| x | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------|

|  ̈ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|------------------------------------------------------------------------------------|

| For the transition period from              to              |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Commission file number: 333-141521                                                                                                                                                  |

|                                                          |   |                                |
|---------------------------------------------------------------|--------|-------------------------------------|
| Delaware                                                      |   | 20-5433090                          |
| (State or Other Jurisdiction ofIncorporation or Organization) |   | (I.R.S. EmployerIdentification No.) |
|                                                          |   |
| 10957 McCormick Road, Hunt Valley, Maryland                   |   | 21031                               |
| (Address of Principal Executive Offices)                      |   | (Zip Code)                          |

|                                     |         |                                  |   |   |
|------------------------------------------|--------------|---------------------------------------|--------|--------|
| Large accelerated filer  ̈ |    | Accelerated filer  ̈         |   |   |
|                                     |         |                                  |
| Non-accelerated filer  ̈             |    | Smaller reporting company x |   |   |

----

|          |         |                                                                                                                              |         |         |   |         |
|---------------|--------------|-----------------------------------------------------------------------------------------------------------------------------------|--------------|--------------|--------|--------------|
|          |    |                                                                                                                              |    | Page         |   |
|          |    | Explanation of Restatements                                                                                                       |         |         | 2      |         |
|          |         |                                                                                                                              |
| Item 1.  |    | Financial Statements (Unaudited)                                                                                                  |    |         | 3      |    |
|          |         |                                                                                                                              |
|          |    | Condensed Consolidated Balance Sheets as of September 30, 2010 (Unaudited) and December 31, 2009                        |    |         | 3      |         |
|          |         |                                                                                                                              |
|          |    | Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September  30, 2010 and 2009 (unaudited) |    |         | 4      |    |
|          |         |                                                                                                                              |
|          |    | Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2010 and 2009 (unaudited)            |    |         | 5      |    |
|          |         |                                                                                                                              |
|          |    | Notes to Condensed Consolidated Financial Statements (unaudited).                                                                 |    |         | 6      |    |
|          |         |                                                                                                                              |
| Item 2.  |    | Management’s Discussion and Analysis of Financial Condition and Results of Operations                                       |    |         | 19     |    |
|          |         |                                                                                                                              |
| Item 3.  |    | Quantitative and Qualitative Analysis About Market Risk                                                                           |    |         | 23     |    |
|          |         |                                                                                                                              |
| Item 4.  |    | Controls and Procedures                                                                                                           |    |         | 23     |    |
|          |         |                                                                                                                              |
|          |    | PART II - OTHER INFORMATION                                                                                                       |    |         |   |         |
|          |         |                                                                                                                              |
| Item 1.  |    | Legal Proceedings                                                                                                                 |    |         | 24     |    |
|          |         |                                                                                                                              |
| Item 1A. |    | Risk Factors                                                                                                                      |    |         | 24     |    |
|          |         |                                                                                                                              |
| Item 2.  |    | Unregistered Sales of Equity Securities and Use of Proceeds                                                                       |    |         | 24     |    |
|          |         |                                                                                                                              |
| Item 3.  |    | Defaults Upon Senior Securities                                                                                                   |    |         | 24     |    |
|          |         |                                                                                                                              |
| Item 4.  |    | Removed and Reserved                                                                                                              |    |         | 24     |    |
|          |         |                                                                                                                              |
| Item 5.  |    | Other Information                                                                                                                 |    |         | 24     |    |
|          |         |                                                                                                                              |
| Item 6.  |    | Exhibits                                                                                                                          |    |         | 24     |    |
|          |         |
| SIGNATURES    |    |                                                                                                                              | 25           |    |

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| ·   | Total stock-based compensation expense in connection with options granted to employees recognized in the consolidated statement of operations for the three and nine months ended September 30, 2010 incorrectly calculated an accelerated stock option vesting for certain employees which consequently impacted amortization of the Stock Compensation (Accounting Standards Codification ("ASC") 718 "Compensation - Stock Compensation") over the remaining vesting period.  Furthermore, the Company reevaluated the historical volatility methodology utilized in the calculation of the employee stock-based compensation and non-employee stock-based compensation to estimate an expected volatility of similar public companies. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined it had certain product financing arrangement with a related party, DK Trading Partners, LLC ("DK Trading") under ASC 470-40 Product Financing Arrangements had not been properly recorded and disclosed. DK Trading was required to procure, purchase and sell up to $3,000,000 of pre-owned video games and the arrangement required the Company to provide a minimum consideration to the related party of $600,000 from the period of August 13, 2010 through September 15, 2010.  Furthermore, the Company failed to include the $600,000 consideration in the Cost of Sales in the Statement of Operations for the three and nine months ended September 30, 2010. Lastly, the Company inaccurately accrued only $300,000 of the $600,000 consideration on the Balance Sheet as of September 30, 2010. The previous filed 10Q omitted the disclosures relating to the transaction and the corresponding balance due of $3.6 million to DK Trading at September 30, 2010 was reclassified from Accounts Payable to Product Financing -Related Party on the Condensed Consolidated Balance Sheet. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined  a customer order of approximately $1.1 million recognized as revenue in the three months and nine months ended September 30, 2010 Statement of Operations was incorrectly recorded due to the failure to meet the revenue recognition criteria in accordance with FASB’s Accounting Standards Codification, or ASC, 605-10 attributable to timing occurrence of the delivery cut off. The Company determined the customer's F.O.B. destination order shipped in September 2010 was subsequently received by the customer in October 2010.  The Company will decrease revenue  in the amount of approximately $1.1 million and decrease cost of sales in the amount of approximately $623,000 for the three and nine months ended September 30, 2010. A corresponding decrease in accounts receivable of $1.1 million and increase in inventory of approximately $623,000 have been adjusted accordingly. The transaction will be included in the fourth quarter and full year end results of 2010. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined it had not properly calculated the costs of sales utilizing the average costs method for three and nine months ended September 30, 2010.  Subsequently, the Statement of operations have been adjusted to reflect an appropriate allocation and the corresponding inventory adjustment has been recorded increasing the cost of sales and decreasing inventory in the amount of approximately $472,000  for the three months ended September 30, 2010 and increasing the cost of sales and decreasing inventory in the amount of approximately $565,000 for the nine months ended September 30, 2010  . |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  Item 1. | Financial Statements |
|--------------------|----------------------|

