Capital Leases

During the year ended September 30, 2013, the Company entered into two agreements with a financial institution to finance the purchase of certain assets over a period of two years. The leases require monthly payments of principal and annual imputed interest at 15.6% and 13.0%. Under the terms of the leases, the Company financed the purchase of assets with an aggregate cost of $1,798. During the year ended September 30, 2012, the Company entered into an agreement with a financial institution for the purchase of assets with an aggregate cost of $95. The lease requires monthly payments of principal and annual imputed interest at 10.0%.

Obligations under capital leases are accounted for as current and non-current liabilities and are included within short-term and long-term lease payable on the Company’s consolidated balance sheets. The capital lease payable amounts were based upon the minimum payments required under the leases and the Company’s incremental borrowing rate, adjusted for other interest and deferred financing charges.

The Company had $1,894 and $95, respectively, in assets acquired under capital leases as of September 30, 2013 and 2012, for which the net book values were $1,428 and $87, respectively. Depreciation expense for leased assets is included within depreciation and amortization expense in the Company’s consolidated statements of operations.

As of September 30, 2013, future minimum lease payments related to Company’s capital leases are as follows:



	Amount
	(in thousands)
2014	$	948
2015	665
Total minimum lease payments	1,613
Less amounts representing interest	(185		)
Present value of minimum lease payments	1,428
Less current portion of capital lease obligations	(828		)
Long-term capital lease obligations	$	600