In July 30, 2025, the Financial accounting Standards Board (the "FASB") issued Accounting Standard Update (ASU) 2025-5, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets” to simplify the estimation of expected credit losses for current accounts receivable and current contract assets arising from revenue-transactions under ASC 606. Key changes include a practical expedient, available to all entities, that allows assuming that conditions as of the balance sheet date will remain unchanged over the life of those assets. The amendments are effective for annual periods beginning after December 15, 2025, including interim periods, with early adoption permitted; the guidance should be applied prospectively. The Company adopted this ASU for the six months ended December 31, 2025 and the adoption did not have a material effect on the financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision usefulness of income tax disclosures. This ASU will be effective for the annual period ending June 30, 2026. The Company is currently evaluating the timing and impacts of adoption of this ASU.

In November 2024, FASB issued ASU 2024-03, Income Statement reporting Comprehensive Income - Expense Disaggregation Disclosure (Subtopic 220-40): Disaggregation of Income Statement Expense, which requires disclosure in the notes to the financial statements of specified information about certain costs and expenses. The amendments are effective for the fiscal years beginning after December 15, 2026, and for interim periods within the fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the new guidance to determine the impact it may have on its condensed consolidated financial statements and related disclosure.

In January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, which clarifies the effective date of ASU 2024-03. ASU 2024-03 expands disclosure requirements to require disaggregation of specified expense captions by natural expense categories. The amendments are effective for public business entities for annual reporting periods beginning after December 15, 2026, and for interim periods within those fiscal years beginning after December 15, 2027; early adoption is permitted. The Company is currently evaluating its impact on our footnote disclosures.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("US GAAP") requires management to make estimates and assumptions that impact the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

The Company has one operating and reportable segment. The Company’s CODM is its Chief Executive Officer and Chief Operating Officer, who reviews financial information presented on a consolidated basis for the purpose of allocating resources and evaluating financial performance.

Accounts receivables are recorded at net realizable value. The Company performs ongoing credit evaluations of customers financial conditions and does not require collateral for accounts receivable arising in the normal course of business. The Company maintains allowances for potential credit losses based on the Company’s historical trends, specific customer issues and current economic trends. Accounts are written off against the allowance when they are determined to be uncollectible based on management’s assessment of individual accounts. While such credit losses have historically been within the Company’s

expectation and the provision established, the Company cannot guarantee about the amount of future credit losses or the suffciency of the allowance therefore. The Company recorded an allowance for credit losses of $102,677 and $164,499 as of December 31, 2025 and June 30, 2025, respectively.



	For the Three Months Ended December 31,				For the Six Months Ended December 31,
	2025		2024		2025		2024
Balance, at beginning of the period	$	75,177	$	171,104	$	164,499	$	171,104
Provision	28,000		—		28,000		—
Recovery	—		—		(88,134)		—
Write-offs	(500)		—		(1,688)		—
Balance, at the end of the period	$	102,677	$	171,104	$	102,677	$	171,104

Inventories are stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out basis and include freight-in materials, labor and overhead costs. Inventories are written down if the estimated net realizable value is less than the recorded value. The Company reviews the carrying cost of inventories by product to determine the adequacy of reserves for obsolescence. In accounting for inventories, the Company must make estimates regarding the estimated realizable value of inventory. The estimate is based, in part, on age of inventory. If actual conditions are less favorable than those the Company has projected, the Company may need to increase its reserves for excess and obsolete inventories. Any increases in the reserves will adversely impact the Company’s results of operations. The establishment of a reserve for excess and obsolete inventory establishes a new cost basis in the inventory. Such reserves are not reduced until the product is sold. If the Company is able to sell such inventory any related reserves would be reversed in the period of sale. In accordance with industry practice, service parts inventory is included in current assets, although service parts are carried for established requirements during the serviceable lives of the products and, therefore, not all parts are expected to be sold within one year.

The Company records deferred revenues when cash payments are received or due in advance of its performance. The Company’s deferred revenues relate to payments received for the customer care plans for a 12-month period. The consideration received is recognized monthly over the service period. Revenue recorded that was included within prior period deferred revenue was $124,000 and $164,000, respectively for the three-month periods ended December 31, 2025 and 2024. Revenue recorded that was included within prior period deferred revenue was $218,000 and $272,000, respectively for the six-month periods ended December 31, 2025 and 2024.

