8-K/A - POCI - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K/A

CURRENT REPORT

Pursuant to Section 13 or 15(d) ofthe Securities Exchange Act of 1934

Date of Report (Date of earliest event

reported) October 4, 2021

PRECISION OPTICS

CORPORATION, INC.

(Exact name of registrant as specified in its charter)

Massachusetts	001-10647	04-2795294
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)
22 East Broadway, Gardner, Massachusetts	01440
---	---
(Address of principal executive offices)	(Zip Code)

(978) 630-1800

(Registrant’s telephone number, including area code)

Not applicable.

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, $0.01 par value	PEYE	OTCQB

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Explanatory Note

As previously reported under items 1.01, 2.01, and 3.02 in our Current Report on Form 8-K, filed on October 8, 2021, we entered into an asset purchase agreement to purchase substantially all of the assets of Lighthouse Imaging, LLC.

This Current Report on Form 8-K/A amends the previously filed Current Report on Form 8-K by adding the financial information required by items 9.01(a) and 9.02(b) as permitted by item 9.01(a)(4) and 9.01(b)(2), respectively.

This report contains forward-looking statements. Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements related to our future activities or future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by our management. These statements are not guarantees of future performances 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 the forward-looking statements due to numerous factors, including those risks discussed in our Annual Report on Form 10-K and in other documents that we file from time to time with the SEC. Any forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this report, except as required by law.

Item 9.01.	Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired.

The audited financial statements of Lighthouse Imaging, LLC as of and for the years ended December 31, 2020 and December 31, 2019, are attached as Exhibit 99.1 to this Current Report on Form 8-K/A.

The unaudited interim financial statements of Lighthouse Imaging, LLC as of September 30, 2021 and for the nine months then ended are attached as Exhibit 99. 2 to this Current Report on Form 8-K/A.

(b) Pro Forma Financial Information.

The unaudited pro forma condensed consolidated financial information of Precision Optics Corporation, Inc. as of June 30, 2021 for the year ended June 30, 2021 and for the three-month period ended September 30, 2021 reflecting the acquisition of Lighthouse Imaging, LLC are attached as Exhibit 99.3 to this Current Report on Form 8-K/A.

(d) Exhibits.

23.1	Consent of Independent Registered Public Accounting Firm dated December 20, 2021.
99.1	Audited financial statements of Lighthouse Imaging, LLC for the years December 31, 2020 and December 31, 2019.
99.2	Unaudited interim financial statements of Lighthouse Imaging, LLC as of September 30, 2021 and for the nine months ended September 30, 2021.
99.3	Unaudited pro forma condensed consolidated financial information of Precision Optics Corporation, Inc. as of June 30, 2021 for the year ended June 30, 2021 and for the three-month period ended September 20, 2021.
104	The<br>cover page from this Current Report on Form 8-K, formatted in Inline XBRL

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Precision Optics Corporation, Inc.
	(Registrant)
Date: December 20, 2021	By:	/s/ Joseph N. Forkey
		Name: Joseph N. Forkey<br><br>Title: Chief Executive Officer

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Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTINGFIRM

We consent to the inclusion in this Current Report on Form 8-K/A of our report dated September 30, 2021, relating to the financial statements of Lighthouse Imaging LLC as of December 31, 2020 and 2019 and for the years then ended.

/s/ Stowe & Degon LLC

December 20, 2021

Westborough, Massachusetts

Exhibit 99.1

Financial Statements

For the Years Ended December 31, 2020 and 2019

Table of Contents

Independent Auditors’ Report	1
Balance Sheets	2
Statement of Operations	3
Statement of Changes in Members’ Deficit	4
Statements of Cash Flows	5
Notes to Financial Statements	6-10

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INDEPENDENT AUDITORS’ REPORT

To the Member

Lighthouse Imaging LLC

Windham, Maine

We have audited the accompanying financial statements of Lighthouse Imaging LLC, which comprise the balance sheets as of December 31, 2020 and 2019, and the related statements of operations, member’s deficit, and cash flows for the years then ended, and the related notes to the financial statements.

