SONO TEK CORP 10-K

ITEM 9A CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Act”)) 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 Chief Financial Officer concluded that these disclosure controls and procedures were effective as of such date, at a reasonable level of assurance, in ensuring that the information required to be disclosed by us in the reports we file or submit under the Act is (i) accumulated and communicated to our management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Internal Control Over Financial Reporting Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal accounting officer), we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the criteria in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation, management has concluded that our internal control over financial reporting was effective as of and for the year ended February 28, 2026. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 31 Changes in Internal Control Over Financial Reporting There was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B OTHER INFORMATION - None . ITEM 9C DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS. – Not Applicable. 32 PART III ITEM 10 DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE Identification of Directors Name Age Position with the Company Christopher L. Coccio, Ph.D. 85 Executive Chairman and Director R. Stephen Harshbarger 58 Chief Executive Officer, President and Director Eric Haskell, CPA 79 Director* Adeniyi Lawal, Ph.D. 69 Director Carol O’Donnell 69 Director* Joseph Riemer, Ph.D. 77 Director Kirk Warshaw, CPA 68 Director* *Member of the Audit Committee. Our Board of Directors is divided into two classes. The directors in each class serve for a term of two years. The terms of the classes are staggered so that only one class of directors is elected at each annual meeting of our shareholders. The terms of Mr. Haskell, Dr. Lawal and Ms. O’Donnell run until the annual meeting to be held in 2026, and in each case until their respective successors are duly elected and qualified. The terms of Drs. Coccio and Riemer and Messrs. Harshbarger and Warshaw run until the annual meeting to be held in 2027. Audit Committee We have a separate designated standing Audit Committee established and administered in accordance with SEC rules. The three members of the Audit Committee are Eric Haskell, CPA (who serves as Chairman of the Audit Committee), Carol O’Donnell and Kirk Warshaw, CPA. The Board of Directors has determined that each member of the Audit Committee meets the independence criteria prescribed by NASDAQ governing the qualifications for audit committee members and each Audit Committee member meets NASDAQ’s financial knowledge requirements. The Board of Directors has determined that Mr. Haskell qualifies as an “audit committee financial expert,” as defined in the rules and regulations of the SEC. The Audit Committee is responsible for (i) selecting an independent public accountant for ratification by the stockholders, (ii) reviewing material accounting items affecting the consolidated financial statements of the Company, and (iii) reporting its findings to the Board of Directors. Compensation Committee The Company’s executive compensation is administered by the Compensation Committee of the Board of Directors. The members of the Compensation Committee are Carol O’Donnell (who serves as Chairperson of the Compensation Committee), Dr. Lawal and Mr. Haskell, whom have been determined by the Board to be independent in accordance with NASDAQ’s requirement for independent director oversight of executive officer compensation. Nominating Committee There have been no changes to the procedures by which shareholders may recommend nominees to the Board of Directors. Family Relationships There are no family relationships between any of our directors and officers. 33 Identification of Executive Officers Name Age Position with the Company Stephen J. Bagley, CPA 63 Chief Financial Officer Christopher C. Cichetti 44 Chief Operating Officer Christopher L. Coccio, Ph.D. 85 Executive Chairman and Director R. Stephen Harshbarger 58 Chief Executive Officer, President and Director Maria T. Kuha 49 Vice President – Manufacturing Operations The foregoing officers are appointed for terms of one year or until their successors are duly appointed and qualified or until terminated by action of the Board of Directors. There are no arrangements or understandings between any executive officer and any other persons pursuant to which he was or is to be selected as an officer. Business Experience STEPHEN J. BAGLEY, CPA was appointed Chief Financial Officer of the Company in June 2005. From 1987 to 1991 he worked in public accounting in various capacities. From 1992 to 2005, he held various leadership positions as Controller, Chief Financial Officer and Vice President of Finance for companies with up to $45,000,000 in revenues. Mr. Bagley earned a Bachelor of Science degree from The State University of NY at Oneonta and an MBA from Marist University. He was licensed as a CPA in 1990. Mr. Bagley served on the OTCQX US Advisory Council from 2019 to 2020. Mr. Bagley is a past President of the Board of Education for the New Paltz Central School District and a past Chairman of the Audit and Finance Committee for the District. CHRISTOPHER C. CICHETTI was appointed Chief Operating Officer in March 2025. From August 2022 until March 2025, Mr. Cichetti served as Vice President – Sales and Application Engineering of the Company. Mr. Cichetti joined Sono-Tek in 2005 as an Electrical Engineer and has served as Application Engineer, Senior Application Engineer, Application Engineering Manager, and Vice President of Application Engineering. Mr. Cichetti has experience in lab testing, process development, project management, and has successfully implemented several successful OEM relationships with outside vendors. He is a graduate of Worcester Polytechnic Institute with a major in Computer and Electrical Engineering and a minor in International Studies. DR. CHRISTOPHER L. COCCIO has served as Executive Chairman of the Company since January 2024. Prior thereto, Dr. Coccio served as Sono-Tek’s Chief Executive Officer from April 2001 until January 2024. Dr. Coccio has been a Director of the Company since June 1998 and became Chairman of the Board of Directors in August 2007. From 1964 to 1996, he held various engineering, sales, marketing and management positions at General Electric Company, with P&L responsibilities for up to $100 million in sales and 500 people throughout the United States. He also won an ASME Congressional Fellowship and served with the Senate Energy Committee in 1976. His business experience includes both domestic and international markets and customers. He founded a management consulting business in 1996 and was appointed a legislative Fellow on the New York State Assembly’s Legislative Commission on Science and Technology from 1996 to 1998. From 1998 to 2001, he worked with Accumetrics Associates, Inc., a manufacturer of digital wireless telemetry systems, as Vice President of Business Development and member of the Board of Advisors. Dr. Coccio received a B.S.M.E. from Stevens Institute of Technology, an M.S.M.E. from the University of Colorado, and a Ph.D. from Rensselaer Polytechnic Institute in Chemical Engineering. Key attributes, Experience and Skills: Dr. Coccio brings his strategic vision for our Company to the Board together with his leadership, business experience and investor relations skills. Dr. Coccio has an immense knowledge of our Company and its related applications which is beneficial to the Board. Dr. Coccio’s service as Executive Chairman bridges a critical gap between the Company’s management and the Board, enabling the Board to benefit from management’s perspective on the Company’s business while the Board performs its oversight function. 34 R. STEPHEN HARSHBARGER has been Chief Executive Officer and President of the Company since January 2024 and a Director since 2013. Mr. Harshbarger originally joined Sono-Tek in 1993 and became President in 2012. Before becoming Chief Executive Officer and President, Mr. Harshbarger honed his expertise through various pivotal roles within Sono-Tek, including Sales Engineer, Worldwide Sales and Marketing Manager, Vice President & Director of Electronics and Advanced Energy (E&AE), and Executive Vice President. Under his stewardship, the sales organization flourished, with a global distribution network spanning over 40 countries and boasting a revenue surge of over 300%. Mr. Harshbarger is a recognized authority in ultrasonic coating equipment, particularly within the electronics, medical device, and advanced energy sectors. Prior to his tenure at Sono-Tek, he played a pivotal role as the Sales and Marketing Manager for Plasmaco Inc., a pioneer in the development of Flat Panel Displays, where he spearheaded the establishment of their distribution network, participated in venture capital funding, and introduced the first flat panels to the Wall Street trading floors. Mr. Harshbarger graduated from Bentley University, with a major in Finance and a minor in Marketing. Key attributes Experience and Skills: Mr. Harshbarger is a pivotal asset to Sono-Tek and its Board. Renowned as one of the foremost ultrasonic coating experts globally, he has a proven successful track record of identifying, developing, and implementing innovative technologies for diverse markets and applications. His adeptness in cultivating robust distribution networks and his deep understanding of ultrasonic coating for new product developments are invaluable assets that drive the Company’s growth and innovation. Moreover, Mr. Harshbarger’s leadership and oversight prowess further enrich the