The Company used the two-class method to compute net income per common share. These participating securities included the Company’s convertible preferred stock which accrues dividends payable. The two-class method requires earnings for the period to be allocated between common stock and participating securities based upon their respective rights to receive distributed and undistributed earnings.

the period. Net income attributable to common stockholders is computed by subtracting from net income the portion of current period earnings that the participating securities would have been entitled to receive pursuant to their dividend rights had all of the period’s earnings been distributed. No such adjustment to earnings is made during periods with a net loss, as the holders of the participating securities have no obligation to fund losses.

Diluted net income per common share is computed under the two-class method by using the weighted average number of shares of common stock outstanding, plus, for periods with net income attributable to common stockholders, the potential dilutive effects of stock options. The Company analyzed the potential dilutive effect of any outstanding dilutive securities under the “if-converted” method and treasury-stock method when calculating diluted earnings per share, in which it is assumed that the outstanding participating securities convert into common stock at the beginning of the period or date of issuance, if later. The Company reports the more dilutive of the approaches (two-class or “if-converted”) as its diluted net income per share during the period. Basic earning per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. As of December 31, 2025 and 2024, the average market prices for the three months and six months then ended are less than the exercise price of all the outstanding stock options and, therefore, the inclusion of the stock options would be anti-dilutive.


	For the Three Months Ended December 31,				For the Six Months Ended December 31,
	2025		2024		2025		2024
Numerator:
Numerator for basic loss per share:
Net income (loss)	$	97,677	$	246,021	$	(142,175)	$	213,804
Less undeclared dividends on convertible stocks	13,006		12,970		26,012		25,940
Less net income allocated to convertible preferred stocks	40,884		110,327		—		88,935
Net income (loss) applicable to common stockholders	$	43,787	$	122,724	$	(168,187)	$	98,929
Numerator for diluted earnings per share:

Net income (loss)	$	97,677	$	246,021	$	(142,175)	$	213,804
Undeclared dividends on convertible stocks	13,006		12,970		26,012		25,940
Diluted income (loss)	$	84,671	$	233,051	$	(168,187)	$	187,864

Denominator:
Denominator for basic income (loss) per share - weighted average shares outstanding	7,415,329		7,415,329		7,415,329		7,415,329
Weighted average preferred stock converted to common stock	7,008,400		6,666,287		—		6,666,287
Denominator for diluted earnings (loss) per share - weighted average and assumed conversion	14,423,729		14,081,616		7,415,329		14,081,616

Net earnings (loss) per share:
Basic net earnings (loss) per share	$	0.01	$	0.02	$	(0.02)	$	0.01
Diluted net earnings (loss) per share	$	0.01	$	0.02	$	(0.02)	$	0.01
Weighted average shares - basic	7,415,329		7,415,329		7,415,329		7,415,329
Weighted average shares - diluted	14,423,729		14,081,616		7,415,329		14,081,616


	For the Three Months Ended December 31,		For the Six Months Ended December 31,
	2025	2024	2025	2024
Stock options	21,000	21,000	21,000	21,000
Convertible preferred stock	—	—	7,008,400	—
Total potential dilutive securities not included in income per share	21,000	21,000	7,029,400	21,000

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the condensed consolidated financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the period in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The estimated annual effective tax rate is updated quarterly based on changes in the forecast of full-year income and tax expense. For the three months and six months ended December 31, 2025 and 2024, the Company’s provision for income taxes and effective tax rate were zero.

The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company will continue to maintain a full valuation allowance on its deferred tax assets until there is sufficient positive evidence to support the reversal of all or some portion of these allowances. A release of the valuation allowance would result in the recognition of certain deferred tax assets and a corresponding income tax benefit in the period the release is recorded. The amount of the valuation allowance release will be determined based on the available sources of future taxable income as of the period in which the release is recorded. As of December 31, 2025 and June 30, 2025, the Company has recorded a full valuation allowance against its deferred tax assets.

The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying unaudited condensed consolidated statements of operations. As of December 31, 2025 and June 30, 2025, no accrued interest or penalties were required to be included on the related tax liability line in the condensed consolidated balance sheets.