# Techprecision Corp: Form 10-K for the period ended Mar 31, 2026 - Company: [Techprecision Corp](/companies/tpcs.md) (CIK 1328792) - Form: 10-K - Filed: 2026-06-25 - Accepted by EDGAR: Jun 25, 2026, 16:05 ET - Period: 2026-03-31 - Accession: 0001104659-26-077758 - Inline XBRL: yes - Main document: https://www.sec.gov/Archives/edgar/data/1328792/000110465926077758/tpcs-20260331x10k.htm - All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1328792/000110465926077758/ ## Figures reported in this filing Standardized XBRL line items for the period ended 2026-03-31. | Line item | Period | Value | XBRL concept | | --- | --- | ---: | --- | | Revenue | 12 months, 2025-04-01 to 2026-03-31 | $31.6m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax | | Cost of revenue | 12 months, 2025-04-01 to 2026-03-31 | $26.7m | us-gaap:CostOfRevenue | | Gross profit | 12 months, 2025-04-01 to 2026-03-31 | $5.0m | us-gaap:GrossProfit | | Selling, general and administrative | 12 months, 2025-04-01 to 2026-03-31 | $6.0m | us-gaap:SellingGeneralAndAdministrativeExpense | | Operating income | 12 months, 2025-04-01 to 2026-03-31 | −$1.1m | us-gaap:OperatingIncomeLoss | | Interest expense | 12 months, 2025-04-01 to 2026-03-31 | $485.0k | us-gaap:InterestExpenseNonoperating | | Income tax | 12 months, 2025-04-01 to 2026-03-31 | $31.0k | us-gaap:IncomeTaxExpenseBenefit | | Net income | 12 months, 2025-04-01 to 2026-03-31 | −$1.7m | us-gaap:NetIncomeLoss | | Diluted EPS | 12 months, 2025-04-01 to 2026-03-31 | −$0.17 | us-gaap:EarningsPerShareDiluted | | Basic EPS | 12 months, 2025-04-01 to 2026-03-31 | −$0.17 | us-gaap:EarningsPerShareBasic | | Diluted shares (weighted) | 12 months, 2025-04-01 to 2026-03-31 | 9,912,839 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding | | Operating cash flow | 12 months, 2025-04-01 to 2026-03-31 | $6.0k | us-gaap:NetCashProvidedByUsedInOperatingActivities | | Capital expenditure | 12 months, 2025-04-01 to 2026-03-31 | $3.3m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment | | Cash and equivalents | at 2026-03-31 | $431.0k | us-gaap:Cash | | Current assets | at 2026-03-31 | $17.7m | us-gaap:AssetsCurrent | | Total assets | at 2026-03-31 | $32.3m | us-gaap:Assets | | Current liabilities | at 2026-03-31 | $18.2m | us-gaap:LiabilitiesCurrent | | Total liabilities | at 2026-03-31 | $24.6m | us-gaap:Liabilities | | Shareholders' equity | at 2026-03-31 | $7.7m | us-gaap:StockholdersEquity | ## Business As filed, 22,579 characters. ### Our Business We are a manufacturer of precision, large-scale fabricated and machined metal structural components and systems. We offer a full range of services required to transform raw materials into precision finished products. We sell these finished products to customers in two main industry groups: defense and precision industrial. Our mission is to be a leading end-to-end service provider to our customers by furnishing custom, fully integrated solutions for complete products that require custom fabrication, precision machining, assembly, integration, inspection, non-destructive evaluation, and testing. We work with our customers to manufacture products in accordance with the customers’ drawings and specifications. Our work complies with specific national and international codes and standards applicable to our industry. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service. We have two wholly owned subsidiaries that are each a reportable segment, Ranor and Stadco. Each reportable segment focuses on the manufacture and assembly of specific components, primarily for defense and other precision industrial customers. For discussion of the operating results of our reporting business segments, refer to “*Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”* and Note 16, *Segment Information*, in the Notes to the Consolidated Financial Statements under “*Item 8. Financial Statements and Supplementary Data.”* ### About Us We are a Delaware corporation organized in 2005 under the name Lounsberry Holdings II, Inc. On February 24, 2006, we acquired all of the issued and outstanding capital stock of our wholly owned subsidiary Ranor, Inc., or “Ranor.” On March 6, 2006, following the acquisition of Ranor, we changed our corporate name to TechPrecision Corporation. Ranor, together with its predecessors, has been in continuous operation since 1956. From February 24, 2006, until our acquisition of Stadco in August 2021, our primary business has been the business of Ranor. On August 25, 2021, the Company completed its acquisition of Stadco, a company in the business of manufacturing high-precision parts, assemblies and tooling for aerospace, defense, research and commercial customers, pursuant to that certain stock purchase agreement with Stadco New Acquisition, LLC, Stadco Acquisition, LLC, Stadco and each equity holder of Stadco Acquisition, LLC. On August 25, 2021, pursuant to the stock purchase agreement, and upon the terms and subject to the conditions therein, the Company, through Stadco New Acquisition, LLC, acquired all of the issued and outstanding stock of Stadco from Stadco Acquisition, LLC. As a result, Stadco is now our wholly owned indirect subsidiary. Our executive offices are located at 1 Bella Drive, Westminster, Massachusetts 01473, and our telephone number is (978) 874-0591. Our website is www.techprecision.com. Information on our website, or any other website, is not incorporated by reference in this annual report. References in this annual report to the “Company,” “we,” “us,” “our” and similar words refer to TechPrecision Corporation and its subsidiaries, unless the context indicates otherwise, while references to “TechPrecision” refer to TechPrecision Corporation and not its subsidiaries. ### General TechPrecision, through our wholly owned subsidiaries, is a manufacturer of large-scale metal fabricated and machined precision components and equipment. These components are used primarily in the defense and aerospace industries, and secondarily in the precision industrial markets. All our operations and customers are in the United States. We work with our customers to manufacture components in accordance with the customers’ drawings and specifications. Our work complies with specific military specifications and standards as well as national and international codes and standards required by our customers. We believe that we have earned our reputation through outstanding technical expertise, attention to detail, and a total commitment to quality and excellence in customer service. The manufacturing operations of our Ranor subsidiary are situated on approximately 65 acres in Westminster, Massachusetts. Leveraging our 145,000 square foot facilities, Ranor provides a full range of custom solutions to transform material into precision finished welded components and precision finished machined components up to 100 tons: manufacturing engineering, materials management and traceability, high-precision heavy fabrication (in-house fabrication operations include cutting, press and roll forming, welding, heat treating, assembly, blasting and painting), heavy high-precision machining (in-house machining operations include CNC programming, finishing, and assembly), QC inspection including portable CMM, NonDestructive Testing, and final packaging. All manufacturing at Ranor is performed in accordance with customer requirements. Ranor is an ISO 9001:2015 certificate holder. Ranor is a U.S. defense-centric company with over 95% of its revenue in the defense sector. Ranor is registered and compliant with regulations under the International Traffic in Arms Regulation (“ITAR”). The manufacturing operations of our Stadco subsidiary are situated in an industrial self-contained multi-building complex comprised of approximately 183,000 square feet under roof in Los Angeles, California. Stadco manufactures large mission-critical components on several high-profile military aircraft, military helicopter, and military space programs. Stadco has been a critical supplier to a blue-chip customer base that includes some of the largest OEMs and prime contractors in the defense and aerospace industries. Stadco also manufactures tooling, molds, fixtures, jigs and dies used in the production of defense-centric aircraft components. Our Stadco subsidiary, similar to Ranor, provides a full range of custom solutions: manufacturing engineering, materials management and traceability, high-precision fabrication (in-house fabrication operations include waterjet cutting, press forming, welding, and assembly) and high-precision machining (in-house machining operations include CNC programming, finishing, and assembly), QC inspection including both fixed and portable CMM NonDestructive Testing, and final packaging. In addition, Stadco features a large electron beam welding cell, and two NonDestructive Testing work cells, a unique mission-critical technology set. All manufacturing at Stadco is performed in accordance with customer requirements. Stadco is an AS 9100 D and ISO 9001:2015 certificate holder and a NADCAP NonDestructive Testing certificate holder. Stadco is a U.S. defense-centric company with almost all of its revenue in the defense sector. Stadco is registered and compliant with ITAR. All of the Company’s operations, assets, and customers are located in the U.S. Executive management and the financial reporting function is based in Westminster, Massachusetts through our two reportable segments, Ranor and Stadco. ### Products We manufacture a wide variety of products pursuant to customer contracts and based on individual customer needs. We can also provide manufacturing engineering services to assist customers in optimizing their engineering designs for manufacturing efficiency. We do not design the products we manufacture but rather manufacture according to “build-to-print” requirements specified by our customers. Accordingly, we do not distribute the products that we manufacture on the open market, and we do not market any specific products on an on-going basis. We do not own the intellectual property rights to any proprietary marketed product, and we do not manufacture products in anticipation of orders. Manufacturing operations do not commence on any project before we receive a customer’s purchase order. We only consider contracts that cover specific products within the capability of our resources. We primarily target repeating custom programs with relatively mature and stable designs in order to provide long-term solutions for our customers. The multi-unit work is repeat work or a single product with multiple quantity releases. Secondarily, our activities include a variety of both multi-unit and one-off requirements. The one-off work is typically either a prototype or a unique, one-of-a-kind component. Changes in regulations and market demand for our manufacturing expertise can be significant and sudden and require us to adapt to the needs of the customers that we serve. Understanding this dynamic, we focus on the defense industry in order to reliably pivot with our defense customers to jointly develop the capability to transform our workforce to manufacture components in accordance with our own and our external customers’ changing requirements. We primarily serve customers in the defense and aerospace markets, secondarily in the precision industrial sectors. Within these sectors, we have manufactured custom components for U.S. Navy submarines and aircraft carriers, USMC military helicopters, defense and aerospace programs. Our contracts are generated both through negotiation with the customer and from bids made pursuant to a request for proposal. Our ability to receive contract awards is dependent upon the contracting party’s perception of such factors as our ability to perform on time, our history of performance, including quality, our financial condition, and our ability to price our services competitively. ### Source of Supply Our manufacturing operations are partly dependent on the availability of raw materials. Most of our contracts with customers require the use of customer-supplied raw materials in the manufacture of their product. Accordingly, raw material requirements vary with each contract and are dependent upon customer requirements and specifications. We have established relationships with numerous suppliers. When we do buy raw materials, we endeavor to establish alternate sources of material supply to reduce our dependency on any one supplier and strive to maintain a minimal raw material inventory. Our projects include the manufacturing of products from various traditional as well as specialty metal alloys. These materials may include, but are not limited to steel, nickel, monel, inconel, aluminum, stainless steel, and other alloys. Certain of these materials are subject to long-lead time delivery schedules. In the fiscal year ended March 31, 2026, or “fiscal 2026”, three suppliers accounted for 10% or more of our purchased material. In the fiscal year ended March 31, 2025, or “fiscal 2025”, four suppliers accounted for 10% or more of our purchased material. ### Marketing While we have significant customer concentration, we endeavor to broaden our customer base as well as the industries we serve. We market to our existing customer base and initiate contacts with new potential customers through various sources including personal contacts, customer referrals, and referrals from other businesses. A significant portion of our business is the result of competitive bidding processes and from contract negotiation. We believe that the reputation we have developed with our current customers represents an important part of our marketing effort. Requests for quotations received from customers are reviewed to determine the specific requirements and our ability to meet such requirements. Quotations are prepared by estimating the material and labor costs and assessing our current backlog to determine our delivery commitments. Competitive bid quotations are submitted to the customer for review and award of contract. Negotiation bids typically require the submission of additional information to substantiate the quotation. The bidding process can range from several weeks for a competitive bid to several months for a negotiation bid before the customer awards a contract. ### Research and Product Development Many of our customers generate drawings illustrating their projected unit design and technology requirements. Our research and product development activities are limited and focused on delivering robust production solutions to such projected unit design and technology requirements. We follow this product development methodology in all our major product lines. For these reasons, we incurred no expenses for research and development in fiscal 2026 and fiscal 2025. ### Principal Customers A significant portion of our business is generated by a small number of major customers. The balance of our business consists of discrete projects for numerous other customers. As industry and market demand changes, our major customers may also change. Our ten largest customers generated 92% and 96% of our total revenue in fiscal 2026 and fiscal 2025, respectively. Our group of largest customers can change from year to year. Our largest single customer in fiscal 2026 and fiscal 2025 was a prime defense contractor and accounted for 15% and 22% of our revenue, respectively. Our defense customers are engaged in the development, delivery and support of advanced defense and aerospace systems, including the U.S. Navy’s Virginia-class fast attack submarine program and the U.S. Navy’s Columbia-class ballistic missile submarine program. We also manufacture large flight-critical components on several high-profile commercial and military aircraft programs, including military helicopters. We historically have experienced, and continue to experience, customer concentration. A significant loss of business from our largest customer or a combination of several of our significant customers could result in lower operating profitability and/or operating losses if we are unable to replace such lost revenue from other sources. The revenue derived from all of our customers in the designated industry groups for the fiscal years ended March 31, 2026 and 2025 are displayed in the table below: *(dollars in thousands)* | ​ Revenue | ​ ​ ​ ​ ​ | ​ ​ 2026 Amount | ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent ​ | ​ ​ 2025 Amount | ​ ​ ​ ​ ​ ​ ​ Percent ​ | | --- | --- | ---: | --- | ---: | ---: | ---: | | Defense | ​ | $31,223 | ​ | 99% | $33,599 | 99% | | Precision Industrial | ​ | $421 | ​ | 1% | $432 | 1% | The following table displays revenue generated by individual customers in specific industry sectors that accounted for 10% or more of our revenue in fiscal 2026 and 2025: *(dollars in thousands)* | ​ Revenue | ​ ​ ​ ​ ​ | ​ ​ 2026 Amount | ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent ​ | ​ ​ 2025 Amount | ​ ​ ​ ​ | ​ ​ Percent ​ | | --- | --- | ---: | --- | ---: | ---: | --- | ---: | | Customer A | ​ | $3,570 | ​ | 11% | $5,795 | | 17% | | Customer B | ​ | $\* | ​ | \*% | $3,327 | | 10% | | Customer C | ​ | $4,733 | ​ | 15% | $4,947 | | 15% | | Customer D | ​ | $3,403 | ​ | 11% | $\* | | \*% | | Customer E | ​ | $4,756 | ​ | 15% | $7,671 | ​ | 22% | | Customer F | ​ | $\* | ​ | \*% | $5,003 | ​ | 15% | \* *Less than 10% of total* The following table depicts total revenue generated by the individual customers in the above table by segment that accounted for 10% or more of our revenue in fiscal 2026 and 2025: *(dollars in thousands)* | ​ Revenue | ​ ​ ​ ​ ​ | ​ ​ 2026 Amount | ​ ​ ​ ​ ​ ​ ​ Percent ​ ​ ​ | ​ ​ 2025 Amount | ​ ​ ​ ​ ​ ​ Percent | | --- | --- | ---: | ---: | ---: | ---: | | Ranor | ​ | $8,068 | 25% | $15,576 | 46% | | Stadco | ​ | $8,394 | 27% | $11,167 | 33% | On March 31, 2026, we had a backlog of orders totaling $52,198. We expect to deliver the backlog over the course of the next two to three fiscal years. The comparable backlog on March 31, 2025 was $48,625. ### Competition We face competition from both domestic and foreign entities in the manufacture of metal-fabricated and machined precision components and equipment. The industry in which we compete is fragmented with no one dominant player. We compete against companies that are both larger and smaller than us in size and capacity. Some competitors may be better known, have greater resources at their disposal, and have lower production costs. For certain products, being a domestic manufacturer may play a role in determining whether we are awarded a certain contract. For example, we face limited foreign competition for our defense products. For other products and markets, we may be competing against foreign manufacturers who have a lower cost of production. If a contracting party has a relationship with a vendor and is required to place a contract for bids, the preferred vendor may provide or assist in the development of the specification for the product which may be tailored to that vendor’s products. In such an event, we would be at a disadvantage in seeking to obtain that contract. We believe that customers focus on such factors as the quality of work, the reputation of the vendor, the perception of the vendor’s ability to meet the required schedule, and price in selecting a vendor for their products. We believe that our strengths in these areas allow us to compete effectively, and that as a result, we are one of a select group of companies that can provide the products and services we are able to provide. ### Government Regulations We provide a significant portion of our manufacturing services as a subcontractor to prime government contractors. Such prime government contractors are subject to government procurement and acquisition regulations which give the government the right to terminate these contracts for convenience, certain renegotiation rights, and rights of inspection. Any government action which affects our customers who are prime government contractors would affect us. Because of the nature and use of our products, we are subject to compliance with quality assurance programs, compliance with which is a condition for our ability to bid on government contracts and subcontracts. We believe we are in compliance with all of these programs. We are also subject to laws and regulations applicable to manufacturing operations, such as federal and state occupational health and safety laws, and environmental laws, which are discussed in more detail below under “*-Environmental Compliance.”