For bad decisions....money out....not much coming in. I ask you, is Turley or Goerner to blame? If money actually starts flowing into PTSC from whatever the source may be, I have zero confidence that those same people who have made some bad decisions will suddenly develop the skills needed to now make good decisions for all of us. Let the record speak.

From the 10Q 4/2010

Crossflo

On September 1, 2008, we acquired all of the outstanding shares of Crossflo.

The aggregate purchase price was $10,257,604, including $2,850,790 of cash, $824,600 of convertible notes and common stock valued at $6,582,214. The value of the 26,988,455 shares issued was based on the average closing price of our common stock on the Electronic Bulletin Board as reported by NASDAQ over the ten trading days immediately preceding September 1, 2008.

This transaction was accounted for in accordance with FASB guidance for business combinations and we have allocated the total purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values.

……………………..The inability of PDSG to meet its business plan and the general economic environment were indicators of potential impairment on our goodwill and intangible assets, accordingly at May 31, 2009, it was determined that goodwill was impaired by approximately $236,000. We recorded this as an impairment of goodwill on our consolidated statement of income for the fiscal year ended May 31, 2009.

Management’s plan of restructuring on October 5, 2009 and the continuing inability of PDSG to meet its business plan were indicators of potential impairment on our goodwill and intangible assets. Accordingly, at November 30, 2009, it was determined that goodwill was impaired by approximately $1,096,000 and intangibles were impaired by approximately $3,530,000. We recorded these as impairments of goodwill and purchased intangibles on our condensed consolidated statements of operations for the nine months ended February 28, 2010.

Talis Data Systems, LLC

On May 16, 2008, we paid $400,000 to acquire a 15.09% share in Talis, a company that produces multi-domain computer and network security products to government, military, and enterprise customers. Talis develops and markets PCs incorporating the company's Datagent security device, a patented, hardware based data security solution that avoids the vulnerability of software–based approaches.

Talis Data Systems, LLC

On August 1, 2008, we increased our investment in Talis as a result of purchasing additional membership units offered by Talis for $300,00

During the fourth quarter of fiscal year 2009, we purchased an additional 185,793 membership units of Talis for $269,399 which brought our ownership share of Talis to 38.9% at May 31, 2009. During June 2009, we purchased 22,414 membership units for $32,500 which increased our ownership share to 39.4%.

The inability of Talis to meet its business plan, raise capital, and the general economic environment were indicators of impairment on our investment, accordingly at August 31, 2009, it was determined that our investment in Talis was impaired by approximately $680,000.

7. Notes Receivable

Avot Media, Inc.

On February 24, 2009, we received a promissory note receivable from Avot for principal of $100,000. Interest at the rate of 8% accrued on the note until its maturity date of August 24, 2009.

On March 12, 2009, we entered into a secured revolving note receivable with Avot for $500,000. The note bore interest at a rate of 8% and was due December 12, 2009. The note was secured by the assets of Avot. Upon entering into the secured revolving loan note, the short term note we received from Avot on February 24, 2009 was cancelled and the principal amount of $100,000 was classified as an initial advance on the revolving loan note. Under terms of the note, not more than one request for advances shall be made within a single month. On March 13, 2009, April 1, 2009, May 11, 2009 and June 22, 2009, we advanced $115,000, $115,000, $115,000 and $55,000, respectively, to Avot under terms of the note. On December 12, 2009, December 30, 2009 and February 18, 2010 we granted Avot forbearances on the note which extended through March 5, 2010 to accommodate Avot during the solicitation of its business for a capital raise or sale which concluded with a March 2010 sale of substantially all of Avot’s assets and our collection of $503,111 on the note receivable principal and interest (see Note 17). At February 28, 2010 the balance of the note receivable was $503,111, including accrued interest receivable of $3,111.

At May 31, 2009, the balance of the note receivable was $447,810, including accrued interest receivable of $2,810 recognized during the year ended May 31, 2009.

Technology Properties Limited, LLC

On December 24, 2009, we entered into a secured note receivable with TPL for $950,000, intended to cover operating costs including the furtherance of MMP portfolio licensing, which is due and payable on or before July 12, 2010. Terms of the note require interest payable at the rate of 10%. The note is secured by TPL’s portion of its license receivable distribution currently accounted for as license fees receivable on the February 28, 2010 balance sheet of PDS (see Note 11). At February 28, 2010 the balance of the note receivable was $967,438, including accrued interest receivable of $17,438.

On January 12, 2010, we entered into an unsecured note receivable with TPL for $1,000,000, intended to cover operating costs including the furtherance of MMP portfolio licensing, which was due and payable on or before February 28, 2010. Terms of the note required interest payable at the rate of 10%. As of the date of this filing, TPL is in default (see Note 17). At February 28, 2010, the $1,013,151 balance of the note receivable including accrued interest, was fully reserved for.

Index for Clinical Excellence, Ltd.

On January 25, 2010, the assets of Verras were sold for $250,000. At closing we received $62,500 and a non-interest bearing promissory note for $187,500 from Index for Clinical Excellence, Ltd. Terms of the note require payment on each of the three, six and nine month anniversaries of the closing date. Due to the nominal amount of the note and its short term duration interest income was not separately accounted for.

Pursuant to the June 2005 Master Agreement, PDS has committed to pay a quarterly amount ranging between $500,000 and $1,000,000 (based upon a percentage of the working capital fund balance of PDS) for supporting efforts to secure licensing agreements by TPL on behalf of PDS. During the nine months ended February 28, 2010 and 2009, PDS expensed $1,500,000 and $2,369,114, respectively, pursuant to this commitment.

PDS reimburses TPL for payment of all legal and third-party expert fees, other related third-party costs and expenses, and certain internally generated costs as approved on August 17, 2009 and more fully described below. During the nine months ended February 28, 2010 and 2009, PDS expensed $3,590,714 and $2,830,264, respectively, pursuant to the agreement.