Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 14, 2015 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Galaxy Gaming, Inc. | |
Entity Central Index Key | 13,156 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 39,065,591 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,015 |
Balance Sheets
Balance Sheets - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 247,160 | $ 560,184 |
Restricted cash | 136,321 | 107,913 |
Accounts receivables, net allowance for bad debts of $40,000 and $34,887 | 1,486,678 | 1,472,743 |
Prepaid expenses | 198,300 | 80,440 |
Inventories, net | 195,034 | 232,789 |
Note receivable – related party, current portion | 383,298 | 383,298 |
Deferred tax asset | 47,691 | 47,691 |
Other current assets | 70,740 | 62,584 |
Total current assets | 2,765,222 | 2,947,642 |
Intangible assets, net | 14,006,262 | 14,756,648 |
Goodwill | 1,091,000 | 1,091,000 |
Deferred tax assets, net of current portion | 159,640 | 143,614 |
Other assets, net | 43,605 | 45,416 |
Total assets | 18,546,092 | 19,492,083 |
Current liabilities: | ||
Accounts payable | 806,035 | 518,428 |
Accrued expenses | 530,867 | 519,166 |
Income taxes payable | 129,612 | 22,872 |
Deferred revenue | 682,711 | 647,625 |
Jackpot liabilities | 139,824 | 111,360 |
Current portion of capital lease obligations | 69,041 | 66,273 |
Current portion of long-term debt | 3,850,472 | 3,480,864 |
Total current liabilities | 6,208,562 | 5,366,588 |
Deferred rent | 57,927 | 56,242 |
Capital lease obligations, net of current portion | 101,972 | 137,204 |
Long-term debt, net of debt discount, net of current portion | 10,143,467 | 12,056,467 |
Total liabilities | $ 16,511,928 | $ 17,616,501 |
Commitments and Contingencies (See Note 12) | ||
Stockholders’ equity | ||
Preferred stock, 10,000,000 shares, $.001 par value preferred stock authorized; 0 shares issued and outstanding | ||
Common stock, 65,000,000 shares authorized; $.001 par value 39,065,591 and 38,990,591 shares issued and outstanding | $ 39,066 | $ 38,991 |
Additional paid-in capital | 2,899,355 | 2,844,488 |
Accumulated deficit | (845,868) | (980,300) |
Accumulated other comprehensive income (loss) | (58,389) | (27,597) |
Total stockholders’ equity | 2,034,164 | 1,875,582 |
Total liabilities and stockholders’ equity | 18,546,092 | 19,492,083 |
Property Plant and Equipment Excluding Assets Leased to Others | ||
Current assets: | ||
Property and equipment, net | 364,049 | 382,098 |
Products Leased and Held for Lease, Net | ||
Current assets: | ||
Property and equipment, net | $ 116,314 | $ 125,665 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Statement Of Financial Position [Abstract] | ||
Accounts receivables, net allowance for bad debts | $ 40,000 | $ 34,887 |
Preferred Stock, Shares authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Par Value | $ 0.001 | $ 0.001 |
Preferred Stock, Issued | 0 | 0 |
Preferred Stock, Outstanding | 0 | 0 |
Common Stock, Shares authorized | 65,000,000 | 65,000,000 |
Common Stock, par value | $ 0.001 | $ 0.001 |
Common Stock, Issued | 39,065,591 | 38,990,591 |
Common Stock, Outstanding | 39,065,591 | 38,990,591 |
Statements of Operations
Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Revenue: | ||||
Product leases and royalties | $ 2,677,384 | $ 2,461,354 | $ 5,255,696 | $ 4,722,163 |
Product sales and service | 5,216 | 1,175 | 10,999 | 5,177 |
Total revenue | 2,682,600 | 2,462,529 | 5,266,695 | 4,727,340 |
Costs and expenses: | ||||
Cost of ancillary products and assembled components | 23,989 | 17,620 | 47,278 | 36,940 |
Selling, general and administrative | 1,700,503 | 1,353,796 | 3,279,579 | 2,512,454 |
Research and development | 116,441 | 98,051 | 269,429 | 211,387 |
Depreciation | 43,018 | 28,451 | 84,311 | 42,744 |
Amortization | 372,313 | 389,634 | 750,386 | 779,133 |
Share-based compensation | 36,072 | 67,136 | 54,942 | 114,823 |
Total costs and expenses | 2,292,336 | 1,954,688 | 4,485,925 | 3,697,481 |
Income from operations | 390,264 | 507,841 | 780,770 | 1,029,859 |
Other income (expense): | ||||
Interest income | 5,320 | 5,827 | 11,205 | 11,454 |
Interest expense | (270,865) | (280,445) | (550,803) | (563,682) |
Total other expense | (265,545) | (274,618) | (539,598) | (552,228) |
Income before provision for income taxes | 124,719 | 233,223 | 241,172 | 477,631 |
Provision for income taxes | (53,146) | (123,846) | (106,740) | (217,089) |
Net income | $ 71,573 | $ 109,377 | $ 134,432 | $ 260,542 |
Basic income per share | $ 0 | $ 0 | $ 0 | $ 0.01 |
Diluted income per share | $ 0 | $ 0 | $ 0 | $ 0.01 |
Weighted average shares outstanding: | ||||
Basic | 39,065,591 | 38,535,591 | 39,028,091 | 38,459,897 |
Diluted | 39,065,591 | 38,626,603 | 39,028,508 | 38,537,558 |
Statements of Comprehensive Inc
Statements of Comprehensive Income - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net income | $ 134,432 | $ 260,542 |
Other comprehensive income: | ||
Foreign currency translation adjustments, net of tax | (30,792) | (162,258) |
Total comprehensive income | $ 103,640 | $ 98,284 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities: | ||
Net income for the period | $ 134,432 | $ 260,542 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation expense | 84,311 | 42,744 |
Amortization expense | 750,386 | 779,133 |
Provision for bad debt expense | 40,000 | |
Inventory reserve | 47,069 | |
Amortization of debt discount | 104,316 | 104,316 |
Deferred income tax provision | 202,506 | |
Share-based compensation | 54,942 | 114,823 |
Changes in operating assets and liabilities: | ||
Increase in restricted cash | (28,408) | (20,500) |
Increase in accounts receivable | (51,744) | (150,414) |
(Increase) decrease in other current assets | (8,156) | 17,743 |
Increase in inventory | (20,348) | (52,079) |
Increase in prepaid expenses | (117,860) | (59,804) |
Decrease in other long-term assets | (40,889) | |
Increase in accounts payable | 286,986 | 94,345 |
Increase in accrued expenses | 14,837 | 49,695 |
Increase in income taxes payable | 122,266 | |
Increase in deferred revenue | 35,086 | 70,287 |
Increase in jackpot liabilities | 28,464 | 23,021 |
Increase in deferred rent | 1,685 | 52,724 |
Net cash provided by operating activities | 1,558,504 | 1,407,953 |
Cash flows from investing activities: | ||
Acquisition of property and equipment | (44,066) | (8,791) |
Acquisition of intangible assets | (35,000) | |
Net cash used in investing activities | (44,066) | (43,791) |
Cash flows from financing activities: | ||
Principal payments on capital leases | (32,464) | (9,352) |
Principal payments on notes payable | (1,800,231) | (1,360,143) |
Net cash used in financing activities | (1,832,695) | (1,369,495) |
Effect of exchange rate changes on cash | 5,233 | 1,438 |
Net decrease in cash and cash equivalents | (313,024) | (3,895) |
Cash and cash equivalents – beginning of period | 560,184 | 438,502 |
Cash and cash equivalents – end of period | 247,160 | 434,607 |
Supplemental cash flow information: | ||
Cash paid for interest | 446,487 | 563,682 |
Inventory transferred to leased assets | 11,034 | 36,550 |
Supplemental non-cash financing activities information: | ||
Effect of exchange rate on note payable in foreign currency | $ 152,523 | 74,935 |
Assets acquired by capital leases | $ 243,970 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 6 Months Ended |
Jun. 30, 2015 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | NOTE 1. DESCRIPTION OF BUSINESS Unless the context indicates otherwise, references to “Galaxy Gaming, Inc.,” “we,” “us,” “our,” or the “Company,” refers to Galaxy Gaming, Inc., a Nevada corporation. “GGLLC” refers to Galaxy Gaming, LLC, a Nevada limited liability company that was a predecessor of the Company’s business, but is not directly associated with Galaxy Gaming, Inc. Description of business. We are an established global gaming company specializing in the design, development, manufacturing, marketing and acquisition of proprietary casino table games and associated technology, platforms and systems for the casino gaming industry. We are a leading supplier of gaming entertainment products worldwide and provide a diverse offering of quality products and services at competitive prices, designed to enhance the player experience. Casinos use our proprietary products to enhance their gaming floor operations and improve their profitability, productivity and security, as well as offer popular cutting-edge gaming entertainment content and technology to their players. We market our products to land-based, riverboat and cruise ship and internet gaming companies. The game concepts and the intellectual property associated with these games are typically protected by patents, trademarks and/or copyrights. We market our products primarily via our internal sales force to casinos throughout North America, the Caribbean, the British Isles, Europe, Africa and to cruise ships and internet gaming sites worldwide. We currently have an installed base of our products on over 4,000 gaming tables located in over 500 casinos, which positions us as the second largest provider of proprietary table games in the world. Revenues consist of primarily recurring royalties received from our clients for the licensing of our game content and other products. These recurring revenues generally have few direct costs thereby generating high gross profit margins. In lieu of reporting as gross profit revenues less cost of ancillary products and assembled components We group our products into four product categories we classify as “Proprietary Table Games,” “Enhanced Table Systems,” “e-Tables” and “Ancillary Equipment.” Our product categories are summarized below. Additional information regarding our products may be found on our web site, www.galaxygaming.com. Information found on the web site should not be considered part of this report. Proprietary Table Games. We design, develop and deliver our Proprietary Table Games to enhance our casino clients’ table game operations. Casinos use our Proprietary Table Games in lieu of those games in the public domain (e.g. Blackjack, Craps, Roulette, etc.) because of their popularity with players and to increase profitability. Our Proprietary Table Games are grouped into two product types we call “Side Bets” and “Premium Games.” Side Bets are proprietary features and wagering schemes typically added to public domain games such as poker, baccarat, pai gow poker, craps and blackjack table games. Examples of our side bets include such popular titles as Lucky Ladies , 21+3 and Bonus Craps . Premium Games are unique stand-alone games with their own unique set of rules and strategies. Examples of our Premium Games include such popular titles as High Card Flush, World Poker Tour Heads Up Hold’em , Three Card Poker, and Texas Shootout . Generally, Premium Games command a higher price point per unit than Side Bets. Enhanced Table Systems. Enhanced Table Systems are electronic enhancements used on casino table games to add to player appeal and enhance game security. We include three products in this category: our Bonus Jackpot System , our Inter-Casino Jackpot System and our MEGA-Share . Our Bonus Jackpot System Bonus Jackpot System Our Inter-Casino Jackpot System Bonus Jackpot System MEGA-Share is a game-play methodology invented by us that allows a player of one of our table games to share in the winnings of a jackpot together with other players. An example of this concept would be when multiple table game players are playing in a casino and one player obtains a winning hand entitling him or her to a jackpot. This jackpot winning event will trigger a second jackpot that is divided among all players who made a qualified wager. e-Tables. In 2011, we licensed the worldwide rights (excluding Oklahoma, Kentucky and the Caribbean), to the TableMAX e-Table system. Simultaneously we obtained the e-Table rights to the casino table games Caribbean Stud , Caribbean Draw , Progressive Blackjack , Texas Hold’em Bonus and Blackjack Bullets . See Note 17. The TableMAX e-Table system is a fully automated, dealer-less, multi-player electronic table game platform. These platforms allow us to offer our Proprietary Table Game content in markets where live table games are not permitted. Our e-Table product enables automation of certain components of traditional table games such as data collection, placement of bets, collection of losing bets and payment of winning bets. This automation provides benefits to both casino operators and players, including greater security and faster speed of play, reduced labor and other game related costs and increased profitability. Ancillary products . In 2014, we entered into an exclusive license for the worldwide rights to a patented technology that detects invisible card markings. With this technology, we developed SpectrumVision , which uses highly specialized and customized optics to see markings on playing cards that would otherwise be invisible or undetectable to the naked eye and surveillance cameras. SpectrumVision will be leased for a monthly fee or outright sale. Units sold may have a service contract issued in conjunction with the sale.. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SIGNIFICANT ACCOUNTING POLICIES This summary of our significant accounting policies is presented to assist in understanding our financial statements. The financial statements and notes are representations of our management team, who are responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America (“U.S. GAAP”) and have been consistently applied to the preparation of the financial statements. Basis of presentation. The accompanying financial statements have been prepared in accordance with U.S. GAAP and the rules of the SEC. In the opinion of management, all adjustments necessary in order for the financial statements to not be misleading have been reflected herein. Basis of accounting. The financial statements have been prepared on the accrual basis of accounting in conformity with U.S. GAAP. Revenues are recognized as income when earned and expenses are recognized when they are incurred. We do not have significant categories of cost as our income is recurring with high margins. Expenses such as wages, consulting expenses, legal, regulatory and professional fees and rent are recorded when the expense is incurred. Cash and cash equivalents. We consider cash on hand, cash in banks, certificates of deposit, and other short-term securities with maturities of three months or less when purchased, as cash and cash equivalents. Our bank accounts are deposited in insured institutions. The funds are insured up to $250,000 per account. To date, we have not experienced uninsured losses. Restricted cash. We are required by gaming regulation to maintain sufficient reserves in restricted accounts to be used for the purpose of funding payments to winners of our jackpots offered. Compliance with restricted cash requirements for jackpot funding is reported to gaming authorities in various jurisdictions. Inventory. Inventory consists of ancillary products such as signs, layouts, and bases for the various games and electronic devices and components to support our Enhanced Table Systems. Inventory value is determined by the average cost method and management maintains inventory levels based on historical and industry trends. We regularly assess inventory quantities for excess and obsolescence primarily based on forecasted product demand. See Note 5. Products leased and held for lease. We provide products whereby we maintain ownership and charge a fee for the use of the product. Since we retain title to the equipment, we classify these assets as “products leased and held for lease” and they are shown on the accompanying balance sheets. These assets are stated at cost, net of depreciation. Depreciation on leased products is calculated using the straight-line method over a three year period. Property and equipment. Property and equipment are being depreciated over their estimated useful lives, 3 to 5 years, using the straight-line method of depreciation for book purposes. Intellectual property and intangible assets. These intellectual property and intangible assets have finite lives and are being amortized using the straight-line method over their economic useful lives, five to thirty years. Material assets added over the past several years are as follows: Client installation base 60 months Licensing agreements 60 months Patents 87 - 132 months Trademarks 144 - 360 months Client relationships 264 months The intangible assets are analyzed for potential impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable. Goodwill. A goodwill balance of $1,091,000 was created as a result of the PTG asset acquisition. This asset will be assessed for impairment at least annually and if found to be impaired, its carrying amount will be reduced and an impairment loss will be recognized. Impairment of long-lived assets. We continually monitor events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. Leases. We recognize rent expense for operating leases on a straight-line basis (including the effect of reduced or free rent and rent escalations) over the applicable lease term. The difference between the cash paid to the landlord and the amount recognized as rent expense on a straight-line basis is included in deferred rent. The landlord of our corporate headquarters financed leasehold improvements in the amount of $150,000. See Note 12. These improvements have been recorded as a capital lease and amortized over the life of the lease. Concentration of risk. We are exposed to risks associated with clients who represent a significant portion of total revenues. For the six months ended June 30, 2015 and 2014, we had the following client revenue concentrations: Location 2015 Revenue 2014 Revenue Client A North America 15.1% 15.3% Client B United Kingdom 6.7% 8.3% Client C North America 5.4% 4.9% Client D North America 5.1% 3.9% We are also exposed to risks associated with the expiration of our patents. In 2015, domestic and international patents will expire on two of our products, which account for approximately $2,845,545 or 54% of our revenue for the six months ended June 30, 2015. Revenue recognition. Revenue is primarily derived from the licensing of our products and intellectual property. Consistent with our strategy, revenue is generated from negotiated month-to-month recurring licensing fees or the performance of our products, or both. We also, occasionally, receive a one-time sale of certain products and/or reimbursement of our manufactured equipment. Substantially, all of our revenue is recognized when it is earned. Depending upon the product and negotiated terms, our clients may be invoiced monthly in advance, monthly in arrears or quarterly in arrears for the licensing of our products. If billed in advance, the advance billings are recorded as deferred revenue on our balance sheet. If billed in arrears, we recognize the corresponding preceding period’s revenue upon invoicing at the subsequent date. Generally, we begin earning revenue with the installation or “go live” date of the associated product in our clients’ establishment. The monthly recurring invoices are based on executed agreements with each client. Additionally, clients may be invoiced for product sales at the time of shipment or delivery of the product. Revenue from the sale of our associated products is recognized when the following criteria are met: (1) Persuasive evidence of an arrangement between us and our client exists; (2) Shipment has occurred; (3) The price is fixed and/or determinable; and (4) Collectability is reasonably assured or probable. The combination of hardware and software included in our Enhanced Table Systems and e-Tables is essential to the operation of the respective systems. As such, we do not segregate the portion of revenue between manufactured equipment and any software or electronic devices needed to use the equipment when the system is provided. We do not market the software separately from the equipment. Costs of ancillary products and assembled components. Ancillary products include paytables (display of payouts), bases, layouts, signage and other items as they relate to support specific proprietary games in connection with the licensing of our games. Assembled components represent the cost of the equipment, devices and incorporated software used to support the Bonus Jackpot System and SpectrumVision . Research and development. We incur research and development (“R&D”) costs to develop our new and next-generation products. Our products reach commercial feasibility shortly before the products are released and therefore R&D costs are expensed as incurred. Employee-related costs associated with product development are included in R&D costs. Foreign currency translation. For non-US functional accounts, assets and liabilities are translated at exchange rates in effect at the balance sheet date, and income and expense accounts at the average exchange rates for the year. Resulting currency translation adjustments are recorded as a separate component of shareholders’ equity. We record foreign currency transactions at the exchange rate prevailing at the date of the transaction with resultant gains and losses being included in results of operations. Realized foreign currency transaction gains and losses have not been significant for any period presented. Income taxes. We use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carry-forwards. These temporary differences will result in deductible or taxable amounts in future years when the reported amounts of the assets or liabilities are recovered or settled. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some or all of the deferred tax assets may not be realized. Adjustments to the valuation allowance increase or decrease our income tax provision or benefit. We follow the provisions contained in Accounting Standards Codification (“ASC”) Topic 740, Income Taxes. We recognize the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. Judgment is required in determining the provision for incomes taxes and related accruals, deferred tax assets and liabilities. In the ordinary course of business, there are transactions and calculations where the ultimate tax outcome is uncertain. Additionally, our tax returns are subject to audit by various tax authorities. Although we believe that our estimates are reasonable, actual results could differ from these estimates Basic income (loss) per share. Basic earnings per share is calculated by dividing net income by the weighted average number of common shares issued and outstanding during the year. Diluted earnings per share is similar to basic, except that the weighted average number of shares outstanding is increased by the potentially dilutive effect of outstanding stock options and warrants, if applicable, during the year, using the treasury stock method. Stock-based compensation. We measure and recognize all stock-based compensation, including restricted stock and stock-based awards to employees, under the fair value method. We measure the fair value of stock-based awards using the Black-Scholes model and restricted shares using the grant date fair value of the stock. Compensation is attributed to the periods of associated service and such expense is recognized on a straight-line basis over the vesting period of the awards. Forfeitures are estimated at the time of grant, with such estimate updated when the expected forfeiture rate changes. Use of estimates and assumptions. We are required to make estimates, judgments and assumptions that we believe are reasonable based on our historical experience, contract terms, observance of known trends in our company and the industry as a whole, and information available from other outside sources. Our estimates affect reported amounts for assets, liabilities, revenues, expenses and related disclosures. Actual results may differ from initial estimates. Reclassifications. Certain accounts and financial statement captions in the prior periods have been reclassified to conform to the current period financial statements. Recently adopted accounting standards – not adopted We believe there is no additional new accounting guidance adopted, but not yet effective, which is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on its financial reporting. |