* ### Environmental Compliance We are subject to U.S. federal, state and local environmental laws and regulations that pertain to the use, disposal and cleanup of substances regulated by those laws and the filing of reports with environmental agencies, and we are subject to periodic inspections to monitor our compliance. We believe that we are currently compliant with applicable environmental regulations. As part of our normal business practice, we are required to develop and file reports and maintain logbooks that document all environmental issues within our organization. We may engage outside consultants to assist us in keeping current on developments in environmental regulations. Expenditures for environmental compliance purposes during fiscal 2026 and 2025 were not material. ### Occupational Health and Safety Laws Our business and operations are subject to numerous federal, state, and local laws and regulations intended to protect our employees. Due to the nature of manufacturing, we are subject to substantial regulations related to safety in the workplace. In addition to the requirements of the state government of Massachusetts and California and the local governments having jurisdiction over our plants in those states, we must comply with federal health and safety regulations, the most significant of which are enforced by the Occupational Safety and Health Administration (“OSHA”). Further, our manufacturing and other business operations and facilities are subject to additional federal, state, or local laws or regulations including supply chain transparency, conflict minerals sourcing and disclosure, transportation and other laws or regulations relating to health and safety requirements, including COVID-19 safety and prevention. Our operations are also subject to federal, state, and local labor laws relating to employee privacy, wage and hour matters, overtime pay, harassment and discrimination, equal opportunity and employee leaves and benefits. We are also subject to existing and emerging federal and state laws relating to data security and privacy. It is our policy and practice to comply with all legal and regulatory requirements and our procedures and internal controls are designed to promote such compliance. Expenditures for compliance with occupational health and safety laws and regulations during fiscal 2026 and 2025 were not material. ### Intellectual Property Rights At present we have no registered intellectual property rights other than certain trademarks for our name and other business and marketing materials. Over the course of our business, we develop know-how for use in the manufacturing process. Although we have non-disclosure policies in place with respect to our personnel and in our contractual relationships, we cannot assure you that we will be able to protect our intellectual property rights with respect to this know-how. ### Human Capital Resources The success of our business depends in large part on our ability to attract, retain, and develop a workforce of skilled employees at all levels of our organization. We provide our employees with base wages and salaries that we believe are competitive and consistent with employee positions, and work with local, regional, and state-wide agencies to facilitate workforce hiring and development initiatives. As of March 31, 2026, we had 160 employees, all of whom are full-time employees. At Ranor and Stadco, 28 and 17 employees are salaried, and 64 and 51 employees are hourly, respectively. None of our employees are represented by a labor union. ### Available Information We maintain a website at techprecision.com. Information on our website is not incorporated by reference into this Annual Report on Form 10-K and does not constitute a part of this Annual Report on Form 10-K. We make available, free of charge, on our website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. These reports are also available at the SEC’s website at www.sec.gov. ## Risk factors As filed, 62,091 characters. Our business, results of operations and financial condition and the industry in which we operate are subject to various risks. We have listed below (not necessarily in order of importance or probability of occurrence) the most significant risk factors applicable to us, but they do not constitute all the risks that may be applicable to us. New risks may emerge from time to time, and it is not possible for us to predict all potential risks or to assess the likely impact of all risks. More information concerning certain of these risks is contained in other sections of this Annual Report on Form 10-K, including in “*Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.”* ### Risks Related to Our Business and Industry *Our auditors have indicated that there is substantial doubt about our ability to continue as a going concern.* Our liquidity is highly dependent on the availability of financing facilities and our ability to maintain a gross profit and operating income. The Company is the borrower under the amended and restated loan agreement dated as of August 25, 2021, as further amended, or the “Loan Agreement,” with Beacon Bank & Trust, successor by merger to Berkshire Bank, or the “Bank”. Under the Loan Agreement, the Bank continued to provide the Ranor Term Loan and the Stadco Term Loan (each as defined below) and the revolving line of credit, or the “Revolver Loan”. The Company has determined that it was not in compliance with the certain financial covenants in the Loan Agreement as of March 31, 2026. Additionally, our management believes it is probable that the Company will not be in compliance with certain financial covenants in future periods. Without a waiver, noncompliance with these financial and related covenants permits the lender to demand repayment in full of all outstanding amounts from the Company. In addition, the lender retains the right to act on covenant violations that occur after the date of delivery of any waiver. If the lender were to demand repayment, the Company would not be able to pay the obligation because the Company does not have existing facilities or sufficient cash on hand to satisfy these obligations. In order to satisfy the future financial covenants in the Loan Agreement, we must efficiently increase utilization of our manufacturing capacity at our Stadco subsidiary and improve the manufacturing process, such that our direct labor hours (inputs) allow us to recognize more revenue over time (outputs) and improve job performance. We plan to closely monitor our expenses and, if required, reduce operating costs and capital spending to enhance liquidity. There can be no assurance that we will be successful in these efforts. If we are unable to achieve compliance in the future with the financial covenants in the Loan Agreement by making operational changes to our business, then we might alternatively seek additional waivers or forbearances from our lender prior to any covenant violation or raise additional funds in one or more equity financing transactions. Any covenant waiver or forbearance may lead to increased costs, increased interest rates, additional restrictive covenants and the imposition of other lender protections that impact us negatively. There can be no assurance that we would be able to obtain waivers or forbearances in a timely manner, on acceptable terms, or at all. Alternatively, the terms of any equity financing may adversely affect the holdings or the rights of our stockholders and the issuance of additional securities by us, or the possibility of such issuance, may cause the market price of our common stock to decline. The sale of additional shares of our common stock, or securities convertible into shares of our common stock, would also dilute all of our stockholders. There was $7,031 outstanding under the Loan Agreement on March 31, 2026, and the lender under the Loan Agreement has agreed to extend the maturity date of the revolver loan to September 15, 2026. The original maturity date of the revolver loan under the loan agreement was December 20, 2023. While the maturity date of the revolver loan has been extended, it is due within the next 12 months and, if we are not able to renew or further extend the maturity date of the revolver loan, we will need to raise additional funds in order meet our obligations with respect to the revolver loan and sustain our operations. In addition to extending the maturity date of the revolver loan, the Company acknowledges that a certain event of default has occurred and is continuing under the Loan Agreement because of the Company’s failure to satisfy the Leverage Ratio (as defined in the Loan Agreement) as of March 31, 2026. The lender reserves any and all rights and remedies available to it under the Loan Agreement, including, without limitation, its right to choose to accelerate and demand the outstanding indebtedness evidenced by the loan documents, and to seek immediate repayment in full. In the event that the lender exercises its right to accelerate the repayment of this indebtedness as the result of one or more covenant breaches, or the maturity date of the revolver loan is not renewed or further extended, we do not expect to have funds available to repay these amounts in full unless we raise additional funds or find alternate financing, which, along with the uncertainty associated with the recurring operating losses at Stadco, raises substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements included in this Annual Report on Form 10-K are issued. The consequences of any default, waiver or forbearance, or the securing of additional equity financing could materially and adversely affect our business, financial condition, and results of operations. *We may pursue acquisitions and other strategic transactions and/or investments to complement or expand our business that may not be successful.* From time to time, we may explore opportunities to purchase or invest in other businesses or assets that we believe will complement, enhance or expand our current business or that might otherwise offer us growth opportunities, including opportunities that may differ from the Company’s current business. Any transactions that we are able to identify and complete may involve risks, including the commitment of significant capital, the incurrence of indebtedness, the payment of advances, the diversion of management’s attention and resources from our existing business to develop and integrate the acquired or combined business, the inability to successfully integrate such business or assets into our operations, litigation or other claims in connection with acquisitions or against companies we invest in or acquire, the risk of not achieving the intended results and the exposure to losses if the underlying transactions or ventures are not successful. Whether or not completed, the announcement and pendency of the potential acquisitions could cause disruptions in our business; and current and prospective employees may experience uncertainty about their future roles, which might adversely affect the ability to retain key employees; and uncertainty regarding the completion of the acquisition may cause customers, suppliers, distributors, vendors, strategic partners or others to delay or defer entering into contracts, make other decisions or seek to change or cancel existing business relationships; and the attention of management may be directed toward the completion of the acquisition. #### We face strong competition in our markets. We face competition from both domestic and foreign manufacturers in each of the markets we serve. No single company dominates the industry in which we operate. Our competitors include international, national, and local manufacturers, some of whom may have greater financial, manufacturing, marketing, and technical resources than we do, or greater penetration in or familiarity with a particular geographic market than we have. Some competitors may be better known or have greater resources at their disposal, and some may have lower production costs. For certain products, being a domestic manufacturer may play a role in determining whether we are awarded a certain contract. For other products, we may be competing against foreign manufacturers who have a lower cost of production. If a contracting party has a relationship with a vendor and is required to place a contract for bids, the preferred vendor may provide or assist in the development of the specification for the product which may be tailored to that vendor’s products. In such an event, we would be at a disadvantage in seeking to obtain that contract. We believe that customers focus on such factors as quality of work, reputation of the vendor, perception of the vendor’s ability to meet the required schedule, and price in selecting a vendor for their products. Some of our customers have moved manufacturing operations or product sourcing overseas. To remain competitive, we will need to invest continuously in our manufacturing capabilities and customer service, and we may need to reduce our prices, particularly with respect to customers in industries that are experiencing downturns, which may adversely affect our results of operations. We cannot provide assurance that we will be able to maintain our competitive position in each of the markets that we serve, and any failure by us to compete could have a material adverse effect on our business, financial condition and results of operations. *Because most of our contracts are individual purchase orders and not long-term agreements, there is no guarantee that we will be able to generate a similar amount of revenue in the future.* We must bid or negotiate each of our contracts separately, and when we complete a contract, there is generally no continuing source of revenue under that contract. As a result, we cannot assure you that we will have a continuing stream of revenue from any contract. Our failure to generate new business on an ongoing basis would materially impair our ability to operate profitably. Additionally, our reliance on individual purchase orders has historically caused, and may in future periods cause, our results of operations and cash flows to vary considerably and unpredictably from period to period. Because a significant portion of our revenue is derived from services rendered for the defense industry, our operating results may suffer from conditions affecting this sector, including any budgeting, economic or other trends that have the effect of reducing the requirements for our services. Labor shortages, government tariffs, and/or supply chain disruptions in the broader economy may also reduce demand for our products and services because of delays or disruptions in our customers’ ability to continue their own production, which could have a material adverse effect on our business, financial condition, or results of operation. *Our business may be impacted by external factors that we may not be able to control, including health emergencies like epidemics or pandemics, government tariffs, and geopolitical conflicts.