Management’s Responsibility for the FinancialStatements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Lighthouse Imaging LLC as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

/s/ Stowe & Degon, LLC

Westborough, Massachusetts

September 30, 2021

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Lighthouse Imaging LLC

Balance Sheets

December 31, 2020 and 2019

			2019
ASSETS
Current Assets:
Cash	151,831		$	161,720
Accounts receivable (net of allowance for doubtful accounts of 12,758 at December 31, 2020 and 0 at December 31, 2019)	365,001			439,106
Inventories	414,563			398,060
Prepaid Expense	67,584			28,109
Total current assets	998,979			1,026,995
Property and Equipment:
Machinery and equipment	193,814			170,997
Leasehold improvements	109,798			109,798
Furniture and fixtures	97,054			97,054
	400,666			377,849
Less: Accumulated depreciation and amortization	(345,434	)		(320,820	)
Net property and equipment	55,232			57,029
Other Assets:
Goodwill, net	217,738			327,238
Other Intangibles, net	20,883			24,111
Deposit	14,464			14,464
Note receivable – related party	61,780			61,780
Total other assets	314,865			427,593
TOTAL ASSETS	1,369,076		$	1,511,617
LIABILITIES AND MEMBER’S DEFICIT
Current Liabilities:
Bank line of credit	–		$	205,613
Current portion of long-term debt	–			–
Related party line of credit	1,227,210			1,578,985
Accounts payable and accrued expense	259,239			339,543
Customer deposits	630,759			247,380
Accrued employee compensation	126,534			25,222
Total current liabilities	2,243,742			2,396,743
Notes payable – related party	400,000			400,000
Member’s deficit	(1,274,666	)		(1,285,126	)
TOTAL LIABILITIES AND MEMBER’S DEFICIT	1,369,076		$	1,511,617

All values are in US Dollars.

The accompanying notes are an integral part of these financial statements.

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Lighthouse Imaging LLC

Statements of Operations

For the Years Ended December 31,2020 and 2019

	2020			2019
Revenues	$	3,709,137		$	3,193,196
Cost of goods sold		2,613,345			2,537,160
Gross profit		1,095,792			656,036
Selling, general and administrative expenses		1,303,109			1,349,081
Net loss from operations		(207,317	)		(693,045	)
Other income (expense)
Interest expense		(85,994	)		(84,366	)
Paycheck protection program loan forgiveness		320,480			–
Other		(16,709	)		12,887
		217,777			(71,479	)
NET INCOME (LOSS)	$	10,460		$	(764,524	)

The accompanying notes are an integral part of these financial statements.

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Lighthouse Imaging LLC

Statement of Changes in Members’Deficit

For the Years Ended December 31,2020 and 2019

	Members’
	Deficit
Balance, January 1, 2019	$	(472,522	)
Net loss		(764,524	)
Distribution to member		(48,080	)
Balance, December 31, 2019	$	(1,285,126	)
Net income		10,460
Balance, December 31, 2020	$	(1,274,666	)

The accompanying notes are an integral part of these financial statements.

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Lighthouse Imaging LLC

Statements of Cash Flows

For the Years Ended December 31,2020 and 2019

	2020			2019
Cash Flows from Operating Activities:
Net income (loss)	$	10,460		$	(764,524	)
Adjustments to reconcile net income to net cash provided by (used in) operating activities-
Depreciation and amortization		137,342			134,144
Paycheck Protection Program loan forgiveness		(320,480	)		–
Changes in operating assets and liabilities-
Accounts receivable		74,105			(27,167	)
Inventories		(16,503	)		21,559
Prepaid expenses and other assets		(39,475	)		120,480
Accounts payable and accrued expense		(80,304	)		101,883
Customer deposits		383,379			(27,588	)
Accrued employee compensation		101,312			(96,591	)
Net cash provided by (used in) operating activities		249,836			(537,804	)
Cash Flows from Investing Activities:
Purchases of property and equipment		(22,817	)		(15,681	)
Cash Flows from Financing Activities:
Repayment of bank line of credit, net		(205,613	)		(19,964	)
Repayment of capital lease		–			(10,058	)
Paycheck Protection Program loan proceeds		320,480			–
Net repayment (advances from) notes payable – related party		(351,775	)		719,778
Distribution to member		–			(48,080	)
Net cash (used for) provided by financing activities		(236,908	)		641,676
Net (decrease) increase in cash and cash equivalents		(9,889	)		88,191
Cash and cash equivalents, beginning of year		161,720			73,529
Cash, end of year	$	151,831		$	161,720
Supplemental disclosure of cash flow information:
Interest paid during the year	$	85,994		$	84,366

The accompanying notes are an integral part of these financial statements.

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Lighthouse Imaging LLC

Notes to Financial Statements

(1)	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a)	Nature of Business
---	---

Lighthouse Imaging LLC. (the "Company") provides optical engineering and design, assembly and manufacturing services for the medical device industry.

(b)	Revenues

The Company recognizes revenues upon shipment and transfer of control to the customer or when services have been rendered, the price to the buyer is fixed and determinable, and collectability is reasonably assured. The Company's shipping terms are typically FOB shipping point.

