NAPCO SECURITY TECHNOLOGIES, INC 10-K

ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. a. Financial Statements: Financial statements required pursuant to this Item are presented on pages FS-1 through FS-32 of this report as follows: ​ NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES ​ Page Report of Independent Registered Accounting Firm (PCAOB ID 34 ) FS-2 Report of Independent Registered Public Accounting Firm (PCAOB ID 23 ) FS-4 Consolidated Financial Statements: Consolidated Balance Sheets as of June 30, 2024 and 2023 FS-5 Consolidated Statements of Income for the Fiscal Years Ended June 30, 2024, 2023 and 2022 FS-6 Consolidated Statements of Stockholders' Equity for the Fiscal Years Ended June 30, 2024, 2023 and 2022 FS-7 Consolidated Statements of Cash Flows for the Fiscal Years Ended June 30, 2024, 2023 and 2022 FS-8 Notes to Consolidated Financial Statements FS-9 ​ ​ FS-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Napco Security Technologies, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Napco Security Technologies, Inc. and subsidiaries (the "Company") as of June 30, 2024, the related consolidated statements of income, stockholders' equity, and cash flows, for the year ended June 30, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2024, and the results of its operations and its cash flows for the year ended June 30, 2024, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of June 30, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated August 29, 2024, expressed an adverse opinion on the Company's internal control over financial reporting because of a material weakness. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Excess and Slow-Moving Inventory Reserve — Refer to Note 1 and 6 to the financial statements Critical Audit Matter Description Management records a reserve for excess and slow-moving inventory, which represents any excess of the cost of the inventory over its estimated net realizable value. The reserve is calculated using an estimated reserve percentage applied to the inventory based on age, historical trends, product life cycle, requirements to support forecasted sales, and the ability to find alternate applications of its raw materials and to convert finished product into alternate versions of the same product. The reserve for excess and slow-moving inventory was $5 million at June 30, 2024. FS-2 Table of Contents We identified the reserve for excess and slow-moving inventory as a critical audit matter because of the significant estimates and assumptions management makes to determine the reserve, specifically the reserve percentage and forecasted inventory usage. This required a high degree of auditor judgment when performing audit procedures to evaluate the reasonableness of management’s reserve for excess and slow-moving inventory. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the significant estimates and assumptions used in the excess and slow-moving inventory reserve included the following, among others: ● We tested the operating effectiveness of management’s internal controls over the determination of the inventory reserve. ● We evaluated the methods and assumptions used by management to estimate the inventory reserve by: o Testing the significant inputs used to determine the reserve percentage for accuracy and completeness. o Inquiring with production and engineering management of the Company as to specific products considered in the reserve, the product life cycles and corroborating alternate applications where applicable. o Comparing management’s forecasted usage with (1) historical inventory usage as well as forecasted sales, (2) internal communications to management and the Board of Directors, and (3) forecasted information included in Company press releases as well as in analyst and industry reports of the Company and companies in its peer group. o Evaluating management’s ability to accurately forecast inventory usage by comparing actual results to management’s historical forecasts. o Considering the impact of changes in the macroeconomic environment on management’s forecasted usage. o Testing the mathematical accuracy of management’s calculations. /s/ DELOITTE & TOUCHE LLP Jericho, New York August 29, 2024 ​ We have served as the Company's auditor since 2024. ​ FS-3 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the board of directors of Napco Security Technologies, Inc. and Subsidiaries: Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Napco Security Technologies, Inc. and Subsidiaries (the "Company") as of June 30, 2023, the related consolidated statements of income, stockholders’ equity, and cash flows, for each of the two years in the period ended June 30, 2023, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2023, and the results of its operations and its cash flows for each of the two years in the period ended June 30, 2023, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion The Company’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud in all material respects. Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinion. /s/ BAKER TILLY US, LLP We served as the Company's auditor from 2008 to 2023. ​ New York, New York September 8, 2023 ​ ​ FS-4 Table of Contents NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2024 ​ June 30, 2023 ​ ​ (in thousands, except share data) CURRENT ASSETS ​ ​ ​ Cash and cash equivalents ​ $ 65,341 ​ $ 35,955 Investments - other ​ ​ 26,980 ​ ​ 25,660 Marketable securities ​ ​ 5,398 ​ ​ 5,136 Accounts receivable, net of allowance for credit losses of $ 32 and $ 131 as of June 30, 2024 and June 30, 2023, respectively ​ 31,898 ​ 26,069 Inventories ​ 34,804 ​ 35,062 Income tax receivable ​ ​ 73 ​ ​ 75 Prepaid expenses and other current assets ​ 4,269 ​ 3,402 Total Current Assets ​ 168,763 ​ 131,359 Inventories - non-current ​ 15,109 ​ 13,287 Property, plant and equipment, net ​ 9,077 ​ 9,308 Intangible assets, net ​ 3,602 ​ 3,939 Deferred income taxes ​ ​ 5,428 ​ ​ 2,652 Operating lease - Right-of-use asset ​ ​ 5,487 ​ ​ 5,797 Other assets ​ 286 ​ 312 TOTAL ASSETS ​ $ 207,752 ​ $ 166,654 ​ ​ ​ ​ ​ ​ ​ CURRENT LIABILITIES ​ ​ ​ Accounts payable ​ $ 7,977 ​ $ 8,061 Accrued expenses ​ 10,345 ​ 8,079 Accrued salaries and wages ​ 3,907 ​ 3,546 Total Current Liabilities ​ 22,229 ​ 19,686 Accrued income taxes ​ 1,122 ​ 1,110 Operating lease liability ​ ​ 5,512 ​ ​ 5,689 TOTAL LIABILITIES ​ 28,863 ​ 26,485 COMMITMENTS AND CONTINGENCIES (Note 14) ​ ​ STOCKHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ Common Stock, par value $ 0.01 per share; 100,000,000 shares authorized as of June 30, 2024 and June 30, 2023; 39,768,186 and 39,663,812 shares issued; and 36,874,471 and 36,770,097 shares outstanding, respectively. ​ ​ 398 ​ ​ 397 Additional paid-in capital ​ 23,712 ​ 21,553 Retained earnings ​ 174,300 ​ 137,740 Less: Treasury Stock, at cost ( 2,893,715 shares) ​ ( 19,521 ) ​ ( 19,521 ) TOTAL STOCKHOLDERS’ EQUITY ​ 178,889 ​ 140,169 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY ​ $ 207,752 ​ $ 166,654 ​ See accompanying notes to consolidated financial statements. ​ FS-5 Table of Contents NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended June 30, ​ ​ 2024 2023 ​ 2022 ​ ​ (in thousands, except for share and per share data) Net sales: ​ ​ ​ ​ ​ ​ ​ ​ Equipment revenues ​ $ 113,071 $ 110,062 ​ $ 97,612 Service revenues ​ 75,749 ​ 59,935 ​ ​ 45,981 ​ ​ 188,820 ​ 169,997 ​ ​ 143,593 Cost of sales: ​ ​ ​ ​ Equipment-related expenses ​ 79,862 ​ 90,197 ​ ​ 78,471 Service-related expenses ​ 7,204 ​ 6,567 ​ ​ 5,966 ​ ​ 87,066 ​ 96,764 ​ ​ 84,437 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross Profit ​ 101,754 ​ 73,233 ​ ​ 59,156 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ 10,763 ​ 9,328 ​ ​ 8,024 Selling, general, and administrative expenses ​ 37,173 ​ 33,580 ​ ​ 32,907 Total Operating Expenses ​ 47,936 ​ 42,908 ​ ​ 40,931 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating Income ​ 53,818 ​ 30,325 ​ ​ 18,225 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other income: ​ ​ ​ ​ ​ ​ Interest and other income (expense), net ​ 2,568 ​ 903 ​ ​ ( 283 ) Gain on extinguishment of debt ​ ​ — ​ ​ — ​ ​ 3,904 Income before Provision for Income Taxes ​ 56,386 ​ 31,228 ​ ​ 21,846 Provision for Income Taxes ​ 6,568 ​ 4,101 ​ ​ 2,247 Net Income ​ $ 49,818 ​ $ 27,127 ​ $ 19,599 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income per share: ​ ​ ​ Basic ​ $ 1.35 ​ $ 0.74 ​ $ 0.53 Diluted ​ $ 1.34 ​ $ 0.73 ​ $ 0.53 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average number of shares outstanding: ​ ​ ​ Basic ​ 36,812,000 ​ 36,741,000 ​ 36,725,000 Diluted ​ 37,066,000 ​ 37,005,000 ​ 36,867,000 ​ See accompanying notes to consolidated financial statements. ​ FS-6 Table of Contents NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Years ended June 30, 2024, 2023 and 2022 ​ ​ (in thousands except for share data) ​ ​ Common Stock ​ ​ ​ ​ Treasury Stock ​ ​ ​ ​ ​ ​ ​ Number of ​ ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ ​ Paid-in ​ Number of ​ ​ ​ ​ Retained ​ ​ ​ ​ ​ Issued ​ Amount ​ Capital ​ Shares ​ Amount ​ Earnings ​ Total Balance at June 30, 2021 ​ 39,595,883 ​ $ 396 ​ $ 18,201 ( 2,893,715 ) ​ $ ( 19,521 ) ​ $ 93,312 ​ $ 92,388 Stock options exercised ​ 32,314 ​ — ​ 155 — ​ — ​ — ​ ​ 155 Stock-based compensation expense ​ — ​ — ​ 1,649 — ​ — ​ — ​ ​ 1,649 Net income ​ — ​ ​ — ​ ​ — ​ — ​ ​ — ​ ​ 19,599 ​ ​ 19,599 Balances at June 30, 2022 ​ 39,628,197 ​ $ 396 ​ $ 20,005 ( 2,893,715 ) ​ $ ( 19,521 ) ​ $ 112,911 ​ $ 113,791 Stock options exercised 35,615 ​ ​ 1 ​ ​ 84 ​ — ​ ​ — ​ — ​ 85 Stock-based compensation expense — ​ — ​ 1,464 — ​ — ​ — ​ 1,464 Cash dividend ($ .0625 per share) ​ — ​ ​ — ​ ​ — ​ — ​ ​ — ​ ​ ( 2,298 ) ​ ​ ( 2,298 ) Net income — ​ — ​ — — ​ — ​ 27,127 ​ 27,127 Balances at June 30, 2023 39,663,812 ​ $ 397 ​ $ 21,553 ( 2,893,715 ) ​ $ ( 19,521 ) ​ $ 137,740 ​ $ 140,169 Stock options exercised ​ 104,374 ​ ​ 1 ​ ​ 426 ​ — ​ ​ — ​ ​ — ​ ​ 427 Stock-based compensation expense — ​ — ​ 1,733 — ​ — ​ — ​ 1,733 Cash dividend ($ .36 per share) ​ — ​ ​ — ​ ​ — ​ — ​ ​ — ​ ​ ( 13,258 ) ​ ​ ( 13,258 ) Net income — ​ — ​ — — ​ — ​ 49,818 ​ 49,818 Balances at June 30, 2024 39,768,186 ​ $ 398 ​ $ 23,712 ( 2,893,715 ) ​ $ ( 19,521 ) ​ $ 174,300 ​ $ 178,889 ​ See accompanying notes to consolidated financial statements. ​ FS-7 Table of Contents NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year ended June 30, ​ 2024 2023 2022 ​ ​ (in thousands) CASH FLOWS FROM OPERATING ACTIVITIES ​ ​ ​ ​ Net income ​ $ 49,818 ​ $ 27,127 ​ $ 19,599 Adjustments to reconcile net income to net cash provided by operating activities: ​ ​ ​ ​ Depreciation and amortization ​ 2,163 ​ 1,930 ​ 1,771 Gain on disposal of fixed asset ​ ​ — ​ ​ ( 15 ) ​ ​ — Interest expense (income) on other investments ​ ​ 31 ​ ​ ( 470 ) ​ ​ — Unrealized (gain) loss on marketable securities ​ ​ ( 56 ) ​ ​ 80 ​ ​ 426 (Recovery of) Provision for credit losses ​ ( 99 ) ​ ( 112 ) ​ 17 Change to inventory reserve ​ 1,691 ​ ( 445 ) ​ 1,187 Deferred income taxes ​ ( 2,776 ) ​ ( 2,818 ) ​ ( 214 ) Stock based compensation expense ​ 1,733 ​ 1,464 ​ 1,649 Gain on extinguishment of debt ​ ​ — ​ ​ — ​ ​ ( 3,904 ) Changes in operating assets and liabilities: ​ ​ ​ ​ ​ Accounts receivable ​ ( 5,730 ) ​ 3,261 ​ ( 1,154 ) Inventories ​ ( 3,255 ) ​ 1,883 ​ ( 19,274 ) Prepaid expenses and other current assets ​ ( 867 ) ​ ( 564 ) ​ ( 430 ) Income tax receivable ​ ​ 2 ​ ​ ( 75 ) ​ ​ — Other assets ​ 25 ​ 35 ​ ( 103 ) Accounts payable, accrued expenses, accrued salaries and wages, accrued income taxes ​ 2,688 ​ ( 6,581 ) ​ 8,762 Net Cash Provided by Operating Activities ​ 45,368 ​ 24,700 ​ 8,332 CASH FLOWS FROM INVESTING ACTIVITIES ​ ​ ​ Purchases of property, plant, and equipment ​ ( 1,594 ) ​ ( 2,962 ) ​ ( 1,482 ) Proceeds from disposal of fixed asset ​ ​ — ​ ​ 38 ​ ​ — Purchases of marketable securities ​ ​ ( 206 ) ​ ​ ( 148 ) ​ ​ ( 81 ) Purchases of other investments ​ ​ ( 1,351 ) ​ ​ ( 35,281 ) ​ ​ — Redemption of other investments ​ ​ — ​ ​ 10,091 ​ ​ — Net Cash Used in Investing Activities ​ ( 3,151 ) ​ ( 28,262 ) ​ ( 1,563 ) CASH FLOWS FROM FINANCING ACTIVITIES ​ ​ ​ Proceeds from stock option exercises ​ 427 ​ 85 ​ 155 Cash paid for dividend ​ ( 13,258 ) ​ ( 2,298 ) ​ — Net Cash (Used in) Provided by Financing Activities ​ ( 12,831 ) ​ ( 2,213 ) ​ 155 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net increase (decrease) in Cash and Cash Equivalents ​ 29,386 ​ ( 5,775 ) ​ 6,924 CASH AND CASH EQUIVALENTS - Beginning ​ 35,955 ​ 41,730 ​ 34,806 CASH AND CASH EQUIVALENTS - Ending ​ $ 65,341 ​ $ 35,955 ​ $ 41,730 SUPPLEMENTAL CASH FLOW INFORMATION ​ ​ ​ Interest paid ​ $ 14 ​ $ 16 ​ $ 16 Income taxes paid ​ $ 9,330 ​ $ 8,811 ​ $ 2,168 ​ See accompanying notes to consolidated financial statements. ​ FS-8 Table of Contents NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - Nature of Business and Summary of Significant Accounting Policies Nature of Business : Napco Security Technologies, Inc (“NAPCO”, “the Company”, “we”, “us”) is one of the leading manufacturers and designers of high-tech electronic security devices, cellular communication services for intrusion and fire alarm systems as well as a leading provider of school safety solutions. We offer a diversified array of security products, encompassing access control systems, door-locking products, intrusion and fire alarm systems and video surveillance products. These products are used for commercial, residential, institutional, industrial and governmental applications, and are sold worldwide principally to independent distributors, dealers