

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

None N/A N/A

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of theSecurities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to filesuch reports), and (2) has been subject to such filing requirements for the past 90 days: YES ☒ NO ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to besubmitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorterperiod that the registrant was required to submit such files).YES ☒ NO ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer,smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐

Non-accelerated filer ☐ Smaller reporting company ☒



Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period forcomplying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES ☐ NO ☒

State the number of shares outstanding of each of the Issuer's classes of common equity, as of the latest practicable date:

67,588,504 shares of Common Stock, $.0005 par value, as of February 12, 2021



ADM TRONICS UNLIMITED, INC. AND SUBSIDIARY

INDEX

PageNumber

Part I - Financial Information

Item1. Condensed Consolidated Financial Statements:

Condensed Consolidated Balance Sheets – December 31, 2020 (unaudited) and March 31, 2020 (audited) 3

Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2020and 2019 (unaudited) 4

Condensed Consolidated Statement of Stockholders’ Equity for the nine months ended December 31, 2020(unaudited) 5

Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2020 and 2019(unaudited) 6

Notes to Condensed Consolidated Financial Statements (unaudited) 7

Item2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 16

Item3. Quantitative and Qualitative Disclosures about Market Risk 19

Item4. Controls and Procedures 19

Part II - Other Information

Item1. Legal Proceedings 20

Item1A. Risk Factors 20

Item2. Unregistered Sales of Equity Securities and Use of Proceeds 20

Item3. Defaults Upon Senior Securities 20

Item4. Mine Safety Disclosures 20

Item5. Other Information 20

Item6. Exhibits 21



PART I. FINANCIAL INFORMATIONITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

ADM TRONICS UNLIMITED, INC. AND SUBSIDIARYCONDENSED CONSOLIDATED BALANCE SHEETS

December 31, March 31,2020 2020

(Unaudited) (Audited)ASSETS

Current assets:Cash and cash equivalents $ 1,449,629 $ 1,438,714Accounts receivable, net of allowance for doubtful accounts of $225,000 at December 31,

2020 and March 31, 2020 877,408 860,539

Inventories 448,032 372,635Prepaid expenses and other current assets 66,185 23,525

Total current assets 2,841,254 2,695,413

Other Assets:Property and equipment, net of accumulated depreciation of $173,275 and $145,602

December 31, 2020 and March 31, 2020, respectively 30,285 57,958

Operating lease asset 655,547 706,307Accounts receivable-related party 330,090 330,090Inventories - long-term portion 132,080 132,080Intangible assets, net of accumulated amortization of $16,151 and $14,091 at December

31, 2020 and March 31, 2020, respectively 19,643 21,703

Other assets 90,538 90,538Deferred tax asset 1,013,000 1,019,000

Total other assets 2,271,183 2,357,676

Total assets $ 5,112,437 $ 5,053,089

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:PPP loan - current $ 190,500 $ -Financing lease payable - 21,458Line of credit 85,000 30,000Operating lease liability-current 70,703 68,106Accounts payable 337,640 365,475Accrued expenses and other current liabilities 100,231 136,188Customer deposits 350,340 354,745Due to stockholder 82,678 100,017

Total current liabilities 1,217,092 1,075,989

Long-term liabilitiesOperating lease liability 584,844 638,201PPP loan - noncurrent 190,500 -

Total long-term liabilities 775,344 638,201



Total liabilities $ 1,992,436 $ 1,714,190

Stockholders' equity:Preferred stock, $.01 par value; 5,000,000 shares authorized, no shares issued and

outstanding $ - $ -

Common stock, $0.0005 par value; 150,000,000 shares authorized, 67,588,504 sharesissued and outstanding 33,794 33,794

Additional paid-in capital 33,302,871 33,294,069Accumulated deficit (30,216,664) (29,988,964)

Total stockholders' equity 3,120,001 3,338,899

Total liabilities and stockholders' equity $ 5,112,437 $ 5,053,089

The accompanying notes are an integral part of these condensed consolidated financial statements.

3



ADM TRONICS UNLIMITED, INC. AND SUBSIDIARYCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019(Unaudited)

Three months ended Nine months endedDecember 31, December 31,

2020 2019 2020 2019

Net revenues $ 762,644 $ 805,126 $ 2,258,822 $ 2,592,738

Cost of sales 500,320 487,055 1,480,369 1,427,512

Gross Profit 262,324 318,071 778,453 1,165,226

Operating expenses:Research and development 164,109 169,650 416,519 464,167Selling, general and administrative 172,788 208,639 601,870 724,729Stock based compensation - - 8,802 -Depreciation and amortization 2,148 5,506 6,487 16,517

Total operating expenses 339,045 383,795 1,033,678 1,205,413

Loss from operations (76,721) (65,724) (255,225) (40,187)

Other income (expense):EIDL Grant - - 10,000 -Interest income 3,307 6,051 13,023 19,745Interest and finance expenses (1,261) (857) (3,798) (3,728)

Total other income (expense) 2,046 5,194 19,225 16,017

Loss before provision for (benefit) of income taxes (74,675) (60,530) (236,000) (24,170)

Provision for (benefit) of income taxes:Current (1,800) (12,985) (14,300) (11,985)Deferred (5,000) 72,000 6,000 82,000

Total provision for (benefit) of income taxes (6,800) 59,015 (8,300) 70,015

Net (loss) $ (67,875) $ (119,545) $ (227,700) $ (94,185)

Basic and diluted loss per common share: $ (0.00) $ (0.00) $ (0.00) $ (0.00)

Weighted average shares of common stock outstanding - basic anddiluted

67,588,504 67,588,504 67,588,504 67,588,504


4



ADM TRONICS UNLIMITED, INC. AND SUBSIDIARYCONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020(Unaudited)

CommonStock

CommonStock

AdditionalPaid-

inAccumulated

Shares Amount Capital Deficit Total

Balance at March 31, 2020 67,588,504 $ 33,794 $ 33,294,069 $(29,988,964) $ 3,338,899

Net loss - - - (227,700) (227,700)

Stock based compensation - - 8,802 - 8,802

Balance at December 31, 2020 67,588,504 $ 33,794 $ 33,302,871 $(30,216,664) $ 3,120,001


5



ADM TRONICS UNLIMITED, INC. AND SUBSIDIARYCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Unaudited)

2020 2019Cash flows from operating activities:Net (loss) $ (227,700) $ (94,185)Adjustments to reconcile net (loss) to net cash provided by (used in) operating activities:cash used in operating activities:

Depreciation and amortization 29,733 29,174Write-off of inventories 20,103 34,363Stock based compensation 8,802 -Deferred taxes 6,000 82,000Non-cash operating lease expense 50,760 41,823Non-cash interest expense 25,646 -Bad debt expense 65,000 -

Changes in operating assets and liabilities balances:Accounts receivable (81,869) 204,703Inventories (95,500) (231,295)Prepaid expenses and other current assets (42,660) (78,114)Accounts payable (27,835) 12,541Customer deposits (4,405) 346,803Accrued expenses and other current liabilities (35,957) (15,429)Due to shareholder (17,339) (16,205)Payments of operating lease liability (76,406) (76,406)

Net cash provided by (used in) operating activities (403,627) 239,773

Cash flows provided (used) in financing activities:Proceeds from line of credit 100,000 185,000Repayments of line of credit (45,000) (354,885)Proceeds from PPP loan 381,000 -Repayments on capital lease payable (21,458) (24,140)

Net cash provided by (used in) financing activities 414,542 (194,025)

Net increase in cash and cash equivalents 10,915 45,748

Cash and cash equivalents - beginning of period 1,438,714 1,555,687

Cash and cash equivalents - end of period $ 1,449,629 $ 1,601,435

Cash paid for:Taxes $ - $ 750Interest $ 3,727 $ 3,728

Non-cash operating activities:Operating lease right-of-use asset and liability recorded upon adoption of ASC 842 $ - $ 771,098


6



ADM TRONICS UNLIMITED, INC. AND SUBSIDIARYNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)For the Three and Nine Months Ended DECEMBER 31, 2020

NOTE 1 - NATURE OF BUSINESS

ADM Tronics Unlimited, Inc. ("we", "us", the "Company" or "ADM"), was incorporated under the laws of the state of Delawareon November 24, 1969. We are a manufacturing and engineering concern whose principal lines of business are the design,manufacture and sale of electronics of our own products or on a contract manufacturing basis; the production and sale of chemicaland antistatic products; and, research, development and engineering services.

Electronic equipment is manufactured in accordance with customer specifications on a contract basis. Our electronic device productline consists principally of proprietary devices used in diagnostics and therapeutics of humans and animals and electronic controllersfor spas and hot tubs. These products are sold to customers located principally in the United States. We are registered with the FDAas a contract manufacturing facility and we manufacture medical devices for customers in accordance with their designs andspecifications. Our chemical product line is principally comprised of water-based chemical products used in the food packaging andconverting industries, and anti-static conductive paints, coatings and other products. These products are sold to customers located inthe United States, Australia, Asia and Europe. We also provide research, development, regulatory and engineering services tocustomers. Our Sonotron Medical Systems, Inc. subsidiary (“Sonotron”) is involved in medical electronic therapeutic technology.

The accompanying unaudited condensed consolidated financial statements have been prepared by ADM pursuant to accountingprinciples generally accepted in the United States of America (“US GAAP”) and the rules and regulations of the Securities andExchange Commission (“SEC”) including Form 10-Q and Regulation S-X. The information furnished herein reflects all adjustments(consisting of normal recurring accruals and adjustments) which are, in the opinion of management, necessary to fairly present thecondensed financial position and operating results for the respective periods. Certain information and footnote disclosures normallypresent in annual financial statements prepared in accordance with US GAAP have been omitted pursuant to such rules andregulations. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financialstatements and explanatory notes for the year ended March 31, 2020 as disclosed in our annual report on Form 10-K for that year.The operating results and cash flows for the three and nine months ended December 31, 2020 (unaudited) are not necessarilyindicative of the results to be expected for the pending full year ending March 31, 2021.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

The condensed consolidated financial statements include the accounts of ADM Tronics Unlimited, Inc. and its wholly ownedsubsidiary, Sonotron Medical Systems, Inc. All significant intercompany balances and transactions have been eliminated inconsolidation.

USE OF ESTIMATES

These unaudited condensed consolidated financial statements have been prepared in accordance with US GAAP and, accordingly,requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues andexpenses, and related disclosures of contingent assets and liabilities. Significant estimates made by management include expectedeconomic life and value of our deferred tax assets and related valuation allowance, write down of inventory, impairment of long-lived assets, allowance for doubtful accounts, and warranty reserves. Actual results could differ from those estimates.

FAIR VALUE OF FINANCIAL INSTRUMENTS

For certain of our financial instruments, including accounts receivable, accounts payable, and accrued expenses, the carryingamounts approximate fair value due to their relatively short maturities.

CASH AND CASH EQUIVALENTS



Cash equivalents are comprised of highly liquid investments with original maturities of three months or less when purchased. Wemaintain our cash in bank deposit accounts, which at times, may exceed federally insured limits. We have not experienced any lossesto date as a result of this policy. Cash and cash equivalents held in these accounts are currently insured by the Federal DepositInsurance Corporation (“FDIC”) up to a maximum of $250,000. At December 31, 2020, approximately $1,303,000 exceeded theFDIC limit.

7



ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS

Accounts receivable are stated at the amount management expects to collect from outstanding balances. The carrying amounts ofaccounts receivable is reduced by a valuation allowance that reflects management's best estimate of the amounts that will not becollected. Management individually reviews all accounts receivable balances that exceed the due date and estimates the portion, ifany, of the balance that will not be collected. Management provides for probable uncollectible amounts through a charge to expensesand a credit to a valuation allowance, based on its assessment of the current status of individual accounts. Balances that are stilloutstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance anda credit to accounts receivable.

REVENUE RECOGNITION

ELECTRONICS:

We recognize revenue from the sale of our electronic products when they are shipped to the purchaser. We offer a limited 90-daywarranty on our electronics products and contract manufacturing, and a limited 5-year warranty on our electronic controllers for spasand hot tubs. Historically, the amount of warranty revenue included in sales of our electronic products have been de minimus. Wehave no other post shipment obligations. For contract manufacturing, revenues are recognized after shipments of the completedproducts.

Amounts received from customers in advance of our satisfaction of applicable performance obligations are recorded as customerdeposits. Such amounts are recognized as revenues when the related performance obligations are satisfied. Customer deposits ofapproximately $215,000 as of March 31, 2020 were recognized as revenues during the nine months ended December 31, 2020.

CHEMICAL PRODUCTS:

Revenues are recognized when products are shipped to end users. Shipments to distributors are recognized as revenue when no rightof return exists.

