What changed in this filing

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Item 1. Business

2025-09-16 compared with 2024-09-27 · 84 added, 84 removed, 170 unchanged (50% of the section changed)

29 unchanged sentences

the Company's total sales were $43,950,872 and $38,736,319, respectively.

Sales to five domestic customers accounted for 20%, 18%, 16%,

Sales to six customers accounted for 16%, 13%, 12%, 12%, 11%

and 10%, respectively, of total sales in 2025.

Sales to five domestic customers accounted for 23%, 18%, 16%, 13% and 11%, respectively,

of total sales in 2023.

Sales to five customers accounted for 20%, 18%, 16%, 16% and 11%, respectively, of total

sales in 2024.

This concentration level presents significant risk.

A loss of one of these customers or programs related to these

customers could significantly impact the financial performance of the Company.

Historically, a small number of customers have accounted

for a large percentage of the Company’s total sales in any given fiscal year.

In some instances, our sales may include shipments

to more than one business unit of a particular customer.

A loss of one of these customers or programs related to these customers

could significantly impact the financial performance of the Company.

Historically, a small number of customers have accounted for a large

percentage of the Company’s total sales in any given fiscal year.

In some instances, our sales may include shipments to more than

one business unit of a particular customer.

Export shipments in fiscal years 2025 and 2024

were $3,124,820 and $2,350,087, respectively.

The increase is primarily due to the increase in power supply shipments resulting

from a repeat order received which had no comparable shipments in the prior year.

The increase is primarily due to the increase in shipments on a large power supply contract

in the current year when compared to the same period last year.

Sources of Raw Materials.

3 unchanged sentences

number of sources.

Despite the risk associated with single or limited source suppliers, the benefits of higher quality goods minimize and often limit any potential risk and can eliminate problems with part failures during production.

At times, replacements

are required to cover obsolete parts.

Ongoing demand in the power electronics industry across

multiple manufacturing sectors continues to create shortages and extended lead times.

In some instances, waiting times for certain components

approach a year or more.

We adequately factor supplier-provided lead times into internal planning schedules and new customer quotations.

Despite the risk associated with single or limited source suppliers, the benefits of higher quality goods minimize

and often limit any potential risk and can eliminate problems with part failures during production.

At times, replacements are required

to cover obsolete parts.

Ongoing demand in the power electronics industry

across multiple manufacturing sectors continues to create shortages and extended lead times.

In some instances, waiting times for certain

components approach a year or more.

We adequately factor supplier-provided lead times into internal planning schedules and new customer

From time to time, we encounter part obsolescence which requires us to identify an alternate part suitable for use.

We continue to work

with our customers on strategies to mitigate any adverse impact upon our ability to service their requirements.

Factors which may arise

after the placement of the customer’s order may cause us to miss projected delivery dates.

Inflationary costs are expected to continue

but are not expected to have a significant impact on operating income in fiscal year 2025.

to work with our customers on strategies to mitigate any adverse impact upon our ability to service their requirements.

Factors which

may arise after the placement of the customer’s order may cause us to miss projected delivery dates.

Inflationary costs are expected

to continue but are not expected to have a significant impact on operating income in fiscal year 2026.

Tariffs on steel and aluminum imports from various

5 unchanged sentences

Sales Backlog

The total sales backlog at June 30, 2024 was $97.2

million, which included approximately $61 million from four significant customers, compared to $83.6 million at June 30, 2023, which

included approximately $66 million from six significant customers.

The total sales backlog at June 30, 2025 was approximately

$139.7 million, which included approximately $95.2 million from three significant customers, compared to $97.2 million at June 30, 2024,

which included approximately $61 million from four significant customers.

The Company’s total backlog represents the estimated remaining

2 unchanged sentences

procurement may originate from various divisions of the significant customer.

The funded portion of this backlog at June 30, 2024 was

approximately $94.9 million.

The funded portion of the backlog at June 30, 2025 was $106.6

This includes items that have been authorized and appropriated by Congress and/or funded by the customer.

The unfunded backlog at June 30, 2024 was approximately $2.3 million and represents an amount under one firm repeat multi-year order from

a single customer.

While there is no guarantee that future budgets and appropriations will provide funding for individual programs, management

has included in unfunded backlog only those programs that it believes are likely to receive funding based on discussions with customers

and program status.

The unfunded backlog at June 30, 2023 approximated $32 thousand.

Contracts are subject to modification, change or

cancellation, and the Company accounts for these changes as they are probable and estimable.

The Company evaluates the impact of any scope

modifications and will adjust reserves as information is known and estimable.

The majority of our orders are generated

from prime defense contractors, the United States Department of Defense, other agencies of the government of the United States and foreign

The unfunded backlog

at June 30, 2025 was $33 million, the majority of which represents amounts under multiple orders from a single customer.

While there is no guarantee that future budgets and appropriations will provide funding for individual programs, management has included

in unfunded backlog only those programs that it believes are likely to receive funding based on discussions with customers and program

The unfunded backlog at June 30, 2024 approximated $2.3 million.

Contracts are subject to modification, change or cancellation,

and the Company accounts for these changes as they are probable and estimable.

The Company evaluates the impact of any scope modifications

and will adjust reserves as information is known and estimable.

Contracts are generally not cancellable without penalty or recourse.

The majority of our orders are generated from

prime defense contractors, the United States Department of Defense, other agencies of the government of the United States and foreign

governments, and are for the design and development and/or manufacture of products.

1 unchanged sentence

for similar services.

It is not uncommon to receive orders which include delivery schedules extending beyond a year from the contract

purchase date, therefore a customer’s reorder point may vary.

It is presently anticipated that a minimum of

It is not uncommon to receive orders with delivery schedules extending beyond a year from the contract purchase

This can cause the time between a customer’s original purchase date and purchase date of their next order to vary.

