x
|
ANNUAL
REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the fiscal year ended December
31, 2006
|
o
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the transition period from ____________ to
____________
|
Commission
file number 000-28399
|
Gaming
& Entertainment Group, Inc.
|
||||||||
(Name
of small business issuer in its
charter)
|
Utah
|
59-1643698
|
|||||||
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
4501
Hayvenhurst Ave., Encino, CA 91436
|
91436
|
|||||||
(Address
of principal executive offices)
|
(Zip
Code)
|
Issuer’s
telephone number: (818)
400-5930
|
||||||||
Securities
registered pursuant to Section 12(b) of the
Act:
|
Title
of each class
|
Name
of each exchange on which registered
|
|||||||
Securities
registered pursuant to Section 12(g) of the
Act:
|
Common
Stock, $.01 par value
|
||||||||
(Title
of each class)
|
Check
whether the issuer (1) filed all reports required to be filed by
Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12
months (or for such shorter period that the registrant was required
to
file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes x No
o
|
Check
if there is no disclosure of delinquent filers in response to Item
405 of
Regulation S-K is not contained in this form, and no disclosure will
be
contained, to the best of the registrant’s knowledge, in definitive proxy
or information statements incorporated by reference in Part III of
this
Form 10-KSB or any amendment to this Form 10-KSB. x
|
State
issuer’s revenues for its most recent fiscal year: $140,826
|
Indicate
by check mark whether the registrant is a shell company (as defined
in
Rule 12b-2 of the Exchange Act).
Yes
o No
x
State
the aggregate market value of the voting and non-voting common equity
held
by non-affiliates computed by reference to the price at which the
common
equity was last sold, or the average bid and asked price of such
common
equity, as of a specified date within the past 60 days: $521,273
($0.045
per share as of March 9, 2007).
|
State
the number of shares outstanding of each of the issuer’s classes of common
equity, as of the latest practicable date: Common Stock, $.01 par
value,
19,830,602 shares (as of March 9, 2007).
|
||||||||
DOCUMENTS
INCORPORATED BY REFERENCE
|
||||||||
None.
|
PART
I
|
|
|
ITEM
1.
|
DESCRIPTION
OF BUSINESS
|
3
|
ITEM
2.
|
DESCRIPTION
OF PROPERTY
|
6
|
ITEM
3.
|
LEGAL
PROCEEDINGS
|
6
|
ITEM
4.
|
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
|
6
|
PART
II
|
6
|
|
ITEM
5.
|
MARKET
FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS
|
6
|
ITEM
6.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
|
8
|
ITEM
7.
|
FINANCIAL
STATEMENTS
|
F-1
|
ITEM
8.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.
|
21
|
ITEM
8A.
|
CONTROLS
AND PROCEDURES
|
21
|
PART
III
|
21
|
|
ITEM
9.
|
DIRECTORS,
EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
SECTION
16(a) OF THE EXCHANGE ACT
|
21
|
ITEM
10.
|
EXECUTIVE
COMPENSATION
|
23
|
ITEM
11.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
24
|
ITEM
12.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
|
27
|
ITEM
13.
|
EXHIBITS
|
30
|
ITEM
14.
|
PRINCIPAL
ACCOUNTANT FEES AND SERVICES
|
30
|
SIGNATURES
|
31
|
|
EXHIBIT
INDEX
|
32
|
ITEM 1. |
DESCRIPTION
OF BUSINESS.
|
· |
Commercialization
and licensing of our AWP and Section 16 games in the United Kingdom
|
ITEM 2. |
DESCRIPTION
OF
PROPERTY.
|
ITEM 3. |
LEGAL
PROCEEDINGS.
|
ITEM 4. |
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS.
|
ITEM 5. |
MARKET
FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS.
