##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED
June 30, 2008
 Commission File Number: 0-26015
 YOUBET.COM, INC.
  Delaware
(State or other jurisdiction 
of incorporation or organization)
    
    95-4627253
(I.R.S. Employer
Identification No.)
 5901 De Soto Avenue
Woodland Hills, California 91367
 (818) 668-2100
  þ o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
  o þ




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##### 



YOUBET.COM, INC.
INDEX TO FORM 10-Q
FOR THE QUARTER ENDED
June 30, 2008
 PagePART I. FINANCIAL INFORMATIONItem 1. Condensed consolidated financial statements:Balance sheets as of June 30, 2008 (unaudited) and December 31, 2007
    
    
    2Statements of operations for the three months ended June 30, 2008 and 2007 (unaudited)
    
    
    3Statements of cash flows for the three months ended June 30, 2008 and 2007 (unaudited)
    
    
    4Notes to unaudited financial statements
    
    
    5Item 2. Managements discussion and analysis of financial condition and results of operations
    
    
    14Item 3. Quantitative and qualitative disclosures about market risk
    
    
    20Item 4. Controls and procedures
    
    
    20PART II. OTHER INFORMATIONItem 1. Legal proceedings
    
    
    20Item 1A. Risk factors
    
    
    20Item 2. Unregistered sales of equity securities and use of proceeds
    
    
    20Item 3. Defaults upon senior securities
    
    
    20Item 4. Submission of matters to a vote of security holders
    
    
    20Item 5. Other information
    
    
    21Item 6. Exhibits
    
    
    22Exhibit 10.7Exhibit 31.1Exhibit 31.2Exhibit 32.1
  Preliminary Note




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Part I. Financial Information
 
 Item 1. Condensed Consolidated Financial Statements
 YOUBET.COM, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (in thousands, except share amounts)
 June 30,
    
    
    December 31,2008
    
    
    2007(unaudited)ASSETSCurrent assetsCash and cash equivalents
    
    $
    10,411
    
    
    $
    6,551Current portion of restricted cash
    
    
    4,654
    
    
    
    8,635Accounts receivable, net
    
    
    3,768
    
    
    
    7,314Inventories
    
    
    1,988
    
    
    
    2,085Prepaid expenses and other current assets
    
    
    1,281
    
    
    
    1,41722,102
    
    
    
    26,002Property and equipment, net
    
    
    22,204
    
    
    
    24,664Intangibles assets other than goodwill, net
    
    
    6,134
    
    
    
    6,505Goodwill
    
    
    6,859
    
    
    
    6,859Other assets
    
    
    813
    
    
    
    1,020$
    58,112
    
    
    $
    65,050LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesCurrent portion of long-term debt
    
    $
    12,373
    
    
    $
    10,390Trade payables
    
    
    7,321
    
    
    
    10,028Accrued expenses
    
    
    10,483
    
    
    
    11,346Customer deposits
    
    
    4,250
    
    
    
    8,326Deferred revenues
    
    
    179
    
    
    
    21234,606
    
    
    
    40,302Long-term debt, net of current portion
    
    
    217
    
    
    
    4,76734,823
    
    
    
    45,069Stockholders equityPreferred stock, $0.001 par value,
authorized 1,000,000 shares, none
outstandingCommon stock, $0.001 par value, authorized
100,000,000 shares,
42,562,805 and 42,562,805 shares issued
    
    
    43
    
    
    
    43Additional paid-in-capital
    
    
    134,850
    
    
    
    134,286Accumulated other comprehensive loss
    
    
    (102
    )
    
    
    (56
    )Deficit
    
    
    (109,183
    )
    
    
    (111,973
    )Less treasury stock, 1,043,781 shares at cost
    
    
    (2,319
    )
    
    
    (2,319
    )23,289
    
    
    
    19,981$
    58,112
    
    
    $
    65,050
 The accompanying notes are an integral part of these condensed consolidated financial statements.
  2




