PRO DEX INC

Previous wording

The following discussion and analysis provides information that management believes is relevant to an assessment and understandingofthe results of operations and financial condition of Pro-Dex, Inc. (“Company,” “Pro-Dex,” “we,” “our,” or “us”) for the three-month and nine-month periods ended March 31, 2026 and 2025. This discussion should be read in conjunction with the condensed consolidated financial statements and the notes thereto included elsewherein this report. This report contains certain forward-looking statements and information. The cautionary statements included herein should be read as being applicable to all related forward-looking statements wherever they may appear. Our actual future results could differ materially from those discussed herein.

Current wording

The following discussion and analysis provides information that management believes is relevant to an assessment and understandingofthe results of operations and financial condition of Pro-Dex, Inc. (“Company,” “Pro-Dex,” “we,” “our,” or “us”) for the three-month periods ended September 30, 2026 and 2025. This discussion should be read in conjunction with the condensed consolidated financial statements and the notes thereto included elsewherein this report. This report contains certain forward-looking statements and information. The cautionary statements included herein should be read as being applicable to all related forward-looking statements wherever they may appear. Our actual future results could differ materially from those discussed herein.

Previous wording

Except for the historical information contained herein, the matters discussed in this report, including, but not limited to, discussions ofour product development plans, business strategies, strategic opportunities, and market factors influencing our results, areforward-looking statements that involve certain risks and uncertainties. Actual results may differ from those anticipated by us as aresultof various factors, both foreseen and unforeseen, including, but not limited to, our abilityto continueto develop new products and increase salesin markets characterized by rapid technological evolution, our ability to integrate and effectively operate Advanced Precision Machining, LLC (“APM”), our ability to service our debt and remain in compliance with our related covenants, consolidation within our target marketplace and among our competitors, the impact of tariffs on the cost of our raw materials and purchased components, employee turnover, competition from larger, better capitalized competitors, and our ability to realize returns on opportunities. Many other economic, competitive, governmental, and technological factors could impact our ability to achieve our goals. You are urged to review the risks, uncertainties, and other cautionary language described in this report, as well as inour other public disclosures and reports filed with the Securities and Exchange Commission (“SEC”) from time to time, including, but not limited to, the risks, uncertainties, and other cautionary language discussed in our Annual Report on Form 10-K for our fiscal year ended June 30, 2025.

Current wording

Except for the historical information contained herein, the matters discussed in this report, including, but not limited to, discussions ofour product development plans, business strategies, strategic opportunities, contract negotiations, and market factors influencing our results, areforward-looking statements that involve certain risks and uncertainties. Actual results may differ from those anticipated by us as aresultof various factors, both foreseen and unforeseen, including, but not limited to, our abilityto continueto develop new products and increase salesin markets characterized by rapid technological evolution, consolidation within our target marketplace and among our competitors, employee turnover, competition from larger, better capitalized competitors, and our ability to realize returns on opportunities. Many other economic, competitive, governmental, and technological factors could impact our ability to achieve our goals. You are urged to review the risks, uncertainties, and other cautionary language described in this report, as well as inour other public disclosures and reports filed with the Securities and Exchange Commission (“SEC”) from time to time, including, but not limited to, the risks, uncertainties, and other cautionary language discussed in our Annual Report on Form 10-K for our fiscal year ended June 30, 2026.

Previous wording

We specialize in the design, development, and manufacture of autoclavable, battery-powered, and electric, multi-function surgical drivers and shavers used primarily in the orthopedic, thoracic, and maxocranial facial (“CMF”) markets. We have patented adaptive torque-limiting software and proprietary sealing solutions which appeal to our customers, primarily medical device distributors. We also manufacture and sell rotary air motors to a wide range of industries, and precision machined parts and assemblies for the aerospace and defense industries through our APM subsidiary.

