American Wagering offered Loan if it receives Delaware contract

Jul 14, 2009 5:04 PM
by Ray Poirier | Cash-starved American Wagering Inc. (BETM.OB), better known in Las Vegas as Leroy’s, has an oral commitment for a loan from an "unidentified third party," provided it is successful in its pursuit of the Sports Lottery contract from the State of Delaware.

Delaware lawmakers have approved sports betting in that state with the Lottery expected to conduct the sports wagering at the state’s three horse tracks. A format for wagering has not been officially established but it’s expected to involve parlays of two to 12 football teams, similar to the wagers offered on Las Vegas parlay cards.

This is a procedure that is very familiar to American Wagering since one of its divisions, Computerized Bookmaking Systems Inc. (CBS), provides most of the ticket-issuing machines used in Nevada.

American wagering has been on the losing end of a lawsuit, identified as the Racusin Litigation, and expects an adverse court ruling soon. In order to appeal the ruling, the company will need sufficient cash to post a bond, thus the announcement of an oral commitment.

In an SEC filing, the company said that if the loan is granted it will be secured by a pledge of shares of the company’s common stock held by president and CEO Vic Salerno. In the past year, Salerno has loaned the company some $1 million from his personal funds.

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