The sales price of products and services sold is fixed and determinable after receipt and acceptance of a customer’s purchase order or properly executed sales contract, typically before any work is performed. Management reviews each customer purchase order or sales contract to determine that the work to be performed is specified and there are no unusual terms and conditions that would raise questions as to whether the sales price is fixed or determinable. The Company assesses credit worthiness of customers based upon prior history with the customer and assessment of financial condition. Accounts receivable are stated at the amount management expects to collect from outstanding balances. An allowance for doubtful accounts is provided for that portion of accounts receivable considered to be uncollectible, based upon historical experience and management’s evaluation of outstanding accounts receivable at the end of the year. Bad debts are written off against the allowance when identified.

Contract liabilities, which were recorded as customer advances in the Company’s Consolidated Balance Sheets, and unearned revenue are comprised of the following:

	Fiscal Year Ended December,
	2021			2020
Contract liabilities, beginning of period	$	247,380		$	230,854
Unearned revenue received from customers		1,278,946			476,990
Revenue recognized		(895,567	)		(460,464	)
Contract liabilities, end of period	$	630,759		$	247,380
(c)	Cash
---	---

Cash consists primarily of amounts in bank checking accounts.

(d)	Inventories

Inventories are stated at the lower of cost (using the first-in, first-out method) and net realizable value. Work in progress and finished goods inventory primarily include material, labor and overhead.

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Components of inventory at December 31, 2020 and 2019 are as follows:

	2020		2019
Raw Materials	$	332,217	$	280,128
Work-in-progress		15,248		59,446
Finished goods		67,098		58,486
	$	414,563	$	398,060
(e)	Property and Equipment
---	---

Property and equipment are recorded at cost. Maintenance and repair items that do not improve or extend the lives of the respective assets are expensed as incurred. The Company provides for depreciation and amortization by charges to operations, using straight-line method over the appropriate useful life of the asset.

(f)	Significant Customers and Concentration of Credit Risk

Financial instruments that subject the Company to credit risk consist primarily of cash and trade accounts receivable. The Company has not experienced any losses on its cash balances to date. At December 31, 2020, the Company had five customer with accounts receivable balances of 32%, 13%, 12%, 11% and 11% of total accounts receivable.

The allowance for doubtful accounts receivable was $12,758 and $0 at December 31, 2020 and 2019, respectively, and the Company did not experience any material losses related to accounts receivable from individual customers during the years then ended. The Company generally does not require collateral or other security as a condition of sale; rather it relies on credit approval, balance limitation and monitoring procedures to control credit risk of trade account financial instruments, and occasionally requests certain orders be partially paid in advance by new customers and requests deposits for development projects. Management believes the allowance for doubtful accounts, which is established based upon review of specific account balances and historical experience, is adequate as of December 31, 2020 and 2019.

(g)	Fair Value of Financial Instruments

Financial instruments consist principally of cash, accounts receivable and accounts payable. The estimated fair value of these financial instruments approximated their carrying value due to their short-term nature.

(h)	Intangible Assets and Goodwill

Intangible assets and goodwill consist of the following at December 31, 2020:

Goodwill	$	1,095,000
Patents		48,422
		1,143,422
Less accumulated amortization		(904,801	)
	$	238,621

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Goodwill relates to the acquisition of Lighthouse Imaging in 2010. Goodwill is being amortized over 10 years using the private company alternative. The patent represents legal fees incurred related to several patent modifications and add-ons and are being amortized over the estimated useful life of the patents. Total amortization expense totaled $112,728 and $112,729 in 2020 and 2019, respectively.

Amortization expense over the next five years and thereafter is as follows for the years ending December 31:

2021	$	112,728
2022		111,465
2023		3,228
2024		3,228
2025		3,228
Thereafter		4,744
	$	238,621
(i)	Warranty Costs
---	---

The Company does not incur future performance obligations as part of sales arrangements with customers in the normal course of business. The Company does warrant its products for one year after sale. Warranty returns for damaged product are recognized in cost of goods sold in the accompanying financial statements in the year the products are returned to the Company for repair or replacement. There were no warranty repair costs during the years ended December 31, 2020 and 2019.

(j)	Income Taxes

The Company, as a limited liability company, has elected to be taxed as a partnership; therefore, income and losses are passed through to the member for tax purposes. Accordingly, no provision for income taxes has been made in the accompanying financial statements.

(k)	Research and Development

The Company does not invest in research and development activities, except in connection with a purchase order arrangement with a customer for a specific service order. Such costs are included in the cost of products sold to the customer.

