Precision Optics Acquires Lighthouse Imaging, a Leading Optical Imaging Electronics and Systems Company

Company schedules conference call to discuss acquisition for today, Tuesday, October 5, 2021 at 4:15pm ET

GARDNER, Mass. and WINDHAM, Maine, Oct. 5, 2021 /PRNewswire/ -- Precision Optics Corporation, Inc. (OTCQB: PEYE), a leading designer and manufacturer of advanced optical instruments for the medical and defense industries, announced it has completed the acquisition of substantially all of the assets of Lighthouse Imaging LLC ("Lighthouse Imaging"), a private equity held company based in Windham, Maine. The acquisition combines two of the industry's leaders in medical optics and digital imaging, leveraging Precision Optics next generation capabilities in micro-optics and optical systems with Lighthouse Imaging's advanced capabilities and strong reputation in leading-edge optical imaging electronics and system integration.

"This is an exciting time for Precision Optics, Lighthouse Imaging, our employees, our customers and our shareholders as we bring together two of the medical industry's leaders in the development and manufacture of imaging systems," commented Joe Forkey, President and CEO of Precision Optics. "This strategic merger expands the depth and breadth of each company's capabilities, and we believe it will enhance our presence in the medical device industry. We expect this combination will accelerate the growth both of our companies have experienced in this market, as we increase our ability to assist our customers in developing next generation applications which are helping to change the future of healthcare."

Founded in the late 1980s, Lighthouse Imaging in recent years has transitioned its business model to leverage its unique optical imaging electronics and systems engineering capabilities to assist medical device companies developing next generation applications. Lighthouse Imaging had revenues of $4.5 million and EBITDA of $232,000 for the 12-month period ended June 30, 2021, with approximately 66% of its revenue attributable to engineering services, and the remainder attributable to production activities. Precision Optics and Lighthouse Imaging believe up to four new projects should transition from engineering to production in the coming year, providing opportunities for significant growth going forward. Additionally, Lighthouse Imaging has a robust and expanding project pipeline.

Lighthouse Imaging was most recently owned by Anania & Associates Investment Company, a private equity firm focusing on Maine-based companies. Peter V. Anania, its president and chairman, will join Precision Optics' board of directors. Lighthouse Imaging's management team, including Chief Executive Officer Tom Snyder, Chief Commercial Officer Robert Austring, and Chief Technology Officer Benjamin Gray, have agreed to continue with the combined company.

Tom Snyder commented, "On behalf of Lighthouse owners and employees, I want to convey our excitement about merging these two industry leading companies. Thanks to a strong team and excellent partnerships with our customers, Lighthouse is poised for organic growth. We have a strong project portfolio and expect multiple products to transfer to manufacturing over the next 6-12 months. We have also been exploring investments in our business. This merger provides many of the benefits we were looking to acquire. I'm confident that together, Lighthouse and Precision Optics are better positioned to address a robust medical imaging market and drive additional growth."

Dr. Forkey continued, "I'm thrilled Peter will be joining our board and Tom and the rest of the management team will continue after the merger. This will support continuity at Lighthouse Imaging and bring an incredibly talented group to the combined organization. Following this merger, we will present to customers an organization with even stronger capabilities than either of us has independently, with the scale of operations to support further investments for growth."

The total purchase price is $2.85 million in cash along with 2.5 million shares of Precision Optics. Potential additional payments up to $1.5 million are subject to certain earnout provisions to be evaluated over the next 2 years. Precision Optics completed an equity capital raise of $1.5 million at a per share price of $1.60 concurrent with the closing of the acquisition and entered into a $2.6 million term loan with Main Street Bank of Marlborough, Massachusetts. The loan is a 7-year term loan with a variable rate of Prime plus 1.5% and minimum rate of 4.75%. The Company also entered into a $250,000 line of credit with Main Street Bank.

Dr. Forkey continued, "We expect this acquisition will be accretive to Precision Optics' profitability per share. Our ability to utilize available bank financing marks a new chapter for our company and we will continue to look to organically and inorganically build capabilities and scale operations to take advantage of robust healthcare and defense markets. Associated with our growth, Precision Optics will resume hosting annual meetings of shareholders in the coming months."

Precision Optics will file an 8-K with the Securities and Exchange Commission with additional details regarding the transaction and intends to amend this 8-K within 71 days to include pro-forma financial statements.

This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Conference Call Details
The Company has scheduled a conference call to discuss the acquisition for today, Tuesday, October 5, 2021 at 4:15pm ET.

Call-in Information: Interested parties can access the conference call by dialing (844) 735-3662 or
(412) 317-5705.

Live Webcast Information: Interested parties can access the conference call via a live Internet webcast, which is available at https://www.webcaster4.com/Webcast/Page/2109/43156.

Replay: A teleconference replay of the call will be available until October 12, 2021 at (877) 344-7529 or (412) 317-0088, confirmation #10160809. A webcast replay will be available at https://www.webcaster4.com/Webcast/Page/2109/43156.

About Precision Optics Corporation
Founded in 1982, Precision Optics is a vertically integrated optics company primarily focused on leveraging its proprietary micro-optics and 3D imaging technologies to the healthcare and defense/aerospace industries by providing services ranging from new product concept through mass manufacture. Utilizing its leading-edge in-house design, prototype, regulatory and fabrication capabilities as well as its Ross Optical division's high volume world-wide sourcing, inspecting and production resources, the Company is able to design and manufacture next-generation product solutions to the most challenging customer requirements. Within healthcare, Precision Optics enables next generation medical device companies around the world to meet the increasing demands of the surgical community who require more enhanced and smaller imaging systems for minimally invasive surgery as well as 3D endoscopy systems to support the rapid proliferation of surgical robotic systems. In addition to these next generation applications, Precision Optics has supplied top tier medical device companies a wide variety of optical products for decades, including complex endocouplers and specialized endoscopes. The Company is also leveraging its technical proficiency in micro-optics to enable leading edge defense/aerospace applications which require the highest quality standards and the optimization of size, weight and power. For more information, please visit www.poci.com.

About Forward-Looking Statements
This press release contains forward-looking statements. Forward-looking statements include, but are not limited to, statements that express the Company's intentions, beliefs, expectations, strategies, predictions or any other statements related to the Company's future activities or future events or conditions. These statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by the Company's 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 the Company's annual report on Form 10-K and in other documents that we file from time to time with the SEC, including but not limited to the risks associated with realizing the opportunities of the Lighthouse acquisition and the resources required to integrate the newly acquired assets. Any forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement, except as required by law.

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SOURCE Precision Optics Corporation

Company Codes: OTC-PINK:PEYE, OTC-QB:PEYE