It is presently anticipated that approximately

$49.1 million of orders comprising the June 30, 2025 backlog will be filled during the fiscal year ending June 30, 2026.

The estimate of

the June 30, 2024 backlog to be shipped in fiscal year 2025 is subject to future events, which may cause the amount of the backlog actually

shipped to differ from such estimate.

of the June 30, 2025 backlog to be shipped in fiscal year 2026 is subject to future events, which may cause the amount of the backlog

actually shipped to differ from such estimate.

Marketing and Competition

51 unchanged sentences

times, engineers are tasked with researching replacement parts to remediate identified obsolescence on current or repeat production programs.

The Company's expenditures for research related activities were approximately $86,714 and $65,427 in fiscal year 2024 and 2023, respectively.

The Company's expenditures for research related activities were approximately $71,074 and $86,714 in fiscal years 2025 and 2024, respectively.

The Company had 152 employees as of August 31,

1 unchanged sentence

The current collective

bargaining agreement expires on June 30, 2025.

bargaining agreement was ratified on July 1, 2025 and is set to expire on June 30, 2028.

Relations with the Union are considered good.

53 unchanged sentences

input from observed risks and threats, advisories, federal agencies and local law enforcement.

The Audit Committee of the Board of

Directors is responsible for oversight of our risk management processes.

The Audit Committee is briefed by senior management on cybersecurity

posture, initiatives and incidents.

The Audit Committee of the Board of Directors

is responsible for oversight of our risk management processes.

The Audit Committee is briefed by senior management on cybersecurity posture,

initiatives and incidents.

We allocate significant resources to mitigate these risks.

We are required to adhere to rigorous

regulations, such as those outlined in the Defense Federal Acquisition Regulation Supplement (DFARS), which govern the protection of

controlled unclassified information (CUI) and the mandatory reporting of cybersecurity incidents to the Department of Defense (DoD).

All DFARS requirements are flowed down to our sub-contractors, who are required to self-report their compliance to the U.S.

In addition to the processes and systems that we use to identify and mitigate risks, we utilize third party services to conduct valuations

of our security controls, including penetration testing and independent audits.

Despite our efforts to uphold the highest cybersecurity

standards, we may still experience a cybersecurity incident that has a material effect on business strategy, results of operation or

financial condition.

It is also possible that additional regulations could affect our supply chain and increase costs.

Prior cyberattacks

directed at us have not had a material impact on our financial results nor restricted us from being awarded contracts from other defense

companies or directly from the United States Department of Defense.

However, we can provide no assurance that the occurrence of any future

event would not adversely affect our internal operations, our reputation and competitive advantage, and our future financial results.

We are required to adhere to rigorous regulations,

such as those outlined in the Defense Federal Acquisition Regulation Supplement (DFARS), which govern the protection of controlled unclassified

information (CUI) and the mandatory reporting of cybersecurity incidents to the Department of Defense (DoD).

All DFARS requirements are

flowed down to our sub-contractors, who are required to self-report their compliance to the U.S.

In addition to the processes

and systems that we use to identify and mitigate risks, we utilize third party services to conduct valuations of our security controls,

including penetration testing and independent audits.

Despite our efforts to uphold the highest cybersecurity standards, we may still

experience a cybersecurity incident that has a material effect on business strategy, results of operation or financial condition.

is also possible that additional regulations could affect our supply chain and increase costs.

Prior cyberattacks directed at us have

not had a material impact on our financial results nor restricted us from being awarded contracts from other defense companies or directly

from the United States Department of Defense.

However, we can provide no assurance that the occurrence of any future event would not

adversely affect our internal operations, our reputation and competitive advantage, and our future financial results.

The Company's entire operation, including administrative,

manufacturing and engineering facilities, is located in Saratoga Springs, New York.

The Saratoga Springs plant, which the

Company owns, consists of various adjoining buildings on a 22 acre site, approximately eight acres of which is unimproved.

property is not subject to mortgage indebtedness or any other material encumbrance.

The plant has a sprinkler system throughout and

contains approximately 151,000 square feet of in-service floor space, of which 90,000 is used for manufacturing, 24,000 for

engineering, 33,000 for shipping and climatically secured storage, and 4,000 for offices.

The offices, engineering and some

manufacturing areas are air-conditioned.

In addition to assembly and wiring operations, the plant includes facilities for

varnishing, potting, impregnation and spray-painting operations.

The manufacturing operation also includes a complete machine shop,

with welding and sheet metal fabrication facilities adequate for substantially all of the Company's current operations.

normal test equipment, the Company maintains a sophisticated on-site environmental test facility.

In addition to meeting all of the

Company's in-house needs, the machine shop and environmental facilities are available to other companies on a contract basis.

The Saratoga Springs plant, which the Company

owns, consists of two buildings on a 22 acre site, approximately eight acres of which is unimproved.

The property is not subject to mortgage

indebtedness or any other material encumbrance.

The plant has a sprinkler system throughout and contains approximately 174,000 square

feet of in-service floor space, of which 113,000 is used for manufacturing, 24,000 for engineering, 33,000 for shipping and climatically

secured storage, and 4,000 for offices.

The offices, engineering and some manufacturing areas are air-conditioned.

In addition to assembly

and wiring operations, the plant includes facilities for varnishing, potting, impregnation and spray-painting operations.

The manufacturing

operation also includes a complete machine shop, with welding and sheet metal fabrication facilities adequate for substantially all of

the Company's current operations.

Besides normal test equipment, the Company maintains a sophisticated on-site environmental test facility.

In addition to meeting all of the Company's in-house needs, the machine shop and environmental facilities are available to other companies

on a contract basis.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business