What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2022-09-27 compared with 2021-09-28 · 467 added, 380 removed, 382 unchanged (69% of the section changed)

CONTROLS AND PROCEDURES.

Management’s Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer and our Chief Financial

9 unchanged sentences

that such information is accumulated and communicated to our management.

Management’s Annual Report on Internal

Control Over Financial Reporting

4 unchanged sentences

misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, with our Company have been

A “material weakness”

is defined as

a significant deficiency, or a combination of significant deficiencies, that results in more than a remote likelihood that a material

A “material weakness” is defined

as a significant deficiency, or a combination of significant deficiencies, that results in more than a remote likelihood that a material

misstatement of the annual or interim financial statements will not be prevented or detected.

A “significant deficiency”

a control deficiency, or a combination of control deficiencies, that adversely affects a company’s ability to initiate, authorize,

A “significant deficiency”

is a control deficiency, or a combination of control deficiencies, that adversely affects a company’s ability to initiate, authorize,

record, process or report external financial data reliably in accordance with generally accepted accounting principles such that there

is more than a remote likelihood that a misstatement of the annual or interim financial statements that is more than inconsequential will

not be prevented or detected.

is more than a remote likelihood that a misstatement of the annual or interim financial statements that is more than inconsequential

will not be prevented or detected.

Under the supervision and with the participation

2 unchanged sentences

In making this assessment, management used the criteria set forth

by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control —

Integrated Framework

by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework

Based on our evaluation, our management concluded that our internal control over financial reporting was not effective as

of June 30, 2022.

The following is a description of two material

weaknesses in our internal control over financial reporting:

Segregation of Duties :

As previously disclosed

in our Annual Reports on Form 10-K for the fiscal years ended June 30, 2008-2020, our management identified a control deficiency during

the 2008 fiscal year because we lacked sufficient staff to segregate accounting duties.

We believe the control deficiency resulted primarily

because we have the equivalent of six persons performing all accounting-related on-site duties at two locations.

As a result, we did not

maintain adequate segregation of duties within our critical financial reporting applications, the related modules and financial reporting

This control deficiency could result in a misstatement of balance sheet and income statement accounts in our interim or annual

consolidated financial statements that would not be detected.

Accordingly, management has determined that this control deficiency constitutes

a material weakness.

The following is a description of a material weaknesses

in our internal control over financial reporting:

Physical Inventory Count at June, 30, 2022 :

The Company did not perform any procedures to

verify the quantities of inventory at Lighthouse prior to the identification of errors by our independent auditors performing test counts.

These test counts and subsequent counts performed by Company personnel clearly identified errors.

This lack of any procedure to verify

inventory quantities was a control deficiency at June 30,2022 which is considered a material weakness.

To address and remediate the material weakness

in internal control over financial reporting described above, beginning with the quarter ended September 30, 2008, we instituted a procedure

whereby our Chief Executive Officer, our Chief Financial Officer and other members of our Board of Directors perform a higher level review

of the quarterly and annual reports on Form 10-Q and Form 10-K prior to filing.

in internal control over financial reporting described above, beginning with the quarter ended September 30, 2022, we intend to perform

a total physical inventory count at the Lighthouse division location and use those quantities to value inventory at the Lighthouse division

as of that date.

Additionally, we intend to continue to improve our perpetual inventory systems at the Lighthouse division and continue

to perform physical inventory counts at the financial statement reporting dates until it is determined that the perpetual inventory system

can be relied upon for the valuation of inventory at any specific financial reporting date.

We believe that the step outlined above strengthens

our internal control over financial reporting and mitigates the material weakness described above.

As part of our 2021 assessment of internal

control over financial reporting, our management has evaluated this additional control and has determined that it is operating effectively.

Inventory Valuation :

As previously disclosed

in our Annual Reports on Form 10-K for the fiscal years ended June 30, 2009-2020, we reported a material weakness with respect to the

valuation of our inventories.

Specifically, the amounts used to value our inventory at June 30, 2009 with respect to overhead rates and

purchased items were often inconsistent with the supporting documentation, due to year-to-year changes in overhead rates and costs of

purchased items that were not properly reflected in inventory valuation.

Accordingly, management had determined that this control deficiency

constituted a material weakness as of June 30, 2009.

One audit adjustment of approximately $58,000 to our audited financial statements

as of June 30, 2011 was necessary as a result of this condition.

To address and remediate the material weakness

in internal control over financial reporting described above, beginning in the quarter ended September 30, 2009 and continuing through

the year ended June 30, 2021, we implemented procedures to improve our inventory controls and documentation surrounding inventory valuation

for overhead rates, and performed procedures to ensure that the pricing of inventory items was consistent with the supporting documentation.

We believe that the step outlined above strengthens our internal control over financial reporting and mitigates the material weakness

described above.

We intend to continue to remediate material weaknesses

and enhance our internal controls but cannot guarantee that our efforts will result in remediation of our material weaknesses or that

new issues will not be exposed in this process.

As part of our preparation of the June

30, 2022 financial statements, we performed a physical count of inventory at the Lighthouse division location and believe this has fully

remediated the inventory valuation weakness as of that date.

We intend to continue to remediate the material

weakness described above and enhance our internal controls but cannot guarantee that our efforts will result in remediation of our material

weakness or that new issues will not be exposed in this process.

Changes in Internal Control over Financial

There was no change in our internal control over

financial reporting that occurred during the fourth quarter of our fiscal year covered by this Annual Report on Form 10-K that has materially

affected, or is reasonably likely to materially affect, our internal control over financial reporting.

financial reporting that occurred during the fiscal year covered by this Annual Report on Form 10-K that has materially adversely affected,

or is reasonably likely to materially adversely affect, our internal control over financial reporting.

OTHER INFORMATION.

DIRECTORS, EXECUTIVE OFFICERS AND

CORPORATE GOVERNANCE.

DIRECTORS, EXECUTIVE

OFFICERS AND CORPORATE GOVERNANCE.

Identification of Directors

6 unchanged sentences

Our Board of Directors

is divided into three classes that are as nearly equal in number as possible, with each class serving for a staggered term of office.

Only one class is elected each year.

Each director serves a three-year term and until his or her successor has been duly elected and qualified.

Our Board currently consists of four directors.

Our Class I director is Peter H.

Our Class II director is Andrew J.

Our Class III directors are Joseph N.

currently consists of five directors.

Each director will stand for election at each annual meeting of stockholders.

Our directors are

Woodward, Peter V.

Anania, Andrew J.

Miclot, Joseph N.

Forkey and Richard B.

Woodward, Mr.

Miclot and Dr.

considered “independent directors” as independence is currently defined in Rule 5605(d)(2) of the Nasdaq Stock Markets listing

standards and SEC Rule 10A-3.

The Audit Committee members are Mr.

Woodward, Mr.

Miclot and Dr.

Miles, and the Compensation Committee members

Woodward and Mr.

Biographies and Qualifications of Our Directors.

The biographies of our directors and certain information regarding each director’s experience, attributes, skills and/or qualifications

that led to the conclusion that the individual should be serving as a director of our Company are as follows:

On October 6, 2021, our Board appointed Mr.

Anania as a director.

Anania is President of Anania & Associates which he founded in 1987, and Anania & Associates

Investment Company LLC, a private investment firm focused on privately held, Maine-based businesses which he founded in January 2008.

Since November 2000, he serves as President and on the Board of Microwave Techniques LLC, Elmet Technologies, LLC and since December 2018

he serves on the board and audit committee of Alaris Holdings Ltd.

He has served in operating and board positions of numerous private

companies in which he has invested and performed management consulting services to non-portfolio companies.

