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Long-Term Debt and Convertible Debt | 12 Months Ended
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Dec. 31, 2012
Long-Term Debt [Abstract] |
Long-Term Debt | Note 6 - Long-Term Debt and Convertible Debt The following table details the Company's long-term debt and convertible debt:
|  | Outstanding Balance |  |  |  |  |  |  |
|  | December 31, |  |  | December 31, |  |  | Current Interest |  |  |  |
|  | 2012 |  |  | 2011 |  |  | Rate |  |  | Maturity |
NTR line of credit (1) |  | $ | 3,583,358 |  |  | $ | - |  |  | 2.0% |  |  | August 1, 2014 |
Texas Capital Bank note and line of credit (2) |  |  | - |  |  |  | 3,683,214 |  |  | 6.0% |  |  | June 22, 2012 |
Mortgage payable |  |  | 1,957,678 |  |  |  | 2,064,887 |  |  | 6.7% |  |  | August 1, 2016 |
Settlement payment (3) |  |  | 23,890 |  |  |  | 136,860 |  |  | 8.0% |  |  | February 15, 2013 |
Notes payable |  |  | 8,443 |  |  |  | 13,936 |  |  | Various |  |  | Various |
Capital leases (4) |  |  | 28,285 |  |  |  | 52,098 |  |  | 17.4% |  |  | December 2013 |
Sub-Total |  |  | 5,601,654 |  |  |  | 5,950,995 |  |  |  |  |  |  |
Less: Capital leases |  |  | 28,285 |  |  |  | 52,098 |  |  |  |  |  |  |
Less: Current maturities |  |  | 146,949 |  |  |  | 451,674 |  |  |  |  |  |  |
Long-term debt |  |  | 5,426,420 |  |  |  | 5,447,223 |  |  |  |  |  |  |
Less: Line of credit (1) (2) |  |  | 3,583,358 |  |  |  | 2,999,887 |  |  |  |  |  |  |
Long term debt, less current maturities |  | $ | 1,843,062 |  |  | $ | 2,447,336 |  |  |  |  |  |  |
| (1) | On July 19, 2012, DGSE entered into a Loan Agreement with NTR Metals, LLC, DGSE's majority stockholder ("NTR"), pursuant to which NTR, agreed to provide the Company a guidance line of revolving credit in an amount up to $7,500,000. The Loan Agreement will terminate-and all amounts outstanding thereunder will be due and payable (such amounts, the "Obligations")-upon the earlier of: (i) August 1, 2014; (ii) the date that is twelve months after the Company receives notice from NTR demanding the repayment of the Obligations; (iii) the date the Obligations are accelerated in accordance with the terms of the Loan Agreement; or (iv) the date on which the commitment terminates under the Loan Agreement. In connection with the Loan Agreement, the Company granted a security interest in the respective personal property of each of its subsidiaries. The loan carries an interest rate of two percent (2%) per annum for all funds borrowed pursuant to the Loan Agreement. Proceeds received by the Company pursuant to the terms of the Loan Agreement were used for repayment of all outstanding financial obligations incurred in connection with that certain Loan Agreement, dated as of December 22, 2005, between the Company and Texas Capital Bank, and additional proceeds are expected to be used as working capital in the ordinary course of business. The Company incurred debt issuance costs associated with the Loan Agreement totaling $56,150. The debt issuance costs are included in other assets in the accompanying consolidated balance sheet and will be amortized to interest expense on a straight-line basis over two years.
| (2) | Based on the revolving promissory notes payable to the bank, a note of $0 and $2,999,887 at December 31, 2012 and December 31, 2011, respectively, which bears an interest rate of 6% or prime plus 1%, was due June 22, 2012. In addition, the Company held another note of $566,658 which bears an interest rate of 6% or prime plus 1%, and was due in equal monthly payments of $16,667 through June 22, 2012. These notes were secured by all accounts receivable, inventory, property and equipment and intangible assets. The notes contained certain covenants, restricting payment of dividends and requiring the Company to maintain certain financial ratios. The outstanding balance associated with the notes payable and line of credit was repaid on July 19, 2012 in connection with the Loan Agreement with NTR.
| (3) | On February 26, 2010, Superior Galleries entered into a settlement agreement for a lawsuit filed by its previous landlord, DBKK, LLC for $385,000 to be paid over three years bearing interest at 8%. The lawsuit resulted from a lease transaction entered into by certain officers of Superior Galleries.
| (4) | On November 23, 2010, DGSE entered into a capital lease for $78,450 with Direct Capital Corporation for a radio-frequency identification ("RFID") inventory management solution. The non-cancelable lease agreement required an advanced payment of $5,169 and monthly payments of $2,584 for 36 months at an interest rate of 11.5% beginning in January 2011. At the end of the lease in December 2013, the equipment can be purchased for $1.
Maturities of our long-term obligations over the next five years are as follows:
|  | Total |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | Thereafter |
Line of credit, related party |  | $ | 3,583,358 |  |  | $ | - |  |  | $ | 3,583,358 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Long-term debt and capital leases |  |  | 2,018,296 |  |  |  | 175,234 |  |  |  | 122,536 |  |  |  | 131,003 |  |  |  | 1,589,523 |  |  |  | - |  |  |  | - |
Total |  | $ | 5,601,654 |  |  | $ | 175,234 |  |  | $ | 3,705,894 |  |  | $ | 131,003 |  |  | $ | 1,589,523 |  |  | $ | - |  |  | $ | - |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 129 -Paragraph 2, 4 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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