8. BANK LOANS AND NOTES PAYABLE

12 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

BANK LOANS AND NOTES PAYABLE

Bank loans and notes payable consisted of the following at June 30, 2014 and June 30, 2013:

	As of June 30,
		2014		2013
Bank loan payable of principal and interest at a rate equal to prime plus 1.50%, as defined, subject to a floor of 4.75% with principal due at maturity on January 1, 2014; collateralized by accounts receivable and inventory related to a specific customer contract; paid in full during fiscal 2014.	$	-	$	213,750
Note payable to the seller of Tier Electronics LLC of $495,000 payable on January 21, 2014.  Interest accrued at a rate of 8% and was payable monthly.  The promissory note  was collateralized by the Company’s membership interest in its wholly-owned subsidiary  Tier Electronics LLC; paid in full during fiscal 2014.   See note (a) below.		-		495,000
Note payable to Wisconsin Department of Commerce payable in monthly installments of $23,685, including interest at 2%, with the final payment due May 1, 2018; collateralized by equipment purchased with the loan proceeds and substantially all assets of the Company not otherwise collateralized.  The Company is required to maintain and increase a specified number of employees, and the interest rate is increased in certain cases for failure to meet this requirement.   See note (b) below.		1,069,793		1,136,195
Bank loan payable in fixed monthly payments of $6,800 of principal and interest at a rate of 0.25% below prime, as defined, subject to a floor of 5% with any principal due at maturity on June 1, 2018; collateralized by the building and land.		624,760		673,339
Note payable in fixed monthly installments of $6,610 of principal and interest at a rate of 5.5% with any principal due at maturity on May 1, 2028; collateralized by the building and land.		701,716		734,228
Bank loan payable in monthly installments of $21,000 of principal and interest at a rate equal to prime, as defined, subject to a floor of 4.25%; paid in full during fiscal 2014.		-		29,076
	$	2,396,269	$	3,281,588

(a) If the federal capital gains tax rate exceeded 15% and or the State of Wisconsin capital gains tax rate exceeded 5.425% at any time prior to the payment in full of the unpaid principal balance and accrued interest on the promissory note, then the principal amount of the promissory note was to be retroactively increased by an amount equal to the product of (a) the aggregate amount of federal and state capital gain realized by the Seller or Seller’s sole member, as applicable, in connection with the acquisition, multiplied by (b) the difference between (i) the combined federal and State of Wisconsin capital gains tax rate as of the date of calculation, minus (ii) the combined federal and State of Wisconsin capital gains tax rate of 20.425% as of January 21, 2011. Any adjustment to the principal amount of the promissory note was to be effected by increasing the amount of the last payment due under the promissory note without affecting the next regularly scheduled payment(s) under the promissory note. On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed, effectively raising the top rate for capital gains to 20%. The Company recorded an additional $45,000 of principal due under this note as other expense for the year ended June 30, 2013.

(b) As of April 2013, the Wisconsin Department of Commerce granted the Company a 12 month deferral of the required installment payments of $22,800. On March 1, 2014, fifty equal monthly installments of $23,685 commenced through April 1, 2018 with the final installment due on May 1, 2018.

Maximum aggregate annual principal payments for fiscal periods subsequent to June 30, 2014 are as follows:

2015	$	351,142
2016		361,060
2017		371,402
2018		358,384
2019		105,832
2020 and thereafter		848,449
	$	2,396,269