Item 8.01
Other Events
Relying
on the SEC Order for Reporting Relief
InnerScope
Hearing Technologies, Inc., a Nevada corporation (the “Company”) makes the following disclosure pursuant to
an order issued by the U.S. Securities and Exchange Commission (the “SEC”) on March 4, 2020, providing conditional
relief to public companies that are unable to timely comply with their filing obligations as a result of the novel coronavirus
(COVID-19) outbreak (the “SEC Order”).
The current
outbreak of COVID-19 has posed a significant impact on the Company to file on a timely basis its Annual Report on Form 10-K for
the year ended December 31, 2019 (the “Annual Report”) that is due March 30, 2020 (the “Original Due
Date”), and therefore the Company elected to rely on the conditional filing relief provided under the SEC Order.
In response
to the government’s call to contain COVID-19 and to protect our employees’ health, employees have had very limited
access to our offices. Our accounting team, professional advisors and independent auditors have not been able to prepare for and
conduct on-site accounting and auditing work. Considering the lack of time for the compilation, dissemination and review of the
information required to be presented and the importance of markets and investors receiving materially accurate information in
the Annual Report, we have decided to rely on the SEC Order and endeavor to file the Annual Report no later than May 14, 2020,
or within 45 days after the Original Due Date.
In light
of the current COVID-19 pandemic, the Company will be including the following Risk Factors in its Report:
The
outbreak of the coronavirus (COVID-19) has negatively impacted and could continue to negatively impact the global economy. In
addition, the COVID-19 outbreak could disrupt or otherwise negatively impact global credit markets and our operations, including
the demand for our products and our ability and the ability of our third-party contract manufacturers to manufacture and deliver
our products.
The COVID-19
outbreak has negatively impacted and could continue to negatively impact the global economy. In addition, the global and regional
impact of the outbreak, including official or unofficial quarantines and governmental restrictions on activities taken in response
to such event, could limit our ability and the ability of our third party manufacturers to manufacture and deliver our products,
which would have a material adverse impact on our business, financial condition, results of operations and cash flows. The impact
of the COVID-19 outbreak could include voluntary or mandatory closures of our facilities, interruptions in our supply chain, which
could impact the cost or availability of products, restrictions on our ability to deliver our products, closures of our retail
locations and labor shortages. The COVID-19 outbreak could result in reduced consumer demand for our products due to reduced consumer
traffic in locations where our products are sold. The COVID-19 outbreak could disrupt or otherwise negatively impact credit markets,
which could adversely affect the availability and cost of capital. Such impacts could limit our ability to fund our operations
and satisfy our obligations. The extent and potential short and long term impact of the COVID-19 outbreak on our operational and
financial performance will depend on future developments, including the duration, severity and spread of the virus, actions that
may be taken by governmental authorities and the impact on our supply chain, operations, workforce and the financial markets,
all of which are highly uncertain and cannot be predicted.
The
occurrence of the COVID-19 pandemic may negatively affect our ability to meet our filing obligations with the Securities and Exchange
Commission depending on the severity and longevity of the pandemic.
A pandemic typically results in social distancing, travel bans and quarantine,
and this may limit access to our facilities, customers, management, support staff, professional advisors and our independent auditors.
These factors, in turn, may not only impact our operations, financial condition and demand for our goods and services but our
overall ability to react timely to mitigate the impact of this event. Also, it may hamper our efforts to comply with our filing
obligations with the Securities and Exchange Commission. Depending on the severity and longevity of the COVID-19 pandemic, our
business, customers, and shareholders may experience a significant negative impact.