strategic vision of the Board, ensuring that Sono-Tek remains at the forefront of technological advancement and market leadership. ERIC HASKELL, CPA has been a Director since August 2009. He has over 40 years of experience in senior financial positions at several public and private companies. He has significant expertise in the areas of acquisitions and divestitures, strategic planning and investor relations. From December 2005 through March 2008, Mr. Haskell served as the Executive Vice President and Chief Financial Officer of SunCom Wireless Holdings, Inc., a company providing digital wireless communications services which was publicly traded until its merger with a wholly-owned subsidiary of T-Mobile USA, Inc. in February 2008. He also served as a member of SunCom’s Board of Directors from November 2003 through May 2007. From 1989 until April 2004, Mr. Haskell served as the Chief Financial Officer of Systems & Computer Technology Corp., a NASDAQ listed software and services corporation. He has served as Audit Committee Chairman since 2023. Mr. Haskell received a Bachelors Degree in Business Administration from Adelphi University in 1969. Key attributes, Experience and Skills: Mr. Haskell’s training and extensive experience in financial management at both public and private companies provide the Board with valuable insights. Mr. Haskell’s significant experience in acquisitions and divestitures and investor relations bring strategic judgment and experience to the Board. Mr. Haskell’s strong operational and business background complement his accounting and finance experience and are valuable resources to the Board as it exercises its oversight duties and support of the Company’s growth strategies. MARIA T. KUHA joined Sono-Tek in 2007. Mrs. Kuha was appointed VP, Manufacturing Operations, Procurement & Logistics in September 2022. Prior to assuming her present position, Mrs. Kuha served as Operations Director, Purchasing Manager, and several other positions within the procurement aspects of Sono-Tek; providing extensive expertise in several vital areas of Sono-Tek operations. Prior to joining Sono-Tek, Mrs. Kuha held various positions in high tech manufacturing companies revolving around purchasing and operations. She holds an AAS in business from Dutchess County Community College. 35 DR. ADENIYI LAWAL became a Director in April 2024. He has considerable experience in both industries and academia, having worked with Shell Petroleum Development Company, Texaco Overseas Oil Company, and three different universities. Currently he’s a Professor of Chemical Engineering at the Department of Chemical Engineering & Materials Science, Stevens Institute of Technology where he has been a member of the faculty for over twenty-five years. At Stevens, he has held several administrative positions, including Program Director, Associate Department Chair, and now, Department Chair. Dr. Lawal has directed research groups in academia, and has been a highly successful researcher, having executed several multi-million dollar, and multi-year projects funded by the Department of Energy and the Department of Defense. ACS-Petroleum Research Fund, GAF Materials Corporation, Phillips Netherlands, and International Flavors & Fragrances have also funded his research. He has published extensively in highly esteemed, archival journals and is the recipient of five U.S. and international patents. Dr. Lawal has also been active in scientific societies, organized and chaired national and international conferences. He received a B.Sc (Honors) Degree in Engineering from the University of Ibadan, Nigeria, an S.M. Degree from the Massachusetts Institute of Technology and a Ph.D. from McGill University, Canada, both in Chemical Engineering. Key Attributes, Experience, and Skills: Dr. Lawal’s core expertise is in catalysis, reaction engineering and process intensification with specific application to renewable energy. His extensive research experience and knowledge of the renewable energy landscape bring valuable insights to the Board on emerging local and global business opportunities in green energy. His administrative and leadership experience that has spanned decades is also of value to the Board. CAROL O’DONNELL has been a Director since November 2018. Ms. O’Donnell joined Protégé Partners, an industry leading firm investing in and seeding smaller and emerging hedge fund managers in 2016 and has served as Chief Executive Officer since 2018. She also provides consulting services to OpenDeal, Inc., a financial services company. Prior to joining Protégé Partners, Ms. O’Donnell was the Director of Legal and Compliance with DARA Capital US, Inc., a Swiss-owned boutique registered investment advisory and wealth management firm from 2013 to 2016. She also served as General Counsel to Boothbay Fund Management LLC, a registered investment adviser, from December 2019 through May 2021, and was General Counsel and Chief Compliance Officer of each of the Permal Group and Framework Investment Group from 2004 through 2011 and from 2002 to 2004, respectively. Ms. O’Donnell is a director of Apimeds Pharmaceuticals US, Inc., a New York Stock Exchange listed company (NYSE: APUS), and a trustee of various family trusts. Ms. O’Donnell is admitted to practice law in the State of Connecticut. Key attributes, Experience and Skills: Ms. O’Donnell’s extensive experience as an attorney enables her to bring valuable strategic insights to the Board in the areas of corporate governance, finance and securities law. Ms. O’Donnell also brings leadership and oversight experience to the Board. DR. JOSEPH RIEMER joined the Company in January 2007 as Vice President of Engineering and has been a Director since August 2007. Dr. Riemer served as President from September 2007 until August 2012 when he became Vice President of Food Business Development, which position he held until June 2016. Dr. Riemer holds a Ph.D. in Food Science and Technology from the Massachusetts Institute of Technology (MIT), focusing on food technology, food chemistry, biochemical analysis, and food microbiology. His experience includes seven years with Pfizer in its Adams Confectionary Division, where he was Director, Global Operations Development. Dr. Riemer has also held leading positions with several food, food ingredients, and personal care products companies. He has served in the capacities of research and development, operations, and general management. Prior to joining the Company, he was a management consultant serving clients in the food, biotech and pharmaceutical industries. Key attributes, Experience and Skills: Dr. Riemer’s extensive research and management experience enables him to bring valuable insights to the Board. His considerable experience in the biotech, food and pharmaceutical industries bring specific product application insights to the Board. Dr. Riemer’s previous service as Vice President of Food Business Development helps to provide focus to the Board on this important marketing area. Dr. Riemer also brings leadership and oversight experience to the Board. 36 KIRK WARSHAW, CPA, has been a director since May 2025. He has over 40 years of experience in financial and general management across a diverse range of industries. Since 2015, he has served as the Executive Chairman of Bogue Machine Company, a state-of-the-art machining operation that produces complex components for both commercial and defense contractors, and as Chief Executive Officer and Chief Financial Officer of UAV Turbines, a company focused on developing small turbine engine systems for aerospace and military applications. Mr. Warshaw has also provided advisory services and held interim executive leadership roles at numerous companies, specializing in financial oversight, corporate restructuring, and strategic growth. Earlier in his career, Mr. Warshaw worked in public accounting and financial institutions, earning his CPA in 1982. Key attributes, Experience and Skills: Mr. Warshaw’s extensive experience in financial and operational management at both public and private companies provides the Board with valuable insights. Mr. Warshaw’s significant experience in acquisitions and divestitures and strong operational, accounting, and finance background are valuable resources to the Board as it exercises its oversight duties and support of the Company’s growth strategies. Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the Securities Exchange Act of 1934 requires our Directors, executive officers and persons who own more than ten percent of our common stock to file with the Securities and Exchange Commission initial reports of beneficial ownership and reports of changes of beneficial ownership of common stock. Such persons are also required by Securities and Exchange Commission regulations to furnish us with copies of all such reports. Based solely on a review of such filings, during the year ended February 28, 2026, all of our Directors and executive officers and holders of more than ten percent of our stock have made timely filings of such reports. Code of Ethics The Company has adopted a Code of Business Conduct and Ethics that applies to all directors, officers, and employees. This code of ethics is designed to comply with the NASDAQ marketplace rules related to codes of conduct. A copy of the Company's Code of Ethics is posted on the "information for investors" web page located at http://www.sono-tek.com/code-of-ethics/ and is available in print to any shareholder who requests a copy. The Company intends to satisfy any disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of our code of ethics by posting such information on the Company’s website. Insider Trading Policy We have adopted an Insider Trading Policy governing the purchase, sale and/or other dispositions of our securities by directors, officers and employees, and by the Company itself, that are reasonably designed to promote compliance with insider trading laws, rules and regulations, and any listing standards applicable to us . ITEM 11 EXECUTIVE COMPENSATION The following table sets forth the aggregate remuneration paid or accrued by the Company for fiscal 2026 and fiscal 2025 for each named officer of the Company. 