DISCONTINUED OPERATIONS

6 Months Ended

Oct. 31, 2011

Notes to Financial Statements

DISCONTINUED OPERATIONS

NOTE 9 - DISCONTINUED OPERATIONS

Effective September 1, 2011, the Company entered into a Securities Purchase Agreement and Amendment No. 1 to the Escrow Agreement (the Agreements) with Multiband, traded under the NASDAQ symbol MBND, for the acquisition by Multiband of the common stock of the Company’s subsidiaries comprising the St. Louis and Sarasota Operations for $2,000,000 in cash.  The $2,000,000 in proceeds was paid to BOA to reduce the outstanding borrowings under the Loan Agreement.

With the sale of these two operations on September 1, 2011, the Company is reporting the St. Louis and Sarasota financial activity as discontinued operations for all periods presented.  A summary of the operating results for the discontinued operations is as follows:

	Three Months Ended						Six Months Ended
	October 31,						October 31,
	2011			2010			2011			2010
REVENUE	$	804,783		$	3,522,642		$	2,660,692		$	9,109,268
COSTS AND EXPENSES:
Cost of revenue		694,763			2,678,816			2,235,794			6,765,809
Selling, general and administrative expenses		201,644			672,377			845,355			1,590,649
Depreciation and amortization		15,357			77,305			67,938			154,571
		911,764			3,428,498			3,149,087			8,511,029
OPERATING (LOSS) INCOME FROM DISCONTINUED OPERATIONS		(106,981	)		94,144			(488,395	)		598,239
Interest expense		-			-			92			43
(Loss) income from discontinued operations before income tax provision (benefit)		(106,981	)		94,144			(488,487	)		598,196
Income tax provision (benefit)		(226,645	)		256,890			(188,819	)		370,882
Income (loss) from discontinued operations, net of tax		119,664			(162,746	)		(299,668	)		227,314
Loss from disposal		(1,027,637	)		-			(1,027,637	)		-
(LOSS) INCOME FROM DISCONTINUED OPERATIONS	$	(907,973	)	$	(162,746	)	$	(1,327,305	)	$	227,314

The Company incurred approximately $299,000 of expenses directly associated with the sale of the St. Louis and Sarasota Operations.

There were no assets or liabilities included in the condensed consolidated balance sheet for the St. Louis and Sarasota Operations at October 31, 2011.  The major classes of assets and liabilities included in the condensed consolidated balance sheets at April 30, 2011 of the discontinued operations were as follows:

	April 30,
ASSETS	2011
CURRENT ASSETS:	$	2,052,945
NON CURRENT ASSETS:		1,246,998
Total assets		3,299,943

LIABILITIES AND EQUITY
CURRENT LIABILITIES:		711,188
NON CURRENT LIABILITIES:		-
Total liabilities		711,188
	$	2,588,755

The Agreements also provide that Multiband will use its best efforts to complete the acquisition of the outstanding common stock of the Company on terms consistent with the non-binding letter of intent dated June 1, 2011, as amended August 11, 2011.  Under the terms of the non-binding letter of intent, Multiband is offering $3.20 in cash per common share for the outstanding common stock of the Company, and the Company has provided Multiband an exclusive period until February 1, 2012 (the Exclusivity Period) in which to complete the transaction.  In exchange for the Exclusivity Period, Multiband has agreed that it will not sell any of the 709,271 shares of Company common stock it currently owns for the duration of the Exclusivity Period.  In addition, Multiband will maintain $250,000 in earnest money down payment in an escrow account in connection with completing the acquisition of the common stock of the Company.  The potential acquisition of the common stock of the Company is subject to customary due diligence, negotiation of a definitive merger agreement and financing commitment from Multiband, and other conditions, including the approval of the Company’s shareholders.