NOTE RECEIVABLE - RELATED PARTY
NOTE RECEIVABLE - RELATED PARTY | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transaction [Line Items] | |
RELATED PARTY TRANSACTIONS | NOTE 14. RELATED PARTY TRANSACTIONS Through April 2014, we leased our prior offices located on O’Bannon Drive in Las Vegas from the Saucier Business Trust, an entity that is related to our CEO. The lease was entered into effective September 1, 2010 for a period of two years requiring a monthly rental payment of $10,360. Our lease expired at the end of August 2012 and then converted to a term of month-to-month. Total payments made were $-0- and $37,296 for the six month periods ended June 30, 2015 and 2014, respectively. We have a note receivable from Abyss Group, LLC (“Abyss”), an entity that was formerly related to the wife of our CEO. Subsequently, Abyss assigned the note to Carpathia Associates, LLC (“Carpathia”), an entity controlled by our CEO. This note receivable was acquired as part of the 2007 asset purchase agreement with GGLLC. The 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. The terms of the note were amended whereby the monthly principal and interest payment was reduced to $3,332 and the unpaid principal and interest is due August 2015. The balance as of June 30, 2015 and December 31, 2014 was $383,298 and $383,298, respectively. Interest income associated with this note receivable was $11,523 and $11,145 for the six month periods ended June 30, 2015 and 2014, respectively. We have a note payable to a related party, GGLLC, an entity formerly controlled by our CEO. Subsequently, GGLLC assigned the note to Carpathia. The note payable requires monthly principal and interest payments of $9,159, at a fixed interest rate of 7.3% through February 2017, at which time there is a balloon payment due of $1,003,000. The balance as of June 30, 2015 and December 31, 2014 was $1,049,442 and $1,065,324, respectively. This note payable is a result of the asset purchase agreement with GGLLC. |
Note Receivable | |
Related Party Transaction [Line Items] | |
RELATED PARTY TRANSACTIONS | NOTE 3. NOTE RECEIVABLE – RELATED PARTY The note receivable balance was as follows: June 30, 2015 December 2014 Note receivable $ 383,298 $ 383,298 Less: current portion (383,298 ) (383,298 ) Long-term note receivable $ — $ — A note receivable was acquired as part of the 2007 asset purchase agreement with GGLLC. The 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. 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. Interest income associated with this note receivable was $11,523 and $11,145 for the six months ended June 30, 2015 and 2014, respectively. At June 30, 2015, there was an interest receivable balance of $52,095 which is included in other current assets. 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 June 30, 2015 and December 31, 2014, management believed that 100% of the note receivable principal and interest amounts are collectible. |
PREPAID EXPENSES
PREPAID EXPENSES | 6 Months Ended |
Jun. 30, 2015 | |
Prepaid Expense And Other Assets [Abstract] | |
PREPAID EXPENSES | NOTE 4. PREPAID EXPENSES Prepaid expenses consisted of the following at: June 30, 2015 December 2014 Compliance $ 62,556 $ - IT systems 39,385 9,304 Travel 25,109 8,587 Trade show expense 22,999 7,000 Dues & subscriptions 21,474 14,562 Insurance 18,131 16,612 Professional services 6,287 21,863 Rent 1,989 1,989 Other prepaid expenses 370 523 Prepaid expenses $ 198,300 $ 80,440 |
INVENTORY
INVENTORY | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 5. INVENTORY Inventory consisted of the following at: June 30, 2015 December 2014 Raw materials and component parts $ 101,775 $ 111,246 Finished goods 74,993 96,254 Work-in-process 53,266 69,464 230,034 276,964 Less: inventory reserve (35,000 ) (44,175 ) Inventory $ 195,034 $ 232,789 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2015 | |
Property Plant And Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 6. PROPERTY AND EQUIPMENT Property and equipment, recorded at cost, consisted of the following at: June 30, 2015 December 31, 2014 Leasehold improvements $ 156,843 $ 150,000 Furniture and fixtures 211,411 197,751 Computer equipment 87,631 84,186 Automotive vehicles 94,087 86,364 Office equipment 29,140 17,403 579,112 535,704 Less: accumulated depreciation (215,063 ) (153,606 ) Property and equipment, net $ 364,049 $ 382,098 Included in depreciation expense was $62,115 and $24,926 related to property and equipment for the six months ended June 30, 2015 and 2014, respectively. Property and equipment includes $243,970 of leasehold improvements, furniture and fixtures under capital leases as of June 30, 2015. Accumulated depreciation of assets under capital leases totaled $73,631 as of June 30, 2015. |
PRODUCTS LEASED AND HELD FOR LE
PRODUCTS LEASED AND HELD FOR LEASE | 6 Months Ended |
Jun. 30, 2015 | |
Leases Operating [Abstract] | |
PRODUCTS LEASED AND HELD FOR LEASE | NOTE 7. PRODUCTS LEASED AND HELD FOR LEASE Products leased and held for lease consisted of the following at: June 30, 2015 December 2014 Enhanced table systems $ 244,530 $ 233,496 Less: accumulated depreciation (128,216 ) (107,831 ) Products leased and held for lease, net $ 116,314 $ 125,665 Included in depreciation expense was $20,385 and $16,008 related to products leased and held for lease for the six months ended June 30, 2015 and 2014, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 8. INTANGIBLE ASSETS Intellectual property and intangible assets consisted of the following at: June 30, 2015 December 2014 Patents $ 13,615,967 $ 13,615,967 Customer relationships 3,400,000 3,400,000 Trademarks 2,740,000 2,740,000 Non-compete agreements 660,000 660,000 Licensing agreements 35,000 35,000 20,450,967 20,450,967 Less: accumulated amortization (6,444,705 ) (5,694,319 ) Intangible assets, net $ 14,006,262 $ 14,756,648 Amortization expense was $750,386 and $779,133 for the six months ended June 30, 2015 and 2014, respectively. In October 2011, we acquired the following intangible assets related to the asset purchase with Prime Table Games LLC and Prime Table Games UK (collectively “Prime Table Games”): Fair Value Patents $ 13,259,000 Customer relationships 3,400,000 Trademarks 2,740,000 Goodwill 1,091,000 Non-compete agreement 660,000 Total acquired intangible assets $ 21,150,000 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2015 | |
Payables And Accruals [Abstract] | |
ACCRUED EXPENSES | NOTE 9. ACCRUED EXPENSES Accrued expenses, consisted of the following at: June 30, 2015 December 2014 Royalties $ 138,570 $ 59,715 Salaries & payroll taxes 68,599 70,262 TableMAX reimbursement 77,346 72,636 Vacation 68,418 58,642 Commissions 51,405 148,902 Trade show expenses 89,424 41,666 Professional fees 31,633 60,779 Accrued interest 3,645 3,686 Other accrued expenses 1,827 2,878 Accrued expenses $ 530,867 $ 519,166 |
CAPITAL LEASE OBLIGATIONS
CAPITAL LEASE OBLIGATIONS | 6 Months Ended |
Jun. 30, 2015 | |
Leases [Abstract] | |
CAPITAL LEASE OBLIGATIONS | NOTE 10. CAPITAL LEASE OBLIGATIONS Capital lease obligations consisted of the following at: June 30, 2015 December 2014 Capital lease obligation – leasehold improvements $ 121,450 $ 135,171 Capital lease obligation – office furniture 49,563 68,306 171,013 203,477 Less: Current portion (69,041 ) (66,273 ) Capital lease obligations $ 101,972 $ 137,204 The capital lease obligation – office furniture requires 30 monthly payments of $3,641, including interest at 10.2%, beginning April 2014 through September 2016. The capital lease obligation – leasehold improvements requires 60 monthly payments of $2,879, including 5.5% interest, beginning May 2014 through May 2019. The capital leases cover furniture and leasehold improvements located at our corporate headquarters in Las Vegas, Nevada. Annual requirements for capital leases obligations are as follows: June 30, Total 2016 $ 78,237 2017 43,769 2018 34,545 2019 31,666 Total minimum lease payments $ 188,217 Less: amount representing interest (17,204 ) Present value of net minimum lease payments $ 171,013 |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 11. NOTES PAYABLE Notes payable consisted of the following at: June 30, 2015 December 2014 Notes payable, net of debt discount - PTG $ 12,865,893 $ 14,385,643 Note payable – related party 1,049,442 1,065,324 Vehicles, notes payable 78,604 86,364 13,993,939 15,537,331 Less: Current portion (3,850,472 ) (3,480,864 ) Total long-term debt $ 10,143,467 $ 12,056,467 The note payable – related party requires monthly principal and interest payments of $9,159, at a fixed interest rate of 7.3% through February 2017, at which time there is a balloon payment due of $1,003,000. This note payable is a result of the asset purchase agreement with GGLLC. The note payable between GGLLC and Bank of America was the subject of litigation and was settled in February 2014. See Note 12 for further details. In October 2011, we closed an asset acquisition with Prime Table Games (“PTG”). Included within the structure of the $23 million acquisition was a $22.2 million component consisting of two promissory notes: 1) a note payable for $12.2 million, and 2) a note payable for £6.4 million GBP ($10.0 million USD) note. The notes were recorded at fair value, net of a debt discount of $1,530,000. See Note 17 for further details. Maturities of our notes payable are as follows: Maturities as of June 30, Total 2016 $ 3,850,412 2017 5,307,513 2018 4,563,279 2019 1,010,783 2020 9,582 Total notes payable $ 14,741,569 Less: debt discount (747,630 ) Notes payable, net of debt discount $ 13,993,939 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 12. COMMITMENTS AND CONTINGENCIES Operating lease obligations. In February 2014, we entered into a lease (the “Spencer Lease”) for a new corporate office with an unrelated third party. The 5-year Spencer Lease is for a building approximately 24,000 square feet in size, which is comprised of approximately 16,000 square feet of office space and an 8,000 square foot warehouse. The property is located in Las Vegas, Nevada. The initial term of the Spencer Lease commenced on April 1, 2014. We paid approximately $153,000 in annual base rent in the first year, which increases by approximately 4% each year. We are also obligated to pay real estate taxes and other building operating costs. Subject to certain conditions, we have certain rights under the Spencer Lease, including rights of first offer to purchase the premises if the landlord elects to sell. We also have an option to extend the term of the Spencer Lease for two consecutive terms of three years each, at the then current fair market value rental rate determined in accordance with the terms of the Spencer Lease. In connection with the Spencer Lease, the landlord has agreed to finance tenant improvements (“TI Allowance”) of $150,000. The base rent is increased by an amount sufficient to fully amortize the TI Allowance through the Spencer Lease term upon equal monthly payments of principal and interest, with interest imputed on the outstanding principal balance at the rate of 5.5% per annum. The TI Allowance has been classified as a capital lease on the balance sheet. See Note 10. Pursuant to the Spencer Lease, we have the option to terminate the Spencer Lease effective at the end of the 36th month (“Termination Date”). We must deliver written notice of our intention to terminate the Spencer Lease to the landlord at least six months before the Termination Date. In the event we exercise our option to terminate, we must pay