Given the government's increasing concerns about cyber attacks, I was wondering about Holocom too. Apparently PTSC owns 40% of Holocom via ownership of 100% of their Preferred Stock.

http://www.insideview.com/directory/holocom-inc

PTSC's 10-K for year ended 5/31/12 says:

During February 2007, we acquired the preferred stock of Holocom, Inc. formerly known as Scripps Secured Data, Inc. (“Holocom”) a company located in San Diego, California that develops and manufactures network-security hardware to government, military, and other high-security facilities.

Our management has determined that the inability of Holocom to meet its business plan, raise capital, and the general economic environment are indicators of impairment on our investment. Accordingly, at May 31, 2010, we wrote-off our investment in the preferred stock of Holocom, amounting to a $435,182 write-off. We continue to hold 100% of the preferred stock in Holocom.

We own 100% of the preferred stock of Holocom (see Note 5). Prior to impairment, this investment was accounted for at cost since we did not have the ability to exercise significant influence over the operating and financial policies of Holocom.

Investments in Affiliated Companies (continued)

Scripps Secured Data, Inc. (d/b/a Holocom, Inc.)

On February 2, 2007, we invested an aggregate of $370,000 in convertible preferred stock, representing all of the issued preferred stock and a 46% ownership interest, of and in Holocom, a California corporation that manufactures products that protect information transmitted over secure networks. The investment consisted of certain assets we contributed to Holocom valued at $250,000 and cash of $120,000. The investment is represented by 2,100,00 shares of convertible preferred stock, and the shares are convertible at our option into shares of Holocom’s common stock on a one-to-one basis. The convertible preferred stock entitles us to receive non-cumulative dividends at the per annum rate of $0.04 per share, when and if declared by the Board of Directors of Holocom. The investment in Holocom’s convertible preferred stock also entitles us to a liquidation preference of $0.40 per share, plus an amount equal to all declared but unpaid dividends.

We reviewed the Preferred Stock Purchase Agreement and related agreements to determine whether our convertible preferred stock investment in Holocom was in substance an investment in common stock pursuant to authoritative guidance. We also evaluated our voting rights pursuant to other agreements with Holocom and, when considered together with authoritative guidance, we believe that we do not have the ability to exercise significant influence over Holocom. As a result, we were accounting for our investment in Holocom at cost.

Management determined that the inability of Holocom to meet its business plan, raise capital, and the general economic environment were indicators of impairment on our investment. At May 31, 2010, we wrote-off our investment in the preferred stock of Holocom amounting to $435,182.

We review our investments in affiliated companies to determine whether events or changes in circumstances indicate that the carrying amounts may not be recoverable. The primary factors we consider in our determination are the financial condition, operating performance and near term prospects of the investees. If a decline in value is deemed to be other than temporary, we would recognize an impairment loss.

APOLOGIES FOR ANY DUPLICATION OF INFORAMTION IN THE ABOVE.