Current wording

We specialize in the design, development, and manufacture of autoclavable, battery-powered and electric, multi-function surgical drivers and shavers used primarily in the orthopedic, thoracic, and craniomaxillofacial (“CMF”) markets. We have patented adaptive torque-limiting technology and proprietary sealing solutions that appeal to our customers, primarily medical device distributors. Additionally, we provide engineering, quality, and regulatory consulting services to our customers. We also manufacture and sell rotary air motors to a wide range of industries; however, these motors comprise a de minimis portion of our business. Beginning in fiscal 2026, we began selling precision machined parts and assemblies for the aerospace and defense industries through our newly acquired subsidiary, Advanced Precision Machining, LLC (“APM”).

Previous wording

Our principal headquarters are located at 2361 McGaw Avenue, Irvine, California 92614 and our phone number is (949) 769-3200. Our Internet addresses are www.pro-dex.com and www.advanced-precision.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, amendments to those reports, and other SEC filings are available free of charge through our website as soon as reasonably practicable after such reports are electronically filed with, or furnished to, the SEC. In addition, our Code of Ethics and other corporate governance documents may be found on our website at the Pro-Dex, Inc. Internet address set forth above. Our filings with the SEC may also be read and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.govand company specific information at www.sec.gov/edgar/searchedgar/companysearch.html.

Current wording

Our principal headquartersare located at 2361 McGaw Avenue, Irvine, California 92614 and our phone number is (949) 769-3200. Our Internet address iswww.pro-dex.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, amendments tothose reports, and other SEC filings are available free of charge through our website as soon as reasonably practicable after such reportsare electronically filed with, or furnished to, the SEC. Inaddition, our Code of Ethics and other corporate governance documents may be found on our website at the Internet address set forth above. Our filings with the SEC may also be read and copied at the SEC’s Public Reference Room at 100 FStreet, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room bycalling the SEC at 1-800-SEC-0330. The SEC maintainsan Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov and company specific information atwww.sec.gov/edgar/searchedgar/companysearch.html.

Previous wording

The condensed consolidated results of operations presented in this report are not audited and are not necessarily indicative of the results to be expected for the entirety of the fiscal year ending June 30, 2026, or any other interim period during such fiscal year. Our fiscal year ends on June 30 and our fiscal quarters end on September 30, December 31, and March 31. Unless otherwise stated, all dates refer to our fiscal year and those fiscal quarters.

Current wording

The condensed consolidated results of operations presented in this report are not audited and those results are not necessarily indicative of the results to be expected for the entirety of our fiscal year ending June 30, 2027, or any other interim period during such fiscal year. Our fiscal year ends on June 30 and our fiscal quarters end on September 30, December 31, and March 31. Unless otherwise stated, all dates refer to our fiscal year and those fiscal quarters.

Previous wording

Our condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States. The preparation of our financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. 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. Actual results may differ from these estimates.

Current wording

Our financial statements are prepared in accordance with U.S. GAAP. The preparation of our financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. 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. Actual results may differ from these estimates.

Previous wording

An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used or changes in the accounting estimate that are reasonably likely to occur could materially change the financial statements. Management believes that there have been no significant changes during the three and nine months ended March 31, 2026 to the items that we disclosed as our critical accounting policies in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025.

Current wording

An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used or changes in the accounting estimate that are reasonably likely to occur could materially change the financial statements. Management believes that there have been no significant changes during the three months ended September 30, 2026, to the items that we disclosed as our critical accounting policies and estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for our fiscal year ended June 30, 2026.

Previous wording

We are also working to build top-line sales through active proposals of new medical device products with new and existing customers. Our patented adaptive torque-limiting software has been very well received in the CMF and thoracic markets. Additionally, our latest Pro-Dex branded product, the Helios driver for CMF applications, featuring our adaptive torque-limiting software, is expected to be released for production later this fiscal year. While we have had interest in this product, there is no guarantee that our existing customers or new customers will purchase this new driver.