the landlord a termination fee equal to the sum of (i) all unamortized TI Allowance amounts, plus (ii) all unamortized leasing commissions paid by landlord with respect to the Spencer Lease, plus (iii) all unamortized rental abatement amounts. Total rent expense was $145,448 and $127,685 for the six months ended June 30, 2015 and 2014, respectively. Future minimum lease payments are as follows: Twelve Months Ended June 30, Annual Obligation 2016 $ 218,304 2017 227,052 2018 235,788 2019 244,524 2020 2,802 Total Estimated Lease Obligations $ 928,470 Legal proceedings. In the ordinary course of conducting our business, we are, from time to time, involved in various legal proceedings, administrative proceedings, regulatory government investigations and other matters, including those in which we are a plaintiff, that are complex in nature and have outcomes that are difficult to predict. In accordance with topic ASC Topic 450, we record accruals for such contingencies to the extent that we conclude that it is probable that a liability will be incurred and the amount of the related loss can be reasonably estimated. Our assessment of each matter may change based on future unexpected events. An unexpected adverse judgment in any pending litigation could cause a material impact on our business operations, intellectual property, results of operations or financial position. Unless otherwise expressly stated, we believe costs associated with litigation will not have a material impact on our financial position or liquidity, but may be material to the results of operations in any given period. We assume no obligation to update the status of pending litigation, except as may be required by applicable law, statute or regulation. For a complete description of the facts and circumstances surrounding material litigation to which we are a party, see Note 11 in Item 8. “Financial Statements and Supplementary Data” included in our annual report on Form 10-K for the year ended December 31, 2014. There are no material updates to matters previously reported on Form 10-K for the year ended December 31, 2014, except: In-Bet litigation. In November 2014, we filed a complaint for patent infringement against In Bet Gaming, Inc. and In Bet, LLC, alleging that their “In-Between” side bet game infringes on one or more of our patents. The litigation is currently pending. Red Card Gaming & AGS litigation . In September 2012, we executed an asset purchase agreement (“APA”) with Red Card Gaming, Inc. (“RCG”), for the purchase of all the rights, title and interest in and for the game known as and all associated intellectual property. The APA included customary non-compete, non-disparagement and right of first refusal provisions. In 2014, AGS, LLC (“AGS”) purchased RCG’s rights in the APA and became the assignee of the APA. In September 2014 we notified RCG of their material breach of the APA and discontinued contingent consideration payments. In November 2014, RCG and AGS attempted to terminate the APA and in December 2014, filed a complaint against us alleging trademark infringement. We filed a cross-complaint against RCG and AGS alleging conspiracy to breach the APA, misappropriation of our trade secrets, infringement of our trademark and copy rights and interference with customer relationships. As of the date of this Report, there were pending cross motions for preliminary injunctions in which the parties seek to enjoin each other from selling the game. The parties have agreed the substance of the dispute is to be heard in arbitration, which is scheduled for November 2015. |
STOCKHOLDERS EQUITY
STOCKHOLDERS EQUITY | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
STOCKHOLDERS EQUITY | NOTE 13. STOCKHOLDERS’ EQUITY We had 65,000,000 shares of $.001 par value common stock and 10,000,000 shares of $.001 par value preferred stock authorized as of June 30, 2015. In February 2014, an independent contractor (the “Contractor”) was granted 150,000 shares of our restricted common stock. Of this amount, 75,000 vested and transferred immediately, and the remaining 75,000 vested in equal installments through (and transferred on) January 1, 2015. In March 2014, Norm DesRosiers, one of our Directors, was granted 100,000 shares of our restricted common stock as condition of his Board of Directors Director Service Agreement. The fair market value of the grant was $28,000, which was determined using our closing stock price at March 1, 2014. The restricted stock grant vested immediately. In May 2014, William A. Zender, one of our Directors, was granted 75,000 shares of our restricted common stock as a condition of his Board of Directors Director Service Agreement. The fair market value of the grant was $35,250, which was determined using our closing stock price at May 1, 2014, the date of the grant. The restricted stock grant vested immediately. In December 2014, the Board of Directors approved a stock grant for a small group of employees that granted 255,000 shares of restricted common stock. The fair market value of the grant was $102,000, which was determined using our closing stock price at December 29, 2014, the date of the grant. The restricted stock grant vested immediately. In December 2014, the Compensation Committee of the Board of Directors approved a bonus in the form of stock compensation to our Chief Financial Officer Gary A. Vecchiarelli, based on Mr. Vecchiarelli’s individual performance. The stock grant was for 100,000 restricted shares of our common stock with a fair market value of $40,000. The value of the bonus was determined using our closing stock price at December 29, 2014, the date of the grant. In April 2015, Bryan Waters, one of our Directors, was granted 75,000 shares of our restricted common stock as condition of his Board of Directors Director Service Agreement. The fair market value of the grant was $22,500, which was determined using our closing stock price as April 1, 2015, the date of the grant. The restricted stock grant vested immediately. There were 39,065,591 common shares and no preferred shares issued and outstanding at June 30, 2015. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 14. RELATED PARTY TRANSACTIONS Through April 2014, we leased our prior offices located on O’Bannon Drive in Las Vegas from the Saucier Business Trust, an entity that is related to our CEO. The lease was entered into effective September 1, 2010 for a period of two years requiring a monthly rental payment of $10,360. Our lease expired at the end of August 2012 and then converted to a term of month-to-month. Total payments made were $-0- and $37,296 for the six month periods ended June 30, 2015 and 2014, respectively. We have a note receivable from Abyss Group, LLC (“Abyss”), an entity that was formerly related to the wife of our CEO. Subsequently, Abyss assigned the note to Carpathia Associates, LLC (“Carpathia”), an entity controlled by our CEO. This note receivable was acquired as part of the 2007 asset purchase agreement with GGLLC. The 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. The terms of the note were amended whereby the monthly principal and interest payment was reduced to $3,332 and the unpaid principal and interest is due August 2015. The balance as of June 30, 2015 and December 31, 2014 was $383,298 and $383,298, respectively. Interest income associated with this note receivable was $11,523 and $11,145 for the six month periods ended June 30, 2015 and 2014, respectively. We have a note payable to a related party, GGLLC, an entity formerly controlled by our CEO. Subsequently, GGLLC assigned the note to Carpathia. The note payable requires monthly principal and interest payments of $9,159, at a fixed interest rate of 7.3% through February 2017, at which time there is a balloon payment due of $1,003,000. The balance as of June 30, 2015 and December 31, 2014 was $1,049,442 and $1,065,324, respectively. This note payable is a result of the asset purchase agreement with GGLLC. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 15. INCOME TAXES Our forecasted effective tax rate at June 30, 2015 is 47.3%, a 1.8% increase from the 45.5% effective tax rate recorded at June 30, 2014. No discrete items were recorded for the six months ending June 30, 2015. |
STOCK OPTIONS AND WARRANTS
STOCK OPTIONS AND WARRANTS | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
STOCK OPTIONS AND WARRANTS | NOTE 16. STOCK WARRANTS, OPTIONS AND GRANTS Warrant activity. We have accounted for warrants as equity instruments in accordance with EITF 00-19 (ASC 815-40) Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock , and as such, will be classified in stockholders’ equity as they meet the definition of “…indexed to the issuer’s stock” in EITF 01-06 (ASC 815-40) The Meaning of Indexed to a Company’s Own Stock . In prior years, we estimated the fair value of the warrants using the Black-Scholes option pricing model based on assumptions at the time of issuance. A summary of current warrant activity is as follows: Common Weighted Average Exercise Price Outstanding – January 1, 2014 616,667 $ 0.56 Issued — — Exercised — — Expired (616,667 ) 0.56 Outstanding – December 31, 2014 — — Issued — — Exercised — — Expired — — Outstanding – June 30, 2015 — $ — Exercisable – June 30, 2015 — $ — Stock options. For the six months ended June 30, 2015 and 2014, we issued 300,000 and 114,583 stock options, respectively. Stock options issued to members of our Board of Directors were 125,000 and 58,333 for the six months ended June 30, 2015 and 2014, respectively. Stock options issued to independent contractors were 75,000 and 56,250 for the six months ended June 30, 2015 and 2014, respectively. During the six months ended June 30, 2015, we issued 100,000 stock options to an employee, which vest over a period of three years. The strike price was equal to the stock price at the date of the grant. All stock options granted for the six months ended June 30, 2015 and 2014 were calculated to have fair values of $48,027 and $30,672, respectively, using the Black-Scholes option pricing model with the following assumptions: Options Issued Six Months Ended June 30, 2015 Dividend yield 0 % Expected volatility 85 % Risk free interest rate 1.63 % Expected life (years) 5.00 A summary of stock option activity is as follows: Common Weighted Average Exercise Price Outstanding – January 1, 2014 100,000 $ 0.25 Issued 281,250 0.41 Exercised — — Expired — — Outstanding – December 31, 2014 381,250 $ 0.41 Issued 300,000 0.26 Exercised — — Expired — — Outstanding – June 30, 2015 681,250 $ 0.32 Exercisable – June 30, 2015 592,361 $ 0.32 Share based compensation. The cost of all stock options and stock grants issued have been classified as share based compensation for the six months ended June 30, 2015 and 2014, respectively. Total share based compensation was $54,942 and $114,823 for the six months ended June 30, 2015 and 2014, respectively. |
ASSET ACQUISITIONS AND SIGNIFIC
