Capital expenditures for fiscal 2013 and 2012 were
HSBC Bank plc. On October 25, 2010, MAM Ltd., entered into a three-year term loan agreement with HSBC Bank plc. ("HSBC") as lender (the "HSBC Term Loan"). The HSBC Term Loan provides for £1,324,550 (approximately $2.0 millionat the exchange rate on October 25, 2010) with a term of three years from the date the HSBC Term Loan is first drawn down. The HSBC Term Loan is repayable in thirty-six (36) monthly installments, inclusive of interest, together with such sums in the final month to discharge the balance of the HSBC Term Loan. The proceeds of the HSBC Term Loan were used to fully repay the residual balance of the credit facility due to ComVest Capital LLC("ComVest") from the Company. The interest rate under the HSBC Term Loan is 2.9% per annum over HSBC's Sterling Base Rate, as published from time to time, which totals 3.4% at June 30, 2013. A prepayment fee of 1.5% of the amount prepaid will be payable by the Company in the event the Term Loan is refinanced by another lender. The HSBC Term Loan is secured by the following instruments: a guarantee granted by the Company, VAST and Autopartin favor of HSBC pursuant to which each would guarantee the repayment of the HSBC Term Loan (the "Guarantee"); an all assets debenture granted by MAM Ltd.in favor of HSBC including a first fixed charge over book debts and stock, which would create fixed and floating the charges over the assets and undertaking of MAM Ltd.for the provision of the HSBC Term Loan ("Debenture"); and a mortgage of the life insurance policies in favor of MAM Ltd.in relation to a Company employee and the Company's CEO. The Company recorded debt issuance fees of approximately $60,000related to the HSBC Term Loan, which is being amortized over the life of the loan. Amortization expense was $11,000year ended June 30, 2013and $25,000year ended June 30, 2012.
The HSBC Term Loan contains various financial covenants. As of
Off Balance Sheet Arrangements
We do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. In addition, we do not have any undisclosed borrowings or debt, and we have not entered into any synthetic leases. We are, therefore, not materially exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships. 23 Current Products and Services
Meeting the needs of the automotive aftermarket requires a combination of business management systems, information products and online services that combine to deliver benefits for all parties involved in the timely repair of a vehicle. Our products and services include:
· Business management systems comprised of our proprietary software applications,
implementation and training and third-party hardware and peripherals;