ENGINEERING SERVICES:

We provide certain engineering services, including research, development, quality control, and quality assurance services along withregulatory compliance services. We recognize revenue from engineering services on a monthly basis over time as the applicableperformance obligations are satisfied.

All revenue is recognized net of discounts.

WARRANTY LIABILITIES

The Company’s provision for estimated future warranty costs is based upon historical relationship of warranty claims to sales. Basedupon historical experience, the Company has concluded that no warranty liability is required as of the condensed consolidatedbalance sheet dates. However, the Company periodically reviews the adequacy of its product warranties and will record an accruedwarranty reserve if necessary. Based on prior experience, no amounts have been accrued for potential warranty costs and actual costswere less than $2,000, for the three and nine months ended December 31, 2020 and 2019.

INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out method) and net realizable value. Inventories that are expected to be soldwithin one operating cycle (1 year) are classified as a current asset. Inventories that are not expected to be sold within 1 year, basedon historical trends, are classified as Inventories - long term portion. Obsolete inventory is written off based on prior and expectedfuture usage.

PROPERTY AND EQUIPMENT

We record our property and equipment at historical cost. We expense maintenance and repairs as incurred. Depreciation is providedfor by the straight-line method over five to seven years, the estimated useful lives of the property and equipment.



PAYCHECK PROTECTION PROGRAM LOAN

The Company has obtained a Paycheck Protection Program loan during May 2020 from the Small Business Administration in theamount of $381,000. Management has elected to record the loan under FASB ASC 470, Debt and in the event the Company issuccessful in receiving forgiveness, will treat the qualifying amounts as a gain upon extinguishment in accordance with ASC 405,Liabilities. As of December 31, 2020, management believes that all expenses have met the criteria of qualifying expenses as set forthby the terms of the loan.

8



INTANGIBLE ASSETS

Intangible assets are reviewed for impairment annually whenever changes in circumstances indicate that the carryingamount may not be recoverable. In reviewing for impairment, the Company compares the carrying value of the relevant asset to theestimated undiscounted future cash flows expected from the use of the assets and their eventual disposition. When the estimatedundiscounted future cash flows are less than their carrying amount, an impairment loss is recognized equal to the difference betweenthe assets’ fair value and its carrying value. Although the Company experienced a decrease in sales due to the COVID-19 pandemic,there is no impairment loss for the nine months ended December 31, 2020.

ADVERTISING COSTS

Advertising costs are expensed as incurred and amounted to $6,079 and $9,936 and $25,779 and $33,108 for the three and ninemonths ended December 31, 2020 and 2019, respectively.

INCOME TAXES

We report the results of our operations as part of a consolidated Federal tax return with our subsidiary. Deferred income taxes resultprimarily from temporary differences between financial and tax reporting. Deferred tax assets and liabilities are determined based onthe difference between the financial statement basis and tax basis of assets and liabilities using enacted tax rates. A valuationallowance is recorded to reduce a deferred tax asset to that portion that is expected to more likely than not be realized.

The Company has adopted the authoritative accounting guidance with respect to accounting for uncertainty in income taxes, whichclarified the accounting and disclosures for uncertain tax positions related to income taxes recognized in the consolidated financialstatements and addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should berecorded in the consolidated financial statements. The Company recognizes the financial statement benefit of a tax position onlyafter determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positionsmeeting the more-likely-than-not threshold, the amount recognized in the consolidated financial statements is the largest benefit thathas a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

The Company files income tax returns in several jurisdictions. The Company’s tax returns remain subject to examination, by majorjurisdiction, for the years ended March 31, as follows:

Jurisdiction Fiscal YearFederal 2015 and beyondNew Jersey 2014 and beyond

There are currently no tax years under examination by any major tax jurisdictions.

The Company will recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.As of December 31, 2020, and 2019, the Company has no accrued interest or penalties related to uncertain tax positions.

NET EARNINGS PER SHARE

We compute basic earnings per share by dividing net income/loss by the weighted average number of common shares outstanding.Diluted earnings per share is computed similar to basic earnings per share, except that the denominator is increased to include thenumber of additional common shares that would have been outstanding if the potential shares had been issued and if the additionalshares were dilutive. Common equivalent shares are excluded from the computation of net earnings per share if their effect is anti-dilutive.

Per share basic and diluted earnings amounted to $(0.00) for the three and nine months ended December 31, 2020 and December 31,2019, respectively.

LEASES

In February 2016, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which changes financialreporting as it relates to leasing transactions. Under the new guidance, lessees are required to recognize a lease liability, measured ona discounted basis; and a right-of-use asset, for the lease term. The Company adopted this guidance as of April 1, 2019, using the



modified retrospective approach which allowed it to initially apply the guidance as of the adoption date. The Company elected thepackage of practical expedients available under the new standard, which allowed the Company to forgo a reassessment of (1)whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3)the initial direct costs for any existing leases.

9



The Company made a policy election to recognize short-term lease payments as an expense on a straight-line basis over the leaseterm. The Company defines a short-term lease as a lease that, at the commencement date, has a lease term of twelve months or lessand does not contain an option to purchase the underlying asset that the leasee is reasonably certain to exercise. Related variablelease payments are recognized in the period in which the obligation is incurred.

The Company's lease agreement contains related non-lease components (e.g. taxes, etc.). The Company separates lease componentsand non-lease components for all underlying asset classes.

The adoption of this guidance had a material impact on the Company's Condensed Consolidated Balance Sheet beginning April 1,2019, when the Company recognized (a) a lease liability of $771,098, which represents the present value of the remaining leasepayments of $967,344, discounted using the Company's incremental borrowing rate of 5% and (b) the related right-of-use asset of$771,098, which represents the lease liability. Prior periods were not restated. Adoption of this standard had no change on financingleases previously subject to capital lease treatment under ASC Topic 840, Leases. See Note 9 for further discussion of leases.

The Company determines if a contractual arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liability – current, and operating lease liability – noncurrent on the Company’s condensedconsolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and leaseliabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets andliabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.The lease payments included in the present value are fixed lease payments. As most of the Company’s leases do not provide animplicit rate, the Company estimates its collateralized incremental borrowing rate, based on information available at thecommencement date, in determining the present value of lease payments. The operating lease ROU assets include any paymentsmade before the commencement date and exclude lease incentives. Lease expense for lease payments is recognized on a straight-linebasis over the lease term.

RECLASSIFICATION

Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statementpresentation. These reclassifications have no effect on previously reported net income.

RECENT ACCOUNTING PRONOUNCEMENTS

In June 2016, the FASB issued ASU-2016-13 “Financial Instruments – Credit Losses”. This guidance affects organizations that holdfinancial assets and net investments in leases that are not accounted for at fair value with changes in fair value reported in netincome. The guidance requires organizations to measure all expected credit losses for financial instruments at the reporting datebased on historical experience, current conditions and reasonable and supportable forecasts. It is effective for fiscal years beginningafter December 15, 2019. The Company adopted this ASU as of April 1, 2020 and it has no impact on the Company’s consolidatedfinancial statements.

Management does not believe that any other recently issued, but not yet effective accounting pronouncement, if adopted, would havea material effect on the accompanying consolidated financial statements.

NOTE 3 - INVENTORIES

Inventories at December 31, 2020 consisted of the following:Current Long Term Total

Raw materials $ 381,226 $ 121,013 $ 502,239Finished goods 66,806 11,067 77,873Totals $ 448,032 $ 132,080 $ 580,112

Inventories at March 31, 2020 (Audited) consisted of the following:Current Long Term Total

Raw materials $ 289,369 $ 121,013 $ 410,382Finished goods 83,266 11,067 94,333Totals $ 372,635 $ 132,080 $ 504,715



10



NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment as of December 31, 2020 and March 31, 2020 is as follows:

December 31,2020

March 31,2020

(Audited)Machinery and equipment $ 199,810 $ 199,810Leasehold improvements 3,750 3,750

203,560 203,560

Accumulated depreciation and amortization (173,275) (145,602)

Property and equipment, net $ 30,285 $ 57,958

NOTE 5 - INTANGIBLE ASSETS

Intangible assets are being amortized using the straight-line method over periods ranging from 10-15 years with a weighted averageremaining life of approximately 6 years.

December 31, 2020 March 31, 2020(Audited)

Cost

WeightedAverage

AmortizationPeriod(Years)

AccumulatedAmortization

NetCarryingAmount Cost

WeightedAverage

AmortizationPeriod(Years)

AccumulatedAmortization

NetCarryingAmount

Patents &Trademarks $ 35,794 15 $ (16,151) $ 19,643 $ 35,794 15 $ (14,091) $ 21,703

Estimated aggregate future amortization expense related to intangible assets is as follows:

For the fiscal years ended December 31,2021 $ 2,8822022 2,8822023 2,8822024 2,6322025 2,077

Thereafter 6,288$ 19,643

11



NOTE 6 – CONCENTRATIONS

During the three months ended December 31, 2020, two customers accounted for 52% of net revenue. During the nine monthsended December 31, 2020, two customers accounted for 51% of net revenue.

During the three months ended December 31, 2019, one customer accounted for 51% of net revenue. During the nine months endedDecember 31, 2019, one customer accounted for 49% of net revenue.

As of December 31, 2020, three customers represented 82% of our gross accounts receivable. As of March 31,2020, three customers represented 83% of our gross accounts receivable.

The Company’s customer base is comprised of foreign and domestic entities with diverse demographics. Net revenues from foreigncustomers for the three and nine months ended December 30, 2020 were $89,029 or 12% and $212,517 or 9%, respectively. Netrevenues from foreign customers for the three and nine months ended December 31, 2019 were $38,944 or 5% and $281,226 or11%, respectively.

NOTE 7 - DISAGGREGATED REVENUES AND SEGMENT INFORMATION

The following tables show the Company's revenues disaggregated by reportable segment and by product and service type:

Three months Ended December31,

2020 2019Net Revenue in the US

Chemical $ 263,455 $ 256,318Electronics 270,245 430,114Engineering 139,915 79,750

673,615 766,182

Net Revenue outside the USChemical $ 89,029 $ 38,944Electronics - -Engineering - -

89,029 38,944

Total Net Revenues $ 762,644 $ 805,126

Nine Months Ended December 31,2020 2019

Net Revenue in the USChemical $ 737,057 $ 814,317Electronics 955,217 866,091Engineering 354,031 631,104

2,046,305 2,311,512


212,517 281,226

Total Net Revenues $ 2,258,822 $ 2,592,738



12



Information about segments is as follows:

Chemical Electronics Engineering TotalThree months ended December 31, 2020

Net Revenue from external customers $ 352,484 $ 270,245 $ 139,915 $ 762,644Segment operating income (loss) $ (14,585) $ (83,033) $ 20,897 $ (76,721)

Nine months ended December 31, 2020Net Revenue from external customers $ 949,574 $ 955,217 $ 354,031 $ 2,258,822Segment operating income (loss) $ (70,895) $ (259,137) $ 74,807 $ (255,225)

Three months ended December 31, 2019Net Revenue from external customers $ 295,262 $ 430,114 $ 79,750 $ 805,126Segment operating income (loss) $ 68,392 $ (114,589) $ (19,527) $ (65,724)

Nine months ended December 31, 2019Net Revenue from external customers $ 1,095,543 $ 866,091 $ 631,104 $ 2,592,738Segment operating income (loss) $ 100,659 $ (200,973) $ 60,127 $ (40,187)

Total assets at December 31, 2020 $ 2,096,098 $ 2,198,349 $ 817,990 $ 5,112,437

Total assets at March 31, 2020 (Audited) $ 2,021,235 $ 1,970,705 $ 1,061,149 $ 5,053,089

NOTE 8 – ACCOUNTS RECEIVABLE - RELATED PARTY

The Company has a $75,000 investment for approximately 23% of Qol Devices Inc. (Qol), which is carried at cost and reported as acomponent of other assets in the accompanying consolidated balance sheets.

The Company provided $330,090 in engineering services to Qol during the year March 31, 2018. As of December 31, 2020, theCompany reported a long term receivable as a component of accounts receivable - related party in the accompanying consolidatedbalance sheets.

NOTE 9 – LEASES

We lease our office and manufacturing facility under a non-cancelable operating lease, which expires on June 30, 2028. Thefollowing is a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities as of December 31, 2020:

For the Years Ending December 31,2021 $ 101,8752022 101,8752023 104,3752024 106,8752025 106,875Thereafter 267,187

789,062Less: Amount attributable to imputed interest (133,515)Net liability at December 31, 2020 $ 655,547

Weighted average remaining lease term (in years) 8.0Weighted average discount rate 5.00%

13



Rent and real estate tax expense for all facilities for the three and nine months ended December 31, 2020 and 2019 wasapproximately $34,000 and $103,000, respectively, and $34,000 and $101,000, respectively and are reported as a component of costof sales and selling, general and administrative expenses in the accompanying consolidated statements of operations. The Companypaid in $76,397 in lease payments during the nine months ending December 31, 2020.

