Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES.
Management’s Evaluation of Disclosure Controls and Procedures
Our Chief Executive Officer and our Chief Financial
Officer evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report
on Form 10-K. Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure
controls and procedures were effective as of June 30, 2026.
Management’s Annual Report on Internal
Control Over Financial Reporting
Our disclosure controls and procedures include
components of our internal control over financial reporting. In designing and evaluating our disclosure controls and procedures, management
recognizes that any controls, no matter how well designed and operated, can provide only reasonable, but not absolute, assurance that
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
detected.
Under the supervision and with the participation
of our management, including our Chief Executive Officer and our Chief Financial Officer, we conducted an assessment of the effectiveness
of our internal control over financial reporting as of June 30, 2026. 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
(2013). Based on our evaluation, our management concluded that our internal control over financial reporting was effective as of June
30, 2026.
Changes in Internal Control over Financial
Reporting
There has been no change in our internal control
over financial reporting that occurred during the 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.
ITEM 9B. OTHER INFORMATION.
During the three months ended June 30, 2026, no
director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading
arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
Our loan agreement contains a minimum annual debt
service coverage ratio covenant of 1.2x, for the period ending June 30, 2026. We did not meet this annual debt service coverage ratio
as of June 30, 2026. Our lender has agreed to waive compliance with the debt service ratio covenant for the period ending June 30, 2026.
In addition to the waiver, we have entered into amendments with our lender and modified the Company’s credit arrangements to eliminate
the debt service coverage ratio covenant and replace it with a minimum liquidity covenant of $2.0 million, retain the existing term note,
and provide the Company access to $750,000 of availability under its revolving line of credit, subject to borrowing-base requirements
and a $5,000 waiver fee. The lender further agreed to expand availability under the revolving line of credit to $1,250,000 upon attaining
a DSCR of 1.2x.
ITEM 9C. DISC LOSURE
REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.
Not applicable.
23
PART III
ITEM 10. DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
The information required under this item is incorporated
by reference to the applicable information set forth in the Proxy Statement for the 2026 Annual Meeting of Stockholders.
Our Board of Directors has adopted a written Code
of Business Conduct and Ethics applicable to all officers, directors and employees, which has been filed as an exhibit to this Annual
Report.
ITEM 11. EXECUTIVE
COMPENSATION.
The information required under this item is incorporated
by reference to the applicable information set forth in the Proxy Statement for the 2026 Annual Meeting of Stockholders.
ITEM 12. SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The information required under this item is incorporated
by reference to the applicable information set forth in the Proxy Statement for the 2026 Annual Meeting of Stockholders.
ITEM 13. CERTAIN RELATIONSHIPS
AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
The information required under this item is incorporated
by reference to the applicable information set forth in the Proxy Statement for the 2026 Annual Meeting of Stockholders.
ITEM 14. PRINCIPAL
ACCOUNTING FEES AND SERVICES.
The information required under this item is incorporated
by reference to the applicable information set forth in the Proxy Statement for the 2026 Annual Meeting of Stockholders.
24
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
a.
Documents filed as part of this report
The following documents are filed as part of this Annual Report
on 10-K:
1.
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
Balance Sheets at June 30, 2026 and 2025
Statements of Operations for the years ended June 30, 2026 and 2025
Statements of Stockholders’ Equity for the years ended June 30, 2026 and 2025
Statements of Cash Flows for the years ended June 30, 2026 and 2025
Notes to Financial Statements
2.
FINANCIAL STATEMENT SCHEDULES
All financial statement schedules have been omitted
as they are not required, not applicable, or the required information is otherwise included.
b.
Exhibits
The exhibits listed below are filed with or incorporated by reference
in this report.
Exhibit
Description
3.1
Restated Articles of Organization of Precision Optics Corporation, Inc. (included as Exhibit 3.1 to the Form 10-K filed September 28, 2023, and incorporated herein by reference).
3.2
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).
3.3
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).
3.4
Articles of Amendment to the Amended Articles of Organization as filed with the Commonwealth of Massachusetts on October 24, 2022; and Articles of Amendment as filed with the Commonwealth of Massachusetts on October 26, 2022, to override the earlier amendment (included as Exhibit 3.1 to the Current Report on Form 8-K filed November 2, 2022, and incorporated herein by reference).
