Electronic Control Security (EKCS)

[flemsnopes]

At June 30, 2012, we had a line of credit with a bank in the amount of $475,000 which we had fully utilized. Due to the net loss in fiscal 2012, we did not meet a covenant of the loan agreement which requires that we have a Minimum Debt Service Coverage Ratio, as defined in the agreement, of 1.1. The bank has provided a waiver of an event of default related to this loan covenant.