|                                                                                                                                                                                                                                                 |         |                                                            |                |          |                            |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|-----------------------------------------------------------------|---------------------|---------------|---------------------------------|
|                                                                                                                                                                                                                                                 |    | (As Restated) See Note 2 (Unaudited)September 30,2010 |                |          | *(Audited)December 31,2009 |   |
| ASSETS                                                                                                                                                                                                                                               |    |                                                            |                |          |                            |   |   |   |
| Current Assets                                                                                                                                                                                                                                       |    |                                                            |                |          |                            |   |   |   |
| Cash and cash equivalents                                                                                                                                                                                                                            |    | $                                                               | 411,003             |     |                            | $ | 641,088 |    |
| Accounts receivable - Net of allowance of $100,000 as of September 30, 2010 and December 31, 2009                                                                                                                                          |    |                                                            | 4,184,855           |     |                            |   | 2,383,688 |    |
| Inventories                                                                                                                                                                                                                                          |    |                                                            | 7,757,758           |     |                            |   | 2,897,432 |    |
| Prepaid expenses and other                                                                                                                                                                                                                           |    |                                                            | 136,569             |     |                            |   | —   |    |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| TOTAL CURRENT ASSETS                                                                                                                                                                                                                                 |    |                                                            | 12,490,185          |     |                            |   | 5,922,208 |    |
| Property and equipment, net                                                                                                                                                                                                                          |    |                                                            | 330,499             |     |                            |   | 109,984 |    |
| Other assets                                                                                                                                                                                                                                         |    |                                                            |                |          |                            |   |   |   |
| Deferred financing costs                                                                                                                                                                                                                             |    |                                                            | —   |     |                            |   | 258,325 |    |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| TOTAL OTHER ASSETS                                                                                                                                                                                                                                   |    |                                                            | —   |     |                            |   | 258,325 |    |
| TOTAL ASSETS                                                                                                                                                                                                                                         |    | $                                                               | 12,820,684          |     |                            | $ | 6,290,517 |    |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                                                                           |    |                                                            |                |          |                            |   |   |   |
| Current Liabilities                                                                                                                                                                                                                                  |    |                                                            |                |          |                            |   |   |   |
| Accounts payable                                                                                                                                                                                                                                     |    | $                                                               | 3,545,756           |     |                            | $ | 3,967,429 |    |
| Accounts payable - related party                                                                                                                                                                                                                     |         |                                                            | -                   |          |                            |   | 285,967 |   |
| Product financing - related party                                                                                                                                                                                                                    |         |                                                            |  3,599,562     |          |                            |   | - |   |
| Accrued expenses and other                                                                                                                                                                                                                           |    |                                                            | 165,684             |     |                            |   | 60,534 |    |
| Revolving line of credit                                                                                                                                                                                                                             |    |                                                            | 2,363,285           |     |                            |   | —   |    |
| Note payable – current portion                                                                                                                                                                                                                 |    |                                                            | —   |     |                            |   | 513,046 |    |
| Note payable – related party                                                                                                                                                                                                                   |    |                                                            | 16,255              |     |                            |   | 408,424 |    |
| Discontinued operations – liability                                                                                                                                                                                                            |    |                                                            | —   |     |                            |   | 88,921 |    |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| TOTAL CURRENT LIABILITIES                                                                                                                                                                                                                            |    |                                                            | 9,690,542           |     |                            |   | 5,324,321 |    |
| Long Term Liabilities                                                                                                                                                                                                                                |    |                                                            |                |          |                            |   |   |   |
| Note Payable – non-current portion                                                                                                                                                                                                             |    |                                                            | —   |     |                            |   | 2,236,954 |    |
| Warrant redemption liability                                                                                                                                                                                                                         |    |                                                            | —   |     |                            |   | 281,935 |    |
| TOTAL LONG TERM LIABILITIES                                                                                                                                                                                                                          |    |                                                            | —   |     |                            |   | 2,518,889 |    |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| TOTAL LIABILITIES                                                                                                                                                                                                                                    |    |                                                            | 9,690,542           |     |                            |   | 7,843,210 |    |
| Redeemable preferred stock, Series A; $.0001 par value, 2,837,500 shares authorized, 2,837,500 and 0 shares issued and outstanding at September, 30, 2010 and December 31, 2009, respectively, net (Face value $5,675,000 and $0, respectively) |    |                                                            | 674,839             |     |                            |   | —   |    |
| Stockholders’ equity                                                                                                                                                                                                                           |    |                                                            |                |          |                            |   |   |   |
| Preferred stock, $0.0001 par value, 17,162,500 shares authorized, none issued and outstanding as of September 30, 2010 and December, 31, 2009, respectively                                                                                     |    |                                                            | —   |     |                            |   | —   |    |
| Common stock, $0.0001 par value, 100,000,000 shares authorized, 8,290,000 and 7,090,000 shares issued and outstanding at September 30, 2010 and December 31, 2009, respectively                                                            |    |                                                            | 829                 |     |                            |   | 709 |    |
| Additional paid-in capital                                                                                                                                                                                                                           |    |                                                            | 7,757,389           |     |                            |   | 89,659 |    |
| Accumulated deficit                                                                                                                                                                                                                                  |    |                                                            | (5,302,915          | )        |                            |   | (1,643,061 | )  |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| Total stockholders’ equity                                                                                                                                                                                                                     |    |                                                            | 2,455,303           |     |                            |   | (1,552,693 | )  |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                                                                     |    | $                                                               | 12,820,684          |     |                            | $ | 6,290,517 |    |
|                                                                                                                                                                                                                                                 |    |                                                            |                |          |                            |   |   |   |

| * | Derived from audited financial statements |
|---|-------------------------------------------|