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS | NOTE 17. ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS Acquisition of Prime Table Games’ assets . In October 2011, we executed an asset purchase agreement (the “PTG Agreement”) with Prime Table Games, LLC and Prime Table Games UK (collectively “Prime Table Games”). Under the terms of the PTG Agreement we acquired over 20 different table games, including 21+3, Two-way Hold'em and Three Card Poker , which are currently played in over 250 casinos worldwide ( Three Card Poker rights are limited to the British Isles). The intellectual property portfolio included 36 patents, 11 patents pending, 96 worldwide trademark and design registrations and 47 domain name registrations. The two principals of Prime Table Games also executed a non-compete agreement with us. We accounted for the asset purchase as a business combination using the acquisition method of accounting which requires, among other things, that assets acquired and liabilities assumed be recognized at their fair values as of the purchase date and be recorded on the balance sheet regardless of the likelihood of success of the related product or technology. The process for estimating the fair values of identifiable intangible assets involves the use of significant estimates and assumptions, including estimating future cash flows and developing appropriate discount rates. Transaction costs are not included as a component of consideration transferred and were expensed as incurred. Consideration transferred . The acquisition-date fair value of the consideration transferred consisted of the following items: Common stock – 2,000,000 shares $ 480,000 Note payable – Prime Table Games LLC 12,200,000 Note payable – Prime Table Games UK 10,000,000 Total $ 22,680,000 See Note 11 for details regarding the notes payable. Fair value estimate of assets acquired and liabilities assumed . The total purchase consideration is allocated to Prime Table Games intangible assets based on their estimated fair values as of the closing date. The allocation of the total purchase price to the net assets acquired is as follows: Patents $ 13,259,000 Customer relationships 3,400,000 Trademarks 2,740,000 Debt discount 1,530,000 Goodwill 1,091,000 Non-compete agreement 660,000 Total purchase price allocation $ 22,680,000 As of December 31, 2014, we determined several patents purchased as part of this transaction to be impaired and reduced the carrying value of the intangible asset to zero during 2014. The total impairment charge recognized for these patents as of December 31, 2014, was $528,233. TableMAX agreement . In February 2011, we entered into a definitive agreement (“TMAX Agreement”) with TableMAX Corporation (“TMAX”) a provider of electronic table games and platforms headquartered in Las Vegas, Nevada and a principal investor in TMAX. Under the terms of the TMAX Agreement, we have exclusive worldwide rights (excluding one international territory and two U.S. states) to the TMAX electronic gaming platform and certain game titles. We created an operating division (the “TableMAX Division”) which conducts sales, distribution, marketing, engineering, sub-licensing and manufacturing related to the TMAX products and related intellectual property. The TableMAX Division is wholly-owned by us and is not considered owned by, related to, a joint venture partner of or an agent of TMAX in any manner. The term of the TMAX Agreement is five years. At any time during the term of the TMAX Agreement, either TMAX or we may make a written offer to purchase the sole ownership of the TableMAX Division. Such offer shall be subject to the parties’ mutual agreement and neither party shall be under any obligation to accept such an offer. If such an agreement has not been consummated within six months of the expiration of the TMAX Agreement, then each party must indicate to the other party no later than six months from the scheduled expiration of the TMAX Agreement, their intent to renew the TMAX Agreement for a term of at least one year, or terminate. TMAX agreed to assign, for the term of the TMAX Agreement, all of its existing gaming installations and usable inventory to the TableMAX Division. We agreed to furnish our intellectual property relating to our table game content for use by the TableMAX Division, royalty-free for the term of the TMAX Agreement. The TMAX Agreement specifies annual performance targets whereby we are required, on a cumulative basis, to have minimum table placements. If we fail to meet the performance criteria as defined in the TMAX Agreement, we will be required to pay TMAX the difference between TMAX’s share of the actual profit obtained by the TableMAX Division and the estimated profit that would have been obtained if the minimum performance criteria had been obtained. We are responsible for the losses of the TableMAX Division. Net profits from the TableMAX Division will be split between TMAX and us on a sliding scale basis dependent upon the number of TableMAX Division table installations and profit results as defined in the TMAX Agreement. We have not experienced significant losses attributable to the TableMAX Division. Included in accrued expenses at June 30, 2015 and December 31, 2014, is $77,346 and $72,636, respectively, which represent reimbursement due to TMAX. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18. SUBSEQUENT EVENTS On August 10, 2015, our Board of Directors approved an agreement between the Company and Carpathia Associates, LLC, an entity which is owned and controlled by our Chief Executive Officer, Robert Saucier (the “Agreement”). The Agreement amends the terms of the note receivable and note payable previously entered into between the parties by offsetting the note receivable and note payable between the two parties. The effective result will be that the balloon payment of $437,313, due under the terms of the note receivable from Carpathia, will be applied to the outstanding note payable due to Carpathia. The Board believes that the Company benefits from the arrangement as the Agreement extends the note payable’s balloon payment from February 2017 to December 2018. The balloon payment due in December 2018 will be $354,480. In accordance with ASC 855-10, we have analyzed our operations subsequent to June 30, 2015 to the date of these financial statements were issued, and have determined that we do not have any material subsequent events to disclose in these financial statements other than the events discussed above. |
SIGNIFICANT ACCOUNTING POLICI25
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Basis of presentation and Basis of accounting | Basis of presentation. The accompanying financial statements have been prepared in accordance with U.S. GAAP and the rules of the SEC. In the opinion of management, all adjustments necessary in order for the financial statements to not be misleading have been reflected herein. Basis of accounting. The financial statements have been prepared on the accrual basis of accounting in conformity with U.S. GAAP. Revenues are recognized as income when earned and expenses are recognized when they are incurred. We do not have significant categories of cost as our income is recurring with high margins. Expenses such as wages, consulting expenses, legal, regulatory and professional fees and rent are recorded when the expense is incurred. |
Cash and cash equivalents | Cash and cash equivalents. We consider cash on hand, cash in banks, certificates of deposit, and other short-term securities with maturities of three months or less when purchased, as cash and cash equivalents. Our bank accounts are deposited in insured institutions. The funds are insured up to $250,000 per account. To date, we have not experienced uninsured losses. |
Restricted cash | Restricted cash. We are required by gaming regulation to maintain sufficient reserves in restricted accounts to be used for the purpose of funding payments to winners of our jackpots offered. Compliance with restricted cash requirements for jackpot funding is reported to gaming authorities in various jurisdictions. |
Inventory | Inventory. Inventory consists of ancillary products such as signs, layouts, and bases for the various games and electronic devices and components to support our Enhanced Table Systems. Inventory value is determined by the average cost method and management maintains inventory levels based on historical and industry trends. We regularly assess inventory quantities for excess and obsolescence primarily based on forecasted product demand. See Note 5. |
Products leased and held for lease | Products leased and held for lease. We provide products whereby we maintain ownership and charge a fee for the use of the product. Since we retain title to the equipment, we classify these assets as “products leased and held for lease” and they are shown on the accompanying balance sheets. These assets are stated at cost, net of depreciation. Depreciation on leased products is calculated using the straight-line method over a three year period. |
Property and equipment | Property and equipment. Property and equipment are being depreciated over their estimated useful lives, 3 to 5 years, using the straight-line method of depreciation for book purposes |
Intellectual property and intangible assets | Intellectual property and intangible assets. These intellectual property and intangible assets have finite lives and are being amortized using the straight-line method over their economic useful lives, five to thirty years. Material assets added over the past several years are as follows: Client installation base 60 months Licensing agreements 60 months Patents 87 - 132 months Trademarks 144 - 360 months Client relationships 264 months The intangible assets are analyzed for potential impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable. |
Goodwill | Goodwill. A goodwill balance of $1,091,000 was created as a result of the PTG asset acquisition. This asset will be assessed for impairment at least annually and if found to be impaired, its carrying amount will be reduced and an impairment loss will be recognized. |
Impairment of long-lived assets | Impairment of long-lived assets. We continually monitor events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. |
Leases | Leases. We recognize rent expense for operating leases on a straight-line basis (including the effect of reduced or free rent and rent escalations) over the applicable lease term. The difference between the cash paid to the landlord and the amount recognized as rent expense on a straight-line basis is included in deferred rent. The landlord of our corporate headquarters financed leasehold improvements in the amount of $150,000. See Note 12. These improvements have been recorded as a capital lease and amortized over the life of the lease. |
Concentration of risk | Concentration of risk. We are exposed to risks associated with clients who represent a significant portion of total revenues. For the six months ended June 30, 2015 and 2014, we had the following client revenue concentrations: Location 2015 Revenue 2014 Revenue Client A North America 15.1% 15.3% Client B United Kingdom 6.7% 8.3% Client C North America 5.4% 4.9% Client D North America 5.1% 3.9% We are also exposed to risks associated with the expiration of our patents. In 2015, domestic and international patents will expire on two of our products, which account for approximately $2,845,545 or 54% of our revenue for the six months ended June 30, 2015. |
Revenue Recognition | Revenue recognition. Revenue is primarily derived from the licensing of our products and intellectual property. Consistent with our strategy, revenue is generated from negotiated month-to-month recurring licensing fees or the performance of our products, or both. We also, occasionally, receive a one-time sale of certain products and/or reimbursement of our manufactured equipment. Substantially, all of our revenue is recognized when it is earned. Depending upon the product and negotiated terms, our clients may be invoiced monthly in advance, monthly in arrears or quarterly in arrears for the licensing of our products. If billed in advance, the advance billings are recorded as deferred revenue on our balance sheet. If billed in arrears, we recognize the corresponding preceding period’s revenue upon invoicing at the subsequent date. Generally, we begin earning revenue with the installation or “go live” date of the associated product in our clients’ establishment. The monthly recurring invoices are based on executed agreements with each client. Additionally, clients may be invoiced for product sales at the time of shipment or delivery of the product. Revenue from the sale of our associated products is recognized when the following criteria are met: (1) Persuasive evidence of an arrangement between us and our client exists; (2) Shipment has occurred; (3) The price is fixed and/or determinable; and (4) Collectability is reasonably assured or probable. The combination of hardware and software included in our Enhanced Table Systems and e-Tables is essential to the operation of the respective systems. As such, we do not segregate the portion of revenue between manufactured equipment and any software or electronic devices needed to use the equipment when the system is provided. We do not market the software separately from the equipment. |
