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Related-Party Transactions
6 Months Ended
Jun. 30, 2011
Related Party Transactions [Abstract]  
Related Party Transactions Disclosure [Text Block]
Note 3 – Related-Party Transactions

Purchases

Historically, DCT has purchased the majority of its finished scanner imaging products from various related entities (referred to collectively as “Scanner Manufacturers”) owned by a DCT stockholder who currently owns approximately 15% of DCT’s outstanding common stock.

The Scanner Manufacturers purchase the non-critical raw materials, parts and components.  DCT procures the critical components required to manufacture its proprietary scanners.  Subsequently, the Scanner Manufacturers reimburse DCT for the cost of procuring these critical components.

Purchases from Scanner Manufacturers totaled $2,287,000 and $4,826,000 for the three and six months ended June 30, 2011, respectively, and $1,632,000 and $3,486,000 for the three and six months ended June 30, 2010, respectively.  All purchases to and from Scanner Manufacturers were carried out in the normal course of business.  As a result of the aforementioned purchases, the net due from related parties was $33,000 at June 30, 2011 and the net due to related parties was $654,000 at December 31, 2010.

At June 30, 2011, the amount due from related parties for critical components exceeded the amount owed to related parties for inventory purchases.  Reimbursements by related parties for critical components were temporarily delayed while the factory, which manufactures DCT’s scanners, was relocated from Shenzhen, China to Wuhan, China.  The new building was successfully completed and the factory was fully operational on June 1, 2011.  As such, DCT does not expect future reimbursements to be delayed.

Net Sales

During the six months ended June 30, 2011, DCT recorded sales and cost of sales of $11,000 and $10,000, respectively, to Scanner Manufacturers for finished scanners.  DCT had no sales to Scanner Manufacturers during the three months ended June 30, 2011.

During the three and six months ended June 30, 2010, DCT recorded sales of $24,000 and $70,000, respectively, to Scanner Manufacturers for finished scanners.  The related costs of sales were $21,000 and $60,000, respectively.

All sales to Scanner Manufacturers contained similar terms and conditions as for other transactions of this nature entered into by DCT.

The above sales were all made under an exclusive license agreement between DCT and Scanner Manufacturers dated January 1, 2009.  On June 10, 2011, DCT terminated the agreement.

Consulting Services

In February 2011, DCT entered into a month-to-month product development arrangement with Darwin Hu, a current member of DCT’s board of directors, whereby Mr. Hu is assisting DCT with expanding the current product offering.  The arrangement is cancellable by either party at any time.  Pursuant to the arrangement, Mr. Hu was paid $33,000 and $46,000 during the three and six months ended June 30, 2011, respectively.

Legal Services Agreement

On September 15, 2009, DCT entered into a legal services agreement (“Agreement”) with Jody R. Samuels, a director of the Company.  Pursuant to the Agreement, Mr. Samuels will provide certain legal services to us which will consist of assisting the Company in (i) the preparation of its periodic and other filings with the Securities and Exchange Commission (“SEC”), including proxy statements, special and annual meetings of shareholders, (ii) the negotiation of financing and corporate development transactions, (iii) preparation and review of documentation related to financing arrangements and corporate development transactions, (iv) preparing registration statements, and responding to any SEC inquiries/comment letters, (v) documenting corporate governance policies and procedures, and (vi) any other legal matters reasonably within the legal expertise of Mr. Samuels.

Pursuant to the Agreement, Mr. Samuels is paid $4,000 per month for a total of $12,000 and $24,000 for the three and six months ended June 30, 2011, respectively.  Mr. Samuels was paid $12,000 and $24,000 for the three and six months ended June 30, 1010.

The Agreement may be cancelled by either party with 30 days prior written notice.

Agreement to License Office Space

On April 26, 2010, DCT entered into a two-year license agreement (“License”) with Beau Dietl & Associates  (“BDA”) to license office space from BDA in New York City.  The purpose of the License is for DCT to have a physical presence in New York City.  In connection with the License, the Company paid BDA an upfront license fee of $50,000 as payment in full.  The $50,000 payment was capitalized and is being amortized, using the straight-line method, to selling, general and administrative expense over the term of the License.  In connection with the License, DCT recorded rent expense of $7,000 and $13,000 for the three and six months ended June 30, 2011, respectively; and $4,000 for both the three and six months ended June 30, 2010.

The License can be cancelled by either party with 90 days written notice.