Current wording

We are also working to build top-line sales through active proposals of new medical device products with new and existing customers. Our patented adaptive torque-limiting software has been very well received in the CMF and thoracic markets. Additionally, our latest Pro-Dex branded product, the Helios driver for CMF applications, featuring our adaptive torque-limiting software, has been released for production. Although this product has been released, and we have had interest in this product, there is no guarantee that our existing customers or new customers will purchase this new driver.

Previous wording

In November 2020, we purchased an approximate 25,000 square foot industrial building in Tustin, California (the “Franklin Property”). This building is located approximately four miles from our Irvine, California headquarters and was acquired to provide us additional capacity for our expected continued future growth, including anticipated expanded capacity for the manufacture of batteries and new products. We began operations in the new facility during the fourth quarter of fiscal 2023 and believe that the additional capacity will allow for our continued expected growth.

Current wording

In November 2020, we purchased an approximate 25,000 square foot industrial building in Tustin, California (the “Franklin Property”). This building is located approximately four miles from our Irvine, California headquarters and was acquired to provide us additional capacity for our expected continued future growth.

Previous wording

Our current objectives are focused primarily on maintaining our relationships with our current medical device customers, successfully integrating and operating APM, investing in research and development activities to design unique medical devices as well as Pro-Dex branded drivers to leverage our torque-limiting software, and promoting active product development proposals to new and existing customers for both orthopedic shavers and screw drivers for a multitude of surgical applications, while monitoring closely the progress of all these individual endeavors. While we expect revenue growth in the future, it may not be a consistent trajectory but rather periods of incremental growth that current expenditures are helping to create. However, there can be no assurance that we will be successful in any of these objectives.

Current wording

In summary, our current objectives are focused primarily on maintaining our relationships with our current medical device customers, successfully integrating and operating APM, investing in research and development activities to design unique medical devices as well as Pro-Dex branded drivers to leverage our torque-limiting software, and promoting active product development proposals to new and existing customers for both orthopedic shavers and screw drivers for a multitude of surgical applications, while monitoring closely the progress of all these individual endeavors. While we expect revenue growth in the future, it may not be a consistent trajectory but rather periods of incremental growth that current expenditures are helping to create. However, there can be no assurance that we will be successful in any of these objectives.

Previous wording

The majority of our revenue isderived from designing, developing, and manufacturing surgical devices for the medical device industry. The proportion of total salesby type is as follows (in thousands, except percentages):

Current wording

The majority of our revenue isderived from designing, developing, manufacturing, and repairing surgical devices. We continue to sell our rotary air motors for industrial and scientific applications, but our focus remains in medical devices. The proportion of total sales by type is as follows (in thousands, except percentages):

Previous wording

Certain of our medical device products utilize proprietary designs developed byus under exclusive development and supply agreements. All of our medical device products utilize proprietary manufacturing methods and know-how, and are manufactured eitherin our Costa Mesa or Irvine, California facilities, and are assembled in our Tustin, California facility, along with our industrial products. Details of our medical device sales by type is as follows (in thousands, except percentages):

Current wording

Certain of our medical device products utilize proprietary designs developed byus under exclusive development and supply agreements. All of our finished medical device products utilize proprietary manufacturing methods and know-how, and are manufactured in our Irvine, California facility and assembled in our Tustin, California facility. Details of our medical device sales by type is as follows (in thousands, except percentages):

Previous wording

Sales of our medical device products increased $4.3 million, or 36%, and $11.7 million, or 35%, respectively, for the three and nine months ended March 31, 2026, compared to the corresponding periods of the prior fiscal year. Our medical device revenue to our largest customer, included in orthopedic sales above, increased $4.5 million and $11.4 million, respectively, for the three and nine months ended March 31, 2026, compared to the corresponding periods of the prior fiscal year. As previously discussed, our largest customer executed a contract amendment which extends the contract through 2028 and also provides for higher volumes of their newest surgical handpiece. Therefore, we expect to see similar levels of revenue reported in orthopedic sales through 2028. Additionally, recurring revenue from distributors of thoracic drivers decreased $389,000 and $1.8 million, respectively, for the three and nine months ended March 31, 2026, compared to the corresponding periods of the prior fiscal year. Our CMF sales revenue increased $252,000 and $2.1 million, for the three and nine months ended March 31, 2026, respectively, compared to the corresponding periods of the prior fiscal year. While we do not have much visibility into our customers’ distribution networks, this level of change in thoracic and CMF sales (whether an increase or decrease) is not uncommon and fluctuations occur based upon required inventory levels.

