EQUIPMENT LOAN AND LEASES

12 Months Ended

Dec. 31, 2012

Leases [Abstract]

EQUIPMENT LOAN AND LEASES

5.           EQUIPMENT LOAN AND LEASES

Equipment Loan.  Innotrac entered into a five year $1.8 million dollar equipment loan in June 2012.  The equipment loan as described in Note 4 Financing Obligations to these consolidated financial statements is within the $15.0 million borrowing limit of the Credit Facility and is collaterized by specifically identified fulfillment equipment as valued by an independent appraiser.  The Equipment Loan has a five year repayment term and will be paid back in 60 equal $30,000 monthly payments with an equal offsetting monthly reduction in the value of the selected fulfillment equipment included as collateral under the Credit Facility. This loan is subject to renewal with the Credit Facility at June 30, 2013 and as a result is classified as a current liability in the accompanying consolidated balance sheets.  Future payments under the Equipment loan as of December 31, 2012 are as follows:

	Equipment Loan
2013	$	360
2014		360
2015		360
2016		360
2017		180
Total payments due after December 31, 2012	$	1,620

Equipment Leases.  Innotrac has entered into various capital leases for warehouse and computer equipment.  The amortization of these assets is included in depreciation and amortization expense.  Aggregate future minimum lease payments under these noncancellable capital leases as of December 31, 2012 are as follows (in 000’s):

	Capital Leases
2013	$	493
2014		436
2015		144
		1,073
Less amounts representing interest and taxes		(108	)
Present value of future minimum lease payments		965
Less current portion		(421	)
Capital lease obligations, net of current portion	$	544

Operating Leases.  Innotrac leases office and warehouse space and equipment under various operating leases. The primary office and warehouse operating leases provide for escalating payments over the lease term. Innotrac recognizes rent expense on a straight-line basis over the lease term.

Aggregate future minimum lease payments under noncancellable operating leases with original periods in excess of one year as of December 31, 2012 are as follows (in 000’s):

	Operating Leases
2013	$	10,010
2014		8,103
2015		5,206
2016		3.623
2017		1,259
Thereafter		1,661
Total minimum lease payments	$	29,862

Rent expense under all operating leases totaled approximately $9.5 million during both years ended December 31, 2012 and 2011.