37 Summary Compensation Table Name and Principal Position Year Salary ($) Bonus ($) Stock Awards Option Awards 1 ($) All Other Compensation 2 Total ($) R. Stephen Harshbarger CEO, President and Director 2026 2025 274,000 265,000 63,400 50,500 0 0 60,000 60,000 10,700 10,000 408,100 385,500 Stephen J. Bagley Chief Financial Officer 2026 2025 191,300 185,000 47,000 37,400 0 0 25,000 25,000 7,400 7,200 270,700 254,600 Christopher C. Cichetti Chief Operating Officer 2026 2025 200,000 200,000 47,000 37,400 0 0 45,000 90,000 8,000 7,400 300,000 334,800 1 Option awards in the above table are calculated using the Black-Scholes options pricing model which is further discussed in Note 4 – Stock Based Compensation, in the Company’s consolidated financial statements. 2 All Other Compensation represents Company contributions to the Company’s 401K plan. Officer Compensation Arrangements During fiscal 2026, Mr. Harshbarger was compensated at the rate of $274,000 per annum. During fiscal 2026, Mr. Bagley was compensated at the rate of $191,300 per annum. During fiscal 2026, Mr. Cichetti was compensated at the rate of $200,000 per annum. In addition, each named officer earned bonus compensation based on the achievement of certain operating objectives. Outstanding Equity Awards at Fiscal Year End Name Number of Securities Underlying Unexercised Options (#) Exercisable Number of Securities Underlying Unexercised Options (#) Unexercisable Option Exercise Price ($) Option Expiration Date R. Stephen Harshbarger 5,815 — 6.05 11/18/2031 CEO, President and Director 16,340 — 6.26 02/17/2032 3,937 — 5.96 11/17/2032 3,726 932 5.00 11/16/2033 10,425 12,741 4.12 08/22/2034 — 29,268 3.25 08/21/2035 Stephen J. Bagley 2,750 — 4.45 01/15/2031 Chief Financial Officer 9,804 — 6.26 02/17/2032 1,969 — 5.96 11/17/2032 1,863 466 5.00 11/16/2033 4,344 5,309 4.12 08/22/2034 — 12,195 3.25 08/21/2035 Christopher C. Cichetti 2,750 — 4.45 01/15/2031 Chief Operating Officer 9,804 — 6.26 02/17/2032 1,969 — 5.96 11/17/2032 1,863 466 5.00 11/16/2033 4,969 1,242 5.00 11/16/2033 15,637 19,112 4.12 08/22/2034 — 21,951 3.25 08/21/2035 38 Estimated Payments and Benefits Upon Termination or Change in Control The Company has entered into Executive Agreements with Stephen J. Bagley, the Company’s Chief Financial Officer, Christopher Cichetti, the Company’s Chief Operating Officer, Christopher L. Coccio, the Company’s Executive Chairman and R. Stephen Harshbarger, the Company’s Chief Executive Officer. The agreements provide that in the event of a change of control of the Company followed by a termination of the executives’ employment under certain circumstances, the officers shall receive severance payments equal to two years of the executive’s annual base, commissions and bonus compensation paid by the Company for the previous calendar year. Based on last year’s salary arrangements, if the rights of the foregoing officers were to be triggered following a change of control, they would be entitled to the following payments from the Company: Stephen J. Bagley $455,000, Christopher Cichetti $475,000, Christopher L. Coccio $406,000 and R. Stephen Harshbarger $645,000. Severance Agreements The Company has entered into severance agreements with Stephen J. Bagley, Chief Financial Officer, Christopher Cichetti, Chief Operating Officer, Christopher L. Coccio, Executive Chairman and R. Stephen Harshbarger Chief Executive Officer and President. The agreements provide that in the event of termination of the executive’s employment, other than for cause, the officers shall receive severance payments equal to two weeks of compensation for each full year employed by the Company. Clawback Policy Our Board has adopted an executive compensation recoupment policy consistent with the requirements of the Exchange Act Rule 10D-1 and the Nasdaq listing standards thereunder, to help ensure that incentive compensation is paid based on accurate financial and operating data, and the correct calculation of performance against incentive targets. Our policy addresses recoupment of amounts from performance-based awards paid to all corporate officers, including awards under our equity incentive plans, in the event of a financial restatement to the extent that the payout for such awards would have been less, or in the event of fraud, or intentional, willful or gross misconduct that contributed to the need for a financial restatement. Compensation of Directors Each non-employee director receives $2,500 for each meeting attended. Directors who are employees of the Company receive no additional compensation for serving as directors. For the year ended February 28, 2026, director compensation was as follows: 2026 Director Compensation Name Fees Earned or Paid in Cash ($) Stock Awards ($) Option Awards ($) Non-Equity Incentive Plan Compensation ($) Nonqualified Deferred Compensation Earnings ($) All Other Compensation ($) Total ($) Christopher Coccio — — 50,000 1 — — 220,800 2 270,800 Eric Haskell 5,000 — 12,000 3 — — — 17,000 Adeniyi Lawal 7,500 — 12,000 4 — — — 19,500 Carol O’Donnell 7,500 — 12,000 5 — — — 19,500 Philip Strasburg 6 5,000 6 — — — — — 5,000 Joseph Riemer 7,500 — 12,000 7 — — — 19,500 Kirk Warshaw 7,500 — 12,000 8 — — — 19,500 1 During fiscal 2026, Dr. Coccio received a grant of 29,240 options exercisable at $3.25 per share. At the end of fiscal 2026, Dr. Coccio held an aggregate of 99,744 stock options. 2 Represents salary of $160,000 and bonus of $54,000 paid to Dr. Coccio during fiscal 2026 in connection with his service as Executive Chairman and a Company contribution of $6,800 to the Company’s 401k plan. 3 During fiscal 2026, Mr. Haskell received a grant of 7,018 options exercisable at $3.25 per share. At the end of fiscal 2026, Mr. Haskell held an aggregate of 35,377 stock options. 4 During fiscal 2026, Dr. Lawal received a grant of 7,018 options exercisable at $3.25 per share. At the end of fiscal 2026, Dr. Lawal held an aggregate of 12,351 stock options. 5 During fiscal 2026, Ms. O’Donnell received a grant of 7,018 options exercisable at $3.25 per share. At the end of fiscal 2026, Ms. O’Donnell held an aggregate of 25,377 stock options. 6 Mr. Strasburg did not stand for reelection as a Director and his term concluded in August 2025 upon completion of the Company’s annual meeting of stockholders. 7 During fiscal 2026, Dr. Riemer received a grant of 7,018 options exercisable at $3.25 per share. At the end of fiscal 2026, Dr. Riemer held an aggregate of 27,377 stock options. 8 During fiscal 2026, Mr. Warshaw received a grant of 7,018 options exercisable at $3.25 per share. At the end of fiscal 2026, Mr. Warshaw held an aggregate of 7,018 stock options. 39 Option awards in the above table are calculated using the Black-Scholes options pricing model which is further discussed in Note 4 – Stock Based Compensation, in the Company’s consolidated financial statements. ITEM 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following information is furnished as of May 19, 2026 to indicate beneficial ownership of the Company's Common Stock by each Director, by each named executive officer, by all Directors and executive officers as a group, and by each person known to the Company to be the beneficial owner of more than 5% of the Company's outstanding Common Stock. Such information has been furnished to the Company by the indicated owners. Unless otherwise indicated, the named person has sole voting and investment power. Name (and address if more than 5%) of Beneficial owner Amount Beneficially Owned Percent Directors and Officers *Stephen J. Bagley 54,169 1 ** *Christopher Cichetti 36,992 2 ** *Christopher L. Coccio 370,673 3 2.35% *R. Stephen Harshbarger 305,521 4 1.94% *Eric Haskell 33,850 5 ** *Adeniyi Lawal 2,400 ** *Carol O’Donnell 36,691 6 ** *Joseph Riemer 34,903 7 ** *Kirk Warshaw 1,000 ** All Executive Officers and Directors as a Group 886,709 8 5.57% Additional 5% owners Emancipation Management LLC 9,10 Charles Frumberg 9,10 Circle N Advisors, LLC 9,10 5,472,052 34.82% V. Adah Nicklin 11 915,599 5.83% Dawn Cupero 12 924,289 5.88% The above ownership percentages are based on 15,713,747 shares outstanding as of May 19, 2026. * c/o Sono-Tek Corporation, 2012 Route 9W, Milton, NY 12547. ** Less than 1% 1 Includes 19,915 options currently exercisable issued under the Company’s Stock Incentive Plans. 2 Includes 36,992 options currently exercisable issued under the Company’s Stock Incentive Plans. 3 Includes 4,000 shares held in the name of Dr. Coccio’s wife and 57,226 options currently exercisable issued under the Company’s Stock Incentive Plans. 4 Includes 40,243 options currently exercisable issued under the Company’s Stock Incentive Plans. 5 Includes 24,691 options currently exercisable issued under the Company’s Stock Incentive Plans. 6 Includes 14,691 options currently exercisable issued under the Company’s Stock Incentive Plans. 7 Includes 16,241 options currently exercisable issued under the Company’s Stock Incentive Plans. 40 8 The group total includes 219,826 options currently exercisable issued under the Company’s Stock Incentive Plans. The group total does not include 214,461 options that are currently unexercisable. The group total includes 683 shares and 9,857 currently exercisable options held by Maria Kuha, a Vice President. 