|
Calendar
Quarter Ended
|
Low
|
High
|
|||||
March
31, 2004
|
$
|
0.75
|
$
|
1.75
|
|||
June
30, 2004
|
$
|
0.67
|
$
|
1.30
|
|||
September
30, 2004
|
$
|
0.42
|
$
|
0.90
|
|||
December
31, 2004
|
$
|
0.28
|
$
|
0.60
|
|||
March
31, 2005
|
$
|
0.35
|
$
|
0.51
|
|||
June
30, 2005
|
$
|
0.21
|
$
|
0.45
|
|||
September
30, 2005
|
$
|
0.13
|
$
|
0.29
|
|||
December
31, 2005
|
$
|
0.13
|
$
|
0.23
|
|||
March
31, 2006
|
$
|
0.13
|
$
|
0.46
|
|||
June
30, 2006
|
$
|
0.15
|
$
|
0.42
|
|||
September
30, 2006
|
$
|
0.11
|
$
|
0.20
|
|||
December
31, 2006
|
$
|
0.03
|
$
|
0.20
|
|||
March
31, 2007 (through March 9, 2007)
|
$
|
0.03
|
$
|
0.05
|
ITEM 6. |
MANAGEMENT’S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
|
· |
Having
a price of less than $5.00 per
share
|
· |
Not
traded on a “recognized” national
exchange
|
· |
Not
quoted on the Nasdaq automated quotation system (Nasdaq-listed stock
must
still have a price of not less than $5.00 per share);
or
|
· |
Of
issuers with net tangible assets less than $2.0 million (if the issuer
has
been in continuous operation for at least three years) or $5.0 million
(if
in continuous operation for less than three years), or with average
revenues of less than $6.0 million for the last three
years.
|
ITEM 7. |
FINANCIAL
STATEMENTS.
|
Reports
of Independent Registered Public Accounting Firms
|
F-2/F-3
|
Consolidated
Balance Sheet
|
|
December
31, 2006
|
F-4
|
Consolidated
Statements of Operations
|
|
Years
Ended December 31, 2006 and 2005
|
F-5
|
Consolidated
Statements of Stockholders' Deficiency
|
|
Years
Ended December 2006 and 2005
|
F-6
|
Consolidated
Statements of Cash Flows
|
|
Years
Ended December 31, 2006 and 2005
|
F-7
|
Notes
to Consolidated Financial Statements
|
F-8
|
HANSEN,
BARNETT&
MAXWELL,
P.C.
|
|
A
Professional Corporation
|
|
CERTIFIED
PUBLIC ACCOUNTANTS
|
|
5
Triad Center, Suite 750
|
Registered
with the Public Company
|
Salt
Lake City, UT 84180-1128
|
Accounting
Oversight Board
|
Phone:
(801) 532-2200
|
|
Fax:
(801) 532-7944
|
|
www.hbmcpas.com
|
ASSETS
|
||||
Current
Assets
|
||||
Cash
|
$
|
73,367
|
||
Total
current assets
|
73,367
|
|||
Equipment
and Furnishings,
net of accumulated depreciation of $39,732
|
30,827
|
|||
Total
assets
|
$
|
104,194
|
||
LIABILITIES
AND STOCKHOLDERS’ DEFICIENCY
|
||||
Current
Liabilities
|
||||
Accounts
payable
|
$
|
103,230
|
||
Accrued
expenses
|
413,452
|
|||
Accrued
compensation - officers
|
540,365
|
|||
Total
current liabilities
|
1,057,047
|
|||
Senior
Secured Note Payable,
net of unamortized debt discount of $647,340
|
1,352,660
|
|||
Total
liabilities
|
2,409,707
|
|||
Commitments
|
||||
Stockholders’
Deficiency
|
||||
Preferred
stock, par value $10 per share; 10,000,000 shares
authorized
|
||||
Class
A convertible preferred stock, par value $10 per share;
|
||||
1,000,000
shares designated; none issued
|
-
|
|||
Class
B preferred stock, par value $10 per share;
|
||||
1,000,000
shares designated; none issued
|
-
|
|||
Common
