SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 26, 1998
American Gaming & Entertainment, Ltd.
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(Exact Name of Registrant as Specified in Charter)
Delaware
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(State or Other Jurisdiction of
Incorporation or Organization)
0-19049 74-2504501
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(Commission (IRS Employer
File Number) Identification No.)
One Woodland Avenue, Paramus, New Jersey 07652
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (609) 822-8505
Not Applicable
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(Former Name, Address and Former Fiscal Year, if Changed Since Last Report)
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American Gaming & Entertainment, Ltd.
SEC Form 8-K
Item 5. Other Events
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As previously disclosed in the Company's Annual Report on Form 10-KSB for the
year ended December 31, 1996, IGT - North America ("IGT") is not receiving any
payments from AMGAM Associates ("AMGAM"), a wholly-owned subsidiary of the
Company currently in bankruptcy, on AMGAM's debt to IGT for certain slot
machines under an installment sales contract. Such indebtedness by AMGAM to
IGT has been guaranteed by the Company pursuant to a guaranty agreement (the
"IGT Guaranty") by the Company to IGT. On November 2, 1995 IGT filed a
complaint against the Company in the Circuit Court of Harrison County,
Mississippi, Second Judicial District seeking a judgment against the Company
under the IGT Guaranty of (i) the principal amount of approximately $3,306,000
plus accrued interest and (ii) reasonable attorneys fees. The Company
responded to such complaint by arguing that the IGT Guaranty should be found
to be unenforceable if IGT has failed to properly perfect a security interest
in such slot machines. As previously disclosed in the Company's Quarterly
Report on Form 10-QSB for the period ended September 30, 1997, on October 13,
1997 the Company paid IGT $375,000, which amount had been previously accrued,
to settle such lawsuit.
IGT has alleged that such settlement was contingent on the Company and
Shamrock Holdings Group, Inc., the Company's major stockholder and creditor,
and related entities (collectively, "Shamrock") waiving any claim to payments
made by President Mississippi Charter Corporation to AMGAM relating to the
purchase of IGT slot machines from AMGAM. At the time the Company filed its
Quarterly Report on Form 10-QSB for the period ended September 30, 1997, the
Company believed that Shamrock would waive such claim. However, as of May 26,
1998, Shamrock had refused to waive such claim. On May 26, 1998, IGT filed a
motion for summary judgment in the Circuit Court of Harrison County,
Mississippi, Second Judicial District seeking a judgment against the Company
under the IGT Guaranty of (i) the principal amount of approximately $3,306,000
plus accrued interest of approximately $864,000 and (ii) attorneys fees of
approximately $108,000. To the extent (i) funds are not paid to IGT pursuant
to a plan of liquidation in the bankruptcy proceeding of AMGAM and (ii) the
IGT Guaranty is enforceable against the Company, the Company's business and
financial condition would be materially adversely affected. Management is
unable, with any degree of certainty, to predict the outcome, or to estimate
the amount of liability, if any, that may result from this action.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
American Gaming & Entertainment, Ltd.
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(Registrant)
DATE: June 2, 1998 By: /s/ J. Douglas Wellington
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J. DOUGLAS WELLINGTON
President and Chief Executive
Officer and Principal Accounting
Officer