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YOUBET.COM, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (UNAUDITED)
(in thousands, except pershare amounts)
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007RevenuesCommissions
    
    $
    21,792
    
    
    $
    25,303
    
    
    $
    40,214
    
    
    $
    47,675Contract revenues
    
    
    6,292
    
    
    
    6,606
    
    
    
    11,463
    
    
    
    11,791Equipment sales
    
    
    333
    
    
    
    394
    
    
    
    498
    
    
    
    514Other
    
    
    822
    
    
    
    971
    
    
    
    1,575
    
    
    
    1,88629,239
    
    
    
    33,274
    
    
    
    53,750
    
    
    
    61,866Costs and expensesTrack fees
    
    
    10,199
    
    
    
    11,017
    
    
    
    18,476
    
    
    
    21,278Licensing fees
    
    
    2,378
    
    
    
    5,617
    
    
    
    4,476
    
    
    
    8,440Contract costs
    
    
    3,859
    
    
    
    4,305
    
    
    
    7,395
    
    
    
    8,065Equipment costs
    
    
    142
    
    
    
    121
    
    
    
    230
    
    
    
    209Network costs
    
    
    983
    
    
    
    1,234
    
    
    
    1,908
    
    
    
    2,43717,561
    
    
    
    22,294
    
    
    
    32,485
    
    
    
    40,429Gross profit
    
    
    11,678
    
    
    
    10,980
    
    
    
    21,265
    
    
    
    21,437Operating expensesGeneral and administrative
    
    
    4,983
    
    
    
    4,429
    
    
    
    9,179
    
    
    
    9,433Sales and marketing
    
    
    1,160
    
    
    
    3,598
    
    
    
    2,403
    
    
    
    5,739Research and development
    
    
    934
    
    
    
    826
    
    
    
    1,796
    
    
    
    1,691Depreciation and amortization,
including intangibles
    
    
    1,972
    
    
    
    2,149
    
    
    
    3,779
    
    
    
    3,7679,049
    
    
    
    11,002
    
    
    
    17,157
    
    
    
    20,630Income (loss) from continuing operations before other income
(expense) and income tax (benefit)
    
    
    2,629
    
    
    
    (22
    )
    
    
    4,108
    
    
    
    807Other income (expense)Interest income
    
    
    48
    
    
    
    185
    
    
    
    117
    
    
    
    384Interest expense
    
    
    (318
    )
    
    
    (562
    )
    
    
    (672
    )
    
    
    (1,019
    )Other
    
    
    (73
    )
    
    
    8
    
    
    
    (65
    )
    
    
    19Income (loss) from continuing operations before income tax
(benefit)
    
    
    2,286
    
    
    
    (391
    )
    
    
    3,488
    
    
    
    191Income tax (benefit)
    
    
    57
    
    
    
    (18
    )
    
    
    76
    
    
    
    (248
    )Net income (loss) from continuing operations
    
    
    2,229
    
    
    
    (373
    )
    
    
    3,412
    
    
    
    439Discontinued operationsIncome (loss) from discontinued
operations, without tax effect
    
    
    (213
    )
    
    
    16
    
    
    
    (622
    )
    
    
    790Net income (loss)
    
    $
    2,016
    
    
    $
    (357
    )
    
    $
    2,790
    
    
    $
    1,229Basic income (loss) per shareIncome (loss) from continuing
operations
    
    $
    0.05
    
    
    $
    (0.01
    )
    
    $
    0.08
    
    
    $
    0.01Income (loss) from discontinued
operations
    
    
    0.00
    
    
    
    0.00
    
    
    
    (0.01
    )
    
    
    0.02Net income (loss) per common share
    
    
    0.05
    
    
    
    (0.01
    )
    
    
    0.07
    
    
    
    0.03Diluted income (loss) per shareIncome (loss) from continuing
operations
    
    $
    0.05
    
    
    $
    (0.01
    )
    
    $
    0.08
    
    
    $
    0.01Income (loss) from discontinued
operations
    
    
    0.00
    
    
    
    0.00
    
    
    