stock, par value $.01 per share; 150,000,000 shares authorized;
|
||||
19,830,602
shares issued and outstanding
|
198,306
|
|||
Additional
paid-in capital
|
6,791,778
|
|||
Accumulated
deficit
|
(9,434,618
|
)
|
||
Accumulated
other comprehensive income - foreign currency translation
gains
|
139,021
|
|||
Total
stockholders’ deficiency
|
(2,305,513
|
)
|
||
Total
liabilities and stockholders’ deficiency
|
$
|
104,194
|
|
|||||||
2006
|
2005
|
||||||
Revenues:
|
|||||||
|
|||||||
Services
|
$
|
140,826
|
$
|
1,251,016
|
|||
Product
|
-
|
23,803
|
|||||
Total
revenues
|
140,826
|
1,274,819
|
|||||
|
|||||||
Cost
of revenues:
|
|||||||
Services
|
73,935 | 507,348 | |||||
Product
|
- | 20,737 | |||||
Total
cost of revenues
|
73,935
|
528,085
|
|||||
|
|||||||
Gross
margin
|
66,891
|
746,734
|
|||||
|
|||||||
Operating
expenses:
|
|||||||
Research
and development
|
196,341 | 459,029 | |||||
Selling,
general and administrative
|
771,921
|
1,428,285
|
|||||
Total
operating expenses
|
968,262
|
1,887,314
|
|||||
|
|||||||
Operating
loss
|
(901,371
|
)
|
(1,140,580
|
)
|
|||
|
|||||||
Other
income (expense):
|
|||||||
Interest
expense and amortization of debt discount
|
(439,140 | ) | (419,377 | ) | |||
Other
income
|
27,077 | 164,613 | |||||
Gain
on sale of assets
|
204,737 | - | |||||
Loss
on real property lease
|
(10,296 | ) | - | ||||
Gain
on fair value of warrants
|
- | 2,717 | |||||
Fair
value of penalty common stock
|
- | (79,982 | ) | ||||
|
|||||||
Total
other expense
|
(217,622
|
)
|
(332,029
|
)
|
|||
|
|||||||
Net
loss
|
$
|
(1,118,993
|
)
|
$
|
(1,472,609
|
)
|
|
Weighted
average number of shares outstanding
|
19,830,602
|
19,665,724
|
|||||
|
|||||||
Net
loss per share - basic and diluted
|
$
|
(0.06
|
)
|
$
|
(0.07
|
)
|
Common
Stock
|
Additional
Paid-in
|
Accumulated
|
Accumulated
Other Comprehensive
|
||||||||||||||||
Shares
|
Amount |
Capital
|
Deficit
|
Income
|
Total
|
||||||||||||||
Balance
at January 1, 2005
|
16,514,018
|
$
|
165,140
|
$
|
3,796,397
|
$
|
(6,843,016
|
)
|
$
|
147,416
|
$
|
(2,734,063
|
)
|
||||||
Reclassifications
of proceeds from sale of common stock and warrants with registration
rights through private placement
|
2,445,000
|
24,450
|
2,420,550
|
—
|
—
|
2,445,000
|
|||||||||||||
Reclassifications
of common stock and warrants issued for equipment
|
58,334
|
583
|
57,751
|
—
|
—
|
58,334
|
|||||||||||||
Shares
issued for late registration filing
|
563,250
|
5,633
|
247,830
|
—
|
—
|
253,463
|
|||||||||||||
Shares
issued in exchange for purchase of intangible assets
|
250,000
|
2,500
|
125,000
|
—
|
—
|
127,500
|
|||||||||||||
Warrants
issued in exchange for purchase of intangible assets
|
—
|
—
|
136,000
|
—
|
—
|
136,000
|
|||||||||||||
Foreign
currency translation loss (A)
|
—
|
—
|
—
|
—
|
(9,446
|
)
|
(9,446
|
)
|
|||||||||||
Net
loss
|
—
|
—
|
—
|
(1,472,609
|
)
|
—
|
(1,472,609
|
)
|
|||||||||||
Balance
at December 31, 2005
|
19,830,602
|
198,306
|
6,783,528
|
(8,315,625
|
)
|
137,970
|
(1,195,821
|
)
|
|||||||||||
Stock
compensation expense