and installers of security equipment. We have experienced significant growth in recent years, primarily driven by fast growing recurring service revenues generated from wireless communication services for intrusion and fire alarm systems, as well as our school security products that are designed to meet the increasing needs to enhance school security as a result of on-campus shooting and violence in the U.S. Significant Accounting Policies : Principles of Consolidation The consolidated financial statements include the accounts of Napco Security Technologies, Inc. and its wholly-owned subsidiaries. All inter-company balances and transactions have been eliminated in consolidation. Accounting Estimates The preparation of financial statements in conformity with Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent gains and losses at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We continuously evaluate our estimates and judgments based on historical experience, as well as other factors that we believe to be reasonable under the circumstances. The results of our evaluation form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Critical estimates include management’s judgments associated with reserves for sales returns and allowances, allowance for credit losses, overhead expenses applied to inventory, inventory reserves, valuation of intangible assets, share based compensation and income taxes. These estimates may change in the future if underlying assumptions or factors change, and actual results may differ from these estimates. Fair Value of Financial Instruments The carrying amounts of financial instruments, including cash equivalents, accounts receivable, accounts payable, and accrued expenses reflected in the consolidated financial statements approximate fair value due to their short-term maturities. The fair value of debt for footnote disclosure purposes, including current maturities, if any, is estimated using recently quoted market prices of the instrument, or if not available, a discounted cash flow analysis based on the estimated current incremental borrowing rates for similar types of instruments. Cash and Cash Equivalents All financial instruments purchased with an original maturity of three months or less at the time of purchase are considered cash equivalents. Such items may include liquid money market funds, certificate of deposit and time deposit accounts. Investments that are classified as cash equivalents are carried at cost, which approximates fair value. Certificate of deposits with an original maturity greater than three months are classified as Investments – other. The Company’s cash and cash equivalents included approximately $ 46,518,000 of short-term time deposits, consisting of a certificate of deposit totaling $ 5,402,000 and $ 41,116,000 in money market funds as of June 30, 2024. Cash and cash equivalents include approximately $ 15,242,000 of short-term time deposits, consisting of several certificates of deposit totaling $ 15,179,000 and $ 63,000 in a money market fund as of June 30, 2023. FS-9 Table of Contents Cash and cash equivalents consists of the following as of (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2024 June 30, 2023 ​ ​ ​ Cash ​ $ 18,823 ​ $ 20,713 Money Market Fund ​ 41,116 ​ 63 Certificate of Deposits ​ ​ 5,402 ​ ​ 15,179 ​ ​ $ 65,341 ​ $ 35,955 ​ Investments-other consists of the following as of (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2024 June 30, 2023 ​ ​ ​ Certificate of Deposits ​ $ 26,980 ​ $ 25,660 ​ ​ $ 26,980 ​ $ 25,660 ​ Certificate of deposits are recorded at the original cost plus accrued interest. The Company’s Certificate of Deposits consist of the following as of (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance Sheet Classification Interest Rate Maturity Date Cost Carrying Value Cash and Cash Equivalents ​ ​ 4.70 % ​ ​ 8/22/2024 ​ $ 5,374 ​ $ 5,402 Investments - other ​ ​ 4.55 % - 4.75 % ​ ​ 7/25/2024 - 10/24/2024 ​ ​ 26,709 ​ ​ 26,980 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance Sheet Classification Interest Rate Maturity Date Cost Carrying Value Cash and Cash Equivalents ​ ​ 4.59 % - 5.00 % ​ ​ 7/30/2023 - 8/29/2023 ​ $ 15,112 ​ $ 15,179 Investments - other ​ ​ 4.80 % - 5.15 % ​ ​ 7/24/2023 - 10/24/2023 ​ ​ 25,359 ​ ​ 25,660 ​ The Company has cash balances in banks in excess of the maximum amount insured by the FDIC and other international agencies as of June 30, 2024 and 2023. The Company has not historically experienced any credit losses with balances in excess of FDIC limits. Marketable Securities The Company’s marketable securities include investments in mutual funds, which invest primarily in various government and corporate obligations, stocks and money market funds . The Company’s marketable securities are reported at fair value with the related unrealized and realized gains and losses included in other income (expense). Realized gains or losses on mutual funds are determined on a specific identification basis. The Company evaluates its investments periodically for possible other-than-temporary impairment by reviewing factors such as the length of time and extent to which fair value had been below cost basis, the financial condition of the issuer and the Company’s ability and intent to hold the investment for a period of time, which may be sufficient for anticipated recovery of market value. The Company records an impairment charge to the extent that the cost of the available-for-sale securities exceeds the estimated fair value of the securities and the decline in value is determined to be other-than-temporary. During the years ended June 30, 2024 and 2023, the Company did not record an impairment charge regarding its investment in marketable securities because management believes, based on its evaluation of the circumstances, that the decline in fair value below the cost of certain of the Company’s marketable securities is temporary. FS-10 Table of Contents Accounts Receivable Accounts receivable is stated net of the reserves for credit losses of $ 32,000 and $ 131,000 as of June 30, 2024 and 2023, respectively. In accordance with ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326), the Company recognizes an allowance for credit losses for trade and other receivables to present the net amount expected to be collected as of the balance sheet date. Such allowance is based on the credit losses expected to arise over the life of the asset which includes consideration of past events and historical loss experience, current events and also future events based on our expectation as of the balance sheet date. Receivables are written off when the Company determined that such receivables are deemed uncollectible. The Company pools its receivables based on similar risk characteristics in estimating its expected credit losses. In situations where a receivable does not share the same risk characteristics with other receivables, the Company measures those receivables individually. The Company also continuously evaluates such pooling decisions and adjusts as needed from period to period as risk characteristics change. The Company utilizes the loss rate method in determining its lifetime expected credit losses on its receivables. This method is used for calculating an estimate of losses based primarily on the Company’s historical loss experience. In determining its loss rates, the Company evaluates information related to its historical losses, adjusted for current conditions and further adjusted for the period of time that can be reasonably forecasted. Qualitative and quantitative adjustments related to current conditions and the reasonable and supportable forecast period consider all the following: past due receivables, the customer creditworthiness, changes in the terms of receivables, effect of other external forces such as competition, and legal and regulatory requirements on the level of estimated credit losses in the existing receivables. Inventories Inventories are valued at the lower of cost or net realizable value, with cost being determined on the first-in, first-out (FIFO) method. The reported net value of inventory includes finished saleable products, work-in-process and raw materials that will be sold or used in future periods. Inventory costs include raw materials, direct labor and overhead. The Company’s overhead expenses are applied based, in part, upon estimates of the proportion of those expenses that are related to procuring and storing raw materials as compared to the manufacture and assembly of finished products. These proportions, the method of their application, and the resulting overhead included in ending inventory, are based in part on subjective estimates and actual results could differ from those estimates. The Company records a reserve for excess and slow-moving inventory, which represents any excess of the cost of the inventory over its estimated realizable value. This reserve is calculated using an estimated excess and slow-moving percentage applied to the inventory based on age, historical trends, product life cycle, requirements to support forecasted sales, and the ability to find alternate applications of its raw materials and to convert finished product into alternate versions of the same product to better match customer demand. In addition, and as necessary, the Company may establish specific reserves for future known or anticipated events. There is inherent professional judgment and subjectivity made by both production and engineering members of management in determining the estimated excess and slow-moving percentage (See Note 6). The Company also regularly reviews the period over which its inventories will be converted to sales. Any inventories expected to convert to sales beyond 12 months from the balance sheet date are classified as non-current. Property, Plant, and Equipment Property, plant, and equipment are carried at cost less accumulated depreciation. Expenditures for maintenance and repairs are charged to expense as incurred; costs of major renewals and improvements are capitalized. At the time property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are eliminated from the asset and accumulated depreciation accounts and the profit or loss on such disposition is reflected in income. Depreciation is recorded over the estimated service lives of the related assets using primarily the straight-line method. Amortization of leasehold improvements is calculated by using the straight-line method over the estimated useful life of the asset or lease term, whichever is shorter. FS-11 Table of Contents Long-Lived and Intangible Assets Long-lived assets are amortized over their useful lives and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets in question may not be recoverable. Impairment would be recorded in circumstances where undiscounted cash flows expected to be generated by an asset are less than the carrying value of that asset. Changes in intangible assets are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2024 ​ June 30, 2023 ​ Carrying Accumulated Net book Carrying Accumulated Net book ​ ​ value ​ amortization ​ value ​ value ​ amortization ​ value Customer relationships ​ $ 9,800 ​ $ ( 9,436 ) ​ $ 364 ​ $ 9,800 ​ $ ( 9,302 ) ​ $ 498 Trade name ​ ​ 4,048 ​ ( 810 ) ​ 3,238 ​ 4,048 ​ ( 607 ) ​ 3,441 ​ ​ $ 13,848 ​ $ ( 10,246 ) ​ $ 3,602 ​ $ 13,848 ​ $ ( 9,909 ) ​ $ 3,939 ​ Amortization expense for intangible assets subject to amortization was approximately $ 337,000 , $ 361,000 and $ 391,000 for the fiscal years ended June 30, 2024, 2023 and 2022, respectively. Amortization expense for each of the next five fiscal years is estimated to be as follows: 2025 - $ 315,000 ; 2026 - $ 297,000 ; 2027 - $ 283,000 ; 2028 - $ 269,000 ; and 2029 - $ 210,000 . The weighted average remaining amortization period for intangible assets was 14.8 years and 15.5 years at June 30, 2024 and 2023, respectively. Revenue Recognition Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. Equipment Revenue Equipment revenue, which includes shipping and handling costs, is primarily generated from the sale of finished products to customers. Those sales predominantly contain a single performance obligation and revenue is recognized at a single point in time when ownership, risks and rewards transfer, which is typically the date of shipment of the related equipment when the product is picked up by the carrier or customer. A provision for product returns, credits and rebates is recorded as a reduction of equipment revenue in the same period the revenue is recognized. The Company provides limited standard warranty for defective products, usually for a period of 24 to 36 months, and accepts returns for such defective products as well as for other limited circumstances. The Company also provides rebates to customers for meeting specified purchasing targets and other coupons or credits in limited circumstances. Reserves are established for the estimated returns, rebates and credits and such variable consideration is measured based on the expected value method. The Company analyzes product sales returns and is able to make reasonable and reliable estimates of product returns based on several factors including actual returns and expected return data communicated to the Company by its customers. Service Revenue Service revenue is primarily generated from the sale of monthly cellular communication services to customers. Those sales predominantly contain a single performance obligation and revenue is recognized ratably with the delivery of cellular communication service over the related monthly period, and when ownership, risks and rewards transfer to the customer. The services are billed monthly, and customers have the right to cancel the cellular communication services at any time, however the contract with the customer does not provide for a refund. FS-12 Table of Contents Cost of Sales Equipment Cost of Sales Equipment cost of sales is primarily comprised of direct materials and supplies consumed in the manufacturing of products, as well as manufacturing labor, depreciation expense and direct and indirect overhead expenses necessary to acquire and convert the purchased materials and supplies into finished products. Service Cost of Sales Service cost of sales includes the cost of operating our network operations center to manage and deliver telecommunication services. Shipping and Handling Sales and Costs The Company records the amount billed to customers for shipping and handling in net sales ($ 349,000 , $ 450,000 and $ 428,000 in the fiscal years ended June 30, 2024, 2023 and 2022, respectively) and classifies the costs associated with these sales in cost of sales ($ 1,573,000 , $ 1,697,000 and $ 1,425,000 in the fiscal years ended June 30, 2024, 2023 and 2022, respectively). Advertising and Promotional Costs Advertising and promotional costs are included in "Selling, General and Administrative" expenses in the consolidated statements of income and are expensed as incurred. Advertising expense for fiscal years ended June 30, 2024, 2023 and 2022 was $ 3,262,000 , $ 2,931,000 and $ 2,889,000 , respectively. Research and Development Costs Research and development costs incurred by the Company are charged to expense as incurred and are included in operating expenses in the consolidated statements of income. Company-sponsored research and development expense for the fiscal years ended June 30, 2024, 2023 and 2022 was $ 10,763,000 , $ 9,328,000 and $ 8,024,000 , respectively. Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company measures and recognizes the tax implications of positions taken or expected to be taken in its tax returns on an ongoing basis. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Net Income per Share Basic net income per common share (Basic EPS) is computed by dividing net income by the weighted average number of common shares outstanding. Diluted net income per common share (Diluted EPS) is computed by dividing net income by the weighted average number of common shares and dilutive common share equivalents and convertible securities then outstanding. FS-13 Table of Contents The following provides a reconciliation of information used in calculating the per share amounts for the fiscal years ended June 30 (in thousands, except per share data): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net Income per ​ ​ Net Income ​ Weighted Average Shares ​ Share ​ ​ 2024 2023 2022 2024 2023 2022 2024 2023 2022 Basic EPS ​ $ 49,818 ​ $ 27,127 ​ $ 19,599 ​ 36,812 ​ 36,741 ​ 36,725 ​ $ 1.35 ​ $ 0.74 ​ $ 0.53 Effect of Dilutive Securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stock Options ​ ​ — ​ — ​ — 254 264 142 ​ ( 0.01 ) ​ ( 0.01 ) ​ — Diluted EPS ​ $ 49,818 ​ $ 27,127 ​ $ 19,599 37,066 37,005 36,867 ​ $ 1.34 ​ $ 0.73 ​ $ 0.53 ​ Options to purchase 19,663 , 7,534 and 214,109 shares of common stock for the fiscal years ended June 30, 2024, 2023 and 2022, respectively, were not included in the computation of Diluted EPS because their inclusion would be anti-dilutive. These options were still outstanding at the end of the respective periods. Stock-Based Compensation The Company has established five share incentive programs as discussed in Note 10. Stock-based awards exchanged for services are accounted for under the fair value method. Accordingly, stock-based compensation cost is measured at the grant date based on the estimated fair value of the award. The expense for awards is recognized over the requisite service period (generally the vesting period of the award). The Company has elected to treat awards with only service conditions and with graded vesting as one award. Consequently, the total compensation expense is recognized straight-line over the entire vesting period, so long as the compensation cost recognized at any date at least equals the portion of the grant date fair value of the award that is vested at that date. Determining the fair value of share-based awards at the grant date requires assumptions and judgments about expected volatility, among other factors. Stock-based compensation costs of $ 1,733,000 , $ 1,464,000 and $ 1,649,000 were recognized for the fiscal years ended June 30, 2024, 2023 and 2022, respectively. Foreign Currency The Company has determined the functional currency of all foreign subsidiaries is the U.S. Dollar. All foreign operations are considered a direct and integral part or extension of the Company’s operations. The day-to-day operations of all foreign subsidiaries are dependent on the economic environment of the U.S. Dollar. Therefore, no realized and unrealized gains and losses associated with foreign currency translation are recorded for the fiscal years ended June 30, 2024, 2023 or 2022. Comprehensive Income For the fiscal years ended June 30, 2024, 2023 and 2022, the Company’s operations did not give rise to material items includable in comprehensive income, which were not already included in net income. Accordingly, the Company’s comprehensive income approximates its net income for all periods presented. Segment Reporting The Company operates and measures its results in one operating segment and therefore has one reportable segment: the development, manufacture and sales of high-tech security devices and related cellular communication services for the devices. The Company’s Chief Operating Decision Maker, (the President, Chief Operating Officer, and Chief Financial Officer) evaluates performance of the Company and makes decisions regarding the allocation of resources based on total Company results. The Company has presented required geographical data in Note 15. FS-14 Table of Contents Leases The Company determines at contract inception if an arrangement is a lease, or contains a lease, of an identified asset for which the Company has the right to obtain substantially all of the economic benefits from its use and the right to direct its use. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, while lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at lease commencement date based on the present value of lease payments over the lease term. The implicit discount rate in the Company’s leases generally cannot readily be determined, and therefore the Company uses its incremental borrowing rate based on information available at lease commencement date in determining the present value of future payments. If the Company has options to renew or terminate certain leases, those options are included in the determination of lease term when it is reasonably certain that the Company will exercise such options. The Company does not separate lease and non-lease components in determining ROU assets or lease liabilities for real estate leases. Additionally, the Company does not recognize ROU assets or lease liabilities for leases with original terms or renewals of one year or less. See Note 14 – Commitments and Contingencies; Leases for additional accounting policies and disclosures. Legal and Other Contingencies The outcomes of legal proceedings and claims brought against us are subject to significant uncertainty. An estimated loss from a loss contingency such as a legal proceeding or claim is accrued by a charge to income if it is probable that an asset has been impaired, or a liability has been incurred and the amount of the loss can be reasonably estimated. In determining whether a loss should be accrued we evaluate, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss. Changes in these factors could materially impact our consolidated financial statements. Recently Adopted Accounting Standards Reference Rate Reform (ASC Topic 848) In March 2020, the FASB issued authoritative guidance to provide optional relief for companies preparing for the discontinuation of interest rates such as the London Interbank Offered Rate (“LIBOR”), which is expected to be phased out for new arrangements at the end of calendar 2021, and applies to lease contracts, hedging instruments, held-to-maturity debt securities and debt arrangements that have LIBOR as the benchmark rate. On February 9, 2024, the Company’s bank has shifted to the Benchmark Replacement as defined in the Fourth Amended and Restated Credit Agreement (“Amended Agreement”) with the bank. The new benchmark rate is the Secured Overnight Financing Rate (SOFR) (see Note 9). The adoption of the standard and the transition did not have a material impact on the condensed consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The update improves the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer. The guidance requires that an acquiring entity in a business combination recognize and measure contract assets and contract liabilities acquired in accordance with Topic 606 as if it had originated the contract. The amendments in this update were adopted at the beginning of fiscal 2024 and will be applied prospectively to applicable business combinations. The Company determined that adoption of this update has not had a material impact on the Company's consolidated financial statements. Recent Accounting Pronouncements Not Yet Adopted In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures . The update expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. It further requires disclosure of the amount and description of its composition for other segment items, and interim disclosures of both a reportable segment’s profit or loss and assets. The guidance requires disclosure of the title and position of the chief operating decision maker and how reported measures of segment profit or loss are used to assess performance and allocate resources. This pronouncement is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning FS-15 Table of Contents after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the impact of adoption on its consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which requires public entities to disclose consistent categories and greater disaggregation of information in the rate reconciliation and for income taxes paid. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The guidance is effective for financial statements issued for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the impact of adoption on its consolidated financial statements. The Company is evaluating other pronouncements recently issued but not yet adopted. The adoption of these pronouncements is not expected to have a material impact on our consolidated financial statements. NOTE 2 – Revenue Recognition and Contracts with Customers The Company is engaged in one major line of business: the development, manufacture, and distribution of security products, encompassing access control systems, door security products, intrusion and fire alarm systems, alarm communication services, and video surveillance products for commercial and residential use. The Company also provides wireless communication service for intrusion and fire alarm systems on a monthly basis. These products are used for commercial, residential, institutional, industrial and governmental applications, and are sold worldwide principally to independent distributors, dealers and installers of security equipment. Sales to unaffiliated customers are primarily shipped from the United States. As of June 30, 2024 and 2023, the Company included refund liabilities of approximately $ 6,295,000 and $ 5,521,000 , respectively, in accrued expenses within the Consolidated Balance Sheets. As of June 30, 2024 and 2023, the Company included return-related assets of approximately $ 1,586,000 and $ 1,338,000 , respectively, in other current assets. As a percentage of gross sales, sales returns, rebates and allowances were 7 %, 7 % and 10 % for the fiscal years ended June 30, 2024, 2023 and 2022, respectively. The Company disaggregates revenue from contracts with customers into major product lines. The Company determines that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. As noted in the accounting policy footnote, the Company’s business consists of one operating segment. Following is the disaggregation of revenues based on major product lines (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year ended June 30, ​ ​ 2024 2023 2022 Major Product Lines: ​ ​ ​ ​ Intrusion and access alarm products ​ $ 39,372 ​ $ 47,344 ​ $ 49,606 Door locking devices ​ 73,699 ​ 62,718 ​ 48,006 Services ​ 75,749 ​ 59,935 ​ 45,981 Total Revenues ​ $ 188,820 ​ $ 169,997 ​ $ 143,593 The following table represents the allowance for credit losses accounts as of the respective years ending June 30 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of period Charged to costs and expenses Deductions/ (recoveries) Balance at end of period For the Year Ended June 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses ​ $ 226 ​ $ 17 ​ $ — ​ $ 243 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended June 30, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses ​ $ 243 ​ $ 6 ​ $ ( 118 ) ​ $ 131 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended June 30, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses ​ $ 131 ​ $ — ​ $ ( 99 ) ​ $ 32 ​ ​ FS-16 Table of Contents NOTE 3 – Business and Credit Concentrations An entity is more vulnerable to concentrations of credit risk if it is exposed