{"url_path":"/sec/cik-0000096885/10-k/2026/item-1","section_key":"item-1","section_title":"Item 1 Business (continued)**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-30","source_url":"https://www.sec.gov/Archives/edgar/data/96885/0001185185-26-002742-index.html","accession_number":"0001185185-26-002742","cik":"0000096885","ticker":null,"issuer_name":"TEL INSTRUMENT ELECTRONICS CORP","edgar_url":"https://www.sec.gov/Archives/edgar/data/96885/0001185185-26-002742-index.html","primary_entity_key":"0000096885","primary_entity_name":"TEL INSTRUMENT ELECTRONICS CORP"},"word_count":564,"has_tables":true,"body_markdown":"**Item\n1. Business (continued)**\n\n \n\n**General\n(continued)**\n\n \n\n**Suppliers**\n\n \n\nTIC obtains its purchased parts from a number of\nsuppliers. In fiscal year 2025, our supply chain has significant issues with our board vendors and battery suppliers which delayed production\nand negatively impacted production. This included a significant delay in battery deliveries for our key CRAFT product line. For the CRAFT\nECP program, Tel has switched suppliers and has seen a significant improvement in product quality and yield. In fiscal year 2024, our\nsupply chain had significant issues with deliveries being delayed which negatively impacted TIC’s revenues and profitability. Notable\nexample was our AN/USM-708 battery component deliveries were delayed approximately 4 months due to our supplier waiting on backlogged\ncomponents preventing final deliveries to customers. As a result, both fiscal year end revenues and gross margins were negatively impacted.\n\n \n\n**Patents\nand Environmental Laws**\n\n \n\nTIC has no patents or licenses which are material\nto its business, and there is no material costs incurred to comply with environmental laws.\n\n \n\n**Engineering,\nResearch, and Development**\n\n \n\nIn\nthe fiscal years ended March 31, 2025, and 2024, Tel incurred expenses of $2,056,977 and $1,155,750, respectively, on the engineering,\nresearch, and development of new and improved products. The increase for the latest fiscal year is due to engineering expenditure funding\nfor the CRAFT ECP program came to a conclusion during July 2024 with no new client funded programs. Tel’s management believes that\ncontinued significant expenditures for engineering, research, and development are necessary to enable Tel to expand its products, sales,\nand profits, and to remain competitive.\n\n \n\n**Personnel**\n\n \n\nAs of March 31, 2025, Tel had 45 employees, comprised\nof 18 full-time and 2 part-time employees in manufacturing, supply chain, and quality assurance, 8 full-time and 1 part-time employees\nin administration and sales, including customer services and product support, and 13 full-time and 3 part-time employees in engineering,\nresearch, and development, none of whom belongs to a union. From time to time, the Company also employs independent contractors to support\nits manufacturing, engineering, and sales organizations. The Company utilized 1 independent contractor in sales management, for the same\nperiod.\n\n \n\nAs of June 29, 2026, Tel had 38 employees,\ncomprised of 17 full-time and 1 part-time employees in manufacturing, supply chain, and quality assurance, 7 full-time and 1\npart-time employees in administration and sales, including customer services and product support, and 10 full-time and 2 part-time\nemployees in engineering, research, and development, none of whom belongs to a union. From time to time, the Company also employs\nindependent contractors to support its manufacturing, engineering, and sales organizations. As of June 2026, the Company utilized 1\nindependent contractor in sales management.\n\n \n\nTel has been successful in attracting skilled and\nexperienced management, sales, and engineering personnel, although the market for senior engineering talent is becoming very competitive.\nWe have not experienced any work stoppages, and we consider our relationship with our employees to be good.\n\n \n\n**Where\nYou Can Find More Information**\n\n \n\nThe\npublic may read and copy any materials the Company files with the U.S. Securities and Exchange Commission (the “SEC”) at\nthe SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of\nthe Public Reference Room by calling the SEC at 1-800-SEC-0030. The SEC maintains an Internet website (sec.gov) that contains reports,\nproxy and information statements and other information regarding issuers that file electronically with the SEC."}