|
—
|
—
|
8,250
|
—
|
—
|
8,250
|
|||||||||||||
Foreign
currency translation gain (A)
|
—
|
—
|
—
|
—
|
1,051
|
1,051
|
|||||||||||||
Net
loss
|
—
|
—
|
—
|
(1,118,993
|
)
|
—
|
(1,118,993
|
)
|
|||||||||||
Balance
at December 31, 2006
|
19,830,602
|
$
|
198,306
|
$
|
6,791,778
|
$
|
(9,434,618
|
)
|
$
|
139,021
|
$
|
(2,305,513
|
)
|
(A) Comprehensive loss (net loss plus or minus foreign currency translation loss or gain) for the year ended December 31, 2006 and 2005 totaled $1,117,942 and $1,482,055, respectively. |
2006
|
2005
|
|||||||||
Cash
flows from operating activities
|
||||||||||
Net
loss
|
$
|
(1,118,993
|
)
|
$
|
(1,472,609
|
)
|
||||
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
||||||||||
Amortization
of debt discount
|
222,068 |
222,068
|
||||||||
Amortization
of intellectual property
|
7,730 |
31,350
|
||||||||
Depreciation
expense
|
43,957 |
73,325
|
||||||||
Stock
compensation expense
|
8,250 |
-
|
||||||||
Gain
on sale of assets
|
(204,737 | ) |
-
|
|||||||
Loss
on real property lease
|
10,296 |
-
|
||||||||
Gain
on fair value of warrants
|
- |
(2,717
|
)
|
|||||||
Fair
value of penalty common stock
|
- |
79,982
|
||||||||
Deferred
rent
|
(8,816 | ) |
(14,713
|
)
|
||||||
Changes
in operating assets and liabilities:
|
||||||||||
Accounts
receivable
|
93,038 |
84,478
|
||||||||
Accounts
payable
|
(65,768 | ) |
48,080
|
|||||||
Accrued
expenses
|
182,404 |
181,770
|
||||||||
Accrued
compensation - officers
|
319,826 |
73,842
|
||||||||
Foreign
taxes payable
|
- |
(166,009
|
)
|
|||||||
Net
cash used in operating activities
|
(510,745
|
)
|
(861,153
|
)
|
||||||
Cash
flows from investing activities
|
||||||||||
Acquisition
of intangible assets
|
- |
(50,000
|
)
|
|||||||
Acquisition
of equipment
and furnishings
|
(5,316 | ) |
(46,229
|
)
|
||||||
Proceeds
from sale of equipment and furnishing
|
21,000 |
-
|
||||||||
Proceeds
from sale of intangible assets
|
500,000 |
-
|
||||||||
Net
cash provided by (used in) investing activities
|
515,684 |
(96,229
|
)
|
|||||||
Cash
flows from financing activities
|
||||||||||
Payment
of note payables to officers
|
(55,548 | ) |
-
|
|||||||
Proceeds
from the issuance of senior secured note and warrants
|
- |
500,000
|
||||||||
Net
cash provided by (used in) financing activities
|
(55,548
|
)
|
500,000
|
|||||||
Effect
of exchange rate changes on cash
|
1,658
|
(14,324
|
)
|
|||||||
Net
decrease in cash
|
(48,951 | ) |
(471,706
|
)
|
||||||
Cash,
beginning of year
|
122,318
|
594,024
|
||||||||
Cash,
end of year
|
$
|
73,367
|
$
|
122,318
|
||||||
Supplemental
disclosure of cash flow information
|
||||||||||
Interest
paid
|
$
|
-
|
$
|
-
|
||||||
Supplemental
schedule of noncash investing and financing
activities:
|
||||||||||
Intangible
assets purchased in exchange for common stock and warrants
|
$
|
-
|
$
|
263,500
|
For
Year Ended
December
31,
|
||||
2005
|
||||
|
||||
Net
loss, as reported
|
$
|
(1,472,609
|
)
|
|
Deduct:
Total stock-based employee compensation expense determined under