to risk of loss greater than it would have had if it mitigated its risk through diversification of customers. The Company had one customer with an accounts receivable balance that comprised 17 %, 19 % and 22 % of the Company’s accounts receivable at June 30, 2024, 2023 and 2022, respectively. Sales to this customer did not exceed 10% of net sales during fiscal years ended June 30, 2024, 2023 and 2022. The Company had another customer with an accounts receivable balance that comprised 12 % and 14 % of the Company’s accounts receivable at June 30, 2024 and 2023, respectively. The customer accounts receivable balance did not exceed 10% at June 30, 2022. Sales to this customer did not exceed 10% of net sales in any of the fiscal years ended June 30, 2024, 2023 and 2022, respectively. The Company had a third customer with an accounts receivable balance that comprised 16 % of the Company’s accounts receivable at June 30, 2022. The customer accounts receivable balance did not exceed 10% at June 30, 2024 or 2023. Sales to this customer did not exceed 10% of net sales in any of the fiscal years ended June 30, 2024, 2023 and 2022. NOTE 4 – Fair Value Measurements Fair value is the price that would be received for an asset or the amount paid to transfer a liability in an orderly transaction between market participants. The Company is required to classify certain assets and liabilities based on the following fair value hierarchy: ● Level 1: Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; ● Level 2: Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; and ● Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company has evaluated the estimated fair value of financial instruments using available market information and valuations as provided by third-party sources. The use of different market assumptions or estimation methodologies could have a significant effect on the estimated fair value amounts. FS-17 Table of Contents The following table presents the Company’s assets that were measured at fair value on a recurring basis at June 30, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Level 1 ​ Level 2 ​ Level 3 ​ Total June 30, 2024 ​ ​ ​ ​ ​ ​ ​ Cash equivalents ​ ​ ​ ​ ​ ​ ​ Certificate of deposits 5,402,000 ​ - ​ - ​ 5,402,000 Money market funds 41,116,000 ​ - ​ - ​ 41,116,000 Total 46,518,000 ​ - ​ - ​ 46,518,000 Short-term investments ​ ​ ​ ​ ​ ​ ​ Certificate of deposits 26,980,000 ​ - ​ - ​ 26,980,000 Total 26,980,000 ​ - ​ - ​ 26,980,000 Marketable securities ​ ​ ​ ​ ​ ​ ​ Mutual funds 5,398,000 ​ - ​ - ​ 5,398,000 Total 5,398,000 ​ - ​ - ​ 5,398,000 ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 ​ ​ ​ ​ ​ ​ ​ Cash equivalents ​ ​ ​ ​ ​ ​ ​ Certificate of deposits 15,179,000 ​ - ​ - ​ 15,179,000 Money market funds 63,000 ​ - ​ - ​ 63,000 Total 15,242,000 ​ - ​ - ​ 15,242,000 Short-term investments ​ ​ ​ ​ ​ ​ ​ Certificate of deposits 25,660,000 ​ - ​ - ​ 25,660,000 Total 25,660,000 ​ - ​ - ​ 25,660,000 Marketable securities ​ ​ ​ ​ ​ ​ ​ Mutual funds 5,136,000 ​ - ​ - ​ 5,136,000 Total 5,136,000 ​ - ​ - ​ 5,136,000 ​ The Company’s investments classified as Level 1 are based on quoted prices that are available in active markets, as well as certificates of deposits and time deposits that are classified as Level 1 due to their short-term nature. The Company’s investments classified as Level 2 are valued using observable inputs to quoted market prices, benchmark yields, reported trades, broker/dealer quotes, or alternative pricing sources with reasonable levels of price transparency. For the years ended June 30, 2024 and 2023, there were no transfers between Levels 1 and 2 investments and no transfers in or out of Level 3. NOTE 5 – Marketable Securities Marketable securities include investments in fixed income mutual funds, which are reported at their fair values. The disaggregated net gains and losses on the marketable securities recognize in the income statement for the years ended June 30, 2024, 2023 and 2022 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended June 30, ​ 2024 2023 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net gains recognized during the period on marketable securities ​ $ 207 ​ $ 147 ​ $ 81 Less: Net gains recognized during the period on marketable securities sold during the period ​ — ​ — ​ — Unrealized gains (losses) recognized during the reporting period on marketable securities still held at the reporting date ​ 55 ​ ( 79 ) ​ ( 426 ) ​ ​ $ 262 ​ $ 68 ​ $ ( 345 ) FS-18 Table of Contents The following tables summarize the Company’s marketable securities (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2024 ​ June 30, 2023 ​ ​ ​ ​ ​ ​ ​ Unrealized ​ ​ ​ ​ ​ ​ ​ Unrealized ​ Cost Fair Value Gain (Loss) Cost Fair Value Gain (Loss) Mutual Funds $ 5,857 ​ ​ 5,398 ​ $ ( 459 ) ​ $ 5,651 ​ $ 5,136 ​ $ ( 515 ) ​ Investment income is recognized when earned and consists principally of interest income from fixed income mutual funds. Realized gains and losses on sales of investments are determined on a specific identification basis. Available-for-sale securities in a loss position at June 30, 2024 and 2023 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Continuous Loss Position for Less than 12 Months ​ Continuous Loss Position for 12 Months or More ​ Estimated Fair Value ​ Gross Unrealized Losses ​ Estimated Fair Value ​ Gross Unrealized Losses June 30, 2024 ​ ​ ​ ​ ​ ​ ​ Mutual funds - ​ - ​ 4,677,000 ​ 486,000 Total - ​ - ​ 4,677,000 ​ 486,000 ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 ​ ​ ​ ​ ​ ​ ​ Mutual funds - ​ - ​ 4,457,000 ​ 537,000 Total - ​ - ​ 4,457,000 ​ 537,000 ​ NOTE 6 - Inventories Inventories, net of reserves are valued at lower of cost (first-in, first-out method) or net realizable value. Inventories, net of reserves consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, June 30, ​ ​ 2024 ​ 2023 Component parts ​ $ 32,283 ​ $ 29,939 Work-in-process ​ 7,509 ​ 7,726 Finished product ​ 10,121 ​ 10,684 ​ ​ $ 49,913 ​ $ 48,349 ​ ​ ​ ​ ​ ​ ​ Classification of inventories: ​ ​ Current ​ $ 34,804 ​ $ 35,062 Non-current ​ 15,109 ​ 13,287 ​ ​ $ 49,913 ​ $ 48,349 ​ The reserve for excess and slow-moving inventory, which reduces inventory in our consolidated balance sheets were $ 5,026,000 and $ 3,367,000 as of June 30, 2024 and 2023, respectively. ​ FS-19 Table of Contents NOTE 7 - Property, Plant, and Equipment Property, plant and equipment consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 ​ Useful Life in Years ​ ​ ​ ​ ​ ​ ​ ​ Land ​ $ 904 ​ $ 904 ​ N/A Buildings ​ 8,911 ​ 8,911 30 to 40 Molds and dies ​ 7,539 ​ 7,517 3 to 5 Furniture and fixtures ​ 3,613 ​ 3,387 5 to 10 Machinery and equipment ​ 29,761 ​ 28,574 3 to 10 Building improvements ​ 3,129 ​ 3,078 Shorter of the lease term or life of asset ​ ​ 53,857 ​ 52,371 Less: accumulated depreciation and amortization ​ ( 44,780 ) ​ ( 43,063 ) ​ ​ $ 9,077 ​ $ 9,308 ​ Depreciation and amortization expense on property, plant, and equipment was approximately $ 1,826,000 , $ 1,569,000 and $ 1,380,000 in fiscal 2024, 2023 and 2022, respectively. NOTE 8 - Income Taxes The provision for income taxes represents Federal, foreign, and state and local income taxes. The effective rate differs from statutory rates due to the effect of state and local income taxes, tax rates in foreign jurisdictions, global intangible low-taxed income (“GILTI”), tax benefit of R&D credits, and certain nondeductible expenses. Our effective tax rate will change based on recurring and non-recurring factors including, but not limited to, the geographical mix of earnings, enacted tax legislation, and state and local income taxes. The amounts of income before income taxes attributable to domestic and foreign operations were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year ended June 30, ​ 2024 2023 2022 ​ ​ ​ ​ Domestic ​ $ 6,936 ​ $ 4,926 ​ $ 6,461 Foreign ​ 49,450 ​ 26,302 ​ 15,385 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ​ $ 56,386 ​ $ 31,228 ​ $ 21,846 ​ FS-20 Table of Contents The provision for income taxes is comprised of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year ended June 30, ​ 2024 2023 2022 Current income taxes: ​ ​ ​ Federal ​ $ 8,329 ​ $ 5,899 ​ $ 2,161 State ​ 1,015 ​ 1,020 ​ 300 ​ ​ 9,344 ​ 6,919 ​ 2,461 Deferred income taxes: ​ ​ ​ ​ ​ ​ ​ Federal ​ ​ ( 2,367 ) ​ ​ ( 2,334 ) ​ ( 214 ) State ​ ​ ( 409 ) ​ ​ ( 484 ) ​ ​ — ​ ​ ​ ( 2,776 ) ​ ( 2,818 ) ​ ( 214 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Provision for income taxes ​ $ 6,568 ​ $ 4,101 ​ $ 2,247 ​ A reconciliation of the U.S. Federal statutory income tax rate to our actual effective tax rate on earnings before income taxes is as follows for the years ended June 30, (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ ​ 2023 ​ 2022 ​ ​ ​ ​ ​ % of ​ ​ ​ ​ ​ % of ​ ​ ​ ​ ​ % of ​ ​ ​ ​ ​ ​ Pre-tax ​ ​ ​ ​ ​ Pre-tax ​ ​ ​ ​ ​ Pre-tax ​ ​ Amount Income ​ Amount Income ​ Amount Income Tax at Federal statutory rate ​ $ 11,841 ​ 21.0 % ​ $ 6,558 ​ 21.0 % ​ $ 4,588 ​ 21.0 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Increases (decreases) in taxes resulting from: ​ ​ ​ ​ ​ ​ ​ Meals and entertainment ​ 66 0.1 % ​ ​ 48 0.2 % ​ ​ 29 0.1 % State income taxes, net of Federal income tax benefit ​ 935 1.7 % ​ ​ 436 1.4 % ​ ​ 238 1.1 % Global intangible low-taxed income ​ ​ 5,259 ​ 9.3 % ​ ​ 2,739 ​ 8.8 % ​ ​ 1,697 ​ 7.8 % R&D Credit ​ ( 632 ) ( 1.1 ) % ​ ​ ( 661 ) ( 2.1 ) % ​ ​ ( 554 ) ( 2.5 ) % Executive Compensation ​ 47 0.1 % ​ ​ — — % ​ ​ — — % Foreign Source income not subject to Tax ​ ​ ( 10,518 ) ​ ( 18.7 ) % ​ ​ ( 5,524 ) ​ ( 17.7 ) % ​ ​ ( 3,231 ) ​ ( 14.8 ) % Non-taxable debt extinguishment ​ — — % ​ ​ — — % ​ ​ ( 820 ) ( 3.8 ) % Uncertain Tax Positions ​ 78 0.1 % ​ ​ 63 0.2 % ​ ​ 20 0.1 % Other, net ​ ( 508 ) ( 0.9 ) % ​ ​ 442 1.4 % ​ ​ 280 1.3 % Effective tax rate ​ $ 6,568 11.6 % ​ $ 4,101 13.1 % ​ $ 2,247 10.3 % ​ FS-21 Table of Contents Deferred tax assets and deferred tax liabilities at June 30, 2024 and 2023 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred Tax Assets (Liabilities) ​ 2024 2023 Accounts receivable ​ $ 8 ​ $ 22 Inventories ​ 541 ​ 397 Accrued liabilities ​ 676 ​ 857 Stock based compensation expense ​ 452 ​ 250 Revenue reserves ​ ​ 439 ​ ​ 333 Unrealized loss on marketable securities ​ ​ 136 ​ ​ 124 Capitalized research and development cost ​ ​ 5,447 ​ ​ 2,923 Other ​ ​ 2 ​ ​ 4 Total Deferred Tax Assets ​ $ 7,701 ​ $ 4,910 Valuation allowance ​ — ​ — Deferred income tax assets, net of valuation allowance ​ $ 7,701 ​ $ 4,910 ​ ​ ​ ​ ​ ​ ​ Intangibles ​ ( 874 ) ​ ( 916 ) Property, plant and equipment ​ ( 786 ) ​ ( 729 ) Other deferred tax liabilities ​ ( 613 ) ​ ( 613 ) Total Deferred Tax Liability ​ $ ( 2,273 ) ​ $ ( 2,258 ) ​ ​ ​ ​ ​ ​ ​ Net Deferred Tax Asset ​ $ 5,428 ​ $ 2,652 ​ The Company has identified the United States and New York State as its major tax jurisdictions. Fiscal years 2021 and forward are still open for examination, in addition to fiscal year 2018, which is subject to a six year statute of limitations. In addition, the Company has a wholly-owned subsidiary which operates in a Free Zone in the Dominican Republic (“DR”) and is exempt from DR income tax. The provision for income taxes represents Federal, foreign, and state and local income taxes. The effective rate differs from statutory rates due to the effect of tax rates in foreign jurisdictions, state and local income taxes, tax benefit of R&D credits, certain nondeductible expenses, uncertain tax positions and global intangible low-taxed income ("GILTI"). During the year ending June 30, 2024, the Company did no t increase or decrease its reserve for uncertain income tax positions. The Company’s practice is to recognize interest and penalties related to income tax matters in income tax expense and accrued income taxes. As of June 30, 2024, the Company had accrued interest totaling $ 217,000 , penalties totaling $ 5,000 , and $ 700,000 of unrecognized net tax benefits that, if recognized, would favorably affect the Company’s effective income tax rate in any future period. The Company does not expect that its unrecognized tax benefits will significantly change within the next twelve months. The Company claims R&D tax credits on eligible research and development expenditures. The R&D tax credits are recognized as a reduction to income tax expense. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 2022 Balance of gross unrecognized tax benefits as of Beginning of Year ​ $ 700 ​ $ 678 ​ $ 678 Increase to unrecognized tax benefits resulting from a state filing tax position ​ — ​ 22 ​ — Balance of gross unrecognized tax benefits as of End of Year ​ $ 700 ​ $ 700 ​ $ 678 ​ ​ NOTE 9 - Debt On February 9, 2024, the Company and its primary bank, HSBC Bank USA National Association (“HSBC”), agreed to amend and restate the existing Third Amended and Restated Credit Agreement (“Agreement”) dated June 29, 2012, as amended, between the Registrant and HSBC with the Fourth Amended and Restated Credit Agreement (“Amended Agreement”). The Amended Agreement extends the term of the Agreement from June 28, 2024, to February 9, 2029. The Amended Agreement also increases the available FS-22 Table of Contents revolving credit line from $ 11,000,000 to $ 20,000,000 and replaces the LIBOR benchmark rate with the Secured Overnight Financing Rate (SOFR) benchmark rate. As of June 30, 2024 and 2023, the Company has no outstanding debt. The Amended Agreement provides for a SOFR-based interest rate option of SOFR plus 1.2645 % to 1.3645 % , depending on the Fixed Charge Coverage Ratio, which is to be measured and adjusted quarterly, a prime rate-based interest rate option of the prime rate, as defined in the Amended Agreement, and other terms and conditions as more fully described in the Amended Agreement. The Company’s obligations under the Amended Agreement continue to be secured by substantially all its domestic assets, including but not limited to, deposit accounts, accounts receivable, inventory, equipment and fixtures and intangible assets. In addition, the Company’s wholly owned subsidiaries, except for the Company’s foreign subsidiaries, have issued guarantees and pledges of all their assets to secure the Company’s obligations under the Amended Agreement. All the outstanding common stock of the Company’s domestic subsidiaries and 65% of the common stock of the Company’s foreign subsidiaries have been pledged to secure the Company’s obligations under the Amended Agreement. The Amended Agreement contains various restrictions and covenants including, but not limited to, compliance with certain financial rations, restrictions on payment of dividends and restrictions on borrowings. During the fourth quarter of fiscal 2020, the Company received the proceeds of promissory notes dated between April 17, 2020 and May 7, 2020 (the "PPP Loan Agreement"), entered into between the Company and HSBC Bank USA N.A., as lender (the "Lender”). The Lender made the loans pursuant to the Paycheck Protection Program (the "PPP"), created by Section 1102 of the CARES Act and governed by the CARES Act, Section 7(a)(36) of the Small Business Act, any rules or guidance that has been issued by the Small Business Association (“SBA”) implementing the PPP and acting as guarantor, or any other applicable loan program requirements, as defined in 13 CFR § 120.10, as amended from time to time. Pursuant to the PPP Loan Agreement, the Lender made loans to the Company with an aggregate principal amount of $ 3,904,000 (the "PPP Loan"). The PPP Loan and related extinguishment was accounted for in accordance with ASC 470 “Debt”. Pursuant to the CARES Act, the loans may be forgiven by the SBA. During the year ended June 30, 2022, the PPP Loans were forgiven, in their entirety, in accordance with guidelines set forth in the PPP loan documents. The Company recognized a gain on the extinguishment of debt during the fiscal year ended June 30, 2022 in the amount of $ 3,904,000 within the other (expense) income section in the accompanying condensed consolidated statements of income. The SBA reserves the right to audit PPP forgiveness applications for a period of six years from the date of forgiveness. It has indicated that it will audit all of those that are in excess of $2 million. NOTE 10 - Stock Options The Company follows ASC 718 (“Share-Based Payment”), which requires that all share-based payments to employees, including stock options, be recognized as compensation expense in the consolidated financial statements based on their fair values and over the requisite service period. For the fiscal years ended June 30, 2024, 2023 and 2022, the Company recorded non-cash compensation expense of $ 1,733,000 ($ .05 per basic and diluted share), $ 1,464,000 ($ .04 per basic and diluted share) and $ 1,649,000 ($ .04 per basic and diluted share), respectively, relating to stock-based compensation which are included in SG&A in the consolidated statements of income. 2012 Employee Stock Option Plan In December 2012, the stockholders approved the 2012 Employee Stock Option Plan (the “2012 Employee Plan”). The 2012 Employee Plan authorizes the granting of awards, the exercise of which would allow up to an aggregate of 1,900,000 shares of the Company’s common stock to be acquired by the holders of such awards. Under this plan, the Company may grant stock options, which are intended to qualify as incentive stock options (ISOs), to valued employees. Any plan participant who is granted ISOs and possesses more than 10 % of the voting rights of the Company’s outstanding common stock must be granted an option with a price of at least 110 % of the fair market value on the date of grant. Under the 2012 Employee Plan, stock options may be granted to valued employees with a term of up to 10 years at an exercise price equal to or greater than the fair market value on the date of grant and are exercisable, in whole or in part, at 20 % per year beginning on the date of grant. An option granted under this plan shall vest in full upon a “change in control” as defined in the plan. At June 30, 2024, 363,036 stock options were outstanding, 190,960 stock options were exercisable and no further stock options were available for grant under this plan. No options were granted under this plan during the year ended June 30, 2024. FS-23 Table of Contents The fair value of each option granted was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 ​ 2022 Risk-free interest rates ​ n/a ​ 3.03 % 1.64 % Expected lives ​ n/a ​ 7.27 Years ​ 6.18 Years ​ Expected volatility ​ n/a ​ 43 % 43 % Expected dividend yields ​ n/a ​ 0 % 0 % ​ The Company uses a weighted-average expected stock-price volatility assumption that is a combination of both current and historical implied volatilities of the underlying stock. The implied volatilities were obtained from publicly available data sources. For the weighted-average expected option life assumption, the Company considers the exercise behavior of past grants. The average risk-free interest rate is based on the U.S. Treasury Bond rate for the expected term of the options and the average dividend yield is based on historical experience. The following table reflects activity under the 2012 Plan for the fiscal years ended June 30,: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ ​ ​ Weighted average ​ ​ ​ ​ Weighted average ​ ​ ​ ​ Weighted average ​ Options exercise price Options exercise price Options exercise price Outstanding, beginning of year ​ ​ 521,580 ​ $ 19.37 ​ ​ 523,080 ​ $ 18.59 ​ ​ 214,080 ​ $ 9.59 Granted ​ ​ — ​ ​ — ​ ​ 37,500 ​ $ 26.94 ​ ​ 338,000 ​ $ 23.17 Forfeited/Lapsed ​ ​ ( 11,000 ) ​ $ 3.16 ​ ​ — ​ ​ — ​ ​ — ​ ​ - Exercised ​ ​ ( 147,544 ) $ 15.43 ​ ( 39,000 ) $ 10.44 ​ ( 29,000 ) $ 5.45 Outstanding, end of period ​ ​ 363,036 ​ $ 21.47 ​ 521,580 ​ $ 19.37 ​ 523,080 ​ $ 18.59 Exercisable, end of period ​ ​ 190,960 ​ $ 20.87 ​ 247,628 ​ $ 17.16 ​ 176,752 ​ $ 14.68 Weighted average fair value at grant date of options granted ​ ​ n/a ​ ​ ​ $ 13.36 ​ ​ ​ $ 12.16 ​ ​ Total intrinsic value of options exercised ​ $ 3,972,000 ​ ​ ​ ​ $ 822,000 ​ ​ ​ $ 502,000 ​ ​ Total intrinsic value of options outstanding ​ $ 11,067,000 ​ ​ ​ ​ $ 7,968,000 ​ ​ ​ $ 1,916,000 ​ ​ Total intrinsic value of options exercisable ​ $ 5,936,000 ​ ​ ​ ​ $ 4,330,000 ​ ​ ​ $ 1,218,000 ​ ​ ​ 0, 37,500 and 338,000 options were granted during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. 147,544 , 39,000 and 29,000 options were exercised during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. 109,544 of the 147,544 stock options exercised during the fiscal year ended June 30, 2024 were settled by the Company withholding 46,570 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. 29,600 of the 39,000 stock options exercised during the fiscal year ended June 30, 2023, were settled by the Company withholding 10,150 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. 1,000 of the 29,000 stock options exercised during the fiscal year ended June 30, 2022, were settled by the Company withholding 153 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. $ 427,000 , $ 84,000 and $ 155,000 was received from the remaining option exercises for the fiscal years ended June 30, 2024, 2023 and 2022, respectively, and the actual tax benefit realized for the tax deductions from option exercises was $ 119,000 , $ 0 and $ 0 for the years ended June 30, 2024, 2023 and 2022, respectively. FS-24 Table of Contents The following table summarizes information about stock options outstanding under the 2012 Employee Plan at June 30, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options outstanding ​ Options exercisable ​ ​ Weighted average ​ ​ ​ ​ ​ ​ ​ Number ​ remaining ​ Weighted average ​ Number ​ Weighted average Range of exercise prices ​ outstanding ​ contractual life ​ exercise price ​ exercisable ​ exercise price $ 10.02 ‑ $ 26.94 ​ 363,036 ​ 7.16 ​ $ 21.47 ​ 190,960 ​ $ 20.87 ​ ​ 363,036 ​ 7.16 ​ $ 21.47 ​ 190,960 ​ $ 20.87 ​ As of June 30, 2024 and 2023, there was $ 1,094,000 and 1,971,000 of unearned stock-based compensation cost related to share-based compensation arrangements granted under the 2012 Employee Plan, respectively. 101,876 , 109,876 and 107,576 options vested during the years June 30, 2024, 2023 and 2022, respectively. The total grant date fair value of the options vesting during the fiscal years ended June 30, 2024, 2023 and 2022 under this plan was $ 946,000 , $ 981,000 and $ 1,040,000 , respectively. 2012 Non-Employee Stock Option Plan In December 2012, the stockholders approved the 2012 Non-Employee Stock Option Plan (the “2012 Non-Employee Plan”). This plan authorizes the granting of awards, the exercise of which would allow up to an aggregate of 100,000 shares of the Company’s common stock to be acquired by the holders of such awards. Under this plan, the Company may grant stock options to non-employee directors and consultants to the Company and its subsidiaries. Under the 2012 Non-Employee Plan, stock options may be granted with a term of up to 10 years at an exercise price equal to or greater than the fair market value on the date of grant and are exercisable in whole or in part at 20 % per year beginning on the date of grant. An option granted under this plan shall vest in full upon a “change in control” as defined in the plan. At June 30, 2024, 20,400 stock options were outstanding, 16,560 stock options were exercisable and 0 stock options were available for grant under this plan. No stock options were granted under this plan during the year ended June 30, 2024. The fair value of each option granted was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 2022 Risk-free interest rates n/a ​ n/a ​ 1.68 % Expected lives n/a ​ n/a ​ 6.18 Years ​ Expected volatility n/a ​ n/a ​ 43 % Expected dividend yields n/a ​ n/a ​ 0 % ​ The following table reflects activity under the 2012 Non-Employee Plan for the fiscal years ended June 30,: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ Weighted average ​ ​ Weighted average ​ ​ Weighted average ​ ​ Options ​ exercise price ​ Options ​ exercise price ​ Options ​ exercise price Outstanding, beginning of year ​ ​ 20,400 ​ $ 14.39 ​ ​ 20,400 ​ $ 14.39 ​ ​ 12,000 ​ $ 6.55 Granted ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 9,600 ​ $ 22.93 Forfeited/Lapsed ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Exercised ​ ​ — ​ ​ — ​ — ​ ​ — ​ ( 1,200 ) $ 4.35 Outstanding, end of period ​ ​ 20,400 ​ $ 14.39 ​ 20,400 ​ $ 14.39 ​ 20,400 ​ $ 14.39 Exercisable, end of period ​ ​ 16,560 ​ $ 12.41 ​ 13,920 ​ $ 10.99 ​ 11,280 ​ $ 8.92 Weighted average fair value at grant date of options granted ​ ​ n/a ​ ​ ​ ​ ​ n/a ​ ​ $ 12.58 ​ Total intrinsic value of options exercised ​ ​ n/a ​ ​ ​ ​ ​ n/a ​ ​ $ 19,000 ​ Total intrinsic value of options outstanding ​ $ 766,000 ​ ​ ​ ​ $ 413,000 ​ ​ $ 149,000 ​ Total intrinsic value of options exercisable ​ $ 655,000 ​ ​ ​ ​ $ 329,000 ​ ​ $ 136,000 ​ ​ FS-25 Table of Contents 0 , 0 and 9,600 options were granted during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. 0 , 0 and 1,200 options were exercised during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. 1,200 stock options exercised during the fiscal year ended June 30, 2022 were settled by the Company withholding 258 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. $ 0 was received from the remaining option exercises for each of the fiscal years ended June 30, 2024, 2023 and 2022, and the actual tax benefit realized for the tax deductions from option exercises was $ 0 , $ 0 and $ 4,000 in fiscal 2024, 2023 and 2022 respectively. The following table summarizes information about stock options outstanding under the 2012 Non-Employee Plan at June 30, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options outstanding ​ Options exercisable ​ ​ ​ ​ Weighted average ​ Weighted ​ ​ ​ Weighted ​ ​ Number ​ remaining ​ average exercise ​ Number ​ average exercise Range of exercise prices ​ outstanding contractual life ​ price exercisable ​ price $ 4.35 - $ 22.93 ​ 20,400 ​ 5.65 ​ $ 14.39 ​ 16,560 ​ $ 12.41 ​ ​ 20,400 ​ 5.65 ​ $ 14.39 ​ 16,560 ​ $ 12.41 ​ As of June 30, 2024 and 2023, there was $ 24,000 and $ 46,000 of unearned stock-based compensation cost related to share-based compensation arrangements granted under the 2012 Non-Employee Plan, respectively. 2,640 , 2,640 and 6,240 options vested during the years June 30, 2024, 2023 and 2022, respectively. The total grant date fair value of the options vesting during each of the fiscal years ended June 30, 2024, 2023 and 2022 under this plan was $ 24,000 , $ 24,000 and $ 39,000 , respectively. 