During September 2016 the Company leased equipment with a cost of approximately $129,000, under provisions of various long-term financing leases whereby the minimum lease payments have been capitalized. Accumulated depreciation at December 31,2020 is approximately $108,000. The leases expire over various years through 2021. Depreciation of the leased assets is included indepreciation and amortization expense. The lease obligations are secured by the leased assets.

NOTE 10 – PAYROLL PROTECTION PROGRAM (PPP) Loan

The World Health Organization characterized the COVID-19 virus as a global pandemic on March 11, 2020. The duration andeconomic impact of this pandemic are uncertain. The economic impact depends on future developments and the financial conditionof our customers that we may not be able to foresee. Any of these factors, and other factors beyond our control, can adversely impactour results for the full fiscal year and such impact may be material. Due to the global pandemic, the Company experienced adecrease in sales due to the following: certain major customers were not in operation due to the temporary shutdown for severalmonths or experienced a significant decrease in demand due to the stay at home orders and a decrease in elective surgeries and othermedical procedures during the period. At this time, management is unable to quantify its potential effects on the operations andfinancial performance of the Company.

On May 6, 2020, the Company received loan proceeds in the amount of approximately $381,000 under the Small BusinessAdministration ("SBA") Paycheck Protection Program (“PPP”). The PPP, will be fully forgiven if the funds are used for payrollcosts, interest on mortgages, rent, and utilities, with at least 60% being used for payroll. Forgiveness will be reduced if full-timeheadcount declines, or if salaries and wages decrease. Principal and interest payments on any unforgiven portion of the PPP will bedeferred to the date the SBA remits the borrower’s loan forgiveness amount to the lender or, if the borrower does not apply for loanforgiveness, 10 months after the end of the borrower’s loan forgiveness covered period. This loan has an interest rate of 1% and amaturity of 2 years, which can be extended to up to 5 years if the Company and lender agree. No collateral or personal guaranteeswere required for the loan.

The Company has used the entire PPP loan proceeds for designated qualifying expenses and intends to apply for forgiveness of thePPP loan in accordance with the terms of the PPP. No assurance can be given that the Company will obtain forgiveness of the PPPloan in whole or in part. With respect to any portion of the PPP loan that is not forgiven, the PPP will be subject to customaryprovisions for a loan of this type, including customary events of default relating to, among other things, payment defaults, breachesof the provisions of the PPP note and cross defaults.

NOTE 11 – LINE OF CREDIT

On June 15, 2018, the Company obtained an unsecured revolving line of credit, with a limit of $400,000. The line expires May 15,2021, renewing automatically every year. The Company is required to make monthly interest payments, at a rate of 3.870% as ofDecember 31, 2020. Any unpaid principal will be due upon maturity. At December 31, 2020 and March 31, 2020, the outstandingbalance was $85,000 and $30,000, respectively.

NOTE 12 - INCOME TAXES

At December 31, 2020, the Company had federal net operating loss carry-forwards ("NOLs") of approximately $2,515,000. TheseNOLs may be used to offset future taxable income and thereby reduce or eliminate our federal income taxes otherwise payable. Avaluation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized.Ultimate utilization of such NOLs and research and development credits is dependent upon the Company's ability to generatetaxable income in future periods and may be significantly curtailed if a significant change in ownership occurs.

During the nine months ended December 31, 2020, the Company generated approximately $228,000 of the net operating losses, andexpects to utilize the NOL’s before expiration.



The effective tax rates were approximately 4% and (290)% for the nine months ended December 31, 2020 and 2019, respectively.

14



NOTE 13 – STOCK BASED COMPENSATION

On January 13, 2020, ADM granted 300,000 stock options to one employee at an exercise price of $0.20 per option with a term oftwo years subject to vesting in four equal amounts of 75,000 shares every six months. The options were valued at $35,206 using theBlack Scholes option pricing model with the following assumptions: risk free interest rate of 1.58%, volatility of 132%, estimateduseful life of 3 years and dividend rate of 0%.

The following table summarizes information on all common share purchase options issued by us as of December 31,2020 and 2019.

2020 2019# of Shares Weighted # of Shares Weighted

Average AverageExercise Exercise

Price Price

Outstanding, beginning of year 300,000 $ .20 - $ -

Issued - - - -

Exercised - - - -

Expired - - - -

Outstanding, end of period 300,000 $ 0.20 - -

Exercisable, end of period 75,000 $ 0.20 - -

The following table summarizes the information about nonvested options for the nine months ended December 31, 2020:

OptionsWeightedAverage

Exercise PriceNonvested - April 1, 2020 300,000

Granted - $ -Vested (75,000) 0.20Cancelled - -Forfeited - -

Nonvested – December 31, 2020 225,000

Stock based compensation related to the vested options was $8,802 and $0 for the nine months ended December 31, 2020 and 2019,respectively.

As of December 31, 2020, there was $26,404 of unrecognized compensation costs, which is expected to be recognized as follows:

For the years ending December 31, Amount2021 $ 11,7352022 11,7352023 2,934

$ 26,404

NOTE 14 – DUE TO STOCKHOLDER



The Company’s President has been deferring his salary and bonuses periodically to assist the Company’s cash flow. Thereare no repayment terms or interest accruing on this liability.

15



NOTE 15 – LEGAL PROCEEDINGS

In November 2019, the Company filed a civil suit in the Superior Court of New Jersey against an accounting firm seeking adeclaratory judgement from the court that no sum is due to the accounting firm, plus damages, attorney's fees and costs with respectto the foregoing. This matter was settled by mutual agreement for the Company to pay $7,500 to the defendant. All claims weredismissed by both parties on June 2, 2020.

We are involved, from time to time, in litigation and proceedings arising out of the ordinary course of business. Other than theforegoing, there are no pending material legal proceedings or environmental investigations to which we are a party or to which ourproperty is subject.

NOTE 16 – SUBSEQUENT EVENTS

We evaluated all subsequent events from the date of the condensed consolidated balance sheet through the issuance date anddetermined that there are no events or transactions occurring during the subsequent event reporting period which require recognitionor disclosure in the condensed consolidated financial statements.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS

The following discussion of our operations and financial condition should be read in conjunction with the condensed consolidatedfinancial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the "safe harbor" provisions undersection 21E of the Securities and Exchange Act of 1934 and the Private Securities Litigation Act of 1995. We use forward-lookingstatements in our description of our plans and objectives for future operations and assumptions underlying these plans andobjectives. Forward-looking terminology includes the words "may", "expects", "believes", "anticipates", "intends", "forecasts","projects", or similar terms, variations of such terms or the negative of such terms. These forward-looking statements are based onmanagement's current expectations and are subject to factors and uncertainties which could cause actual results to differ materiallyfrom those described in such forward-looking statements. We expressly disclaim any obligation or undertaking to release publiclyany updates or revisions to any forward-looking statements contained in this Form 10-Q to reflect any change in our expectations orany changes in events, conditions or circumstances on which any forward-looking statement is based. Factors which could causesuch results to differ materially from those described in the forward-looking statements include those set forth under "Item. 1Description of Business – Risk Factors" and elsewhere in or incorporated by reference into our Annual Report on Form 10-K for theyear ended March 31, 2020.

CRITICAL ACCOUNTING POLICIES

REVENUE RECOGNITION

ELECTRONICS:

We recognize revenue from the sale of our electronic products when they are shipped to the purchaser. We offer a limited 90-daywarranty on our electronics products and contract manufacturing and a limited 5-year warranty on our electronic controllers for spasand hot tubs. Historically, the amount of warranty revenue included in sales of our electronic products have been de minimus. Wehave no other post shipment obligations.


CHEMICAL PRODUCTS:



Revenues are recognized when products are shipped to end users. Shipments to distributors are recognized as revenue when no rightof return exists.

16




We provide certain engineering services, including research, development, quality control, and quality assurance services along withregulatory compliance services. We recognize revenue from engineering services on a monthly basis over time as the applicableperformance obligations are satisfied.


USE OF ESTIMATES

These unaudited condensed consolidated financial statements have been prepared in accordance with US GAAP and, accordingly,requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues andexpenses, and related disclosures of contingent assets and liabilities. Significant estimates made by management include expectedeconomic life and value of our of our deferred tax assets and related valuation allowance, write down of inventory, impairment oflong-lived assets, allowance for doubtful accounts, and warranty reserves. Actual results could differ from those estimates.

LEASES

In February 2016, the FASB issued authoritative guidance which changes financial reporting as it relates to leasing transactions.Under the new guidance, lessees are required to recognize a lease liability, measured on a discounted basis; and a right-of-use asset,for the lease term. The Company adopted this guidance as of April 1, 2019, using the modified retrospective approach whichallowed it to initially apply the guidance as of the adoption date. The Company elected the package of practical expedients availableunder the new standard, which allowed the Company to forgo a reassessment of (1) whether any expired or existing contracts are orcontain leases, (2) the lease classification for any expired or existing leases, and (3) the initial direct costs for any existing leases.

The Company made a policy election to recognize short-term lease payments as an expense on a straight-line basis over the leaseterm. The Company defines a short-term lease as a lease that, at the commencement date, has a lease term of twelve months or lessand does not contain an option to purchase the underlying asset that the lease is reasonably certain to exercise. Related variable leasepayments are recognized in the period in which the obligation is incurred.

The Company's lease agreement contains related non-lease components (e.g. taxes, etc.). The Company separates lease componentsand non-lease components for all underlying asset classes.

The adoption of this guidance had a material impact on the Company's Condensed Consolidated Balance Sheet beginning April 1,2019, when the Company recognized (a) a lease liability of $771,098, which represents the present value of the remaining leasepayments of $967,344, discounted using the Company's incremental borrowing rate of 5% and (b) the related right-of-use asset of$771,098 which represents the lease liability. Prior periods were not restated. Adoption of this standard had no change on financingleases previously subject to capital lease treatment under ASC Topic 840, Leases. See Note 9 for further discussion of leases.

The Company determines if a contractual arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liability – current, and operating lease liability – noncurrent on the Company’s condensedconsolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and leaseliabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets andliabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.The lease payments included in the present value are fixed lease payments. As most of the Company’s leases do not provide animplicit rate, the Company estimates its collateralized incremental borrowing rate, based on information available at thecommencement date, in determining the present value of lease payments. The operating lease ROU assets include any paymentsmade before the commencement date and exclude lease incentives. Lease expense for lease payments is recognized on a straight-linebasis over the lease term.

BUSINESS OVERVIEW

The Company is a technology-based developer and manufacturer of diversified lines of products and derives revenue from theproduction and sale of electronics for medical devices and other applications; environmentally safe chemical products for industrial,medical and cosmetic uses; and, research, development, regulatory and engineering services. The Company has increased internalresearch and development by utilizing their engineering resources to advance their own proprietary medical device technologies.



The Company is a corporation that was organized under the laws of the State of Delaware on November 24, 1969. Our operationsare conducted through ADM and its subsidiary Sonotron.

17



RESULTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AS COMPAREDTO DECEMBER 31, 2019

Revenues for the three and nine months ended December 31, 2020 decreased by $42,482 and $333,916, respectively. The three-month decrease is a result of increased sales of $57,222 in the Chemical segment and $60,165 in the Engineering segment offset by adecrease of $159,869 in the Electronics segment. The nine-month decrease is a result of decreased sales of $145,969 in the Chemicalsegment and $277,073 in the Engineering segment offset by an increase of $89,126 in the Electronics segment.

Due to the global pandemic, the Company experienced a decrease in sales due to the following: certain major customers were not inoperation due to the temporary shutdown for several months or experienced a significant decrease in demand due to the stay at homeorders and a decrease in elective surgeries and other medical procedures during the period.

Gross profit for the three months ended December 31, 2020 decreased by $55,747. Gross profit for the nine months ended December31, 2020 decreased by $386,773. The decrease in gross profit resulted primarily from decreased sales in Chemical and Engineeringrelated to the COVID-19 pandemic.

We are highly dependent upon certain customers. During the three and nine months ended December 31, 2020, two customersaccounted for 52% and 51% of our net revenue. Net revenues from foreign customers for the three and nine months ended December31, 2020 was $89,029 or 12% and $212,517 or 9%, respectively.

During the three months ended December 31, 2019, one customer accounted for 51% and 49% of our net revenue. Net revenuesfrom foreign customers for the three and nine months ended December 31, 2019 was $38,944 or 5% and $281,226 or11%,respectively.

The complete loss of or significant reduction in business from, or a material adverse change in the financial condition of any of ourcustomers could cause a material and adverse change in our revenues and operating results.