(l)	Use of Estimates

The preparation of financial statements in conformity with accounting standards generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(m)	Risks and Uncertainties

The continued outbreak of COVID-19 has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and social distancing, have caused material disruption to businesses globally, resulting in an economic slowdown. The duration and impact of the COVID-19 outbreak is unknown at this time, nor is the efficacy of the government and central bank monetary and fiscal interventions designed to stabilize economic conditions. As a result, it is not possible to reliably estimate the length and severity of these developments nor the impact on the financial position and financial results of the Company in future periods.

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The Company conducts its business in a single facility in Windham, Maine pursuant to an operating lease which expires on July 31, 2025. The lease calls for monthly lease payments in the amount of $11,672. Rent expense on operating leases was $138,508 and $137,728 for the years ended December 31, 2020 and 2019 respectively.

At December 31, 2020, future minimum lease payments under the operating lease agreement through July 31, 2025 total approximately $641,960.

Minimum annual lease commitments for the next five years are as follows

2021	$	140,064
2022		140,064
2023		140,064
2024		140,064
2025		81,704
	$	641,960
(3)	FINANCING ACTIVIES
---	---
(a)	Bank Line of Credit
---	---

The Company has a $300,000 Line of Credit with a bank. The Line of Credit is secured by all business assets and is guaranteed a member. Borrowings bear interest at prime plus 1%. At December 31, 2020 there was no outstanding balance on the line and at December 31, 2019 $205,613 was outstanding on the line.

(b)	Related party line of credit

The Company has a $2,750,000 line of credit agreement with the member. Outstanding borrowing bears interest at 5% per annum. The outstanding borrowings are payable on demand and the agreement expires, unless renewed, on January 2, 2021 at which time outstanding principle and unpaid interest were due in full. Demand for payment has not been made as of September 30, 2021.

(c)	Long Term Debt

Long term debt consists of the following at December 31, 2020 and 2019:

	2020		2019
Note payable to the member bearing an interest rate of 4%. There are no payments due until the note matures on December 31, 2024 at which time all unpaid principle and interest become due.	$	400,000	$	400,000

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---
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The Company offers a 401k plan to its employees. All employees are eligible to participate in the plan as long as they are at least 21 years of age. The plan provides for matching contributions. The matching contribution charged to operations for the years ending December 31, 2020 and 2019 amounted to $30,596 and $29,896 respectively.

(5)	PAYCHECK PROTECTION PROGRAM

On April 16, 2020, the Company entered into a promissory note for an unsecured loan in the amount of $320,480 through the Paycheck Protection Program (PPP) established by the CoronavirusAid, Relief and Economic Security Act (CARES Act) and administered by the U.S. Small Business Administration (SBA). Auburn Savings Bank (the Lender) processed and funded the PPP loan. The loan bears interest at 1%, with principal and interest payments deferred for the ten months following the end of the covered period. After that, the loans and interest would be paid back over a period of 18 months if the loans are not forgiven under the terms of the PPP. When the Company applied for the loans, management believed they would qualify to have the loans forgiven under the terms of PPP. The Company formally submitted the application for forgiveness and the loan was forgiven for the full amount of $320,480 in December 2020. Total forgiveness of $320,480 is included in the accompanying statement of operations as other income for the year ended December 31, 2020.

(6)	SUBSEQUENT EVENTS

Management has evaluated subsequent events through September 30, 2021 the date the financial statements were available to be issued.

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Exhibit 99.2

Lighthouse Imaging LLC

Balance Sheets

September 30, 2021

(Unaudited)

			December 31, 2020
ASSETS
Current Assets:
Cash	323,391		$	151,831
Accounts receivable (net of allowance for doubtful accounts of 0 at September 31, 2021 and 12,578 at December 31, 2020)	794,824			365,001
Inventories	456,008			414,563
Prepaid Expense	73,125			67,584
Total current assets	1,647,348			998,979
Property and Equipment:
Machinery and equipment	213,110			193,814
Leasehold improvements	109,798			109,798
Furniture and fixtures	121,872			97,054
	444,780			400,666
Less: Accumulated depreciation and amortization	(368,888	)		(345,434	)
Net property and equipment	75,892			55,232
Other Assets:
Goodwill, net	135,613			217,738
Other Intangibles, net	18,462			20,883
Deposit	14,464			14,464
Note receivable – related party	61,780			61,780
Total other assets	230,319			314,865
TOTAL ASSETS	1,953,559		$	1,369,076
LIABILITIES AND MEMBER’S DEFICIT
Current Liabilities:
Related party line of credit	1,237,073		$	1,227,210
Accounts payable and accrued expense	365,884			259,239
Customer deposits	826,679			630,759
Accrued employee compensation	151,819			126,534
Total current liabilities	2,281,455			2,243,742
Notes payable – related party	400,000			400,000
	–			–
Member’s deficit	(1,027,896	)		(1,274,666	)
TOTAL LIABILITIES AND MEMBER’S DEFICIT	1,953,559		$	1,369,076

All values are in US Dollars.

