2. Liquidity	9 Months Ended
Sep. 30, 2019
Liquidity
Liquidity	On September 30, 2019 the Company had no bank debt on a $3.0 million asset-based credit line, approximately $2.3 million in cash and cash equivalents, and working capital of approximately $6.6 million. The Company’s credit line has a maturity date of November 30, 2019, and automatically renews on November 30 of each year unless cancelled under the terms of the agreement. The Company closed on a $5 million private placement and issued an aggregate of 4,545,455 shares on May 3, 2019, and soon after the closing of the offering Jeremy Hitchcock and Jonathan Seelig joined Zoom’s Board of Directors. Other major changes of cash during the first nine months of 2019 were decreases of approximately $1.6 million in inventory and $533 thousand in prepaid expenses; and increases in accounts payable and accrued expenses of approximated $494 thousand. Major items that decreased cash were a net loss of approximately $2.1 million, a reduction in debt of approximately $1.7 million, and an accounts receivable increase of approximately $2.0 million. The Company’s ability to maintain adequate levels of liquidity depends in part on our ability to sell inventory on hand and collect related receivables. The Company was profitable for the first nine months of 2018. Effective September 24, 2018, almost all of our products were subject to a 10% tariff because they are produced in China and they are in product categories subject to a 10% tariff on our cost of goods at the time of entry into the US. Effective June 15, 2019 almost all of our products have been subject to the tariff increase from 10% to 25%. This has a significant impact on our cost of inventory and profitability. Because these tariffs may not be reduced and may even be increased, we are actively working on finding production capability outside China. Our largest supplier is actively working on setting up a major production capability in Vietnam. Although the Company has recently experienced losses, it has continued to experience sales growth. The Company expects year-over-year growth due to a number of factors including the strength of the Motorola brand, new product introductions, increased shelf space, growing online retailer sales, and international expansion. Because of projected sales increases, the strength of its balance sheet, its unused line of credit, and efforts to move production capability outside of China, the Company expects to maintain acceptable levels of liquidity to meet its obligations as they become due for at least twelve months from the date of issuance of the Company’s Quarterly filing of this Form 10-Q with the Securities Exchange Commission.

2. Liquidity

9 Months Ended

Sep. 30, 2019

On September 30, 2019 the Company had no bank debt on a $3.0 million asset-based credit line, approximately $2.3 million in cash and cash equivalents, and working capital of approximately $6.6 million. The Company’s credit line has a maturity date of November 30, 2019, and automatically renews on November 30 of each year unless cancelled under the terms of the agreement.

The Company closed on a $5 million private placement and issued an aggregate of 4,545,455 shares on May 3, 2019, and soon after the closing of the offering Jeremy Hitchcock and Jonathan Seelig joined Zoom’s Board of Directors. Other major changes of cash during the first nine months of 2019 were decreases of approximately $1.6 million in inventory and $533 thousand in prepaid expenses; and increases in accounts payable and accrued expenses of approximated $494 thousand. Major items that decreased cash were a net loss of approximately $2.1 million, a reduction in debt of approximately $1.7 million, and an accounts receivable increase of approximately $2.0 million.

The Company’s ability to maintain adequate levels of liquidity depends in part on our ability to sell inventory on hand and collect related receivables. The Company was profitable for the first nine months of 2018. Effective September 24, 2018, almost all of our products were subject to a 10% tariff because they are produced in China and they are in product categories subject to a 10% tariff on our cost of goods at the time of entry into the US. Effective June 15, 2019 almost all of our products have been subject to the tariff increase from 10% to 25%. This has a significant impact on our cost of inventory and profitability. Because these tariffs may not be reduced and may even be increased, we are actively working on finding production capability outside China. Our largest supplier is actively working on setting up a major production capability in Vietnam. Although the Company has recently experienced losses, it has continued to experience sales growth. The Company expects year-over-year growth due to a number of factors including the strength of the Motorola brand, new product introductions, increased shelf space, growing online retailer sales, and international expansion. Because of projected sales increases, the strength of its balance sheet, its unused line of credit, and efforts to move production capability outside of China, the Company expects to maintain acceptable levels of liquidity to meet its obligations as they become due for at least twelve months from the date of issuance of the Company’s Quarterly filing of this Form 10-Q with the Securities Exchange Commission.