On the Company entered into an agreement (the “First Agreement”) with 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 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 voluntary petitions for relief under Chapter of Title 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, which amounted to payable to the Company (the “First Exercise”). Of this amount, remained payable to the Company by Chase as of under customary closing procedures and has been classified as other accounts receivable in the accompanying consolidated balance sheets. The First Exercise resulted in the acceleration of the recognition of the remaining unpaid fees owed under the First Agreement. During fiscal year the Company recognized in fees under the First Agreement, which are included in marketing and administrative expenses in the accompanying consolidated statements of income.

 

On the Company entered into an agreement (the “Second Agreement”) with Chase wherein the Company has the right to sell, and Chase has the obligation to purchase, certain accounts receivable claims that could arise if Toys-Delaware converts its Chapter case to Chapter of the U.S. Bankruptcy Code or takes certain other specified actions. The Second 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 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 under the Second Agreement that arose as a result of the liquidation filing, which amounted to million. This amount remained payable to the Company by Chase as of under customary closing procedures and has been classified as other accounts receivable in the accompanying consolidated balance sheets. During fiscal year the Company recognized in fees under the Second Agreement, which are included in marketing and administrative expenses in the accompanying consolidated statements of income.

 

The Company assigns the majority of its trade accounts receivable to CIT pursuant to factoring agreements, which have expiration dates that are coterminous with that of the financing agreement described below. Under the terms of the factoring agreements, CIT remits customer payments to the Company as such payments are received by CIT. Credit losses are borne by CIT with respect to assigned accounts receivable from approved shipments, 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 to the customer after the date of such termination or limitation or discontinues shipments to the customer. Factoring fees, which are included in marketing and administrative expenses in the accompanying consolidated statements of income, were and during fiscal years and respectively. There were advances on the factoring agreements at either or

 

The Company’s credit facility at consisted of a revolving line of credit under a financing agreement with CIT of up to million, which includes a million sub-limit for letters of credit, bearing interest at the rate of prime minus or LIBOR plus The financing agreement matures on and is secured by a lien on all assets of the Company. 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 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 which was as of on daily negative balances, if any, held at CIT.

 

The financing agreement as in effect prior to provided for a monthly fee, which was assessed based on of the average unused portion of the revolving line of credit, less any outstanding letters of credit (the “Commitment Fee”). The Commitment Fee amounted to during fiscal year The financing agreement was amended on to eliminate the Commitment Fee. As of there was a balance of million owed on the revolving line of credit, 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. As of there was balance owed on the revolving line of credit, 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 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 believes it was in compliance with these covenants as of