What changed in this filing

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Item 1A. Risk Factors

2026-09-03 compared with 2025-09-04 · 88 added, 49 removed, 426 unchanged (24% of the section changed)

168 unchanged sentences

to sell assets quickly enough or for sufficient amounts to enable us to meet our obligations.

Our cash and cash equivalents may be exposed

to banking institution risk.

Our cash and cash equivalents may be exposed to banking institution

We hold our cash balances

with a single financial institution which institution is subject to risks, which may include failure or other circumstances that limit

our access to deposits or other banking services.

For example, in March 2023, Silicon Valley Bank (“SVB”) was unable to continue

their operations and the Federal Deposit Insurance Corporation (“FDIC”) was appointed as receiver for SVB.

If similar failures

in financial institutions occur where we hold deposits, we could experience additional risk.

with several financial institutions which are subject to risks, which may include failure or other circumstances that limit our access

to deposits or other banking services.

For example, in March 2023, Silicon Valley Bank (“SVB”) was unable to continue their

operations and the Federal Deposit Insurance Corporation (“FDIC”) was appointed as receiver for SVB.

If similar failures in

financial institutions occur where we hold deposits, we could experience additional risk.

Any such loss or limitation on our cash and

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be realized, and we could lose some or all of our investments, which could adversely affect our financial condition and results of operation.

We invest a significant portion

of our excess capital in marketable securities, including equity securities of publicly traded companies.

At June 30, 2025, the fair value

of our investments was approximately $6.9 million.

We invest a portion of our

excess capital in marketable securities, including equity securities of publicly traded companies.

At June 30, 2026, the fair value of

our investments was approximately $1.7 million.

While we intend to hold our investments until such time as we believe it is appropriate

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which could adversely affect our business, financial condition, and results of operations.

We have acquired, and may

acquire in the future, businesses, products, and technologies that complement or expand our current operations.

Acquisitions could require

significant capital investments and require us to integrate with companies that have different cultures, management teams, and business

infrastructure.

Depending on the size and complexity of an acquisition, our successful integration of the acquisition could depend on

several factors, including:

As part of our strategy, we

are actively exploring acquisition opportunities.

We have acquired, and may acquire in the future, businesses, products, and technologies

that complement or expand our current operations.

Acquisitions could require significant capital investments and require us to integrate

with companies that have different cultures, management teams, and business infrastructure.

Depending on the size and complexity of an

acquisition, our successful integration of the acquisition could depend on several factors, including:

Difficulties in assimilating and integrating the operations, products, and workforce of an acquired business;

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to litigation related to environmental remediation claims.

We maintain insurance to protect against claims associated with the manufacture

and use of our products as well as environmental pollution, but there can be no assurance that our insurance coverage will adequately

Additionally, from time to time, including currently, we are involved in various

labor claims or other personnel matters.

We maintain insurance to protect against claims associated with the manufacture and use of our

products as well as environmental pollution and employment practices, but there can be no assurance that our insurance coverage will adequately

cover any claim asserted against us.

47 unchanged sentences

condition, cash flows, revenue, and results of operations.

We have previously identified material weaknesses

in our internal control over financial reporting.

Failure to achieve and maintain effective internal control over financial reporting

could materially and adversely affect our business, results of operations, financial condition, and stock price.

We identified material weaknesses

in our internal control over financial reporting as of June 30, 2024, and June 30, 2023.

The material weaknesses as of June 30,

2024, related to our inventory accounting and the valuation of one of our Level 2 investments.

The material weakness as of June 30,

2023, related to the valuation of our Level 3 investments.

As a result of these material weaknesses, as of June 30, 2024, and

June 30, 2023, our management concluded that our internal control over financial reporting was not effective based on the framework

in Internal Control-Integrated Framework (2013) , issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In fiscal 2025 and 2024, we

implemented remediation plans designed to address our June 30, 2024 and 2023, material weaknesses, which were both time consuming

In addition, if additional material weaknesses or significant deficiencies in our internal control are discovered or occur

in the future, our consolidated financial statements may contain material misstatements and we could be required to restate our financial

If we or our auditors discover

one or more additional material weaknesses in our internal controls in the future, the market’s confidence in our financial statements

could decline and our stock price may be harmed.

In addition, our failure to maintain effective controls over financial reporting could

subject us to sanctions or investigations by The Nasdaq Stock Market, the SEC, or other regulatory authorities.