* War, civil conflict, terrorism, natural disasters, and public health issues including domestic or international pandemics, have caused and could cause damage or disruption to domestic or international commerce by creating economic or political uncertainties. Additionally, volatility in the financial markets, government tariffs, and disruptions or downturns in other areas of the global or U.S. economies could negatively impact our business. These events could result in a decrease in demand for our products, make it difficult or impossible to deliver orders to customers or receive materials from suppliers, affect the availability or pricing of energy sources or result in other severe consequences that may or may not be predictable. As a result, our business, financial condition and results of operations could be materially adversely affected. We could also be negatively affected by health emergencies, including epidemics or pandemics. The effects of any such health emergency and related governmental responses could include extended disruptions to supply chains and capital markets, reduced labor availability and productivity and a prolonged reduction in demand for our services and overall global economic activity. This could result in the Company experiencing significant disruptions, which could have a material adverse effect on our results of operations, financial condition, and cash flows. To date, the company has not experienced any material effects from certain conflicts in the middle east and the war between Russia and Ukraine. However, because of our reliance on certain raw materials and energy supplies, an economic environment of rising government tariffs, costs and interest rates could have an unfavorable impact on our operations and financial condition. Additionally, events involving limited liquidity, defaults, non-performance or other adverse developments that affect banks, financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, may lead to market-wide liquidity problems, which could adversely impact our business, our business partners, or industry in ways that we cannot predict at this time. *Because of our dependence on a limited number of customers, our failure to generate major contracts from a small number of customers may impair our ability to operate profitably.* We have, in the past, been dependent each year on a small number of customers who generate a significant portion of our business, and these customers change from year to year. For the fiscal year ended March 31, 2026, our four largest customers accounted for 52% of our revenue. For the fiscal year ended March 31, 2025, our five largest customers accounted for 79% of our revenue. In addition, our backlog on March 31, 2026 and 2025 was $52,198 and $48,625, respectively, of which 75% and 73% was attributable to four customers. As a result, we may have difficulty operating profitably if there is a default in payment by any of our major customers, we lose an existing order, or we are unable to generate orders from new or existing customers. Furthermore, to the extent that any one customer accounts for a large percentage of our revenue, the loss of that customer could materially affect our ability to operate profitably. For example, our single largest customer for the fiscal years ended March 31, 2026 and 2025 accounted for 15% and 22%, respectively, of our revenue for both years. The loss of these customers could have a material adverse effect on our business and may impair our ability to operate profitably. We anticipate that our dependence on a limited number of customers in any given fiscal year will continue for the foreseeable future. There is always a risk that existing customers will elect not to do business with us in the future or will experience financial difficulties. If our customers experience financial difficulties or business reversals, or lose orders or anticipated orders, which would reduce or eliminate the need for the products which they ordered from us, they could be unable or unwilling to fulfill their contracts with us. There is also a risk that our customers will attempt to impose new or additional requirements on us that reduce the profitability of the orders placed by those customers with us. Further, even if the orders are not changed, these orders may not generate margins equal to our recent historical or targeted results. If we do not book more orders with existing customers, or develop relationships with new customers, we may not be able to increase, or even maintain, our current level of revenue, which could have an adverse effect on our financial condition and results of operations. *Our backlog figures may not accurately predict future revenue or recognizable revenue.* We expect to fill most items of backlog within the next three years. However, because orders may be rescheduled or canceled and a significant portion of our revenue is derived from a small number of customers, backlog is not necessarily indicative of future revenue levels. Moreover, we cannot be sure of when during the future 36-month period we will be able to recognize revenue corresponding to our backlog nor can we be certain that revenues corresponding to our backlog will not fall into periods beyond the 36-month horizon. *Any decrease in the availability or increase in the cost of raw materials could materially affect our earnings.* The availability of certain critical raw materials, such as steel, nickel, monel, inconel, aluminum, stainless steel, and other alloys, is subject to factors that are not within our control. At any given time, we may be unable to obtain an adequate supply of these critical raw materials on a timely basis, at prices and other terms acceptable to us, or at all. If suppliers increase the price of critical raw materials or are unwilling or unable to meet our demand, we may not have alternative sources of supply. In addition, to the extent that we have existing contracts or have quoted prices to customers and accepted customer orders for products prior to purchasing the necessary raw materials, we may be unable to raise the price of products to cover all or part of the increased cost of the raw materials. The manufacture of some of our products is a complex process and requires long lead time. As a result, we may experience delays or shortages in the supply of raw materials. If we are unable to obtain adequate and timely deliveries of the required raw materials, we may be unable to complete our manufacturing projects and deliver finished products on a timely basis. This could cause us to lose revenue, incur additional costs, delay new product introductions, or suffer harm to our reputation. In addition, costs of certain critical raw materials have been volatile due to factors beyond our control. Raw material costs are included in our contracts with customers, but in some cases, we are exposed to changes in raw material costs from the time purchase orders are placed to when we purchase the raw materials for production. Changes in business conditions could adversely affect our ability to recover rapid increases in raw material costs and may adversely affect our results of operations. Additionally, changes in international trade duties and other aspects of international trade policy, both in the U.S. and abroad, could materially impact the cost of raw materials. For example, as of early 2026, the U.S. imposed a 50% tariff under Section 232 of the Trade Expansion Act of 1962, as amended, on steel and aluminum products imported into the U.S., with certain exceptions. Subsequent changes to tariffs announced by the U.S. could further impact steel and aluminum costs and decrease supply availability. In response to the invasion of Ukraine by the military forces of the Russian Federation, the United States, the European Union and other jurisdictions have imposed sanctions that, among other things, prohibit the importation of a wide array of commodities and products from Russia, which is a major global supplier of nickel. Any increase in nickel, steel and/or aluminum prices that is not offset by an increase in our prices could have an adverse effect on our business, financial position, results of operations or cash flows. In addition, if we are unable to acquire timely nickel, steel or aluminum supplies, we may need to decline bid and order opportunities, which could also have an adverse effect on our business, financial position, results of operations or cash flows. *All our manufacturing and production is done at two locations, in California and Massachusetts. We may be exposed to significant disruption to our business because of unforeseeable developments at either geographic location.* We operate at two manufacturing and production facilities, one in Westminster, Massachusetts and the other in Los Angeles, California. It is possible that we could experience prolonged periods of reduced production due to unforeseen catastrophic events occurring in or around our manufacturing and production facilities. It is also possible that operations could be disrupted due to other unforeseen circumstances such as power outages, explosions, fires (including wildfires), floods, earthquakes, accidents, and severe weather conditions. As a result, we may be unable to shift manufacturing capabilities to alternate locations, accept materials from suppliers, meet customer shipment needs or address other severe consequences that may be encountered, and we may suffer damage to our reputation. Our financial condition and results of our operations could be materially adversely affected were such events occurred. *Our manufacturing processes are complex, must constantly be upgraded to remain competitive and depend upon critical, high-cost equipment that may require costly repair or replacement.* It is possible that we could experience prolonged periods of reduced production due to unplanned equipment failures, and we could incur significant repair or replacement costs in the event of those failures. We must make regular capital investments and changes to our manufacturing processes to lower production costs, improve productivity, manufacture new or improved products and remain competitive. We may not be able to take advantage of business opportunities or respond to competitive pressures if we fail to update, replace or make additions to our equipment or our manufacturing processes in a timely manner. The cost of repairing or replacing much of our equipment or facilities could be significant. We cannot be certain that we will have sufficient internally generated cash or acceptable external financing to make necessary capital expenditures in the future. *Our production facilities are energy-intensive, and we rely on third parties to supply energy consumed at our production facilities.* The prices for and availability of electricity, natural gas, oil, and other energy resources are subject to volatile market conditions. These market conditions often are affected by political and economic factors beyond our control, including the imposition of sanctions on certain countries from selling significant sources of oil and natural gas into key international markets, which can impact the global price of these commodities. Disruptions or lack of availability in the supply of energy resources could temporarily impair our ability to operate our production facility. Further, increases in energy costs, or changes in costs relative to energy costs paid by competitors, may adversely affect our profitability. To the extent that these uncertainties cause suppliers and customers to be more cost sensitive, increased energy prices may have an adverse effect on our results of operations and financial condition. *The dangers inherent in our operations and the limits on insurance coverage could expose us to potentially significant liability costs and materially interfere with the performance of our operations.* The fabrication of large steel structures involves potential operating hazards that can cause personal injury or loss of life, severe damage to and destruction of property and equipment and suspension of operations. The failure of such structures during and after installation can result in similar injuries and damage. Although we believe that our insurance coverage is adequate, there can be no assurance that we will be able to maintain adequate insurance in the future at rates we consider reasonable or that our insurance coverage will be adequate to cover future claims that may arise. Claims for which we are not fully insured may adversely affect our working capital and profitability. In addition, changes in the insurance industry have generally led to higher insurance costs and decreased availability of coverage. The availability of insurance that covers risks we and our competitors typically insure against may decrease, and the insurance that we are able to obtain may have higher deductibles, higher premiums, and more restrictive policy terms. *Our operating results may fluctuate significantly from quarter to quarter, and we cannot be certain that we will maintain profitability in every quarterly reporting period.* Our operating results historically have been difficult to predict and have at times significantly fluctuated from quarter to quarter due to a variety of factors, many of which are outside of our control. Among these factors includes the fact that most of our contracts are individual purchase orders and not long-term agreements. Additionally, our ability to meet project completion schedules for an individual project and record the corresponding revenue over-time can fluctuate and cause significant changes in our revenue and other financial results. As a result of these factors, comparing our operating results on a period-to-period basis may not be meaningful, and you should not rely on our past results as an indication of our future performance. Our operating expenses do not always vary directly with revenue and may be difficult to adjust in the short term. As a result, if revenue for a particular quarter is below our expectations, we may not be able to proportionately reduce operating expenses for that quarter, and therefore such a revenue shortfall would have a disproportionate effect on our operating results for that quarter. *We recognize revenue for our defense contracts and some commercial contracts over-time under Accounting Standards Codification (ASC) 606 which requires significant management judgement. Errors made to estimates of revenue and costs could result in overstated or understated profits or losses, subject to adjustment.* For most of our defense industry contracts, we recognize revenue over time as we perform services or deliver goods. In situations where control transfers or services are performed over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We recognize revenue over time based on the transfer of control of the promised goods or services to the customer, or at a point in time. This transfer will occur over time when the Company’s performance does not create an asset that has an alternative use to the Company, and we have an enforceable right to payment for performance completed to date. Otherwise, control to the promised goods or services transfers to customers at a point in time. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor, and subcontracting costs, as well as an allocation of indirect costs. We are required to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization of revenue over time. Contract modifications - as well as other changes in estimates of revenue, costs, and profits on performance obligations - are recognized using the cumulative catch-up method of accounting. This method recognizes in the current period the cumulative effect of the changes in current and prior periods. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated or understated, and the profits or loss reported could be subject to adjustment. If our revenues and costs require adjustment, our stock price could decline. *Demand in our end-use markets can be cyclical, impacting on the demand for the products we produce.* Demand in our end-use markets, including companies in the defense and precision industrial sectors, can be cyclical in nature and sensitive to general economic conditions, competitive influences, and fluctuations in inventory levels throughout the supply chain. Our revenue is sensitive to the market conditions present in the industries in which the ultimate consumers of our products operate, which in some cases have been highly cyclical and subject to substantial downturns. As a result of the cyclical nature of these markets, we have experienced, and in the future, we may experience significant fluctuations in our revenue and results of operations with respect to a substantial portion of our total product offering, and such fluctuations could be material and adverse to our overall financial condition, results of operations and liquidity. #### We could be adversely affected by reductions in defense spending. Because certain of our products are used in a variety of military applications, including ships, submarines and helicopters, we derive most of our revenue from the defense industry. In fiscal 2026 and 2025, approximately 99% of our revenue in both years were derived from customers in the defense industry. Although many of the programs under which we sell products to prime U.S. government contractors extend several years, they are subject to annual funding through congressional appropriations. While spending authorizations for defense-related programs by the U.S. government have increased since 2020 due to inflation, technology development, and geopolitical conflicts abroad, these spending levels may not be sustainable and could significantly decline. Future levels of expenditures, authorizations, and appropriations for programs we support may decrease or shift to programs in areas where we do not currently provide services. Changes in spending authorizations, appropriations, and budgetary priorities could also occur due to a shift in the number, and intensity, of potential and ongoing conflicts, the rapid growth of the federal budget deficit, increasing political pressure to reduce overall levels of government spending, shifts in spending priorities from national defense as a result of competing demands for federal funds, or other factors. It is also possible that recent geopolitical conflicts abroad causes a reorientation of U.S. defense spending away from the naval submarine programs from which we derive substantial portions of our revenue towards land-based military projects, which could involve fewer programs in which our products would be needed. Our business prospects, financial condition or operating results could be materially harmed among other causes by the following: 1) budgetary constraints affecting U.S. government spending generally, or specific departments or agencies in particular, and changes in available funding, such as federal government sequestration (automatic spending cuts); 2) changes in U.S. government programs or requirements; and 3) a prolonged U.S. government shutdown and other potential delays in the appropriations process. *Failure to obtain and retain skilled technical personnel could adversely affect our operations.