----

|                                                                                                                      |
|---------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                      |   | For The Three Months EndedSeptember 30, |   |   | For The Nine Months  EndedSeptember 30, |   |
|                                                                                                                      |    |  (As Restated) See Note 22010 |   |   | 2009 |   |   | (As Restated) See Note 22010 |   |   | 2009 |   |
| Net sales                                                                                                                 |    | $ | 8,005,366 |    |   | $ | 6,527,744 |    |   | $ | 26,038,605 |    |   | $ | 27,867,603 |    |
| Cost of sales                                                                                                             |    |   | 7,927,525 |    |   |   | 5,145,000 |    |   |   | 23,301,759 |    |   |   | 23,212,718 |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross Profit                                                                                                              |    |   | 77,841 |    |   |   | 1,382,744 |    |   |   | 2,736,846 |    |   |   | 4,654,885 |    |
| Operating expenses:                                                                                                       |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling, general and administrative                                                                                       |    |   | 957,656 |    |   |   | 1,059,480 |    |   |   | 3,570,980 |    |   |   | 2,329,543 |    |
| Employee stock based compensation                                                                                         |    |   | 452,285 |    |   |   | —   |    |   |   | 1,126,251 |    |   |   | —   |    |
| Non-employee stock based compensation                                                                                     |    |   | —   |    |   |   | —   |    |   |   | 1,579,689 |    |   |   | —   |    |
| Depreciation                                                                                                              |    |   | 24,501 |    |   |   | 20,429 |    |   |   | 59,800 |    |   |   | 53,822 |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Operating Expense                                                                                                   |    |   | 1,434,442 |    |   |   | 1,079,909 |    |   |   | 6,336,720 |    |   |   | 2,383,365 |    |
| Income (Loss) from Operations                                                                                             |    |   | (1,356,601 | )   |   |   | 302,835 |    |   |   | (3,599,874 | )  |   |   | 2,271,520 |    |
| Other Income (Expenses):                                                                                                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense, net                                                                                                     |    |   | (23,206 | )  |   |   | (223,700 | )  |   |   | (106,473 | )  |   |   | (579,578 | )  |
| Other                                                                                                                     |    |   | —   |    |   |   | —   |    |   |   | 46,493 |    |   |   | —   |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Other Income (Expenses)                                                                                             |    |   | (23,206 | ) |   |   | (223,700 | )  |   |   | (59,980 | ) |   |   | (579,578 | )  |
| Income (Loss) Before Provision for Income Taxes                                                                           |    |   | (1,379,807 | )   |   |   | 79,135 |    |   |   | (3,659,854 | ) |   |   | 1,691,943 |    |
| Provision for income taxes                                                                                                |    |   | —   |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (Loss) from Continuing Operations                                                                                  |    | $ | (1,379,807, | )   |   | $ | 79,135 |    |   | $ | (3,659,854 | ) |   | $ | 1,691,943 |    |
| Discontinued Operations                                                                                                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss from discontinued operations                                                                                         |    |   | —   |    |   |   | 21,847 |    |   |   | —   |    |   |   | 90,656 |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) attributable to common shareholders before accretion of preferred dividends and discount |    | $ | (1,379,807 | )   |   | $ | 57,288 |    |   | $ | (3,659,854 | ) |   | $ | 1,601,287 |    |
| Accretion of preferred dividends and discount                                                                             |    |   | 70,939 |    |   |   |   |   |   |   | 155,903 |    |   |   | —   |    |
| Accretion of preferred amortization of beneficial conversion and warrant features                                         |    |   | 283,749 |    |   |   |   |   |   |   | 602,915 |   |   |   |   |   |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) attributable to common shareholders                                                                |    | $ | (1,734,495 | ) |   | $ | 57,288 |    |   | $ | (4,418,672 | ) |   | $ | 1,601,287 |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) per share:                                                                                              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) per share from continuing operations – basic and diluted                                              |    | $ | (0.17 | )   |   | $ | 0.01 |    |   | $ | (0.45 | ) |   | $ | 0.24 |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) per share from discontinued operations – basic and diluted                                            |    | $ | 0.00 |    |   | $ | (0.00 | )  |   | $ | 0.00 |    |   | $ | (0.01 | )  |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) per share – basic and diluted                                                                     |    | $ | (0.17 | )   |   | $ | 0.01 |    |   | $ | (0.45 | ) |   | $ | 0.23 |    |
|                                                                                                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted Average Common Shares Outstanding – basic and diluted                                                      |    |   | 8,290,000 |    |   |   | 7,090,000 |    |   |   | 8,043,846 |    |   |   | 7,090,000 |    |

----

|                                                                                      |
|-------------------------------------------------------------------------------------------|
|                                                                                      |    | For the Nine  MonthsEnded September 30, |   |
|                                                                                      |    | (As Restated) See Note 22010 |   |   | 2009 |   |
| Cash flows from operating activities                                                      |    |   |   |   |   |   |   |   |
| Net income (Loss) attributable to common shareholders                                     |    | $ | (3,659,854 | )  |   | $ | 1,601,287 |    |
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |    |   |   |   |   |   |   |   |
| Depreciation & amortization - Property and Equipment                        |    |   | 59,800 |    |   |   | 53,822 |    |
| Issuance of Stock Warrants for Services                                                   |    |   | 1,579,689 |    |   |   | —   |    |
| Stock Options for employee services                                                       |    |   | 1,126,251 |    |   |   | —   |    |
| Other                                                                                     |    |   | 12,317 |    |   |   | —   |    |
| Changes in assets and liabilities                                                         |    |   |   |   |   |   |   |   |
| Accounts receivable                                                                       |    |   | (1,801,167 | )  |   |   | (1,285,044 | )  |
| Inventory                                                                                 |    |   | (4,860,326 | )  |   |   | 1,830,586 |    |
| Accounts payable                                                                          |    |   | (707,640 | )   |   |   | 718,336 |    |
| Accrued liabilities                                                                       |    |   | 105,149 |    |   |   | (25,379 | ) |
| Deferred expenses                                                                         |    |   | 9,801 |    |   |   | 147,107 |    |
| Prepaid expenses and other                                                                |    |   | (136,568 | )  |   |   | —   |    |
| Liabilities of discontinued operation                                                     |    |   | (88,921 | )  |   |   | —   |    |
|                                                                                      |    |   |   |   |   |   |   |   |
| Net cash provided (used) in operating activities                                          |    |   | (8,361,469 | )  |   |   | 3,040,715 |    |
| Cash flows from investing activities                                                      |    |   |   |   |   |   |   |   |
| Purchases of fixed assets                                                                 |    |   | (280,315 | )  |   |   | (37,280 | ) |
|                                                                                      |    |   |   |   |   |   |   |   |
| Net cash provided (used) in investing activities                                          |    |   | (280,315 | )  |   |   | (37,280 | ) |
| Cash flows from financing activities                                                      |    |   |   |   |   |   |   |   |
| Proceeds from the sale of convertible preferred stock                                     |    |   | 5,675,000 |    |   |   | —   |    |
| Proceeds from line of credit, net                                                         |    |   | 2,363,285 |    |   |   | (2,001,127 | ) |
| Net borrowings in connection with Product financing facilities                            |   |   | 3,599,562 |   |   |   |   |   |
| Repayments on notes payable                                                               |    |   | (2,750,000 | )  |   |   | (958,693 | )  |
| Payment of Series A preferred dividends                                                   |    |   | (83,979 | ) |   |   | —   |    |
| Advance (repayment) of due to stockholder                                                 |    |   | —   |    |   |   | (19,878 | )  |
| Issuance (repayment) of note payable-related party                                        |    |   | (392,169 | ) |   |   | (156,660 | )  |
|                                                                                      |    |   |   |   |   |   |   |   |
| Net cash provided (used) in financing activities                                          |    |   | 8,411,699 |    |   |   | (3,136,358 | )  |
|                                                                                      |    |   |   |   |   |   |   |   |
| Net increase (decrease) in cash and cash equivalents                                      |    |   | (230,085 | )  |   |   | (132,923 | ) |
| Cash and cash equivalents at the beginning of the period                                  |    |   | 641,088 |    |   |   | 301,397 |    |
|                                                                                      |    |   |   |   |   |   |   |   |
| Cash and cash equivalents at the end of the period                                        |    | $ | 411,003 |    |   | $ | 168,474 |    |
|                                                                                      |    |   |   |   |   |   |   |   |
| Supplemental disclosure of cash flow information :                                        |    |   |   |   |   |   |   |   |
| Cash paid for interest                                                                    |    | $ | 106,473 |    |   | $ | 579,578 |    |
|                                                                                      |    |   |   |   |   |   |   |   |
| Cash paid for taxes                                                                       |    | $ | —   |    |   | $ | —   |    |

