Factoring Agreement-Related Party

3 Months Ended

May 31, 2012

Related Party Transactions [Abstract]

Factoring Agreement-Related Party

NOTE 13 - FACTORING AGREEMENT-RELATED PARTY

On August 25, 2011, the Company entered into a purchase and sale factoring agreement with a related party whereby the Company sells certain international accounts receivable to the factor. Under the terms of this agreement, the factor makes advances to the Company based on certain international accounts receivable. Interest is computed at 8% of the factored amount for the period the factored accounts receivable remain outstanding. Based on this arrangement, the Company is liable to the factor if the accounts receivable are not collected. Payments are due on the Note as receivables are collected. The agreement was initially due to expire on January 15, 2012, and was extended to December 15, 2012. The shares were valued at $.45 per share and are being amortized over the term of the agreement.