Anania served on the Windham

Town Council from 2011 to 2014, board of the Windham Economic Development Corporation, Maine Heritage Policy Center (Chairman);

Corporator for Bangor Savings Bank;

an Emeritus Board member of the Maine International Trade Center participating in trade missions to

Korea, the United Kingdom, Brazil, Argentina, Taiwan, Singapore, Germany, the Netherlands and Mexico;

and serves as a charter member of

Maine's District Export Council helping small businesses expand their export sales.

He previously served on the board of the USM Alumni

Association, the Family Crisis Center, the United Way Allocation Committee and Raye’s Mustard Mill in Eastport.

from the University of Maine in marketing and management and an MBA from the University of Southern Maine.

Forkey has served as our Chief Executive

21 unchanged sentences

knowledge to our Company.

Since September 2020, Mr.

Miclot was President of Electromedical Products International, Inc., a medical device

company treating Anxiety, Insomnia, Depression and Pain.

Miclot was the President and Vice Chairman and Director of WishBone Medical,

Inc., a pediatric orthopedic company dedicated to the unmet needs of children suffering from orthopedic

challenges from October 2017 to January 2019.

He has been on the Indiana University Alumni Association Advisory Board since October

From September 2020 to May 2021, Mr.

Miclot was President of Electromedical Products International, Inc., a

medical device company treating anxiety, insomnia, depression and pain.

Miclot was the President and Vice Chairman and Director of

WishBone Medical, Inc., a pediatric orthopedic company dedicated to the unmet needs of children suffering from orthopedic challenges from

October 2017 to January 2019.

He was on the Indiana University Alumni Association Advisory Board from October 2016 to September 2021.

From October 2015 to January 2018, Mr.

Miclot served as President, CEO and Director of Micro Machine Co., a supplier of medical

products for the orthopedic and spinal industries.

Miclot served as President, CEO and Director of Micro Machine Co., a supplier of medical products

for the orthopedic and spinal industries.

Prior to joining Micro Machine Co., from May 2013 to September 2014, Mr.

Executive Vice President of MicroTechnologies, Inc., a medical device supplier.

Miclot was General Manager and Senior Vice President

of ArthroCare Corporation from June 2009 to March 2013.

Miclot was Executive

Vice President of MicroTechnologies, Inc., a medical device supplier.

Miclot was General Manager and Senior Vice President of ArthroCare

Corporation from June 2009 to March 2013.

From January 2008 to March 2009, Mr.

Miclot was President, CEO and Director of

Ascension Orthopedics, Inc.

Miclot was President, CEO and Director of Ascension Orthopedics,

He was Vice President of Marketing for the orthopedic global business unit at Orthofix, Inc.

from April 2007

to January 2008, and from March 1994 to April 2007, he served as Senior Vice President with Symmetry Medical Inc., a medical device supplier

and was also the Investor Relations Officer, after the NYSE IPO in December 2004 until April 2007.

Miclot has a BA degree in Speech

and Hearing and a MA degree in Audiology from Indiana University and an MBA from the Lake Forest Graduate School of Management, earned

from April 2007 to January 2008, and

from March 1994 to April 2007, he served as Senior Vice President with Symmetry Medical Inc., a medical device supplier and was also the

Investor Relations Officer, after the NYSE IPO in December 2004 until April 2007.

Miclot has a BA degree in Speech and Hearing and

a MA degree in Audiology from Indiana University and an MBA from the Lake Forest Graduate School of Management, earned in 1991.

Professor Richard B.

1 unchanged sentence

Board of Directors in November 2005.

He was a member of the Mechanical and Aerospace Engineering faculty at Princeton University from

1972 until 2013, at which time he retired from his Princeton academic appointment and became Professor Emeritus and Senior Scholar.

1980 to 1996 he served as Chairman of Engineering Physics at Princeton.

In 2017 he joined Texas A&M University and was appointed TEES

Eminent Professor of Aerospace Engineering.

In 2019 he was named Distinguished University Professor and O’Donnell Foundation Chair

He received his Ph.D.

degree in Electrical Engineering from Stanford University in 1972 with a thesis

on nonlinear optics.

He was a member of the Mechanical and Aerospace Engineering faculty at Princeton University from 1972 until 2013,

at which time he retired from his Princeton academic appointment and became Professor Emeritus and Senior Scholar.

From 1980 to 1996 he

served as Chairman of Engineering Physics at Princeton.

In 2017 he joined Texas A&M University and was appointed TEES Eminent Professor

of Aerospace Engineering.

In 2019 he was named Distinguished University Professor and is currently the holder of the O’Donnell Foundation

He is a member of the National Academy of Engineering and a Fellow of the National Academy of Inventors.

He serves on the Board of

Directors of the Hertz Foundation and the Board of Trustees of Pacific University, Oregon and is a Fellow of the Optical Society of America

(OSA) and the American Institute Aeronautics and Astronautics (AIAA).

Professor Miles is a valuable member of our Board due to his depth

of scientific experience and familiarity with the field of our technologies, insight into the academic community, and familiarity with

the latest developments and innovations in science and technology.

Woodward was appointed to our Board effective

July 9, 2014 and as chairman of the Board in connection with the sale and purchase agreement we entered into in July 2014.

is the founder of MHW Capital Management, LLC, or MHW, a position he has held since September 2005.

MHW specializes in large equity investments

in public companies implementing operating strategies to significantly improve their profitability.

He serves on the Board

of Directors of the Hertz Foundation and the Board of Trustees of Pacific University, Oregon and is a Fellow of the Optical Society of

America (OSA) and the American Institute Aeronautics and Astronautics (AIAA).

In 1997 he founded Plasma TEC, Inc, and currently serves

Professor Miles is a valuable member of our Board due to his depth of scientific experience and familiarity with the field

of our technologies, insight into the academic community, and familiarity with the latest developments and innovations in science and

Woodward was appointed to our Board effective July 9, 2014 and

as chairman of the Board in connection with the sale and purchase agreement we entered into in July 2014.

Woodward is the founder

of MHW Capital Management, LLC, or MHW, a position he has held since September 2005.

MHW specializes in large equity investments in public

companies implementing operating strategies to significantly improve their profitability.

From 1996 to 2005, Mr.

the Managing Director for Regan Fund Management, LLC.

He served as the President and Chief Executive Officer and Director of Cartesian,

from June 2015 to July 2018, and currently serves as Chairman of the Board and Chairman of the Audit Committee for TSS, Inc., and

as the CEO of Innoative Power, LLC.

Woodward holds a BA in economics from Colgate University and a Masters of International Affairs

with a concentration in international economics and finance from Columbia University.

Woodward was the Managing

Director for Regan Fund Management, LLC.

He served as the President and Chief Executive Officer and Director of Cartesian, Inc.

2015 to July 2018, and currently serves as Chairman of the Board and Chairman of the Audit Committee for TSS, Inc., and as the CEO of

Innovative Power, LLC.

Woodward holds a BA in economics from Colgate University and a Masters of International Affairs with a concentration

in international economics and finance from Columbia University.

He is also a Chartered Financial Analyst.

6 unchanged sentences

Biographies and Qualifications of Our Executive

The biographies of our executive officers and certain information regarding each officer’s experience, attributes,

skills and/or qualifications that led to the conclusion that the individual should be serving as an executive officer of our Company are

Forkey’s full biography, please

refer to the section entitled “Biographies and Qualifications of Our Directors.”

Forkey’s full biography, please

refer to the section entitled “Biographies and Qualifications of Our Directors.”

Habhegger started with us in September 2019

24 unchanged sentences

to us by our officers and directors, we believe that, during the fiscal year ended June 30, 2022, no person required to file reports under

Section 16(a) of the Securities Exchange Act of 1934 failed to file such reports on a timely basis during such fiscal year, except for

four reports by four of our employees, including our Chief Executive Officer, Dr.

Forkey, our Chief Financial Officers, Daniel Habhegger,

and Divaker Mangadu, for one transaction each, filed late by one day each.

