RELATED PARTY NOTES PAYABLE AND ACCRUED INTEREST

12 Months Ended

Feb. 29, 2012

Notes to Financial Statements

RELATED PARTY NOTES PAYABLE AND ACCRUED INTEREST

NOTE 7:   RELATED PARTY NOTES PAYABLE AND ACCRUED INTEREST

At February 28, 2010, the Company had five outstanding notes payable from the Company’s primary shareholder, the TAM Irrevocable Trust, totaling $471,088. Three of these notes payable totaling $299,275 bore interest at 10% per annum.  The remaining two notes payable totaling $171,193 bore interest during fiscal years 2011 and 2010at 3.25%.  As of February 28, 2010, accrued interest on the related party notes payable amounted to $50,034.  During the year ended February 28, 2011, an additional $9,004 of interest was accrued on these notes. All of these notes and related accrued interest were repaid in full prior to February 28, 2011.  No additional funds were borrowed or outstanding during fiscal year ended February 29, 2012.

The Company paid consulting fees to the Company’s primary shareholder (the TAM  Irrevocable Trust, in which Cari Beck, is the trustee as well as a daughter of Carl Palmer an officer and Board member) totaling $108,000 and $83,500 during the years ended February 29, 2012 and February 28, 2011, respectively, which are included as a component of selling, general and administrative expenses on the consolidated statements of income.