Costs of ancillary products and assembled components | Costs of ancillary products and assembled components. Ancillary products include paytables (display of payouts), bases, layouts, signage and other items as they relate to support specific proprietary games in connection with the licensing of our games. Assembled components represent the cost of the equipment, devices and incorporated software used to support the Bonus Jackpot System and SpectrumVision . |
Research and development | Research and development. We incur research and development (“R&D”) costs to develop our new and next-generation products. Our products reach commercial feasibility shortly before the products are released and therefore R&D costs are expensed as incurred. Employee-related costs associated with product development are included in R&D costs. |
Foreign currency translation | Foreign currency translation. For non-US functional accounts, assets and liabilities are translated at exchange rates in effect at the balance sheet date, and income and expense accounts at the average exchange rates for the year. Resulting currency translation adjustments are recorded as a separate component of shareholders’ equity. We record foreign currency transactions at the exchange rate prevailing at the date of the transaction with resultant gains and losses being included in results of operations. Realized foreign currency transaction gains and losses have not been significant for any period presented. |
Income taxes | Income taxes. We use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carry-forwards. These temporary differences will result in deductible or taxable amounts in future years when the reported amounts of the assets or liabilities are recovered or settled. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some or all of the deferred tax assets may not be realized. Adjustments to the valuation allowance increase or decrease our income tax provision or benefit. We follow the provisions contained in Accounting Standards Codification (“ASC”) Topic 740, Income Taxes. We recognize the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. Judgment is required in determining the provision for incomes taxes and related accruals, deferred tax assets and liabilities. In the ordinary course of business, there are transactions and calculations where the ultimate tax outcome is uncertain. Additionally, our tax returns are subject to audit by various tax authorities. Although we believe that our estimates are reasonable, actual results could differ from these estimates |
Basic income (loss) per share | Basic income (loss) per share. Basic earnings per share is calculated by dividing net income by the weighted average number of common shares issued and outstanding during the year. Diluted earnings per share is similar to basic, except that the weighted average number of shares outstanding is increased by the potentially dilutive effect of outstanding stock options and warrants, if applicable, during the year, using the treasury stock method. |
Stock-based compensation | Stock-based compensation. We measure and recognize all stock-based compensation, including restricted stock and stock-based awards to employees, under the fair value method. We measure the fair value of stock-based awards using the Black-Scholes model and restricted shares using the grant date fair value of the stock. Compensation is attributed to the periods of associated service and such expense is recognized on a straight-line basis over the vesting period of the awards. Forfeitures are estimated at the time of grant, with such estimate updated when the expected forfeiture rate changes. |
Use of estimates and assumptions | Use of estimates and assumptions. We are required to make estimates, judgments and assumptions that we believe are reasonable based on our historical experience, contract terms, observance of known trends in our company and the industry as a whole, and information available from other outside sources. Our estimates affect reported amounts for assets, liabilities, revenues, expenses and related disclosures. Actual results may differ from initial estimates. |
Reclassifications | Reclassifications. Certain accounts and financial statement captions in the prior periods have been reclassified to conform to the current period financial statements. |
Recently adopted accounting standards - not adopted | Recently adopted accounting standards – not adopted We believe there is no additional new accounting guidance adopted, but not yet effective, which is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on its financial reporting. |
SIGNIFICANT ACCOUNTING POLICI26
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Finite Lived Intangible Assets Useful Lives | Material assets added over the past several years are as follows: Client installation base 60 months Licensing agreements 60 months Patents 87 - 132 months Trademarks 144 - 360 months Client relationships 264 months |
Schedule of Client Revenue Concentrations | For the six months ended June 30, 2015 and 2014, we had the following client revenue concentrations: Location 2015 Revenue 2014 Revenue Client A North America 15.1% 15.3% Client B United Kingdom 6.7% 8.3% Client C North America 5.4% 4.9% Client D North America 5.1% 3.9% |
NOTE RECEIVABLE - RELATED PAR27
NOTE RECEIVABLE - RELATED PARTY (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Receivables [Abstract] | |
Schedule of Related Party Note Receivable | The note receivable balance was as follows: June 30, 2015 December 2014 Note receivable $ 383,298 $ 383,298 Less: current portion (383,298 ) (383,298 ) Long-term note receivable $ — $ — |
PREPAID EXPENSES (Tables)
PREPAID EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Prepaid Expense And Other Assets [Abstract] | |
Schedule of Prepaid Expenses | Prepaid expenses consisted of the following at: June 30, 2015 December 2014 Compliance $ 62,556 $ - IT systems 39,385 9,304 Travel 25,109 8,587 Trade show expense 22,999 7,000 Dues & subscriptions 21,474 14,562 Insurance 18,131 16,612 Professional services 6,287 21,863 Rent 1,989 1,989 Other prepaid expenses 370 523 Prepaid expenses $ 198,300 $ 80,440 |
INVENTORY (Tables)
INVENTORY (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consisted of the following at: June 30, 2015 December 2014 Raw materials and component parts $ 101,775 $ 111,246 Finished goods 74,993 96,254 Work-in-process 53,266 69,464 230,034 276,964 Less: inventory reserve (35,000 ) (44,175 ) Inventory $ 195,034 $ 232,789 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Plant Equipment | Property and equipment, recorded at cost, consisted of the following at: June 30, 2015 December 31, 2014 Leasehold improvements $ 156,843 $ 150,000 Furniture and fixtures 211,411 197,751 Computer equipment 87,631 84,186 Automotive vehicles 94,087 86,364 Office equipment 29,140 17,403 579,112 535,704 Less: accumulated depreciation (215,063 ) (153,606 ) Property and equipment, net $ 364,049 $ 382,098 |
PRODUCTS LEASED AND HELD FOR 31
PRODUCTS LEASED AND HELD FOR LEASE (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Leases Operating [Abstract] | |
Schedule of Products Leased and Held for Lease | Products leased and held for lease consisted of the following at: June 30, 2015 December 2014 Enhanced table systems $ 244,530 $ 233,496 Less: accumulated depreciation (128,216 ) (107,831 ) Products leased and held for lease, net $ 116,314 $ 125,665 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Schedule of Intellectual Property and Intangible Assets | Intellectual property and intangible assets consisted of the following at: June 30, 2015 December 2014 Patents $ 13,615,967 $ 13,615,967 Customer relationships 3,400,000 3,400,000 Trademarks 2,740,000 2,740,000 Non-compete agreements 660,000 660,000 Licensing agreements 35,000 35,000 20,450,967 20,450,967 Less: accumulated amortization (6,444,705 ) (5,694,319 ) Intangible assets, net $ 14,006,262 $ 14,756,648 |
Finite Lived Intangible Assets Useful Lives | Material assets added over the past several years are as follows: Client installation base 60 months Licensing agreements 60 months Patents 87 - 132 months Trademarks 144 - 360 months Client relationships 264 months |
Prime Table Games | |
Finite Lived Intangible Assets Useful Lives | In October 2011, we acquired the following intangible assets related to the asset purchase with Prime Table Games LLC and Prime Table Games UK (collectively “Prime Table Games”): Fair Value Patents $ 13,259,000 Customer relationships 3,400,000 Trademarks 2,740,000 Goodwill 1,091,000 Non-compete agreement 660,000 Total acquired intangible assets $ 21,150,000 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses, consisted of the following at: June 30, 2015 December 2014 Royalties $ 138,570 $ 59,715 Salaries & payroll taxes 68,599 70,262 TableMAX reimbursement 77,346 72,636 Vacation 68,418 58,642 Commissions 51,405 148,902 Trade show expenses 89,424 41,666 Professional fees 31,633 60,779 Accrued interest 3,645 3,686 Other accrued expenses 1,827 2,878 Accrued expenses $ 530,867 $ 519,166 |
CAPITAL LEASE OBLIGATIONS (Tabl
CAPITAL LEASE OBLIGATIONS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Leases [Abstract] | |
Schedule of Capital Lease Obligations | Capital lease obligations consisted of the following at: June 30, 2015 December 2014 Capital lease obligation – leasehold improvements $ 121,450 $ 135,171 Capital lease obligation – office furniture 49,563 68,306 171,013 203,477 Less: Current portion (69,041 ) (66,273 ) Capital lease obligations $ 101,972 $ 137,204 |
Schedule of Future Minimum Lease Payments | The capital leases cover furniture and leasehold improvements located at our corporate headquarters in Las Vegas, Nevada. Annual requirements for capital leases obligations are as follows: June 30, Total 2016 $ 78,237 2017 43,769 2018 34,545 2019 31,666 Total minimum lease payments $ 188,217 Less: amount representing interest (17,204 ) Present value of net minimum lease payments $ 171,013 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable consisted of the following at: June 30, 2015 December 2014 Notes payable, net of debt discount - PTG $ 12,865,893 $ 14,385,643 Note payable – related party 1,049,442 1,065,324 Vehicles, notes payable 78,604 86,364 13,993,939 15,537,331 Less: Current portion (3,850,472 ) (3,480,864 ) Total long-term debt $ 10,143,467 $ 12,056,467 |
Schedule of Maturities | Maturities of our notes payable are as follows: Maturities as of June 30, Total 2016 $ 3,850,412 2017 5,307,513 2018 4,563,279 2019 1,010,783 2020 9,582 Total notes payable $ 14,741,569 Less: debt discount (747,630 ) Notes payable, net of debt discount $ 13,993,939 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Estimates of Lease Obligations | Future minimum lease payments are as follows: Twelve Months Ended June 30, Annual Obligation 2016 $ 218,304 2017 227,052 2018 235,788 2019 244,524 2020 2,802 Total Estimated Lease Obligations $ 928,470 |
STOCK OPTIONS AND WARRANTS (Tab
STOCK OPTIONS AND WARRANTS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Warrant Activity | A summary of current warrant activity is as follows: Common Weighted Average Exercise Price Outstanding – January 1, 2014 616,667 $ 0.56 Issued — — Exercised — — Expired (616,667 ) 0.56 Outstanding – December 31, 2014 — — Issued — — Exercised — — Expired — — Outstanding – June 30, 2015 — $ — Exercisable – June 30, 2015 — $ — |
Summary of Stock Options Pricing | Options Issued Six Months Ended June 30, 2015 Dividend yield 0 % Expected volatility 85 % Risk free interest rate 1.63 % Expected life (years) 5.00 |