We are also aware that Dolphin Offshore Partners LP which owns

approximately 20% of our common stock based on available public records as of September 21, 2021 has not filed a Form 3 to date.

Offshore Partners LP is not affiliated with our Company.

Section 16(a) of the Securities Exchange Act of 1934 failed to file such reports on a timely basis during such fiscal year, except that

Dolphin Offshore Partners LP which owns approximately 12% of our common stock based on available public records as of September 20, 2022

has not filed a Form 3 to date.

Dolphin Offshore Partners LP is not affiliated with our Company.

Code of Ethics

19 unchanged sentences

to our Board of Directors and stating why the candidate believes that he or she would be a valuable addition to our Board of Directors;

a summary of the candidate’s work experience for the prior five years and the number of shares of our stock beneficially owned by

the candidate.

6 unchanged sentences

for establishing broad corporate policies and reviewing our overall performance rather than day-to-day operations.

The Board’s primary

responsibility is to oversee management of our Company and, in so doing, serve the best interests of our Company and our stockholders.

Our Board of Directors has the ability to establish,

or disband, such committees as necessary or appropriate to serve the needs of our Company.

In February 2012, our Board of Directors made

the determination to restructure and unanimously voted to disband its committees, including its Audit Committee.

Our full Board of Directors

performs all of the functions normally designated to an audit committee, compensation committee and nominating committee.

Our Board of Directors has the ability to establish, or disband, such

committees as necessary or appropriate to serve the needs of our Company.

For many years, our full Board of Directors performed all of

the functions normally designated to an audit committee, compensation committee and nominating committee.

Recently, the Board decided

to designate an Audit Committee and a Compensation Committee, in part to satisfy Nasdaq Stock Markets requirements in contemplation of

our Nasdaq listing application.

Audit Committee and Audit Committee Financial Expert

As of February 2012, the Board of Directors no

longer has a separately designated audit committee.

The functions of the audit committee are conducted by the entire Board, whose members

are named above.

We do not currently have an “audit committee financial expert,”

as defined in Item 407(d)(5)(ii) of Regulation S-K.

We believe that each member of our Board is financially

literate and possesses sufficient experience, both professionally and by virtue of his service on our Board, to be fully capable of discharging

his duties as a member of our Board performing audit committee functions.

The Audit Committee of the Board of Directors was established by the

Board in July 2022 and is currently composed of Messrs.

Woodward (Chair), Miclot and Miles.

The Audit Committee acts on behalf of the

Board and its primary function is to oversee the financial reporting and disclosure process.

The Audit Committee has adopted a charter,

which is available on the Company’s website.

The Audit Committee has reviewed with management the audited financial

statements included in this Form 10-K;

discussed with the Company’s independent auditors the matters required to be discussed by

the applicable requirements of the Public Company Accounting Oversight Board and the Securities and Exchange Commission;

reviewed the written disclosures and the letter from the Company’s independent auditors’ required by the applicable requirements

of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the audit committee

concerning independence;

and has discussed with the independent account the independent accountant’s independence.

Based on these

reviews and discussions, the Audit Committee has recommended to the Board of Directors that the audited financial statements be included

in this Form 10-K for the fiscal year ended June 30, 2022.

The Board of Directors has made a determination that Peter H.

Chairman of the Board and Chair of the Audit Committee, qualifies as an audit committee financial expert and meets the criteria set forth

in Item 407(d)(5) of Regulation S-K.

Woodward is an “independent director” as independence is currently defined in Rule

5605(d)(2) of the Nasdaq Stock Markets listing standards and SEC Rule 10A-3.

Woodward has an understanding of generally accepted accounting

principles and financial statements and has the ability to assess the general application of such principles in connection with the accounting

for estimates, accruals and reserves, and has an understanding of internal controls over financial reporting as well as audit committee

Woodward’s biography and qualifications described above in Item 10 of this Form 10-K.

Compensation Committee

The Compensation Committee of the Board of Directors

was established by the Board in May 2022 and is currently composed of Messrs.

Woodward and Miclot (Chair).

The Compensation Committee

has adopted a charter, which is available on the Company’s website.

Under its charter, the Compensation Committee of the Board acts on

behalf of the Board to review and oversee the Company’s overall compensation philosophy, and to oversee the development and implementation

of compensation programs aligned with the Company’s business strategy.

Specifically, the Compensation Committee’s authority

includes reviewing and approving annually the corporate goals and objectives applicable to the compensation of the chief executive officer

, and to evaluate at least annually the CEO’s performance in light of those goals and objectives, and determine and approve the

CEO’s compensation level based on that evaluation.

In evaluating and determining CEO compensation, the Committee considers the results

of the most recent stockholder advisory vote on executive compensation (“Say on Pay Vote”) required by Section 14A of the

Exchange Act.

The CEO is not allowed to be present during any voting or deliberations by the Committee on CEO compensation.

Additionally,

the Compensation Committee approves the compensation of all other executive officers, in consultation with the CEO.

In evaluating and

determining executive compensation, the Committee considers the results of the most recent Say on Pay Vote.

The Compensation Committee

also makes recommendations to the Board regarding the adoption of Stock Plans and equity-based plans, which includes the ability to amend

and terminate such plans.

The Compensation Committee has the authority to administer the Company’s Stock Plans and equity-based

plans, including designation of the employees to whom the awards are to be granted, the amount of the award or equity to be granted and

the terms and conditions applicable to each award or grant, subject to the provisions of each plan.

The Compensation Committee is responsible

for overseeing the Company’s submission to a stockholder vote of matters relating to compensation, including advisory votes on executive

compensation and the frequency of such votes, incentive and other compensation plans, and amendments to such plans.

The Compensation Committee

is also responsible for performing any other activities required by applicable law, rules or regulations, including the rules of the SEC

and any exchange or market on which the Company’s capital stock is traded, and performs other activities that are consistent with

the Compensation Committee’s charter, the Company’s certificate of incorporation and bylaws, and governing laws, as the Compensation

Committee or the Board deems necessary or appropriate.

The charter of the Compensation Committee grants the Compensation Committee

full access to all books, records, facilities and personnel of the Company.

In addition, under the charter, the Compensation Committee

has the discretion and authority to obtain, at Company expense, advice and assistance from compensation consultants and internal and external

legal, accounting or other advisors and other external resources that the Compensation Committee considers necessary or appropriate in

the performance of its duties.

COMPENSATION.

3 unchanged sentences

for our fiscal years ended June 30, 2022, and 2021 awarded to, earned by, or paid to our Principal Executive Officer, our most highly

compensated executive officer and our most highly compensated employees, all of which are referred to herein as the “Named Executive

Officers”.

compensated executive officer and our other most highly compensated employee, all of whom are referred to herein as the “Named

Executive Officers”.

Summary Executive Compensation Table for the

4 unchanged sentences

Chief Financial Officer, Secretary

Divaker Mangadu

President, Ross Optical Division

Represents the aggregate grant date fair value of stock awards granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation —

Stock Compensation.

The fair value of each option granted is estimated on the date of grant using the Black-Scholes option valuation model.

A discussion of the assumptions used in calculating the amounts in this column may be found in the Notes to our audited consolidated financial statements for the year ended June 30, 2021 set forth in this Annual Report on Form 10-K.

These amounts do not represent the actual amounts paid to or realized by the executives during the fiscal years presented.

Represents the aggregate grant date fair value of stock option awards granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation —

Stock Compensation.

Senior Vice President Sales and Marketing

Represents the aggregate grant date fair value of stock option awards granted in the respective fiscal year as computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation.

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option valuation model.

3 unchanged sentences

Forkey a stock option to purchase up to 150,000 shares of our common stock at an exercise price of $1.68 per share, the closing price of our common stock on June 4, 2021.

75,000 options vested on the date of grant, and provided Dr.