Current wording

Our medical device revenue increased $3.0 million, or 21%, for the three months ended September 30, 2026, compared to the corresponding period of the prior fiscal year. Our orthopedic sales increased $1.8 million, or 16%, for the three months ended September 30, 2026, compared to the corresponding period of the prior fiscal year, due primarily to increased sales of our largest customer’s next generation handpiece. We expect to see similar sales volumes of our largest customer’s next generation and legacy handpiece for the remainder of this fiscal year. Currently, the exclusive supplier used to provide the proprietary medical grade finish of many parts of the next generation handpiece is experiencing delays in shipments to us. While the supplier has represented to us that shipments will resume on a timely basis by mid-November, there is a risk that we may fall behind in our shipments to our largest customer, especially if the aforementioned customer mandated supplier is unable to meet their communicated schedule. Recurring revenue from distributors of CMF drivers increased $1.1 million, or 39%, for the three months ended September 30, 2026, compared to the corresponding period of the prior fiscal year. Our thoracic sales increased by $150,000, or 30%, for the three months ended September 30, 2026, compared to the corresponding period of the prior fiscal year. While we do not have much visibility into our customers’ distribution networks, this level of change (whether an increase or decrease) is not uncommon and fluctuations occur based upon required inventory levels.

Previous wording

Repair revenue decreased $2.4 million or 48%, and $5.4 million, or 36%, for the three and nine months ended March 31, 2026, respectively, compared to the corresponding periods of the prior fiscal year due to fewer repairs of the legacy orthopedic handpiece we sell to our largest customer. While we do not have much visibility into our largest customer’s distribution networks, they may be reducing repairs of legacy handpieces in favor of replacing them with the next generation handpiece, in which case we may continue to experience future declines in repair revenue.

Current wording

Repair revenue decreased by $1.7 million, or 44%, for the three months ended September 30, 2026, compared to the corresponding period of the prior fiscal year, due to fewer repairs of the legacy orthopedic handpiece we sell to our largest customer. While we do not have much visibility into our largest customer’s distribution networks, they may be reducing repairs of legacy handpieces in favor of replacing them with the next generation handpiece, in which case we may continue to see declines in repair revenue.

Previous wording

At March 31, 2026, we had a backlog of approximately $39.0 million, of which $15.6 million is scheduled to be delivered in the fourth quarter of fiscal 2026 and the balance is scheduled to be delivered next fiscal year. Our backlog represents firm purchase orders received and acknowledged from our customers and does not include all revenue expected to be generated from existing customer contracts. We may experience variability in our new order bookings due to various reasons, including, but not limited to, the timing of major new product launches and customer planned inventory builds. However, we do not typically experience seasonal fluctuations in our shipments and revenues.

Current wording

At September 30, 2026, we had a backlog of approximately $43.1 million, of which $42.4 million is scheduled for delivery during the remainder of fiscal 2027. Our backlog represents firm purchase orders received and acknowledged from our customers and does not include all revenue expected to be generated from existing customer contracts. Wemay experience variability in our new order bookings due to various reasons, including, but not limited to, the timing of major new product launches and customer planned inventory builds. However, we do not typically experience seasonal fluctuations in our shipments and revenues.

Previous wording

Gross profit increased by approximately $335,000, or 6%, for the three months ended March 31, 2026, compared to the corresponding period of the prior fiscal year, primarily as a result of the increase in medical device revenue for the same periods as described above. Gross margin as a percentage of sales decreased by approximately 2 percentage points compared to the corresponding period of the prior fiscal year due primarily to unfavorable product mix.