9 Emancipation Management LLC, Charles Frumberg and Circle N Advisors share the power to dispose or to direct the disposition of these shares. The Company does not consider these holders to be “affiliates” of the Company. 10 The address of this person is 1065 Main Street, Suite F, PO Box 336, Fishkill, NY 12524. 11 The address of this person is 3 Rivers Edge, Newburgh, NY 12550. 12 The address of this person is 308 Schubauer Dr, Cary, NC 27513. Securities Authorized for Issuance Under Equity Compensation Plans: EQUITY COMPENSATION PLAN INFORMATION Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) Weighted- average exercise price of outstanding options, warrants and rights (b) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) Equity compensation plans approved by security holders: 2013 Stock Incentive Plan 195,810 $ 5.01 — 2023 Stock Incentive Plan 395,201 $ 3.83 2,104,799 Total 591,011 2,104,799 Description of Equity Compensation Plans: 2013 Stock Incentive Plan Under the 2013 Stock Incentive Plan (the "2013 Plan"), up to 2,500,000 options and shares had been available for grant to officers, directors, consultants and employees of the Company and its subsidiaries. No additional options or shares could be granted under the 2013 Plan after June 2023. Under the 2013 Plan options expire ten years after the date of grant. As of February 28, 2026, there were 195,810 options outstanding under the 2013 Plan. 2023 Stock Incentive Plan In May 2023, the Company’s Board of Directors authorized the creation of the 2023 Stock Incentive Plan (the “2023 Plan”) pursuant to which the Company may grant up to 2,500,000 options or shares to officers, directors, employees and consultants of the Company and its subsidiaries. The Company’s shareholders approved the adoption of the 2023 Plan in August 2023. There are currently 395,201 options outstanding under the 2023 Plan. Under the 2023 Plan, option prices must be at least 100% of the fair market value of the common stock at time of grant. For qualified employees, except under certain circumstances specified in the plan or unless otherwise specified at the discretion of the Board of Directors, no option may be exercised prior to one year after date of grant, with the balance becoming exercisable in cumulative installments over a three-year period during the term of the option and terminating at a stipulated period of time after an employee's termination of employment. 41 We do not grant stock option awards in anticipation of the release of material, nonpublic information or time the release of material, nonpublic information based on equity award grant dates, vesting events, or sale events. For all stock option awards, the exercise price is the closing price of our common stock on the NASDAQ capital market on the date option awards are issued. ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Transactions with Related Persons – None Independence of Directors The Company’s Board of Directors is comprised of five “independent directors”, as that term is defined under NASDAQ rules, and two directors who are not “independent directors”. The Company’s “independent directors” are Eric Haskell, Carol O’Donnell, Joseph Riemer, Adeniyi Lawal and Kirk Warshaw. Christopher L. Coccio and R. Stephen Harshbarger are current employees of the Company and therefore are not considered independent. ITEM 14 PRINCIPAL ACCOUNTING FEES AND SERVICES Audit Fees For fiscal 2026 and 2025 the Company paid or accrued fees of approximately $242,000 and $185,000, respectively, for services rendered by CBIZ CPAs, its independent auditors. These fees included audit and review services. Audit Related Fees - None Tax Fees - None All Other Fees – None Pre-Approval Policies and Procedures The Audit Committee’s current policy is to pre-approve all audit and non-audit services that are to be performed and fees to be charged by the Company’s independent auditor to assure that the provision of these services does not impair the independence of the auditor. The Audit Committee pre-approved all audit and non-audit services rendered by the Company’s principal accountants in fiscal 2026 and fiscal 2025. 42 PART IV ITEM 15 EXHIBITS AND FINANCIAL STATEMENT SCHEDULES Ex. No . Description 3(a) 1 Certificate of Incorporation of the Company and all amendments thereto. 3(b) 2 By-laws of the Company as amended. 4(a) 3 Description of Securities 10(a) 4 Sono-Tek Corporation 2013 Stock Incentive Plan. 10(b) 5 Sono-Tek Corporation 2023 Stock Incentive Plan. 10(c) 6 Letter Agreement between Sono-Tek Corporation and Christopher L. Coccio dated October 20, 2017. 10(d) 6 Letter Agreement between Sono-Tek Corporation and R. Stephen Harshbarger dated October 20, 2017. 10(e) 6 Letter Agreement between Sono-Tek Corporation and Stephen J. Bagley dated October 20, 2017. 10(f) 7 Amended and Restated Loan Agreement between Sono-Tek Corporation and M&T Bank dated January 17, 2019. 10(g) 7 Addendum to Loan Agreement (Flexline) between Sono-Tek Corporation and M&T Bank dated January 17, 2019. 10(h) 7 Addendum to Loan Agreement (Loan Limit) between Sono-Tek Corporation and M&T Bank dated January 17, 2019. 10(i) 7 Loan Agreement between Sono-Tek Corporation and M&T Bank dated January 17, 2019. 10(j) 7 Amended and Restated Revolving Demand Note between Sono-Tek Corporation and M&T Bank dated January 17, 2019 . 10(k) 7 Security Agreement between Sono-Tek Corporation and M&T Bank dated January 17, 2019. 10(l) 8 Letter Agreement between Sono-Tek Corporation and Christopher Cichetti dated October 20, 2017. 10(m)9 Executive Agreement by and between the Company and R. Stephen Harshbarger dated as of November 5, 2025 . 10(n)9 Executive Agreement by and between the Company and Christopher L. Coccio dated as of November 5, 2025. 10(o)9 Executive Agreement by and between the Company and Stephen J. Bagley dated as of November 5, 2025. 10(p)9 Executive Agreement by and between the Company and Christopher Cichetti dated as of November 5, 2025. 19 8 Insider Trading Policies and Procedures 14 10 Code of Ethics. 21 11 Subsidiaries of Issuer. 23.1 11 Consent of CBIZ CPAs P.C. 31.1 11 Rule 13a-14/15d – 14(a) Certification. 31.2 11 Rule 13a-14/15d – 14(a) Certification. 32.1 11 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2 11 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97 12 Policy Relating to Recovery of Erroneously Awarded Compensation. 101.INS 14 XBRL Instance Document — This instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH 11 XBRL Taxonomy Extension Schema Document. 101.CAL 11 XBRL Taxonomy Calculation Linkbase Document. 101.DEF 11 XBRL Taxonomy Extension Definition Linkbase Document. 101.LAB 11 XBRL Extension Label Linkbase Document. 101.PRE 11 XBRL Taxonomy Extension Presentation Linkbase Document. 104 11 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). 43 1 Incorporated herein by reference to the Company’s Registration Statement No. 333-11913 on Form S-8 filed on February 18, 2004. 2 Incorporated herein by reference to the Company’s Current Report on Form 8-K dated March 7, 2019 and filed with the Securities and Exchange Commission on March 13, 2019. 3 Incorporated herein by reference to the Company’s Registration Statement on Form 8-A12B filed with the Securities and Exchange Commission on August 26, 2021. 4 Incorporated herein by reference to Exhibit A to the Company’s definitive proxy statement filed with the Securities and Exchange Commission on July 25, 2013. 5 Incorporated herein by reference to Exhibit A to the Company’s definitive proxy statement filed with the Securities and Exchange Commission on July 20, 2023. 6 Incorporated herein by reference to the Company’s Form 10-K for the year ended February 28, 2018. 7 Incorporated herein by reference to the Company’s Form 10-K for the year ended February 28, 2019. 8 Incorporated herein by reference to the Company’s Form 10-K for the year ended February 29, 2024. 9 Incorporated herein by reference to the Company’s Current Report on Form 8-K dated November 5, 2025 and filed with the Securities and Exchange Commission on November 12, 2025. 10 Incorporated herein by reference to the Company’s Current Report on Form 8-K dated September 24, 2020 and filed with the Securities and Exchange Commission on September 17, 2020. 11 Filed herewith. 12 Incorporated herein by reference to the Company’s Current Report on Form 8-K dated November 16, 2023 and filed with the Securities and Exchange Commission on November 17, 2023. ITEM 16 10-K SUMMARY None. 44 SONO-TEK CORPORATION FORM 10-K ITEM 8 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND NOTES FOR THE YEARS ENDED FEBRUARY 28, 2026 and February 28, 2025 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS CBIZ CPAs P.C. (PCAOB ID No: 199 ) CONSOLIDATED FINANCIAL STATEMENTS: Consolidated Balance Sheets as of February 28, 2026 and February 28, 2025 Consolidated Statements of Income For the Years Ended February 28, 2026 and February 28, 2025 Consolidated Statements of Stockholders' Equity For the Years Ended February 28, 2026 and February 28, 2025 Consolidated Statements of Cash Flows For the Years Ended February 28, 2026 and February 28, 2025 Notes on Consolidated Financial Statements F- 1 Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors of Sono-Tek Corporation : Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Sono-Tek Corporation (the “Company”) as of February 28, 2026 and 2025, the related consolidated statements of income, stockholders’ equity and cash flows for the years ended February 28, 2026 and 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, based on our audits, the financial statements present fairly, in all material respects, the financial position of the Company as of February 28, 2026 and 2025, and the results of its operations and its cash