AWI Gaming Obtains Financing - Wednesday 4th of January 2006
LAS VEGAS – American Wagering, Inc. (OTC Bulletin Board: BETM) today announced that AWI Gaming, Inc. ("AWIG"), a wholly owned subsidiary of the Company, has obtained a financing commitment for the acquisition of Sturgeon's Inn & Casino in Lovelock, Nevada ("Sturgeon's"). The proceeds of the financing, which will be secured by a 1st Deed of Trust on the Sturgeon's property, will be used by AWIG to complete the acquisition, subject to approval of Nevada gaming regulators.
The financing commitment is provided by Millennium Bank (Edwards, Colorado). The terms of the commitment are:
Borrower: AWI Gaming, Inc. Guarantor: American Wagering, Inc. Facility: Interest-only commercial loan Loan Amount: $1,100,000 Rate: Wall Street Journal listed prime plus 2.0% floating daily Term: 2 years from date of closing Collateral: 1st Deed of Trust on Sturgeon's Inn & Casino Closing Date: 1st day of the month following Nevada Gaming Commission approval of the acquisition Prepayment Penalty: None Closing Costs: Normal closing costs and out-of- pocket expenses including, but not limited to, title insurance, flood certificate, tax certificate, credit report, appraisal fee, recording fees, release fees and loan origination fee of 2% The loan is subject to the following conditions prior to closing: * Acceptable appraisal of Sturgeon's Inn & Casino * Executed documents by AWIG and the participant bank (Great Basin Bank of Nevada) * Nevada Gaming Commission approval of the acquisition * Title commitment policy for $1,100,000 identifying Millennium Bank in first lien position
The Company cannot predict when the Nevada gaming regulators will complete their investigation and allow the Sturgeon's acquisition to close, but the Company is hopeful the closing will occur in the first quarter of the Company's next fiscal year.
"We are pleased to obtain this financial commitment from Millennium Bank," stated Bruce Dewing, President of AWIG. "With this financing, we are establishing a strong business relationship with a banking institution capable of servicing our current needs as well as cultivating a source of possible financing for potential future acquisitions."
Victor Salerno, CEO of the Company said, "After evaluating various options over the past several months, we believe this financing structure is more favorable than others we have explored given the needs of our business at this time. This financing, secured by a first mortgage on the property, will not dilute the shareholders' stake in the Company as might be the case with traditional equity financing."
Mr. Salerno continued, "We believe the structure of this financing gives us maximum flexibility as we approach the closing of the Sturgeon's Inn & Casino acquisition, allowing us to conserve our existing cash resources for possible future acquisitions and expansions. We believe this financing is an important endorsement of the progress the Company has made and a vote of confidence in our business model. Our management team remains dedicated to our long-term operating strategies and we are optimistic about meeting our goals of strengthening and diversifying cash flows, growing the Company and increasing shareholder value in the long term."
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