2018 Non-Employee Stock Option Plan In December 2018, the stockholders approved the 2018 Non-Employee Stock Option Plan (the “2018 Non-Employee Plan”). This plan authorizes the granting of awards, the exercise of which would allow up to an aggregate of 100,000 shares of the Company's common stock to be acquired by the holders of such awards. Under this plan, the Company may grant stock options to non-employee directors and consultants to the Company and its subsidiaries. Under the 2018 Non-Employee Plan, stock options may be granted with a term of up to 10 years at an exercise price equal to or greater than the fair market value on the date of grant and are exercisable in whole or in part at 20 % per year beginning on the date of grant. An option granted under this plan shall vest in full upon a “change in control” as defined in the plan. At June 30, 2024, 68,900 stock options were outstanding, 59,500 stock options were exercisable and 0 stock options were available for grant under this plan. No stock options were granted under this plan during the year ended June 30, 2024. The fair value of each option granted was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 ​ 2022 Risk-free interest rates ​ n/a ​ n/a ​ 1.68 % Expected lives ​ n/a ​ n/a ​ 6.18 Years ​ Expected volatility ​ n/a ​ n/a ​ 43 % Expected dividend yields ​ n/a ​ n/a ​ 0 % ​ FS-26 Table of Contents The following table reflects activity under the 2018 Non-Employee plan for the fiscal year ended June 30,: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ Weighted average ​ ​ Weighted average ​ ​ Weighted average ​ ​ Options exercise price ​ Options exercise price ​ Options exercise price Outstanding, beginning of year ​ ​ 75,000 ​ $ 14.83 ​ ​ 89,000 ​ $ 14.91 ​ ​ 70,100 ​ $ 11.93 Granted ​ ​ — ​ — ​ — ​ — ​ 23,500 $ 22.93 Forfeited/Lapsed ​ ​ — ​ — ​ — ​ — ​ — ​ — Exercised ​ ​ ( 6,100 ) $ 18.15 ​ ( 14,000 ) $ 15.32 ​ ( 4,600 ) $ 10.43 Outstanding, end of period ​ ​ 68,900 ​ $ 14.54 ​ 75,000 ​ $ 14.83 ​ 89,000 ​ $ 14.91 Exercisable, end of period ​ ​ 59,500 ​ $ 13.21 ​ 50,720 ​ $ 12.87 ​ 45,040 ​ $ 12.98 Weighted average fair value at grant date of options granted ​ ​ n/a ​ ​ ​ ​ ​ n/a ​ ​ ​ ​ $ 12.58 ​ ​ ​ Total intrinsic value of options exercised ​ $ 141,000 ​ ​ ​ ​ $ 209,000 ​ ​ ​ ​ $ 58,000 ​ ​ ​ Total intrinsic value of options outstanding ​ $ 2,578,000 ​ ​ ​ ​ $ 1,486,000 ​ ​ ​ ​ $ 561,000 ​ ​ ​ Total intrinsic value of options exercisable ​ $ 2,305,000 ​ ​ ​ ​ $ 1,104,000 ​ ​ ​ ​ $ 354,000 ​ ​ ​ ​ 0 , 0 and 23,500 options were granted during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. 6,100 , 14,000 and 4,600 options were exercised during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. 6,100 stock options exercised during the fiscal year ended June 30, 2024 were settled by the Company withholding 2,700 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. 14,000 stock options exercised during the fiscal year ended June 30, 2023 were settled by the company withholding 7,235 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. 4,600 stock options exercised during the fiscal year ended June 30, 2022 were settled by the company withholding 2,075 from the shares issuable on exercise of the options. The withheld shares of Common stock had an aggregate fair market value on the date of exercise equal to the purchase price being paid. $ 0 was received from the remaining option exercises for each of the fiscal years ended June 30, 2024, 2023 and 2022, and the actual tax benefit realized for the tax deductions from option exercises was $ 30,000 , $ 44,000 and $ 12,000 in fiscal 2024, 2023 and 2022, respectively. The following table summarizes information about stock options outstanding under the 2018 Non- Employee Plan at June 30, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options outstanding ​ Options exercisable ​ ​ Weighted average Weighted ​ Weighted ​ ​ Number ​ remaining ​ average exercise ​ Number ​ average exercise Range of exercise prices ​ outstanding ​ contractual life ​ price ​ exercisable ​ price $ 8.10 - $ 22.93 ​ 68,900 5.71 ​ $ 14.54 59,500 ​ $ 13.21 ​ ​ 68,900 5.71 ​ $ 14.54 59,500 ​ $ 13.21 ​ As of June 30, 2024 and 2023, there was $ 59,000 and $ 135,000 of unearned stock-based compensation cost related to share-based compensation arrangements granted under the 2018 Non-Employee Plan, respectively. 14,880 , 19,680 and 19,680 options vested during the years June 30, 2024, 2023 and 2022, respectively. The total grant date fair value of the options vesting during the fiscal year ended June 30, 2024, 2023 and 2022 under this plan was $ 124,000 , $ 149,000 and $ 160,000 , respectively. 2020 Non-Employee Stock Option Plan In May 2020, the stockholders approved the 2020 Non-Employee Stock Option Plan (the “2020 Non-Employee Plan”). This plan authorizes the granting of awards, the exercise of which would allow up to an aggregate of 100,000 shares of the Company's common stock to be acquired by the holders of such awards. Under this plan, the Company may grant stock options to non-employee directors and consultants to the Company and its subsidiaries. FS-27 Table of Contents Under the 2020 Non-Employee Plan, stock options may be granted with a term of up to 10 years at an exercise price equal to or greater than the fair market value on the date of grant and are exercisable in whole or in part at 20 % per year beginning on the date of grant. An option granted under this plan shall vest in full upon a “change in control” as defined in the plan. At June 30, 2024, 56,900 stock options were outstanding, 30,140 stock options were exercisable and 43,100 stock options were available for grant under this plan. No options were granted under this plan during the year ended June 30, 2024. The fair value of each option granted was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 2022 Risk-free interest rates n/a ​ 3.03 - 3.40 % 1.68 % Expected lives n/a ​ 7.23 - 7.27 Years ​ 6.18 Years ​ Expected volatility n/a ​ 43 % 43 % Expected dividend yields n/a ​ 0 % 0 % ​ The following table reflects activity under the 2020 Non-Employee plan for the fiscal year ended June 30,: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ ​ ​ Weighted average ​ ​ ​ ​ Weighted average ​ ​ ​ ​ Weighted average ​ Options exercise price Options exercise price Options exercise price Outstanding, beginning of year ​ 56,900 $ 23.35 ​ ​ 26,900 $ 18.64 ​ ​ 10,000 $ 11.40 Granted ​ — ​ ​ — ​ ​ 30,000 ​ $ 27.57 ​ ​ 16,900 ​ $ 22.93 Forfeited/Lapsed ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Exercised ​ — ​ — ​ ​ — ​ — ​ ​ — ​ — Outstanding, end of period ​ 56,900 ​ $ 23.35 ​ ​ 56,900 ​ $ 23.35 ​ ​ 26,900 ​ $ 18.64 Exercisable, end of period ​ 30,140 ​ $ 21.72 ​ ​ 18,760 ​ $ 20.73 ​ ​ 7,380 ​ $ 16.68 Weighted average fair value at grant date of options granted ​ ​ n/a ​ ​ $ 13.74 ​ ​ ​ $ 12.58 ​ ​ Total intrinsic value of options exercised ​ n/a ​ ​ n/a ​ ​ ​ n/a ​ ​ Total intrinsic value of options outstanding ​ $ 1,627,000 ​ ​ $ 643,000 ​ ​ ​ $ 92,000 ​ ​ Total intrinsic value of options exercisable ​ $ 911,000 ​ ​ $ 261,000 ​ ​ ​ $ 37,000 ​ ​ ​ 0 , 30,000 and 16,900 options were granted during the fiscal years ended June 30, 2024, 2023 and 2022, respectively. No options were exercised during the fiscal years ended June 30, 2024, 2023 and 2022. The following table summarizes information about stock options outstanding under the 2020 Non- Employee Plan at June 30, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options outstanding ​ Options exercisable ​ ​ ​ ​ Weighted average ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number ​ remaining ​ Weighted average ​ Number ​ Weighted average Range of exercise prices outstanding contractual life exercise price exercisable exercise price $ 11.40 - $ 30.71 56,900 7.59 ​ $ 23.35 30,140 ​ $ 21.72 ​ 56,900 7.59 ​ $ 23.35 30,140 ​ $ 21.72 ​ As of June 30, 2024 and 2023, there was $ 215,000 and $ 344,000 of unearned stock-based compensation cost related to share-based compensation arrangements granted under the 2020 Non-Employee Plan, respectively. 11,380 , 11,380 and 5,380 options vested during the years June 30, 2024, 2023 and 2022, respectively. The total grant date fair value of the options vesting during the fiscal year ended June 30, 2024, 2023 and 2022 under this plan was $ 129,000 , $ 129,000 and $ 55,000 , respectively. 2022 Employee Stock Option Plan In December 2022, the stockholders approved the 2022 Employee Stock Option Plan (the “2022 Employee Plan”). The plan authorizes the granting of awards, the exercise of which would allow up to an aggregate of 950,000 shares of the Company’s common stock to be acquired by the holders of such awards. Under this plan, the Company may grant stock options, which are intended to FS-28 Table of Contents qualify as incentive stock options (“ISOs”) or non-incentive stock options, to valued employees. Any plan participant who is granted ISOs and possesses more than 10 % of the voting rights of the Company’s outstanding common stock must be granted an option with a price of at least 110 % of the fair market value on the date of grant. Under the 2022 Employee Plan, stock options may be granted to valued employees with a term of up to 10 years at an exercise price equal to or greater than the fair market value on the date of grant and are exercisable, in whole or in part, at 20 % per year beginning on the date of grant. An option granted under this plan shall vest in full upon a “change in control” as defined in the plan. At June 30, 2024, 130,000 stock options were outstanding, 26,000 stock options were exercisable and 820,000 stock options were available for grant under this plan. 130,000 options were granted under this plan during the year ended June 30, 2024. The fair value of each option granted was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions: ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Risk-free interest rates 4.42 - 4.62 % 3.84 % Expected lives 5.63 - 5.87 Years ​ 7.28 Years ​ Expected volatility 56 % 45 % Expected dividend yields .76 - 1.01 % 0.62 % ​ The following table reflects activity under the 2022 Employee plan for the fiscal year ended June 30,: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 ​ ​ ​ ​ ​ Weighted average ​ ​ ​ Weighted average ​ Options exercise price Options exercise price Outstanding, beginning of year ​ 5,000 $ 40.01 ​ — ​ — Granted ​ 130,000 ​ $ 41.38 ​ 5,000 ​ $ 40.01 Forfeited/Lapsed ​ ​ ( 5,000 ) ​ ​ ( 40.01 ) ​ — ​ ​ — Exercised ​ — ​ — ​ — ​ — Outstanding, end of period ​ 130,000 ​ $ 41.38 ​ 5,000 ​ $ 40.01 Exercisable, end of period ​ 26,000 ​ $ 41.38 ​ 1,000 ​ $ 40.01 Weighted average fair value at grant date of options granted ​ $ 21.29 ​ $ 19.77 ​ ​ Total intrinsic value of options exercised ​ n/a ​ n/a ​ ​ Total intrinsic value of options outstanding ​ $ 1,375,000 ​ $ — ​ ​ Total intrinsic value of options exercisable ​ $ 275,000 ​ $ — ​ ​ ​ 130,000 and 5,000 options were granted during the fiscal year ended June 30, 2024 and 2023. No options were exercised during the fiscal year ended June 30, 2023. The following table summarizes information about stock options outstanding under the 2022 Employee Plan at June 30, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options outstanding ​ Options exercisable ​ ​ ​ ​ Weighted average ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number ​ remaining ​ Weighted average ​ Number ​ Weighted average Range of exercise prices outstanding contractual life exercise price exercisable exercise price $ 21.60 - $ 49.39 130,000 9.81 ​ $ 41.38 26,000 ​ $ 41.38 ​ 130,000 9.81 ​ $ 41.38 26,000 ​ $ 41.38 ​ As of June 30, 2024 and 2023, there was $ 2,066,000 and $ 74,000 of unearned stock-based compensation cost related to share-based compensation arrangements granted under the 2020 Non-Employee Plan, respectively. 26,000 and 1,000 options vested during the year ended June 30, 2024 and 2023. The total grant date fair value of the options vesting during the fiscal year ended June 30, 2024 and 2023 under this plan was $ 553,000 and $ 20,000 , respectively. FS-29 Table of Contents NOTE 11 – Stockholders’ Equity Transactions On May 2, 2024 , the Company’s Board of Directors declared a cash dividend of $ .10 per share payable on June 24, 2024 to stockholders of record on June 3, 2024 . On February 1, 2024 , the Company’s Board of Directors declared a cash dividend of $ .10 per share payable on March 22, 2024 to stockholders of record on March 1, 2024 . On November 2, 2023 , the Company’s Board of Directors declared a cash dividend of $ .08 per share payable on December 22, 2023 to stockholders of record on December 1, 2023 . On August 18, 2023 , the Company’s Board of Directors declared a cash dividend of $ .08 per share payable on September 22, 2023 to stockholders of record on September 1, 2023 . On May 5, 2023 , the Company’s Board of Directors declared a cash dividend of $ .0625 per share payable on June 12, 2023 to stockholders of record on May 22, 2023 . During fiscal 2024, certain employees and directors exercised stock options under the Company's 2012 Employee and 2018 Non-Employee Stock Option Plans totaling 153,644 shares. 115,644 of these exercises were completed as cashless exercises as allowed for under the plans, where the exercise shares are issued by the Company in exchange for shares of the Company's common stock that are owned by the optionees. The number of shares surrendered by the optionees was 49,270 and was based upon the aggregate fair market value on the date of the exercise equal to the purchase price being paid. During fiscal 2023, certain employees and directors exercised stock options under the Company's 2012 Employee and 2018 Non-Employee Stock Option Plans totaling 53,000 shares. 43,600 of these exercises were completed as cashless exercises as allowed for under the plans, where the exercise shares are issued by the Company in exchange for shares of the Company's common stock that are owned by the optionees. The number of shares surrendered by the optionees was 17,385 and was based upon the aggregate fair market value on the date of the exercise equal to the purchase price being paid. During fiscal 2022, certain employees and directors exercised stock options under the Company's 2012 Employee and Non-Employee and 2018 Non-Employee Stock Option Plans totaling 34,800 shares. 