flows for the years ended February 28, 2026 and 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. /s/ CBIZ CPAs P.C. CBIZ CPAs P.C. We have served as the Company’s auditor since 2020 (such date takes into account the acquisition of the attest business of Marcum LLP by CBIZ CPAs P.C. effective November 1, 2024). Morristown, NJ May 28, 2026 F- 2 SONO-TEK CORPORATION CONSOLIDATED BALANCE SHEETS February 28, 2026 February 28 2025 ASSETS Current Assets: Cash and cash equivalents $ 7,339,403 $ 5,202,361 Marketable securities 7,469,649 6,727,678 Accounts receivable (less allowance for credit losses of $ 12,225 , respectively) 3,350,953 2,347,764 Inventories 3,923,350 4,474,401 Prepaid expenses and other current assets 743,295 236,261 Total current assets 22,826,650 18,988,465 Land 250,000 250,000 Buildings, equipment, furnishings and leasehold improvements, net 2,173,443 2,610,600 Intangible assets, net 29,791 37,386 Deferred tax asset 1,141,611 1,525,185 TOTAL ASSETS $ 26,421,495 $ 23,411,636 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Accounts payable $ 1,038,885 $ 859,483 Accrued expenses 2,227,401 1,718,574 Customer deposits 3,069,743 2,413,195 Income taxes payable 255,398 496,055 Total current liabilities 6,591,427 5,487,307 Deferred tax liability 55,909 132,134 Total Liabilities 6,647,336 5,619,441 Commitments and Contingencies (Note 13) Stockholders’ Equity Common stock, $ .01 par value; 25,000,000 shares authorized, 15,710,389 issued and outstanding as of February 28, 2026, and 15,751,153 issued and 15,749,037 outstanding as of February 28, 2025 157,104 157,512 Additional paid-in capital 10,186,858 10,018,034 Accumulated earnings 9,430,197 7,624,516 Treasury stock, at cost, 2,116 shares as of February 28, 2025 — ( 7,867 ) Total stockholders’ equity 19,774,159 17,792,195 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 26,421,495 $ 23,411,636 See accompanying notes to consolidated financial statements. F- 3 SONO-TEK CORPORATION CONSOLIDATED STATEMENTS OF INCOME Fiscal Year Ended February 28, 2026 February 28, 2025 Net Sales $ 20,909,315 $ 20,504,381 Cost of Goods Sold 10,349,373 10,765,362 Gross Profit 10,559,942 9,739,019 Operating Expenses Research and product development 2,553,898 2,724,482 Marketing and selling 3,525,239 3,677,915 General and administrative 2,655,836 2,326,582 Total Operating Expenses 8,734,973 8,728,979 Operating Income 1,824,969 1,010,040 Other Income: Interest and dividend income 443,588 488,504 Net unrealized (loss) gain on marketable securities ( 1,498 ) 35,548 Income before Income Taxes 2,267,059 1,534,092 Income Tax Expense 461,378 260,678 Net Income $ 1,805,681 $ 1,273,414 Basic Earnings Per Share $ 0.11 $ 0.08 Diluted Earnings Per Share $ 0.11 $ 0.08 Weighted Average Shares – Basic 15,718,796 15,750,997 Weighted Average Shares – Diluted 15,733,825 15,770,102 See accompanying notes to consolidated financial statements. F- 4 SONO-TEK CORPORATION CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY YEARS ENDED FEBRUARY 28, 2026 AND FEBRUARY 28, 2025 Common Stock Par Value $.01 Additional Paid – In Capital Accumulated Earnings Treasury Stock Total Stockholders’ Equity Shares Amount Balance - February 29, 2024 15,750,880 $ 157,509 $ 9,770,387 $ 6,351,102 — $ 16,278,998 Stock-based compensation expense 247,650 247,650 Cashless exercise of stock options 273 3 ( 3 ) — Treasury stock purchased ( 7,867 ) ( 7,867 ) Net Income 1,273,414 — 1,273,414 Balance - February 28, 2025 15,751,153 $ 157,512 $ 10,018,034 $ 7,624,516 ( 7,867 ) $ 17,792,195 Stock-based compensation expense 316,792 316,792 Proceeds from exercise of stock options 3,327 33 10,580 10,613 Treasury stock purchased ( 151,122 ) ( 151,122 ) Treasury stock retired ( 44,091 ) ( 441 ) ( 158,548 ) 158,989 — Net Income 1,805,681 1,805,681 Balance - February 28, 2026 15,710,389 $ 157,104 $ 10,186,858 $ 9,430,197 — $ 19,774,159 See accompanying notes to consolidated financial statements. F- 5 SONO-TEK CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS Fiscal Year Ended February 28, 2026 February 28, 2025 CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 1,805,681 $ 1,273,414 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 669,311 700,535 Stock-based compensation expense 316,792 247,650 Inventory write-off 97,165 81,389 Unrealized loss/(gain) on marketable securities 1,498 ( 35,548 ) Deferred income tax benefit, net 307,348 ( 366,608 ) (Increase) Decrease in: Accounts receivable ( 1,003,189 ) ( 877,053 ) Inventories 453,886 666,189 Prepaid expenses and other assets ( 507,034 ) ( 28,523 ) (Decrease) Increase in: Accounts payable 179,402 ( 190,259 ) Accrued expenses 508,827 ( 20,904 ) Customer deposits 656,548 ( 1,006,511 ) Income taxes payable ( 240,657 ) 81,248 Net Cash Provided by Operating Activities 3,245,578 525,019 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of equipment, furnishings and leasehold improvements ( 224,558 ) ( 468,798 ) Sale of marketable securities 3,045,439 17,668,060 Purchase of marketable securities ( 3,788,908 ) ( 14,648,839 ) Net Cash (Used in)/Provided by Investing Activities ( 968,027 ) 2,550,423 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from exercise of stock options 10,613 — Purchase of treasury stock ( 151,122 ) ( 7,867 ) Net Cash (Used in) Financing Activities ( 140,509 ) ( 7,867 ) NET INCREASE/DECREASE IN CASH AND CASH EQUIVALENTS 2,137,042 3,067,575 CASH AND CASH EQUIVALENTS: Beginning of year 5,202,361 2,134,786 End of year $ 7,339,403 $ 5,202,361 Supplemental Cash Flow Disclosure: Interest Paid $ — $ — Income Taxes Paid $ 569,630 $ 547,644 See accompanying notes to consolidated financial statements. F- 6 SONO-TEK CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED FEBRUARY 28, 2026 AND FEBRUARY 28, 2025 NOTE 1: BUSINESS DESCRIPTION Sono-Tek Corporation (the “Company”, “Sono-Tek”, “We” or “Our”) was incorporated in New York on March 21, 1975. We are the world leader in the design and manufacture of ultrasonic coating systems for applying precise, thin film coatings to add functional properties, protect or strengthen surfaces on parts and components for the microelectronics/electronics, alternative energy, medical, industrial and emerging research & development/other markets. We design and manufacture custom-engineered ultrasonic coating systems incorporating our patented technology, in combination with strong applications engineering knowledge, to assist our customers in achieving their desired coating solutions. NOTE 2: SIGNIFICANT ACCOUNTING POLICIES Advertising Expenses - The Company expenses the cost of advertising in the period in which the advertising takes place. Advertising expenses for fiscal 2026 and fiscal 2025 were $ 445,000 and $ 438,000 , respectively. Accounts Receivable, net - In the normal course of business, the Company extends credit to customers. Accounts receivable, less an allowance for credit losses, reflect the net realizable value of receivables and approximate fair value. The Company maintains an allowance for credit losses at an amount estimated to be sufficient to cover the risk of collecting less than full payment of financial assets measured at amortized cost, including receivables. The Company estimates expected credit losses based on historical experience, current conditions, and reasonable and supportable forecasts. The Company considers factors such as customer-specific risk characteristics, aging, historical write-off trends, and other relevant economic and environmental conditions in developing the estimate. The Company estimates losses on receivables based on expected losses, including its historical experience of actual losses. Receivables are written off when it is probable that all contractual payments due will not be collected in accordance with the terms of the agreement. At each balance sheet date, the Company evaluates its receivables and will assess the allowance for credit losses based on historical write-off trends. After all reasonable attempts to collect an account receivable have failed, the amount of the receivable is written off against the allowance. As of February 28, 2026 and 2025, the Company's allowance for credit losses was $ 12,225 . Cash and Cash Equivalents - Cash and cash equivalents consist of money market mutual funds, short term commercial paper and short-term certificates of deposit with original maturities of 90 days or less. At February 28, 2026, the Company had $ 5,238,000 of cash in excess of the FDIC insured limit. Consolidation - The accompanying consolidated financial statements of the Company include the accounts of the Company and its wholly owned subsidiary, Sono-Tek Industrial Park, LLC (“SIP”) in conformity with generally accepted accounting principles in the United States (“GAAP”). SIP operates as a real estate holding company for the Company’s real estate operations. All intercompany accounts and transactions have been eliminated in consolidation. Earnings Per Share - Basic earnings per share (“EPS”) is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock under the treasury stock method. Equipment, Furnishings and Leasehold Improvements - Equipment, furnishings and leasehold improvements are stated at cost. Depreciation of equipment and furnishings is computed by use of the straight-line method based on the estimated useful lives of the assets, which range from three 3 to five 5 years. F- 7 Fair Value of Financial Instruments - The Company applies Accounting Standards Codification (“ASC”) 820, Fair Value Measurement (“ASC 820”), which establishes a framework for measuring fair value and clarifies the definition of fair value within that framework. ASC 820 defines fair value as an exit price, which is the price that would be received for an asset or paid to transfer a liability in the