Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. GLOBAL PARI-MUTUEL SERVICES, INC. (1137417) 10-Q published on May 18, 2011 at 4:38 pm
Reporting Period: Mar 30, 2011
Stock Based Compensation - The Company applies Financial Accounting Standards Board (“FASB”) Accounting Standards Certification (“ASC”) Topic 718, “Compensation – Stock Compensation,” which requires companies to measure and recognize the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value. For non-employee stock based compensation, the Company recognizes an expense in accordance with FASB ASC Topic 505, “Equity,” and values the equity securities based on the fair value of the security on the date of grant. For stock-based awards, the value is based on the market value of the stock on the date of grant or the value of services, whichever is more readily available. Stock option awards are valued using the Black-Scholes option-pricing model.
On April 21, 2011, the Company, entered into a Share Purchase and Redemption Agreement (the “Platinum Agreement”) with Platinum Pari-Mutuel Group, a Nevada corporation (“Platinum”), and James A. Egide, the Company’s founder and former chief executive officer and director, pursuant to which the Company agreed to sell 100% of the outstanding capital stock of its wholly-owned subsidiaries, RTCN and RTCK (together, the “Royal Properties”), in exchange for an aggregate of 7,000,000 shares of the Company’s common stock held by the equity holders of Platinum, which shares will be redeemed and held in treasury by the Company (the “Sale”). In addition to Mr. Egide, certain former consultants and directors to the Company are equity holders of Platinum. The Sale is subject to customary closing conditions and closing conditions pertaining to certain intellectual property matters and the extension or termination of certain stock options.
On April 21, 2011, we entered into a Share Purchase and Redemption Agreement (the “Platinum Agreement”) with Platinum Pari-Mutuel Group, a Nevada corporation (“Platinum”), and James A. Egide, our founder and former chief executive officer and director, for certain limited purposes. Under the Platinum Agreement, we agreed to sell 100% of the outstanding capital stock of our wholly-owned subsidiaries, Royal Turf Club, Inc., a Nevada corporation (“RTCN”), and Royal Turf Club Limited, a St. Kitts and Nevis entity (“RTCK”), in exchange for an aggregate of 7,000,000 shares of our common stock held by the equity holders of Platinum, which shares will be redeemed and held in treasury by us (the “Sale”). In addition to Mr. Egide, certain of our former consultants and directors are equity holders of Platinum. The Sale is subject to customary closing conditions and closing conditions pertaining to certain intellectual property matters and the extension or termination of certain stock options.
Pursuant to the Platinum Agreement, we agreed to sell 100% of the outstanding capital stock of RTCN and RTCK in order to focus our resources exclusively on the development of new proprietary technology to expand our pari-mutuel platform to the financial services industry through the development and commercialization of our new product. As a result of the Platinum Agreement, all our operations listed below (see (a) to (f) below) are reflected as discontinued operations in the unaudited condensed consolidated financial statements as of March 31, 2011 and December 31, 2010 and for the three months ended March 31, 2011 and 2010. Consequently, a comparison of the operating results for the three months ended March 31, 2011 to the operating results for the three months ended March 31, 2010 is not meaningful. We had previously planned to obtain revenue from our pari-mutuel operations in any of the six following ways: (a) settlement and reconciliation services for pari-mutuel wagerers, (b) sub-licensing of our contracts with race tracks to simulcast facilities and physical off-track-betting parlors (“OTBs”), (c) wagering through our call center at race tracks with which we have contracts, (d) resale and rental of equipment and software required by operations of physical and virtual OTBs, (e) launching of an online internet model that allows international players to place wages on U.S. and international tracks through our www.rtcsportofkings.com website and the www.trackplayer.com website and (f) operating, through our hub in Antigua, an online pari-mutuel based instant racing and wagering system. We had been generating revenue from our pari-mutuel operations in all of our planned operations (see (a) to (e) above) except those from the operation of an online pari-mutuel based instant racing and wagering system (see (f) above). Upon the closing of the Platinum Agreement, we will become a development stage company.
General and administrative expenses were approximately $1,767,000 during the three months ended March 31, 2011. $750,000 of these costs were for payments made to Bendigo Partners LLC (“Bendigo”) under the consulting agreement, dated as of December 7, 2010, by and between Global and Bendigo, which expires on November 30, 2011. Approximately $900,000 of these costs were to professional advisors for services to us, including services related to our status as a public reporting company, providing opinions regarding U.S. and international regulations surrounding the new products that we are currently developing and routine corporate advice. The remaining expenses of approximately $117,000 were related to general Company expenses. We anticipate that these expenses will continue in the short term as we continue to develop our new product.