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Lighthouse Imaging LLC

Statements of Operations

For the Nine Months Ended September30, 2021

(Unaudited)

	Nine-months Ended<br> <br>Sept 30, 2021			Year Ended<br> <br>Dec 31 2020
Revenues	$	3,942,493		$	3,709,137
Cost of goods sold		2,693,394			2,613,345
Gross profit		1,249,099			1,095,792
Selling, general and administrative expenses		1,079,353			1,303,109
Net income (loss) from operations		169,746			(207,317	)
Other income (expense)
Interest expense		(53,580	)		(85,994	)
Paycheck protection program loan forgiveness		–			320,480
Employee Retention Tax Credit		117,846			–
Other		12,758			(16,709	)
		77,024			217,777
NET INCOME	$	246,770		$	10,460

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Lighthouse Imaging LLC

Statement of Changes in Members’Deficit

For the Nine-Months Ended September30, 2021 and the Year Ended December 31, 2020

(Unaudited)

	Members’
	Deficit
Balance, January 1, 2020	$	(1,285,126	)
Net loss		10,640
Balance, December 31, 2020	$	(1,274,666	)
Net income		246,770
Balance, September 30, 2021	$	(1,027,896	)

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Lighthouse Imaging LLC

Statements of Cash Flows

For the Nine-Months Ended September30, 2021 and the Year Ended December 31, 2020

	September 30, 2021			December 31, 2020
Cash Flows from Operating Activities:
Net income (loss)	$	246,770		$	10,460
Adjustments to reconcile net income to net cash provided by (used in) operating activities-
Depreciation and amortization		108,000			137,342
Paycheck Protection Program loan forgiveness		–			(320,480	)
Changes in operating assets and liabilities-
Accounts receivable		(429,823	)		74,105
Inventories		(41,445	)		(16,503	)
Prepaid expenses		(5,541	)		(39,475	)
Accounts payable and accrued expense		106,645			(80,304	)
Customer deposits		195,920			383,379
Accrued employee compensation		25,285			101,312
Net cash provided by (used in) operating activities		205,811			249,836
Cash Flows from Investing Activities:
Purchases of property and equipment		(44,114	)		(22,817	)
Cash Flows from Financing Activities:
Repayment of bank line of credit, net		–			(205,613	)
Paycheck Protection Program loan proceeds		–			320,480
Net repayment (advances from) related party line of credit		9,863			(351,775	)
Net cash (used for) provided by financing activities		9,863			(236,908	)
Net (decrease) increase in cash and cash equivalents		171,560			(9,889	)
Cash and cash equivalents, beginning of year		151,831			161,720
Cash, end of period	$	323,391		$	151,831
Supplemental disclosure of cash flow information:
Interest paid during the period	$	52,955		$	85,994

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Exhibit 99.3

PRECISION OPTICS CORPORATION, INC.

Pro forma Financial Information

(Unaudited)

Reflecting the acquisition of certain assetsand liabilities of Lighthouse Imaging, LLC

As of June 30, 2021 For the Fiscal Year EndedJune 30, 2021 and the Three Months ended September 30, 2021

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Pro Forma Balance Sheets

As of June 30, 2021

(Unaudited)

