Quarterly report pursuant to sections 13 or 15(d)

RELATED PARTY NOTE RECEIVABLE

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RELATED PARTY NOTE RECEIVABLE
9 Months Ended
Sep. 30, 2012
Notes to Financial Statements  
RELATED PARTY NOTE RECEIVABLE

 

The related party note receivable at September 30, 2012 and December 31, 2011 was as follows:

 

 

    September 30,
2012
  December 31, 2011
Related party note receivable   $ 397,970     $ 391,940  
Less: current portion     (18,294 )     (17,491 )
    $ 379,676     $ 374,449  

 

We acquired, with an asset purchase agreement from GGLLC, the note receivable stated above, as part of the purchase of the remaining intellectual property including patents, patent applications, trademarks, trademark applications, copyrights, know-how and trade secrets related to the casino gaming services including but not limited to games, side bets, inventions and ideas. The related party note receivable is a ten year unsecured note with a 6% fixed interest rate, monthly principal and interest payments of $6,598 with the unpaid principal and interest due in February 2017. Interest income associated with this note receivable was $18,985 and $18,696 for the nine months ended September 30, 2012 and 2011, respectively. The terms of the note were amended in September 2010 whereby the monthly principal and interest payment was reduced to $3,332 and the unpaid principal and interest is due August 2015.

 

Management evaluates collectability on a regular basis and will set up reserves for uncollectible amounts when it has determined that some or all of this receivable may be uncollectible. At September 30, 2012 management believed that 100% of the notes receivable principal and interest amounts are collectable.