Company: PDEX
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001079973-25-001655
Chunk: 9

Company: PRO DEX INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Item 8
Chunk 9
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 expected federal and applicable state corporate income tax rates due primarily to federal and state research credits.
Additionally, during the first quarter of fiscal 2026, we have added Florida and Indiana to our income tax nexus and both of these states
have a lower income tax rate than California, where the majority of our state income tax has been paid historically. We are currently
evaluating the impact of these changes to our deferred tax assets, and plan to record any adjustment in the second quarter of this fiscal
year, but we do not expect a material change as a result.

We
are subject to U.S. federal income tax, as well as income tax of California, Colorado, Florida and Indiana as well as Massachusetts through
fiscal year ended June 30, 2024. We are currently open to audit under the statute of limitations by the Internal Revenue Service for
the years ended June 30, 2022, and later. However, because of our prior net operating losses and research credit carryovers, our tax
years from June 30, 2020, are open to audit. We do not anticipate a significant change to the total amount of unrecognized tax benefits
within the next 12 months. 

Additionally, the One Big Beautiful Bill Act of 2025, or the 2025 Act, enacted on July 4, 2025, makes changes
to U.S. corporate income taxes including reinstating the option to claim 100% accelerated depreciation deductions on qualified property,
with retroactive application beginning January 20, 2025, and immediate expensing of research and development costs, with retroactive
application for tax years starting after December 31, 2025. We are continuing our evaluation of the impact the adoption of the 2025 Act
will have on our financial statements for the fiscal year ended June 30, 2026.

NOTE 9. SHARE-BASED COMPENSATION

In September 2016, our Board
approved the establishment of the 2016 Equity Incentive Plan, which was approved by our shareholders at our 2016 Annual Meeting. The 2016
Equity Incentive Plan provides for the award of up to 1,500,000 shares of our common stock in the form of incentive stock options, nonstatutory
stock options, stock appreciation rights, restricted shares, restricted stock units, performance awards, and other stock-based awards.
As of September 30, 2025, performance awards for 200,000 shares