Forkey remains eligible under the plan on the future vesting date, the remaining 75,000 options vest on June 4, 2022.

75,000 options vested on the date of grant, and the remaining 75,000 options vest on June 4, 2022.

Represents the fair value of performance bonus award paid in the form of common stock.

We granted Mr.

Habhegger a stock option to purchase up to 80,000 shares of our common stock at an exercise price of $1.68 per share, the closing price of our common stock on June 4, 2021.

40,000 options vested on the date of grant, and provided Mr.

Habhegger remains eligible under the plan on the future vesting date, the remaining 40,000 options vest on June 4, 2022.

We granted Mr.

Habhegger a stock option to purchase up to 100,000 shares of our common stock at an exercise price of $1.42 per share, the closing price of our common stock on September 9, 2019.

Habhegger remains eligible under the plan on these dates, the options vest on September 9, 2020, 2021 and 2022 in amounts of 33,334, 33,333 and 33,333 options, respectively.

40,000 options vested on the date of grant, and the remaining 40,000 options vest on June 4, 2022.

Represents performance bonus awards for the respective fiscal year.

We granted Mr.

Mangadu a stock option to purchase up to 25,000 shares of our common stock at an exercise price of $1.68 per share, the closing price of our common stock on June 4, 2021.

12,500 options vested on the date of grant, and provided Mr.

Mangadu remains eligible under the plan on the future vesting date, the remaining 12,500 options vest on June 4, 2022.

DiRubio a stock option to purchase up to 25,000 shares of our common stock at an exercise price of $1.68 per share, the closing price of our common stock on June 4, 2021.

12,500 options vested on the date of grant, and the remaining 12,500 options vest on June 4, 2022.

We granted Mr.

Mangadu a stock option to purchase up to 100,000 shares of our common stock at an exercise price of $1.30 per share, the closing price of our common stock on September 5, 2019.

Mangadu remains eligible under the plan on these dates, the options vest on September 5, 2020, 2021 and 2022 in amounts of 33,000, 33,000 and 34,000 options, respectively.

DiRubio a stock option to purchase up to 100,000 shares of our common stock at an exercise price of $2.09 per share, the closing price of our common stock on February 7, 2022.

These options vest in three pro rata increments on February 7, 2023, 2024, and 2025.

Employment Contracts

7 unchanged sentences

Board of Directors approved an increase of Dr.

Forkey’s base salary to $250,000 per year.

On August 2, 2018, we also granted Dr.

1 unchanged sentence

The options vested

(i) one–half of the options vest if we achieved revenues of $1.5 million or higher for two consecutive fiscal quarters,

based on the reported revenues in our Form 10-Ks or 10-Qs;

1 unchanged sentence

$1.00 per share or higher for fifteen consecutive trading days.

In the event of a change of control all unvested options will vest.

of June 30, 2020, all 350,000 options are vested.

As of June 30, 2022, all 350,000 options are vested.

We also granted Dr.

Forkey 300,000 shares of common stock at a rate of 50,000 shares

per fiscal quarter retroactively starting January 1, 2017 and through the quarter ended June 30, 2018.

As of June 30, 2020, all 300,000

of such shares have been issued to Dr.

Forkey 300,000 shares of common stock at a rate of 50,000 shares per fiscal quarter retroactively starting January 1, 2017 and through

the quarter ended June 30, 2018.

As of June 30, 2022, all 300,000 of such shares have been issued to Dr.

Agreement with Mr.

5 unchanged sentences

Habhegger is terminated within six months of a change of control he will receive

six months’

notice or pay in lieu of notice at his then current salary rate.

six months’ notice or pay in lieu of notice at his then current salary rate.

Agreement with Mr.

In connection with the acquisition of the Ross

Optical division we entered into an employment agreement on July 1, 2019 with Divaker (Divi) Mangadu to serve as President of Ross Optical

Industries (a division of Precision Optics Corporation).

The agreement covers a period of five years unless terminated sooner under certain

conditions by the parties and may be renewed beyond the initial and subsequent terms for additional one-year periods.

also granted a stock option to purchase up to 100,000 shares of our common stock at an exercise price of $1.30 per share, the closing

price of our common stock on September 5, 2019.

Mangadu remains eligible under the plan on these dates, the options vest

on September 5, 2020, 2021 and 2023 in amounts of 33,000, 33,000 and 34,000 options, respectively.

Mangadu is terminated without

cause by the Company during the initial five year term of the agreement, he shall receive a lump-sum $75,000 cash severance payment and

all unexercised stock options shall vest immediately and be exercisable for the remainder of their term.

Mangadu is terminated

without cause subsequent to the initial five-year term, he shall receive a lump-sum cash severance payment equal to one-half his then

current annual salary.

The agreement also provides that for a period of five years after July 1, 2019 Mr.

Mangadu agrees not to compete

with the Company, solicit employees, vendors or customers for purposes that do not directly benefit the Company or to interfere in any

way with the Company’s relationship with any vendors or customers.

As of February 7, 2022, we entered into an Employment

Agreement with Mr.

DiRubio to serve as Senior Vice President of Sales and Marketing of Precision Optics Corporation.

The agreement covers

a period of one year from January 1, 2022, subject to automatic annual renewals unless earlier terminated or unless either party gives

at least 30 days’ notice of nonrenewal.

DiRubio will receive base salary of $190,000 per year, plus formulaic cash bonuses based

on specified financial results versus budget.

For the period January 1 through June 30, 2022, Mr.

DiRubio earned a revenue-based bonus

of $22,670 and gross margin-based bonus of $6,594.

For the fiscal year ending June 30, 2023, his maximum aggregate cash bonus would be

$125,000, subject to meeting or exceeding targeted financial result targets for the year.

Under his Agreement, Mr.

DiRubio also received

a one-time stock option award for the purchase of up to 100,000 shares of Company common stock at an exercise price of $2.09 per share,

to vest in pro rata increments on February 7, 2023, 2024 and 2025.

DiRubio is terminated without cause by the Company during the

first year of the agreement, he shall receive a lump-sum $47,500 cash severance payment and all unexercised stock options shall vest immediately

and be exercisable for the remainder of their term.

DiRubio is terminated without cause subsequent to the first year of the Agreement,

he shall receive a lump-sum cash severance payment equal to one-fourth his then current annual salary (not including bonus).

The agreement

also provides that during the term of his employment and for twelve months thereafter, Mr.

DiRubio agrees not to compete with the Company,

solicit employees, vendors or customers for purposes that do not directly benefit the Company or to interfere in any way with the Company’s

relationship with any vendors or customers.

Apart from the agreements described above, we

2 unchanged sentences

or other termination of employment with us and our subsidiaries, or as a result of a change-in-control of our Company or a change in the

Named Executive Officers’

responsibilities following a change-in-control.

Named Executive Officers’ responsibilities following a change-in-control.

Outstanding Equity Awards at Fiscal Year-End Table for the Fiscal

7 unchanged sentences

options Unexercisable

Divaker Mangadu

The options were granted on June 4, 2021 with vesting of one-half of the options on the grant date and one-half on June 4, 2022, subject to the holders’

eligibility under the Equity Incentive Plan on that date.

Jeffrey DiRubio

Profit Sharing and 401(k) Plan

21 unchanged sentences

Woodward serves as our Chairman and performs various management services.

In March 2019 the Company’s board of directors approved the payment of $10,000 per quarter to Mr.

Woodward for the performance of certain management services.

In December 2019 the Company’s board of directors approved annual grants of common stock options each year beginning in December 2019 of 20,000 and 30,000 options to each non-management board members and the Chairman, respectively.

On November 16, 2020, 20,000 options to purchase the Company’s common stock were granted to Mr.

Moclot and Dr.

Miles and 30,000 to Mr.

On November 17, 2021, 20,000 options to purchase the Company’s common stock were granted to Mr.

Miles, and Mr.