Company’s principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value hierarchy established in ASC 820 generally requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the entity’s own assumptions based on market data and the entity’s judgments about the assumptions that market participants would use in pricing the asset or liability and are to be developed based on the best information available in the circumstances. The carrying amounts of financial instruments reported in the accompanying consolidated financial statements for current assets and current liabilities approximate the fair value because of the immediate or short-term maturities of the financial instruments. The valuation hierarchy is composed of three levels. The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The levels within the valuation hierarchy are described below: Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities. The fair values of financial assets of the Company were determined using the following categories at February 28, 2026 and February 28, 2025, respectively: Schedule of significant accounting policies - fair values of financial assets of the company Level 1 Level 2 Level 3 Total Marketable Securities – February 28, 2026 $ 7,359,354 $ 110,295 $ — $ 7,469,649 Marketable Securities – February 28, 2025 $ 6,135,914 $ 591,764 $ — $ 6,727,678 Marketable Securities include certificates of deposit and US Treasury securities, totaling $ 7,469,649 and $ 6,727,678 that are considered to be highly liquid and easily tradeable as of February 28, 2026 and February 28, 2025, respectively. US Treasury securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 and certificates of deposit are classified as Level 2 within the Company’s fair value hierarchy. The Company’s marketable securities are considered to be trading securities as defined under ASC 320 “Investments – Debt and Equity Securities.” F- 8 Income Taxes - The Company accounts for income taxes under the asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences of "temporary differences" by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. If it is more likely than not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized. The Company uses a recognition threshold and a measurement attribute for financial statement recognition and measurement of tax positions taken or expected to be taken in a return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. As of February 28, 2026 and February 28, 2025, there were no uncertain tax positions. On July 4, 2025, the One Big Beautiful Bill Act (the “Act” or “OBBBA”) was signed into law. The Act introduces significant changes to the Internal Revenue Code, including the permanent extension of many provisions of the 2017 Tax Cuts and Jobs Act (“TCJA”) and various new tax incentives and adjustments. The financial reporting implications of the Act were recorded in the income tax provision for the year ended February 28, 2026, in accordance with ASC 740, Income Taxes. The OBBBA did not change the statutory U.S. federal tax rate. Accordingly, the OBBBA did not compel the Company to remeasure its deferred tax assets and liabilities solely because of a rate change. However, the various changes in tax law did impact the Company’s current and deferred tax calculations. The most significant tax provisions impacting the Company include: Bonus Depreciation – The Act permanently restores 100% bonus depreciation for qualified property acquired and placed into service after January 19, 2025. Research and Development (“R&D”) Costs – The Act reinstates the ability for entities to immediately expense domestic R&D costs for tax years beginning after December 31, 2024. Certain small businesses may also retroactively expense R&D costs, which were capitalized under the TCJA during the calendar years 2022 – 2024. In accordance with the Act, for the fiscal year ended February 28, 2026, the Company has expensed the R&D costs incurred for the current calendar year end. Pursuant to the Act, R&D costs amounts previously capitalized and recorded as a deferred tax asset now are eligible to be expensed in full verses being amortized periodically over a five year term. Any prior year R&D amounts capitalized and not utilized in the current year will be carried over as a deferred tax asset. Some states have decoupled from the federal tax provisions of the Act and continue to follow the prior tax laws per the 2017 Tax Cuts and Jobs Act for capitalizing and amortizing R&D costs. The expensing of these costs is subject to taxable income limitations. Intangible Assets - Include costs of patent applications which are deferred and charged to operations over seventeen 17 years for domestic patents and twelve 12 years for foreign patents, which is considered the useful life. Amortization expense for the years ended February 28, 2026 and February 28, 2025 was $ 7,595 and $ 10,180 , respectively. The accumulated amortization of patents is $ 230,636 and $ 223,041 at February 28, 2026 and February 28, 2025, respectively. The annual amortization expense of such intangible assets is expected to be approximately $ 8,000 per year for the next four years. Inventories - Inventories are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out (FIFO) method for raw materials, subassemblies and work-in-progress and the specific identification method for finished goods. Management compares the cost of inventory with the net realizable value and, if applicable, an allowance is made for writing down the inventory to its net realizable value, if lower than cost. On an ongoing basis, inventory is reviewed for potential write-down for estimated obsolescence or unmarketable inventory based upon forecasts for future demand and market conditions. Land and Buildings - Land and buildings are stated at cost. Buildings are being depreciated by use of the straight-line method based on an estimated useful life of forty 40 years. At February 28, 2026 and February 28, 2025, the Company had Land, stated at cost of $ 250,000 . F- 9 Long-Lived Assets - The Company periodically evaluates the carrying value of long-lived assets, including intangible assets, when events and circumstances warrant such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. No impairment losses were identified or recorded for the years ended February 28, 2026 and February 28, 2025 on the Company’s long-lived assets. Management Estimates - The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recently Adopted Accounting Pronouncements – In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures. This ASU requires greater disaggregation of information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. This ASU applies to all entities subject to income taxes and is intended to help investors better understand an entity’s exposure to potential changes in jurisdictional tax legislation and assess income tax information that affects cash flow forecasts and capital allocation decisions. This ASU is effective for annual periods beginning after December 15, 2024, with early adoption permitted. This ASU should be applied on a prospective basis although retrospective application is permitted. The Company has adopted this ASU on a retrospective basis, and the standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. See Note: 9: Income Taxes, for the Company’s income tax disclosures. Recent Accounting Pronouncements Not Yet Adopted - In November 2024, the FASB issued ASU 2024-03 – Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which is intended to provide more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation and amortization) included in certain expense captions presented on the consolidated statement of operations. The guidance in this ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements and related disclosures. Product Warranty - Expected future product warranty expense is recorded when revenue is recognized for product sales. Research and Product Development Expenses - Research and product development expenses represent engineering and other expenditures incurred for developing new products, for refining the Company's existing products and for developing systems to meet unique customer specifications for potential orders or for new industry applications and are expensed as incurred. During fiscal 2026 and fiscal 2025, the Company spent approximately $ 2,554,000 and $ 2,724,000 , respectively, on research and development activities related to new products and services and the ongoing improvement of existing products and services. Revenue Recognition - The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: F- 10 • Identification of the contract, or contracts, with a customer • Identification of the performance obligations in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, performance obligations are satisfied Stock-Based Compensation - The Company currently uses a Black-Scholes option pricing model to calculate the fair value of its stock options. The fair value of each option is estimated on the date of grant based on the Black-Scholes options-pricing model utilizing certain assumptions for a risk-free interest rate; volatility; and expected lives of the awards. The Company primarily uses historical data to determine the assumptions to be used in the Black-Scholes model. The assumptions used in calculating the fair value of share-based payment awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. ASC 718 requires the recognition of the fair value of stock compensation expense to be recognized over the vesting term of such award. The Company accounts for forfeitures as they occur. NOTE 3: REVENUE RECOGNITION The Company’s sales revenue is derived primarily from short term contracts with customers, which, on