AAR

None of the warning signs we check for were found.

We look for five warning signs: doubt it can keep going, weak checks on its own accounts, a notice that its past accounts can't be relied on, a change of auditor, and one customer bringing in a big share of sales. We don't check lawsuits, investigations or debt yet.

We checked the auditor's report, internal controls, restatement notices, auditor changes and big customers in the 10-K filed 22 Jul 2026, plus the 10-Q filed 29 Sep 2026 and 4 later 8-Ks.

Cheap for a reason is the question the numbers cannot answer.

Whether the price already reflects the risks is what the deep dive is for.

• We do not own certain intellectual property and tooling that is important to our business, and we may be unable to protect the value of our intellectual property.

  Could happen

  In addition, we may face challenges obtaining, maintaining, and enforcing our intellectual property rights, which may diminish the value of our products and services, result in costly litigation, and otherwise negatively impact our business and financial results. We rely on and may not be able to protect our rights in the unpatented technology, trade secrets, and confidential information we use to conduct our business. Others may independently develop substantially equivalent information or techniques or otherwise gain access to or disclose our technology. When we develop intellectual property and technologies with funding from U.S. government contracts, the government has the royalty-free right to use that intellectual property. Confidentiality agreements with employees and consultants may not provide effective protection of our information or, in the event of unauthorized disclosure, may not provide adequate remedies.

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• Our U.S. government contracts may not continue at present sales levels, which may have a material adverse effect on our financial condition and results of operations.

  Could happen

  If we have a contract dispute with the government, we generally seek resolution by negotiation, requests for equitable adjustment, and/or filing formal claims with the Contracting Officer (the denial of which may be appealed formally to the appropriate Board of Contracting Appeals). The resolution strategy for disputes depends heavily upon the ongoing business relationship with the customer, and the pursuit of claims requires significant time and additional costs, including legal fees and expenses. We make assumptions on what we expect to recover in our financial statements, but we may not be able to fully recover from the financial impact of these disputes, as there is no guarantee that litigation would ultimately be successful.

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• Acquisitions, which are a part of our business strategy, expose us to risks, including the risk that we may be unable to achieve the anticipated benefits from the acquired businesses.

  Could happen

  For any businesses we acquire, we may not be able to execute our operational, financial, or integration plans for the acquired businesses. We face challenges integrating the operations of acquired businesses, some of which were not previously part of a public company. We are also subject to unexpected liabilities and costs related to the acquired businesses, which can be difficult to predict. Further, we may not be successful integrating the acquired businesses in a manner that permits us to realize all of the anticipated benefits, including any synergies, cross-selling opportunities, cost savings, or financial or business growth opportunities, in the expected timeframe, or at all. In addition, we may not be able to manage our growth successfully. Also, adjustments to preliminary purchase price allocations during the measurement period could result in changes to the carrying values of acquired assets and liabilities. All of the above could have a material adverse effect on our overall business, financial condition, results of operations and growth prospects.

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