Anania, and 30,000 to Mr.

Woodward at an exercise price of $2.26 per share.

2 unchanged sentences

stock options were held by each of our directors:

Miclot –

Miles –

Miclot – 120,000, Dr.

Miles – 126,000, Peter V.

– 20,000, Peter H.

Woodward – 180,000.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL

22 unchanged sentences

Name and Address of Beneficial Owner

Shares –

Sandra F., Norman H.

51 st Street PH 31

New York, NY 10022

Dolphin Offshore Partners LP (4)

1 unchanged sentence

Fernandina, FL 32034

Stuart L Sternberg (4)

85 Bellevue Ave

Rye, NY 10580

and Norman H.

500 Fifth Avenue, Suite 2240

New York, NY 10110

Hershey Strategic Capital, LP (5)

1 unchanged sentence

New York, New York 10019

Stuart L Sternberg (6)

85 Bellevue Ave

Rye, NY 10580

MHW Partners, L.P.

5 unchanged sentences

As of September 20, 2022, there were 16,915,089 issued shares of our common stock issued and outstanding.

Percentages are calculated on the basis of the amount of issued and outstanding common stock plus, for each person or group, any securities that such person or group has the right to acquire within 60 days pursuant to options, warrants, conversion privileges or other rights.

We relied, in part, on the Schedule

13D/A filed jointly by Dolphin Offshore Partners, L.P., Dolphin Mgmt.

Percentages are calculated on the basis of the amount of issued and outstanding common stock plus, for each person or group, any securities

that such person or group has the right to acquire within 60 days pursuant to options, warrants, conversion privileges or other rights.

We relied, in part, on a Schedule 13D/A filed jointly with the SEC on July 5, 2019 by Sandra F.

Pessin and Norman H.

Pessin are married and considered to beneficially hold each other’s shares.

Pessin owns 963,334 shares and Mr.

owns 233,625 shares for a combined beneficial ownership of 1,196,959 shares.

We relied, in part, on the Schedule 13D/A filed jointly by Dolphin Offshore Partners, L.P., Dolphin Mgmt.

Services, Inc.

Salas on December 27, 2017 for this

Dolphin Offshore Partners, L.P., a Delaware

limited partnership, is an investment manager.

Salas on December 27, 2017 for this information.

Dolphin Offshore Partners, L.P., a Delaware limited partnership, is an investment manager.

Dolphin Mgmt.

Services, Inc., a Delaware corporation, is the managing general partner of

Dolphin Offshore Partners, L.P.

Salas is the President, sole shareholder and controlling person of Dolphin Mgmt.

Services, Inc., a Delaware corporation,

is the managing general partner of Dolphin Offshore Partners, L.P.

Salas is the President, sole shareholder and controlling

person of Dolphin Mgmt.

Services, Inc.

2 unchanged sentences

Services, Inc.

Salas each may be deemed to beneficially own an aggregate of 2,070,625 shares of common stock.

Salas each may be deemed to beneficially own an aggregate

of 2,070,625 shares of common stock.

Dolphin Offshore Partners, L.P., Dolphin Mgmt.

Services, Inc.

Salas each may be deemed to have shared power to vote or direct the vote, and dispose or direct the disposition, of all such shares of common stock.

We relied, in part, on a Schedule 13G/A filed with the SEC by Stuart Sternberg on February 26, 2021, for this information.

We relied, in part, on a Schedule 13D/A filed jointly with the SEC on July 5, 2019 by Sandra F.

Pessin and Norman H.

Pessin are married and considered to beneficially hold each other’s shares.

Pessin owns 963,334 shares and Mr.

Pessin owns 233,625 shares for a combined beneficial ownership of 1,196,959 shares.

We relied, in part, on the Schedule

13D/A jointly filed by Hershey Strategic Capital, LP, Hershey Management I, LLC and Hershey Strategic Capital GP, LLC on October 10, 2017

for this information.

Hershey Management I, LLC, a Delaware

limited liability company, is the investment advisor of Hershey Strategic Capital, LP, a Delaware limited partnership.

Hershey Strategic

Capital GP, LLC, a Delaware limited liability company, is the general partner of Hershey Strategic Capital, LP.

Adam Hershey is the sole

managing member of both Hershey Management I, LLC and Hershey Strategic Capital GP, LLC.

As the investment advisor, Hershey Management

I, LLC has the voting and dispositive power with respect to all of the shares of common stock owned by Hershey Strategic Capital, LP.

Salas each may be deemed

to have shared power to vote or direct the vote, and dispose or direct the disposition, of all such shares of common stock.

We relied, in part, on the Schedule 13D/A jointly filed by Hershey Strategic Capital, LP, Hershey Management I, LLC and Hershey Strategic

Capital GP, LLC on October 10, 2017 for this information.

Hershey Management I, LLC, a Delaware limited liability company, is the investment advisor of Hershey Strategic Capital, LP, a Delaware

limited partnership.

Hershey Strategic Capital GP, LLC, a Delaware limited liability company, is the general partner of Hershey Strategic

Adam Hershey is the sole managing member of both Hershey Management I, LLC and Hershey Strategic Capital GP, LLC.

investment advisor, Hershey Management I, LLC has the voting and dispositive power with respect to all of the shares of common stock

owned by Hershey Strategic Capital, LP.

On July 9, 2014, Richard E.

Forkey resigned as a director and Hershey Strategic Capital, LP designated Peter H.

Forkey resigned as a director and Hershey Strategic Capital, LP designated

Woodward and Dr.

Schwartz to our Board of Directors and such designees were so appointed.

Hershey Strategic Capital, LP beneficially

owns 986,480 shares of common stock.

Hershey Strategic Capital, LP is managed by Adam Hershey, and in such capacity, Mr.

Hershey holds

the power to vote and direct the disposition of all shares of common stock owned by Hershey Strategic Capital, LP.

Hershey Management

I disclaims beneficial ownership in the shares.

We relied, in part, on a Form 4 filed

with the SEC on December 1, 2016 by Peter H.

Woodward, on a Schedule 13D/A jointly filed with the SEC on November 3, 2015 by MHW Partners,

L.P., MHW Capital, LLC, MHW Capital Management, LLC, on a Form 4 filed with the SEC by Peter H.

Woodward on December 31, 2019, and on

a Form 4 filed with the SEC by Peter H.

Hershey Strategic Capital, LP beneficially owns 986,480 shares of common stock.

Hershey Strategic Capital, LP is managed by Adam Hershey,

and in such capacity, Mr.

Hershey holds the power to vote and direct the disposition of all shares of common stock owned by Hershey Strategic

Hershey Management I disclaims beneficial ownership in the shares.

We relied, in part, on a Schedule 13G/A filed with the SEC by Stuart Sternberg on February 26, 2021, for this information.

We relied, in part, on a Form 4 filed with the SEC on December 1, 2016 by Peter H.

Woodward, on a Schedule 13D/A jointly filed with the

SEC on November 3, 2015 by MHW Partners, L.P., MHW Capital, LLC, and MHW Capital Management, LLC, on a Form 4 filed with the SEC by Peter

Woodward on December 31, 2019, and on a Form 4 filed with the SEC by Peter H.

Woodward on November 16, 2020 for this information.

MHW Partners, L.P.

is a Delaware limited

is a Delaware limited partnership.

MHW Capital, LLC is a Delaware limited liability company.

MHW Capital Management, LLC is a Delaware limited liability company.

MHW Capital Management,

LLC is a Delaware limited liability company.

MHW Capital, LLC is the general partner of MHW Partners, L.P.

Woodward is the principal of MHW Capital Management, LLC and MHW Capital,

LLC and in such capacity, Mr.

Woodward holds the power to vote and direct the disposition of all shares of common stock owned by MHW Partners,

MHW Partners, L.P., MHW Capital, LLC, MHW Capital Management, LLC and Mr.