* Our production facilities require skilled personnel to operate and provide technical services and support for our business. Competition for the personnel required for our business intensifies as activity increases. In periods of high utilization, it may become more difficult to find and retain qualified individuals, and there can be no assurance that we will be successful in attracting and retaining qualified personnel to fulfill our current or future needs. This could increase our costs or have other adverse effects on our results of operations. *The extensive environmental, health and safety regulatory regimes applicable to our manufacturing operations create potential exposure to significant liabilities.* The nature of our manufacturing business subjects our operations to numerous and varied federal, state, local and international laws and regulations relating to pollution, protection of public health and the environment, natural resource damage and occupational safety and health. Failure to comply with these laws and regulations, or with the permits required for our operations, could result in fines or civil or criminal sanctions, third party claims for property damage or personal injury, and investigation and cleanup costs. Potentially significant expenditures could be required to comply with environmental laws that may be adopted or imposed in the future. We have used, and currently use, certain substances that are considered hazardous, extremely hazardous or toxic under worker safety and health laws and regulations. Although we implement controls and procedures designed to reduce continuing risk of adverse impacts and health and safety issues, we could incur substantial cleanup costs, fines and civil or criminal sanctions, and third-party property damage or personal injury claims because of violations, non-compliance or liabilities under these regulatory regimes. As a manufacturing business, we also must comply with federal and state environmental laws and regulations which relate to the manner in which we store and dispose of materials and the reports that we are required to file. We cannot assure you that we will not incur additional costs to maintain compliance with environmental laws and regulations or that we will not incur significant penalties for failure to be in compliance any of which could have a material adverse effect on our business, financial condition and results of operations. *Our systems and information technology infrastructure may be subject to security breaches and other cybersecurity incidents.* We rely on the accuracy, capacity, and security of our information technology systems to obtain, process, analyze, and manage data, as well as to facilitate the manufacture and distribution of products to and from our facility. We receive, process and ship orders, manage the billing of and collections from our customers, and manage the accounting for and payment to our vendors. Maintaining the security of computers, computer networks, and data storage resources is a critical issue for us and our customers, as security breaches could result in vulnerabilities and loss of and/or unauthorized access to confidential information. We may face attempts by experienced hackers, cybercriminals, hostile nation-state actors, or others with authorized access to our systems to misappropriate our proprietary information and technology, interrupt our business, and/or gain unauthorized access to confidential information. The reliability and security of our information technology infrastructure and software, and our ability to expand and continually update technologies in response to our changing needs is critical to our business. To the extent that any disruptions or security breaches result in a loss or damage to our data, it could cause harm to our reputation. This could lead some customers to stop using us for building their products and reduce or delay future purchases of our products or use competing products. In addition, we could face enforcement actions by U.S. states, the U.S. federal government, or foreign governments, which could result in fines, penalties, and/or other liabilities and which may cause us to incur legal fees and costs, and/or additional costs associated with responding to the cyberattack. Increased regulation regarding cybersecurity may increase our costs of compliance, including fines and penalties, as well as costs of cybersecurity audits. Any of these actions could have a material adverse impact on our business, financial condition and the results of operations. *We are subject to regulations related to conflict minerals which could adversely impact our business.* We are subject to SEC rules regarding the disclosure of the use of tin, tantalum, tungsten, gold and certain other minerals, known as conflict minerals, in products manufactured by public companies. These rules require that public companies conduct due diligence to determine whether such minerals originated from the Democratic Republic of Congo, or the DRC, or an adjoining country and whether such minerals helped finance the armed conflict in the DRC. These rules require ongoing due diligence efforts, along with annual conflict minerals reports. There are costs associated with complying with these disclosure requirements, including costs to determine the origin of conflict minerals used in our products. In addition, these rules could adversely affect the sourcing, supply and pricing of materials used in our products. As there may be only a limited number of suppliers offering conflict-free minerals, we cannot be sure that we will be able to obtain necessary conflict minerals from such suppliers in sufficient quantities or at competitive prices. Also, we may face reputational challenges if the due diligence procedures we implement do not enable us to verify the origins for all conflict minerals or to determine that such minerals are DRC conflict-free. We may also encounter challenges satisfying customers that may require all of the components of products purchased to be certified as DRC conflict-free because our supply chain is complex. If we are not able to meet customer requirements, customers may choose to disqualify us as a supplier. We currently do not use any conflict minerals in the production of our products, but from time to time we may receive a customer order necessitating the use of conflict minerals. In the event we produce any products utilizing conflict minerals, we will be required to comply with the rules discussed above. *Changes in delivery schedules and order specifications may affect our revenue stream.* Although we provide manufacturing services pursuant to orders placed by our customers, we have in the past experienced delays in scheduling and changes in the specification of our products. Delays in scheduling have been and, in the future, may be caused by disruptions relating to epidemics, pandemics and government-imposed lockdowns, or economy-wide supply chain disruptions, while changes in order specifications may result from several factors, including a determination by the customer that the product specifications need to be changed after receipt of an initial product or prototype. As a result of these changes, we may suffer a delay in the recognition of revenue from projects and may incur contract losses. We cannot assure you that our results of operations will not be affected in the future by delays or changes in specifications or that we will ever be able to recover revenue which was lost as a result of the delays or changes. Further, if we cannot allocate our personnel to a different project, we will continue to incur expenses relating to the initial project, including labor and overhead. Thus, if orders are postponed, our results of operations would be impacted by our need to maintain staffing and other expense-generating aspects of production for the postponed projects, even though they were not fully utilized, and revenue associated with the project will not be recognized during this period. We cannot assure you that our operating results will not decline in future periods because of changes in customers’ orders. *Negative economic conditions may impact the demand for our services and the ability of our customers to meet their obligations with us on a timely basis. Any disputes with customers could also have an adverse impact on our income and cash flow.* Negative economic conditions, including tightening of credit in financial markets as a result of increases in interest rates and/or instability in the banking system, may lead businesses to postpone spending, which may impact our customers, causing them to cancel, decrease or delay their existing and future orders with us. Declines in economic conditions may further impact the ability of our customers to meet their obligations to us on a timely basis. If customers are unable to meet their obligations to us on a timely basis, it could adversely impact the realization of receivables, the valuation of inventories and the valuation of long-lived assets. Additionally, we may be negatively affected by contractual disputes with customers, which could have an adverse impact on our financial condition and the results of operations. *If our customers successfully assert product liability claims against us due to defects in our products, our operating results may suffer, and our reputation may be harmed.* Due to the circumstances under which many of our products are used and the fact that some of our products are relied upon by our customers in their facilities or operations, we face an inherent risk of exposure to claims in the event that the failure, use or misuse of our products results, or is alleged to result, in bodily injury, property damage or economic loss. We have been subject to product liability claims in the past, and we may be subject to claims in the future. A successful product liability claim or series of claims against us, or a significant warranty claim or series of claims against us could materially decrease our liquidity and adversely affect our financial condition and results of operations. *We maintain a substantial amount of outstanding indebtedness, which could impair our ability to operate our business and react to changes in our business, remain in compliance with debt covenants and make payments on our debt.* Our level of indebtedness could have important consequences, including, without limitation: - increasing our vulnerability to general economic and industry conditions because our debt payment obligations may limit our ability to use our cash to respond to or defend against changes in the industry or the economy; - requiring a substantial portion of our cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities; - limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; - limiting our ability to pursue our growth strategy, including restricting us from making strategic acquisitions or causing us to make non-strategic divestitures; - placing us at a disadvantage compared to our competitors who are less leveraged and may be better able to use their cash flow to fund competitive responses to changing industry, market or economic conditions; and - making us more vulnerable in the event of a downturn in our business, our industry, or the economy in general. Because certain of our borrowing facilities contain variable interest rate provisions, many of the above consequences could be worsened if interest rates were to increase. In addition, our current credit facilities contain, and any future credit facilities to which we become a party will likely contain, covenants and other provisions that restrict our operations. These restrictive covenants and provisions could limit our ability to obtain future financing, make needed capital expenditures, withstand a future downturn in our business, or the economy in general, or otherwise conduct necessary corporate activities, and may prevent us from taking advantage of business opportunities that arise in the future. *If we refinance our credit facilities, we cannot guarantee that any new credit facility will not contain similar covenants and restrictions.* Our liquidity is highly dependent on our available financing facilities and ability to improve our gross profit and operating income. Our failure to obtain new or additional financing, if required, could impair our ability to both serve our existing customer base and develop new customers and could result in our failure to continue to operate as a going concern. To the extent that we require new or additional financing, we cannot assure you that we will be able to get such financing on terms equal to or better than the terms of our current credit facilities with the Bank. If we are unable to borrow funds under an existing credit facility, it may be necessary for us to conduct an offering of debt and/or equity securities on terms which may be disadvantageous to us or have a negative impact on our outstanding securities and the holders of such securities. In the event of an equity offering, it may be necessary that we offer such securities at a price that is significantly below our current trading levels which may result in substantial dilution to our investors that do not participate in the offering and a new lower trading level for our common stock. *We may need new or additional financing in the future to expand our business or refinance existing indebtedness, and our inability to obtain capital on satisfactory terms or at all may have an adverse impact on our operations and our financial results.* We may need new or additional financing in the future to expand our business, refinance existing indebtedness or make strategic acquisitions, and our inability to obtain capital on satisfactory terms or at all may have an adverse impact on our operations, financial condition, or results of operations. As we grow our business, we may have to incur significant capital expenditures. We may make capital investments to, among other things, build new or upgrade our existing facilities, purchase or lease new equipment and enhance our production processes. If we are unable to access capital on satisfactory terms and conditions, we may not be able to expand our business or meet our payment requirements under our existing credit facilities. Our ability to obtain new or additional financing will depend on a variety of factors, many of which are beyond our control. We may not be able to obtain new or additional financing because we may have substantial debt, our current receivable and inventory balances may not support additional debt availability or because we may not have sufficient cash flows to service or repay our existing or future debt. In addition, depending on market conditions and our financial performance, equity financing may not be available on satisfactory terms or at all. Moreover, if we raise additional funds through issuances of equity or convertible debt securities, our current stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our common stock. If we are unable to access capital on satisfactory terms and conditions, this could have an adverse impact on our business, results of operations and financial condition. *Any deterioration or disruption of the credit and capital markets may adversely affect our access to sources of funding.* Disruptions in the credit markets can cause severely restricted access to capital for companies. When credit markets deteriorate or are disrupted, our ability to incur additional indebtedness to fund a portion of our working capital needs and other general corporate purposes, or to refinance maturing obligations as they become due, may be constrained. This risk could be exacerbated by future deterioration in the Company’s credit ratings. In addition, if the counterparty backing our existing credit facilities were unable to perform on its commitments, our liquidity could be impacted, which could adversely affect funding of working capital requirements and other general corporate purposes. In the event we need to access the capital markets or other sources of financing, there can be no assurance that we will be able to obtain financing on acceptable terms or within an acceptable time, if at all. In addition, geopolitical conflicts, high inflation and increasing interest rates have significantly disrupted world financial markets, increased volatility in U.S. capital markets, and may reduce opportunities for us to seek additional funding. Our inability to obtain financing on terms and within a time acceptable to us could have an adverse impact on our results of operations, financial condition, and liquidity. ### Risks Related to our Common Stock *If we fail to maintain compliance with The Nasdaq Stock Market’s listing standards, our common stock could be delisted from Nasdaq.