fair
value based method for all awards
|
(2,486
|
)
|
||
Pro
forma net loss
|
$
|
(1,475,095
|
)
|
|
Basic
and diluted loss per common share as reported
|
$
|
(0.07
|
)
|
|
Basic
and diluted loss per common share pro forma
|
$
|
(0.08
|
)
|
Equipment
(3 years useful life)
|
$
|
70,559
|
||
70,559
|
||||
Less:
Accumulated depreciation
|
(39,732
|
)
|
||
Total
|
$
|
30,827
|
Cost
|
Accumulated
Amortization
|
Net
|
Proceeds
from sale of IP
|
Gain
on sale of IP
|
||||||||||||
Amortizable
intangible assets - Intellectual Property
|
$
|
315,500
|
$
|
41,080
|
$
|
274,420
|
$
|
500,000
|
$
|
225,580
|
2006
|
2005
|
||||||||||||
Number
of Shares
|
Weighted-average
Exercise Price
|
Number
of Shares
|
Weighted-average
Exercise Price
|
||||||||||
Outstanding
at beginning of year
|
1,923,168
|
$
|
0.77
|
2,508,442
|
$
|
0.77
|
|||||||
Granted
to employees/directors
|
75,000
|
$
|
0.11
|
320,000
|
$
|
0.39
|
|||||||
Cancelled
|
(435,843
|
)
|
$
|
0.82
|
(905,274
|
)
|
$
|
0.66
|
|||||
Outstanding
at end of year
|
1,562,325
|
$
|
0.72
|
1,923,168
|
$
|
0.77
|
|||||||
Options
exercisable at year-end
|
1,562,325
|
$
|
0.72
|
1,906,168
|
$
|
0.77
|
|||||||
Weighted-average
fair value of options granted during the year
|
$
|
0.11
|
$
|
0.08
|
Options
Outstanding
|
Options
Exercisable
|
|||||||||||||||
Range
of Exercise Prices
|
Number
Outstanding
|
Weighted
Average Remaining Contractual Life (years)
|
Weighted-average
Exercise Price
|
Number
Exercisable
|
Weighted-average
Exercise Price
|
|||||||||||
$0.11
- $1.00
|
1,557,000
|
4.97
|
$
|
0.72
|
1,557,000
|
$
|
0.72
|
|||||||||
$1.01
- $1.31
|
5,325
|
7.17
|
$
|
1.13
|
5,325
|
$
|
1.13
|
|||||||||
1,562,325
|
1,562,325
|
Number
of Warrants Outstanding
|
Weighted-Average
Exercise Price
|
||||||
Outstanding
at January 1, 2005
|
17,246,123
|
$
|
0.76
|
||||
Granted
(A)
|
500,000
|
$
|
0.40
|
||||
Cancelled
|
(3,779,373
|
)
|
$
|
1.50
|
|||
Outstanding
at December 31, 2005
|
13,966,750
|
$
|
0.55
|
||||
Amendment
to Equity Warrant (A)
|
(6,000,000
|
)
|
$
|
0.60
|
|||
Expired
|
(100,000
|
)
|
$
|
0.75
|
|||
Outstanding
at December 31, 2006
|
7,866,750
|
$
|
0.50
|
2006
|
|
2005
|
|||||
Expected
volatility
|
224.24
|
%
|
66.16
|
%
|
|||
Risk-free
interest rate
|
5.25
|
%
|
3.97
|
%
|
|||
Expected
life (years)
|
10
|
1
to 10
|
|||||
Expected
dividends
|
0
|
%
|
0
|
%
|
Geographical
area
|
Revenues
from external customers
|
Long-lived
assets
|
|||||
United
States
|
-
|
$
|
1,448
|
||||
United
Kingdom
|
-
|
2,492
|
|||||
Australia
|
$
|
140,026
|
26,887
|
||||
$
|
140,026
|
$
|
30,827
|
Geographical
area
|
Revenues
from external customers
|
Long-lived
assets
|
|||||
United
States
|
$
|
7,296
|
$
|
88,892
|
|||
United
Kingdom
|
37,380
|
4,258
|
|||||
Australia
|
1,230,143
|
39,475
|
|||||
$
|
1,274,819
|
$
|
132,625
|
ITEM
8.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.
|
ITEM 8A. |
CONTROLS
AND PROCEDURES.
|
ITEM 9. |
DIRECTORS,
EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
SECTION
16(a) OF THE EXCHANGE ACT.