    (0.01
    )
    
    
    0.02Net income (loss) per common share
    
    
    0.05
    
    
    
    (0.01
    )
    
    
    0.07
    
    
    
    0.03Weighted average shares outstandingBasic
    
    
    41,519,024
    
    
    
    42,052,084
    
    
    
    41,519,024
    
    
    
    41,874,498Diluted
    
    
    41,987,398
    
    
    
    42,052,084
    
    
    
    41,951,478
    
    
    
    43,032,182
 The accompanying notes are an integral part of these condensed consolidated financial statements.
  3




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YOUBET.COM, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (UNAUDITED)
(in thousands)
 Six Months EndedJune 30,2008
    
    
    2007Operating activitiesNet income
    
    $
    2,790
    
    
    $
    1,229Income (loss) from discontinued operations
    
    
    (622
    )
    
    
    790Income from continuing operations
    
    
    3,412
    
    
    
    439Adjustments to reconcile income from continuing operations to net cash provided by operating
activities, continuing operationsDepreciation and amortization of property
    
    
    3,408
    
    
    
    3,396Amortization of intangibles
    
    
    371
    
    
    
    371Stock-based compensation
    
    
    564
    
    
    
    369Provision for doubtful accounts receivables
    
    
    575
    
    
    
    280Increase in operating (assets) and liabilities
    
    
    3,108
    
    
    
    (2,010
    )Net cash provided by operating activities,
continuing operations
    
    
    11,438
    
    
    
    2,845Investing activitiesPurchase of property and equipment
    
    
    (607
    )
    
    
    (2,115
    )Cash paid for United Tote Company (make-whole)
    
    
    
    
    
    
    (4,473
    )Increase in restricted cash (other than Players TrustSM)
    
    
    (5
    )Decrease in restricted cash (other than Players TrustSM)
    
    
    
    
    
    
    106Other
    
    
    34Net cash used in investing activities
    
    
    (578
    )
    
    
    (6,482
    )Financing activitiesProceeds from exercise of stock options and warrants
    
    
    
    
    
    
    334Proceeds from debt
    
    
    490
    
    
    
    2,259Repayment of debt
    
    
    (3,528
    )
    
    
    (3,792
    )Proceeds from sale-leaseback transaction
    
    
    
    
    
    
    1,065Other
    
    
    
    
    
    
    (88
    )Net cash used in financing activities
    
    
    (3,038
    )
    
    
    (222
    )Net cash provided by (used in) operating activities, discontinued operations
    
    
    (3,916
    )
    
    
    1,049Foreign currency translation adjustments
    
    
    (46
    )
    
    
    6Net increase (decrease) in cash and cash equivalents
    
    
    3,860
    
    
    
    (2,804
    )Cash and cash equivalents at the beginning of period
    
    
    6,551
    
    
    
    21,051Cash and cash equivalents at the end of period
    
    $
    10,411
    
    
    $
    18,247
 The accompanying notes are an integral part of these condensed consolidated financial statements.
  4




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YOUBET.COM, INC. AND SUBSIDIARIES
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 SIX MONTHS ENDED JUNE 30, 2008
 Note 1: Basis of Presentation
    Note 2: Earnings Per Share
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Numerator:Net income (loss)
    
    $
    2,229
    
    
    $
    (373
    )
    
    $
    3,412
    
    
    $
    439Denominator:Basic weighted average shares outstanding
    
    
    41,519
    
    
    
    42,052
    
    
    
    41,519
    
    
    
    41,875Effect of dilutive stock options
    
    
    468
    
    
    
    
    
    
    
    432
    
    
    
    1,157Diluted weighted average shares
outstanding
    
    
    41,987
    
    
    
    42,052
    
    
    
    41,951
    
    
    
    43,032Earnings (loss) per share  basic
    
    $
    0.05
    
    
    $
    (0.01
    )
    
    $
    0.08
    
    
    $
    0.01Earnings (loss) per share  diluted
    
    $
    0.05
    
    
    $
    (0.01
    )
    