* As a listed Nasdaq Stock Market (“Nasdaq”) company, we are subject to rules covering, among other things, certain major corporate transactions, the composition of our board of directors and committees thereof, the minimum bid price of our common stock and minimum stockholders’ equity. Nasdaq also has rules governing the timely filing of periodic reports. We have failed in the past to comply with the Nasdaq requirement to timely file our periodic financial reports with respect to some of our previous annual reports on Form 10-K and quarterly reports on Form 10-Q and there can be no guarantee that we will continue to make timely filings of our subsequent periodic financial reports with the SEC. The failure to meet any Nasdaq requirements may result in the delisting of our common stock from Nasdaq, which could adversely affect the liquidity and market price of our common stock. If our common stock were to be delisted, selling shares of our common stock could be more difficult because smaller quantities of shares would likely be bought and sold, transactions could be delayed, and security analysts’ coverage of us may be reduced. In addition, in the event our common stock is delisted, broker-dealers have certain regulatory requirements imposed upon them, which may discourage broker-dealers from effecting transactions in our common stock, further limiting the liquidity thereof. These factors could result in lower prices for shares of our common stock and/or limit an investor’s ability to execute a transaction. In addition, delisting from Nasdaq could also impair our ability to raise additional necessary capital through equity or debt financing, and could lead to significant dilution to our stockholders caused by our issuing equity in financing or other transactions at a price per share significantly below the then market price. #### Our stock price may fluctuate significantly. The stock market can experience significant volatility, and the volatility of stocks often does not relate to the operating performance of the companies represented by the stock. The market price of our common stock could be subject to significant fluctuations because of general market conditions and because of factors specifically related to our business. Factors that could cause volatility in the market price of our common stock include market conditions affecting our customers’ businesses, including the level of mergers and acquisitions activity, anticipated changes in spending on national defense by the U.S. Government, and actual and anticipated fluctuations in our quarterly operating results, rumors relating to us or our competitors, actions of stockholders, including sales of shares by our directors and executive officers, additions or departures of key personnel, and developments concerning current or future strategic alliances or acquisitions. Volatility in our stock price may also be enhanced by the fact that our common stock is often thinly traded. Additionally, the economic and other consequences of the past instability with regional banks, geopolitical conflict, high inflation, government tariffs and increasing interest rates have resulted in significant volatility in the equity capital markets. These and other factors may cause the market price and demand for our common stock to fluctuate substantially, which may limit or prevent investors from readily selling their shares of common stock at a profit and may otherwise negatively affect the liquidity of our common stock. In addition, in the past, when the market price of a stock has been volatile, holders of that stock have instituted securities class action litigation against the company that issued the stock. If any of our stockholders brought a lawsuit against us, even if the lawsuit is without merit, we could incur substantial costs by defending the lawsuit. Such a lawsuit could also divert the time and attention of our management. *The issuance of shares of our common stock as compensation may dilute the value of existing stockholders and may affect the market price of our stock.* We may use, and have in the past used, stock options, stock grants and other equity-based incentives to provide motivation and compensation to our directors, officers, employees and key independent consultants. The award of any such incentives will result in immediate and potentially substantial dilution to our existing stockholders and could result in a decline in the value of our stock price. The exercise of these options and the sale of stock issued upon such exercise or pursuant to stock grants may have an adverse effect upon the price of our stock. *The number of shares of common stock we have registered for resale is significant in relation to the number of our outstanding shares of common stock.* We have filed registration statements with the SEC to register the resale of shares of our common stock into the public market by certain stockholders (including some of our directors) that acquired shares of our common stock in transactions not registered under the Securities Act, including shares underlying warrant to purchase our common stock. These shares represent a significant number of shares of our total number of issued and outstanding shares of common stock. The resale by these stockholders of a significant number of these shares, or the perception in the public markets that such selling securityholders may sell all or a portion of such securities, could depress the market price of our Common Stock during the period the applicable registration statement remains effective. *The trading volume of our common stock has fluctuated from time to time and is typically low, which may make it difficult for investors to sell their shares at times and prices that investors feel is appropriate.* To date, the trading volume of our common stock has fluctuated, and there is typically a low volume of trading in our common stock. Generally, lower trading volumes adversely affect the liquidity of our common stock, not only in terms of the number of shares that can be bought and sold at a given price, but also through delays in the timing of transactions and reduction in security analysts’ and the media’s coverage of us. This may result in lower prices for our common stock than might otherwise be obtained and could also result in a larger spread between the bid and asked prices for our common stock. *Because of our cash requirements and restrictions in our debt agreements, we may be unable to pay dividends.* In view of the cash requirements of our business, we expect to use any cash flow generated by our business to finance our operations and growth and to service our indebtedness. Further, we are subject to certain affirmative and negative covenants under our debt agreements which restrict our ability to declare or pay any dividend or other distribution on equity, purchase or retire any equity, or alter our capital structure. Accordingly, any return to stockholders will be limited to the appreciation of the value of their holdings of our stock. *The rights of the holders of our common stock may be impaired by the potential issuance of preferred stock.* Our certificate of incorporation gives our board of directors the right to create a new series of preferred stock. As a result, the board of directors may, without stockholder approval, issue preferred stock with voting, dividend, conversion, liquidation, or other rights that are superior to the rights associated with our common stock, which could adversely affect the voting power and equity interest of the holders of our common stock. Preferred stock, which could be issued with the right to more than one vote per share, could be utilized as a method of discouraging, delaying, or preventing a change of control. The possible impact on takeover attempts could adversely affect the price of our common stock. ### General Risk Factors *If securities analysts do not publish research or reports about our business, if they issue unfavorable commentary or downgrade their rating on our common stock, or if we fail to meet projections and estimates of earnings developed by such analysts, the price of our common stock could decline.* The trading market for our common stock relies in part on the research and reports that securities analysts publish about us and our business. The price of our common stock could decline if one or more analysts downgrade their rating on our common stock or if those analysts issue other unfavorable commentary or cease publishing reports about us or our business. In addition, although we do not make projections relating to our future operating results, our operating results may fall below the expectations of securities analysts and investors. In this event, the market price of our common stock would likely be adversely affected. *We have identified certain material weaknesses in our internal control over financial reporting, resulting from control deficiencies related to 1) an insufficient complement of Stadco accounting staff necessary to consistently perform management review controls over financial information and complete account reconciliations on a timely basis to ensure all transactions were accurately captured and recorded, 2) initial purchase accounting and fair value accounting associated with the Stadco acquisition, and 3) adjustments related to tax accounting for a deficient analysis of the valuation allowance. If we fail to maintain effective internal controls over financial reporting, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our ability to operate our business and investors’ views of us.* We are subject to the Sarbanes-Oxley Act, which requires public companies to include in their annual report a statement of management’s responsibilities for establishing and maintaining adequate internal control over financial reporting, together with an assessment of the effectiveness of those internal controls. Ensuring that we have effective internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be re-evaluated frequently. Our failure to maintain the effectiveness of our internal controls in accordance with the requirements of the Sarbanes-Oxley Act could have a material adverse effect on our business. We could lose investor confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on the price of our common stock and could result in us being the subject of regulatory scrutiny. During the evaluation and testing process of our internal controls, if we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal controls over financial reporting are effective. For example, in connection with the audit of our financial statements, we identified certain material weaknesses in our internal control over financial reporting. The material weaknesses we identified pertain to (i) initial purchase accounting and the continuing fair value accounting associated with our acquisition of Stadco, (ii) we did not maintain a sufficient complement resources and expertise on the Stadco accounting staff necessary to consistently perform management review controls over financial information and complete account reconciliations on a timely basis to ensure all transactions were accurately captured and recorded prior to closing the books, (iii) the accounting for the impairment of long-lived assets, and (iv) the segregation of duties among people and processes to mitigate risk and meet financial reporting objectives. See “—*Material Weaknesses”* and “—*Management’s Remediation Plan”* in the section titled “*Item 9A. Controls and Procedures”* for more details concerning these material weaknesses. While we have taken steps to enhance our internal control environment, we continue to address the underlying cause of the material weaknesses with a review of our internal controls, and may propose additional new controls, including those designed to raise the level of precision of management review controls to gain additional assurance regarding the timely completion of our quality control procedures. Except for tax accounting, the steps we have taken to date were not sufficient to remediate all material weaknesses or to avoid the identification of other material weaknesses in the future. We cannot assure you that the measures we have taken to date, and are continuing to implement, will be sufficient to avoid additional material weaknesses or significant deficiencies in our internal control over financial reporting in the future. If we are unable to conclude that our internal control over financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of shares of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. ## Cybersecurity As filed, 2,774 characters. #### Cybersecurity Risk Management and Strategy We have processes in place to assess, identify, and manage material risks from cybersecurity threats. We and our subsidiaries currently rely heavily on products and services provided by third-party suppliers to operate certain critical business systems, including without limitation, cloud-based infrastructure, encryption and authentication technology, email, and other functions. Our IT staff along with the third-party providers and outsourced IT services monitor and address cybersecurity-related risks, including installing software for threat protection and malware. Our IT staff and such third-party providers are tasked with notifying management of any material risks or cybersecurity concerns that they identify, which management then assesses and may bring to our board of directors to discuss if deemed necessary or appropriate. We continue to work with outside counsel and third - party service providers to further develop our expertise, processes and procedures with respect to cybersecurity protection and our response plan. To date, we have not (to our knowledge) encountered cybersecurity challenges that have materially impaired our operations or financial standing. For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “*Risk Factors,”* in this Report. We maintain a cyber liability insurance policy. However, our cyber liability insurance policy may not cover all claims made against us, and defending a suit, regardless of its merit, could be costly and divert management’s attention from our business and operations. #### Governance Our Chief Executive Officer is primarily responsible for assessing and managing our strategic risk exposures, including material risks from cybersecurity threats, with assistance from our IT staff and third-party service providers. Our IT staff at both Ranor and Stadco oversee their respective cybersecurity processes on a day-to-day basis, including those described under the heading “Cybersecurity Risk Management and Strategy” above, and escalate matters to our Chief Executive Officer as appropriate. Our audit committee is tasked with general oversight of our risk management process, including risks from cybersecurity threats. Our Chief Executive Officer provides periodic briefings to the audit committee of our board of directors regarding our cybersecurity risks and activities, including any recent cybersecurity incidents and related responses, cybersecurity systems testing, activities of third parties, and the like. In furtherance thereof, the committee is responsible for monitoring and assessing strategic risk exposure. Our audit committee provides regular updates to the board of directors on such reports. ## Properties As filed, 1,794 characters. We own approximately 145,000 square feet of office and manufacturing space under roof, situated on approximately 65 acres in Westminster, Massachusetts that is used by our Ranor reportable segment. We believe that our current facilities in Westminster are adequate for our present operational requirements, with room for limited expansion. The manufacturing facilities include a fabrication plant and a machining plant, providing custom solutions through our core competencies in manufacturing engineering, materials management and traceability, fabrication, machining, assembly and testing, finishing and coating, and packaging. Our capabilities include 100+ ton crane capacity, 35 feet under hook, weld positioners up to 50-ton, 400+ approved weld procedures, multiple weld cells, stress relief ovens, blast rooms, and multiple precision machining centers. Our loans from the Bank are secured by a first lien on all personal and real property of Ranor, including our space in Westminster, Massachusetts. We lease approximately 183,000 square feet of office and manufacturing space under roof, situated on approximately 5 acres in Los Angeles, California that is used by our Stadco reportable segment. Tooling capabilities include large-scale, high-precision, complex geometry invar, steel, and aluminum tools, molds, jigs and dies to support composite part manufacturers. Stadco can provide concurrent engineering, materials and process research, numerical control programming, fabrication and machining, planning and inspection, and final assembly. Our capabilities include 50+ ton crane capacity, CNC machining up to 65 feet, and one of the largest electron beam weld chambers in North America. Our loan from the Bank is secured by a first lien on all personal and real property of Stadco. ## Legal proceedings As filed, 438 characters. We may from time to time be subject to various legal or administrative claims and proceedings arising in the ordinary course of business. As of the date hereof, we are not a party to any material legal or administrative proceedings. Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention. ## Management's discussion and analysis As filed, 47,073 characters. ### (dollars in thousands, except per share data) ### Statement Regarding Forward Looking Disclosure The following discussion of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and the related notes, which appear elsewhere in this Annual Report on Form 10-K. This Annual Report on Form 10-K, including this section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” may contain predictive or “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of current or historical fact contained in this annual report, including statements that express our intentions, plans, objectives, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events, or conditions are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will,” “should,” “would” and similar expressions, as they relate to us, are intended to identify forward-looking statements. These forward-looking statements are based on current expectations, estimates and projections made by management about our business, our industry and other conditions affecting our financial condition, results of operations or business prospects. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in, or implied by, the forward-looking statements due to numerous risks and uncertainties. As discussed below under “*Liquidity, Capital Resources, and Going Concern”,* certain events and conditions, when examined in the aggregate, indicate substantial doubt about our ability to continue as a going concern for at least one year beyond the date of the financial statements. Factors that could cause such outcomes and results to differ include, but are not limited to, risks and uncertainties arising from: - our reliance on individual purchase orders, rather than long-term contracts, to generate revenue; - our ability to balance the composition of our revenues and effectively control operating expenses; - external factors that may be outside of our control, including health emergencies, like epidemics or pandemics, geopolitical conflicts, price inflation, increasing interest rates, and supply-chain disruptions; - the availability of appropriate financing facilities impacting our operations, financial condition and/or liquidity; - our ability to receive contract awards through competitive bidding processes; - our ability to maintain standards to enable us to manufacture products to exacting specifications; - our ability to enter new markets for our services; - our reliance on a small number of customers for a significant percentage of our business; - competitive pressures in the markets we serve; - changes in the availability or cost of raw materials and energy for our production facilities; - restrictions on our ability to operate our business due to our outstanding indebtedness; - government tariffs, regulations and requirements; - pricing and business development difficulties; - changes in government spending on national defense; - our ability to make acquisitions and successfully integrate those acquisitions with our business; - our failure to maintain effective internal controls over financial reporting; - general industry and market conditions and growth rates, and - those risks discussed in “*Item 1A. Risk Factors”* and elsewhere in this Annual Report on Form 10-K, as well as those described in any other filings which we make with the SEC. Any forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this Annual Report on Form 10-K, except as required by applicable law. Investors should evaluate any statements made by us in light of these important factors. ### Recent Developments #### Amendments to Loan Agreement Ranor, Inc. along with certain affiliates of the Company entered into the Loan Agreement with the Bank on August 25, 2021 under which, among other things, the Bank provided a revolving line of credit loan to the Borrowers (as defined below) which currently has a maximum principal amount of $4,500. Since March 31, 2026, Ranor and certain affiliates of the Company, collectively the “Borrowers”, entered into an additional amendment to the Loan Agreement which extended the maturity date of the Revolver Loan from May 15, 2026 to September 15, 2026. See “Liquidity, Capital Resources and Going Concern—Bank Term and Revolver Loans” below, for a discussion of the amended debt agreement and its impact on the Company’s liquidity and on-going operations. ### Overview We have two wholly owned subsidiaries that are each a reportable segment, Ranor and Stadco. Each reportable segment focuses on the manufacture and assembly of specific components, primarily for defense and other precision industrial customers. The manufacturing operations of our Ranor subsidiary are situated on approximately 65 acres in North Central Massachusetts. Leveraging our 145,000 square foot facilities, Ranor provides a full range of custom solutions to transform material into precision finished welded components and precision finished machined components up to 100 tons: manufacturing engineering, materials management and traceability, high-precision heavy fabrication (in-house fabrication operations include cutting, press and roll forming, welding, heat treating, assembly, blasting and painting), heavy high-precision machining (in-house machining operations include CNC programming, finishing, and assembly), QC inspection including portable CMM, NonDestructive Testing, and final packaging. All manufacturing at Ranor is performed in accordance with customer requirements. Ranor is an ISO 9001:2015 certificate holder. Ranor is a U.S. defense-centric company with over 95% of its revenue in the defense sector. Ranor is registered and compliant with ITAR. The manufacturing operations of our Stadco subsidiary are situated in an industrial self-contained multi-building complex comprised of approximately 183,000 square feet under roof in Los Angeles, California. Stadco manufactures large mission-critical components on several high-profile military aircraft, military helicopter, and military space programs. Stadco has been a critical supplier to a blue-chip customer base that includes some of the largest OEMs and prime contractors in the defense and aerospace industries. Stadco also manufactures tooling, molds, fixtures, jigs and dies used in the production of defense-centric aircraft components. Our Stadco subsidiary, similar to Ranor, provides a full range of custom solutions: manufacturing engineering, materials management and traceability, high-precision fabrication (in-house fabrication operations include waterjet cutting, press forming, welding, and assembly) and high-precision machining (in-house machining operations include CNC programming, finishing, and assembly), QC inspection including both fixed and portable CMM NonDestructive Testing, and final packaging. In addition, Stadco features a large electron beam welding cell, and two NonDestructive Testing work cells, a unique mission-critical technology set. All manufacturing at Stadco is performed in accordance with customer requirements. Stadco is an AS 9100 D and ISO 9001:2015 certificate holder and a NADCAP NonDestructive Testing certificate holder. Stadco is a US defense-centric company with almost all of its revenue in the defense sector. Stadco is registered and compliant with ITAR. #### Custom Manufacturing We manufacture a variety of components in accordance with our internal core competencies and external customer needs and requirements. We also provide manufacturing engineering services to assist customers in optimizing their engineering designs for manufacturability. We do not design the components we manufacture; we custom manufacture according to customer “build-to-print” requirements and specifications. Accordingly, we do not distribute the components that we manufacture on the open market, and we do not market any products. We do not own the intellectual property rights to any proprietary marketed product, and we do not manufacture in anticipation of orders. Our custom manufacturing operations do not commence on any project before we receive and accept a customer’s purchase order. We only accept contracts that cover specific components within the capability of our resources. We primarily target repeating custom programs with relatively mature and stable designs in order to provide long-term solutions for our customers. The multi-unit work is repeat work or a single product with multiple quantity releases. Secondarily, our activities include a variety of both multi-unit and one-off requirements. The one-off work is typically either a prototype or a unique, one-of-a-kind component. Changes in regulations and market demand for our manufacturing expertise can be significant and sudden, and require us to adapt to the needs of the customers that we serve. Understanding this dynamic, we focus on the defense industry in order to reliably pivot with our defense customers to jointly develop the capability to transform our workforce to manufacture components in accordance with our own and our external customers’ changing requirements. We primarily serve customers in defense and aerospace, secondarily in the precision industrial sectors. Within these sectors, we have manufactured custom components for U.S. Navy submarines and aircraft carriers, USMC military helicopters, U.S. defense and civilian aerospace programs. Our contracts are generated both through negotiation with the customer and from bids made pursuant to a request for proposal. Our ability to receive contract awards is dependent upon the contracting party’s perception of such factors as our ability to perform on time, our history of performance, including quality, our financial condition, and our ability to price our services competitively. ### Critical Accounting Policies and Estimates The preparation of the consolidated financial statements requires that we make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We continually evaluate our estimates, including those related to revenue recognition, recovery of long-lived assets, and income taxes. These estimates and assumptions require management’s most difficult, subjective, or complex judgments. Actual results may differ under different assumptions or conditions. #### Revenue and Related Cost Recognition We recognize revenue over time based on the transfer of control of the promised goods or services to the customer, or at a point in time. This transfer will occur over time when the Company’s performance does not create an asset that has an alternative use to the Company, and we have an enforceable right to payment for performance completed to date. Otherwise, control to the promised goods or services transfers to customers at a point in time. The majority of the Company’s contracts have a single performance obligation and provide title to, or grant a security interest in, work-in-process to the customer. In addition, these contracts contain enforceable rights to payment, allowing the Company to recover both its cost and a reasonable margin on performance completed to date. The combination of these factors indicates that the customer controls the asset (and revenue is recognized) as the asset is created or enhanced. The Company measures progress for performance obligations satisfied over time using input methods (e.g., costs incurred, resources consumed, labor hours expended, time elapsed). Our evaluation of whether revenue should be recognized over time requires significant judgment about whether the asset has an alternative use and whether the entity has an enforceable right to payment for performance completed to date. When any one of these factors is not present, the Company will recognize revenue at the point in time when control over the promised good or service transfers to the customer, i.e., when the customer has accepted the asset and taken physical possession of the product and has legal title, and the Company has a right to payment. When estimating contract costs, the Company takes into consideration a number of assumptions and estimates regarding risks related to technical requirements and scheduling. Management performs periodic reviews of the contracts to evaluate the underlying risks. Profit margin on any given project could increase if the Company is able to mitigate and retire such risks. Conversely, if the Company is not able to properly manage these risks, cost estimates may increase, resulting in a lower profit margin, or potentially, contract losses. The cost estimation process requires significant judgment and is based upon the professional knowledge and experience of the Company’s engineers, program managers, and financial professionals. Factors considered in estimating the work to be completed and ultimate contract recovery include the availability, productivity, and cost of labor, the nature and complexity of the work to be performed, the effect of change orders, the availability of materials, the effect of any delays in performance, the availability and timing of funding from the customer, and the recoverability of any claims included in the estimates to complete. Costs allocable to undelivered units are reported as work in process, a component of inventory, in the consolidated balance sheet. Pre-contract fulfillment costs requiring capitalization are not material. Changes in job performance, job conditions, and estimated profitability are recognized in the period in which the revisions are determined. Costs incurred on uncompleted contracts consist of labor, overhead, and materials. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Our provision for losses at March 31, 2026 and 2025 was $357 and $463, respectively, with 95% and 88% of the totals related to customer projects at our Stadco reportable segment, and the remaining amounts at our Ranor segment. #### Long-lived assets In accordance with Accounting Standards Codification (ASC) 360, *Property, Plant & Equipment*, our property, plant and equipment are tested for impairment whenever events or circumstances indicate the carrying amount of an asset may be impaired. The carrying amount of an asset or asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group. If impaired, the asset is written down to fair value based on either discounted cash flows or appraised values. In the fourth quarter of fiscal 2026, we determined that a history of operating losses at Stadco may indicate that the carrying value of the long-lived assets may not be recoverable. As such, we conducted a test for recoverability of long-lived assets at our Stadco segment and determined that the carrying value of the long-lived assets were not impaired. #### Income Taxes We provide for federal and state income taxes currently payable, as well as those deferred because of temporary differences between reporting income and expenses for financial statement purposes versus tax purposes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recoverable. The effect of the change in the tax rates is recognized as income or expense in the period of the change. A valuation allowance is established, when necessary, to reduce deferred income taxes to the amount that is more likely than not to be realized. In assessing the recoverability of deferred tax assets, we consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. If we determine that it is more likely than not that certain future tax benefits may not be realized, a valuation allowance will be recorded against deferred tax assets that are unlikely to be realized. Realization of the remaining deferred tax assets will depend on the generation of sufficient taxable income in the appropriate jurisdiction, the reversal of deferred tax liabilities, tax planning strategies and other factors prior to the expiration date of the carryforwards. A change in the estimates used to make this determination could require a reduction in the valuation allowance for deferred tax assets if they become realizable. ### Accounting Pronouncements #### New Accounting Standards See Note 3, Accounting Standards Update, in the Notes to the Consolidated Financial Statements under “*Item 8. Financial Statements and Supplementary Data”*, for a discussion of recently adopted new accounting guidance and new accounting guidance not yet adopted. ### Results of Operations Our results of operations are affected by a number of external factors including the availability of raw materials, commodity prices (particularly steel), macroeconomic factors, including the availability of capital that may be needed by our customers, and political, regulatory, and legal conditions in the United States and in foreign markets. Generally, our product mix is made up of short-term contracts with a production timeline of twelve months, more or less. However, contracts for larger complex components can take up to thirty-six months to complete. Units manufactured under most of our customer contracts have historically been delivered on time and with a positive gross margin, with some exceptions. Our results of operations are also affected by our success in booking new contracts, the timing of revenue recognition, delays in customer acceptance of our products, delays in deliveries of ordered products and our rate of progress fulfilling obligations under our contracts. A delay in deliveries or cancellations of orders could have an unfavorable impact on liquidity, cause us to have inventories in excess of our short-term needs, and delay our ability to recognize, or prevent us from recognizing, revenue on contracts in our order backlog. Also, our operating results may fluctuate quarter to quarter as we change over from completed projects to new projects. We evaluate the performance of our segments based upon, among other things, segment revenue and operating profit. Segment operating profit excludes general corporate costs, which include director compensation, stock-based compensation, certain pension and other retirement benefit costs, and other corporate administrative expenses not allocated to the segments. Also excluded are items that we consider not representative of ongoing operations, such as acquisition due diligence costs and termination fees. ### Key Performance Indicators While we prepare our financial statements in accordance with U.S. generally accepted accounting principles, or “U.S. GAAP”, we also utilize and present certain financial measures that are not based on or included in U.S. GAAP. We refer to these as non-GAAP financial measures. Please see the section titled “*EBITDA Non-GAAP Financial Measure”* below for further discussion of these financial measures, including the reasons why we use such financial measures and reconciliations of such financial measures to the most directly comparable U.S. GAAP financial measures. Corporate expenses include stock-based compensation, board of director compensation, and other corporate general expenses not allocated to the segments. Percentages in the following tables and throughout this “*Results of Operations”* section may reflect rounding adjustments. ### Fiscal Years Ended March 31, 2026 and 2025 The following table presents revenue, cost of revenue, gross profit (loss), consolidated and by reportable segment: *(dollars in thousands)* | ​ ​ ​ Revenue | ​ ​ ​ ​ ​ ​ ​ | ​ ​ 2026 ​ Amount ​ ​ | ​ ​ ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent of ​ Revenue ​ ​ ​ | ​ ​ 2025 ​ Amount ​ ​ | ​ ​ ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent of ​ Revenue ​ ​ ​ | ​ ​ Changes ​ Amount ​ ​ | ​ ​ ​ ​ ​ ​ | ​ ​ ​ ​ Percent ​ ​ | | --- | --- | --- | --- | ---: | --- | --- | ---: | --- | --- | ---: | | Ranor | ​ | $16,946 | ​ | 54% | $18,165 | ​ | 53% | $(1,219) | ​ | (7)% | | Stadco | ​ | ​ 15,306 | ​ | 48% | ​ 15,998 | ​ | 47% | ​ (692) | ​ | (4)% | | Intersegment elimination | ​ | ​ (608) | ​ | (2)% | ​ (132) | ​ | —% | ​ (476) | ​ | (361)% | | Consolidated Revenue | ​ | $31,644 | ​ | 100% | $34,031 | ​ | 100% | $(2,387) | ​ | (7)% | | **Cost of Revenue** | ​ | ​ ​ | ​ | ​ ​ | ​ ​ | ​ | ​ ​ | ​ ​ | ​ | ​ ​ | | Ranor | ​ | $11,119 | ​ | 35% | $12,623 | ​ | 37% | $(1,504) | ​ | (12)% | | Stadco | ​ | ​ 