Loss from operations for the three months ended December 31, 2020 increased by $10,997. Coupled with the aforementionedreduction in revenue, the decrease in operating loss for the three-month period is from an increase of the following expenses:approximately $10,000 in bank and credit card fees, $48,000 in salaries, offset by reductions in health insurance of $12,000, and$55,000 in professional fees.

Loss from operations for the nine months ended December 31, 2020 increased by $215,038. Coupled with the aforementionedreduction in revenue, the decrease in operating income for the nine-month period is primarily from an increase of the followingexpenses: approximately $18,000 in salaries, $18,000 in stock-based compensation and consulting, offset by decreases in insurancefees of $21,000.

Other income decreased $3,148 for the three months ended December 31, 2020 and increased $3,208 for the nine months endedDecember 31, 2020. The increase is primarily due EIDL grant of $10,000 offset by decrease in funds invested in a money marketaccount.

The foregoing resulted in a net loss before provision for income taxes for the three months ended December 31, 2020 of $74,675 andnet loss of $236,000 for the nine months ended December 31, 2020. Earnings per share were $(0.00) for the three and nine monthsended December 31, 2020.

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 2020, we had cash and cash equivalents of $1,449,629 as compared to $1,438,714 at March 31, 2020. The $10,915increase was primarily the result of cash used in operations during the nine-month period in the amount of $403,627, offsetwith cash provided in financing activities of $414,542. Our cash will continue to be used for increased marketing costs, andincreased production labor costs all in an attempt to increase our revenue, as well as increased expenditures for our internalR&D. We expect to have enough cash to fund operations for the next twelve months.

Future Sources of Liquidity:

We expect that growth with profitable customers and continued focus on new customers will enable us to continue to generate cashflows from operating activities during fiscal 2020.



Based on current expectations, we believe that our existing cash and cash equivalents of $1,449,629 as of December 31, 2020, andother potential sources of cash will be sufficient to meet our cash requirements. Our ability to meet these requirements will dependon our ability to generate cash in the future, which is subject to general economic, financial, competitive, legislative, regulatory andother factors that are beyond our control.

18



OPERATING ACTIVITIES

Net cash used by operating activities was $403,627 for the nine months ended December 31, 2020, as compared to net cash providedby operating activities of $239,773 for the nine months ended December 31, 2019. The cash used during the nine months endedDecember 31, 2020 was primarily due to net loss of $227,500 less depreciation and amortization of $29,733 and stock basedcompensation of $8,802 coupled with a decrease in net operating liabilities of $161,942 and a decrease in net operating assets of$52,520

INVESTING ACTIVITIES

No cash was provided for or used in investing activities for the nine months ended December 31, 2020.

FINANCING ACTIVITIES

For the nine months ended December 31, 2020, net cash provided by financing activities was $414,542 due to advances from theline of credit of $100,000, proceeds from the PPP loan of $381,000 offset by repayments on finance lease obligations and the line ofcredit of $66,458.

OFF BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements that have had or are reasonably likely to have a current or future effect on our financialcondition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capitalresources.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Concentration of Credit Risk

Financial instruments that potentially subject us to significant concentrations of credit risk consist primarily of cash and cashequivalents and accounts receivable.

Cash and cash equivalents – For financial statement purposes, the Company considers as cash equivalents all highly liquidinvestments with an original maturity of three months or less at inception. The Company deposits cash and cash equivalents withhigh credit quality financial institutions and believes that any amounts in excess of insurance limitations to be at minimal risk. Cashand cash equivalents held at these accounts are currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to amaximum of $250,000. At December 31, 2020, approximately $1,303,000 exceeded the FDIC limit.

Our sales are materially dependent on a small group of customers, as noted in Note 6 of our condensed consolidated financialstatements. We monitor our credit risk associated with our receivables on a routine basis. We also maintain credit controls forevaluating and granting customer credit.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

The Company's management, including the Company's principal executive officer and principal financial officer, have evaluated theeffectiveness of the Company's "disclosure controls and procedures," as such term is defined in Ru1e 13a-15(e) promulgated underthe Securities Exchange Act of 1934, as amended, (the "Exchange Act"). Based upon their evaluation, the principal executive officerand principal financial officer concluded that, as of the end of the period covered by this report, the Company's disclosure controlsand procedures were not effective for the purpose of ensuring that the information required to be disclosed in the reports that theCompany files or submits under the Exchange Act with the Securities and Exchange Commission (the "SEC") (1) is recorded,processed, summarized and reported within the time periods specified in the SEC's rules and forms, and (2) is accumulated andcommunicated to the Company's management, including its principal executive and principal financial officers, as appropriate toallow timely decisions regarding required disclosure. During the quarterly and year to date period ended December 31, 2020, therewere no changes in the Company's internal control over financial reporting which materially affected, or are reasonably likely tomaterially affect, the Company's internal controls over financial reporting.



19



The determination that our disclosure controls and procedures were not effective as of December 31, 2020, is a result of:

a. Deficiencies in Internal Control Structure Environment. During the current year, the Company’s focus was on expanding theircustomer base to initiate revenue production.

b. Inadequate staffing and supervision within the accounting operations of our company. The relatively small number of employeeswho are responsible for accounting functions prevents the Company from segregating duties within its internal control system. Theinadequate segregation of duties is a weakness because it could lead to the untimely identification and resolution of accounting anddisclosure matters or could lead to a failure to perform timely and effective reviews. The Company’s plan is to expand itsaccounting operations as the business of the Company expands.

The Company believes that the financial statements present fairly, in all material respects, the Company’s condensed consolidatedbalance sheets as of December 31, 2020, and March 31, 2020 and the related condensed consolidated statements of income, and cashflows for the three and nine months ended December 31, 2020 and 2019, in conformity with generally accepted accountingprinciples, notwithstanding the material weaknesses we identified.

CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting that occurred during our last fiscal quarter to which this reportrelates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In November 2019, the Company filed a civil suit in the Superior Court of New Jersey against an accounting firm seeking adeclaratory judgement from the court that no sum is due to the accounting firm, plus damages, attorney's fees and costs with respectto the foregoing. This matter was settled by mutual agreement for the Company to pay $7,500 to the defendant. All claims weredismissed by both parties on June 2, 2020. Other than the foregoing, there are no pending material legal proceedings orenvironmental investigations to which we are a party or to which our property is subject.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors contained in our Annual Report on Form 10-K for the year ended March 31,2020.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

None

ITEM 5. OTHER INFORMATION

None

20



ITEM 6. EXHIBITS.

(a) Exhibit No.

31.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant toSection 906 of the Sarbanes-Oxley Act of 2002.

101.INS** XBRL Instance101.SCH**XBRL Taxonomy Extension Schema101.CAL**XBRL Taxonomy Extension Calculation101.DEF**XBRL Taxonomy Extension Definition101.LAB**XBRL Taxonomy Extension Labels101.PRE** XBRL Taxonomy Extension Presentation

** XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12of the Securities Act of 1933, as amended, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, asamended, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on itsbehalf by the undersigned, thereunto duly authorized.

ADM TRONICS UNLIMITED, INC.(Registrant)

By: /s/ Andre' DiMinoAndre' DiMino, Chief ExecutiveOfficer and Chief Financial Officer

Dated: Northvale, New JerseyFebruary 12, 2021

21


http://edgar.secdatabase.com/1778/143774921002793/ex_224870.htm




EXHIBIT 31.1

CERTIFICATIONPURSUANT TO SECTION 302 OF THE SARBANES - OXLEY ACT OF 2002 AND

SECURITIES AND EXCHANGE COMMISSION RELEASE 34-46427

I, Andre' DiMino, certify that:

1. I have reviewed this quarterly report on Form 10-Q of ADM Tronics Unlimited, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material factnecessary to make the statements made, in light of the circumstances under which such statements were made, not misleading withrespect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in allmaterial respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented inthis report;

4. I am the registrant's only certifying officer and am responsible for establishing and maintaining disclosure controls and procedures(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in ExchangeAct Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known tome by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designedunder our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusionsabout the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on suchevaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant'smost recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors andthe audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting whichare reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant'sinternal control over financial reporting.

Date: February 12, 2021 /s/ Andre' DiMinoAndre' DiMinoChief Executive Officer and Chief FinancialOfficer

A signed original of this written statement required by Section 302 has been provided to ADM Tronics Unlimited, Inc. and will beretained by ADM Tronics Unlimited, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.



EXHIBIT 32.1

CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly Report of ADM Tronics Unlimited, Inc. (the "Company") on Form 10-Q for the three and ninemonths ended December 31, 2020, (the "Report"), filed with the Securities and Exchange Commission, Andre' DiMino, ChiefExecutive Officer and Chief Financial Officer, of the Company hereby certifies pursuant to 18 U.S.C. section 1350, as adoptedpursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as amended;and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition of the Company as of thedates presented and the result of operations of the Company for the periods presented.

Date: February 12, 2021 /s/ Andre' DiMinoChief Executive Officer and Chief FinancialOfficer

The foregoing certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and(b) of Section 1350, Chapter 63 of Title 18, United States Code) and is not being filed as part of the Form 10-K or as a separatedisclosure document.

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwiseadopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, hasbeen provided to ADM Tronics Unlimited, Inc. and will be retained by ADM Tronics Unlimited, Inc. and furnished to the Securitiesand Exchange Commission or its staff upon request.



9 Months EndedDocument And EntityInformation - shares Dec. 31, 2020 Feb. 12, 2021

Document Information [Line Items]Entity Registrant Name ADM TRONICS UNLIMITED, INC.Entity Central Index Key 0000849401Current Fiscal Year End Date --03-31Entity Filer Category Non-accelerated FilerEntity Current Reporting Status YesEntity Emerging Growth Company falseEntity Small Business trueEntity Interactive Data Current YesEntity Common Stock, Shares Outstanding (in shares) 67,588,504Entity Shell Company falseDocument Type 10-QDocument Period End Date Dec. 31, 2020Document Fiscal Year Focus 2021Document Fiscal Period Focus Q3Amendment Flag false


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Condensed ConsolidatedBalance Sheets (Current

Period Unaudited) - USD ($)

Dec. 31,2020

Mar. 31,2020

Current assets:Cash and cash equivalents $ 1,449,629 $ 1,438,714Accounts receivable, net of allowance for doubtful accounts of $225,000 at December31, 2020 and March 31, 2020 877,408 860,539

Inventories 448,032 372,635Prepaid expenses and other current assets 66,185 23,525Total current assets 2,841,254 2,695,413Property and equipment, net of accumulated depreciation of $173,275 and $145,602December 31, 2020 and March 31, 2020, respectively 30,285 57,958

Operating lease asset 655,547 706,307Accounts receivable-related party 330,090 330,090Inventories - long-term portion 132,080 132,080Intangible assets, net of accumulated amortization of $16,151 and $14,091 atDecember 31, 2020 and March 31, 2020, respectively 19,643 21,703

Other assets 90,538 90,538Deferred tax asset 1,013,000 1,019,000Total other assets 2,271,183 2,357,676Total assets 5,112,437 5,053,089Current liabilities:PPP loan - current 190,500Financing lease payable 21,458Line of credit 85,000 30,000Operating lease liability-current 70,703 68,106Accounts payable 337,640 365,475Accrued expenses and other current liabilities 100,231 136,188Customer deposits 350,340 354,745Due to stockholder 82,678 100,017Total current liabilities 1,217,092 1,075,989Long-term liabilitiesOperating lease liability 584,844 638,201PPP loan - noncurrent 190,500Total long-term liabilities 775,344 638,201Total liabilities 1,992,436 1,714,190Stockholders' equity:Preferred stock, $.01 par value; 5,000,000 shares authorized, no shares issued andoutstandingCommon stock, $0.0005 par value; 150,000,000 shares authorized, 67,588,504 sharesissued and outstanding 33,794 33,794

Additional paid-in capital 33,302,871 33,294,069Accumulated deficit (30,216,664) (29,988,964)Total stockholders' equity 3,120,001 3,338,899


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Total liabilities and stockholders' equity $ 5,112,437 $ 5,053,089


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Condensed ConsolidatedBalance Sheets (Current

Period Unaudited)(Parentheticals) - USD ($)

Dec. 31, 2020 Mar. 31, 2020

Accounts receivable, allowance for doubtful accounts $ 225,000 $ 225,000Property and equipment, accumulated depreciation 173,275 145,602Intangible assets, accumulated amortization $ 16,151 $ 14,091Preferred stock, par value (in dollars per share) $ 0.01 $ 0.01Preferred stock, authorized (in shares) 5,000,000 5,000,000Preferred stock, issued (in shares) 0 0Preferred stock, outstanding (in shares) 0 0Common stock, par value (in dollars per share) $ 0.0005 $ 0.0005Common stock, authorized (in shares) 150,000,000 150,000,000Common stock, issued (in shares) 67,588,504 67,588,504Common stock, outstanding (in shares) 67,588,504 67,588,504


