Note 2 - Liquidity and Going Concern

6 Months Ended

Sep. 30, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Substantial Doubt about Going Concern [Text Block]

Note 2 - Liquidity and Going Concern

These condensed consolidated financial statements have been prepared in conformity with GAAP, which contemplates continuation of the Company as a going concern. As discussed in Note 14 to the Notes to the Condensed Consolidated Financial Statements, the Company has recorded total damages of $4,900,000 as a result of the jury verdict associated with the Aeroflex litigation as well as the court’s decision on punitive damages. The jury found no misappropriation of Aeroflex trade secrets but it did rule that the Company tortiously interfered with a prospective business opportunity and awarded damages. The jury also ruled that Tel tortiously interfered with Aeroflex’s non-disclosure agreements with two former Aeroflex employees. The jury also found that the former Aeroflex employees breached their non-disclosure agreements with Aeroflex. The court conducted further hearings on the Company’s post-trial motions which sought to reduce the damages award, as well as the punitive damages claim.  The court denied the Company’s motions and awarded Aeroflex an additional $2.1 million of punitive damages,which brings the total Tel damages awarded in this case to approximately $4.9 million. No judgment has yet been entered by the court, and we have filed a motion with the court that these changes are duplicative and not supported by Kansas Law.

The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital to support the appeal process or pay any final damages amount and achieve profitable operations. In November 2017, the Company signed a subscription agreement in which the Company received $3 million for Series A Convertible Preferred Stock (See Note 16 to the Notes to the Condensed Financial Statements). These funds will be used to finance an appeal and provide funds for operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.