16,158 | ​ | 51% | ​ 17,211 | ​ | 50% | ​ (1,053) | ​ | (6)% | | Intersegment elimination | ​ | ​ (608) | ​ | (2)% | ​ (132) | ​ | —% | ​ (476) | ​ | (361)% | | Consolidated Cost of Revenue | ​ | $26,669 | ​ | 84% | $29,702 | ​ | 87% | $(3,033) | ​ | (10)% | | **Gross Profit (Loss)1** | ​ | ​ ​ | ​ | ​ ​ | ​ ​ | ​ | ​ ​ | ​ ​ | ​ | ​ ​ | | Ranor | ​ | $6,324 | ​ | 20% | $5,674 | ​ | 16% | $650 | ​ | 11% | | Stadco | ​ | ​ (1,349) | ​ | (4)% | ​ (1,345) | ​ | (3)% | ​ (4) | ​ | —% | | Consolidated Gross profit | ​ | $4,975 | ​ | 16% | $4,329 | ​ | 13% | $646 | ​ | 15% | #### 1 net of intersegment eliminations ### Revenue *Consolidated –* Revenue was $31,644 for the fiscal year ended March 31, 2026, a decrease of $2,387 or 7% when compared to revenue for the fiscal year ended March 31, 2025. Consolidated gross profit increased by 15% and gross margin expanded to 16% during the fiscal year ended March 31, 2026. Changes in our project mix dampened revenue as our rate of progress fulfilling obligations slowed. *Ranor –* Revenue was $16,946 for the fiscal year ended March 31, 2026, a decrease of $1,219 or 7% when compared to the same period a year ago. The customer project mix remains favorable but has changed from the same prior year period, as a different set of defense customers made up a significant portion of our revenue stream in fiscal 2026. The backlog at Ranor on March 31, 2026 was $29,405 as new orders continue to flow to us from our existing customer base of prime defense contractors. *Stadco –* Revenue was $15,306 for the fiscal year ended March 31, 2026, compared with revenue of $15,998 for the fiscal year ended March 31, 2025, a decrease of $692 or 4%. The customer project mix changed from the same prior year period, as a different set of defense customers made up a significant portion of our revenue stream in fiscal 2026. Stadco’s backlog as of March 31, 2026 was $22,793 as new orders for components related to a variety of programs, including military aircraft, military helicopter, and military space programs, continue to flow to us from our existing customer base of prime defense contractors. ### Cost of Revenue and Gross Profit *Consolidated –* Cost of revenue consists primarily of raw materials, parts, labor, overhead and subcontracting costs. Our cost of revenue for the fiscal year ended March 31, 2026, was $26,669, or 10% lower when compared to the fiscal year ended March 31, 2025. Gross profit increased by $646, or 15% and gross margin expanded to 16% compared with 13% in the same period a year ago. Our project mix remains favorable but has changed when compared with the same period a year ago. *Ranor –* Gross profit increased by $650 or 11% when compared to the same period a year ago, and gross margin expanded as cost of revenue decreased by $1,504 or 12%. Ranor had a favorable project mix in fiscal 2026 but with a different mix of customer products that resulted in a favorable materials variance with more direct labor hours utilized. *Stadco –* Gross profit was negative $1,349 for the fiscal year ended March 31, 2026, slightly higher when compared to the same period a year ago, as Stadco continues to work through certain unfavorable legacy contracts and first article parts. Cost of revenue decreased by $1,053 or 6% on a favorable materials variance and less direct labor hours utilized. Also, repairs and maintenance costs, which had a negative impact on manufacturing during fiscal 2025, decreased by 28% in fiscal 2026. ### Selling, General and Administrative (SG&A) Expenses *(dollars in thousands)* | ​ ​ ​ | ​ ​ ​ ​ ​ ​ ​ | ​ ​ 2026 ​ ​ Amount | ​ ​ ​ ​ ​ | ​ ​ ​ Percent of ​ Revenue ​ ​ ​ | ​ ​ 2025 ​ ​ Amount | ​ ​ ​ ​ ​ | ​ ​ ​ Percent of ​ Revenue ​ ​ ​ | ​ ​ Changes ​ ​ Amount | ​ ​ ​ ​ ​ | ​ ​ ​ ​ Percent | | --- | --- | ---: | --- | ---: | ---: | --- | ---: | ---: | --- | ---: | | Ranor | ​ | $2,552 | ​ | 8% | $2,545 | ​ | 7% | $7 | ​ | —% | | Stadco | ​ | ​ 2,788 | ​ | 9% | ​ 3,298 | ​ | 10% | ​ (510) | ​ | (15)% | | Corporate and unallocated | ​ | ​ 702 | ​ | 2% | ​ 644 | ​ | 2% | ​ 58 | ​ | 9% | | Consolidated SG&A | ​ | $6,042 | ​ | 19% | $6,487 | ​ | 19% | $(445) | ​ | (7)% | *Consolidated –* Total selling, general and administrative expenses for the fiscal year ended March 31, 2026, decreased by $445, or 7%, as a decrease in professional fees and office costs more than offset an increase in compensation and benefits. *Ranor –* SG&A expense increased by $7 primarily as an increase in compensation costs for staff additions slightly offset a decrease in professional fees and other office expenses. *Stadco –* SG&A expense decreased by $510 primarily on a decrease in professional fees and office costs. *Corporate and unallocated –* SG&A increased year-over-year primarily on an increase in stock-based compensation. That increase was offset in part a change in fair value ($419) for a breakup fee in connection with the terminated acquisition of Votaw Precision Technologies, Inc., or the “Votaw acquisition” which was evident in fiscal 2025. There were no breakup fees recorded in fiscal 2026. ### Operating (loss) income *(dollars in thousands)* | ​ ​ ​ | ​ ​ ​ ​ ​ ​ | ​ ​ 2026 ​ ​ Amount | ​ ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent of ​ ​ ​ Revenue ​ | ​ ​ 2025 ​ ​ Amount | ​ ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent of ​ Revenue ​ | ​ ​ Changes ​ ​ Amount | ​ ​ ​ ​ ​ | ​ ​ ​ ​ ​ Percent ​ | | --- | --- | ---: | --- | ---: | ---: | --- | ---: | ---: | --- | ---: | | Ranor | ​ | $3,772 | ​ | 12% | $3,129 | ​ | 9% | $643 | ​ | 21% | | Stadco | | ​ (4,137) | ​ | (13)% | ​ (4,643) | ​ | (13)% | ​ 506 | ​ | 11% | | Corporate and unallocated | | ​ (702) | ​ | (2)% | ​ (644) | ​ | (2)% | ​ (58) | ​ | (9)% | | Operating loss | ​ | $(1,067) | ​ | (3)% | $(2,158) | ​ | (6)% | $1,091 | ​ | 51% | *Consolidated –* As a result of the foregoing, for the fiscal year ended March 31, 2026, we reported an operating loss of $1,067 compared with operating loss of $2,158 for the fiscal year ended March 31, 2025. The change was primarily due to higher operating income at Ranor and lower operating losses at Stadco. *Ranor –* Operating income increased, as profit margins expanded on lower manufacturing costs and improved productivity. *Stadco –* Operating loss decreased primarily on lower SG&A expenses. *Corporate and unallocated –* Operating loss increased as an increase in stock-based compensation more than offset a decrease in costs related to the Votaw acquisition. ### Other Income (Expense), net The following table presents other income (expense) for the fiscal years ended March 31: *(dollars in thousands)* | ​ | ​ ​ ​ ​ | ​ ​ 2026 | ​ ​ ​ ​ | ​ ​ 2025 | ​ ​ ​ ​ | ​ ​ $ Change | ​ ​ ​ ​ ​ ​ % Change | | --- | --- | ---: | --- | ---: | --- | ---: | ---: | | Other expense, net | ​ | $(81) | ​ | $(51) | ​ | $(30) | (60)% | | Interest expense | ​ | $(415) | ​ | $(438) | ​ | $23 | 5% | | Amortization of debt issue costs | ​ | $(70) | ​ | $(103) | ​ | $33 | 32% | Other expense, net, for the fiscal year ended March 31, 2026, includes a write-off of $83 for costs in connection with refinancing activities and other interest income of $2. Other expense for the fiscal year ended March 31, 2025, includes a payment of $108 to investors as liquidated damages plus interest for a late registration filing in connection with the July 2024 private placement. That payment more than offset other income of $45 from non-operating filming activities, plus a vendor rebate and other interest income. Interest expense decreased by $23 when compared with the same period a year ago, primarily on lower scheduled interest payments for the Ranor and Stadco Term Loans. Amortization of debt issue costs for the fiscal year ended March 31, 2026 decreased by 32% on lower amortization in connection with the debt issue costs. ### Income Taxes During the fiscal year ended March 31, 2026, there has been no change in our judgment about the realizability of deferred tax assets in future years. For the fiscal year ended March 31, 2026 and 2025, the Company recorded tax expense and tax benefit of $31 and $2, respectively. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The valuation allowance on deferred tax assets at March 31, 2026 and 2025 was $6,200 and $5,722, respectively. We believe that it is more likely than not that the benefit from certain state NOL carryforwards and other deferred tax assets will not be realized. The assessment was based on the weight of negative evidence at the balance sheet date, our recent operating losses and unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels. In recognition of this risk, we continue to provide a valuation allowance on these items. ### Net Loss As a result of the foregoing, for fiscal 2026, we recorded a net loss of $1,664, or $0.17 per share basic and fully diluted, compared with a net loss of $2,748, or $0.29 per share basic and fully diluted in fiscal 2025. ### Liquidity, Capital Resources and Going Concern Our liquidity is highly dependent on the availability of financing facilities and our ability to maintain gross profit and operating income. As of March 31, 2026, we had $1,485 in total available liquidity, consisting of $431 in cash, and $1,054 in undrawn capacity under our Revolver Loan. As of March 31, 2025, we had $1,451 in total available liquidity, consisting of $195 in cash and $1,256 in undrawn capacity under our Revolver Loan. There was $3,446 and $3,150 outstanding under the Revolver Loan on March 31, 2026 and 2025, respectively. The Company pays interest at an adjusted SOFR - based rate. Interest - only payments on advances made under the Revolver Loan are payable monthly in arrears. Interest paid and accrued on advances made under the Revolver Loan during fiscal 2026 and 2025, totaled $200 and $197, respectively. The weighted average interest rate on March 31, 2026 and 2025 was 6.70% and 7.47%, respectively. The average amount outstanding during the fiscal year ended March 31, 2026 and 2025 was $2,983 and $2,600, respectively. At March 31, 2026 our working capital was negative $441 because of the reclassification of our long-term debt from noncurrent to current in the consolidated balance sheet. The table below presents selected liquidity and capital measures on: *(dollars in thousands)* | ​ ​ | ​ ​ ​ ​ ​ | ​ ​ March 31, 2026 | ​ ​ ​ ​ ​ | ​ ​ March 31, 2025 | ​ ​ ​ ​ ​ | ​ ​ Change Amount | | --- | --- | ---: | --- | ---: | --- | ---: | | Cash | ​ | $431 | ​ | $195 | ​ | $236 | | Working capital | ​ | $(441) | ​ | $(1,570) | ​ | $1,129 | | Total debt | ​ | $7,037 | ​ | $7,424 | ​ | $(387) | | Total stockholders’ equity | ​ | $7,673 | ​ | $8,740 | ​ | $(1,067) | The next table summarizes changes in cash by primary component in the cash flows statements for the fiscal years ended: *(dollars in thousands)* | ​ ​ | ​ ​ ​ ​ ​ | ​ ​ March 31, 2026 | ​ ​ ​ ​ ​ | ​ ​ March 31, 2025 | ​ ​ ​ ​ ​ | ​ ​ Change Amount | | --- | --- | ---: | --- | ---: | --- | ---: | | Operating activities | ​ | $6 | ​ | $(599) | ​ | $605 | | Investing activities | ​ | 868 | ​ | (1,081) | ​ | 1,949 | | Financing activities | ​ | (638) | ​ | 1,737 | ​ | (2,375) | | Net increase in cash | ​ | $236 | ​ | $57 | ​ | $179 | #### Operating activities Apart from our loan facilities, our primary sources of cash are provided by customer revenue, customer contract advances, and associated accounts receivable collections. Many of our customers make advance payments and progress payments under the terms of each manufacturing contract. The composition of our accounts receivable collections mix changes between advance payments and customer payments made after shipment of finished goods. Our cash flows can fluctuate from period to period as we make progress with customer project milestones and the timing of progress payments. Cash provided by operating activities for the fiscal year ended March 31, 2026 was $6, and cash used in operating activities for the fiscal year ended March 31, 2025 was $599. Net loss adjusted by our non-cash items provided $1,865 and $813 for the fiscal years ended March 31, 2026 and 2025, respectively. For the fiscal year ended March 31, 2026 and 2025, we used $1,859 and $1,412 of cash, respectively, for changes in operating assets and liabilities. #### Investing activities In fiscal 2026 we invested $3,265 in new factory machinery and equipment and were reimbursed for $4,133 of certain purchases under a supplier development fund. In fiscal 2025 we invested $4,122 in new factory machinery and equipment and were reimbursed for $3,041 of certain purchases under a supplier development fund. We are subject to certain financial debt covenants and may not spend more than $1,500 on new machinery and equipment during any single fiscal year tested on an annual basis at the end of each fiscal year. We estimate that our spending on new machinery and equipment in fiscal 2027, including supplier development funding, will exceed that spending limitation. #### Financing activities In fiscal 2026 we drew down $18,236 of proceeds under the Revolver Loan and repaid $17,940 during the same period. We also used $695 in cash to pay down debt principal and make periodic lease payments. We also used $239 in cash in connection with refinancing activities and the Revolver Loan renewals. We drew down $13,876 of proceeds under our Revolver Loan during fiscal 2025 and repaid $13,511 during the same period. We also used $663 of cash to pay down debt principal and make periodic lease payments and financed the purchase of certain equipment at Stadco for $65. In fiscal 2025, the Company sold 666,100 shares of the Company’s common stock, par value $0.0001 per share, and 666,100 common stock purchase warrants to purchase 666,100 shares of Common Stock in a private placement at an aggregate purchase price of $2,299. Placement agent’s fees in connection with the offering totaled $247. All of the above activity resulted in a net increase in cash of $236 and $57 for fiscal 2026 and 2025, respectively. #### Bank Term and Revolver Loans On August 25, 2021, the Company entered into the Loan Agreement. Under the Loan Agreement, the Bank provided the Ranor Term Loan and the Revolver Loan. In addition, the Bank provided the term loan in the original amount of $4,000, or the “Stadco Term Loan.” The proceeds of the original term loan of $2,850, or the “Ranor Term Loan,” were used to refinance existing mortgage debt of Ranor. The proceeds of the Revolver Loan are used for working capital and general corporate purposes of the Company. Payments for the original Ranor Term Loan began on January 20, 2017, and until the facility was amended in December 2022, the Company paid monthly installments of $19 each, inclusive of interest at a fixed rate of 5.21% per annum. The proceeds of the Stadco Term Loan were used to support the acquisition of Stadco and refinance existing indebtedness of Stadco. Interest on the Stadco Term Loan is due on unpaid balances beginning on August 25, 2021, at a fixed rate per annum equal to the 7-year Federal Home Loan Bank of Boston Classic Advance Rate plus 2.25%. Since September 25, 2021, and on the 25th day of each month thereafter, Stadco has made and will continue to make monthly payments of principal and interest in the amount of $54 each, with all outstanding principal and accrued interest due and payable on August 25, 2028. The Borrowers agree that their combined annual capital expenditures shall not exceed $1,500. Compliance shall be tested annually. On June 12, 2023, the Company and the Bank executed a waiver under which the Bank waived the Company’s noncompliance with the capital expenditure limit and acknowledged that specified capital expenditures can be excluded from the calculation of the Borrowers combined annual expenditures for the fiscal year ended March 31, 2024. For the fiscal years ended March 31, 2026 and 2025, the Company, including specified capital expenditures, exceeded combined annual capital expenditures of $1,500. Between December 20, 2021 and January 16, 2026, Ranor and certain affiliates of the Company entered into thirteen separate amendments to the Loan Agreement to, among other things, extend the maturity date of the Ranor Term Loan and Revolver Loan to December 15, 2027 and May 15, 2026, respectively. In addition, the amendments (i) limited the use of proceeds from the Revolver Loan by the Company or its affiliates to $2,000 in the aggregate for due diligence and related professional costs incurred on or prior to May 10, 2024 in connection with any acquisitions, (ii) amended the maximum principal amount of the Revolver Loan from $5,000 to $4,500; (iii) made certain changes to the amount and methods of valuation of equipment securing repayment of the borrowed funds, and (iv) effective June 1, 2024, increased the Term SOFR Margin (as defined in the Amendment) used to calculate the interest rate from 2.25% per annum to 2.50% per annum. The interest rate on the Ranor Term Loan is 6.05%, the monthly payment on the Ranor Term Loan is $17 with benchmark SOFR-based pricing conventions. On May 13, 2026, Ranor and the other borrowers entered into a fourteenth amendment to the Loan Agreement, which among other things, extended the maturity date of the Revolver Loan from May 15, 2026 to September 15, 2026. As a result of the Borrowers’ failure to satisfy the required Balance Sheet Leverage Ratio for the twelve (12) month period ending March 31, 2026, as set forth in the Loan Agreement, or the “Existing Default”, the Borrowers acknowledge that a certain Event of Default has occurred and is continuing under the Loan Agreement. The borrowers further acknowledge that the sixth amendment to the Loan Agreement constitutes written notice pursuant to the loan documents of such Existing Default. Regardless of entering into the most recent amendment to the Loan Agreement or any discussions between the Borrowers and the Bank, the Bank expressly reserves any and all rights and remedies available to it under the loan documents, and under applicable law, including, without limitation, its right to choose to accelerate and demand the outstanding indebtedness evidenced by the loan documents and seek immediate repayment in full, and institute the default rate of