3.5
Articles of Amendment to the Amended Articles of Organization as filed with the Commonwealth of Massachusetts on October 27, 2022, to set revised effective date of reverse stock split (included as Exhibit 3.2 to the Current Report on Form 8-K filed November 2, 2022, and incorporated herein by reference).
4.1
Form of Common Stock Certificate (incorporated by reference from Exhibit 4.1 to the annual report on Form 10-K filed on September 30, 2024).
4.2
Description of Securities (incorporated by reference from Exhibit 4.2 to the annual report on Form 10-K filed on September 30, 2024)
25
Exhibit
Description
10.1
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.)
10.2
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).
10.3
Compensation Agreement, by and between the Company and Joseph N. Forkey, dated August 2, 2018 (included as Exhibit 10.1 to the Form 8-K filed on August 3, 2018, and incorporated herein by reference).
10.4
Employment Agreement, by and among Precision Optics Corporation. Inc. 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).
10.5†
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).
10.6+
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).
10.7†+
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).
10.8+
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).
10.9
$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).
10.10
$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).
10.11
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).
26
Exhibit
Description
10.12
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).
10.13
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).
10.14
Second Amendment to Loan Agreement dated June 2, 2023, by and between Precision Optics Corporation, Inc. and Main Street Bank (included as Exhibit 10.1 to the current report on Form 8-K filed on June 7, 2023, and incorporated herein by reference).
10.15
$750,000 Promissory Note dated June 2, 2023 (included as Exhibit 10.2 to the current report on Form 8-K filed on June 7, 2023, and incorporated herein by reference).
10.16
Second Amendment to Demand Revolving Line of Credit Note dated June 2, 2023, by and between Precision Optics Corporation, Inc. and Main Street Bank (included as Exhibit 10.3 to the current report on Form 8-K filed on June 7, 2023, and incorporated herein by reference).
10.17
Employment Agreement dated March 30, 2023 between Precision Optics Corporation, Inc. and Mahesh Lawande (included as Exhibit 10.31 to the Form S-1 filed July 20, 2023, and incorporated herein by reference).
10.18
Employment Agreement dated June 7, 2023 between Precision Optics Corporation, Inc. and Wayne M. Coll (included as Exhibit 10.31 to the Form S-1 filed July 20, 2023, and incorporated herein by reference).
10.19
Modification to Employment Agreement by and between Precision Optics Corporation, Inc. and Jeffrey L. DiRubio dated June 29, 2024 (included as Exhibit 10.1 to the current report on Form 8-K filed on July 3, 2024, and incorporated herein by reference).
10.20
Consulting Agreement by and between Precision Optics Corporation, Inc. and Jeffrey L. DiRubio dated June 29, 2024 (included as Exhibit 10.2 to the current report on Form 8-K filed on July 3, 2024, and incorporated herein by reference).