----

----

----

----

|   | a) | the option to settle by issuing equity instruments lacks commercial substance, or |
|--------|----|-----------------------------------------------------------------------------------|

|   | b) | the present obligation is implied because of an entity’s past practices or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction should be recognized as equity. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | a) | the goods or services received or |
|--------|----|-----------------------------------|

|   | b) | the equity instruments issued. |
|--------|----|--------------------------------|

|   | • |   | Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. |
|--------|---------|--------|--------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. |
|--------|---------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. |
|--------|---------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| ·   | Total stock-based compensation expense in connection with options granted to employees recognized in the consolidated statement of operations for the three and nine months ended September 30, 2010 incorrectly calculated an accelerated stock option vesting for certain employees which consequently impacted amortization of the Stock Compensation (Accounting Standards Codification ("ASC") 718 "Compensation - Stock Compensation") over the remaining vesting period.  Furthermore, the Company reevaluated the historical volatility methodology utilized in the calculation of the employee stock-based compensation and non-employee stock-based compensation to estimate an expected volatility of similar public companies. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined it had certain product financing arrangement with a related party, DK Trading Partners, LLC ("DK Trading") under ASC 470-40 Product Financing Arrangements had not been properly recorded and disclosed. DK Trading was required to procure, purchase and sell up to $3,000,000 of pre-owned video games and the arrangement required the Company to provide a minimum consideration to the related party of $600,000 from the period of August 13, 2010 through September 15, 2010.  Furthermore, The Company failed to include the $600,000 consideration in the Cost of Sales in the Statement of Operations for the three and nine months ended September 30, 2010. Furthermore, the Company inaccurately accrued only $300,000 of the $600,000 consideration on the Balance Sheet as of September 30, 2010. The previous filed 10Q omitted the disclosures relating to the transaction and the corresponding balance due of $3.6 million to DK Trading at September 30, 2010 was reclassified from Accounts Payable to Product Financing -Related Party on the Condensed Consolidated Balance Sheet. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined  a customer order of approximately $1.1 million recognized as revenue in the three months and nine months ended September 30, 2010 Statement of Operations was incorrectly recorded due to the failure to meet the revenue recognition criteria in accordance with FASB’s Accounting Standards Codification, or ASC, 605-10 attributable to timing occurrence of the delivery. The Company determined the customer's F.O.B. destination order shipped in September 2010 was subsequently received by the customer in October 2010.  The Company will decrease revenue  in the amount of approximately $1.1 million and decrease cost of sales in the amount of approximately $623,000 for the three and nine months ended September 30, 2010. A corresponding decrease in accounts receivable of $1.1 million and increase in inventory of approximately $623,000 have been adjusted accordingly. The transaction will be included in the fourth quarter and full year end results of 2010. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined it had not properly calculated the costs of sales utilizing the average costs method. Subsequently, the Statement of operations have been adjusted to reflect an appropriate allocation and the corresponding inventory adjustment has been recorded decreasing the cost of sales and increasing inventory in the amount of approximately $471,000 and $565,000 for the three and nine months ended September 30, 2010. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Company determined it had not properly calculated the costs of sales utilizing the average costs method for three and nine months ended September 30, 2010.  Subsequently, the Statement of operations have been adjusted to reflect an appropriate allocation and the corresponding inventory adjustment has been recorded increasing the cost of sales and decreasing inventory in the amount of approximately $472,000  for the three months ended September 30, 2010 and increasing the cost of sales and decreasing inventory in the amount of approximately $565,000 for the nine months ended September 30, 2010. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Game Trading Technologies, Inc. and Subsidiary                                                                                                                                                                                                                                                                                                                                                                                                               |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| Consolidated Balance Sheets                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | As Originally Reported |   |   |   |   |   | As Restated |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | September 30, 2010 |   |   | Adjustments |   |   | September 30,2010 |   |
|   ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |
| Current Assets                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $ | 411,003 |   |   | $ | - |   |   | $ | 411,003 |   |
| Accounts Receivable, net                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   | 5,284,855 |   |   | (1,100,000 | ) |   |   | 4,184,855 |   |
| Inventories                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 7,999,593 |   |   |   | (241,832 | ) |   |   | 7,757,758 |   |
| Prepaid expenses and other                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 136,569 |   |   |   | - |   |   |   | 136.569 |   |
|                                                                   TOTAL CURRENT ASSETS                                  |   |   | 13,832,020 |   |   |   | (1,341,835 | ) |   |   | 12,490,185 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Property and Equipment, net                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 330,499 |   |   |   | - |   |   |   | 330,499 |   |
| Other Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                      TOTAL ASSETS                        |   | $ | 14,162,519 |   |   |   | (1,341,835 | ) |   | $ | 12,820,684 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS' (DEFICIT)                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Current Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts payable                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $ | 6,845,318 |   |   |   | (3,299,562 | ) |   | $ | 3,545,756 |   |
| Product financing - related party                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | - |   |   |   | 3,599,562 |   |   |   | 3,599,562 |   |
| Accrued expenses and other                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 165,684 |   |   |   | - |   |   |   | 165,684 |   |
| Revolvling Line of Credit                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 2,363,285 |   |   |   | - |   |   |   | 2,363,285 |   |
| Note payable - TW development LLC - related party                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | 16,255 |   |   |   | - |   |   |   | 16,255 |   |
|                                                                     TOTAL CURRENT LIABILITES                  |   |   | 9,390,542 |   |   |   | 300,000 |   |   |   | 9,690,542 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Long Term Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                      TOTAL LIABILITIES                   |   |   | 9,390,542 |   |   |   | 300,000 |   |   |   | 9,690,542 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
|  Redeemable preferred stock, Series A                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 674,839 |   |   |   | - |   |   |   | 674,839 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Stockholders' Equity (Deficit)                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |
|  Common stock                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   | 829 |   |   |   | - |   |   |   | 829 |   |
| Additional paid-in capital                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 8,276,016 |   |   |   | (518,627 | ) |   |   | 7,757,389 |   |
| Accumulated deficit                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   | (4,179,707 | ) |   |   | (1,123,208 | ) |   |   | (5,302,915 | ) |
|                                                                      Total stockholders' equity               |   |   | 4,097,138 |   |   |   | (1,641,835 | ) |   |   | 2,455,303 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                      TOTAL LIABILITIES AND STOCKHOLDERS' |   | $ | 14,162,519 |   |   |   | (1,341,835 | ) |   | $ | 12,820,684 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |

----

| Game Trading Technologies, Inc. and Subsidiary               |   |
|--------------------------------------------------------------|--------|
| Consolidated Statements of Operations                        |   |
| (Unaudited)                                                  |   |
|                                                         |   |   |   |   |   |   |   |   |   |
|                                                         |   | For the Three Months Ended September 30 |   |
|                                                         |   | 2010 |   |   |   |   |   | 2010 |   |
|                                                         |   | As Originally Reported |   |   | Adjustments |   |   | As Restated |   |
| Net Sales                                                    |   | $ | 9,105,366 |   |   | $ | (1,100,000 | ) |   | $ | 8,005,366 |   |
| Cost of Sales                                                |   |   | 7,478,508 |   |   |   | 449,017 |   |   |   | 7,927,525 |   |
| Gross Profit                                                 |   |   | 1,626,858 |   |   |   | (1,549,017 | ) |   |   | 77,841 |   |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Expense :                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling, general and administrative                          |   |   | 957,656 |   |   |   | - |   |   |   | 957,656 |   |
| Employee stock based compensation                            |   |   | 410,779 |   |   |   | 41,506 |   |   |   | 452,285 |   |
| Non-employee stock based compensation                        |   |   | - |   |   |   | - |   |   |   | - |   |
| Depreciation                                                 |   |   | 24,501 |   |   |   | - |   |   |   | 24,501 |   |
| Total Operating Expense:                                     |   |   | 1,392,936 |   |   |   | 41,506 |   |   |   | 1,434,442 |   |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (Loss) From Operations                                |   |   | 233,922 |   |   |   | (1,590,523 | ) |   |   | (1,356,601 | ) |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Income (Expense):                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Expense                                             |   |   | (23,206 | ) |   |   | - |   |   |   | (23,206 | ) |
| Other income                                                 |   |   | - |   |   |   |   |   |   |   | - |   |
| Total Other Expense                                          |   |   | (23,206 | ) |   |   | - |   |   |   | (23,206 | ) |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (Loss) From Continuing Operations Before Income Taxes |   |   | 210,716 |   |   |   | (1,590,523 | ) |   |   | (1,379,807 | ) |
| Accretion of preferred dividends                             |   |   | 70,939 |   |   |   | - |   |   |   | 70,939 |   |

| Accretion of preferred amortization of beneficial conversion and warrant features |   |   | 283,749    |   |   | -      |       |   |   | 283,749 |       |
|-----------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|---------|------------|
|                                                                              |   |   |       |   |   |   |       |   |   |    |       |
| Net Income (Loss) attributable to common shareholders                             |   | $      | (143,972   | )      |   | $      | (1,590,523 | )      |   | $       | (1,734,495 | ) |
|                                                                              |   |   |       |   |   |   |       |   |   |    |       |   |
|  Net Income (Loss) per share:                                                |   |   |       |   |   |   |       |   |   |    |       |   |
|                                                                              |   |   |       |   |   |   |       |   |   |    |       |   |
| Income (loss) per share from continuing operations – basic                  |   | $      | 0.03       |   |   |   |       |   |   | $       | (0.17      | ) |
|                                                                              |   |   |       |   |   |   |       |   |   |    |       |   |
|                                                                              |   |   |       |   |   |   |       |   |   |    |       |   |
| Net income (loss) per share – diluted                                       |   | $      | 0.02       |   |   |   |       |   |   | $       | (0.17      | ) |
|                                                                              |   |   |       |   |   |   |       |   |   |    |       |   |
| Weighted average shares outstanding of common stock                               |   |   |       |   |   |   |       |   |   |    |       |   |
| Basic                                                                             |   |   | 8,290,000  |   |   |   |       |   |   |    | 8,290,000  |   |
|                                                                              |   |
| Diluted                                                                           |   |   | 13,770,098 |   |   |   |       |   |   |    | 8,290,000  |   |
|                                                                              |   |

----

| Game Trading Technologies, Inc. and Subsidiary               |   |
|--------------------------------------------------------------|--------|
| Consolidated Statements of Operations                        |   |
| (Unaudited)                                                  |   |
|                                                         |   |
|                                                         |   | For the Nine Months Ended September 30 |   |
|                                                         |   | 2010 |   |   |   |   |   | 2010 |   |
|                                                         |   | As Originally Reported |   |   | Adjustments |   |   | As Restated |   |
| Net Sales                                                    |   | $ | 27,138,605 |   |   | $ | (1,100,000 | ) |   | $ | 26,038,605 |   |
| Cost of Sales                                                |   |   | 22,759,924 |   |   |   | 541,835 |   |   |   | 23,301,759 |   |
| Gross Profit                                                 |   |   | 4,378,681 |   |   |   | (1,641,835 | ) |   |   | 2,736,846 |   |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Expense :                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling, general and administrative                          |   |   | 3,570,980 |   |   |   | - |   |   |   | 3,570,980 |   |
| Employee stock based compensation                            |   |   | 1,728,544 |   |   |   | (602,293 | ) |   |   | 1,126,251 |   |
| Non-employee stock based compensation                        |   |   | 1,496,023 |   |   |   | 83,666 |   |   |   | 1,579,689 |   |
| Depreciation                                                 |   |   | 59,800 |   |   |   | - |   |   |   | 59,800 |   |
| Total Operating Expense:                                     |   |   | 6,855,347 |   |   |   | (518,627 | ) |   |   | 6,336,720 |   |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (Loss) From Operations                                |   |   | (2,476,666 | ) |   |   | (1,123,208 | ) |   |   | (3,599,874 | ) |
|                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Income (Expense):                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Expense                                             |   |   | (106,473 | ) |   |   | - |   |   |   | (106,473 | ) |
| Other income                                                 |   |   | 46,493 |   |   |   | - |   |   |   | 46,493 |   |
| Total Other Expense                                          |   |   | (59,980 | ) |   |   | - |   |   |   | (59,980 | ) |
|                                                         |   |   | - |   |   |   |   |   |   |   |   |   |
| Income (Loss) From Continuing Operations Before Income Taxes |   |   | (2,536,646 | ) |   |   | (1,123,208 | ) |   |   | (3,659,854 | ) |
|                                                         |   |   | - |   |   |   |   |   |   |   | - |   |

| Accretion of preferred dividends and discount                                     |   |   | 155,903    |   |   |   | -          |   |   |   | 155,903    |   |
|-----------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|
| Accretion of preferred amortization of beneficial conversion and warrant features |   |   | 602,915    |   |   |   | -          |   |   |   | 602,915    |   |
|                                                                              |   |   |       |   |   |   |       |   |   |   |       |   |
| Net Income (Loss) attributable to common shareholders                             |   | $      | (3,295,464 | )      |   | $      | (1,123,208 | )      |   | $      | (4,418,672 | )      |
|                                                                              |   |   |       |   |   |   |       |   |   |   |       |   |
|  Net Income (Loss) per share:                                                |   |   |       |   |   |   |       |   |   |   |       |   |
|                                                                              |   |   |       |   |   |   |       |   |   |   |       |   |
| Net income (loss) per share – basic & diluted                           |   | $      | (0.32      | )      |   |   |       |   |   | $      | (0.45      | )      |
|                                                                              |   |   |       |   |   |   |       |   |   |   |       |   |
| Weighted average shares outstanding of common stock                               |   |   |       |   |   |   |       |   |   |   |       |   |
| Basic & Diluted                                                               |   |   | 8,043,846  |   |   |   |       |   |   |   | 8,043,846  |   |