|
Name
|
Age
|
Position
|
||
Tibor
N. Vertes
|
58
|
Chief
Executive Officer and Chairman of the Board
|
||
Gregory
L. Hrncir
|
40
|
President,
Secretary and a Director
|
||
Jay
Sanet
|
57
|
Director
|
ITEM 10. |
EXECUTIVE
COMPENSATION.
|
Annual
Compensation
|
Long-Term
Compensation
(Stock/
|
All
Other
|
||||||||||||||
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Options)
|
Compensation
|
|||||||||||
Tibor
N. Vertes,
|
2006
|
-
|
-
|
-
|
27,982
|
|||||||||||
Chief
Executive
|
2005
|
86,667
|
0
|
0
|
42,400
|
|||||||||||
Officer
and Chairman1
|
2004
|
179,167
|
0
|
0
|
0
|
|||||||||||
Gregory
L. Hrncir,
|
2006
|
-
|
-
|
-
|
48,851
|
|||||||||||
President
and
|
2005
|
92,083
|
0
|
0
|
72,000
|
|||||||||||
Secretary2
|
2004
|
172,500
|
0
|
0
|
104,125
|
|||||||||||
Kevin
J Burman,
|
2006
|
15,000
|
-
|
-
|
-
|
|||||||||||
Chief
Operating
|
2005
|
130,000
|
0
|
0
|
0
|
|||||||||||
Officer3
|
2004
|
121,565
|
0
|
200,000
|
0
|
|||||||||||
Jay
Sanet,
|
2006
|
-
|
-
|
8,250
|
-
|
|||||||||||
Director4
|
2005
|
0
|
0
|
0
|
0
|
|||||||||||
2004
|
0
|
0
|
25,000
|
2,000
|
ITEM 11. |
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS.
|
· |
All
of our directors and executive officers, individually;
|
· |
All
of our directors and executive officers, as a group;
and
|
· |
All
persons who beneficially own more than five percent of our outstanding
common stock.
|
NAME
OF DIRECTOR OR EXECUTIVE OFFICER
|
NUMBER
OF SHARES
|
PERCENTAGE
|
|||||
Tibor
N. Vertes1
|
6,658,183
|
33.6
|
%
|
||||
Gregory
L. Hrncir2
|
2,388,567
|
12.0
|
%
|
||||
Jay
Sanet3
|
102,012
|
0.5
|
%
|
||||
Directors
and executive officers as a group (3 persons)4
|
9,148,762
|
46.1
|
%
|
NAME
OF FIVE PERCENT HOLDERS
|
NUMBER
OF SHARES
|
PERCENTAGE
|
|||||
Cantor
G&W (Nevada), L.P.5
|
7,948,966
|
40.1
|
%
|
Individual
Grants
|
Name
|
Number
of Securities Underlying Options/Sirs Granted
|
|
Percent
of Total Options/Sirs Granted to Employees in Fiscal
Year
|
|
Exercise
or Base Price ($/Share)
|
|
Expiration
Date
|
||||||
Tibor
N. Vertes
|
0
|
0.0
|
%
|
N/A
|
N/A
|
||||||||
Gregory
L. Hrncir
|
0
|
0.0
|
%
|
N/A
|
N/A
|
||||||||
Kevin
J. Burman
|
0
|
0.0
|
%
|
N/A
|
N/A
|
||||||||
Jay
Sanet
|
75,000
|
100.0
|
%
|
$
|
0.11
|
November
14, 2016
|
|||||||
Total
|
75,000
|
100.0
|
%
|
$
|
0.11
|
Name
|
Shares
Acquired on Exercise (#)
|
Value
Realized ($)
|
Number
of Securities Underlying Unexercised Options/SARs at Fiscal Year-End
Exercisable/Unexercisable
|
Value
of Unexercised in-the-Money Options/SARs at Fiscal Year-End
Exercisable/Unexercisable
|
|||||||||||||||
Tibor
N. Vertes
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||||||
Gregory
L. Hrncir
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||||||
Kevin
J. Burman
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||||||
Jay
Sanet
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
ITEM 12. |
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
|
ITEM 13. |
EXHIBITS
|
ITEM 14. |
PRINCIPAL
ACCOUNTANT FEES AND
SERVICES.
