Annual report pursuant to section 13 and 15(d)


12 Months Ended
Dec. 31, 2011
Notes to Financial Statements  


Long - term debt consists of the following at December 31, 2011 and 2010:


  2011   2010
Note payable - commercial bank $ 1,148,448     $ 1,172,393  
Notes payable, net of debt discount - asset acquisition   20,722,158       57,113  
    21,870,606       1,229,506  
Less: Current portion   (1,835,240 )     (81,058 )
Total long – term debt $ 20,035,366     $ 1,148,448  


The note payable is paid to a commercial bank in monthly installments of $9,159 including fixed interest of 7.3%, for ten years, through February 2017, at which time there is a balloon payment of $1,003,230. This liability was assumed with the asset purchase agreement from the GGLLC. The note payable financed the purchase of the 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 note agreement with the commercial bank remains in the name of GGLLC and we have no direct obligation to the commercial bank.


In connection with the asset purchase agreement associated with the T&P Gaming acquisition executed on April 15, 2010, we obtained seller financing in the amount of $126,000 payable over eighteen months at an interest rate of 6% per annum. Monthly principal and interest payments of $7,301 were required with the first payment paid upon closing. The promissory note was fully paid-off in the year ended December 31, 2011.


In October, 2011 we closed an asset acquisition of Prime Table Games (US and UK components). Included within the structure of the $23 million acquisition was a $22.2 million component consisting of two promissory notes: 1) a US note for $12.2 million, and 2) a £6.4 million ($10.0 million USD) note. The notes were recorded at fair value, net of a debt discount of $1,530,000.


Maturities of our long-term debt as of December 31, 2011 are as follows:


Maturities as of:   Total
  2012     $ 1,835,240  
  2013       2,315,274  
  2014       2,855,755  
  2015       3,474,639  
  2016       4,193,201  
  Thereafter       8,674,339  
  Total Long Term Debt     $ 23,348,448  
  Less: Debt discount       (1,477,842 )
  Long-term Debt, net of debt discount       21,870,606