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3 Months Ended 9 Months EndedCondensed ConsolidatedStatements of Operations

(Unaudited) - USD ($)$ / shares in Thousands

Dec. 31,2020

Dec. 31,2019

Dec. 31,2020

Dec. 31,2019

Net revenues $ 762,644 $ 805,126 $2,258,822

$2,592,738

Cost of sales 500,320 487,055 1,480,369 1,427,512Gross Profit 262,324 318,071 778,453 1,165,226Operating expenses:Research and development 164,109 169,650 416,519 464,167Selling, general and administrative 172,788 208,639 601,870 724,729Stock based compensation 8,802 0Depreciation and amortization 2,148 5,506 6,487 16,517Total operating expenses 339,045 383,795 1,033,678 1,205,413Loss from operations (76,721) (65,724) (255,225) (40,187)Other income (expense):EIDL Grant 10,000Interest income 3,307 6,051 13,023 19,745Interest and finance expenses (1,261) (857) (3,798) (3,728)Total other income (expense) 2,046 5,194 19,225 16,017Loss before provision for (benefit) of income taxes (74,675) (60,530) (236,000) (24,170)Provision for (benefit) of income taxes:Current (1,800) (12,985) (14,300) (11,985)Deferred (5,000) 72,000 6,000 82,000Total provision for (benefit) of income taxes (6,800) 59,015 (8,300) 70,015Net (loss) $ (67,875) $

(119,545)$(227,700) $ (94,185)

Basic and diluted loss per common share: (in dollars per share) $ 0 $ 0 $ 0 $ 0Weighted average shares of common stock outstanding - basic anddiluted (in shares) 67,588,50467,588,50467,588,50467,588,504


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Condensed ConsolidatedStatement of Stockholders'

Equity (Unaudited) - 9months ended Dec. 31, 2020 -

USD ($)

Common Stock[Member]

Additional Paid-in Capital[Member]

Retained Earnings[Member] Total

Balance (in shares) at Mar. 31,2020 67,588,504

Balance at Mar. 31, 2020 $ 33,794 $ 33,294,069 $ (29,988,964) $3,338,899

Net loss (227,700) (227,700)Stock based compensation 8,802 8,802Balance (in shares) at Dec. 31,2020 67,588,504

Balance at Dec. 31, 2020 $ 33,794 $ 33,302,871 $ (30,216,664) $3,120,001


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9 Months EndedCondensed ConsolidatedStatements of Cash Flows

(Unaudited) - USD ($)Dec. 31,

2020Dec. 31,

2019Cash flows from operating activities:Net (loss) $

(227,700)$(94,185)

Adjustments to reconcile net (loss) to net cash provided by (used in) operatingactivities: cash used in operating activities:Depreciation and amortization 29,733 29,174Write-off of inventories 20,103 34,363Stock based compensation 8,802Deferred taxes 6,000 82,000Non-cash operating lease expense 50,760 41,823Non-cash interest expense 25,646Bad debt expense 65,000Changes in operating assets and liabilities balances:Accounts receivable (81,869) 204,703Inventories (95,500) (231,295)Prepaid expenses and other current assets (42,660) (78,114)Accounts payable (27,835) 12,541Customer deposits (4,405) 346,803Accrued expenses and other current liabilities (35,957) (15,429)Due to shareholder (17,339) (16,205)Payments of operating lease liability (76,406) (76,406)Net cash provided by (used in) operating activities (403,627) 239,773Cash flows provided (used) in financing activities:Proceeds from line of credit 100,000 185,000Repayments of line of credit (45,000) (354,885)Proceeds from PPP loan 381,000Repayments on capital lease payable (21,458) (24,140)Net cash provided by (used in) financing activities 414,542 (194,025)Net increase in cash and cash equivalents 10,915 45,748Cash and cash equivalents - beginning of period 1,438,714 1,555,687Cash and cash equivalents - end of period 1,449,629 1,601,435Cash paid for:Taxes 750Interest 3,727 3,728Non-cash operating activities:Operating lease right-of-use asset and liability recorded upon adoption of ASC 842 $ 771,098


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9 Months EndedNote 1 - Nature of Business Dec. 31, 2020Notes to FinancialStatementsOrganization, Consolidationand Presentation of FinancialStatements Disclosure [TextBlock]

NOTE 1 - NATURE OF BUSINESS

ADM Tronics Unlimited, Inc. ("we", "us", the "Company" or "ADM"), was incorporated underthe laws of the state of Delaware on November 24, 1969. We are a manufacturing andengineering concern whose principal lines of business are the design, manufacture and sale ofelectronics of our own products or on a contract manufacturing basis; the production and sale ofchemical and antistatic products; and, research, development and engineering services.

Electronic equipment is manufactured in accordance with customer specifications on a contractbasis. Our electronic device product line consists principally of proprietary devices used indiagnostics and therapeutics of humans and animals and electronic controllers for spas and hottubs. These products are sold to customers located principally in the United States. We areregistered with the FDA as a contract manufacturing facility and we manufacture medical devicesfor customers in accordance with their designs and specifications. Our chemical product line isprincipally comprised of water-based chemical products used in the food packaging andconverting industries, and anti-static conductive paints, coatings and other products. Theseproducts are sold to customers located in the United States, Australia, Asia and Europe. We alsoprovide research, development, regulatory and engineering services to customers. Our SonotronMedical Systems, Inc. subsidiary (“Sonotron”) is involved in medical electronic therapeutictechnology.

The accompanying unaudited condensed consolidated financial statements have been prepared byADM pursuant to accounting principles generally accepted in the United States of America (“USGAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”)including Form 10-Q and Regulation S-X. The information furnished herein reflects alladjustments (consisting of normal recurring accruals and adjustments) which are, in the opinionof management, necessary to fairly present the condensed financial position and operating resultsfor the respective periods. Certain information and footnote disclosures normally present inannual financial statements prepared in accordance with US GAAP have been omitted pursuant tosuch rules and regulations. These condensed consolidated financial statements should be read inconjunction with the audited consolidated financial statements and explanatory notes for the yearended March 31, 2020 as disclosed in our annual report on Form 10-K for that year. Theoperating results and cash flows for the three and nine months ended December 31, 2020(unaudited) are not necessarily indicative of the results to be expected for the pending full yearending March 31, 2021.


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9 Months EndedNote 2 - SignificantAccounting Policies Dec. 31, 2020

Notes to FinancialStatementsSignificant AccountingPolicies [Text Block]

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES



USE OF ESTIMATES





Cash equivalents are comprised of highly liquid investments with original maturities of three months or less when purchased. Wemaintain our cash in bank deposit accounts, which at times, may exceed federally insured limits. We have not experienced anylosses to date as a result of this policy. Cash and cash equivalents held in these accounts are currently insured by the FederalDeposit Insurance Corporation (“FDIC”) up to a maximum of $250,000. At December 31, 2020, approximately $1,303,000exceeded the FDIC limit.


Accounts receivable are stated at the amount management expects to collect from outstanding balances. The carrying amounts ofaccounts receivable is reduced by a valuation allowance that reflects management's best estimate of the amounts that will not becollected. Management individually reviews all accounts receivable balances that exceed the due date and estimates the portion, ifany, of the balance that will not be collected. Management provides for probable uncollectible amounts through a charge toexpenses and a credit to a valuation allowance, based on its assessment of the current status of individual accounts. Balances thatare still outstanding after management has used reasonable collection efforts are written off through a charge to the valuationallowance and a credit to accounts receivable.

REVENUE RECOGNITION

ELECTRONICS:

We recognize revenue from the sale of our electronic products when they are shipped to the purchaser. We offer a limited 90-daywarranty on our electronics products and contract manufacturing, and a limited 5-year warranty on our electronic controllers forspas and hot tubs. Historically, the amount of warranty revenue included in sales of our electronic products have been de minimus.We have no other post shipment obligations. For contract manufacturing, revenues are recognized after shipments of the completedproducts.


CHEMICAL PRODUCTS:

Revenues are recognized when products are shipped to end users. Shipments to distributors are recognized as revenuewhen no right of return exists.


We provide certain engineering services, including research, development, quality control, and quality assurance services alongwith regulatory compliance services. We recognize revenue from engineering services on a monthly basis over time as theapplicable performance obligations are satisfied.




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The Company's provision for estimated future warranty costs is based upon historical relationship of warranty claims to sales.Based upon historical experience, the Company has concluded that no warranty liability is required as of thecondensed consolidated balance sheet dates. However, the Company periodically reviews the adequacy of its product warrantiesand will record an accrued warranty reserve if necessary. Based on prior experience, no amounts have been accrued for potentialwarranty costs and actual costs were less than $2,000, for the three and nine months ended December 31, 2020 and 2019.

INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out method) and net realizable value. Inventories that are expected to besold within one operating cycle (1 year) are classified as a current asset. Inventories that are not expected to be sold within 1 year,based on historical trends, are classified as Inventories - long term portion. Obsolete inventory is written off based on prior andexpected future usage.


We record our property and equipment at historical cost. We expense maintenance and repairs as incurred. Depreciation isprovided for by the straight-line method over five to seven years, the estimated useful lives of the property and equipment.


The Company has obtained a Paycheck Protection Program loan during May 2020 from the Small Business Administration in theamount of $381,000. Management has elected to record the loan under FASB ASC 470, Debt and in the event the Company issuccessful in receiving forgiveness, will treat the qualifying amounts as a gain upon extinguishment in accordance with ASC 405,Liabilities. As of December 31, 2020, management believes that all expenses have met the criteria of qualifying expenses as setforth by the terms of the loan.

INTANGIBLE ASSETS

Intangible assets are reviewed for impairment annually whenever changes in circumstances indicate that the carrying amountmay not be recoverable. In reviewing for impairment, the Company compares the carrying value of the relevant asset to theestimated undiscounted future cash flows expected from the use of the assets and their eventual disposition. When the estimatedundiscounted future cash flows are less than their carrying amount, an impairment loss is recognized equal to the differencebetween the assets' fair value and its carrying value. Although the Company experienced a decrease in sales due to the COVID-19pandemic, there is no impairment loss for the nine months ended December 31, 2020.

ADVERTISING COSTS


INCOME TAXES

We report the results of our operations as part of a consolidated Federal tax return with our subsidiary. Deferred income taxesresult primarily from temporary differences between financial and tax reporting. Deferred tax assets and liabilities are determinedbased on the difference between the financial statement basis and tax basis of assets and liabilities using enacted tax rates. Avaluation allowance is recorded to reduce a deferred tax asset to that portion that is expected to more likely than not be realized.

The Company has adopted the authoritative accounting guidance with respect to accounting for uncertainty in income taxes, whichclarified the accounting and disclosures for uncertain tax positions related to income taxes recognized in the consolidated financialstatements and addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should berecorded in the consolidated financial statements. The Company recognizes the financial statement benefit of a tax position onlyafter determining that the relevant tax authority would more likely than not sustain the position following an audit. For taxpositions meeting the more-likely-than-not threshold, the amount recognized in the consolidated financial statements is the largestbenefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

The Company files income tax returns in several jurisdictions. The Company's tax returns remain subject to examination, by majorjurisdiction, for the years ended March 31, as follows:



The Company will recognize interest and penalties accrued on any unrecognized tax benefits as a component of income taxexpense. As of December 31, 2020, and 2019, the Company has no accrued interest or penalties related to uncertain tax positions.


We compute basic earnings per share by dividing net income/loss by the weighted average number of common shares outstanding.Diluted earnings per share is computed similar to basic earnings per share, except that the denominator is increased to include thenumber of additional common shares that would have been outstanding if the potential shares had been issued and if the additional



shares were dilutive. Common equivalent shares are excluded from the computation of net earnings per share if their effect is anti-dilutive.

Per share basic and diluted earnings amounted to $(0.00) for the three and nine months ended December 31, 2020 and December31, 2019, respectively.

LEASES

In February 2016, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which changes financialreporting as it relates to leasing transactions. Under the new guidance, lessees are required to recognize a lease liability, measuredon a discounted basis; and a right-of-use asset, for the lease term. The Company adopted this guidance as of April 1, 2019, usingthe modified retrospective approach which allowed it to initially apply the guidance as of the adoption date. The Company electedthe package of practical expedients available under the new standard, which allowed the Company to forgo a reassessment of (1)whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and(3) the initial direct costs for any existing leases.


The Company's lease agreement contains related non-lease components (e.g. taxes, etc.). The Company separates leasecomponents and non-lease components for all underlying asset classes.