interest as of the date of the occurrence of the default or at any time thereafter, as a result of any default or event of default, including, without limitation, the Existing Default, that has arisen or may arise. No such discussions or the entering into the most recent amendment to the Loan Agreement shall imply any course of conduct or any agreement on the part of the Bank to waive any of its rights and remedies or to forbear from taking any action authorized by the loan documents or by applicable law while discussions continue. There was $7,031 and $7,387 outstanding under the Loan Agreement on March 31, 2026 and 2025, respectively. Without a waiver, the lender has the right, but not the obligation, to demand repayment from the Company for noncompliance with the debt covenants. In addition, the Bank retains the right to act on covenant violations that occur after the date of delivery of any waiver. The lender has not granted us a waiver. As such, we need to seek alternative financing to pay these obligations as the Company does not have existing facilities or sufficient cash on hand to satisfy these obligations. It is also probable that the Company will not be in compliance with the same debt covenants at subsequent measurement dates within the next twelve months. As a result of the above, all of our long-term debt has been classified as current in our consolidated balance sheet. On July 3, 2024, the Company entered into a Security Purchase Agreement with certain accredited investors, pursuant to which the Company sold common stock and warrants in a private placement at an aggregate purchase price of $2,299. The combined purchase price for one share of common stock and one warrant was $3.45. The purpose of the sale of the common stock and warrants was to raise working capital for use by the Company. The Company continues to explore various means of strengthening its liquidity position and ensuring compliance with its debt financing covenants by making Stadco operations profitable, renewing our revolver loan, or entering into alternative debt facilities. In order for us to continue operations beyond the next twelve months from the date of issuance of the financial statements and to be able to discharge our liabilities and commitments in the normal course of business, we must renew our revolver loan or seek alternative financing by September 15, 2026. We must mitigate our recurring operating losses at our Stadco subsidiary, efficiently increase utilization of our manufacturing capacity at Stadco and improve the manufacturing process. We plan to closely monitor our expenses and, if required, will reduce operating costs to enhance liquidity. The uncertainty associated with the recurring operating losses at Stadco, the revolver loan renewal, the need for alternative financing, and compliance with debt covenants at subsequent measurement dates raise substantial doubt about our ability to continue as a going concern for at least one-year after the date the consolidated financial statements included in this Annual Report on Form 10-K are issued. Collateral securing all the above obligations comprises all personal and real property of the Company, including cash, accounts receivable, inventories, equipment, and financial assets. ### Commitments and Contractual Obligations The following contractual obligations associated with our normal business activities are expected to result in cash payments in future periods, and include the following material items on March 31, 2026: - Our debt obligations under the bank loan agreement, including fixed and variable-rate debt, totaled $7,031, and, because of debt covenant violations, are classified as current in the consolidated balance sheets. - We enter into various commitments with suppliers for the purchase of raw materials and work supplies. Our outstanding unconditional contractual commitments, including the purchase of raw materials and supplies goods, totaled $2,805, all of it due to be incurred and paid within the next twelve months. - We also have $13,247 in purchase obligations outstanding for the purchase of machinery and equipment under an arrangement with a certain customer where the Company is reimbursed in full for all purchases. - Our operating lease obligations, including imputed interest, totaled $3,912 for buildings through 2030, with $939 due annually for each of the next four years and $156 in year six. There were no off-balance sheet arrangements as of March 31, 2026. ### EBITDA Non-GAAP Financial Measure To complement our consolidated statements of operations and consolidated statements of cash flows, we use EBITDA, a non-GAAP financial measure. Net income (loss) is the financial measure calculated and presented in accordance with U.S. GAAP that is most directly comparable to EBITDA. We believe EBITDA provides our board of directors, management, and investors with a helpful measure for comparing our operating performance with the performance of other companies that have different financing and capital structures or tax rates. We also believe that EBITDA is a measure frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry, and is a measure contained in our debt covenants. However, while we consider EBITDA to be an important measure of operating performance, EBITDA and other non-GAAP financial measures have limitations, and investors should not consider them in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. We define EBITDA as net income (loss) plus interest, income taxes, depreciation, and amortization. Net loss was $1,664 for the fiscal year ended March 31, 2026, as compared to net loss of $2,748 for the year ended March 31, 2025. EBITDA, a non-GAAP financial measure, was $1,646 for the year ended March 31, 2026, compared to $587 for the year ended March 31, 2025. The following table provides a reconciliation of EBITDA to net loss, the most directly comparable U.S. GAAP measure reported in our consolidated financial statements for the fiscal years ended: *(dollars in thousands)* | ​ ​ | ​ ​ ​ ​ ​ | ​ ​ March 31, 2026 | ​ ​ ​ ​ ​ | ​ ​ March 31, 2025 | ​ ​ ​ ​ ​ | ​ ​ Change Amount | | --- | --- | ---: | --- | ---: | --- | ---: | | Net loss | ​ | $(1,664) | ​ | $(2,748) | ​ | $1,084 | | Income tax expense (benefit) | ​ | 31 | ​ | ​ (2) | ​ | ​ 33 | | Interest expense (1) | ​ | 485 | ​ | 541 | ​ | (56) | | Depreciation and amortization | ​ | 2,794 | ​ | 2,796 | ​ | (2) | | EBITDA | ​ | $1,646 | ​ | $587 | ​ | $1,059 | #### (1) Includes amortization of debt issue costs. ## Controls and procedures As filed, 14,208 characters. Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are controls and procedures that are designed to ensure that the information required to be disclosed in our reports filed or submitted under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and includes controls and procedures designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. #### Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report, an evaluation was carried out, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of March 31, 2026, our disclosure controls and procedures were not effective due to the material weaknesses in our internal control over financial reporting described below. #### Management’s Responsibility for Internal Controls The Company’s internal control over financial reporting is designed under the supervision of our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. The Company’s internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that the Company’s receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements. #### Inherent Limitations Over Internal Controls Management, including the Chief Executive Officer and Chief Financial Officer, does not expect that the Company’s internal controls will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of internal controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Also, any evaluation of the effectiveness of controls in future periods is subject to the risk that those internal controls may become inadequate because of changes in business conditions, or that the degree of compliance with the policies or procedures may deteriorate. #### Management’s Report of Internal Control over Financial Reporting. Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of March 31, 2026, based on the 2013 framework established by the Committee of Sponsoring Organizations of the Treadway Commission in *Internal Control - Integrated Framework*. Based on that assessment, management concluded that, the Company’s internal control over financial reporting was not effective as of March 31, 2026, due to the material weaknesses described below. #### Material Weaknesses We identified four material weaknesses in our internal control over financial reporting as of March 31, 2026. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. In connection with the preparation of our financial statements for this Annual Report on Form 10-K, management identified the following material weaknesses: 1\) *Purchase accounting -* we did not maintain proper controls, processes and procedures over the initial purchase accounting and the fair value accounting associated with our acquisition of Stadco in the fiscal year ended March 31, 2022 that were adequately designed, documented, and executed to support the accurate and timely reporting of our financial results regarding the initial purchase accounting and the fair value accounting associated with the Stadco acquisition. 2\) *Stadco accounting -* we did not maintain a sufficient complement of resources and expertise on the Stadco accounting staff necessary to consistently perform management review controls over financial information and complete account reconciliations on a timely basis, to ensure all transactions are accurately captured and recorded prior to closing the books. The demand on our accounting resources is significant due to the manual nature of controls necessary to maintain effective control over Stadco’s legacy system. As a result of this material weakness, we made several post-closing adjustments for percentage-of-completion (POC) revenue projects. The adjustment corrected inputs for project revenues and costs in progress at Stadco, as the initial and correcting journal entries were not reconciled and posted in a timely manner during the year end reporting cycle. Because of the foregoing reasons, extra time was required to complete certain items with respect to the financial statement preparation, closing and review process for the year ended March 31, 2025. 3\) *Accounting for impairment of long-lived assets -* in the fourth quarter of fiscal 2025 we engaged a third-party specialist to perform an impairment test on the recoverability of long-lived assets triggered by a history of operating losses at Stadco. Because of our inability to close the Stadco books in a timely manner, extra time was required to complete certain tasks with respect to the impairment test, and we were not able to execute a timely management review of the valuation report. Because of this material weakness, we made a late journal entry to our general ledger which was subsequently reversed while preparing the consolidated financial statements and footnotes included in the Annual Report on Form 10-K. The demand on corporate accounting resources is significant due to the manual nature of controls necessary to maintain effective control over Stadco’s legacy accounting system and intensifies during the quarterly closings. 4\) *Segregation of duties -* Duties are logically divided among people and processes to mitigate risks and meet financial reporting objectives. Inadequate segregation of duties could result in misappropriation of assets or intentional misstatements in the financial statements. Management performs an annual assessment including planning, scoping, documentation, and testing of controls. As a result of the assessment, we discovered that in fiscal 2025, we operated for a brief period when our interim CFO/Controller assumed roles as a reviewer and journal entry preparer with access to the general ledger and other financial reporting programs and spreadsheets. These conditions were temporary and existed during a brief period as the Company transitioned to our new CFO on March 31, 2025. Notwithstanding the material weaknesses, management believes the consolidated financial statements included in this Annual Report on Form 10-K present fairly, in all material respects, the Company’s financial condition, results of operations and cash flows as of and for the fiscal years presented in accordance with U.S. GAAP. #### Remediation of Material Weaknesses For the fiscal year ended March 31, 2026, we reviewed our entity level controls, staffing requirements and the cost/benefit for remediating our material weaknesses. In fiscal 2024, our management, with the oversight of our audit committee, began to implement a plan to take measures in order to remediate the underlying causes of the material weaknesses through the development and implementation of a thorough review of our procedures, policies, processes, and review controls to gain additional assurance regarding the remediation our accounting for acquisitions, income taxes, closing cycle time at Stadco, impairment of long-lived assets, and segregation of duties. This remediation process has not been completed, and the following is an update through the end of fiscal 2026: 1\) *Purchase accounting -* The Company enhanced its working framework with a memorandum that depicts a clear, explicit roadmap for the purchase accounting guidance at every step. We will follow that roadmap and will implement new controls as required. We engaged a third-party specialist in July 2023 with the requisite knowledge to perform all required valuations and accounting for business combinations. That specialist worked with the Company on all the pre-acquisition activities, or due diligence, in connection with the Votaw acquisition. The specialist was hired primarily to ensure that certain accounting issues that arose in the Stadco acquisition would not re-occur with the purchase accounting for the Votaw acquisition. Ultimately, the Votaw acquisition process terminated, but the Company enhanced its policy, procedures and process level controls on how it gathers and analyzes relevant facts and circumstances in connection with all complex business transactions. We will document the required evidence that needs to be maintained (e.g., checklists, signatures) for each existing and new internal control and communicate the requirements to key stakeholders. We will review and test our controls and procedures again with the next acquisition target before making a final validation on operating effectiveness. 2\) *Stadco accounting -* For the fiscal year ended March 31, 2026, we reviewed our entity level controls, staffing requirements and the cost/benefit for upgrading our legacy systems and accounting staff at Stadco. As a result of this review, we continue to transition the accounting function to the CFO office in Massachusetts, where expert and experienced personnel are in-place to execute a plan to a) improve the effectiveness and efficiency of the accounting operation, ensuring a timely closing cycle, b) improve the reliability of financial reporting, and c) ensure continued compliance with generally accepted accounting principles and applicable laws and regulations. We implemented these measures during fiscal 2024, 2025 and 2026, and we will monitor progress during fiscal 2027 as we facilitate remediation of the material weakness. 3\) *Accounting for impairment of long-lived assets -* We will continue to engage a third-party specialist with the requisite knowledge to perform all required testing in connection with the impairment of long-lived assets. This specialist worked with the Company on acquisition activities in connection with the Stadco purchase. We identified the late journal entry as a control gap, i.e., the controls design was effective but did not operate as designed. Management will develop and implement a formal policy with related procedures to supplement existing controls to ensure a timely evaluation of triggering events and changes in circumstances that may indicate an impairment of long-lived assets. We will review and test the process again during the next impairment testing date before making a final validation on operating effectiveness. 4\) *Segregation of duties -* This conflict has been resolved with the hiring of a new CFO on March 31, 2025, as duties are properly segregated under the CFO and controller’s office. We will continue to assess scoping, documentation, and testing of controls under the financial reporting function during the next fiscal year before making a final validation on operating effectiveness. Management believes that the above actions continue the process of remediation for the material weakness as disclosed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2026. The material weaknesses will not be considered remediated, however, until the applicable controls operate for a sufficient period and management has concluded, through testing, that these controls are operating effectively. We can provide no assurance as to when the remediation of these material weaknesses will be completed to provide for an effective control environment. We have identified and will continue to strengthen our internal control over financial reporting. We are committed to continually improving our internal control process and will diligently review our financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial reporting, we may decide that additional measures are necessary to address control deficiencies. #### Changes in Internal Control over Financial Reporting Except for our remediation efforts described above, there have been no changes in our internal control over financial reporting during the fiscal year ended March 31, 2026 that have materially affected or are reasonably likely to affect our internal control over financial reporting. Filed Jun 25, 2026. Source: SEC EDGAR, the filing index for accession 0001104659-26-077758. Last ingested by Listed: Oct 29, 2026, 04:32 ET. No prices; not investment advice.