10.21
Modification and Amendment of Term Note dated September 30, 2024 by and between Precision Optics Corporation, Inc. and Main Street Bank (incorporated by reference from Exhibit 10.30 to the annual report on Form 10-K filed on September 30, 2024)
27
Exhibit
Description
10.22
Modification and Amendment of Promissory Note dated September 30, 2024 by and between Precision Optics Corporation, Inc. and Main Street Bank (incorporated by reference from Exhibit 10.31 to the annual report on Form 10-K filed on September 30, 2024)
10.23
Waiver Letter from Main Street Bank dated February 14, 2025 (incorporated by reference from Exhibit 10.2 to the current report on Form 8-K filed on February 20, 2025)
10.24
First Lease Extension Agreement, dated May 13, 2025, by and between Texzona Industries, Inc and Precision Optics Corporation, Inc. (incorporated by reference from Exhibit 10.1 to the current report on Form 8-K filed on May 19, 2025)
10.25
Lease, dated May 14, 2025, by and between 400 Southborough, LLC and Precision Optics Corporation, Inc. (incorporated by reference from Exhibit 10.1 to the current report on Form 8-K filed on May 20, 2025)
10.26
Modification Agreement dated October 2, 2025 by and between Precision Optics Corporation, Inc. and Mahesh Lawande. (incorporated by reference from Exhibit 10.1 to the current report on Form 8-K filed on October 3, 2025)
10.27
Employment Agreement dated September 29, 2025 by and between Precision Optics Corporation, Inc. and Joseph W. Traut (incorporated by reference from Exhibit 10.2 to the current report on Form 8-K filed on October 3, 2025)
10.28
Non-Competition Agreement dated September 29, 2025 by and between Precision Optics Corporation, Inc. and Joseph W. Traut (incorporated by reference from Exhibit 10.3 to the current report on Form 8-K filed on October 3, 2025)
10.29
Stock Option Agreement made effective as of October 1, 2025 by and between Precision Optics Corporation, Inc. and Joseph Traut (incorporated by reference from Exhibit 10.4 to the Form 10-Q filed on November 13, 2025)
10.30
Precision Optics Corporation, Inc. 2022 Equity Incentive Plan (incorporated by reference from Exhibit 10.1 to the Form S-8 filed on December 3, 2025)
10.31
Underwriting Agreement, dated March 27, 2026, between Precision Optics Corporation, Inc. and Lucid Capital Markets, LLC (incorporated by reference from Exhibit 1.1 to the current
report on Form 8-K filed on March 30, 2026)
10.32
Form of Representative Warrant (incorporated by reference from Exhibit 4.1 to the current report on Form 8-K filed on March 30, 2026)
10.33*
Third Amendment to Loan Agreement dated September 25, 2026, by and between Precision Optics Corporation, Inc. and Main Street Bank
10.34*
Waiver Letter from Main Street Bank dated September 25, 2026
14.1
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).
19.1
Insider Trading Policy (incorporated by reference from Exhibit 19.1 to the annual report on Form 10-K filed on September 30, 2024)
28
Exhibit
Description
23.1*
Consent of Independent Registered Public Accounting Firm.
31.1*
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*
Certification of Officers pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
97.1
Precision Optics, Corporation, Inc. Restatement Recoupment Policy (incorporated by reference from Exhibit 97.1 to the annual report on Form 10-K filed on September 30, 2024)
101.INS*
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)
101.SCH*
Inline XBRL Taxonomy Extension Schema Document
101.CAL*
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*
Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*
Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*
Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*
Cover Page Interactive Data File (embedded within the Inline XBRL document)
*
Filed Herewith.
†
Certain portions of the agreement have been omitted to preserve the confidentiality of such information. The Company will furnish copies of any such information to the SEC upon request.
+
The schedules to agreement have been omitted from this filing pursuant to Item 601(a)(5) of Regulation S-K. The Company will furnish copies of any such schedules to the SEC upon request.
Copies of above exhibits not contained herein are
available to any stockholder, upon written request to: Chief Financial Officer, Precision Optics Corporation, Inc., 550 King Street, Bldg.
A, Ste. 100, Littleton, Massachusetts 01460-6245.
ITEM 16. FORM 10-K SUMMARY.
None.
29
SIGNATURES
Pursuant to the requirements of Section 13
or 15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
PRECISION OPTICS CORPORATION, INC.
Date: September 28, 2026
By:
/s/ Joseph N. Forkey
Joseph N. Forkey
President and Chief Executive Officer
(Principal Executive Officer)
Date: September 28, 2026
By:
/s/ Wayne M. Coll
Wayne M. Coll
Chief Financial Officer
(Principal Financial Officer and Principal Accounting 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
on the dates indicated.
Signature
Capacity
Date
/s/ Joseph N. Forkey
Joseph N. Forkey
Chief Executive Officer, President, Treasurer and Director
(Principal Executive Officer)
September 28, 2026
/s/ Wayne M. Coll
Wayne M. Coll
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
September 28, 2026
/s/ Buell V. Duncan
Director
September 28, 2026
Buell V. Duncan
/s/ Andrew J. Miclot
Director
September 28, 2026
Andrew J. Miclot
/s/ Joseph P. Pellegrino
Director
September 28, 2026
Joseph P. Pellegrino
/s/ Peter H. Woodward
Director, Chairman
September 28, 2026
Peter H. Woodward
30