Related Party Transactions

6 Months Ended

Dec. 31, 2021

Note 6 - Related Party Transactions

Notes Payable

	December 31, 2021		June 30, 2021
Note payable to a stockholder in which the $200,000 principal plus $10,000 of interest was payable in December 2019. Borrowings under the note increased to $400,000 and the maturity was extended to November 13, 2021. The note bears interest at 6% per annum and is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 400,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. Extinguished by exchange for Series F Preferred Stock on December 28, 2021.	$	-	$	400,000

Fair value of unsecured notes payable to seller of Concepts and Solutions, a related party, bearing interest at 3% per year, payable in annual installments through November 30, 2021. Payment is subject to adjustment based on the achievement of minimum gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions.		1,030,079		1,030,079

Note payable to a stockholder in which the note principal plus 6% interest was payable on November 7, 2021. Note was amended in March 2020 by increasing the balance to $1,225,000. Interest is payable in cash or common stock, at the holder's option. If interest is paid in common stock, the conversion price was to be the market price at the time of conversion. Principal on the note at maturity is convertible into 1,225,000 shares of Series D Preferred Stock. If principal was paid prior to maturity, the right of conversion is terminated. Extinguished by exchange for Series F Preferred Stock on December 27, 2021.		-		1,225,000

Note payable to a stockholder in which the note principal plus 6% interest is payable in November 13, 2021. Interest was payable in cash or common stock, at the Company's option. If interest was paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 200,000 shares of Series D Preferred Stock. If principal was paid prior to maturity, the right of conversion is terminated. Extinguished by exchange for Series F Preferred Stock on December 20, 2021.		-		200,000

-18-

Note payable to a stockholder in which the note principal plus interest at 15% is payable the earlier of 60 days after invoicing a certain customer, or April 2022 due to an extension granted by the lender. On December 23, 2021, an amendment extended the maturity to March 30, 2025, changed the interest rate to 10% with monthly payments of principal and interest of $8,823. The note is collateralized by a security interest in a certain customer purchase order.		385,000		385,000

Note payable related to the acquisition of Classroom Tech in which the note principal is payable in 2021 with no interest obligations, upon the shareholder’s resolution of a pre-acquisition liability with a bank.		125,690		155,690

Other short-term payables due to stockholders and related parties		43,488		75,986
Total Related Party Notes Payable and Other Payables		1,584,257		3,471,755
Current Portion of Related Party Notes Payable and Other Payables		1,296,310		3,471,755

Long-term Portion of Related Party Notes Payable and Other Payables	$	287,947	$	-

As of December 31, 2021, related party notes payable maturities are as follows:

Period ending December 31,
	2022	$	1,296,310
	2023		105,876
	2024		105,876
	2025		76,195
		$	1,584,257

In December of 2021, $1,825,000 of related party convertible notes and 500,000 shares of Series E preferred stock were eliminated upon the execution of an agreement to exchange them for Series F preferred shares. In addition, the agreement of the exchange of the notes resulted in the elimination of the derivative liability related to the conversion features of the notes into Series D Preferred stock. The derivative liability was reduced by $1,842,000 resulting in additional paid in capital of approximately $1,825,000. On December 31, 2021, the recorded derivative liability is $0.

Related Party Leases

The Company leases property used in operations from a related party under terms of a financing lease. The term of the lease expires on December 31, 2021. The monthly lease payment is $9,664 plus maintenance and property taxes, as defined in the lease agreement. Rent expense for this lease was $28,992 and $4,500 for the three months ended December 31, 2021 and 2020, respectively and $57,984 and $9,000 for the six months ended December 31, 2021 and 2020 respectively.

Other Related Party Agreements

A related party collateralizes the Company's short-term note with a certificate of deposit in the amount of $274,900, held at the same bank. The related party will receive a $7,500 collateral fee for this service (see Note 4).