----

| Game Trading Technologies, Inc. and Subsidiary                                                  |   |
|-------------------------------------------------------------------------------------------------|--------|
| Consolidated Statements of Cash Flows                                                           |   |
| (Unaudited)                                                                                     |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                            |   | For the Period Ended September 30, |   |
|                                                                                            |   | 2010 |   |   |   |   |   | 2010 |   |
|  Cash flows from operating activities                                                      |   | As Originally Reported |   |   | Adjustments |   |   | As Restated |   |
|  Net Income (Loss)                                                                         |   | $ | (2,536,646 | ) |   |   | (1,123,208 | ) |   | $ | (3,659,854 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |   |   |   |   |   |   |   |   |   |   |   |   |
|  Depreciation & Amortization  - Property and Equipment                       |   |   | 59,800 |   |   |   | - |   |   |   | 59,800 |   |
|  Issuance of Stock Warrants for Services                                                   |   |   | 1,496,023 |   |   |   | 83,666 |   |   |   | 1,579,689 |   |
|  Stock Options for employee services                                                       |   |   | 1,728,544 |   |   |   | (602,293 | ) |   |   | 1,126,251 |   |
|  Other                                                                                     |   |   | 12,317 |   |   |   | - |   |   |   | 12,317 |   |
| Changes in assets and liabilities                                                               |   |   |   |   |   |   |   |   |   |   |   |   |
|  Account receivable                                                                        |   |   | (2,901,167 | ) |   |   | 1,100,000 |   |   |   | (1,801,167 | ) |
| Inventory                                                                                       |   |   | (5,102,161 | ) |   |   | 241,835 |   |   |   | (4,860,326 | ) |
|  Accounts payable                                                                          |   |   | 2,591,922 |   |   |   | (3,299,562 | ) |   |   | (707,640 | ) |
|  Accrued liabilities                                                                       |   |   | 105,149 |   |   |   | - |   |   |   | 105,149 |   |
|  Deferred Expenses                                                                         |   |   | 9,801 |   |   |   | - |   |   |   | 9,801 |   |
|  Prepaid expenses and deposits                                                             |   |   | (136,568 | ) |   |   | - |   |   |   | (136,568 | ) |
|  Liabilities of discontinued operation                                                     |   |   | (88,921 | ) |   |   | - |   |   |   | (88,921 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net Cash Provided (Used) In Operating Activities                                          |   |   | (4,761,907 | ) |   |   | (3,599,562 | ) |   |   | (8,361,469 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash flows from investing activities                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
|  Purchases of fixed assets                                                                 |   |   | (280,315 | ) |   |   | - |   |   |   | (280,315 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net Cash Provided (Used) In Investing Activities                                          |   |   | (280,315 | ) |   |   | - |   |   |   | (280,315 | ) |
|  Cash flows from financing activities                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from the sale of convertible preferred stock                                           |   |   | 5,675,000 |   |   |   | - |   |   |   | 5,675,000 |   |
| Net borrowings (repayment) in connection with Product financing facilities                      |   |   | - |   |   |   | 3,599,562 |   |   |   | 3,599,562 |   |
| Increase (Decrease) in working line of credit                                                   |   |   | 2,363,285 |   |   |   | - |   |   |   | 2,363,285 |   |
| Payments on Series A Preferred Dividends                                                        |   |   | (83,979 | ) |   |   | - |   |   |   | (83,979 | ) |
| Issuance (Repayment) of note payable - related party                                            |   |   | (392,169 | )  |   |   | - |   |   |   | (392,169 | ) |
| Issuance (Repayment) of note payable                                                            |   |   | (2,750,000 | ) |   |   | - |   |   |   | (2,750,000 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net Cash Provided (Used) In Financing Activities                                          |   |   | 4,812,137 |   |   |   | 3,599,562 |   |   |   | 8,411,699 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net increase (decrease) in cash                                                           |   |   | (230,085 | ) |   |   |   |   |   |   | (230,085 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash and cash equivalents at the beginning of the period                                  |   |   | 641,088 |   |   |   |   |   |   |   | 641,088 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash and cash equivalents at the end of the period                                        |   | $ | 411,003 |   |   |   |   |   |   | $ | 411,003 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |

----

|                            |
|---------------------------------|
|                            |    | 9/30/10 |   |    | 12/31/09 |   |
| Machinery and equipment         |    | $ | 522,375 |    |    | $ | 251,347 |    |
| Leasehold improvements          |    |   | 16,653 |    |    |   | 19,483 |    |
| Computer equipment and software |    |   | 154,340 |    |    |   | 142,223 |    |
|                            |    |   |   |   |    |   |   |   |
|                            |    | $ | 693,368 |    |    | $ | 413,053 |    |
| Less accumulated depreciation   |    |   | 362,869 |    |    |   | 303,069 |    |
|                            |    |   |   |   |    |   |   |   |
| Property and Equipment, net     |    | $ | 330,499 |    |    | $ | 109,984 |    |

----

|                          |         |    |                |         |         |   |      |         |
|-------------------------------|--------------|---------|---------------------|--------------|--------------|--------|-----------|--------------|
|                          |    | 9/30/10 |                |    | 12/31/09     |   |
| Allegiance Capital Limited    |    | $       | —   |    |    | $      | 700,000   |    |
| The Columbia Bank             |    |    | —   |    |    |   | 1,800,000 |    |
| Vision Capital Advisors, Ltd. |    |    | —   |    |    |   | 250,000   |    |
|                          |    |    |                |         |    |   |      |         |
|                          |    | $       | —   |    |    | $      | 2,750,000 |    |
| Less: Current Portion         |    |    | —   |    |    |   | 513,046   |    |
|                          |    |    |                |         |    |   |      |         |
| Notes Payable                 |    | $       | —   |    |    | $      | 2,236,954 |    |

----

|                                                                                                                                                            |   | 9/30/10 |       |    | 12/31/09 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|------------|---------|----------|--------|
| Redeemable preferred stock, Series A                                                                                                                            |   | $       | 5,675,000  |    |     | $      | - |   |
| Beneficial conversion feature, net of accumulated amortization of $220,795and $0 at September 30, 2010 and December 31, 2009, respectively.                     |   |    | (1,846,598 | )  |     |   | - |   |
| Value attributable to warrants attached to notes, net of accumulated amortization of $382,120 and $0 at September 30, 2010 and December 31, 2009, respectively. |   |    | (3,225,487 | )  |     |   | - |   |
| Accumulated Dividends                                                                                                                                           |   |    | 71,924     |    |     |   | - |   |
|                                                                                                                                                            |   | $       | 674,839    |    |     | $      | - |   |

|   | • |   | liquidation preferences (120% of stated value); |
|--------|---------|--------|-------------------------------------------------|

|   | • |   | dividend preferences; |
|--------|---------|--------|-----------------------|

