-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 Wk5SDua3eysJDgTNRWQSHsvs9hJyGmb59RYoz4efWcCA6flBMErEg1jsxSCCFEOA
 /rym0gucfsneTh4y5p4WEA==

<SEC-DOCUMENT>0001144204-10-051244.txt : 20100928
<SEC-HEADER>0001144204-10-051244.hdr.sgml : 20100928
<ACCEPTANCE-DATETIME>20100928160515
ACCESSION NUMBER:		0001144204-10-051244
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20100928
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20100928
DATE AS OF CHANGE:		20100928

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PRO DEX INC
		CENTRAL INDEX KEY:			0000788920
		STANDARD INDUSTRIAL CLASSIFICATION:	SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841]
		IRS NUMBER:				841261240
		STATE OF INCORPORATION:			CO
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-14942
		FILM NUMBER:		101093874

	BUSINESS ADDRESS:	
		STREET 1:		2361 MCGAW AVENUE
		CITY:			IRVINE
		STATE:			CA
		ZIP:			92614
		BUSINESS PHONE:		949-769-3200

	MAIL ADDRESS:	
		STREET 1:		2361 MCGAW AVENUE
		CITY:			IRVINE
		STATE:			CA
		ZIP:			92614
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>v197659_8k.htm
<TEXT>
<html>
  <head>
    <title>Unassociated Document</title>
    <!--Licensed to: Vintage Filings-->
    <!--Document Created using EDGARizer 4.0.6.4-->
    <!--Copyright 1995 - 2008 EDGARfilings, Ltd., an IEC company. All rights reserved-->
    </head>
    <body bgcolor="#ffffff" style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">UNITED
STATES</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SECURITIES
AND EXCHANGE COMMISSION</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Washington,
D.C.&#160;&#160;20549</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">FORM
8-K</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CURRENT
REPORT</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
to Section 13 OR 15(d) of the</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Securities
Exchange Act of 1934</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date of
Report</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Date of
earliest event reported)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">September
28, 2010</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PRO-DEX,
INC.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
name of registrant as specified in its charter)</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
          <div align="left">
            <div align="left">
              <div align="left">
                <div align="left">
                  <div align="left">
                    <div align="left">
                      <div align="left">
                        <div align="left">
                          <table cellpadding="0" cellspacing="0" width="100%">
                              <tr>
                                <td align="left" valign="top" width="33%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font size="2">COLORADO</font></font></div>
                                </td>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font size="2">0-14942</font></font></div>
                                </td>
                                <td align="left" valign="top" width="33%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font size="2">84-1261240</font></font></div>
                                </td>
                              </tr>
                              <tr>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font size="2">(State or
    other</font></div>
                                </td>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font size="2">(Commission File
      Number)</font></div>
                                </td>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font size="2">(I.R.S.
    Employer</font></div>
                                </td>
                              </tr>
                              <tr>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font size="2">jurisdiction
    of</font></div>
                                </td>
                                <td align="left" valign="top" width="33%"><font size="2">&#160;</font></td>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font size="2">Identification
      Number)</font></div>
                                </td>
                              </tr>
                              <tr>
                                <td align="left" valign="top" width="33%">
                                  <div style="TEXT-ALIGN: center"><font size="2">incorporation)</font></div>
                                </td>
                                <td align="left" valign="top" width="33%"><font size="2">&#160;</font></td>
                                <td align="left" valign="top" width="33%"><font size="2">&#160;</font></td>
                              </tr>
                          </table>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">
        <div>&#160;</div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2361
McGaw Avenue, Irvine, California 92614</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
of principal executive offices, zip code)</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(949)
769-3200</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Registrant&#8217;s
telephone number, including area code)</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">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 ( <font style="DISPLAY: inline; FONT-STYLE: italic">see
</font>General Instruction A.2. below):</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;
<font style="DISPLAY: inline;" face="Wingdings">o</font>&#160;&#160;Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;
<font style="DISPLAY: inline;" face="Wingdings">o</font>&#160;&#160;Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;
<font style="DISPLAY: inline;" face="Wingdings">o</font>&#160;&#160;Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;
<font style="DISPLAY: inline;" face="Wingdings">o</font>&#160;&#160;Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center">&#160;</div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 2.02</font><font style="DISPLAY: inline"><font id="TAB2" style="LETTER-SPACING: 9pt"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font></font></font><font style="DISPLAY: inline"><font id="TAB2" style="LETTER-SPACING: 9pt"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font></font></font><font style="DISPLAY: inline; TEXT-DECORATION: underline">Results of Operations and
Financial Condition.</font></font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 45.8pt"></font>The information in this Form 8-K and
the Exhibits attached hereto shall not be deemed "filed" for purposes of Section
18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor
shall it be deemed incorporated by reference in any filing under the Securities
Act of 1933, as amended, or the Exchange Act, except as shall be expressly set
forth by specific reference in such a filing.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
September 28, 2010 Pro-Dex, Inc. issued a press release announcing its financial
performance for the fourth quarter and full-year of fiscal year
2010.&#160;&#160;On that same date, Pro-Dex, Inc. conducted a conference call
concerning its performance for the fourth quarter and full year of fiscal year
2010.&#160;&#160;A copy of the news release is attached to this Form&#160;8-K as
Exhibit&#160;99.1.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Item 9.01</font><font style="DISPLAY: inline"><font id="TAB2" style="LETTER-SPACING: 9pt"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font></font></font><font style="DISPLAY: inline"><font id="TAB2" style="LETTER-SPACING: 9pt"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font></font></font><font style="DISPLAY: inline; TEXT-DECORATION: underline">Financial Statements and
Exhibits</font></font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Exhibits.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Exhibit 99.1&#160;&#160;&#160;Press
release dated September 28, 2010 of Pro-Dex Inc.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
      </div>
      <div>&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SIGNATURES</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>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.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br>&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">
      <div>
        <div align="left">
          <table border="0" cellpadding="0" cellspacing="0" width="100%">
              <tr>
                <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Date:&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt">September 28,
      2010</font>&#160;&#160;&#160;</font></td>
                <td colspan="2" valign="top" width="38%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">PRO-DEX,
      Inc (Registrant).</font></font></td>
                <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
              <tr>
                <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td colspan="2" valign="top" width="38%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
              <tr>
                <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="50%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></div>
                </td>
                <td valign="top" width="3%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By:
      </font></div>
                </td>
                <td align="left" nowrap valign="top" width="35%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">/s/&#160;Mark
      P. Murphy</font></td>
                <td valign="top" width="12%" style="BORDER-BOTTOM: #ffffff solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
              <tr>
                <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td align="left" nowrap valign="bottom" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Mark
      P. Murphy</font></td>
                <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
              <tr>
                <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief
      Executive Officer</font></td>
                <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
              <tr>
                <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              </tr>
          </table>
        </div>
      </div><br></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INDEX
TO EXHIBITS</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
          <div align="left">
            <div align="left">
              <div align="left">
                <div align="left">
                  <div align="left">
                    <div align="left">
                      <div align="left">
                        <div align="left">
                          <div align="left">
                            <table cellpadding="0" cellspacing="0" width="100%">
                                <tr>
                                  <td align="left" valign="top" width="9%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">      </font>
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exhibit</font></div>
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Number</font></font></font></div>
                                  </td>
                                  <td align="left" valign="top" width="4%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="top" width="87%" style="BORDER-BOTTOM: black 2px solid">
                                    <div>&#160;</div>
                                    <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Description</font>&#160;&#160;</font></div>
                                  </td>
                                </tr>
                                <tr>
                                  <td align="left" valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="top" width="87%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr>
                                  <td align="left" valign="top" width="9%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left">
                                      <div style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">99.1</font></div>
                                    </div>
                                  </td>
                                  <td align="left" valign="top" width="4%">
                                    <div style="TEXT-ALIGN: center">
                                      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
                                    </div>
                                  </td>
                                  <td align="left" valign="top" width="87%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left">
                                      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Press
      Release dated September 28, 2010<a name="prodex10q_htm_notes_to_consolidated_fina" /><a name="prodex10q_htm_item_2__management_s_discu" /></font></div>
                                    </div>
                                  </td>
                                </tr>
                            </table>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">
        <div>&#160;</div>
      </div>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
      </div>
      <div id="PN">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
      </div>
    </div>
  </body>
</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>2
<FILENAME>v197659_ex99.htm
<TEXT>