The adoption of this guidance had a material impact on the Company's Condensed Consolidated Balance Sheet beginning April 1,2019, when the Company recognized (a) a lease liability of $771,098, which represents the present value of the remaining leasepayments of $967,344, discounted using the Company's incremental borrowing rate of 5% and (b) the related right-of-use asset of$771,098, which represents the lease liability. Prior periods were not restated. Adoption of this standard had no change onfinancing leases previously subject to capital lease treatment under ASC Topic 840, Leases. See Note 9 for further discussion ofleases.

The Company determines if a contractual arrangement is a lease at inception. Operating leases are included in operating leaseright-of-use (“ROU”) assets, operating lease liability – current, and operating lease liability – noncurrent on the Company'scondensed consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term andlease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets andliabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.The lease payments included in the present value are fixed lease payments. As most of the Company's leases do not provide animplicit rate, the Company estimates its collateralized incremental borrowing rate, based on information available at thecommencement date, in determining the present value of lease payments. The operating lease ROU assets include any paymentsmade before the commencement date and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

RECLASSIFICATION



In June 2016, the FASB issued ASU-2016-13 “Financial Instruments – Credit Losses”. This guidance affects organizations thathold financial assets and net investments in leases that are not accounted for at fair value with changes in fair value reported in netincome. The guidance requires organizations to measure all expected credit losses for financial instruments at the reporting datebased on historical experience, current conditions and reasonable and supportable forecasts. It is effective for fiscal yearsbeginning after December 15, 2019. The Company adopted this ASU as of April 1, 2020 and it has no impact on the Company'sconsolidated financial statements.

Management does not believe that any other recently issued, but not yet effective accounting pronouncement, if adopted, wouldhave a material effect on the accompanying consolidated financial statements.



9 Months EndedNote 3 - Inventories Dec. 31, 2020Notes to FinancialStatementsInventory Disclosure [TextBlock]

NOTE 3 - INVENTORIES

Inventories at December 31,2020 consisted of thefollowing:

Current Long Term TotalRaw materials $ 381,226 $ 121,013 $ 502,239Finished goods 66,806 11,067 77,873Totals $ 448,032 $ 132,080 $ 580,112

Inventories at March 31, 2020(Audited) consisted of thefollowing:



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9 Months EndedNote 4 - Property andEquipment Dec. 31, 2020

Notes to FinancialStatementsProperty, Plant and EquipmentDisclosure [Text Block]

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment as of December 31, 2020 and March 31, 2020 is as follows:

December 31,2020

March 31,2020


203,560 203,560




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9 Months EndedNote 5 - Intangible Assets Dec. 31, 2020Notes to FinancialStatementsIntangible Assets Disclosure[Text Block]

NOTE 5 - INTANGIBLE ASSETS

Intangible assets are being amortized using the straight-line method over periods ranging from 10-15 years with a weighted average remaining life of approximately 6years.


Cost

Weighted AverageAmortization Period

(Years)AccumulatedAmortization




NetCarryingAmount


Estimated aggregate future amortization expense related to intangible assets is as follows:




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9 Months EndedNote 6 - Concentrations Dec. 31, 2020Notes to FinancialStatementsConcentration Risk Disclosure[Text Block]

NOTE 6 – CONCENTRATIONS

During the three months ended December 31, 2020, two customers accounted for 52% of netrevenue. During the nine months ended December 31, 2020, two customers accounted for51% of net revenue.

During the three months ended December 31, 2019, one customer accounted for 51% of netrevenue. During the nine months ended December 31, 2019, one customer accounted for 49% ofnet revenue.

As of December 31, 2020, three customers represented 82% of our gross accounts receivable. Asof March 31, 2020, three customers represented 83% of our gross accounts receivable.

The Company's customer base is comprised of foreign and domestic entities with diversedemographics. Net revenues from foreign customers for the three and nine months endedDecember 30, 2020 were $89,029 or 12% and $212,517 or 9%, respectively. Net revenues fromforeign customers for the three and nine months ended December 31, 2019 were $38,944 or 5%and $281,226 or 11%, respectively.


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9 Months EndedNote 7 - DisaggregatedRevenues and Segment

Information Dec. 31, 2020

Notes to FinancialStatementsRevenue from Contract withCustomer [Text Block]

NOTE 7 - DISAGGREGATED REVENUES AND SEGMENT INFORMATION

The following tables show the Company's revenues disaggregated by reportable segment and by product and service type:

Three months Ended December 31,2020 2019


673,615 766,182


89,029 38,944

Total Net Revenues $ 762,644 $ 805,126

Nine Months Ended December 31,2020 2019


2,046,305 2,311,512


212,517 281,226


Information about segments is as follows:









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9 Months EndedNote 8 - Accounts Receivable- Related Party Dec. 31, 2020

Notes to FinancialStatementsRelated Party TransactionsDisclosure [Text Block]

NOTE 8 – ACCOUNTS RECEIVABLE - RELATED PARTY

The Company has a $75,000 investment for approximately 23% of Qol Devices Inc. (Qol), whichis carried at cost and reported as a component of other assets in the accompanying consolidatedbalance sheets.

The Company provided $330,090 in engineering services to Qol during the year March 31, 2018.As of December 31, 2020, the Company reported a long term receivable as a component ofaccounts receivable - related party in the accompanying consolidated balance sheets.


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9 Months EndedNote 9 - Leases Dec. 31, 2020Notes to FinancialStatementsLessee, Operating and FinanceLeases [Text Block]

NOTE 9 – LEASES

We lease our office and manufacturing facility under a non-cancelable operating lease, which expires on June 30, 2028. Thefollowing is a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities as of December 31, 2020:




Rent and real estate tax expense for all facilities for the three and nine months ended December 31, 2020 and 2019 wasapproximately $34,000 and $103,000, respectively, and $34,000 and $101,000, respectively and are reported as a component ofcost of sales and selling, general and administrative expenses in the accompanying consolidated statements of operations. TheCompany paid in $76,397 in lease payments during the nine months ending December 31, 2020.

During September 2016 the Company leased equipment with a cost of approximately $129,000, under provisions of various long-term financing leases whereby the minimum lease payments have been capitalized. Accumulated depreciation at December 31,2020 is approximately $108,000. The leases expire over various years through 2021. Depreciation of the leased assets is includedin depreciation and amortization expense. The lease obligations are secured by the leased assets.


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9 Months EndedNote 10 - Payroll ProtectionProgram (PPP) Loan Dec. 31, 2020

Notes to FinancialStatementsLong-term Debt [Text Block] NOTE 10 – PAYROLL PROTECTION PROGRAM (PPP) Loan

The World Health Organization characterized the COVID-19 virus as a global pandemic onMarch 11, 2020. The duration and economic impact of this pandemic are uncertain. Theeconomic impact depends on future developments and the financial condition of our customersthat we may not be able to foresee. Any of these factors, and other factors beyond our control, canadversely impact our results for the full fiscal year and such impact may be material. Due to theglobal pandemic, the Company experienced a decrease in sales due to the following: certainmajor customers were not in operation due to the temporary shutdown for several months orexperienced a significant decrease in demand due to the stay at home orders and a decrease inelective surgeries and other medical procedures during the period. At this time, management isunable to quantify its potential effects on the operations and financial performance of theCompany.

On May 6, 2020, the Company received loan proceeds in the amount of approximately $381,000under the Small Business Administration ("SBA") Paycheck Protection Program (“PPP”). ThePPP, will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, andutilities, with at least 60% being used for payroll. Forgiveness will be reduced if full-timeheadcount declines, or if salaries and wages decrease. Principal and interest payments on anyunforgiven portion of the PPP will be deferred to the date the SBA remits the borrower's loanforgiveness amount to the lender or, if the borrower does not apply for loan forgiveness, 10months after the end of the borrower's loan forgiveness covered period. This loan has an interestrate of 1% and a maturity of 2 years, which can be extended to up to 5 years if the Company andlender agree. No collateral or personal guarantees were required for the loan.

The Company has used the entire PPP loan proceeds for designated qualifying expenses andintends to apply for forgiveness of the PPP loan in accordance with the terms of the PPP. Noassurance can be given that the Company will obtain forgiveness of the PPP loan in whole or inpart. With respect to any portion of the PPP loan that is not forgiven, the PPP will be subject tocustomary provisions for a loan of this type, including customary events of default relating to,among other things, payment defaults, breaches of the provisions of the PPP note and crossdefaults.


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9 Months EndedNote 11 - Line of Credit Dec. 31, 2020Notes to FinancialStatementsDebt Disclosure [Text Block] NOTE 11 – LINE OF CREDIT

On June 15, 2018, the Company obtained an unsecured revolving line of credit, with a limit of$400,000. The line expires May 15, 2021, renewing automatically every year. The Company isrequired to make monthly interest payments, at a rate of 3.870% as of December 31, 2020. Anyunpaid principal will be due upon maturity. At December 31, 2020 and March 31, 2020, theoutstanding balance was $85,000 and $30,000, respectively.


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9 Months EndedNote 12 - Income Taxes Dec. 31, 2020Notes to FinancialStatementsIncome Tax Disclosure [TextBlock]

NOTE 12 - INCOME TAXES

At December 31, 2020, the Company had federal net operating loss carry-forwards ("NOLs") ofapproximately $2,515,000. These NOLs may be used to offset future taxable income and therebyreduce or eliminate our federal income taxes otherwise payable. A valuation allowance isprovided when it is more likely than not that some portion or all of the deferred tax assetswill not be realized. Ultimate utilization of such NOLs and research and development credits isdependent upon the Company's ability to generate taxable income in future periods and may besignificantly curtailed if a significant change in ownership occurs.

During the nine months ended December 31, 2020, the Company generated approximately$228,000 of the net operating losses, and expects to utilize the NOL's before expiration.

The effective tax rates were approximately 4% and (290)% for the nine months ended December31, 2020 and 2019, respectively.


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9 Months EndedNote 13 - Stock BasedCompensation Dec. 31, 2020

Notes to FinancialStatementsShare-based PaymentArrangement [Text Block]

NOTE 13 – STOCK BASED COMPENSATION

On January 13, 2020, ADM granted 300,000 stock options to one employee at an exercise price of $0.20 per option with a term oftwo years subject to vesting in four equal amounts of 75,000 shares every six months. The options were valued at $35,206 usingthe Black Scholes option pricing model with the following assumptions: risk free interest rate of 1.58%, volatilityof 132%, estimated useful life of 3 years and dividend rate of 0%.

The following table summarizes information on all common share purchase options issued by us as of December 31,2020 and 2019.



Price Price


Issued - - - -

Exercised - - - -

Expired - - - -



The following table summarizes the information about nonvested options for the nine months ended December 31, 2020:

OptionsWeightedAverage




Stock based compensation related to the vested options was $8,802 and $0 for the nine months ended December 31, 2020 and2019, respectively.

As of December 31, 2020, there was $26,404 of unrecognized compensation costs, which is expected to be recognized as follows:


$ 26,404


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9 Months EndedNote 14 - Due to Stockholder Dec. 31, 2020Notes to FinancialStatementsCompensation Related Costs,General [Text Block]

NOTE 14 – DUE TO STOCKHOLDER

The Company's President has been deferring his salary and bonuses periodically to assist theCompany's cash flow. There are no repayment terms or interest accruing on this liability.


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9 Months EndedNote 15 - Legal Proceedings Dec. 31, 2020Notes to FinancialStatementsLegal Matters andContingencies [Text Block]

NOTE 15 – LEGAL PROCEEDINGS

In November 2019, the Company filed a civil suit in the Superior Court of New Jersey against anaccounting firm seeking a declaratory judgement from the court that no sum is due to theaccounting firm, plus damages, attorney's fees and costs with respect to the foregoing. Thismatter was settled by mutual agreement for the Company to pay $7,500 to the defendant. Allclaims were dismissed by both parties on June 2, 2020.

We are involved, from time to time, in litigation and proceedings arising out of the ordinarycourse of business. Other than the foregoing, there are no pending material legal proceedings orenvironmental investigations to which we are a party or to which our property is subject.


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9 Months EndedNote 16 - Subsequent Events Dec. 31, 2020Notes to FinancialStatementsSubsequent Events [TextBlock]

NOTE 16 – SUBSEQUENT EVENTS

We evaluated all subsequent events from the date of the condensed consolidated balance sheetthrough the issuance date and determined that there are no events or transactions occurring duringthe subsequent event reporting period which require recognition or disclosure in the condensedconsolidated financial statements.


