Quarterly report pursuant to Section 13 or 15(d)

DUE FROM FACTOR

v3.21.2
DUE FROM FACTOR
9 Months Ended
Sep. 30, 2021
DUE FROM FACTOR  
DUE FROM FACTOR

NOTE 5: DUE FROM FACTOR

The Company, via its subsidiaries, Bailey and Stateside, assigns a portion of its trade accounts receivable to a third- party factoring company, who assumes the credit risk with respect to the collection of non-recourse accounts receivable. The Company may request advances on the net sales factored at any time before their maturity date, and up to 50% of eligible finished goods inventories. The factor charges a commission on the net sales factored for credit and collection services. Interest on advances is charged as of the last day of each month at a rate equal to the LIBOR rate plus 2.5% for Bailey. For Stateside, should total commission and fees payable be less than $30,000 in a single year, then the factor shall charge the difference between the actual fees in said year and $30,000 to the Company. Interest on advances is charged as of the last day of each month at a rate equal to the greater of either, (a) the Chase Prime Rate + (2.0)% or (b) (4.0)% per annum. Advances are collateralized by a security interest in substantially all of the companies’ assets.

Due to/from factor consist of the following:

    

September 30, 

    

December 31, 

2021

2020

Outstanding receivables:

 

  

 

  

Without recourse

$

1,022,552

$

151,158

With recourse

 

58,884

 

42,945

Advances

 

119,937

 

56,246

Credits due customers

 

(107,064)

 

(40,316)

$

1,094,309

$

210,033