----

|   | • |   | The parties agreed to add a provision to the certificate of designation for the Series A Preferred Stock whereby the minimum price in which the conversion price of the Series A Preferred Stock may be reduced shall be equal to $1.00; |
|--------|---------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | The parties agreed to add a provision to the Warrants whereby the minimum price in which the exercise price of the Warrants may be reduced shall be equal to $1.00; |
|--------|---------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | The parties agreed to add a provision to the Purchase Agreement whereby until the 36 month anniversary of the date of the Purchase Agreement, the Company shall not issue any of its equity securities below $1.00 without the prior written consent of any holder who was issued a Warrant for an aggregate of 2% or more of the Warrants initially issued pursuant to the Purchase Agreement. |
|--------|---------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                        |
|-----------------------------|
| Range ofExercisePrices |   |    | NumberOutstanding |   |    | WeightedAverageExercisePrice |   |    | WeightedAverageRemainingContractualLife |   |    | NumberExercisable |   |    | WeightedAverageExercisePrice |   |
| $                           | 2.25 |    |    |   | 1,000,000 |    |    | $ | 2.25 |    |    |   | 4.41 |    |    |   | - |   |    | $ | 2.25 |    |
|                        | 2.50 |    |    |   | 275,000 |    |    |   | 2.50 |    |    |   | 4.89 |    |    |   | 91,666 |    |    |   | 2.50 |    |
|                        | 4.60 |    |    |   | 100,000 |    |    |   | 4.60 |    |    |   | 4.44 |    |    |   | 33,334 |    |    |   | 4.60 |    |
|                        | 4.75 |    |    |   | 60,000 |    |    |   | 4.75 |    |    |   | 4.56 |    |    |   | 20,000 |    |    |   | 4.75 |    |
|                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |
|                        |   |   |    |   | 1,435,000 |    |    |   |   |   |    |   | 4.51 |    |    |   | 145,000 |   |    |   |   |   |
|                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |

|                                 |
|--------------------------------------|
|                                 |    | Optionsand  Warrants |   |    | WeightedAverageExercisePrice |   |
| Outstanding, December 31, 2009  |    |   | —   |    |    | $ | —   |    |
| Granted                              |    |   | 1,435,000 |    |    |   | 2.57 |    |
| Exercised                            |    |   | —   |    |    |   | —   |    |
| Expired/Cancelled                    |    |   | —   |    |    |   | —   |    |
| Outstanding, September 30, 2010 |    |   | 1,435,000 |    |    |   | 2.57 |    |
|                                 |    |   |   |   |    |   |   |   |
| Exercisable, September 30, 2010 |    |   | 145,000 |    |    | $ | 2.57 |    |
|                                 |    |   |   |   |    |   |   |   |

|                                        |
|---------------------------------------------|
|                                        |    | September 30,2010 |   |
| Significant assumptions (weighted-average): |    |   |   |   |
| Risk-free interest rate at grant date       |    |   | 1.31  | %  |
| Expected stock price volatility             |    |   | 74  | % |
| Expected dividend payout                    |    |   | —   |    |
| Expected option life (in years)             |    |   | 5.0 |   |
| Expected forfeiture rate                    |    |   | 0 | %  |
|                                        |    |   |   |   |
| Fair value per share of options granted     |    | $ | 3.07 |   |
|                                        |    |   |   |   |

----

|                         |
|------------------------------|
| Range  ofExercisePrices |   |    | NumberOutstanding |   |    | WeightedAverageExercisePrice |   |    | WeightedAverageRemainingContractualLife |   |    | NumberExercisable |   |    | WeightedAverageExercisePrice |   |
| $                            | 0.65 |    |    |   | 1,120,000 |    |    | $ | .65 |    |    |   | 3.28 |    |    |   | 1,120,000 |    |    | $ | .65 |    |
|                         | 2.50 |    |    |   | 2,927,500 |    |    |   | 2.50 |    |    |   | 4.41 |    |    |   | 2,927,500 |    |    |   | 2.50 |    |
|                         |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |
|                         |   |   |    |   | 4,047,500 |    |    |   |   |   |    |   | 3.99 |    |    |   | 4,047,500 |    |    |   |   |   |
|                         |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |

|                                 |
|--------------------------------------|
|                                 |    | Optionsand  Warrants |   |   | WeightedAverageExercisePrice |   |
| Outstanding, December 31, 2009  |    |   | 1,110,000 |    |   | $ | 0.65 |    |
| Granted                              |    |   | 3,237,500 |    |   |   | 2.50 |    |
| Exercised                            |    |   | —   |    |   |   | —   |    |
| Expired/Cancelled                    |    |   | (300,000 | )  |   |   | 0.65 |    |
| Outstanding, September 30, 2010 |    |   | 4,047,500 |    |   |   | 1.99 |    |
|                                 |    |   |   |   |   |   |   |   |
| Exercisable, September 30, 2010 |    |   | 4,047,500 |    |   |   | 1.99 |    |

----

----

|                          |         |   |      |         |
|-------------------------------|--------------|--------|-----------|--------------|
| Year Ending December 31: |    |   |      |
| 2010 (remainder of the year)  |    | $      | 48,345    |    |
| 2011                          |    |   | 221,670   |    |
| 2012                          |    |   | 228,470   |    |
| 2013                          |    |   | 234,969   |    |
| 2014 and thereafter           |    |   | 1,036,189 |    |
|                          |    |   |      |         |
|                          |    | $      | 1,769,643 |    |
|                          |    |   |      |         |

----

|  Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|--------------------|---------------------------------------------------------------------------------------------|

----

|   | • |   | The parties agreed to add a provision to the certificate of designation for the Series A Preferred Stock whereby the minimum price that the conversion price of the Series A Preferred Stock may be reduced shall be equal to $1.00; |
|--------|---------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | The parties agreed to add a provision to the Warrants whereby the minimum price that the exercise price of the Warrants may be reduced shall be equal to $1.00; and |
|--------|---------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | The parties agreed to add a provision to the Purchase Agreement whereby until the 36 month anniversary of the date of the Purchase Agreement, the Company shall not issue any of its equity securities below $1.00 without the prior written consent of any holder who was issued a Warrant for an aggregate of 2% or more of the Warrants initially issued pursuant to the Purchase Agreement. |
|--------|---------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|          |
|---------------|
|          |    | Three months ended September 30, |   |
|          |    | 2010 |   |   | 2009 |   |   | Variance |   |
| Revenue       |    | $ | 8,005,366 |    |    |   | 100  | %  |   | $ | 6,527,744 |    |    |   | 100  | %  |   | $ | 1,477,622 |    |    |   | 23  | %  |
| Cost of Sales |    |   | 7,927,525 |    |    |   | 99  | %  |   |   | 5,145,000 |    |    |   | 79  | %  |   |   | 2,782,525 |    |    |   | 54  | %  |
|          |    |   |   |   |    |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |    |   |   |   |
| Gross Profit  |    | $ | 77,841 |    |    |   | 1  | %  |   | $ | 1,382,744 |    |    |   | 21  | %  |   | $ | (1,304,903 | ) |    |   | -94  | %  |
|          |    |   |   |   |    |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |    |   |   |   |

|          |
|---------------|
|          |    | Nine months ended September 30, |   |
|          |    | 2010 |   |   | 2009 |   |   | Variance |   |
| Revenue       |    | $ | 26,038,605 |    |    |   | 100  | %  |   | $ | 27,867,603 |    |    |   | 100  | %  |   | $ | (1,828,998 | )  |   |   | -7  | %  |
| Cost of Sales |    |   | 23,301,759 |    |    |   | 90  | %  |   |   | 23,212,718 |    |    |   | 83  | %  |   |   | 89,041 |   |   |   | 0  | %  |
|          |    |   |   |   |    |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |   |   |
| Gross Profit  |    | $ | 2,736,846 |    |    |   | 10  | %  |   | $ | 4,654,885 |    |    |   | 17  | %  |   | $ | (1,918,039 | )  |   |   | -41  | %  |
|          |    |   |   |   |    |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |   |   |