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9 Months EndedSignificant AccountingPolicies (Policies) Dec. 31, 2020

Accounting Policies[Abstract]Consolidation, Policy [PolicyText Block]



Use of Estimates, Policy[Policy Text Block]

USE OF ESTIMATES


Fair Value of FinancialInstruments, Policy [PolicyText Block]



Cash and Cash Equivalents,Policy [Policy Text Block]


Cash equivalents are comprised of highly liquid investments with original maturities of three months or less when purchased. Wemaintain our cash in bank deposit accounts, which at times, may exceed federally insured limits. We have not experienced anylosses to date as a result of this policy. Cash and cash equivalents held in these accounts are currently insured by the FederalDeposit Insurance Corporation (“FDIC”) up to a maximum of $250,000. At December 31, 2020, approximately $1,303,000exceeded the FDIC limit.

Receivable [Policy TextBlock]


Accounts receivable are stated at the amount management expects to collect from outstanding balances. The carrying amounts ofaccounts receivable is reduced by a valuation allowance that reflects management's best estimate of the amounts that will not becollected. Management individually reviews all accounts receivable balances that exceed the due date and estimates the portion, ifany, of the balance that will not be collected. Management provides for probable uncollectible amounts through a charge toexpenses and a credit to a valuation allowance, based on its assessment of the current status of individual accounts. Balances thatare still outstanding after management has used reasonable collection efforts are written off through a charge to the valuationallowance and a credit to accounts receivable.

Revenue [Policy Text Block] REVENUE RECOGNITION

ELECTRONICS:

We recognize revenue from the sale of our electronic products when they are shipped to the purchaser. We offer a limited 90-daywarranty on our electronics products and contract manufacturing, and a limited 5-year warranty on our electronic controllers forspas and hot tubs. Historically, the amount of warranty revenue included in sales of our electronic products have been de minimus.We have no other post shipment obligations. For contract manufacturing, revenues are recognized after shipments of the completedproducts.


CHEMICAL PRODUCTS:

Revenues are recognized when products are shipped to end users. Shipments to distributors are recognized as revenuewhen no right of return exists.


We provide certain engineering services, including research, development, quality control, and quality assurance services alongwith regulatory compliance services. We recognize revenue from engineering services on a monthly basis over time as theapplicable performance obligations are satisfied.

All revenue is recognized net of discounts.Guarantees, Indemnificationsand Warranties Policies[Policy Text Block]


The Company's provision for estimated future warranty costs is based upon historical relationship of warranty claims to sales.Based upon historical experience, the Company has concluded that no warranty liability is required as of thecondensed consolidated balance sheet dates. However, the Company periodically reviews the adequacy of its product warrantiesand will record an accrued warranty reserve if necessary. Based on prior experience, no amounts have been accrued for potentialwarranty costs and actual costs were less than $2,000, for the three and nine months ended December 31, 2020 and 2019.


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Inventory, Policy [Policy TextBlock]

INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out method) and net realizable value. Inventories that are expected to besold within one operating cycle (1 year) are classified as a current asset. Inventories that are not expected to be sold within 1 year,based on historical trends, are classified as Inventories - long term portion. Obsolete inventory is written off based on prior andexpected future usage.

Property, Plant andEquipment, Policy [PolicyText Block]


We record our property and equipment at historical cost. We expense maintenance and repairs as incurred. Depreciation isprovided for by the straight-line method over five to seven years, the estimated useful lives of the property and equipment.

Debt, Policy [Policy TextBlock]


The Company has obtained a Paycheck Protection Program loan during May 2020 from the Small Business Administration in theamount of $381,000. Management has elected to record the loan under FASB ASC 470, Debt and in the event the Company issuccessful in receiving forgiveness, will treat the qualifying amounts as a gain upon extinguishment in accordance with ASC 405,Liabilities. As of December 31, 2020, management believes that all expenses have met the criteria of qualifying expenses as setforth by the terms of the loan.

Intangible Assets, Finite-Lived, Policy [Policy TextBlock]

INTANGIBLE ASSETS

Intangible assets are reviewed for impairment annually whenever changes in circumstances indicate that the carrying amountmay not be recoverable. In reviewing for impairment, the Company compares the carrying value of the relevant asset to theestimated undiscounted future cash flows expected from the use of the assets and their eventual disposition. When the estimatedundiscounted future cash flows are less than their carrying amount, an impairment loss is recognized equal to the differencebetween the assets' fair value and its carrying value. Although the Company experienced a decrease in sales due to the COVID-19pandemic, there is no impairment loss for the nine months ended December 31, 2020.

Advertising Cost [Policy TextBlock]

ADVERTISING COSTS


Income Tax, Policy [PolicyText Block]

INCOME TAXES

We report the results of our operations as part of a consolidated Federal tax return with our subsidiary. Deferred income taxesresult primarily from temporary differences between financial and tax reporting. Deferred tax assets and liabilities are determinedbased on the difference between the financial statement basis and tax basis of assets and liabilities using enacted tax rates. Avaluation allowance is recorded to reduce a deferred tax asset to that portion that is expected to more likely than not be realized.

The Company has adopted the authoritative accounting guidance with respect to accounting for uncertainty in income taxes, whichclarified the accounting and disclosures for uncertain tax positions related to income taxes recognized in the consolidated financialstatements and addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should berecorded in the consolidated financial statements. The Company recognizes the financial statement benefit of a tax position onlyafter determining that the relevant tax authority would more likely than not sustain the position following an audit. For taxpositions meeting the more-likely-than-not threshold, the amount recognized in the consolidated financial statements is the largestbenefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

The Company files income tax returns in several jurisdictions. The Company's tax returns remain subject to examination, by majorjurisdiction, for the years ended March 31, as follows:



The Company will recognize interest and penalties accrued on any unrecognized tax benefits as a component of income taxexpense. As of December 31, 2020, and 2019, the Company has no accrued interest or penalties related to uncertain tax positions.

Earnings Per Share, Policy[Policy Text Block]


We compute basic earnings per share by dividing net income/loss by the weighted average number of common shares outstanding.Diluted earnings per share is computed similar to basic earnings per share, except that the denominator is increased to include thenumber of additional common shares that would have been outstanding if the potential shares had been issued and if the additionalshares were dilutive. Common equivalent shares are excluded from the computation of net earnings per share if their effect is anti-dilutive.

Per share basic and diluted earnings amounted to $(0.00) for the three and nine months ended December 31, 2020 and December31, 2019, respectively.

Lessee, Leases [Policy TextBlock]

LEASES

In February 2016, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which changes financialreporting as it relates to leasing transactions. Under the new guidance, lessees are required to recognize a lease liability, measuredon a discounted basis; and a right-of-use asset, for the lease term. The Company adopted this guidance as of April 1, 2019, usingthe modified retrospective approach which allowed it to initially apply the guidance as of the adoption date. The Company electedthe package of practical expedients available under the new standard, which allowed the Company to forgo a reassessment of (1)


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whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and(3) the initial direct costs for any existing leases.


The Company's lease agreement contains related non-lease components (e.g. taxes, etc.). The Company separates leasecomponents and non-lease components for all underlying asset classes.

The adoption of this guidance had a material impact on the Company's Condensed Consolidated Balance Sheet beginning April 1,2019, when the Company recognized (a) a lease liability of $771,098, which represents the present value of the remaining leasepayments of $967,344, discounted using the Company's incremental borrowing rate of 5% and (b) the related right-of-use asset of$771,098, which represents the lease liability. Prior periods were not restated. Adoption of this standard had no change onfinancing leases previously subject to capital lease treatment under ASC Topic 840, Leases. See Note 9 for further discussion ofleases.

The Company determines if a contractual arrangement is a lease at inception. Operating leases are included in operating leaseright-of-use (“ROU”) assets, operating lease liability – current, and operating lease liability – noncurrent on the Company'scondensed consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term andlease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets andliabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.The lease payments included in the present value are fixed lease payments. As most of the Company's leases do not provide animplicit rate, the Company estimates its collateralized incremental borrowing rate, based on information available at thecommencement date, in determining the present value of lease payments. The operating lease ROU assets include any paymentsmade before the commencement date and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Reclassification,Comparability Adjustment[Policy Text Block]

RECLASSIFICATION


New AccountingPronouncements, Policy[Policy Text Block]


In June 2016, the FASB issued ASU-2016-13 “Financial Instruments – Credit Losses”. This guidance affects organizations thathold financial assets and net investments in leases that are not accounted for at fair value with changes in fair value reported in netincome. The guidance requires organizations to measure all expected credit losses for financial instruments at the reporting datebased on historical experience, current conditions and reasonable and supportable forecasts. It is effective for fiscal yearsbeginning after December 15, 2019. The Company adopted this ASU as of April 1, 2020 and it has no impact on the Company'sconsolidated financial statements.

Management does not believe that any other recently issued, but not yet effective accounting pronouncement, if adopted, wouldhave a material effect on the accompanying consolidated financial statements.


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9 Months EndedNote 2 - SignificantAccounting Policies (Tables) Dec. 31, 2020Notes TablesSummary of Income TaxContingencies [Table TextBlock]



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9 Months EndedNote 3 - Inventories (Tables) Dec. 31, 2020Notes TablesSchedule Of Inventory [TableText Block]




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9 Months EndedNote 4 - Property andEquipment (Tables) Dec. 31, 2020

Notes TablesProperty, Plant and Equipment[Table Text Block]

December 31,2020

March 31,2020


203,560 203,560




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9 Months EndedNote 5 - Intangible Assets(Tables) Dec. 31, 2020

Notes TablesSchedule of Finite-LivedIntangible Assets [Table TextBlock]


Cost






NetCarryingAmount


Schedule of Finite-LivedIntangible Assets, FutureAmortization Expense [TableText Block]




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9 Months EndedNote 7 - DisaggregatedRevenues and SegmentInformation (Tables) Dec. 31, 2020

Notes TablesRevenue from ExternalCustomers by GeographicAreas [Table Text Block]

Three months Ended December 31,2020 2019


673,615 766,182


89,029 38,944

Total Net Revenues $ 762,644 $ 805,126Nine Months Ended December 31,

2020 2019Net Revenue in the USChemical $ 737,057 $ 814,317Electronics 955,217 866,091Engineering 354,031 631,104

2,046,305 2,311,512


212,517 281,226


Schedule of SegmentReporting Information, bySegment [Table Text Block]









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9 Months EndedNote 9 - Leases (Tables) Dec. 31, 2020Notes TablesLessee, Operating Lease,Liability, Maturity [Table TextBlock]





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9 Months EndedNote 13 - Stock BasedCompensation (Tables) Dec. 31, 2020

Notes TablesShare-based PaymentArrangement, Option, Activity[Table Text Block]



Price Price


Issued - - - -

Exercised - - - -

Expired - - - -



Schedule of Nonvested ShareActivity [Table Text Block] Options

WeightedAverage




Schedule of UnrecognizedCompensation Costs [TableText Block]


$ 26,404


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3 Months Ended 9 Months EndedNote 2 - SignificantAccounting Policies (Details

Textual) - USD ($)$ / shares in Thousands

May 06,2020

Dec. 31,2020

Dec. 31,2019

Dec. 31,2020

Dec. 31,2019

Apr. 01,2019

Cash, Uninsured Amount $1,303,000

$1,303,000

Contract with Customer, Liability, RevenueRecognized 215,000

Proceeds from Notes Payable, Total 381,000Impairment of Intangible Assets, Finite-lived 0Advertising Expense 6,079 $ 25,779 9,936 33,108Unrecognized Tax Benefits, Income Tax Penaltiesand Interest Accrued, Total $ 0 $ 0 $ 0 $ 0

Earnings Per Share, Basic and Diluted, Total (indollars per share) $ 0 $ 0 $ 0 $ 0

Operating Lease, Liability, Total $ 655,547 $ 655,547Lessee, Operating Lease, Liability, to be Paid, Total $ 789,062 $ 789,062Operating Lease, Weighted Average Discount Rate,Percent 5.00% 5.00%

Accounting Standards Update 2016-02 [Member]Operating Lease, Liability, Total $

771,098Lessee, Operating Lease, Liability, to be Paid, Total $

967,344Operating Lease, Weighted Average Discount Rate,Percent 5.00%

Paycheck Protection Program CARES Act[Member]Proceeds from Notes Payable, Total $

381,000Maximum [Member]Product Warranty Expense $ 2,000 $ 2,000Property, Plant and Equipment, Useful Life (Year) 7 yearsMinimum [Member]Property, Plant and Equipment, Useful Life (Year) 5 yearsElectronic Products [Member]Warranty Term (Day) 90 daysElectronic Controllers for Spas and Hot Tubs[Member]Warranty Term (Day) 5 years


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12 Months EndedNote 2 - SignificantAccounting Policies - Tax

Returns Subject toExamination (Details)