							Adjustments
	Precision Optics Corporation, Inc.			Lighthouse Imaging, LLC.			Equity		Excluded			Net Asset			Pro Forma P&L			Pro Forma
	6/30/2021			6/30/2021			Financing		Net Assets			Purchase			Adjustments			6/30/2021
							(Note 1)		(Note 2)			(Note 3)			(Note 4)
Current Assets:
Cash and equivalents	$	861,650		$	148,335		$	4,100,000	$	(375,856	)	$	(2,854,913	)	$	(264,742	)	$	1,614,474
Accounts receivable, net		1,878,755			961,641			–		(117,846	)		–			–			2,722,550
Inventories, net		1,885,395			343,601			–		–			–			–			2,228,996
Prepaid expenses		150,635			57,805			–		–			–			–			208,440
Total current assets		4,776,435			1,511,382														6,774,460
Property and Equipment, net		594,252			65,987			–		–			28,806			8,689			697,734
Other Assets:
Due from Related Parties		–			61,780			–		(61,780	)		–			–			–
Patents		141,702			19,269			–		–			25,925			–			186,896
Operating lease right-to-use asset		61,247			–			–		–			–			–			61,247
Deposit		–			14,464			–		(5,464	)		–			–			9,000
Goodwill		687,664			162,988			–		(272,488	)		7,778,586			109,500			8,466,250
		890,613			258,501														8,723,393
TOTAL ASSETS	$	6,261,300		$	1,835,870													$	16,195,587
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of capital lease obligation	$	38,347		$	–		$	–	$	–		$	–		$	–		$	38,347
Current portion of earn out liability		166,667			–			–		–			714,375			35,625			916,667
Accounts payable		1,205,149			167,863			–		–			–			–			1,373,012
Customer advances		450,084			800,059			–		–			–			–			1,250,143
Accrued Employee Compensation		589,616			55,148			–		–			–			–			644,764
Note payable to bank – short term		–			–			340,476		(320,480	)		–			320,480			340,476
Operating Lease Liability		61,247			–			–		–			–			–			61,247
Total current liabilities		2,511,110			1,023,070														4,624,656
Related Party Line of Credit		–			1,968,229			–		(1,954,563	)		–			(13,666	)		–
Note payable to bank – long term		–			–			2,259,524		–			–			(357,763	)		1,901,761
Capital lease obligation, net of current portion		152,397			–			–		–			–			–			152,397
Earn out liability, net of current portion		166,666			–			–		–			680,442			33,933			881,041
Stockholders' Equity
Common stock		132,825			–			15,000		–			25,000			–			172,825
Additional paid-in capital		50,464,280			2,574,397			1,485,000		–			1,025,604			–			55,549,281
Retained earnings		(47,165,978	)		(3,729,826	)		–		1,441,609			2,532,983			(165,162	)		(47,086,374	)
Total Stockholders' Equity		3,431,127			(1,155,429	)													8,635,732
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,261,300		$	1,835,870													$	16,195,587

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Notes to Pro Forma Balance Sheets at June 30, 2021.

The following notes describe the pro forma adjustments made to the consolidated balance sheets of Precision Optics Corporation, Inc (“POC”) and Lighthouse Imaging, LLC. (“LHI”) as though POC acquired the LHI net assets on July 1, 2020. Prior to the acquisition of LHI by POC there were no intercompany transactions between the companies.

Note 1. Concurrent with the acquisition of LHI, POC sold 937,500 shares of common stock for $1.60 per share resulting in estimated net proceeds of $1,500,000. The net proceeds were used to partially fund the acquisition of the net operating assets of LHI. In addition, POC entered into a $2,600,000 term loan with Main Street bank.

Note 2. POC acquired certain operating assets and assumed certain operating liabilities as of the acquisition date. These adjustments reflect the removal of the assets and liabilities not acquired or assumed by POC.

Note 3. Assuming the acquisition occurred on July 1, 2020 pro forma acquisition date, POC paid $4,354.913 cash and 2,500,000 shares of POC common stock to purchase the net operating assets of LHI, including $2,854,913 at closing, and $1,500,000 subject to certain earn out criteria relating the operating performance of LHI during the first two fiscal years following the acquisition transaction. The $1,500,000 earn out payments were recorded at a present value of $714,375 for year one and $680,442 for year two. The assets acquired by POC have been recorded at their fair market value, including an increase of $28,806 from the net book value of certain fixed assets. Goodwill has also been recorded representing the excess of the consideration paid and liabilities assumed in excess of the fair market value of the assets acquired. POC believes the goodwill recorded reasonably estimates the value of the operating business of LHI including its tangible business assets and its intangible assets as a long-standing and successfully operating optics company.

Note 4. Pro forma P&L adjustments represent the effect of applying acquisition accounting to the purchase of LHI as though the transaction occurred on July 1, 2020. Included in these adjustments are the pro forma effect of adjustments to deprecation, elimination of goodwill, bank financing and related interest, amortization of the discount applied to the earn out liability and reversal of the gain recognized on the PPP liability that was treated as an excluded liability in the pro forma acquisition as of July, 2020.

