Quarterly report pursuant to sections 13 or 15(d)


3 Months Ended
Mar. 31, 2012
Notes to Financial Statements  


Long - term debt consists of the following as of:


    March 31, 2012   December 31, 2011
Note payable - commercial bank   $ 1,142,127     $ 1,148,448  
Notes payable, net of debt discount - asset acquisition     21,752,243       20,722,158  
      22,894,370       21,870,606  
Less: Current portion     (1,952,211 )     (1,835,240 )
Total long – term debt   $ 19,516,475     $ 20,035,366  


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 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, but rather to GGLLC, a related party.

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 in the year ended December 31, 2011.


In October 2011 we closed an asset acquisition from Prime Table Games LLC and Prime Table Games UK. Included within the structure of the $23 million acquisition was a $22.2 million component consisting of two promissory notes, with one of the notes due in the amount of $12.2 million, payable in U.S. funds and a second note in the amount of £6.4 million, payable in British Sterling, which has been converted to U.S. dollars in our financial presentations at the rate of one (1) U.S. dollar is equal to 0.64 British pounds. The notes were recorded at fair value, net of a debt discount of $1,530,000.


Maturities of our long-term debt are as follows:



Maturities as of March 31,       Total  
2013       1,952,211  
2014       3,004,874  
2015       3,646,882  
2016       5,233,948  
Thereafter       6,610,347  
Total Long Term Debt       20,942,159  
Less: Debt discount       (1,425,684 )
Long-term Debt, net of debt discount     $ 19,516,475