Woodward share the power to vote and direct the disposition

Woodward is the principal

of MHW Capital Management, LLC and MHW Capital, LLC and in such capacity, Mr.

Woodward holds the power to vote and direct the disposition

of all shares of common stock owned by MHW Partners, L.P.

Woodward is a citizen of the United States and our current Chairman of our

Board of Directors.

MHW Partners, L.P., MHW Capital, LLC, MHW Capital Management, LLC and Mr.

share the power to vote and direct the disposition of all shares of common stock owned by MHW Partners, L.P.

Woodward is a citizen

of the United States and our current Chairman of our Board of Directors.

MHW Partners, L.P.

beneficially owns 674,013 shares of common stock, and 150,000 shares that may be acquired upon the exercise of outstanding stock options by Mr.

beneficially owns 674,013 shares of common stock, and 150,000 shares that may be acquired

upon the exercise of outstanding stock options by Mr.

90,000 options vested in three installments:

one-third vested immediately on the date of grant;

one-third vested immediately

on the date of grant;

one-third vested on May 18, 2016;

the remaining one-third vested on May 18, 2017.

The options have an exercise price of $0.73 and expire on May 18, 2025.

30,000 options became immediately exercisable upon their grant on December 6, 2019, have an exercise price of $1.50 per share, and expire on December 6, 2029.

The remaining 30,000 options became immediately exercisable upon their grant on November 16, 2020, have an exercise price of $1.40 per share, and expire on November 16, 2030.

However, the aggregate number of shares of common stock into which such warrants and options are exercisable, and which MHW Partners, L.P.

has the right to acquire beneficial ownership, is limited to the number of shares of common stock that, together with all other shares of common stock beneficially owned by MHW Partners, L.P., does not exceed 4.999% of the total outstanding shares of common stock.

Accordingly, such warrants and options are not currently exercisable into common stock until the actual shares of common stock held by MHW Partners, L.P.

is less than 4.999% of the total outstanding shares of common stock.

The options have an exercise

price of $0.73 and expire on May 18, 2025.

30,000 options became immediately exercisable upon their grant on December 6, 2019, have an

exercise price of $1.50 per share, and expire on December 6, 2029.

The remaining 30,000 options became immediately exercisable upon their

grant on November 16, 2020, have an exercise price of $1.40 per share, and expire on November 16, 2030.

However, the aggregate number

of shares of common stock into which such warrants and options are exercisable, and which MHW Partners, L.P.

has the right to acquire

beneficial ownership, is limited to the number of shares of common stock that, together with all other shares of common stock beneficially

owned by MHW Partners, L.P., does not exceed 4.999% of the total outstanding shares of common stock.

Accordingly, such warrants and options

are not currently exercisable into common stock until the actual shares of common stock held by MHW Partners, L.P.

is less than 4.999%

of the total outstanding shares of common stock.

MHW Partners, L.P.

may waive this 4.999% restriction with 61 days’

notice to us.

may waive this 4.999% restriction with 61 days’ notice to us.

Officers and Directors

2 unchanged sentences

Nature of beneficial ownership

Shares –

Chief Executive Officer, President, Treasurer and Director

Shares – Rights

Chairman of the Board of Directors

Chief Executive Officer, President, Treasurer and Director

Jeffrey DiRubio (7)

Senior Vice President Sales and Marketing

Habhegger (8)

Chief Financial Officer, Secretary

Divaker Mangadu (9)

President, Ross Optical Division

All directors and executive officers as a group

4 unchanged sentences

Represents shares with respect to which each beneficial owner listed has or will have, upon acquisition of such shares upon exercise or conversion of options, warrants, conversion privileges or other rights exercisable within 60 sixty days, sole voting and investment power.

As of September 20, 2021, we had 13,282,476 shares of our common stock issued and outstanding.

Percentages are calculated on the basis of the amount of issued and outstanding common stock plus, for each person or group, any securities that such person or group has the right to acquire within 60 days of September 20, 2021 pursuant to options, warrants, conversion privileges or other rights.

Forkey is a member of our Board of Directors and serves as our Chief Executive Officer, President and Treasurer.

Forkey’s beneficial ownership consists of (a) 333,620 shares of common stock held in joint ownership with his wife, Heather Forkey, with whom he shares voting and dispositive control, and (b) 650,000 shares of common stock that may be acquired upon the exercise of outstanding stock options.

As of September 27, 2022, we had 16,915,089 shares of our common stock

issued and outstanding.

Percentages are calculated on the basis of the amount of issued and outstanding common stock plus, for each person

or group, any securities that such person or group has the right to acquire within 60 days of September 27, 2022 pursuant to options,

warrants, conversion privileges or other rights.

Anania was appointed to our board of directors on October 6, 2021.

Anania’s beneficial ownership consists of 590,465 shares owned by him, 25,856 shares owned by his wife and 20,000 shares of

common stock that may be acquired by him upon the exercise of outstanding stock options.

Anania is the President of Anania & Associates

Investment Company, LLC.

As part of its acquisition of Lighthouse Imaging, the Company on of October 6, 2021 issued 1,680,145 shares of

common stock to Anania & Associates Investment Company, LLC, designated as nominee holder for all underlying owners of Lighthouse

Imaging, LLC.

The Company later filed a registration statement for resale of those shares, and on September 7, 2022, Anania & Associates

Investment Company, LLC distributed all of the shares to the underlying owners.

Through such distribution, Mr.

Anania acquired

record ownership of the shares shown here as owned by them.

Peter Woodward is the Chairman of our Board of Directors.

Woodward is the managing member and general partner of MHW Partners and in such capacity, Mr.

Woodward holds the power to vote and direct the disposition of all shares of common stock owned by MHW Partners.

On September 28, 2012, MHW Partners purchased 222,223 shares of our common stock, and warrants to purchase up to 168,386 shares of our common stock at an exercise price of $1.11 per share, subject to adjustment and a call provision if certain market price targets are reached, and an expiration date of September 28, 2017.

On July 2, 2014, MHW Partners purchased 125,000 shares of common stock.

is the managing member and general partner of MHW Partners, L.P.

and in such capacity, Mr.

Woodward holds the power to vote and direct

the disposition of all shares of common stock owned by MHW Partners.

On September 28, 2012, MHW Partners purchased 222,223 shares of our

common stock, and warrants to purchase up to 168,386 shares of our common stock at an exercise price of $1.11 per share, subject to adjustment

and a call provision if certain market price targets were reached, and an expiration date of September 28, 2017.

On July 2, 2014, MHW

Partners purchased 125,000 shares of common stock.

On October 19, 2015, MHW Partners purchased 100,000 shares of common stock.

On November 22, 2016 MHW Partners purchased 156,667 shares of common stock, and warrants to purchase 78,333 shares of common stock at an exercise at a variable exercise price subject to the Companies achievement of certain performance criteria.

Woodward exercised the 78,333 November 22, 2016 warrants on October 16, 2017 at $0.01 per share.

Woodward’s beneficial ownership consists of (a) 674,013 shares of common stock held through MHW Partners, L.P., and (b) 150,000 shares of common stock which may be acquired upon the exercise of outstanding stock options.

22, 2016 MHW Partners purchased 156,667 shares of common stock, and warrants to purchase 78,333 shares of common stock at an exercise

at a variable exercise price subject to the Companies achievement of certain performance criteria.

MHW Partners exercised the 78,333 November

22, 2016 warrants on October 16, 2017 at $0.01 per share.

Woodward’s beneficial ownership consists of (a) 674,013 shares of

common stock held through MHW Partners and (b) 180,000 shares of common stock which may be acquired upon the exercise of outstanding stock options.

Forkey is a member of our Board of Directors and serves as our Chief Executive Officer, President and Treasurer.