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Pro Forma Balance Sheets

As of September 30, 2021

(Unaudited)

							Adjustments
	Precision Optics Corporation, Inc.			Lighthouse Imaging, LLC.			Equity		Excluded			Net Asset			Pro Forma P&L			Pro Forma
	9/30/2021			9/30/2021			Financing		Net Assets			Purchase			Adjustments			9/30/2021
							(Note 1)		(Note 2)			(Note 3)			(Note 4)
Current Assets:
Cash and equivalents	$	1,669,569		$	323,391		$	4,100,000	$	(375,856	)	$	(2,854,913	)	$	(1,345,082	)	$	1,517,109
Accounts receivable, net		1,711,192			794,824			–		(117,846	)		–			–			2,388,170
Inventories, net		2,120,890			456,008			–		–			–			–			2,576,898
Prepaid expenses		142,326			73,125			–		–			–			–			215,451
Total current assets		5,643,977			1,647,348														6,697,628
Property and Equipment, net		576,297			75,892			–		–			28,806			12,870			693,865
Other Assets:
Due from Related Parties		–			61,780			–		(61,780	)		–			–			–
Patents		147,743			18,462			–					25,925			–			192,130
Operating lease right-to-use asset		46,244			–			–					–			–			46,244
Deposit		–			14,464			–		(5,464	)		–			–			9,000
Goodwill		687,664			135,613			–		(272,488	)		7,778,586			136,875			8,466,250
		881,651			230,319														8,713,624
TOTAL ASSETS	$	7,101,925		$	1,953,559													$	16,105,117
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of capital lease obligation	$	38,923		$	–		$	–	$	–		$	–		$	–		$	38,923
Current portion of earn out liability		166,667			–			–					714,375			35,625			916,667
Accounts payable		1,286,240			365,888			–		–			–			–			1,652,128
Customer advances		336,572			826,679			–		–			–			–			1,163,251
Accrued Employee Compensation		883,770			151,818			–		–			–			–			1,035,588
Note payable to bank – short term		–			–			340,476		(320,480	)					320,480			340,476
Operating Lease Liability		46,244			–			–		–			–			–			46,244
Total current liabilities		2,758,416			1,344,385														5,193,277
Related Party Line of Credit		–			1,637,073			–		(1,954,563	)		–			317,490			–
Note payable to bank – long term		–			–			2,259,524		–			–			(781,775	)		1,477,749
Capital lease obligation, net of current portion		142,446			–			–		–						–			142,446
Earn out liability, net of current portion		166,666			–			–		–			680,442			42,839			889,947
Stockholders' Equity
Common stock		132,825			–			15,000		–			25,000			–			172,825
Additional paid-in capital		50,614,351			2,574,397			1,485,000		–			1,025,604			–			55,699,352
Common stock subscribed		1,030,000			–			–		–			–			(1,030,000	)		–
Retained earnings		(47,742,779	)		(3,602,296	)		–		1,441,609			2,532,983			(99,995	)		(47,470,479	)
Total Stockholders' Equity		4,034,397			(1,027,899	)													8,401,698
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	7,101,925		$	1,953,559													$	16,105,117

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Notes to Pro Forma Balance Sheets at September 30, 2021.

The following notes describe the pro forma adjustments made to the consolidated balance sheets of Precision Optics Corporation, Inc (“POC”) and Lighthouse Imaging, LLC (“LHI”) as though POC acquired the LHI net assets on July 1, 2020. Prior to the acquisition of LHI by POC there were no intercompany transactions between the companies.

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Pro Forma Statements of Operations

Year Ended June 30, 2021

(Unaudited)

							Adjustments
	Precision Optics Corporation, Inc.			Lighthouse Imaging, LLC.			Imputed & Bank		Depr & Amort			Management			SBA Grant & Tax		Pro Forma Year Ended
	6/30/2021			6/30/2021			Interest		Adjustment			Fee			Credit		6/30/2021
							(Note 1)		(Note 2)			(Note 3)			(Note 4)
Revenues	$	10,674,907		$	4,951,838		$	–	$	–		$	–		$	–	$	15,626,745
Cost of goods sold		7,241,322			3,378,180			–		(10,117	)		–			–		10,609,385
Gross Profit		3,433,585			1,573,658													5,017,360
Research and development expenses		624,253			–			–		–			–			–		624,253
Selling, general and administrative expense		3,714,915			1,489,127			–		(108,072	)		(135,725	)		–		4,960,245
		4,339,168			1,489,127													5,584,498
Net income (loss) from operations		(905,583	)		84,531			–		–			–			–		(567,138	)
Other (income) expense
Interest expense		5,302			42,397			98,596		–			–			–		146,295
Other		(808,962	)		(320,480	)		–		–			–			320,480		(808,962	)
Net income (loss) before taxes		(101,923	)		362,614			–		–			–			–		95,529
Income tax expense		912			–			–		–			–			–		912
Net income (loss)	$	(102,835	)	$	362,614												$	94,617

Notes to Pro Forma Statements of Operations for the year endedJune 30, 2021

The following notes describe the pro forma adjustments made to the consolidated statements of operations of Precision Optics Corporation, Inc (“POC”) and Lighthouse Imaging, LLC (“LHI”) for the year ended June 30, 2021 as though POC acquired the LHI net assets as of July 1, 2020. Prior to the acquisition of LHI by POC there were no intercompany transactions between the companies.