6,800 of these exercises were completed as cashless exercises as allowed for under the plans, where the exercise shares are issued by the Company in exchange for shares of the Company's common stock that are owned by the optionees. The number of shares surrendered by the optionees was 2,486 and was based upon the aggregate fair market value on the date of the exercise equal to the purchase price being paid. NOTE 12 – Related Party Transaction In March 2024, the Company's President and Chairman sold 2,000,000 shares of our common stock as a selling stockholder in an underwritten secondary public offering at a public offering price of $ 40.75 per share. In connection with such offering, the selling stockholder has granted the underwriters an option to purchase additional shares (the “Greenshoe Option”) up to an additional 300,000 shares of their common stock. On April 8, 2024, the underwriters exercised the Greenshoe Options, pursuant to which the selling stockholder sold an additional 50,000 shares. The Company did not sell any shares in the offering and received no proceeds from the offerings, but the Company incurred $ 407,000 in offering expenses, which are recorded in SG&A in the consolidation statements of income for the year ended June 30, 2024. On February 13, 2023, the Company's Chief Executive Officer and Chairman and the Company’s President, Chief Operating Officer and Chief Financial Officer sold 2,012,500 and 87,500 shares of our common stock, respectively, as selling stockholders in an underwritten secondary public offering at a public offering price of $ 31.50 per share. In connection with such offering, the selling stockholders granted the underwriters an option to purchase additional shares (the “Greenshoe Option”). On February 15, 2023, the underwriters exercised in full the Greenshoe Option, pursuant to which the selling stockholders sold a total of 300,000 additional shares of common stock at the same public offering price. The Company did not sell any shares in the offering and received no proceeds from the offerings, but the Company incurred $ 509,000 in offering expenses, which are recorded in selling, general, and administrative expenses in the accompanying condensed consolidated statements of income. FS-30 Table of Contents NOTE 13 - 401(k) Plan The Company maintains a 401(k) plan (“the Plan”) that is available to all U.S. employees and is qualified under Sections 401(a) and 401(k) of the Internal Revenue Code. Company contributions to this plan are discretionary and totaled $ 258,000 , $ 251,000 and $ 191,000 for the years ended June 30, 2024, 2023 and 2022, respectively. NOTE 14 - Commitments and Contingencies Leases Our lease obligation consists of a 99-year lease, entered into by one of the Company’s foreign subsidiaries, for approximately four acres of land in the Dominican Republic on which the Company’s principal production facility is located. The lease, which commenced on April 26, 1993 and expires in 2092, initially had an annual base rent of approximately $ 235,000 plus $ 53,000 in annual service charges. On September 14, 2022, a lease modification was executed which provides for an annual base rent of $ 235,000 plus $ 105,000 in annual service charges. The service charges increase 2 % annually over the remaining life of the lease. The modification resulted in a remeasurement of the operating lease asset and liability, and the effect was a reduction to the asset and liability of $ 1.3 million. Operating leases are included in operating lease right-of-use assets, accrued expenses and operating lease liabilities, non-current on our condensed consolidated balance sheets. For the fiscal year ended June 30, 2024 and 2023, cash payments against operating lease liabilities totaled $ 343,000 and $ 335,000 , respectively. Supplemental balance sheet information related to operating leases was as follows: ​ ​ ​ ​ ​ Weighted-average remaining lease term 68 Years ​ Weighted-average discount rate ​ 6.25 % ​ The following is a schedule, by years, of maturities of lease liabilities as of June 30, 2024 (in thousands): ​ ​ ​ ​ Year Ending June 30, Amount 2025 ​ $ 345 2026 ​ 347 2027 ​ 349 2028 ​ 351 2029 ​ 354 Thereafter ​ ​ 29,713 Total future minimum lease payments ​ $ 31,459 Less: Imputed interest ​ ​ 25,972 Total ​ $ 5,487 ​ Operating lease expense totaled approximately $ 512,000 , $ 458,000 and $ 319,000 , for the fiscal years ended June 30, 2024, 2023 and 2022, respectively. Litigation On August 29, 2023, a purported class action, brought on behalf of a putative class who acquired publicly traded NAPCO securities between November 7, 2022 and August 18, 2023, was filed in the United States District Court for the Eastern District of New York against the Company, its Chairman and Chief Executive Officer, and its Chief Financial Officer. The action, captioned Zornberg v. NAPCO Security Technologies, Inc. et al., asserts securities fraud claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 in connection with statements made in the Company’s quarterly reports and earnings releases during the period of November 7, 2022 through May 8, 2023. A lead plaintiff was appointed in November 2023 and lead plaintiff filed an Amended FS-31 Table of Contents Complaint on February 16, 2024. The Amended Complaint added claims under Sections 11, 12, and 15 of the Securities Act of 1933 in connection with the secondary public offering in February 2023. These additional claims are brought against the defendants named in the initial complaint, as well as the directors who allegedly signed the offering materials (prospectuses and registration statement in connection with the offering), and the underwriters for the offering. The Company filed a motion to dismiss the Amended Complaint on April 26, 2024. The Company intends to vigorously defend against the action. With respect to all litigation and related matters, the Company records a liability when the Company believes it is probable that a liability has been incurred and the amount can be reasonably estimated. As of the end of the period covered by this report, due to the early stage of the case the Company is not able to estimate any range of potential loss related to this matter and has not recorded any liability. It is possible that the Company could be required to pay damages (in excess of insurance coverages), incur other costs or establish accruals in amounts that could not be reasonably estimated as of the end of the period covered by this report. Employment Agreements As of June 30, 2024, the Company was obligated under three employment agreements and one severance agreement. The employment agreements are with the Company’s CEO, Senior Vice President of Finance and Chief Accounting Officer (“SVP of Finance”), and the Senior Vice President of Engineering and Chief Technology Officer (“the SVP of Engineering”). The severance agreement is with the Company’s President, COO and CFO. The employment agreement with the CEO provides for an annual salary of $ 942,000 , as adjusted for inflation; incentive compensation as may be approved by the Board of Directors from time to time; and a termination payment in an amount up to 299 % of the average of the prior five calendar years’ compensation, subject to certain limitations, as defined in the agreement. The employment agreement renews annually in August unless either party gives the other notice of non-renewal at least six months prior to the end of the applicable term. The employment agreement with the SVP of Finance expires in June 2025 and provides for an annual salary of $ 350,000 . Upon the anniversary date, if terminated by the Company without cause, the SVP of Finance is entitled to severance of six months’ salary and continued company-sponsored health insurance for six months from the date of termination. The employment agreement with the SVP of Engineering expires in August 2024 and provides for an annual salary of $ 440,000 , and, if terminated by the Company without cause, severance of nine months’ salary and continued company-sponsored health insurance for six months from the date of termination. The severance agreement is with the President, Chief Operating Officer and Chief Financial Officer and provides for, if terminated by the Company without cause or within three months of a change in corporate control of the Company, severance of nine months’ salary, based on a salary of $ 604,000 , continued company-sponsored health insurance for six months from the date of termination and certain non-compete and other restrictive provisions. NOTE 15 - Geographical Data The Company is engaged in one major line of business: the development, manufacture, and distribution of security products, encompassing access control systems, door-locking products, intrusion and fire alarm systems and video surveillance products for commercial and residential use. The Company also provides wireless communication service for intrusion and fire alarm systems. These products are used for commercial, residential, institutional, industrial and governmental applications, and are sold worldwide principally to independent distributors, dealers and installers of security equipment. Sales to unaffiliated customers are primarily shipped from the United States. The Company has customers worldwide with major concentrations in North America. FS-32 Table of Contents Financial Information Relating to Domestic and Foreign Operations (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year ended June 30, ​ ​ 2024 2023 2022 Sales to external customers (1) : ​ ​ ​ ​ Domestic ​ $ 187,724 ​ $ 168,619 ​ $ 142,059 Foreign ​ 1,096 ​ 1,378 ​ 1,534 Total Net Sales ​ $ 188,820 ​ $ 169,997 ​ $ 143,593 ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Identifiable assets: ​ ​ ​ United States ​ $ 164,365 ​ $ 122,995 Dominican Republic (2) ​ 43,387 ​ 43,659 Total Identifiable Assets ​ $ 207,752 ​ $ 166,654 ​ (1) All of the Company’s sales originate in the United States and are shipped primarily from the Company’s facilities in the United States. There were no sales into any one foreign country in excess of 10% of total Net Sales. (2) Consists primarily of inventories (2024 = $ 33,584 ; 2023 = $ 33,477 ), operating lease right of use (2024 = $ 5,487 ; 2023 = $ 5,797 ) and fixed assets (2024 = $ 3,623 ; 2023 = $ 3,958 ) located at the Company’s principal manufacturing facility in the Dominican Republic. ​ NOTE 16 – Subsequent Events The Company has evaluated subsequent events occurring after the date of the consolidated financial statements through the date the consolidated financial statements were issued for events requiring recognition or disclosure. On August 22, 2024 , the Company’s Board of Directors declared a cash dividend of $ .125 per share payable on October 3, 2024 to stockholders of record on September 12, 2024 . ​ FS-33 Table of Contents ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None ​ ITEM 9A: CONTROL AND PROCEDURES Evaluation of Disclosure Controls and Procedures We have established disclosure controls and procedures that are designed to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate to allow timely decisions regarding required disclosure. Under the supervision and with the participation of our management, including the CEO and CFO, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rules 13a-15(e) and 15d-15(e) as of the end of the period covered by this report. Based on that evaluation, the CEO and CFO have concluded that our disclosure controls and procedures were not effective as of June 30, 2024, due to the material weakness in our internal control over financial reporting described below. Management’s Report on Internal Control over Financial Reporting Management, including our CEO and CFO, is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a- 15(f) and 15d-15(f) under the Exchange Act) to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our consolidated financial statements for external purposes in accordance with U.S. GAAP. Under the supervision and with the participation of our management, including our CEO and CFO, we have conducted an evaluation of the effectiveness of our internal control over financial reporting based upon the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 COSO framework). Based on evaluation under these criteria, management determined, based upon the existence of the material weakness described below, that we did not maintain effective internal control over financial reporting as of June 30, 2024. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that a reasonable possibility exists that a material misstatement of our annual or interim financial statements would not be prevented or detected on a timely basis. Current Year Material Weakness Management identified a material weakness related to inventory costing. The material weakness was a result of ineffective review of information used in the inventory costing process. Remediation Plan of Current Year Material Weakness Management, with the oversight of the audit committee of our Board of Directors, is currently designing and implementing reconciliation procedures to determine that the information used is complete and accurate and expects to complete these actions during fiscal 2025. While the Company has begun the process to take measures which it believes will remediate the underlying cause of this material weakness, there can be no assurance as to when the remediation plan will be fully developed and implemented and whether such measures will be effective. Until the Company’s remediation plan is fully implemented and effective, the Company will continue to devote time, attention and financial resources to this effort. Deloitte & Touche LLP, our independent registered public accounting firm, has audited the effectiveness of our internal control over financial reporting as of June 30, 2024, and has issued an attestation report on our internal controls over financial reporting, which is included herein. ​ Table of Contents Remediation of Prior Year Material Weaknesses The following material weaknesses as previously disclosed in our Annual Report on Form 10-K for the year ended June 30, 2023, have been remediated. Our management, with the oversight of the audit committee of our Board of Directors, implemented procedures and controls, including: ● Improved the control activities related to information technology user access and program change management. Specifically, we installed monitoring software that logs and tracks the activity of the administrative users and generates reports of all logged activity. ● Implemented quarterly review and reconciliation control activities over the completeness and accuracy of the forecasted sales and usage data utilized in the determination of the reserve for excess and slow-moving inventory. Based upon the above, we believe the steps taken have improved the effectiveness of our internal control over financial reporting and determined that these new or redesigned controls are operating effectively. Changes in Internal Control over Financial Reporting Other than the remediation of the material weaknesses in the internal controls described above, and the planned remediation of the current period material weakness, there were no changes in our internal control over financial reporting during the quarter ended June 30, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ​ ​ ​ Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Napco Security Technologies, Inc. and subsidiaries (the “Company”) as of June 30, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, because of the effect of the material weakness identified below on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of June 30, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended June 30, 2024, of the Company and our report dated August 29, 2024, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Material Weakness A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management's assessment: Management identified a material weakness related to inventory costing. The material weakness was a result of ineffective review of information used in the inventory costing process. ​ Table of Contents This material weakness was considered in determining the nature, timing, and extent of audit tests applied in our audit of the consolidated financial statements as of and for the year ended June 30, 2024, of the Company, and this report does not affect our report on such financial statements. /s/ DELOITTE & TOUCHE LLP Jericho, New York August 29, 2024 ​ ​ Table of Contents ITEM 9B: OTHER INFORMATION The Company adopted an Insider Trading Policy on May 6, 2021. The policy was filed as an exhibit to the Company’s form 8-K filed on May 6, 2021. PART III ITEM 10: DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information about our directors appearing in the Company’s Definitive Proxy Statement for the 2023 Annual Meeting of Stockholders, to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K (“Proxy Statement”) under the heading “Election of Directors”, is incorporated herein by reference. We have adopted a Code of Ethics which applies to our senior executive and financial officers, among others. The Code is posted on our website, www.napcosecurity.com, under the “Investors – Other” caption. We intend to make all required disclosures regarding any amendment to, or waiver of, a provision of the Code of Ethics for senior executive and financial officers by posting such information on our website. The information appearing in the Proxy Statement relating to the members of the Audit Committee and the Audit Committee financial expert under the headings “Corporate Governance and Board Matters – Board Structure and Committee Composition” and “Corporate Governance and Board Matters – Board Structure and Committee Composition – Audit Committee” and the information appearing in the Proxy Statement under the heading “Delinquent Section 16(c) Beneficial Ownership Reporting Compliance” is incorporated herein by this reference. The information set forth in the Proxy Statement under the heading “Information Concerning Executive Officers” is incorporated herein by reference. ITEM 11: EXECUTIVE COMPENSATION ​ ​ ​ ​ ​ ​ ​ The information appearing in the Proxy Statement under the heading “Executive Compensation” and the information appearing in the Proxy Statement relating to the compensation of directors under the caption “Compensation of Directors” are incorporated herein by this reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information appearing in the Proxy Statement under the heading “Beneficial Ownership of Common Stock” is incorporated herein by this reference. Information regarding Equity Compensation Plan Information as of June 30, 2024 is included in Item 5. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information appearing in the Proxy Statement under the headings “Corporate Governance and Board Matters – Independence of Directors,” “Corporate Governance and Board Matters – Board Structure and Committee Composition,” “Corporate Governance – Policy with Respect to Related Person Transactions,” and “Executive Compensation – Certain Transactions” is incorporated herein by this reference. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES Information appearing in the Proxy Statement under the headings “Principal Accountant Fees” and “Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors” is incorporated herein by this reference. ​ ​ Table of Contents PART IV ITEM 15: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a) 1. Financial Statements The following consolidated financial statements of NAPCO Security Technologies, Inc. and its subsidiaries are included in Part II, Item 8: ​ Page Report of Independent Registered Accounting Firm (PCAOB ID 34) FS-2 Report of Independent Registered Public Accounting Firm (PCAOB ID 23) FS-4 Consolidated Financial Statements: Consolidated Balance Sheets as of June 30, 2024 and 2023 FS-5 Consolidated Statements of Income for the Fiscal Years Ended June 30, 2024, 2023 and 2022 FS-6 Consolidated Statements of Stockholders' Equity for the Fiscal Years Ended June 30, 2024, 2023 and 2022 FS-7 Consolidated Statements of Cash Flows for the Fiscal Years Ended June 30, 2024, 2023 and 2022 FS-8 Notes to Consolidated Financial Statements FS-9 ​ (a) 2. Financial Statement Schedules The following consolidated financial statement schedules of NAPCO Security Technologies, Inc. and its subsidiaries are included in Part II, Item 8: B. Supplementary Financial Data (a) 3. and (b). Exhibits Management Contracts designated by asterisk. Exhibit No. Title Ex-3.(i) Certificate of Amendment of Certificate of Incorporation Exhibit-3.(i) to Report on Form 10-K (Commission file No. 0-10004) for the fiscal year ended June 30, 2011 Ex-3.(ii) Certificate of Incorporation as amended Exhibit-3.(ii) to Report on Form 10-K (Commission file No. 0-10004) for the fiscal year ended June, 30 2011 Ex-3.(iii) Second Amended and Restated By-Laws Exhibit 10.3 to Report on Form 8-K (Commission file No. 0-10004) filed on September 8, 2020 Ex-3.(iv) Amendment to the Amended and Restated Certificate of Incorporation Exhibit 3.(iv) to Report on Form 8-K (Commission file No. 0-10004) filed on December 7, 2021 ​ Table of Contents Ex 4.01 Third Amended and Restated Credit Agreement dated June 29, 2012. Exhibit 4.01 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.02 Second Amended and Restated Term A Loan Note Exhibit 4.02 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.03 Second Amended and Restated Term B Loan Note Exhibit 4.03 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.04 Second Amended and Restated Revolving Credit Note Exhibit 4.04 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.05 Second Amended and Restated Swing Line Note Exhibit 4.05 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.06 Continuing General Security Agreement Exhibit 4.06 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.07 Reaffirmation of Collateral Documents Exhibit 4.07 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.08 Reaffirmation of Negative Pledge Exhibit 4.08 to Report on Form 8-K (Commission file No. 0-10004) dated June 29, 2012 Ex 4.09 Amendment No. 3 to Third Amended and Restated Credit Agreement Item 1.01 (e) contained in Report on Form 8-K (Commission file No. 0-10004) dated June 28, 2016 Ex 4.10 Description of the Company’s Securities E-15 Ex 4.11 Amendment No 4. To Fourth Amended and Restated Credit Agreement Exhibit 4.11 to Report on Form 8-K (Commission file No. 0-10004) dated February 9, 2024 *Ex-10.A (ii) 2002 Employee Stock Option Plan Exhibit 10.A(II) to Report on Form 10-K (Commission file No. 0-10004) for the fiscal year ended June 30, 2008 *Ex-10.B 2012 Employee Stock Option Plan Appendix A to Proxy Statement dated October 29, 2012 for Annual Meeting of Stockholders to be held on December 11, 2012 *Ex-10.C 2012 Non-Employee Stock Option Plan Appendix B to Proxy Statement dated October 29, 2012 for Annual Meeting of Stockholders to be held on December 11, 2012 *Ex-10.D 2018 Non-Employee Stock Option Plan Appendix A to Proxy Statement dated October 29, 2018 for Annual Meeting of Stockholders to be held on December 11, 2018 *Ex-10.E 2020 Non-Employee Stock Option Plan Appendix A to Proxy Statement dated April 13, 2020 for Annual Meeting of Stockholders to be held on May 21, 2020 ​ Table of Contents *Ex-10.F 2022 Employee Stock Option Plan Appendix A to Proxy Statement dated October 31, 2022 for Annual Meeting of Stockholders to be held on December 5, 2022 *Ex-10.I Amended and Restated Employment Agreement with Richard Soloway Exhibit 10.I to Report on Form 10-K (Commission file No. 0-10004) for fiscal year ended June 30, 2010 *Ex-10.M Two (2) Year Extension, dated October 21, 2021, of Employment Agreement between the Registrant and Michael Carrieri Exhibit 10.M to Report on Form 10-K (Commission file No. 0-10004) for fiscal year ended June 30, 2023 *Ex-10.N Form of Indemnification Agreement adopted September 3, 2020 Exhibit 10.N to Report on Form 10-K (Commission file No. 0-10004) for fiscal year ended June 30, 2020 *Ex-10.O Severance Agreement between the Registrant and Kevin S Buchel dated December 30, 2015 Exhibit 10.O to Report on Form 10-Q (Commission file No. 0-10004) dated February 1, 2016 *Ex-10.P Compensation Agreement between the Registrant and Stephen Spinelli dated April 6, 2020 Exhibit 10.P to Report on Form 10-K (Commission file No. 0-10004) dated September 13, 2021 Ex-10.Q Compensation Agreement between the Registrant and Andrew Vuono dated June 3, 2024 E-16 Ex-10.R Two (2) Year Extension, dated April 27, 2024, of Employment Agreement between the Registrant and Michael Carrieri E-17 Ex-14.0 Code of Ethics Exhibit 14.0 to Report on Form 10-K (Commission file No. 0-10004) for the fiscal year ended June 30, 2010 Ex-19. 0 Insider Trading Policy Exhibit 14.1 to Report on Form 8-K (Commission File No. 0-10004) dated May 6, 2021 Ex-21.0 Subsidiaries of the Registrant E-18 Ex-23.1 Consent of Independent Registered Accounting Firm – Deloitte & Touche LLP E-19 Ex-23.2 Consent of Independent Registered Accounting Firm – Baker Tilly, LLP E-20 Ex-31.1 Section 302 Certification of Chief Executive Officer E-21 Ex-31.2 Section 302 Certification of Chief Financial Officer E-22 Ex-32.1 Certification of Chief Executive Officer Pursuant to 18 USC Section 1350 and Section 906 of Sarbanes - Oxley Act of 2002 E-23 ​ Table of Contents Ex-32.2 Certification of Chief Financial Officer Pursuant to 18 USC Section 1350 and Section 906 of Sarbanes - Oxley Act of 2002 E-24 Ex.97 Incentive Compensation Clawback Policy E-25 Ex-101.INS Inline XBRL Instance Document ** Ex-101.SCH Inline XBRL Taxonomy Extension Schema Document** Ex-101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document** Ex-101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document** Ex-101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document** Ex-101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document** Ex-104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) ​ ​ ​ ​ ​ Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. August 29, 2024 NAPCO SECURITY TECHNOLOGIES, INC. (Registrant) ​ By: /s/ RICHARD SOLOWAY Richard Soloway Chairman of the Board of Director and Secretary (Principal Executive Officer) ​ Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and the dates indicated. ​ Signature Title Date /s/ RICHARD SOLOWAY Chairman of the Board of Directors, August 29, 2024 Richard Soloway Director and Secretary (Principal Executive Officer) /s/ KEVIN S. BUCHEL President, Chief Operating Officer August 29, 2024 Kevin S. Buchel and Chief Financial Officer (Principal Financial and Accounting Officer) /s/ PAUL STEPHEN BEEBER Director August 29, 2024 Paul Stephen Beeber /s/ RICK LAZIO Director August 29, 2024 Rick Lazio /s/ DONNA SOLOWAY Director August 29, 2024 Donna Soloway /s/ ROBERT UNGAR Director August 29, 2024 Robert Ungar /s/ ANDREW J. WILDER Director August 29, 2024 Andrew J. Wilder ​ ​ ​ ​ ​ /s/ DAVID A. PATERSON Director August 29, 2024 David A. Paterson ​ ​ ​ ​