On the Company entered into an agreement (the “First Agreement”) with JPMorgan Chase Bank, N.A. (“Chase”) wherein the Company had the right to sell, and Chase had the obligation to purchase, certain claims that could arise if accounts receivable amounts owed by Toys “R” Us-Delaware, Inc. (“Toys-Delaware”), an affiliated company of Toys “R” Us, Inc. (“TRU”), to the Company became uncollectible. The First Agreement would have expired on and carried a fee of per month of the limit of million of accounts receivable due from Toys-Delaware. On TRU and Toys-Delaware filed petitions for relief under Chapter of the U.S. Bankruptcy Code (the “Bankruptcy Filing”). Pursuant to the terms of the First Agreement, the Bankruptcy Filing allowed the Company to exercise its right to sell to Chase the claim that arose as a result of the Bankruptcy Filing (the “First Exercise”), which amounted to and which has been paid in full to the Company by Chase as of The First Exercise resulted in the acceleration of the recognition of the remaining unpaid fees owed under the First Agreement. During the -month period ended the Company recorded in fees under the First Agreement, which are included in marketing and administrative expenses in the accompanying unaudited condensed consolidated statements of income.

 

On the Company entered into an agreement (the “Second Agreement”) with Chase wherein the Company had the right to sell, and Chase had the obligation to purchase, certain accounts receivable claims that could arise if TRU converted its Chapter case to Chapter of the U.S. Bankruptcy Code or had taken other specified actions. The Second Agreement carried a fee of per month of the limit of million of accounts receivable due from Toys-Delaware. During the and -month periods ended the Company recorded and respectively, in fees under the Second Agreement, which are included in marketing and administrative expenses in the accompanying unaudited condensed consolidated statements of income.

 

The Second Agreement was scheduled to have expired on but on TRU filed a motion with the Court seeking authority to close the remaining Toys-Delaware stores and distribution centers in the U.S., and to otherwise discontinue, liquidate and wind-down all U.S. operations of Toys-Delaware. Pursuant to the terms of the Second Agreement, the liquidation filing allowed the Company to exercise its right to sell to Chase the claim that arose as a result of the liquidation filing, which amounted to million and which has been paid in full by Chase as of

The Company assigns the majority of its trade accounts receivable to CIT under factoring agreements whose expiration dates are coterminous with that of the CIT Financing Agreement. Under the terms of the factoring agreements, CIT remits customer payments to the Company as such payments are received by CIT.

 

CIT bears credit losses with respect to assigned accounts receivable from approved customers that are within approved credit limits, while the Company bears the responsibility for adjustments from customers related to returns, allowances, claims and discounts. CIT at any time terminate or limit its approval of shipments to a particular customer. If such a termination or limitation occurs, the Company either assumes (and seek to mitigate) the credit risk for shipments after the date of such termination or limitation or discontinues shipments to such customer. Factoring fees, which are included in marketing and administrative expenses in the accompanying unaudited condensed consolidated statements of income, amounted to and during the -month periods ended and respectively, and and during the -month periods ended and respectively.

The Company’s credit facility at consisted of a revolving line of credit under the CIT Financing Agreement of up to million, which includes a million sub-limit for letters of credit, with an interest rate of prime minus or LIBOR plus and which is secured by a lien on all assets of the Company. The CIT Financing Agreement was scheduled to mature on but on the CIT Financing Agreement was amended to extend the maturity date to As of the Company had elected to pay interest on balances owed under the revolving line of credit under the LIBOR option, which was as of The CIT Financing Agreement also provides for the payment by CIT to the Company of interest at the rate of prime as of the beginning of the calendar month minus on daily cash balances held at CIT.

 

At there was a balance due on the revolving line of credit of million, the entirety of which will mature during fiscal year There was letter of credit outstanding and million was available under the revolving line of credit based on the Company’s eligible accounts receivable and inventory balances. At there was a balance due on the revolving line of credit of million, there was letter of credit outstanding and million was available under the revolving line of credit based on the Company’s eligible accounts receivable and inventory balances. The CIT Financing Agreement contains usual and customary covenants for agreements of that type, including limitations on other indebtedness, liens, transfers of assets, investments and acquisitions, merger or consolidation transactions, transactions with affiliates and changes in or amendments to the organizational documents for the Company and its subsidiaries. The Company was in compliance with these covenants as of