Current wording

Gross profit increased by approximately $1.5 million, or 28%, for the three months ended September 30, 2026 compared to the corresponding period of the prior fiscal year, and gross margin as a percentage of sales increased by four percentage points between such periods, primarily due to favorable product mix.

Previous wording

Selling expenses consist of salaries and other personnel-related expenses for our business development department, as well as advertising and marketing expenses, and travel and related costs incurred in generating and maintaining our customer relationships. Selling expenses for the three and nine months ended March 31, 2026, decreased $73,000, or 65%, and $58,000, or 28%, respectively, compared to the corresponding periods of fiscal 2025. The decrease in selling expenses relates to a reduction in personnel costs as currently we have no employees in the department.

Current wording

Selling expenses consist of salaries and other personnel-related expenses in support of business development, as well as trade show attendance, advertising and marketing expenses, and travel and related costs incurred in generating and maintaining our customer relationships. Selling expenses for the three months ended September 30, 2026, decreased $50,000, or 69%, compared to the corresponding period of the prior fiscal year. The decrease relates to personnel costs related to our former Director of Business Development whose employment with us ended in the second quarter of fiscal 2026. The current year expenses relate primarily to recruiting fees.

Previous wording

General and administrative expenses (“G&A”) consist of salaries and other personnel-related expenses of our accounting, finance, facilities, business systems, and human resource personnel, as well as costs for outsourced information technology services, professional fees, directors’ fees, and other costs and expenses attributable to being a public company. G&A increased $1.1 million and $1.6 million, respectively, during the three and nine months ended March 31, 2026, when compared to the corresponding periods of the prior fiscal year. The increase relates to increased personnel costs of approximately $200,000 and $500,000 for the three and nine months ended March 31, 2026, respectively, as well as G&A expenses of our newly acquired subsidiary APM, which accounted for $233,000 of the increase during the three and nine months ended March 31, 2026. Additionally, consulting fees paid to the seller of APM contributed to an increase of $250,000 for the three and nine months ended March 31, 2026. In the current fiscal year, we have increased bonus accruals including the second quarter bonus accrual earned and paid to our CEO in the amount of $225,000. Additionally, we incurred increased legal and professional services fees related to the APM acquisition along with our new debt agreements.

Current wording

General and administrative expenses (“G&A”) consist of salaries and other personnel-related expenses of our accounting, finance, facilities, information technology and human resources personnel, as well as costs for outsourced information technology services, professional fees, directors’ fees, and other costs and expenses attributable to being a public company. G&A expenses increased by $692,000, or 49%, for the three months ended September 30, 2026, when compared to the corresponding period of the prior fiscal year. The increase in total G&A expenses is due to $466,000 in APM’s separate general and administrative expenses and $195,000 in higher payroll and personnel expenses related to expansion in human resources, accounting, mergers and acquisitions and information technology.

Previous wording

Research and development costs generally consist of salaries, employer-paid benefits, and other personnel- related costs of our engineering and support personnel, as well as allocated facility and information technology costs, professional and consulting fees, patent-related fees, lab costs, materials, and travel and related costs incurred in the development and support of our products. Research and development costs for the three and nine months ended March 31, 2026, decreased $120,000, or 13%, and $403,000, or 15%, compared to the corresponding periods of the prior fiscal year. The decrease relates to an increase in billable project expenses in the current fiscal year versus the prior fiscal year, which costs get reclassified to cost of sales, as well as a reduction in legal costs related to intellectual property matters. The nine-month period ended March 31, 2025 also included recruiting fees in the amount of $78,000 which did not recur during the current fiscal year.

Current wording

Research and development costs generally consist of compensation and other personnel-related costs of our engineering and support personnel, related professional and consulting fees, patent-related fees, lab costs, materials, and travel and related costs incurred in the development and support of our products. Research and development costs increased $442,000, or 58%, for the three months ended September 30, 2026 compared to the corresponding period of the prior fiscal year. The increase is due primarily to an increase in personnel expenses in the amount of $270,000 and internal project expenditures of $110,000 and approximately $25,000 less in billable projects, which expenses get reclassified to cost of sales.