Note 1. POC entered into a $2,600,000 term loan with Main Street Bank to partially fund the LHI net asset purchase. The interest that would have been incurred in the year ended June 30, 2021 would have been $106,470. The $1,500,000 earn out ($750,000 per year for years one and two) was recorded at present value. The imputed income related to this transaction for the year ended June 30, 2021 was $69,558 ($35,625 and $33,933 for year one and two respectively. These two expenses have been added to the pro forma statement of operations. Lighthouse incurred interest expense of $77,431 related to a related party note that was excluded from the asset purchase. This expense has been removed from the pro forma statement of operations.

Note 2. Although fixed assets were written up by $28,806 their fair market value the resulting depreciation assuming a five year useful life is lower than the actual depreciation recorded during this period therefore there is a reduction added to this pro forma statement of operations. POC did not assume the Goodwill LHI was holding at the time of the transaction, therefore $109,500 of amortization for the year ended June 30, 2021 was added back to the pro forma statement of operations.

Note 3. LHI was incurring a management fee related to certain administrative functions provided by Anania & Associates. POC does not plan to incur any additional costs to provide these management services therefore the amount therefore the expense was removed from the pro forma statement of operations.

Note 4. LHI received Other Income from the forgiveness of the SBA Payroll Protection Program note. POC did not assume this liability and therefore the income relating to the forgiveness has been removed from the pro forma statement of operations.

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Pro Forma Statements of Operations

Three Months Ended September 30, 2021

(Unaudited)

							Adjustments
	Precision Optics Corporation, Inc.			Lighthouse Imaging, LLC.			Imputed & Bank		Depr & Amort			Management			SBA Grant & Tax		Pro Forma Year Ended
	9/30/2021			9/30/2021			Interest		Adjustment			Fee			Credit		9/30/2021
							(Note 1)		(Note 2)			(Note 3)			(Note 4)
Revenues	$	2,336,344		$	1,444,337		$	–	$	–		$	–		$	–	$	3,780,681
Cost of goods sold		1,697,312			1,059,003			–		(3,071	)		–			–		2,753,243
Gross Profit		639,036			385,334			–		–			–			–		1,027,438
Research and development expenses		105,186			–			–		–			–			–		105,186
Selling, general and administrative expense		1,105,798			371,989			–		(28,484	)		(35,007	)		–		1,414,296
		1,210,984			371,989													1,519,482
Net income (loss) from operations		(571,952	)		13,345			–		–			–			–		(492,044	)
Other (income) expense
Interest expense		4,849			16,417			18,954		–			–			–		40,220
Other		–			(130,604	)		–		–			–			117,846		(12,758	)
Net income (loss) before taxes		(576,801	)		127,532			–		–			–			–		(519,506	)
Income tax expense		–			–			–		–			–			–		–
Net income (loss)	$	(576,801	)	$	127,532												$	(519,506	)

Notes to Pro Forma Statements of Operations for the three monthsended September 30, 2021

The following notes describe the pro forma adjustments made to the consolidated statements of operations of Precision Optics Corporation, Inc (“POC”) and Lighthouse Imaging, LLC (“LHI”) for the three months ended September 30, 2021 as though POC acquired the LHI net assets as of July 1, 2020. Prior to the acquisition of LHI by POC there were no intercompany transactions between the companies.

Note 1. POC entered into a $2,600,000 term loan with Main Street Bank to partially fund the LHI net asset purchase. The interest that would have been incurred in the three-month period ending September 30, 2021 would have been $26,464. The $750,000 earn for year two was recorded at present value. The imputed income related to this transaction for the three months ended September 30, 2021 was $8,906. These two expenses have been added to the pro forma statement of operations. Lighthouse incurred interest expense of $16,417 related to a related party note that was excluded from the asset purchase. This expense has been removed from the pro forma statement of operations.

Note 2. Although fixed assets were written up by $28,806 their fair market value the resulting depreciation assuming a five year useful life is lower than the actual depreciation recorded during this period therefore there is a reduction added to this pro forma statement of operations. POC did not assume the Goodwill LHI was holding at the time of the transaction, therefore $27,375 of amortization for the three-months ended September 30, 2021 was added back to the pro forma statement of operations.

Note 4. LHI received Other Income from the receipt of the Employee Retention Tax Credit. POC did not assume this asset and therefore the income relating to the receipt of this credit has been removed from the pro forma statement of operations.

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