Our evaluation of internal controls and remediation

of potential problems is costly and time-consuming and could expose weaknesses in financial reporting.

of potential problems is costly and time-consuming and we have previously identified material weaknesses in our internal control over

financial reporting.

Failure to achieve and maintain effective internal control over financial reporting could materially and adversely

affect our business, results of operations, financial condition, and stock price.

Section 404 of the Sarbanes-Oxley

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This process is expensive and time consuming and requires significant attention of management.

Management can give no assurance that material

weaknesses in internal controls will not be discovered (see above, “ We have previously identified material weaknesses in our

internal control over financial reporting.

Failure to achieve and maintain effective internal control over financial reporting could materially

and adversely affect our business, results of operations, financial condition, and stock price.

For example, we identified material weaknesses

in our internal control over financial reporting as of June 30, 2024, and June 30, 2023.

In fiscal 2025 and 2024, we

implemented remediation plans designed to address our June 30, 2024 and 2023, material weaknesses, which were both time consuming

We completed the remediation of the previously identified material weaknesses, and as described in Item 9A of this report,

management concluded that our internal control over financial reporting was effective as of June 30, 2026.

Notwithstanding the foregoing,

we cannot be certain that additional material weaknesses or significant deficiencies in our internal control over financial reporting

will not be identified or occur in the future.

If additional material weaknesses or significant deficiencies in our internal control are

discovered or occur in the future, our consolidated financial statements may contain material misstatements and we could be required to

restate our financial results.

We cannot be certain that

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statements and harm our stock price, especially if a restatement of financial statements for past periods is required.

Our acquisition of APM may increase our exposure

to complex export control and government contracting requirements, the violation of which could have a material adverse effect on our

As a result of our acquisition

of APM in February 2026, we have increased exposure to defense and aerospace-related customers, programs, products and/or technical data.

APM operates a manufacturing facility located in Costa Mesa, California and manufactures precision machined components and assemblies

for the medical, aerospace and defense industries, including parts and assemblies for aerospace and defense systems.

In addition, APM

serves as a Prime Contractor for the U.S.

Government and, as such, maintains registrations under ITAR and a JCP certification.

As a result, we may become

subject to additional and more complex regulatory requirements than those historically applicable to our business.

These requirements

may include U.S.

export control and sanctions regimes, including ITAR and EAR, as well as other laws and regulations that apply to the

performance of U.S.

government contracts.

A change in such laws or regulations at any time may have an adverse effect on our operations.

These statutes and regulations

can be complex and subject to diverse, often conflicting, interpretations, which may change over time.

Compliance may require us to implement

and maintain additional policies, procedures, training, and internal controls, and to devote significant management attention and resources

to compliance activities.

In addition, we may be required to obtain and maintain registrations, certifications, licenses, authorizations

or approvals;

monitor and restrict access to controlled items, information and technology;

and comply with flow-down requirements imposed

by customers and government agencies in connection with government-funded or government-related programs.

If we fail to comply with

export control, sanctions, or government contracting requirements (including requirements associated with APM’s ITAR registration

and JCP certification), we could be subject to civil and criminal penalties, including fines, the loss, suspension or limitation of export

privileges, the loss, suspension, limitation, or non-renewal of certifications or registrations, the imposition of enhanced compliance

measures, contract termination, the loss of government contract opportunities, or suspension or debarment from doing business with the

government or from participating in government-funded programs.

The penalties for non-compliance could range from an administrative

warning to termination of a portion of our business.

Furthermore, even if we are subsequently determined to have fully complied with applicable

laws or regulations, the costs to achieve such a determination and the intervening loss of business could adversely affect or result in

the cessation of a portion of our business.

In addition, the APM acquisition

was completed in large part to support expansion of our business and to support increased demand resulting from a contract extension with

our largest customer, and APM’s Costa Mesa facility provides machined assemblies to service that customer while also providing machining

to other customers primarily in the defense and aerospace industries.

To the extent this increases our reliance on defense-related or

government-funded demand or increases our exposure to a limited number of significant customer relationships, our revenue may become more

sensitive to government budgets, appropriations, procurement priorities, and political and policy shifts, as well as to the continuation,

renewal, or termination of key customer arrangements.

Any reduction, delay, or cancellation of spending or programs affecting such customers,

or any contract termination or loss of relevant registrations or certifications, could have a material adverse effect on our business,

financial condition, and results of operations.

General Risks

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

What changed 10-K

Item 1A. Risk Factors