Previous wording

Interest income for the three and nine months ended March 31, 2026 and 2025, includes interest and dividends from our money market accounts and investment portfolio.

Current wording

The interest and dividend income recorded during the three months ended September 30, 2026 and 2025, consists primarily of interest and dividends from our investments and money market accounts.

Previous wording

Interest expense consists primarily of interest expense related to the notes payable described more fully in Note 12 to the condensed consolidated financial statements contained elsewhere in this report.

Current wording

The unrealized gain on marketable securities for the quarters ended September 30, 2026 and 2025, relates to our portfolio of investments described more fully in Note 4 to the condensed consolidated financial statements contained elsewhere in this report.

Previous wording

The effective tax rate for each of the three months ended March 31, 2026 and 2025 was 26% and 28%, respectively. These tax rates are consistent with our combined expected federal and applicable state corporate income tax rates, and the current year decrease is attributable to the expanded state tax nexus into Florida and Indiana which have lower tax rates than California. The effective tax rate for the nine months ended March 31, 2026 and 2025 was 25% and 26%, respectively. The prior year rate was slightly less than our combined expected federal and applicable state corporate income tax rates due to a tax benefit recognized as a result of common stock awarded to employees under previously granted performance awards in the first quarter of fiscal 2025 as described more fully in Note 10 to the condensed consolidated financial statements contained elsewhere in this report.

Current wording

The effective tax rate for the three months ended September 30, 2026 and 2025, was 10% and 25%, respectively. The current year effective tax rate is less than the prior year rate due primarily to a tax benefit recognized as a result of the common stock awarded to our employees under previously granted performance awards.

Previous wording

Cash and cash equivalents at March 31, 2026, increased $9.6 million to $10.0 million as compared to $419,000 at June 30, 2025. The following table includes a summary of our condensed statements of cash flows contained elsewhere in this report.

Current wording

Cash and cash equivalents at September 30, 2026, increased $3.6 million to $11.8 million as compared to $8.2 million at June 30, 2026. The following table includes a summary of our condensed consolidated statements of cash flows contained elsewhere in this report.

Previous wording

As of March 31, 2026, our working capital was $39.1 million. We currently believe that our existing cash and cash equivalents coupled with our accounts receivable balances as well as our expected cash flows from operations will provide us with sufficient funds to satisfy our cash requirements as our business is currently conducted for at least the next 12 months.

Current wording

As of September 30, 2026, our working capital was $41.1 million. We currently believe that our existing cash and cash equivalent balances together with our accounts receivable balances will provide us sufficient funds to satisfy our cash requirements as our business is currently conducted for at least the next 12 months. In addition, we expect to derive a portion of our liquidity from our cash flows from operations.

Previous wording

We are focused on maximizing our working capital by monitoring expenses, identifying cost savings, and investing only in those development programs and products that we believe will most likely contribute to our profitability. As we execute on our current strategy, however, we may require debt and/or equity capital to fund our working capital needs and requirements for capital equipment to support our manufacturing, assembly, and inspection processes. In particular, we have experienced negative operating cash flow in the past, especially as we procure long-lead time materials to satisfy our backlog, which can be subject to extensive variability. We believe that if we need additional capital to fund our operations, we can borrow against our revolving loan with UMB which has an available balance of $11.0 million as of March 31, 2026.

Current wording

We are focused on preserving our cash balances by monitoring expenses, identifying cost savings, and investing only in those development programs and products that we believe will most likely contribute to our profitability. As we execute on our current strategy, however, we may require debt and/or equity capital to fund our working capital needs and requirements for capital equipment to support our manufacturing and inspection processes. In particular, we have experienced negative operating cash flow in the past, especially as we procure long-lead time materials to satisfy our backlog, which can be subject to extensive variability. We believe that if we need additional capital to fund our operations, we can borrow against our revolving loan with UMB which has an available balance of $11 million as of September 30, 2026.