ACCOUNTS RECEIVABLE FINANCING

9 Months Ended

Dec. 28, 2012

Accounts Receivable Financing

ACCOUNTS RECEIVABLE FINANCING

Note 6 -  ACCOUNTS RECEIVABLE FINANCING: 

The Company entered into an accounts receivable financing agreement with a non-bank lending institution (“Factor”) whereby it can borrow up to 80 percent of its eligible receivables (as defined in such financing agreement) at an interest rate of 2.5% above JP Morgan Chase’s publicly announced rate with a minimum rate of 12% per annum. The financing agreement has an initial term of one year and will automatically renew for successive one-year terms, unless terminated by the Company or the Factor upon receiving 60 days prior notice. Funds advanced by the Factor are secured by the Company’s accounts receivable and inventories.

At December 28, 2012, the Company had reported a liability to the Factor of $154,048. As of March 30, 2012, the Company reported a liability to the factor of $54,943.