Summary of Stock Option Activity | A summary of stock option activity is as follows: Common Weighted Average Exercise Price Outstanding – January 1, 2014 100,000 $ 0.25 Issued 281,250 0.41 Exercised — — Expired — — Outstanding – December 31, 2014 381,250 $ 0.41 Issued 300,000 0.26 Exercised — — Expired — — Outstanding – June 30, 2015 681,250 $ 0.32 Exercisable – June 30, 2015 592,361 $ 0.32 |
ASSET ACQUISITIONS AND SIGNIF38
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Schedule of Acquisition Date Fair Value Consideration Transferred | The acquisition-date fair value of the consideration transferred consisted of the following items: Common stock – 2,000,000 shares $ 480,000 Note payable – Prime Table Games LLC 12,200,000 Note payable – Prime Table Games UK 10,000,000 Total $ 22,680,000 |
Schedule of Asset Acquisition Allocation | The allocation of the total purchase price to the net assets acquired is as follows: Patents $ 13,259,000 Customer relationships 3,400,000 Trademarks 2,740,000 Debt discount 1,530,000 Goodwill 1,091,000 Non-compete agreement 660,000 Total purchase price allocation $ 22,680,000 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details Narrative) - Jun. 30, 2015 | TableGameCasino |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of table games | 4,000 |
Number of casinos | Casino | 500 |
SIGNIFICANT ACCOUNTING POLICI40
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Product Information [Line Items] | ||
Goodwill | $ 1,091,000 | $ 1,091,000 |
Leasehold Improvements | 150,000 | |
Patents | Credit Concentration Risk | ||
Product Information [Line Items] | ||
Accounts receivable from client account | $ 2,845,545 | |
Patents | Credit Concentration Risk | Revenue | ||
Product Information [Line Items] | ||
Concentration risk percentage | 54.00% | |
PTG | ||
Product Information [Line Items] | ||
Goodwill | $ 1,091,000 | |
Maximum | ||
Product Information [Line Items] | ||
Cash, FDIC Insured Amount | $ 250,000 | |
Property plant and equipment useful life | 5 years | |
Finite lived intangible assets useful life | 30 years | |
Maximum | Patents | ||
Product Information [Line Items] | ||
Finite lived intangible assets useful life | 132 months | |
Minimum | ||
Product Information [Line Items] | ||
Property plant and equipment useful life | 3 years | |
Finite lived intangible assets useful life | 5 years | |
Minimum | Patents | ||
Product Information [Line Items] | ||
Finite lived intangible assets useful life | 87 months |
SIGNIFICANT ACCOUNTING POLICI41
SIGNIFICANT ACCOUNTING POLICIES - Finite Lived Intangible Assets Useful Lives (Details) | 6 Months Ended |
Jun. 30, 2015 | |
Minimum | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 5 years |
Maximum | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 30 years |
Client installation base | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 60 months |
Licensing agreements | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 60 months |
Patents | Minimum | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 87 months |
Patents | Maximum | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 132 months |
Trademarks | Minimum | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 144 months |
Trademarks | Maximum | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 360 months |
Client relationships | |
Finite Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 264 months |
SIGNIFICANT ACCOUNTING POLICI42
SIGNIFICANT ACCOUNTING POLICIES - Schedule of Client Revenue Concentrations (Details) - Customer Concentration Risk - Revenue | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Client A | North America | ||
Product Information [Line Items] | ||
Concentration Risk | 15.10% | 15.30% |
Client B | United Kingdom | ||
Product Information [Line Items] | ||
Concentration Risk | 6.70% | 8.30% |
Client C | North America | ||
Product Information [Line Items] | ||
Concentration Risk | 5.40% | 4.90% |
Client D | North America | ||
Product Information [Line Items] | ||
Concentration Risk | 5.10% | 3.90% |
NOTE RECEIVABLE - Schedule of R
NOTE RECEIVABLE - Schedule of Related Party Note Receivable (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Related Party Transaction [Line Items] | ||
Less: current portion | $ (383,298) | $ (383,298) |
Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Note receivable | 383,298 | 383,298 |
Less: current portion | $ (383,298) | $ (383,298) |
NOTE RECEIVABLE - RELATED PAR44
NOTE RECEIVABLE - RELATED PARTY (Details Narrative) - Affiliated Entity - USD ($) | Sep. 30, 2010 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 |
Related Party Transaction [Line Items] | ||||
Fixed interest rate | 6.00% | |||
Monthly principal and interest payments | $ 3,332 | $ 6,598 | ||
Unpaid principal and interest due | Feb. 1, 2017 | |||
Notes receivable, maturity period | 10 years | |||
Interest income | $ 11,523 | $ 11,145 | ||
Interest receivable | $ 52,095 | |||
Principal and interest collectible, notes receivable | 100.00% | 100.00% | ||
Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Fixed interest rate | 6.00% | |||
Interest income | $ 11,523 | $ 11,145 |
PREPAID EXPENSES - Schedule of
PREPAID EXPENSES - Schedule of Prepaid Expenses (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Prepaid Expense Current [Abstract] | ||
Compliance | $ 62,556 | |
IT systems | 39,385 | $ 9,304 |
Travel | 25,109 | 8,587 |
Trade show expense | 22,999 | 7,000 |
Dues & subscriptions | 21,474 | 14,562 |
Insurance | 18,131 | 16,612 |
Professional services | 6,287 | 21,863 |
Rent | 1,989 | 1,989 |
Other prepaid expenses | 370 | 523 |
Total prepaid expenses | $ 198,300 | $ 80,440 |
INVENTORY - Schedule of Invento
INVENTORY - Schedule of Inventory (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Raw materials and component parts | $ 101,775 | $ 111,246 |
Finished goods | 74,993 | 96,254 |
Work-in-process | 53,266 | 69,464 |
Subtotal | 230,034 | 276,964 |
Less: inventory reserve | (35,000) | (44,175) |
Inventory | $ 195,034 | $ 232,789 |
PROPERTY AND EQUIPMENT - Schedu
PROPERTY AND EQUIPMENT - Schedule of Property and Plant Equipment (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 156,843 | $ 150,000 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 211,411 | 197,751 |
Computer Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 87,631 | 84,186 |
Automotive Vehicles | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 94,087 | 86,364 |
Office Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 29,140 | 17,403 |
Property Plant and Equipment Excluding Assets Leased to Others | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 579,112 | 535,704 |
Less: accumulated depreciation | (215,063) | (153,606) |
Property and equipment, net | $ 364,049 | $ 382,098 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Property Plant And Equipment [Line Items] | ||||
Depreciation expense | $ 43,018 | $ 28,451 | $ 84,311 | $ 42,744 |
Capital Lease Assets | 243,970 | 243,970 | ||
Capital Lease Assets, Accumulated depreciation | $ 73,631 | 73,631 | ||
Property Plant and Equipment Excluding Assets Leased to Others | ||||
Property Plant And Equipment [Line Items] | ||||
Depreciation expense | $ 62,115 | $ 24,926 |
PRODUCTS LEASED AND HELD FOR 49
PRODUCTS LEASED AND HELD FOR LEASE - Schedule of Products Leased and Held for Lease (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Leases Operating [Abstract] | ||
Enhanced table systems | $ 244,530 | $ 233,496 |
Less: accumulated depreciation | (128,216) | (107,831) |
Products leased and held for lease, net | $ 116,314 | $ 125,665 |
PRODUCTS LEASED AND HELD FOR 50
PRODUCTS LEASED AND HELD FOR LEASE (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Leases Operating [Abstract] | ||
Products leased and held for lease, Depreciation | $ 20,385 | $ 16,008 |
INTANGIBLE ASSETS - Schedule of
INTANGIBLE ASSETS - Schedule of Intellectual Property and Intangible Assets (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Intangible assets | $ 20,450,967 | $ 20,450,967 |
Less: accumulated amortization | (6,444,705) | (5,694,319) |
Intangible assets, net | 14,006,262 | 14,756,648 |
Patents | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Intangible assets | 13,615,967 | 13,615,967 |
Intangible assets, net | 0 | |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Intangible assets | 3,400,000 | 3,400,000 |
Trademarks | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Intangible assets | 2,740,000 | 2,740,000 |
Non-compete Agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Intangible assets | 660,000 | 660,000 |
Licensing agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Intangible assets | $ 35,000 | $ 35,000 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 372,313 | $ 389,634 | $ 750,386 | $ 779,133 |
INTANGIBLE ASSETS - Schedule 53
INTANGIBLE ASSETS - Schedule of Intangible Assets of Prime Table Games (Details) - Prime Table Games Acquisition | Oct. 31, 2011USD ($) |
Finite Lived Intangible Assets [Line Items] | |
Patents | $ 13,259,000 |
Customer relationships | 3,400,000 |
Trademarks | 2,740,000 |
Goodwill | 1,091,000 |
Non-compete agreement | 660,000 |
Total acquired intangible assets | $ 21,150,000 |
ACCRUED EXPENSES - Schedule of
ACCRUED EXPENSES - Schedule of Accrued Expenses (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Payables And Accruals [Abstract] | ||
Royalties | $ 138,570 | $ 59,715 |
Salaries & payroll taxes | 68,599 | 70,262 |
TableMAX reimbursement | 77,346 | 72,636 |
Vacation | 68,418 | 58,642 |
Commissions | 51,405 | 148,902 |
Trade show expenses | 89,424 | 41,666 |
Professional fees | 31,633 | 60,779 |
Accrued interest | 3,645 | 3,686 |
Other accrued expenses | 1,827 | 2,878 |
Accrued expenses | $ 530,867 | $ 519,166 |
CAPITAL LEASE OBLIGATIONS - Sch
CAPITAL LEASE OBLIGATIONS - Schedule of Capital Lease Obligations (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Capital Lease Obligation [Line Items] | ||
Capital lease obligation | $ 171,013 | $ 203,477 |
Less: Current portion | (69,041) | (66,273) |
Capital lease obligations, net of current portion | 101,972 | 137,204 |
Leasehold Improvements | ||
Capital Lease Obligation [Line Items] | ||
Capital lease obligation | 121,450 | 135,171 |
Office Furniture | ||
Capital Lease Obligation [Line Items] | ||
Capital lease obligation | $ 49,563 | $ 68,306 |
CAPITAL LEASE OBLIGATIONS (Deta
CAPITAL LEASE OBLIGATIONS (Details Narrative) - Jun. 30, 2015 - USD ($) | Total |
Capital Lease Obligation [Line Items] | |
Capital leases, frequency of periodic payment | monthly |
Leasehold Improvements | |
Capital Lease Obligation [Line Items] | |
Interest rate | 5.50% |
Office Furniture | |
Capital Lease Obligation [Line Items] | |
Interest rate | 10.20% |
Capital Lease Obligations | Leasehold Improvements | |
Capital Lease Obligation [Line Items] | |
Capital leases, monthly payment | $ 2,879 |
Capital leases, frequency of periodic payment | Monthly |
Capital leases, term | 60 months |
Capital Lease Obligations | Office Furniture | |
Capital Lease Obligation [Line Items] | |
Capital leases, monthly payment | $ 3,641 |
Capital leases, frequency of periodic payment | Monthly |
Capital leases, term | 30 months |
CAPITAL LEASE OBLIGATIONS - S57
CAPITAL LEASE OBLIGATIONS - Schedule of Future Minimum Lease Payments (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Leases [Abstract] | ||
2,016 | $ 78,237 | |
2,017 | 43,769 | |
2,018 | 34,545 | |
2,019 | 31,666 | |
Total minimum lease payments | 188,217 | |
Less: amount representing interest | (17,204) | |
Present value of net minimum lease payments | $ 171,013 | $ 203,477 |
NOTES PAYABLE - Schedule of Not
NOTES PAYABLE - Schedule of Notes Payable (Details) - Related Party - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Total Note Payable | $ 13,993,939 | $ 15,537,331 |
Less: Current portion | (3,850,472) | (3,480,864) |
Total long-term debt | 10,143,467 | 12,056,467 |