average, are in effect for less than twelve months. Sales revenue from manufactured equipment transferred at a single point in time accounts for a majority of the Company’s revenue. Sales revenue is recognized when control of the Company’s manufactured equipment is transferred to its customers in an amount that reflects the consideration the Company expects to receive based upon the agreed transaction price. The Company’s performance obligations are satisfied when its customers take control of the purchased equipment, in accordance with the contract terms. Based on prior experience, the Company reasonably estimates its sales returns and warranty reserves. Sales are presented net of discounts and allowances. Discounts and allowances are determined when a transaction is negotiated. The Company does not grant its customers or independent representatives the ability to return equipment, nor does it grant price adjustments after a sale is complete. The Company does not capitalize any sales commission costs related to the acquisition of a contract. All commissions related to a performance obligation that are satisfied at a point in time are expensed when the customer takes control of the purchased equipment and revenue is recognized. The Company applies the practical expedient in paragraph ASC 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one-year or less. The Company requires cash deposits when an order is placed and subsequent cash deposits before a customer’s equipment is shipped. At the time of shipment, the Company will extend credit terms to its customers. The credit terms do not contain a significant financing component (credit terms over more than one year). At February 28, 2026, the Company had received $ 3,070,000 in customer deposits, representing contract liabilities. At February 28, 2025, the Company had received $ 2,413,000 in customer deposits, representing contract liabilities, and had issued Letters of Credit in the amount of $ 106,000 to secure these customer deposits. At February 28, 2025, the Company was utilizing $ 106,000 of its available credit line to collateralize these letters of credit. At February 29, 2024, the Company had received $ 3,420,000 in cash deposits, representing contract liabilities. F- 11 The Company’s sales revenue, by product line is as follows: Schedule of revenue recognition - sales revenue by product line Twelve Months Ended February 28, February 28, 2026 % of total 2025 % of total Fluxing Systems $ 713,000 3 % $ 467,000 2 % In-Line Coating Systems 7,070,000 34 % 3,703,000 18 % Multi-Axis Coating Systems 8,055,000 39 % 10,678,000 52 % OEM Systems 1,210,000 6 % 1,484,000 7 % Other 3,861,000 18 % 4,172,000 21 % TOTAL $ 20,909,000 $ 20,504,000 NOTE 4: STOCK-BASED COMPENSATION Stock Options – In May 2023, the Company’s Board of Directors authorized the creation of the 2023 Stock Incentive Plan (the “2023 Plan”) pursuant to which the Company may grant up to 2,500,000 options or shares to officers, directors, employees and consultants of the Company and its subsidiaries. The Company’s shareholders approved the adoption of the 2023 Plan in August 2023. The 2023 Plan replaced the 2013 Stock Incentive Plan (the “2013 Plan”) under which no additional options or shares could be granted after June 2023. There are currently 395,201 and 195,810 options outstanding, respectively, under the 2023 Plan and the 2013 Plan. During fiscal 2026, the Company granted options to acquire 154,328 shares to employees exercisable at prices ranging from $ 3.25 to $ 3.77 and options to acquire 35,088 shares to the non-employee members of the board of directors with an exercise price of $ 3.25 . The options granted to employees and directors vest over three 3 years and expire in ten 10 years. The options granted by the Company during fiscal 2026 had a combined weighted average grant date fair value of $ 3.26 per share. During fiscal 2025, the Company granted options to acquire 134,656 shares to employees exercisable at prices ranging from $ 4.12 to $ 4.87 and options to acquire 26,667 shares to the non-employee members of the board of directors with an exercise price of $ 4.12 . The options granted to employees and directors vest over three 3 years and expire in ten 10 years. The options granted by the Company during fiscal 2025 had a combined weighted average grant date fair value of $ 4.13 per share. A summary of the activity for both plans, for fiscal 2026 and fiscal 2025 is as follows: Stock-based compensation - summary of stock options Weighted Average Stock Options Exercise Price $ Remaining Outstanding Exercisable Outstanding Exercisable Term - Years Balance - February 29, 2024 295,542 181,376 $ 4.99 $ 4.89 8.04 Granted 161,323 4.13 Exercised ( 1,209 ) ( 3.19 ) Cancelled ( 27,657 ) ( 5.49 ) Balance - February 28, 2025 427,999 226,913 $ 4.64 $ 4.90 7.93 Granted 189,416 $ 3.26 Exercised ( 3,327 ) ( 3.19 ) Cancelled ( 23,077 ) ( 4.24 ) Balance - February 28, 2026 591,011 305,278 $ 4.22 $ 4.81 7.75 The aggregate intrinsic value of the Company’s vested and exercisable options at February 28, 2026 was $ 298,766 . F- 12 For the years ended February 28, 2026 and February 28, 2025, the Company recognized $ 317,000 and $ 248,000 in stock-based compensation expense, respectively. Such amounts are included in general and administrative expenses on the consolidated statements of income. Total compensation expense related to non-vested options not yet recognized as of February 28, 2026 was $ 448,000 and will be recognized over the next three 3 years based on vesting date. The amount of future stock option compensation expense could be affected by any future option grants or by any forfeitures. During the year ended February 28, 2026, the Company had net settlement exercises of stock options, whereby, the optionee did not pay cash for the options but instead received the number of shares equal to the difference between the exercise price and the market price on the date of exercise. Cashless exercises during the years ended February 28, 2026 and 2025 resulted in 0 and 273 shares of common stock issued, respectively. Determining the appropriate fair value of the stock-based awards requires the input of subjective assumptions, including the fair value of the Company’s common stock, and for stock options, the expected life of the option, and the expected stock price volatility. The Company uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. The expected term of the options is estimated based on the Company’s historical exercise rate. The expected life of awards that vest immediately use the contractual maturity since they are vested when issued. For stock price volatility, the Company uses its expected volatility of the price of the Company’s common stock based on historical activity. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option at the grant-date. The weighted-average fair value of options has been estimated on the date of grant using the Black-Scholes options-pricing model. The weighted-average Black-Scholes assumptions are as follows: Schedule of weighted-average black-scholes assumptions Fiscal Year Ended February 28, 2026 February 28, 2025 Expected life 5 - 8 years 5 - 8 years Risk free interest rate 3.81 % - 4.32 % 3.64 % - 4.39 % Expected volatility 54.49 % - 56.95 % 55.19 % - 60.34 % Expected dividend yield 0 % 0 % NOTE 5: INVENTORIES Inventories consist of the following: Schedule of inventory, current February 28, 2026 February 28, 2025 Raw materials and subassemblies $ 1,931,294 $ 2,322,821 Finished goods 932,866 1,012,600 Work in process 1,059,190 1,138,980 Total $ 3,923,350 $ 4,474,401 The Company maintains an allowance for slow-moving inventory for raw materials and finished goods. The recorded allowances at February 28, 2026 and February 28, 2025, were $ 445,294 and $ 398,165 , respectively. F- 13 The Company maintains a valuation allowance for slow moving inventory for raw materials and finished goods. The valuation allowance creates a new cost basis for the slow-moving inventory, and the new cost basis is not subsequently marked up through a reduction in the valuation allowance based on any changes in the underlying facts and circumstances. When the valuation allowance is initially recorded, the increase to the allowance is recognized as an increase in cost of sales. The valuation allowance is only reduced if or when the underlying reserved inventory is sold or destroyed, at which time the recognized cost of sales would include the adjusted cost basis of the reserved inventory. During the years ended February 28, 2026 and 2025, the Company recorded approximately $ 97,000 and $ 81,000 , respectively, in additional allowances for slow moving inventory. NOTE 6: BUILDINGS, EQUIPMENT, FURNISHINGS AND LEASEHOLD IMPROVEMENTS Buildings, equipment, furnishings and leasehold improvements consist of the following: Buildings, equipment, furnishings and leasehold improvements February 28, February 28, 2026 2025 Buildings $ 2,250,000 $ 2,250,000 Laboratory equipment 1,860,306 1,843,945 Machinery and equipment 1,951,118 1,921,722 Leasehold improvements 1,105,132 1,048,328 Tradeshow and demonstration equipment 1,249,850 1,249,850 Furniture and fixtures 1,967,339 1,877,548 10,383,745 10,191,393 Less: Accumulated depreciation ( 8,210,302 ) ( 7,580,793 ) $ 2,173,443 $ 2,610,600 Depreciation expense for the years ended February 28, 2026 and February 28, 2025 was $ 661,716 and $ 690,354 , respectively. NOTE 7: ACCRUED EXPENSES Accrued expenses consist of the following: Accrued expenses February 28, 2026 February 28, 2025 Accrued compensation $ 651,967 $ 565,354 Estimated warranty costs 658,150 578,425 Estimated installation costs 319,000 81,000 Accrued sales tax 30,164 15,000 Accrued commissions 128,908 147,459 