Forkey’s beneficial ownership consists of (a) 347,620 shares of common stock held in joint ownership with his wife, Heather Forkey, with whom he shares voting and dispositive control, and (b) 500,000 shares of common stock that may be acquired upon the exercise of outstanding stock options.

DiRubio is our Senior Vice President of Sales

and Marketing.

Dirubio’s beneficial ownership consists of (a) 196,000 shares of common, and (b) 125,000 shares of common stock

that may be acquired upon the exercise of outstanding stock options.

Habhegger is our Chief Financial Officer and Secretary effective December 1, 2019.

Habhegger’s beneficial ownership consists of (a) 9,095 shares of common stock and (b) 180,000 shares of common stock that may be acquired upon the exercise of outstanding stock options.

Miles is a member of our Board of Directors.

beneficial ownership consists of (a) 15,112 shares of common stock, and (b) 113,600 shares of common stock that may be acquired upon the exercise of outstanding stock options.

Miles’ beneficial ownership consists of (a) 22,712 shares of common stock, and (b) 126,000 shares of common stock that may be acquired upon the exercise of outstanding stock options.

Andrew Miclot is a member of our Board of Directors.

Miclot’s beneficial ownership consists of 100,000 shares that may be acquired upon the exercise of outstanding stock options.

Habhegger became our Chief Financial Officer and Secretary effective December 1, 2019.

Habhegger’s beneficial ownership consists of 180,000 shares of common stock that may be acquired upon the exercise of outstanding stock options.

Mangadu became our President, Ross Optical Division upon our acquisition of Ross Optical, Inc.

effective July 1, 2019.

Mangadu’s beneficial ownership consists of 125,000 shares of common stock that may be acquired upon the exercise of outstanding stock options.

CERTAIN RELATIONSHIPS

AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Miclot’s beneficial ownership consists of 120,000 shares that may be acquired upon the exercise of outstanding stock options.

RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Certain Relationships and Related Transactions

1 unchanged sentence

June 30, 2022 we had the following related party transactions.

At June 30, 2019, we had received payments for

common stock subscriptions totaling $925,000 at $1.25 per share.

On July 1, 2019 we received an additional $25,000 and closed the private

placement on that date by issuing 760,000 unregistered common shares.

The placement proceeds were used to partially fund the business

acquisition of the Ross Optical division.

In compliance with the registration rights agreement entered into with the investors, on October

29, 2019 we filed a registration statement for the shares with the Securities and Exchange Commission which became effective on November

Sandra Pessin acquired 200,000 shares in this placement for $250,000 or $1.25 per share, and at that time Ms.

an owner of more than 5% of our outstanding common stock.

On April 14, 2020 we sold 200,000 shares of common

stock for cash at $1.25 per share or $250,000 to be used for general working capital needs.

In compliance with the registration rights

agreement entered into with the investors, on August 14, 2020 we filed a registration statement for the shares with the Securities and

Exchange Commission which became effective on November 4, 2020.

Hershey Strategic Capital, LP acquired 20,000 shares in this placement

for $25,000 or $1.25 per share, and at that time Hershey Strategic Capital, LP was an owner of more than 5% of our outstanding common

On October 4, 2021, the Company entered into agreements

with accredited investors for the private placement of 937,500 shares of our common stock, $0.01 par value, at a price of $1.60 per share.

We received $1,500,000 in gross proceeds from the offering.

The placement proceeds were used to partially

fund the business acquisition of the Lighthouse division.

In compliance with the registration rights agreement entered into with the investors,

on January 31, 2022 the Company filed a registration statement for the shares with the Securities and Exchange Commission, which became

effective on February 11, 2022.

Sandra Pessin acquired 468,750 shares in this placement for $750,000 or $1.60 per share;

Pessin was already an owner of more than 5% of the Company’s outstanding common stock.

Director Independence

During the fiscal year ended June 30, 2021,

the Board of Directors determined that Dr.

the Board of Directors determined that Peter H.

Woodward, Dr.

Miles and Andrew J.

Miclot were “independent”

as defined under the

standards of independence set forth in the Nasdaq Listing Rules and the rules under the Securities Exchange Act of 1934.

ACCOUNTING FEES AND SERVICES.

Miclot were “independent” as

defined under the standards of independence set forth in the Nasdaq Listing Rules and the rules under the Securities Exchange Act of 1934.

PRINCIPAL ACCOUNTING

FEES AND SERVICES.

Independent Registered Public Accounting Firm

5 unchanged sentences

Audit Related Fees (2)

Business Acquisition Related Fees (3)

Total Audit and Audit Related Fees

3 unchanged sentences

Audit-related fees are comprised of fees for assurance and related attestation services that are reasonably related to the performance of the audit of our annual financial statements, or the review thereof, and fees for due diligence services.

Business acquisition related fees relate to audit, assurance and related attestation services relating to our acquisition of the Lighthouse division in October 2021.

Tax fees for fiscal 2022 and 2021 are comprised of fees for professional services performed with respect to corporate tax compliance, tax return preparation and filing, tax planning and tax advice.

5 unchanged sentences

of Directors has considered the nature and amount of fees billed by Stowe and believes that the provision of services for activities unrelated

to the audit is compatible with maintaining the firm’s independence.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

Documents filed as part of this

to the audit is compatible with maintaining the firm’s independence.

EXHIBITS, FINANCIAL

STATEMENT SCHEDULES.

Documents filed as part of this report

The following documents are filed as part of this Annual Report on

FINANCIAL STATEMENTS

The following documents are filed in Part II, Item 8 of

this Annual Report on Form 10-K:

Report of Independent Registered Public Accounting Firm

The following documents are filed in Part II, Item 8 of this

Annual Report on Form 10-K:

Report of Independent Registered Public Accounting

Consolidated Balance Sheets at June 30, 2022 and

Consolidated Statements of Operations for the years ended June 30, 2021 and 2020

Consolidated Statements of Stockholders’

Equity for the years ended June 30, 2021 and 2020

Consolidated Statements of Cash Flows for the years ended June 30, 2021 and 2020

Consolidated Statements of Operations for the years

ended June 30, 2022 and 2021

Consolidated Statements of Stockholders’ Equity

for the years ended June 30, 2022 and 2021

Consolidated Statements of Cash Flows for the years ended

June 30, 2022 and 2021

Notes to Consolidated Financial Statements

4 unchanged sentences

in this report.

Purchase Agreement between the Company and Optometrics Corporation, dated January 18, 2008 (included as Exhibit 2.1 to the Form 8-K

filed January 25, 2008 and incorporated herein by reference).

of Organization of Precision Optics Corporation, Inc., as amended (included as Exhibit 3.1 to the Form SB-2 filed March 16, 2007,

and incorporated herein by reference).

of Precision Optics Corporation, Inc.

(included as Exhibit 3.2 to the Form S-1 filed December 18, 2008, and incorporated herein by

of Amendment to the Articles of Organization of Precision Optics Corporation, Inc., dated November 25, 2008 and effective December

11, 2008 (included as Exhibit 3.1 to the Form 8-K filed December 11, 2008, and incorporated herein by reference).

and Restated Bylaws of Precision Optics Corporation, Inc.

(included as Exhibit 3.1 to the Current Report on Form 8-K filed July 11,

2014, and incorporated herein by reference).

Optics Corporation, Inc.

2011 Equity Incentive Plan, dated October 13, 2011 (included as Exhibit 10.2 to Form S-8 filed October 14,

2011, and incorporated herein by reference.)

Optics Corporation, Inc.

Amended 2011 Equity Incentive Plan, dated October 14, 2011, as amended on April 16, 2015 (included as Exhibit

10.1 to the Company’s Registration Statement on Form S-8 filed April 20, 2015, and incorporated herein by reference).

Agreement, by and among Precision Optics Corporation, Inc.