    $
    0.08
    
    
    $
    0.01
  5




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Note 3: Detail of Selected Balance Sheet Accounts
 June 30,
    
    
    December 31,2008
    
    
    2007(unaudited)(in thousands)Accounts receivable, netTrack receivables
    
    $
    4,309
    
    
    $
    7,964Player receivable
    
    
    11
    
    
    
    60Other
    
    
    286
    
    
    
    2,6964,606
    
    
    
    10,720Less: allowance for doubtful accounts
    
    
    (838
    )
    
    
    (3,406
    )$
    3,768
    
    
    $
    7,314InventoryTotalizator components
    
    $
    1,666
    
    
    $
    1,477Ticket stock
    
    
    322
    
    
    
    608$
    1,988
    
    
    $
    2,085Property and equipment, netPari-mutual equipment
    
    $
    22,509
    
    
    $
    21,966Computer equipment
    
    
    14,809
    
    
    
    14,520Computer equipment under capital lease
    
    
    1,604
    
    
    
    1,605Software
    
    
    4,262
    
    
    
    4,347Leasehold improvements
    
    
    3,190
    
    
    
    3,201Office furniture, fixtures and equipment
    
    
    581
    
    
    
    66346,955
    
    
    
    46,302Less: accumulated depreciation
    
    
    (24,751
    )
    
    
    (21,638
    )$
    22,204
    
    
    $
    24,664Intangibles assets other than goodwill, netIntangibles, other than goodwill
    
    $
    7,925
    
    
    $
    10,274Less: accumulated amortization
    
    
    (1,791
    )
    
    
    (3,769
    )$
    6,134
    
    
    $
    6,505
  6




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Note 4: Debt
  June 30,
    
    
    December 31,2008
    
    
    2007(unaudited)(in thousands)Promissory note
    
    $
    3,200
    
    
    $
    3,200Bank term loan
    
    
    8,500
    
    
    
    10,958Capital lease obligations and other
    
    
    890
    
    
    
    99912,590
    
    
    
    15,157Less: short-term debt and current portion of long-term debt
    
    
    12,373
    
    
    
    10,390Long-term debt, less current maturities
    
    $
    217
    
    
    $
    4,767
 ' '
   
    
    change the maturity date to January 31, 2009;
 
    
    eliminate the Company's option to have its interest rate determined by reference to
LIBOR;
 
    
    provide for additional payments on principal of $1.0 million each on the date of the
amendment, July 1, 2008 and September 1, 2008, respectively, and $0.5 million on December 1,
2008;
 
    
    set the prime rate margin at 1.50%;
 
    
    modify the definition of EBITDA and the adjustments to EBITDA for purposes of the credit
facility; and
 
    
    amend the minimum EBITDA level and leverage ratio the Company is required to maintain.
    7




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' '
  Note 5: Income Taxes
    '
    Note 6: Litigation and Contingencies
 ' ' ' ' '
  8




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Note 7: Stockholders Equity
  WeightedAverageStock
    
    
    OptionOptions
    
    
    Price(in thousands)Balance at January 1, 2008
    
    
    4,717
    
    
    $
    2.70Options granted
    
    
    1,008
    
    
    
    1.41Options exercisedOptions cancelled
    
    
    (733
    )
    
    
    3.68Balance at June 30, 2008
    
    
    4,992
    
    
    $
    2.29
  9




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Options Outstanding
    
    
    Options ExercisableWeightedWeighted
    
    
    Average
    
    
    
    
    
    
    WeightedAverage
    
    
    Remaining
    
    
    
    
    
    
    AverageNumber of Shares
    
    
    Exercise
    
    
    Contractual
    
    
    Number of Shares
    
    
    Exercise(in thousands)
    
    
    Price
    
    
    Life (years)
    
    
    (in thousands)
    
    
    PriceRange of Exercise Prices:$0.50 to $0.68
    
    
    870
    
    
    $
    0.53
    
    
    
    3.92
    
    
    
