Loan Payable, Bank:

9 Months Ended

Mar. 31, 2012

Notes to Financial Statements

Loan Payable, Bank

9. Loan Payable, Bank

The Company has a line of credit with its bank, JPMorgan Chase Bank, N.A.(the “Bank”), providing for maximum borrowings of up to $700,000, bearing interest at 3.08 percentage points above a defined LIBOR Index, (3.33% at March 31, 2012) and secured by a pledge of collateral consisting of the inventory, accounts, chattel paper, equipment and general intangibles of the Company. Outstanding amounts are due and payable by June 13, 2013 with a requirement that the Company is to reduce the outstanding principal balance to zero during the 30 day period ending on the anniversary date of the related note evidencing the borrowing. No amounts were outstanding at March 31, 2012 and June 30, 2011.