Asset Purchase Agreement between the Company and Optometrics Corporation, dated January 18, 2008 (included as Exhibit 2.1 to the Form 8-K filed January 25, 2008 and incorporated herein by reference).

Articles of Organization of Precision Optics Corporation, Inc., as amended (included as Exhibit 3.1 to the Form SB-2 filed March 16, 2007, and incorporated herein by reference).

Bylaws of Precision Optics Corporation, Inc.

(included as Exhibit 3.2 to the Form S-1 filed December 18, 2008, and incorporated herein by reference).

Articles of Amendment to the Articles of Organization of Precision Optics Corporation, Inc., dated November 25, 2008 and effective December 11, 2008 (included as Exhibit 3.1 to the Form 8-K filed December 11, 2008, and incorporated herein by reference).

Amended and Restated Bylaws of Precision Optics Corporation, Inc.

(included as Exhibit 3.1 to the Current Report on Form 8-K filed July 11, 2014, and incorporated herein by reference).

Amendment to the Amended and Restated Bylaws of Precision Optics Corporation, Inc.

effective May 13, 2022 (included as exhibit 3.5 to the Form 10-Q filed May 16, 2022, and incorporated herein by reference).

Precision Optics Corporation, Inc.

2011 Equity Incentive Plan, dated October 13, 2011 (included as Exhibit 10.2 to Form S-8 filed October 14, 2011, and incorporated herein by reference.)

Precision Optics Corporation, Inc.

Amended 2011 Equity Incentive Plan, dated October 14, 2011, as amended on April 16, 2015 (included as Exhibit 10.1 to the Company’s Registration Statement on Form S-8 filed April 20, 2015, and incorporated herein by reference).

Compensation Agreement, by and among Precision Optics Corporation, Inc.

and Joseph N.

Forkey, dated August 2, 2018 (included as Exhibit 10.1 to

the Company’s Current Report on Form 8-K filed on August 3, 2018, and incorporated herein by reference).

10.4&dagger;+

Purchase Agreement dated July 1, 2019, between Precision Optics Corporation, Inc.

Forkey, dated August 2, 2018 (included as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 3, 2018, and incorporated herein by reference).

Asset Purchase Agreement dated July 1, 2019, between Precision Optics Corporation, Inc.

and Ross Optical Industries, Inc.

and the shareholders

(included as Exhibit 10.1 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

of Purchase Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated July 1, 2019 (included as Exhibit

10.2 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

of Registration Rights Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated July 1, 2019 (included

as Exhibit 10.3 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

Agreement, by and among Precision Optics Corporation.

and Divaker Mangadu, dated July 1, 2019 (included as Exhibit 10.4 to the

Form 8-K filed on July 8, 2019, and incorporated herein by reference).

agreement, by and among Precision Optics Corporation, Inc.

and Jeff DiRubio, dated April 26, 2019 (included as Exhibit 10.16 to the

annual report on Form 10-K filed on September 26, 2019, and incorporated herein by reference).

Agreement, by and among Precision Optics Corporation, Inc.

and the shareholders (included as Exhibit 10.1 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

Form of Purchase Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated July 1, 2019 (included as Exhibit 10.2 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

Form of Registration Rights Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated July 1, 2019 (included as Exhibit 10.3 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

Employment Agreement, by and among Precision Optics Corporation.

and Divaker Mangadu, dated July 1, 2019 (included as Exhibit 10.4 to the Form 8-K filed on July 8, 2019, and incorporated herein by reference).

Employment agreement, by and among Precision Optics Corporation, Inc.

and Jeff DiRubio, dated April 26, 2019 (included as Exhibit 10.16 to the annual report on Form 10-K filed on September 26, 2019, and incorporated herein by reference).

Lease Agreement, by and among Precision Optics Corporation, Inc.

and Texzona Industries Ltd.

dated July 1, 2019 (included as Exhibit 10.17

to the annual report on Form 10-K filed on September 26, 2019, and incorporated herein by reference).

Offer Letter Daniel S.

Habhegger, dated December 2, 2019 (included as Exhibit 10.18 to the quarterly report on Form 10-Q filed on

February 13, 2020, and incorporated herein by reference).

of Securities Purchase Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated April 14, 2020 (included

as Exhibit 10.1 to the current report on Form 8-K filed on May 7, 2020, and incorporated herein by reference).

of Registration Rights Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated April 14, 2020 (included

as Exhibit 10.2 to the current report on Form 8-K filed on May 7, 2020, and incorporated herein by reference).

Optics Corporation, Inc.

Corporate Code of Ethics and Conduct (included as Exhibit 14.1 to the Form 10-K filed September 28, 2008,

and incorporated herein by reference).

of the Registrant (included as Exhibit 21.1 to the Form 10-K filed September 26, 2008, and incorporated herein by reference).

dated July 1, 2019 (included as Exhibit 10.17 to the annual report on Form 10-K filed on September 26, 2019, and incorporated herein by reference).

Employment Offer Letter Daniel S.

Habhegger, dated December 2, 2019 (included as Exhibit 10.18 to the quarterly report on Form 10-Q filed on February 13, 2020, and incorporated herein by reference).

Form of Securities Purchase Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated April 14, 2020 (included as Exhibit 10.1 to the current report on Form 8-K filed on May 7, 2020, and incorporated herein by reference).

Form of Registration Rights Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated April 14, 2020 (included as Exhibit 10.2 to the current report on Form 8-K filed on May 7, 2020, and incorporated herein by reference).

Asset Purchase Agreement, dated October 4, 2021, by and among Precision Optics Corporation, Inc.

and Lighthouse Imaging, LLC and Anania & Associates Investment Company, LLC (included as Exhibit 10.1 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference).

Form of Securities Purchase Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated October 4, 2021 (included as Exhibit 10.2 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference) .

Form of Registration Rights Agreement, by and among Precision Optics Corporation, Inc.

and several Investors, dated October 4, 2021 (included as Exhibit 10.3 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference) .

Loan Agreement dated October 4, 2021, by and among Precision Optics Corporation, Inc.

and Main Street Bank (included as Exhibit 10.4 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference).

$250,000 Revolving Line of Credit Note dated October 4, 2021 (included as Exhibit 10.5 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference) .

$2,600,000 Term Loan Note dated October 4, 2021 (included as Exhibit 10.6 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference).

Security Agreement dated October 4, 2021, by and among Precision Optics Corporation, Inc.

and Main Street Bank (included as Exhibit 10.7 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference).

Director side letter agreement dated October 4, 2021 (included as Exhibit 10.8 to the current report on Form 8-K filed on October 8, 2021, and incorporated herein by reference).

Precision Optics Corporation, Inc.

2022 Equity Incentive Plan (included as Appendix B to the proxy statement on Form DEF14A filed on February 24, 2022, and incorporated herein by reference) .

Precision Optics Corporation, Inc.

Corporate Code of Ethics and Conduct (included as Exhibit 14.1 to the Form 10-K filed September 28, 2008, and incorporated herein by reference).

Subsidiaries of the Registrant (included as Exhibit 21.1 to the Form 10-K filed September 26, 2008, and incorporated herein by reference).

Consent of Independent Registered Public Accounting Firm.

3 unchanged sentences

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 .

XBRL Instance

XBRL Taxonomy Extension Schema

XBRL Taxonomy Extension Calculation Linkbase

XBRL Taxonomy Extension Definition Linkbase

XBRL Taxonomy Extension Label Linkbase

XBRL Taxonomy Extension Presentation Linkbase

Inline XBRL Instance Document ( the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Cover Page Interactive Data File (embedded within the Inline XBRL document)

Filed herewith.

31 unchanged sentences

September 27, 2022

/s/ Andrew J.

September 27, 2022

Director, Chairman

/s/ Andrew J.

September 27, 2022

1 unchanged sentence

September 27, 2022

Director, Chairman

September 27, 2022

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 9A. Controls and Procedures