6 - NOTES PAYABLE

6 Months Ended

Jun. 30, 2011

6 – NOTES PAYABLE

	June 30,		December 31,
	2011		2010
	(Unaudited)

Secured credit facility - related party		1,500,000		1,500,000
Less current portion		-		(1,500,000	)
Long-term debt, less current portion	$	1,500,000	$	-

Secured credit facility - On April 21, 2008 we entered into a $3,000,000 credit facility, collateralized by real property, from K.S. Best International Co. Ltd., a company controlled by the brother of our Chief Executive Officer. On March 7, 2011 we renewed and extended maturities to June 30, 2013. Credit is available in $500,000 advances, each advance payable in monthly interest only installments, at the rate of Prime + 0.25% per annum with entire principal amount outstanding due two years from the date of each advance or April 21, 2011, whichever is earlier. As of June 30, 2011 and December 31, 2010, the aggregate outstanding balance on this credit facility was $1,500,000. The advance history of the credit line is such that on June 3, 2008, we borrowed $500,000, on April 3, 2009, we borrowed $500,000 and on April 1, 2010, we borrowed $500,000. All advances are due June 30, 2013.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References+ Details