SHAREHOLDERS' EQUITY

12 Months Ended

Jun. 30, 2012

SHAREHOLDERS' EQUITY

NOTE 8 - SHAREHOLDERS’ EQUITY

Common Stock

The following are the details of the Company's common stock as of June 30, 2012 and 2011:

	Number of Shares
	Authorized		Issued		Outstanding		Amount
June 30, 2012
Common stock, $0.10 par value		150,000,000		12,363,486		12,287,290	$	1,226
June 30, 2011
Common stock, $0.10 par value		150,000,000		12,346,986		12,270,790	$	1,224

There were 16,500 shares issued during the year ended June 30, 2012. These shares were issued upon board approval as compensation during the current fiscal year.

There were 46,500 shares issued during the year ended June 30, 2011. These shares were issued upon board approval as compensation during the 2011 fiscal year.

At June 30, 2012, the Company had 2,200,000 warrants outstanding to the Chairman of the Company.

Preferred Stock

The following are the details of the Company's non-voting preferred stock as of June 30, 2012 and 2011:

	Number of Shares
	Authorized		Issued		Outstanding		Amount
June 30, 2012
Preferred stock, Series A $0.10 par value		1,000,000		66,180		-	$	-
Preferred stock, Series B $0.10 par value		1,000,000		79,180		-		-
Preferred stock, Series C $0.10 par value		1,000,000		296,180		296,180	$	27,133
June 30, 2011
Preferred stock, Series A $0.10 par value		1,000,000		66,180		-	$	-
Preferred stock, Series B $0.10 par value		1,000,000		79,180		-		-
Preferred stock, Series C $0.10 par value		1,000,000		296,180		296,180	$	27,133

The shares issued are single class and pay on a monthly basis an annual cash dividend of $5 per share in years ending November 30, 2009 and 2010, $6 per share in the year ending November 30, 2011 and $7 per share thereafter.

On September 25, 2009, the Company reached agreement with the Chairman to amend the dividend rates on the Series C Preferred Stock with an effective date of July 1, 2009. From the effective date forward the Series C Preferred Stock will bear annual dividends of $2 per share in years one and two subsequent to the effective date, $5 per share in year three subsequent to the effective date, $6 per share in year four subsequent to the effective date and $7 per share thereafter. All other terms of the Series C Preferred Shares remained unchanged.

Effective December 31, 2010, the Company revised its estimate regarding the collectability of its $2.5 million term note receivable with a related party. Based on this change in estimate, the Company reclassified the note receivable as a reduction to its outstanding preferred stock as prescribed by a security agreement between the Company and the related party. Under terms of this security agreement and in the event of default of the term note receivable, the Company obtains the right to equal value of the preferred stock as defined including but not limited to title, interest and dividends. The Company has no intention to convert the note receivable in the foreseeable future.

Dividends of $1,357, $568 and $398 were declared for the fiscal periods ended June 30, 2012, 2011 and 2010, respectively.

Treasury Stock

During the fiscal year ended June 30, 2011, the Company purchased 166,181 shares of its common stock at a cost of $3.75 per share as contractually obligated pursuant to put options outstanding from the purchase of ESG in March 2007.

During the fiscal year ended June 30, 2010, the Company purchased 48,263 shares of its common stock at a cost of $3.75 per share as contractually obligated pursuant to put options outstanding from the purchase of ESG in March 2007. There were a total of 217,143 shares eligible to be put to the Company per the terms of the purchase agreement. Substantially, all of the shares were put to the Company on March 1, 2010. The Company negotiated with two of the put holders which held an aggregate of 168,880 of the puts for extended payment terms on the contractual obligation. The remaining contractual obligation of $248 was included in current liabilities at June 30, 2010. This contractual obligation was paid out in monthly payments through December 31, 2010. These shares were held as collateral by the put holders until the final payment was made on December 31, 2010, and therefore have not been included in treasury stock at June 30, 2010.