    870
    
    
    $
    0.53$1.22 to $1.56
    
    
    998
    
    
    
    1.40
    
    
    
    8.41
    
    
    
    235
    
    
    
    1.41$2.23 to $2.74
    
    
    1,804
    
    
    
    2.39
    
    
    
    5.37
    
    
    
    1,534
    
    
    
    2.36$3.04 to $3.92
    
    
    716
    
    
    
    3.56
    
    
    
    6.98
    
    
    
    304
    
    
    
    3.37$4.00 to $4.91
    
    
    511
    
    
    
    4.38
    
    
    
    5.76
    
    
    
    412
    
    
    
    4.38$5.03 to $5.62
    
    
    93
    
    
    
    5.31
    
    
    
    6.88
    
    
    
    64
    
    
    
    5.33Total at June 30, 2008
    
    
    4,992
    
    
    
    2.29
    
    
    
    6.02
    
    
    
    3,419
    
    
    
    2.22
 Note 8: United Tote Acquisition
 ' '
 
    
    $9.75 million in cash;
 
    
    Three unsecured promissory notes with an aggregate principal amount of $10.2 million; and
 
    
    2,181,818 shares of Youbet common stock that was subject to a make-whole provision
which valued such shares at $5.50 per share.
     10




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Note 9: Segment Reporting
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,(unaudited, in thousands)2008
    
    
    2007
    
    
    2008
    
    
    2007RevenueAdvance deposit wagering segment
    
    $
    22,613
    
    
    $
    26,274
    
    
    $
    41,789
    
    
    $
    49,560Totalizator services segment
    
    
    6,626
    
    
    
    7,000
    
    
    
    11,961
    
    
    
    12,306$
    29,239
    
    
    $
    33,274
    
    
    $
    53,750
    
    
    $
    61,866Revenue by Geographic AreaUnited States
    
    $
    28,647
    
    
    $
    32,673
    
    
    $
    52,700
    
    
    $
    60,859International
    
    
    592
    
    
    
    601
    
    
    
    1,050
    
    
    
    1,007$
    29,239
    
    
    $
    33,274
    
    
    $
    53,750
    
    
    $
    61,866Reconciliation to Income Before Income Tax (Benefit)Income (loss) from continuing operations, before
other income (expense) and income tax expense
(benefit)Advance deposit wagering segment
    
    $
    2,627
    
    
    $
    (201
    )
    
    $
    4,924
    
    
    $
    1,853Totalizator service segment
    
    
    2
    
    
    
    179
    
    
    
    (816
    )
    
    
    (1,046
    )2,629
    
    
    
    (22
    )
    
    
    4,108
    
    
    
    807Interest income
    
    
    48
    
    
    
    185
    
    
    
    117
    
    
    
    384Interest expense
    
    
    (318
    )
    
    
    (562
    )
    
    
    (672
    )
    
    
    (1,019
    )Other
    
    
    (73
    )
    
    
    8
    
    
    
    (65
    )
    
    
    19Income (loss) before income tax (benefit) from
continuing operations
    
    
    2,286
    
    
    
    (391
    )
    
    
    3,488
    
    
    
    191Income (loss) before income tax (benefit) from
discontinued operations
    
    
    (213
    )
    
    
    16
    
    
    
    (622
    )
    
    
    790Income (loss) before income tax (benefit)
    
    $
    2,073
    
    
    $
    (375
    )
    
    $
    2,866
    
    
    $
    981Capital Spending,includes capital leasesAdvance deposit wagering segment
    
    $
    172
    
    
    $
    144
    
    
    $
    893
    
    
    $
    418Totalizator services segment
    
    
    131
    
    
    
    424
    
    
    
    185
    
    
    
    1,710$
    303
    
    
    $
    568
    
    
    $
    1,078
    
    
    $
    2,128Depreciation and AmortizationAdvance deposit wagering segment
    
    $
    390
    
    
    $
    498
    
    
    $
    828
    
    
    $
    950Totalizator services segment
    
    
    1,582
    
    
    