|
2006
|
2005
|
||||||
Audit
fees
(1)
|
$
|
51,968
|
$
|
101,759
|
|||
Audit-related
fees (2)
|
-
|
-
|
|||||
Tax
fees (3)
|
-
|
-
|
|||||
All
other fees
|
-
|
-
|
|||||
|
$
|
51,968
|
$
|
101,759
|
(1)
|
Audit
fees: Fees for the professional services rendered for the audit
of our
annual financial statements, review of financial statements included
in
our Form 10-QSB filings, and services normally provided in connection
with
statutory and regulatory filings or engagements, including registration
statements.
|
(2)
|
Audit-related
fees: Fees for assurance and related services that are reasonably
related
to the performance of the audit or review of our financial
statements.
|
(3) |
Tax
fees: Fees for professional services rendered with respect to tax
compliance, tax advice and tax planning. This includes preparation
of tax
returns, claims for refunds, payment planning and tax law interpretation.
|
GAMING&
ENTERTAINMENT
GROUP,
INC.
(Registrant)
|
||
|
|
|
By: |
/s/
Gregory L. Hrncir
|
|
Gregory
L. Hrncir, President
|
||
Date:
March
20, 2007
|
SIGNATURE
|
TITLE
|
DATE
|
||
/s/
Tibor N. Vertes
|
Chairman
and Chief Executive Officer
|
March
21, 2007
|
||
Tibor
N. Vertes
|
(Principal
Executive Officer)
|
|||
/s/
Gregory L. Hrncir
|
President,
Secretary and Director
|
March
21, 2007
|
||
Gregory
L. Hrncir
|
(Principal
Financial and Accounting Officer)
|
|||
/s/
Jay Sanet
|
Director
|
March
21, 2007
|
||
Jay
Sanet
|
EXHIBIT
INDEX
|
EXHIBIT
NUMBER
|
EXHIBIT
DESCRIPTION
|
PAGE
|
||
2.1
|
Agreement
and Plan of Reorganization dated as of September 18, 2003, by and
among
NorStar Group, Inc., a Utah corporation, Gaming & Entertainment Group,
Inc., a Nevada corporation, and certain of the holders of shares
of common
stock of Gaming & Entertainment Group, Inc., a Nevada corporation.
|
(1)
|
||
3.1
|
Amended
and Restated Articles of Incorporation
|
(2)
|
||
3.2
|
Amended
and Restated Bylaws
|
(2)
|
||
4.1
|
Stock
Certificate Specimen
|
(2)
|
||
10.1
|
Employment
Agreement of Tibor N. Vertes dated August 31, 2003
|
(2)
|
||
10.2
|
Employment
Agreement of Gregory L. Hrncir dated August 31, 2003
|
(2)
|
||
10.3
|
Employment
Agreement of Will McMaster dated August 31, 2003
|
(2)
|
||
10.4
|
Lease
Agreement by and among Gaming & Entertainment Group, Inc. and Airport
Plaza Associates, LLC dated February 24, 2004; First Amendment to
Lease
Agreement dated March 10, 2004
|
(2)
|
||
10.5
|
Employment
Agreement of Kevin J. Burman dated September 1, 2004
|
(2)
|
||
10.6
|
Loan
Facility and Investment Agreement by and between Gaming &
Entertainment Group, Inc. and Cantor G&W (Nevada), L.P. dated December
8, 2004
|
(3)
|
||
10.7
|
Senior
Secured Note by and between Gaming & Entertainment Group, Inc. and
Cantor G&W (Nevada), L.P. dated December 8, 2004
|
(3)
|
||
10.8
|
Equity
Warrant issued in favor of Cantor G&W (Nevada), L.P. dated December 8,
2004
|
(3)
|
||
10.9
|
Debt
Warrant issued in favor of Cantor G&W (Nevada), L.P. dated December 8,
2004
|
(3)
|
||
10.10
|
Form
of Interest Warrant to be issued in favor of Cantor G&W (Nevada), L.P.