PTG | ||
Debt Instrument [Line Items] | ||
Total Note Payable | 12,865,893 | 14,385,643 |
Total Note Payable | 1,049,442 | 1,065,324 |
Automotive Vehicles | ||
Debt Instrument [Line Items] | ||
Total Note Payable | $ 78,604 | $ 86,364 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) £ in Millions | Oct. 31, 2011USD ($) | Oct. 31, 2011GBP (£) | Jun. 30, 2015USD ($) |
Debt Instrument [Line Items] | |||
Note payable, frequency of periodic payment | monthly | ||
Promissory note payable, total | $ 22,680,000 | ||
Acquired promissory notes | $ 22,200,000 | ||
Prime Table Games UK and LLC | |||
Debt Instrument [Line Items] | |||
Promissory note payable, total | 23,000,000 | ||
Fair value of the notes payable | 1,530,000 | ||
Notes Payable | Prime Table Games LLC | |||
Debt Instrument [Line Items] | |||
Monthly principal and interest payments | $ 9,159 | ||
Fixed interest rate | 7.30% | ||
Balloon payment | $ 1,003,000 | ||
Promissory note payable | 12,200,000 | 12,200,000 | |
Notes Payable | Prime Table Games UK | |||
Debt Instrument [Line Items] | |||
Promissory note payable | $ 10,000,000 | £ 6.4 | $ 10,000,000 |
NOTES PAYABLE - Schedule of Mat
NOTES PAYABLE - Schedule of Maturities (Details) - Promissory Note | Jun. 30, 2015USD ($) |
Debt Instrument [Line Items] | |
2,016 | $ 3,850,412 |
2,017 | 5,307,513 |
2,018 | 4,563,279 |
2,019 | 1,010,783 |
2,020 | 9,582 |
Total notes payable | 14,741,569 |
Less: debt discount | (747,630) |
Notes payable, net of debt discount | $ 13,993,939 |
COMMITMENTS AND CONTINGENCIES61
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 1 Months Ended | 6 Months Ended | |
Feb. 28, 2014ft² | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | |
Commitments And Contingencies [Line Items] | |||
Rent expense | $ 145,448 | $ 127,685 | |
Spencer Lease | |||
Commitments And Contingencies [Line Items] | |||
Rental term | 5 years | ||
Rent expense | $ 153,000 | ||
Annual rental increase | 4.00% | ||
Tenant Improvement Allowance Option | $ 150,000 | ||
Interest rate | 5.50% | ||
Spencer Lease | Office | |||
Commitments And Contingencies [Line Items] | |||
Area of building | ft² | 16,000 | ||
Spencer Lease | Warehouse | |||
Commitments And Contingencies [Line Items] | |||
Area of building | ft² | 8,000 | ||
Spencer Lease | Building | |||
Commitments And Contingencies [Line Items] | |||
Area of building | ft² | 24,000 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Schedule of Estimates of Lease Obligations (Details) | Jun. 30, 2015USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,016 | $ 218,304 |
2,017 | 227,052 |
2,018 | 235,788 |
2,019 | 244,524 |
2,020 | 2,802 |
Total Estimated Lease Obligations | $ 928,470 |
STOCKHOLDERS EQUITY (Details Na
STOCKHOLDERS EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Apr. 30, 2015 | May. 31, 2014 | Mar. 31, 2014 | Feb. 28, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | Jan. 01, 2015 | |
Temporary Equity [Line Items] | ||||||||
Common Stock, Shares authorized | 65,000,000 | 65,000,000 | ||||||
Common Stock, par value | $ 0.001 | $ 0.001 | ||||||
Preferred Stock, Shares authorized | 10,000,000 | 10,000,000 | ||||||
Preferred Stock, Par Value | $ 0.001 | $ 0.001 | ||||||
Fair market value of shares granted | $ 48,027 | $ 30,672 | ||||||
Common Stock, Issued | 39,065,591 | 38,990,591 | ||||||
Common Stock, Outstanding | 39,065,591 | 38,990,591 | ||||||
Preferred Stock, Issued | 0 | 0 | ||||||
Preferred Stock, Outstanding | 0 | 0 | ||||||
Employee Stock Option | ||||||||
Temporary Equity [Line Items] | ||||||||
Issuance of restricted stock, shares | 255,000 | |||||||
Fair market value of shares granted | $ 102,000 | |||||||
Performance Shares | ||||||||
Temporary Equity [Line Items] | ||||||||
Issuance of restricted stock, shares | 100,000 | |||||||
Fair market value of shares granted | $ 40,000 | |||||||
Contractor | ||||||||
Temporary Equity [Line Items] | ||||||||
Issuance of restricted stock, shares | 150,000 | |||||||
Common stock, shares vested | 75,000 | 75,000 | ||||||
Related Party | ||||||||
Temporary Equity [Line Items] | ||||||||
Issuance of restricted stock, shares | 75,000 | 75,000 | 100,000 | |||||
Common stock, shares vested | 75,000 | 75,000 | 100,000 | |||||
Fair market value of shares granted | $ 22,500 | $ 35,250 | $ 28,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Sep. 30, 2010 | Jun. 30, 2015 | Jun. 30, 2014 | Apr. 30, 2014 | Dec. 31, 2014 |
Related Party Transaction [Line Items] | |||||
Lease agreement effective date | Sep. 1, 2010 | ||||
Lease expiration date | Aug. 31, 2012 | ||||
Affiliated Entity | |||||
Related Party Transaction [Line Items] | |||||
Capital leases, monthly payment | $ 0 | $ 37,296 | |||
Fixed interest rate | 6.00% | ||||
Monthly principal and interest payments | $ 3,332 | $ 6,598 | |||
Unpaid principal and interest due | Feb. 1, 2017 | ||||
Interest income | $ 11,523 | $ 11,145 | |||
Note receivable, balance | $ 383,298 | $ 383,298 | |||
Affiliated Entity | Notes Payable | |||||
Related Party Transaction [Line Items] | |||||
Fixed interest rate | 7.30% | ||||
Monthly principal and interest payments | $ 9,159 | ||||
Unpaid principal and interest due | Feb. 1, 2017 | ||||
Note payable, balance | $ 1,049,442 | $ 1,065,324 | |||
Balloon payment | $ 1,003,000 | ||||
Affiliated Entity | Offices | |||||
Related Party Transaction [Line Items] | |||||
Monthly rental payment | $ 10,360 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Contingency [Line Items] | ||
Effective tax rate | 45.50% | |
Increase effective income tax rate | 1.80% | |
Plan | ||
Income Tax Contingency [Line Items] | ||
Effective tax rate | 47.30% |
STOCK OPTIONS AND WARRANTS - Su
STOCK OPTIONS AND WARRANTS - Summary of Warrant Activity (Details) - 12 months ended Dec. 31, 2014 - Common Stock - $ / shares | Total |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Warrants Expired, number of shares | (616,667) |
Warrants Expired, weighted average exercise price | $ 0.56 |
STOCK OPTIONS AND WARRANTS (Det
STOCK OPTIONS AND WARRANTS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock Options Issued | 300,000 | 114,583 | ||
Fair market value of shares granted | $ 48,027 | $ 30,672 | ||
Share-based compensation | $ 36,072 | $ 67,136 | $ 54,942 | $ 114,823 |
Director | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock Options Issued | 125,000 | 58,333 | ||
Contractor | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock Options Issued | 75,000 | 56,250 | ||
Employee | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock Options Issued | 100,000 | |||
Stock options vesting period | 3 years |
STOCK OPTIONS AND WARRANTS - 68
STOCK OPTIONS AND WARRANTS - Summary of Stock Options Pricing (Details) - 6 months ended Jun. 30, 2015 - Stock Option | Total |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Dividend yield | 0.00% |
Expected volatility | 85.00% |
Risk free interest rate | 1.63% |
Expected life (years) | 5 years |
STOCK OPTIONS AND WARRANTS - 69
STOCK OPTIONS AND WARRANTS - Summary of Stock Option Activity (Details) - $ / shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Issued, number of shares | 300,000 | 114,583 | |
Common Stock | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Beginning Balance, number of shares | 381,250 | ||
Options Issued, number of shares | 300,000 | 281,250 | |
Ending Balance, number of shares | 681,250 | 381,250 | |
Ending Balance, Options Exercisable | 592,361 | ||
Beginning Balance, weighted average exercise price | $ 0.41 | ||
Options Issued, weighted average exercise price | 0.26 | $ 0.41 | |
Ending Balance, weighted average exercise price | 0.32 | $ 0.41 | |
Ending Balance, Options Exercisable, weighted average exercise price | $ 0.32 |
ASSET ACQUISITIONS AND SIGNIF70
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS (Details Narrative) | 12 Months Ended | ||
Dec. 31, 2014USD ($) | Jun. 30, 2015USD ($)TableGameCasino | Oct. 31, 2011TableGameCasinoPatentTrademarkandRegistration | |
Business Acquisition [Line Items] | |||
Number of table games | TableGame | 4,000 | ||
Number of casinos | Casino | 500 | ||
Intangible assets, net | $ 14,756,648 | $ 14,006,262 | |
TMAX | |||
Business Acquisition [Line Items] | |||
TableMAX operating expense reimbursable | 72,636 | $ 77,346 | |
PTG | |||
Business Acquisition [Line Items] | |||
Number of table games | TableGame | 20 | ||
Number of casinos | Casino | 250 | ||
Patents | |||
Business Acquisition [Line Items] | |||
Intangible assets, net | 0 | ||
Impairment of intangible assets | $ 528,233 | ||
Patents | PTG | |||
Business Acquisition [Line Items] | |||
Number of intangible assets acquired | Patent | 36 | ||
Patents Pending | PTG | |||
Business Acquisition [Line Items] | |||
Number of intangible assets acquired | Patent | 11 | ||
Trademarks and Design Registrations | PTG | |||
Business Acquisition [Line Items] | |||
Number of intangible assets acquired | TrademarkandRegistration | 96 | ||
Domain Name Registrations | PTG | |||
Business Acquisition [Line Items] | |||
Number of intangible assets acquired | TrademarkandRegistration | 47 |
ASSET ACQUISITIONS AND SIGNIF71
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS - Schedule of Acquisition Date Fair Value Consideration Transferred (Details) £ in Millions | Oct. 31, 2011USD ($) | Oct. 31, 2011GBP (£) | Jun. 30, 2015USD ($) |
Business Acquisition [Line Items] | |||
Common stock – 2,000,000 shares | $ 480,000 | ||
Total | 22,680,000 | ||
Notes Payable | Prime Table Games LLC | |||
Business Acquisition [Line Items] | |||
Note payable | $ 12,200,000 | 12,200,000 | |
Notes Payable | Prime Table Games UK | |||
Business Acquisition [Line Items] | |||
Note payable | $ 10,000,000 | £ 6.4 | $ 10,000,000 |
ASSET ACQUISITIONS AND SIGNIF72
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS - Schedule of Acquisition Date Fair Value Consideration Transferred (Parenthetical) (Details) | 6 Months Ended |
Jun. 30, 2015shares | |
Business Combinations [Abstract] | |
Common stock shares issued | 2,000,000 |
ASSET ACQUISITIONS AND SIGNIF73
ASSET ACQUISITIONS AND SIGNIFICANT TRANSACTIONS - Schedule of Asset Acquisition Allocation (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||
Debt discount | $ 1,530,000 | |
Goodwill | 1,091,000 | $ 1,091,000 |
Total purchase price allocation | 22,680,000 | |
Patents | ||
Business Acquisition [Line Items] | ||
Intangible assets excluding goodwill | 13,259,000 | |
Client relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets excluding goodwill | 3,400,000 | |
Trademarks | ||
Business Acquisition [Line Items] | ||
Intangible assets excluding goodwill | 2,740,000 | |
Non-compete Agreements | ||
Business Acquisition [Line Items] | ||
Intangible assets excluding goodwill | $ 660,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2018 | |
Subsequent Event [Line Items] | ||
Related Party Transaction Date Month And Year | Aug. 10, 2015 | |
Carpathia Associates L L C | ||
Subsequent Event [Line Items] | ||
Outstanding note payable | $ 437,313 | |
Carpathia Associates L L C | Scenario Forecast | ||
Subsequent Event [Line Items] | ||
Balloon payment | $ 354,480 | |
Before Amendment | Carpathia Associates L L C | ||
Subsequent Event [Line Items] | ||
Debt Instrument Maturity Month And Year | 2017-02 | |
After Amendment | Carpathia Associates L L C | ||
Subsequent Event [Line Items] | ||
Debt Instrument Maturity Month And Year | 2018-12 |
Uncategorized Items - glxz-2015
Label | Element | Value |
Common Stock [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Number | us-gaap_ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber | 100,000 |
Class Of Warrant Or Right Exercise Price Of Warrants Or Rights1 | us-gaap_ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1 | $ 0.56 |
Class Of Warrant Or Right Outstanding | us-gaap_ClassOfWarrantOrRightOutstanding | 616,667 |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Weighted Average Exercise Price | us-gaap_ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice | $ 0.25 |