Related Party Transactions

12 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The Company provides video collaboration services (the “Video Services”) to ABM Industries, Inc. ("ABM"). James S. Lusk, who serves on the Board of Directors for the Company, is an officer of ABM. Video Services revenue from ABM for the years ended December 31, 2013 and 2012 were $136,000 and $210,000, respectively. As of December 31, 2013, the accounts receivable attributable to ABM was $2,000.

The Company receives general corporate strategy and management consulting services under a Consulting Agreement entered into on September 1, 2010 from Jon A. DeLuca, who serves on the Board of Directors for the Company. The Consulting Agreement is a month-to-month engagement pursuant to which the Company pays Mr. DeLuca $12,500 per month, plus any pre-authorized expenses incurred in providing services, under the Consulting Agreement. Related party consulting fees pursuant to this agreement for the years ended December 31, 2013 and 2012 were $150,000 and $150,000, respectively; and such fees have been recorded in General and Administrative expenses on the Company's consolidated statements of operations. As of December 31, 2013, the accounts payable to Mr. DeLuca was $25,000.

The Company received financial advisory services from Burnham Hill Partners, LLC ("BHP") under certain engagement agreements. In October 2013, the Company terminated all such engagement agreements with BHP. Jason Adelman, a principal of BHP, is a greater than 5% shareholder of the Company. In October 2012, the Company issued 100,000 shares of unregistered common stock and paid $250,000 in cash to BHP in consideration of services rendered. The cash and stock was divided equally between financing costs (which were included in Other Assets in the accompanying consolidated balance sheet as of December 31, 2012) and acquisition costs (recorded in General and Administrative expenses in the accompanying consolidated statement of operations for the year ended December 31, 2012). In connection with the termination of the agreements with BHP referenced above and to settle amounts due to BHP for financial advisory services, the Company agreed to pay BHP $100,000 and issue 100,000 of shares of Common Stock to BHP. The $100,000 fee and value of stock were included as a cost of the Series B-1 Preferred Stock Exchange (see Note 14). The shares were valued at $135,000 using the October 15, 2013 stock price of $1.35. Other financial advisory fees paid to BHP for the years ended December 31, 2013 and 2012, recorded in General and Administrative expenses on the Company's consolidated statements of operations were $96,000 and $143,000, respectively. As of December 31, 2013, there was no accounts payable to BHP.

Pursuant to a Sales Partner Agreement between Glowpoint and Nancy K. Holst, Ms. Holst is entitled to certain sales commissions. Ms. Holst is the wife of Peter Holst, the Company's President and CEO. For the years ended December 31, 2013 and 2012, she earned $21,000 and $15,000, respectively; and such commissions have been recorded in Sales and Marketing expenses on the Company's consolidated statements of operations. As of December 31, 2013, there was $3,000 accrued for payment to Ms. Holst. The Company terminated the Sales Partner Agreement with Ms. Holst effective December 31, 2013.

In August 2013, GP Investment Holdings, LLC (“GPI”) purchased 8,942,805 shares of the Company’s common stock and 95 shares of the Company’s Series B-1 Preferred Stock from Vicis Capital Master Fund in a private transaction. Following this transaction, the Company then issued 6,333,333 shares of the Company’s common stock to GPI in exchange for the conversion of 95 shares of the Company’s Series B-1 preferred stock that GPI purchased (see Note 13). As of December 31, 2013, GPI owns 15,276,138 shares, or 43%, of the Company’s common stock. GPI is an investment vehicle affiliated with Main Street Capital Corporation, our debt lender (see Note 7) and the Pessin family.

Pursuant to a registration rights agreement between us and GPI, we filed a registration statement covering 6,333,333 shares of common stock with the SEC on November 6, 2013, which was declared effective on November 14, 2013.

Transactions with related parties, including the transactions referred to above, are reviewed and approved by independent members of the Board of Directors of the Company.