|
(3)
|
||
10.11
|
Option
Agreement and Irrevocable Proxy by and between Cantor G&W (Nevada),
L.P., on the one hand, and Tibor N. Vertes, the Vertes Family Trust,
Gregory L. Hrncir, the Hrncir Family Trust, Kevin J. Burman, Sheldon
Harkness, Zen Investments Pty Ltd, Andrew Sorensen, and Gaming &
Entertainment Group, Ltd., on the other hand, dated December 8,
2004
|
(3)
|
||
10.12
|
Amended
and Restated Software Development and License Agreement by and between
Cantor G&W (Nevada), L.P., on the one hand, and Gaming &
Entertainment Group, Inc. and Gaming & Entertainment Technology Pty
Ltd, on the other hand, dated December 8, 2004
|
(3)
|
||
10.13
|
Amended
and Restated Source Code Escrow Agreement by and between Gaming &
Entertainment Group, Inc., Gaming
and Entertainment Technology, Pty Ltd, Cantor G&W (Nevada), L.P., GEG
Holdings, LLC, a Delaware limited liability company having an address
at
135 East 57th
Street, New York, New York 10022 (“Licensee”), Zukerman Gore &
Brandeis, LLP, located at 875 Third Avenue, New York, New York 10022
(“ZGB”) and BMM International Pty Limited of Level 3, 37-41 Prospect
Street, Box Hill, Victoria 3128, Australia (“BMM”), dated December 8,
2004
|
(3)
|
10.14
|
Asset
Purchase Agreement by and between Gaming & Entertainment Group, Inc.
and Absolute Game, Ltd. dated March 14, 2005
|
(4)
|
||
10.15
|
Consulting
Agreement by and between Gaming & Entertainment Group, Inc. and Peter
Bengtsson dated March 14, 2005
|
(4)
|
||
10.16
|
Common
Stock Purchase Warrant issued in favor of Peter Bengtsson dated March
14,
2005
|
(4)
|
||
10.17
|
Asset
Purchase Agreement by and between Gaming and Entertainment Group,
Inc.,
Gaming & Entertainment Technology Pty Limited and Cantor G&W
(Nevada), L.P. dated February 15, 2006
|
(5)
|
||
10.18
|
Amendment
No. 1 to Senior Secured Note issued in favor of Cantor G&W (Nevada),
L.P. dated February 15, 2006
|
(5)
|
||
10.19
|
Amendment
No. 1 to Security Agreement by and between Gaming and Entertainment
Group,
Inc., Gaming & Entertainment Technology Pty Limited and Cantor G&W
(Nevada), L.P. dated February 15, 2006
|
(5)
|
||
10.20
|
Amended
and Restated Equity Warrant issued in favor of Cantor G&W (Nevada),
L.P. dated February 15, 2006
|
(5)
|
||
10.21
|
Bill
of Sale by and between Gaming and Entertainment Group, Inc., Gaming
&
Entertainment Technology Pty Limited and Cantor G&W (Nevada), L.P.
dated February 15, 2006
|
(5)
|
||
21.1
|
List
of Subsidiaries
|
74
|
||
31.1
|
Certifications
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
Section 1350
|
75
|
||
31.2
|
Certifications
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
Section 1350
|
76
|
||
32.1
|
Certifications
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
Section 1350
|
77
|
(1)
|
Previously
filed as an exhibit to the registrant’s Proxy Statement on Schedule 14A,
as filed with the Commission on December 22, 2003.
|
(2)
|
Previously
filed as an exhibit to the registrant’s Annual Report on Form 10-KSB, as
filed with the Commission on April 14, 2004.
|
(3)
|
Previously
filed as an exhibit to the registrant’s Current Report on Form 8-K, as
filed with the Commission on December 9, 2004.
|
(4)
|
Previously
filed as an exhibit to the registrant’s Current Report on Form 8-K, as
filed with the Commission on March 18, 2005.
|
(5)
|
Previously
filed as an exhibit to the registrant’s Current Report on Form 8-K/A, as
filed with the Commission on February 22,
2006.
|