<html>

<head>

<META content="text/html; charset=utf-8">

</META>

</head>

<body style="font-size:10pt;font-family:Arial;color:black;">

<div style="width:100%;margin-left:10pt">

<p style="text-align:center">

<b>
Pro-Dex, Inc. Announces Fiscal Year 2010 Fourth Quarter and Full-Year Results
</b>

</p>

</div>

<div style="width:100%;margin-left:10pt;">

<div style="margin:0;margin-top:16pt;">

<p>
IRVINE, Calif., Sept. 28 /PRNewswire-FirstCall/ -- PRO-DEX, INC. (Nasdaq: PDEX) today announced financial results for the fiscal fourth quarter and full-year ending June 30, 2010.
</p>

<p>
Sales for the full fiscal year ended June 30, 2010 increased 10% to $23.2 million compared to $21.1 million in fiscal year 2009, driven by medical products sales to our largest two customers that were up by 30% compared to the previous year. &#160;Sales for the fourth quarter ended June 30, 2010 increased 2% to $5.7 million compared to $5.6 million reported for the fourth quarter of fiscal 2009. &#160;Operating income before recognition of impairments to goodwill and property value reductions was $1.2 million for the full year of fiscal 2010 compared to a loss of $495 thousand for fiscal year ended June 30, 2009. Operating Income before the recognition of impairments to goodwill and real property increased 24% to $296 thousand for the fourth quarter compared to $239 thousand in the same period of the prior year. &#160;Impairments and real property value reductions amounted to $4.3 million in the fourth quarter of fiscal 2010, $4.4 million for the full 2010 fiscal year, $0 in the fourth quarter of fiscal 2009
 and $997 thousand for the full fiscal year of 2009.
</p>

<p>
The net loss for the full fiscal year 2010 was $2,968,000 or $0.92 per share compared to net loss for the full fiscal year 2009 of $2,845,000 or $0.88 per share. The net loss for the fourth quarter of fiscal year 2010 was $3,905,000 or $1.20 per share (based on 3.2 million shares) compared to net income of $202,000 or $0.06 per share for the three months ended June 30, 2009 (based on 3.2 million shares).
</p>

<p>
Gross profit for the full 2010 fiscal year was $8.4 million, a 36% gross profit margin, compared to gross profit of $6.7 million or 32% gross profit margin, for the year-ago period. &#160;For the full year, margins benefited from higher volumes of our more profitable medical and motion control products. &#160;Gross profit for the quarter ended June 30, 2010 increased to $2.2 million, a 38% gross profit margin, compared to gross profit of $1.9 million or 35% gross profit margin in last year&#39;s fourth quarter, as a result of higher sales levels in the motion control business. &#160;
</p>

<p>
There were $4.4 million of non-cash impairment and real property value reduction charges in fiscal year 2010. &#160;Impairments recognized consisted of $140,000 from the remaining IntraFlow patent (in the second quarter), $1.9 million from the Astromec business goodwill, and $1.1 million from Micro Motors goodwill (both in the fourth quarter). In addition, in the fourth quarter of fiscal 2010 we recognized a $1.3 million reduction in the value of the real property used at our Astromec operation in Carson City, Nevada.&#160; &#160;In the third quarter of fiscal year 2009 we recognized $997 thousand of impairment charges associated with the IntraFlow patent. &#160;Following the recognition of these items, our balance sheet has no remaining intangible assets.
</p>

<p>
Mark Murphy, the Company&#39;s President and Chief Executive Officer, commented, &#34;Fiscal 2010 was an encouraging year for Pro-Dex, as we grew the top line and returned to profitable operations on a pre-impairment basis. &#160;I recognize the disappointment of another year of significant write-offs, and know that it detracts from&#160;our strong operating performance during fiscal year 2010. &#160;However, focusing on our fundamental operating results excluding these charges, our sales increased by 10% over last year, our gross margins improved by 4 percentage points from 32% to 36%, and our operating expenses remained stable at last year&#39;s reduced levels, all resulting in an operating profit of $1.2 million.&#160; In fiscal year 2010, we generated $3.2 million in operating cash, the highest level achieved in the last 10 years, after generating $1.7 million in fiscal year 2009 and $2.0 million in fiscal year 2008. &#160;As a fundamental operating business, Pro-Dex has again produced solid results.&#34
;
</p>

