RMG Networks Holding Corp - 10-Q filing on 2014-11-14

Note 18 - Related Party Transactions	9 Months Ended
Sep. 30, 2014
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block]	18. Related Party Transactions In August 2013 the Company entered into a two-year Management Services Agreement with 2012 DOOH Investments, LLC (the "Consultant"), an entity managed by Mr. Donald R. Wilson, a major stockholder. Under the agreement, the Consultant provides management consulting services to the Company and its subsidiaries with respect to financing, acquisitions, sourcing, diligence, and strategic planning. In consideration for its services, the Consultant received a one-time payment of 120,000 shares of the common stock of the Company which had a market value of $960,000 when issued in August 2013. The value of the common stock is being amortized over the term of the agreement and related charges to operations for the nine months and three months ended September 30, 2014 were $384,750 and $120,000, respectively. The unamortized value of the common stock was $400,000 and $784,750 at September 30, 2014 and December 31, 2013, respectively. The unamortized balance of the common stock at September 30, 2014 is included in other current assets. $480,000 of the unamortized value of the common stock at December 31, 2013 is included in other current assets. The remainder of the unamortized balance of the common stock at December 31, 2013 is included in other assets. Under the Agreement, the Consultant also receives an annual services fee of $50,000. In addition, the Company provides consulting services to an entity owned by Mr. Wilson for which it has recognized related consulting fees during the nine months and three months ended September 30, 2014 of $400,000 and $112,500, respectively. The Company also had an agreement with a company owned by a board member under which it paid $15,000 a month for public relations services. This agreement was terminated on June 30, 2014. Under this agreement the Company incurred charges for the nine months ended September 30, 2014 of $90,000. As discussed in Note 5, the Company's former senior lender sold its interest in the Company's Senior Credit Facility to a new lender group that included the Company's Executive Chairman and largest shareholder. Interest expense paid to the new lender group was $308,000 during the three months ended September 30, 2014.

Note 18 - Related Party Transactions

9 Months Ended

Sep. 30, 2014

18. Related Party Transactions

In August 2013 the Company entered into a two-year Management Services Agreement with 2012 DOOH Investments, LLC (the "Consultant"), an entity managed by Mr. Donald R. Wilson, a major stockholder. Under the agreement, the Consultant provides management consulting services to the Company and its subsidiaries with respect to financing, acquisitions, sourcing, diligence, and strategic planning.

In consideration for its services, the Consultant received a one-time payment of 120,000 shares of the common stock of the Company which had a market value of $960,000 when issued in August 2013. The value of the common stock is being amortized over the term of the agreement and related charges to operations for the nine months and three months ended September 30, 2014 were $384,750 and $120,000, respectively. The unamortized value of the common stock was $400,000 and $784,750 at September 30, 2014 and December 31, 2013, respectively. The unamortized balance of the common stock at September 30, 2014 is included in other current assets. $480,000 of the unamortized value of the common stock at December 31, 2013 is included in other current assets. The remainder of the unamortized balance of the common stock at December 31, 2013 is included in other assets. Under the Agreement, the Consultant also receives an annual services fee of $50,000.

In addition, the Company provides consulting services to an entity owned by Mr. Wilson for which it has recognized related consulting fees during the nine months and three months ended September 30, 2014 of $400,000 and $112,500, respectively.

The Company also had an agreement with a company owned by a board member under which it paid $15,000 a month for public relations services. This agreement was terminated on June 30, 2014. Under this agreement the Company incurred charges for the nine months ended September 30, 2014 of $90,000.

As discussed in Note 5, the Company's former senior lender sold its interest in the Company's Senior Credit Facility to a new lender group that included the Company's Executive Chairman and largest shareholder. Interest expense paid to the new lender group was $308,000 during the three months ended September 30, 2014.