Note 7 – Debt

Debt consists of the following:

	September 30, 2014		June 30, 2014
	(Unaudited)		(Audited)
Term loan 1	$	295,061	$	293,460
Term loan 2		295,096		293,495
Term loan 3		232,392		234,551
Term loan 4		823,139		825,267
Term loan 5		282,128		280,516
Term loan 6		48,831		68,884
Term loan 7		1,161,962		1,256,744
Term loan 8		-		-
Term loan 9		-		-
Trust receipts		2,746,705		3,375,036
Total debt		5,885,314		6,627,953
Less: current portion		(4,169,472)		(4,912,397)
Long-term portion of debt	$	1,715,842	$	1,715,556

Term Loans

All term loans were originally denominated in SGD currency.

Term loan 1 is repayable by 96 months with monthly instalment of $4,207 for the first year. Interest rate for the first year is fixed at 1.88% per annum; second year is fixed at 1.98% per annum and for the third year is fixed at Singapore Lending Rate (SLR) at 3.25% per annum. Thereafter, interest rate is at 0.75% above Singapore Lending Rate (SLR).

Term loan 2 is repayable by 96 months with monthly instalment of $4,207 for the first year. Interest rate for the first year is fixed at 1.88% per annum; second year is fixed at 1.98% per annum and for the third year is fixed at Singapore Lending Rate (SLR) at 3.25% per annum. Thereafter, interest rate is at 0.25% above Singapore Lending Rate (SLR).

Term loan 3 is repayable by 96 months with monthly instalment of $3,362 for the first year. Interest rate for the first year is fixed at 1.88% per annum; second year is fixed at 1.98% per annum and for the third year is fixed at Singapore Lending Rate (SLR) at 3.25% per annum. Thereafter, interest rate is at 0.25% above Singapore Lending Rate (SLR).

Term loan 4 is repayable by 168 months with monthly instalment of $6,222. Interest rate for the first year is fixed at 1.68% per annum; second year is fixed at 1.98% per annum and for the third year is fixed at Singapore Lending Rate (SLR) at 3.25% per annum. Thereafter, interest rate is at 0.2% above Singapore Lending Rate (SLR).

Term loan 5 is repayable by 96 months with monthly instalment of $3,790. Interest rate is fixed at 1.98% per annum for the first year; second year and third year are fixed at Singapore Lending Rate (SLR) at 3.25% per annum. Thereafter, interest rate is at 0.25% above Singapore Lending Rate (SLR).

Term loan 6 is repayable by 24 monthly equal instalments of $10,741. Interest rate per annum is chargeable at 7.50%.

Term loan 7 is repayable by 15 monthly instalments or by such other instalments as may be specified or fixed by the Bank. The interest rate is at 2% per annum above the Bank’s Prime Lending Rate.

Term loan 8 is repayable by 48 monthly instalments of such amount will be notified by the Bank, the company or by such other instalments as may be fixed by Spring and the Bank from time to time. The interest rate is chargeable at 5.00% by such other instalments as may be specified or fixed by the Spring and the Bank from time to time. The loan was settled in full during the financial year.

Term loan 9 is business loan of $152,122 and is repayable by 48 monthly equal instalments of $3,503. Interest rate per annum is chargeable at 5.00%. The loan was settled in full during the financial year.

Trust Receipts

Trust receipts are originally denominated in USD currency.

The Company renewed its trust receipt agreement with Standard Chartered Bank (the “Bank”) in February of 2013.

The interest rate of trust receipts per annum is chargeable at 0.50% above the interest at SBFR (local transactions) and 2.75%) above the interest of SBFR (foreign transactions). The term of the settlement is 90 days from the release of merchandise to the Company from the Bank.

The term loan and trust receipts are collateralized by way of:

Properties of the Company;

Properties of Directors;

Fixed deposits of the Directors; and

Joint and several guarantees by the Directors

Future contractual maturities of debt are as follows, as of September 30, 2014:

Three months ending September 30,
2015	$	4,169,472
2016		207,975
2017		214,086
2018		221,701
2019		229,586
Thereafter		842,494
	$	5,885,314

Interest expense of $46,329 and $52,656 was included in finance costs in the statements of operations for the three months period ended September 30, 2014 and 2013, respectively.

During the three months period ended September 30, 2014, the Company had a net total of $11,107 loss on foreign currency exchange none of which resulted from trust receipts or term loans. During the three months period ended September 30, 2013, the Company had a net total of $59,280 gain on foreign currency exchange none of which resulted from trust receipts or term loans.