<p>
During both the fourth quarter and the entire fiscal year 2010, we continued to strengthen the balance sheet. In Q4, we generated an additional $570,000 of cash from operations and, for all of fiscal year 2010, we generated $3.2 million in cash from operations. &#160;The full-year cash generation includes $549,000 in cash received in the third quarter for collection of a claim for federal income taxes due to enhanced net operating loss carryback rules implemented by the IRS in 2009. &#160;At June 30, 2010, we had cash and cash equivalents of $3,794,000 compared to cash and cash equivalents of $1,124,000 as of June 30, 2009. &#160;The Company had
<u>
net cash
</u>
 of $899,000 compared to
<u>
net debt
</u>
 of $2.2 million at June 30, 2009, a $3.1 million total improvement.
</p>

<p>

<u>

<b>
Teleconference Information:
</b>

</u>

</p>

<p>
Investors and all others are invited to listen to a conference call discussing the fourth fiscal quarter and year end 2010 results, today at 4:30 p.m. Eastern Time. The call is scheduled to be broadcast live over the Internet and may be accessed by visiting the Company&#39;s website at http://www.pro-dex.com or directly at http://www.videonewswire.com/event.asp?id=72574. Mark Murphy, Chief Executive Officer and Jeff Ritchey, Chief Financial Officer, plan to host the call. If you would like to join the call, dial (877) 356-8625 U.S. and (706) 634-9779 International, conference I.D. 13203491. You may identify the call as the Pro-Dex Fourth Quarter Earnings Call. An online archive of the broadcast will be available within two hours of the completion of the call and will be accessible on the Company&#39;s website for 365 days. Additionally, a telephone replay will be available 2 hours after the call for 48 hours by dialing (800) 642-1687 U.S. or (706) 645-9291 for international callers, conference I.D. number 13
203491.
</p>

<p>
Pro-Dex, Inc., with operations in California, Oregon and Nevada, specializes in bringing speed to market in the development and manufacture of technology-based solutions that incorporate miniature rotary drive systems, embedded motion control and fractional horsepower DC motors, serving the medical, dental, semi-conductor, scientific research and aerospace markets. &#160;Pro-Dex&#39;s products are found in hospitals, dental offices, medical engineering labs, commercial and military aircraft, scientific research facilities and high tech manufacturing operations around the world. &#160;For more information, visit the Company&#39;s website at www.pro-dex.com.
</p>

<p>
Statements herein concerning the Company&#39;s plans, growth and strategies may include &#39;forward-looking statements&#39; within the context of the federal securities laws. Statements regarding the Company&#39;s future events, developments and future performance, as well as management&#39;s expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. The Company&#39;s actual results may differ materially from those suggested as a result of various factors. Interested parties should refer to the disclosure concerning the operational and business concerns of the Company set forth in the Company&#39;s filings with the Securities and Exchange Commission.
</p>

<div style="margin-bottom:.0001in; margin-top:.0001in">

<table cellspacing="0" cellpadding="3" style="border-collapse:collapse;border:none;">

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<font style="font-family:Arial;font-size:8pt;">
(tables follow)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
PRO-DEX, INC. and SUBSIDIARIES
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
CONSOLIDATED BALANCE SHEETS
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
30-Jun-10
</font>

</i>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
30-Jun-09
</font>

</i>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<b>

<font style="font-family:Arial;font-size:8pt;">
ASSETS
</font>

</b>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Current assets:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Cash and cash equivalents
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; 3,794,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; 1,124,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Accounts receivable, net of allowance for doubtful accounts of $25,000 in 2010 and $52,000 in 2009
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,682,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,515,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Other Current Receivables
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
22,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
16,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Inventories
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,228,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,365,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Prepaid expenses
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
174,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
117,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Prepaid income taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
118,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Deferred income taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
209,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; Total current assets
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
10,109,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
7,255,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Property, plant, equipment and leasehold improvements, net
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
4,092,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
5,981,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Other assets:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Goodwill
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,997,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Intangibles - Patents, net
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
147,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160;&#160; Other
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
78,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
87,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; Total other assets
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
78,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,231,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Total assets
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:double black 2.5pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 14,279,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:double black 2.5pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 16,467,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<b>

<font style="font-family:Arial;font-size:8pt;">
LIABILITIES AND SHAREHOLDERS&#39; EQUITY
</font>