Mar. 31, 2020

Domestic Tax Authority [Member]Open tax year 2015 2016 2017 2018 2019 2020State and Local Jurisdiction [Member] | New Jersey Division of Taxation[Member]Open tax year 2014 2015 2016 2017 2018 2019

2020


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Note 3 - Inventories -Summary of Inventory

(Details) - USD ($)Dec. 31, 2020 Mar. 31, 2020

Raw materials $ 502,239 $ 410,382Finished goods 77,873 94,333Totals 580,112 504,715Current [Member]Raw materials 381,226 289,369Finished goods 66,806 83,266Totals 448,032 372,635Long Term [MemberRaw materials 121,013 121,013Finished goods 11,067 11,067Totals $ 132,080 $ 132,080


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Note 4 - Property andEquipment - Property andEquipment (Details) - USD

($)

Dec. 31, 2020 Mar. 31, 2020Mar. 31, 2019

Machinery and equipment $ 199,810 $ 199,810Leasehold improvements 3,750 3,750Property and equipment 203,560 203,560Accumulated depreciation and amortization (173,275) $ (145,602) (145,602)Property and equipment, net $ 30,285 $ 57,958 $ 57,958


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9 Months EndedNote 5 - Intangible Assets(Details Textual) Dec. 31, 2020

Finite-Lived Intangible Assets, Remaining Amortization Period (Year) 6 yearsMinimum [Member]Finite-Lived Intangible Asset, Useful Life (Year) 10 yearsMaximum [Member]Finite-Lived Intangible Asset, Useful Life (Year) 15 years


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9 Months Ended 12 Months EndedNote 5 - Intangible Assets -Intangible Assets (Details) -

USD ($) Dec. 31, 2020 Mar. 31, 2020

Accumulated Amortization $ (16,151) $ (14,091)Net Carrying Amount 19,643 21,703Patents And Trademarks [Member]Cost 35,794 $ 35,794Weighted Average Amortization Period (Years) (Year) 15 yearsAccumulated Amortization $ (16,151) $ (14,091)Patents And Trademarks [Member] | Minimum [Member]Weighted Average Amortization Period (Years) (Year) 15 yearsNet Carrying Amount $ 21,703Patents And Trademarks [Member] | Maximum [Member]Net Carrying Amount $ 19,643


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Note 5 - Intangible Assets -Estimated Aggregate Future

Amortization Expense(Details) - USD ($)

Dec. 31, 2020 Mar. 31, 2020

2021 $ 2,8822022 2,8822023 2,8822024 2,6322025 2,077Thereafter 6,288Finite-Lived Intangible Assets, Net, Ending Balance $ 19,643 $ 21,703


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3 MonthsEnded 9 Months Ended 12 Months

EndedNote 6 - Concentrations

(Details Textual)Dec. 31,

2020USD($)

Dec. 31,2019USD($)

Dec. 31,2020

USD ($)

Dec. 31,2019

USD ($)

Mar. 31,2020

Revenue from Contract with Customer, Including AssessedTax

$762,644

$805,126

$2,258,822

$2,592,738

Customer Concentration Risk [Member] | Revenue Benchmark[Member] | Two Customers [Member]Concentration Risk, Number of Customers 2 2Concentration Risk, Percentage 52.00% 51.00%Customer Concentration Risk [Member] | Revenue Benchmark[Member] | One Customer [Member]Concentration Risk, Number of Customers 1 1Concentration Risk, Percentage 51.00% 49.00%Customer Concentration Risk [Member] | Revenue Benchmark[Member] | Foreign Customers [Member]Concentration Risk, Percentage 12.00% 5.00% 9.00% 11.00%Revenue from Contract with Customer, Including AssessedTax

$89,029

$38,944 $ 212,517$ 281,226

Customer Concentration Risk [Member] | Accounts Receivable[Member] | Three Customers [Member]Concentration Risk, Number of Customers 3 3Concentration Risk, Percentage 82.00% 83.00%


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3 Months Ended 9 Months EndedNote 7 - DisaggregatedRevenues and Segment

Information - Net Revenue,Classified by Geography

(Details) - USD ($)

Dec. 31, 2020 Dec. 31, 2019 Dec. 31, 2020 Dec. 31, 2019

Net revenues $ 762,644 $ 805,126 $ 2,258,822 $ 2,592,738Chemical [Member]Net revenues 352,484 295,262 949,574 1,095,543Electronics [Member]Net revenues 270,245 430,114 955,217 866,091Engineering [Member]Net revenues 139,915 79,750 354,031 631,104UNITED STATESNet revenues 673,615 766,182 2,046,305 2,311,512UNITED STATES | Chemical [Member]Net revenues 263,455 256,318 737,057 814,317UNITED STATES | Electronics [Member]Net revenues 270,245 430,114 955,217 866,091UNITED STATES | Engineering [Member]Net revenues 139,915 79,750 354,031 631,104Non-US [Member]Net revenues 89,029 38,944 212,517 281,226Non-US [Member] | Chemical [Member]Net revenues 89,029 38,944 212,517 281,226Non-US [Member] | Electronics [Member]Net revenuesNon-US [Member] | Engineering [Member]Net revenues


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3 Months Ended 9 Months EndedNote 7 - DisaggregatedRevenues and Segment

Information - Summary ofSegment Information

(Details) - USD ($)

Dec. 31,2020

Dec. 31,2019

Dec. 31,2020

Dec. 31,2019

Mar. 31,2020

Revenue from Contract with Customer, IncludingAssessed Tax $ 762,644 $ 805,126 $

2,258,822$2,592,738

Segment operating income (loss) (76,721) (65,724) (255,225) (40,187)Total assets 5,112,437 5,112,437 $ 5,053,089Chemical [Member]Revenue from Contract with Customer, IncludingAssessed Tax 352,484 295,262 949,574 1,095,543

Segment operating income (loss) (14,585) 68,392 (70,895) 100,659Total assets 2,096,098 2,096,098 2,021,235Electronics [Member]Revenue from Contract with Customer, IncludingAssessed Tax 270,245 430,114 955,217 866,091

Segment operating income (loss) (83,033) (114,589) (259,137) (200,973)Total assets 2,198,349 2,198,349 1,970,705Engineering [Member]Revenue from Contract with Customer, IncludingAssessed Tax 139,915 79,750 354,031 631,104

Segment operating income (loss) 20,897 $ (19,527) 74,807 $ 60,127Total assets $ 817,990 $ 817,990 $ 1,061,149


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12 Months EndedNote 8 - Accounts Receivable- Related Party (Details

Textual) - USD ($) Mar. 31, 2018 Dec. 31, 2020

Qol [Member] | Engineering Services [Member]Related Party Transaction, Amounts of Transaction $ 330,090Qol [Member]Equity Method Investments $ 75,000Equity Method Investment, Ownership Percentage 23.00%


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3 Months Ended 9 Months EndedNote 9 - Leases (DetailsTextual) - USD ($) Dec. 31,

2020Dec. 31,

2019Dec. 31,

2020Dec. 31,

2019Sep. 30,

2016Operating Lease, Payments $ 76,397Finance Lease, Right-of-Use Asset, after AccumulatedAmortization, Total $ 129,000

Finance Lease, Right-of-Use Asset, AccumulatedAmortization $ 108,000 108,000

Selling, General and Administrative Expenses [Member]Operating Lease, Expense $ 34,000 $ 34,000 $ 103,000 $ 101,000


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Note 9 - Leases - FutureMinimum Lease Payments

(Details)

Dec. 31, 2020USD ($)

2021 $ 101,8752022 101,8752023 104,3752024 106,8752025 106,875Thereafter 267,187Lessee, Operating Lease, Liability, to be Paid, Total 789,062Less: Amount attributable to imputed interest (133,515)Net liability at December 31, 2020 $ 655,547Weighted average remaining lease term (in years) (Year) 8 yearsWeighted average discount rate 5.00%


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9 Months EndedNote 10 - Payroll ProtectionProgram (PPP) Loan

(Details Textual) - USD ($) May 06, 2020 Dec. 31, 2020 Dec. 31, 2019

Proceeds from Notes Payable, Total $ 381,000Paycheck Protection Program CARES Act [Member]Proceeds from Notes Payable, Total $ 381,000


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Note 11 - Line of Credit(Details Textual) - RevolvingCredit Facility [Member] -

USD ($)

Jun. 15, 2018 Dec. 31, 2020 Mar. 31, 2020

Line of Credit Facility, Maximum Borrowing Capacity $ 400,000Debt Instrument, Interest Rate, Stated Percentage 3.87%Short-term Debt, Total $ 85,000 $ 30,000Line of Credit Facility, Expiration Date May 15, 2021


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9 Months EndedNote 12 - Income Taxes(Details Textual) - USD ($) Dec. 31, 2020 Dec. 31, 2019

Operating Loss Carryforwards, Total $ 2,515,000Operating Loss Carry-Forward, Amount Utilized $ 228,000Effective Income Tax Rate Reconciliation, Percent, Total 4.00% (290.00%)


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3 MonthsEnded

9 MonthsEndedNote 13 - Stock Based

Compensation (DetailsTextual) - USD ($) Jan. 13,

2020

Dec.31,

2020

Dec.31,

2019

Dec.31,

2020

Dec.31,

2019Share-based Compensation Arrangement by Share-based Payment Award,Options, Grants in Period, Gross (in shares) 300,000

Share-based Compensation Arrangements by Share-based Payment Award,Options, Grants in Period, Weighted Average Exercise Price (in dollars pershare)

$ 0.20

Share-based Compensation Arrangement by Share-based Payment Award,Expiration Period (Year) 2 years

Share-based Compensation Arrangement by Share-based Payment Award,Options, Vested in Period, Fair Value $ 35,206

Share-based Compensation Arrangement by Share-based Payment Award,Fair Value Assumptions, Risk Free Interest Rate 1.58%

Share-based Compensation Arrangement by Share-based Payment Award,Fair Value Assumptions, Expected Volatility Rate 132.00%

Share-based Compensation Arrangement by Share-based Payment Award,Fair Value Assumptions, Expected Term (Year) 3 years

Share-based Compensation Arrangement by Share-based Payment Award,Fair Value Assumptions, Expected Dividend Rate 0.00%

Share-based Payment Arrangement, Expense $8,802 $ 0

Share-based Payment Arrangement, Nonvested Award, Cost Not yetRecognized, Amount, Total

$26,404

$26,404

Vesting in Four Equal Amount Every Six Months [Member]Share-based Compensation Arrangement by Share-based Payment Award,Options, Grants in Period, Gross (in shares) 75,000


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9 Months EndedNote 13 - Stock BasedCompensation - Summary of

Stock Option Activity(Details) - $ / shares

Jan. 13, 2020 Dec. 31, 2020 Dec. 31, 2019

Outstanding, beginning of year (in shares) 300,000Outstanding, weighted average exercise price (in dollars per share) $ 0.20Issued (in shares) 300,000Issued, weighted average exercise price (in dollars per share) $ 0.20Exercised (in shares)Exercised, weighted average exercise price (in dollars per share)Expired (in shares)Expired, weighted average exercise price (in dollars per share)Outstanding, end of period (in shares) 300,000Outstanding, end of period (in dollars per share) $ 0.20Exercisable, end of period (in shares) 75,000Exercisable, end of period (in dollars per share) $ 0.20


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9 Months EndedNote 13 - Stock BasedCompensation - Nonvested

Options Activity (Details) - $/ shares

Jan. 13, 2020 Dec. 31, 2020 Dec. 31, 2019

Nonvested, options (in shares) 300,000Nonvested, weighted average exercise price (in dollars per share)Granted, options (in shares) 300,000Granted, weighted average exercise price (in dollars per share)Vested, options (in shares) (75,000)Vested, weighted average exercise price (in dollars per share) $ 0.20Cancelled, options (in shares)Cancelled, weighted average exercise price (in dollars per share)Forfeited, options (in shares)Forfeited, weighted average exercise price (in dollars per share)Nonvested, options (in shares) 225,000Nonvested, weighted average exercise price (in dollars per share)


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Note 13 - Stock BasedCompensation -

Unrecognized CompensationCosts (Details)

Dec. 31, 2020USD ($)

2021 $ 11,7352022 11,7352023 2,934Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total $ 26,404


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Note 14 - Due to Stockholder(Details Textual)$ in Thousands

Dec. 31, 2020USD ($)

Deferred Compensation Liability, Interest Accrued $ 0


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Note 15 - Legal Proceedings(Details Textual)

Jun. 02, 2020USD ($)

Civil Suit Against Accounting Firm [Member]Litigation Settlement, Amount Awarded to Other Party $ 7,500


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ADM TRONICS UNLIMITED, INC. Form 10-Q Quarterly Report Filed ...

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Transcript of ADM TRONICS UNLIMITED, INC. Form 10-Q Quarterly Report Filed ...