Professional fees 151,521 94,521 Other accrued expenses 287,691 236,815 Total accrued expenses $ 2,227,401 $ 1,718,574 NOTE 8: REVOLVING LINE OF CREDIT The Company has a $ 1,500,000 revolving line of credit at prime which was 6.750 % at February 28, 2026 and 7.50 % at February 28, 2025. The revolving credit line is collateralized by the Company’s accounts receivable and inventory. The revolving credit line is payable on demand and must be retired for a 30-day period, once annually. If the Company fails to perform the 30-day annual pay down or if the bank elects to terminate the credit line, the bank may, at its option, convert the outstanding balance to a 36-month term note with payments including interest in 36 equal installments. As of February 28, 2026, $ 0 of the Company’s credit line was being utilized to collateralize Letters of Credit issued to customers that have remitted cash deposits to the Company on existing orders. As of February 28, 2026, there were no outstanding borrowings under the line of credit, and the unused portion of the credit line was $ 1,500,000 . F- 14 As of February 28, 2025, $ 106,000 of the Company’s credit line was being utilized to collateralize Letters of Credit issued to customers that have remitted cash deposits to the Company on existing orders. The Letters of Credit expired in June 2025. As of February 28, 2025, there were no outstanding borrowings under the line of credit, and the unused portion of the credit line was $ 1,394,000 . NOTE 9: INCOME TAXES The annual provision (benefit) for income taxes differs from amounts computed by applying the maximum U.S. Federal income tax rate of 21% to pre-tax income as follows: Income taxes - income tax reconciliation Twelve Months Ended February 28, February 28, 2026 % of total 2025 % of total Expected federal income tax $ 476,082 21 % $ 322,159 21 % State tax, net of federal 56,906 2.5 % 30,884 2 % Research and development tax credits ( 144,164 ) ( 6.9 % ) ( 151,529 ) ( 10 % ) Permanent differences: Non-Deductible equity-based compensation 66,526 3 % 52,007 3 % Other $ 6,028 0.3 % $ 7,157 0.04 % Income tax expense 461,378 20 % 260,678 17 % The Company files state and local income tax returns in more than twenty state and local jurisdictions. One state, California, makes up the majority of the state taxes due. In fiscal 2026 and fiscal 2025, California state taxes were approximately $ 28,000 and $ 17,000 , respectively. All other state taxes are significantly less. Components of the current and deferred tax expense are as follows: Income taxes - current and deferred tax expense February 28, 2026 February 28, 2025 Current: Federal $ 112,987 $ 548,743 State 40,094 78,543 Total current income tax 153,081 627,286 Deferred: Federal 306,467 ( 318,949 ) State 1,830 ( 47,659 ) Total deferred income tax 308,297 ( 366,608 ) Income tax expense $ 461,378 $ 260,678 In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company has Massachusetts research and development tax credits that have been fully reserved as management does not foresee utilizing such tax credits in the foreseeable future. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and projections for future taxable income over periods in which the deferred tax assets are deductible. Management believes it is more likely than not that the Company will realize the benefits of its other deferred tax assets. The Company had no uncertain tax positions in 2026. There are no interest and penalties related to uncertain tax positions in 2026. As of February 28, 2026, open years related to the federal and state jurisdictions are 2025, 2024 and 2023. F- 15 The deferred tax asset and liability are comprised of the following: Income taxes - deferred tax asset and liability components February 28, 2026 February 28 2025 Deferred tax asset Allowance for inventory $ 107,000 $ 92,000 Allowance for accounts receivable 3,000 3,000 Capitalized R&D expenses – IRC Section 174 633,000 1,277,000 Accrued expenses and other 255,000 154,000 Research & Development tax credits 144,000 — Research & Development tax credits – Massachusetts 498,000 383,000 Sub-total deferred tax asset 1,640,000 1,909,000 Less valuation allowance – Massachusetts R&D tax credits ( 498,000 ) ( 383,000 ) Deferred tax asset – Long Term $ 1,142,000 $ 1,526,000 Deferred tax liability Building and leasehold depreciation ( 56,000 ) ( 132,000 ) Deferred tax liability – Long Term $ ( 56,000 ) $ ( 132,000 ) The following table presents income taxes paid (net of funds received), disaggregated by jurisdiction: Schedule of federal income tax February 28, 2026 February 28, 2025 Federal $ 500,000 266,862 State – California 32,000 46,500 State – Others 37,630 57,792 Foreign — — Total Income Taxes Paid $ 569,630 $ 371,154 NOTE 10: EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share: Schedule of computation of basic and diluted earnings per share February 28, 2026 February 28, 2025 Numerator for basic and diluted earnings per share $ 1,805,681 $ 1,273,414 Denominator for basic earnings per share - weighted average 15,718,796 15,750,997 Effects of dilutive securities: Stock options for employees, directors and outside consultants 15,029 19,105 Denominator for diluted earnings per share 15,733,825 15,770,102 Basic Earnings Per Share – Weighted Average $ 0.11 $ 0.08 Diluted Earnings Per Share – Weighted Average $ 0.11 $ 0.08 At February 28, 2026, the total number of stock options excluded from the computation of diluted income per share because the effect of inclusion would have been anti-dilutive is 342,074 . F- 16 NOTE 11: CUSTOMER CONCENTRATIONS AND FOREIGN SALES Export sales to customers located outside the United States and Canada were approximately as follows: Schedule of customer concentrations and foreign sales February 28, 2026 February 28, 2025 Asia Pacific (APAC) 2,630,000 2,758,000 Europe, Middle East, Africa (EMEA) 3,742,000 4,431,000 Latin America 591,000 809,000 $ 6,963,000 $ 7,998,000 During fiscal 2026 and fiscal 2025, sales to foreign customers accounted for approximately $ 6,963,000 and $ 7,998,000 , or 33 % and 39 % respectively, of total revenues. For the fiscal year ended February 28, 2026, one customer accounted for 28 % of the Company’s revenues. Three customers accounted for 61 % of the outstanding accounts receivables February 28, 2026. For the fiscal year ended February 28, 2025, one customer accounted for 11 % of the Company’s revenues. Two customers accounted for 25 % of the outstanding accounts receivables February 28, 2025. NOTE 12: SEGMENT DATA The Company operates in one segment. The chief operating decision maker, who is responsible for allocating resources and assessing performance, has been identified as the Chief Executive Officer (the “CODM”). The CODM assesses the financial performance of the Company and decides how to allocate resources based on operating income. The following table presents our segment data (rounded to the nearest thousand): Schedule of segment data Fiscal Year Ended 2026 2025 Net Sales $ 20,909,000 $ 20,504,000 Direct Cost of Goods Sold Materials & Freight 7,915,000 8,126,000 Production Labor 428,000 817,000 Depreciation 206,000 243,000 Other 453,000 402,000 9,002,000 9,588,000 Service Department Salaries 539,000 560,000 Travel 162,000 218,000 Outside Installations 242,000 42,000 Warranty Costs 132,000 121,000 Other 272,000 236,000 1,347,000 1,177,000 Total Cost of Goods & Service 10,349,000 10,765,000 Gross Profit 10,560,000 9,739,000 Research & Product Development Salaries 1,851,000 1,879,000 Insurance 131,000 167,000 Depreciation 221,000 231,000 R & D Materials 168,000 233,000 Other 183,000 214,000 2,554,000 2,724,000 F- 17 Marketing and Selling Salaries 1,789,000 1,809,000 Commissions 635,000 767,000 Insurance 214,000 196,000 Travel & Entertainment 123,000 157,000 Advertising / Trade Show 445,000 438,000 Depreciation 103,000 87,000 Other 216,000 224,000 3,525,000 3,678,000 General and Administrative Salaries and Wages 1,137,000 1,051,000 Insurance 194,000 183,000 Depreciation and Amortization 73,000 76,000 Professional Fees 375,000 384,000 Corporate Expenses 435,000 361,000 Stock Based Compensation 317,000 248,000 Misc. Other 126,000 24,000 2,657,000 2,327,000 Total Operating Expenses 8,736,000 8,729,000 Operating Income 1,824,000 1,010,000 Interest Income & Unrealized Gain 443,000 524,000 Income Before Taxes 2,267,000 1,534,000 Income Tax Expense 461,000 261,000 Net Income $ 1,806,000 $ 1,273,000 NOTE 13: COMMITMENTS AND CONTINGENCIES The Company did not have any material commitments or contingencies as of February 28, 2026. The Company is subject, from time to time, to claims by third parties under various legal disputes. The defense of such claims, or any adverse outcome relating to any such claims, could have a material adverse effect on the Company’s liquidity, financial condition, and cash flows. As of February 28, 2026, the Company did not have any pending legal actions. F- 18 SIGNATURES In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: May 28, 2026 Sono-Tek Corporation (Registrant) By: /s/ R. Stephen Harshbarger R. Stephen Harshbarger, Chief Executive Officer and President In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. /s/ Dr. Christopher L Coccio May 28, 2026 /s/ Eric Haskell May 28, 2026 Christopher L. Coccio Eric Haskell Executive Chairman and Chairman of the Board of Directors Director /s/ Stephen J. Bagley May 28, 2026 / s/ Dr. Joseph Riemer May 28, 2026 Stephen J. Bagley Dr. Joseph Riemer Chief Financial Officer Director /s/ Carol O’Donnell May 28, 2026 /s/ Adeniyi Lawal May 28, 2026 Carol O’Donnell Adeniyi Lawal Director Director /s/ R. Stephen Harshbarger May 28, 2026 /s/ Kirk Warshaw May 28, 2026 R. Stephen Harshbarger Kirk Warshaw Chief Executive Officer and President Director