</b>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Current liabilities:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Accounts payable
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; 1,279,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; &#160;827,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Accrued expenses
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,947,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,394,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Income taxes payable
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
79,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
53,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Current Portion of T.I. Loan
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
400,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
400,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Current portion of real estate loan
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
35,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
33,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160;Total current liabilities
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,740,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,707,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Long-term liabilities:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160;Notes Payable - T.I. Loan
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
967,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,367,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160;Real estate loan
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,493,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,528,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160;Deferred income taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
209,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
171,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160;Deferred rent
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
255,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
212,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160;Total long-term liabilities
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,924,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,278,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Total liabilities
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
6,664,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
5,985,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Commitments and contingencies
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Shareholders&#39; equity:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Common shares; no par value; 50,000,000 shares authorized;
</font>

<font style="font-family:Arial;font-size:8pt;">
3,251,850 shares issued and outstanding June 30, 2010
</font>

<font style="font-family:Arial;font-size:8pt;">

</font>

<font style="font-family:Arial;font-size:8pt;">
3,222,890 shares issued and outstanding June 30, 2009
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
16,675,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
16,574,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Accumulated deficit
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(9,060,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(6,092,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160;Total shareholders&#8217; equity
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
7,615,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
10,482,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Total liabilities and shareholders&#8217; equity
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 14,279,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 16,467,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
See notes to consolidated financial statements.
</font>

</i>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

</tr>

</table>

<br />

<br />

</div>

<div style="margin-bottom:.0001in; margin-top:.0001in">

<table cellspacing="0" cellpadding="3" style="border-collapse:collapse;border:none;">

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
PRO-DEX, INC. and SUBSIDIARIES
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
CONSOLIDATED STATEMENTS OF OPERATIONS
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
Years ended June 30
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" colspan="2" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
2010
</font>

</i>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
2009
</font>

</i>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net sales
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;23,211,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;21,122,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cost of sales
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
14,847,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
14,374,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Gross profit
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
8,364,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
6,748,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Operating expenses:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Selling expense
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,382,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,295,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; General and administrative expenses
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,288,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,157,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Impairment of intangible assets
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,137,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
997,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Impairment of property value
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,307,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Research and development costs
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,480,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,791,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Total operating expenses
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
11,594,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
8,240,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
(Loss) from operations
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(3,230,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(1,492,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Other:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Royalty income
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
44,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
14,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Interest income
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Interest (expense)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(204,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(228,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Total
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(158,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(212,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
(Loss) Income before provision for income taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(3,388,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(1,704,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Benefit for Income Taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,130,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,100,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Allowance for deferred tax asset
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(710,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(2,241,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Total Benefit (Provision) for Income taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
420,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(1,141,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net (Loss)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;(2,968,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;(2,845,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net (Loss) per share:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Basic
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; &#160; &#160; &#160; (0.92)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; &#160; &#160; &#160; (0.88)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Diluted
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; &#160; &#160; &#160; (0.92)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; &#160; &#160; &#160; (0.88)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Weighted average shares outstanding - basic
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,232,850
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,236,918
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Weighted average shares outstanding - diluted
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,232,850
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,236,918
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; ">

<p style="text-align: center; ">

<font style="font-family:Arial;font-size:8pt;">
See notes to consolidated financial
</font>

<font style="font-family:Arial;font-size:8pt;">
 statements.
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

</tr>

</table>

<br />

<br />

</div>

<div style="margin-bottom:.0001in; margin-top:.0001in">

<table cellspacing="0" cellpadding="3" style="border-collapse:collapse;border:none;">

<tr>

<td valign="bottom" colspan="6" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
PRO-DEX, INC. and SUBSIDIARIES
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="6" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
RECONCILIATION of NON-GAAP RESULTS to GAAP RESULTS
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="6" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; ">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
$ in thousands, except EPS
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<font style="font-family:Arial;font-size:8pt;">
FY2010
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<font style="font-family:Arial;font-size:8pt;">
FY2009
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<font style="font-family:Arial;font-size:8pt;">
Q4 2010
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<font style="font-family:Arial;font-size:8pt;">
Q4 2009
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Operating Income/(Loss) before impairments and property value reductions
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;1,214
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; (495)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; 296
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;239
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Impairments
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,137
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
997
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,997
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Property Value reduction
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,307
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,307
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Income (Loss) from Operations
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; (3,230)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; (1,492)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; (4,008)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;239
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net interest and Other Income (Loss)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(158)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(212)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(49)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(45)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Income before provision for taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(3,388)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(1,704)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(4,057)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
194
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Benefit/(Provision) for taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
420
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(1,141)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
152
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
8
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net (Loss)/Income
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; (2,968)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; (2,845)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; (3,905)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;202
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
EPS (Basic &amp; diluted)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;(0.92)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;(0.88)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160;(1.20)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 0.06
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