----

----

|   | • |   | Accounts receivable increased in the amount of $ 1,801,167 |
|--------|---------|--------|------------------------------------------------------------|

|   | • |   | Inventory increased $4,860,326 for purchases of inventory |
|--------|---------|--------|-----------------------------------------------------------|

|   | • |   | Accounts payable decreased in the amount of $707,640 |
|--------|---------|--------|------------------------------------------------------|

|   | • |   | An increase Poduct Financing - related party advances of $3,599,562 |
|--------|---------|--------|---------------------------------------------------------------------|

|   | • |   | An increase financing net proceeds from the Bank of America working line of credit of $2,363,285 |
|--------|---------|--------|--------------------------------------------------------------------------------------------------|

|   | • |   | Decreased from repayment of current notes payable of $513,046 and related party notes of $392,169 |
|--------|---------|--------|---------------------------------------------------------------------------------------------------|

----

|  Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
|--------------------|------------------------------------------------------------|

|  Item 4. |   Controls and Procedures |
|--------------------|--------------------------------|

| ● | The Company did not have sufficient oversight to ensure financial reporting, proper disclosures around related-party transactions or dissemination of the Company’s policies and procedures.                                                                                                                                                                                                                                                                                 |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ● | The Company did not maintain effective controls over the period-end financial reporting process, including controls and supporting documentation with respect to journal entries, account reconciliations and proper segregation of duties.                                                                                                                                                                                                                                        |
| ● | The Company did not implement proper segregation of duties. In certain instances, persons responsible to review transactions for validity, completeness and accuracy were also responsible for preparation.                                                                                                                                                                                                                                                                        |
| ● | The Company’s stock option vesting determination was inaccurately established in February 2010 and warrant and stock option methodology was inconsistent with guidance.                                                                                                                                                                                                                                                                                                      |
| ● | The Company did not maintain effective controls within the inventory function, including purchasing, receiving, returns, physical inventory and obsolescence analysis.                                                                                                                                                                                                                                                                                                             |
| ● | The Company did not develop and maintain effective general computer controls, including use of a financial application and inventory management system that lack sufficient internal controls, ensuring proper security access within the financial and inventory management applications, ensuring proper change management procedures were followed, and ensuring adequate information technology procedures were followed in accordance with generally accepted best practices. |
| ● | The Company failed to maintain effective controls within the revenue function, including monitoring major sales contracts to ensure revenue recognition criteria were identified and properly monitored to ensure revenue was recognized, inventory was relieved, and accounts receivable and cost of goods sold were recorded in the correct period.                                                                                                                              |

----

| ● | Prior to filing this First Amendment, we designed and are implementing robust corporate governance including: (1) direct oversight of our internal controls by the Audit Committee of our Board of Directors; (2) detailed review of our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q by the Audit Committee of our Board of Directors; (3) adoption and communication of our Code of Business Conduct and Ethics; (4) adoption and communication of our Policy on Insider Trading; (5) revision of policies within our employee handbook to ensure that appropriate disciplinary actions may be taken in the event an employee fails to properly perform their responsible internal controls or intentionally overrides any internal control and completion of employee training on the policy revisions; (6) adoption of charters for our Audit, Compensation, Governance and Nominating Committees of our Board of Directors; (7) adoption of our Whistleblower Policy, which includes our anonymous reporting system; and (8) adoption of our policy on reporting and investigating complaints regarding accounting, internal accounting controls or auditing matters and concerns regarding questionable accounting or auditing matters. |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ● | In September 2010, we hired a Chief Financial Officer with considerable public company reporting experience who is evaluating the depth and breadth of knowledge of US GAAP and external reporting requirements among the current members of the accounting staff. We are committed to establishing procedures and utilizing experienced individuals with professional supervision to properly segregate duties, prepare and approve the consolidated financial statements and footnote disclosures in accordance with US GAAP.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| ● | Prior to filing this First Amendment, we improved our financial reporting and inventory and revenue procedures in financial reporting and in inventory and in revenue cycles and continue to implement fundamental controls aligned with our business strategy. There is a specific focus on customer contracts, revenue recognition and enhancing 3rd party shipper reporting requirements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| ● | Prior to filing this First Amendment, we enhanced our stock option and warrant valuation procedures to incorporate a comparative analysis of firms similar to ours that have significant stock trading history.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| ● | The Board of Directors is more actively involved in providing additional oversight of the Company’s internal controls, formal review of our financial statements, and more detailed review of the draft periodic reports we anticipate filing with the SEC.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| ● | We have initiated efforts to ensure our employees understand the importance of internal controls and compliance with corporate policies and procedures. We will implement a reporting and certification process for management involved in the performance of internal controls and preparation of the Company’s financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| ● | We will design and implement a formalized financial reporting process that includes balance sheet reconciliations, properly prepared, supported and reviewed journal entries, properly segregated duties, and properly completed and approved close checklist and calendar.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| ● | We will initiate a formal feasibility assessment for implementing a compliant ERP system to replace our current financial software application and inventory management system during our current fiscal year. As part of this assessment, we will thoroughly review the roles and responsibilities of our staff involved in the performance of our financial close process and other internal controls to ensure duties are properly segregated, access rights within our new financial software application comply with designated roles and responsibilities and support the proper segregation of duties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| ● | The Company may retain third party specialists to assist us in the design, implementation and testing of our internal controls as necessary.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

----

|  Item 1. | Legal Proceedings |
|--------------------|-------------------|

|  Item 1A. | Risk Factors |
|---------------------|--------------|

|  Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
|--------------------|-------------------------------------------------------------|

|  Item 3. | Defaults Upon Senior Securities |
|--------------------|---------------------------------|

|  Item 4. | Removed and Reserved |
|--------------------|----------------------|

|  Item 5. | Other Information |
|--------------------|-------------------|

|  Item 6. | Exhibits |
|--------------------|----------|

|   |         |                                                                                                                                                                           |
|--------|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Number |    | Description                                                                                                                                                                    |
|   |         |
| 31.1   |    | Certification as Adopted Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 by Chief Executive Officer.                                                              |
|   |         |
| 31.2   |    | Certification as Adopted Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 by Chief Financial Officer.                                                              |
|   |         |
| 32.1   |    | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Chief Executive Officer and Chief Financial Officer. |

----

|                 |
|----------------------|
|                 |   |   |   | GAME TRADING TECHNOLOGIES, INC. |
|                 |   |   |   |
| Date: April 20, 2011 |   |   |   | By: |   | / S / T ODD H AYS         |
|                 |   |   |   | Name: |   | Todd Hays |
|                 |   |   |   | Title: |   | Chairman & Chief Executive Officer(Principal Executive Officer) |
|                 |   |   |   |
| Date: April 20, 2011 |   |   |   | By: |   | / S / R ICHARD L EIMBACH         |
|                 |   |   |   | Name: |   | Richard Leimbach |
|                 |   |   |   | Title: |   | Chief Financial Officer(Principal Financial and Accounting Officer) |