</tr>

</table>

<br />

<br />

</div>

<div style="margin-bottom:.0001in; margin-top:.0001in">

<table cellspacing="0" cellpadding="3" style="border-collapse:collapse;border:none;">

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
PRO-DEX, INC. and SUBSIDIARIES
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
CONSOLIDATED STATEMENTS OF CASH FLOWS
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<p style="text-align: center; ">

<b>

<font style="font-family:Arial;font-size:8pt;">
Years ended June 30
</font>

</b>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-left:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
2010
</font>

</i>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
2009
</font>

</i>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash Flows from Operating Activities:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net Income
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160;(2,968,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160;(2,845,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Adjustments to reconcile net income to net cash used in operating activities:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160;Depreciation and amortization
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
726,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
810,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160;Impairment of intangible asset and property value
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
4,444,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
997,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160;Loss on Disposal
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
25,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160;(Recovery of) Provision for doubtful accounts
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(27,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(92,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160;Stock based compensation
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
101,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
166,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160;Deferred taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(91,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,058,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160;Changes in:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; (Increase) Decrease in accounts receivable
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(146,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
609,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160;Decrease in inventories
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
137,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,737,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160;(Increase) Decrease in prepaid expenses
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(57,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
97,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160;Decrease (Increase) in other assets
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
9,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(20,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160;Increase (Decrease) in accounts payable and accrued expenses
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,086,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(1,505,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160;Increase in income taxes payable
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
26,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
681,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net Cash provided by Operating Activities
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
3,240,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,718,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash Flows From Investing Activities:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Purchase of equipment and leasehold improvements
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(137,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(269,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net Cash used in Investing Activities
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(137,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(269,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash Flows from Financing Activities:
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160; &#160;Principal payments of patent deferred payable
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(45,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160; &#160;Net (payments) on Line of Credit
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(2,000,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160; &#160;Principal (payments) on Term Note
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(400,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(396,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 Net Principal borrowing on TI Loan
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,767,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
&#160;&#160;&#160; &#160;Principal payments on Real Estate Loan
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(33,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(31,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
 &#160; &#160; Stock Repurchases
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
- -
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-left:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(137,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net Cash (used in) Financing Activities
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(433,000)
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 6pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
(842,000)
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Net increase &#160;in Cash and Cash Equivalents
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
2,670,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
607,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash and Cash Equivalents, beginning of year
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
1,124,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
517,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-left:solid black 1pt; border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-right:solid black 1pt; ">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash and Cash Equivalents, end of year
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 3,794,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; 1,124,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" colspan="3" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; ">

<p style="text-align: center; ">

<i>

<font style="font-family:Arial;font-size:8pt;">
Supplemental Information
</font>

</i>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-top:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash paid for interest
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160;204,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-top:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160;230,000
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-left:solid black 1pt; border-right:solid black 1pt; ">

<p>

<font style="font-family:Arial;font-size:8pt;">
Cash paid for income taxes
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;white-space: nowrap; border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160;154,000
</font>

</p>

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;border-bottom:solid black 1pt; border-right:solid black 1pt; padding-right: 9pt; ">

<p style="text-align: right; ">

<font style="font-family:Arial;font-size:8pt;">
$ &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160; &#160;-
</font>

</p>

</td>

<td style="">

</td>

</tr>

<tr>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td valign="bottom" style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

<br />

</td>

<td style="">

</td>

</tr>

<tr>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

<td style="padding: 0pt 5.4pt 5.4pt 5.4pt;">

</td>

</tr>

</table>

<br />

<br />

</div>

<br />

<br />

<p>
CONTACT: &#160;Mark Murphy, Chief Executive Officer of Pro-Dex, Inc., +1-949-769-3200
</p>

</div>

</div>

</body>

</html>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