    1,651
    
    
    
    2,951
    
    
    
    2,817$
    1,972
    
    
    $
    2,149
    
    
    $
    3,779
    
    
    $
    3,767
 June 30,
    
    
    December 31,2008
    
    
    2007(unaudited)(in thousands)Total AssetsAdvance deposit wagering segment
    
    $
    20,226
    
    
    $
    23,617Totalizator services segment
    
    
    37,886
    
    
    
    41,433$
    58,112
    
    
    $
    65,050
  11




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Note 10: Impairment of Intangibles and Goodwill
 '
   Note 11: Discontinued Operations
   Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2007
    
    
    2007Revenues
    
    $
    122
    
    
    $
    371Cost of revenues
    
    
    96
    
    
    
    174Gross profit
    
    
    26
    
    
    
    197Operating expenses
    
    
    193
    
    
    
    418Net loss
    
    $
    (167
    )
    
    $
    (221
    )Earnings (loss) per share  Basic
    
    $
    (0.00
    )
    
    $
    (0.01
    )Earnings (loss) per share  Diluted
    
    $
    (0.00
    )
    
    $
    (0.01
    )
  12




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Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Revenues
    
    $
    
    
    
    $
    4,062
    
    
    $
    46
    
    
    $
    10,536Cost of revenues
    
    
    11
    
    
    
    2,877
    
    
    
    79
    
    
    
    7,584Gross profit (loss)
    
    
    (11
    )
    
    
    1,185
    
    
    
    (33
    )
    
    
    2,952Operating expenses
    
    
    202
    
    
    
    1,002
    
    
    
    589
    
    
    
    1,941Net income (loss)
    
    $
    (213
    )
    
    $
    183
    
    
    $
    (622
    )
    
    $
    1,011Earnings (loss) per share  Basic
    
    $
    (0.01
    )
    
    $
    0.00
    
    
    $
    (0.01
    )
    
    $
    0.02Earnings (loss) per share  Diluted
    
    $
    (0.01
    )
    
    $
    0.00
    
    
    $
    (0.01
    )
    
    $
    0.02
  13




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##### Table of Contents



Item 2. Managements discussion and analysis of financial condition and results of operations
 Forward-looking statements
  Overview
  www.youbet.com
      14




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##### Table of Contents



Critical accounting estimates and policies
  Recent Accounting Pronouncements
 Fair Value Measurements. The Fair Value Option for Financial
Assets and Financial Liabilities  including an amendment of FAS 115.
 " Business Combinations. "
 " Noncontrolling Interests in
Consolidated Financial Statements-An Amendment of ARB No. 51. "
   15




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##### Table of Contents



Results of continuing operations for the three months ended June 30, 2008 compared to the three
months ended June 30, 2007
 Revenues
    Operating expenses
 Track fees
 Licensing fees
 Contract costs
 Network costs
  16




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##### Table of Contents



Research and development
 Sales and marketing
 General and administrative
 Depreciation and amortization
 Interest expense (income)
 Other income
 Results of continuing operations for the six months ended June 30, 2008 compared to the six months
ended June 30, 2007
 Revenues
    Operating expenses
 Track fees
 Licensing fees
 Contract costs
  17




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##### Table of Contents



Network costs
 Research and development
 Sales and marketing
 General and administrative
 Depreciation and amortization
 Interest expense
 Other income
  18




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##### Table of Contents



Liquidity and capital resources
          19




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##### Table of Contents



Item 3. Quantitative and qualitative disclosures about market risk
  
 Item 4. Controls and procedures
  .
 
 Part II. Other information
 
 Item 1. Legal proceedings
 Form 10-Q.
 
 Item 1A. Risk factors
  
 Item 2. Unregistered sales of equity securities and use of proceeds
  
 Item 3. Defaults upon senior securities
  
 Item 4. Submission of matters to a vote of security holders
   20




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##### Table of Contents



Nominee:
    
    Votes For
    
    
    Votes WithheldMichael Brodsky
    
    
    31,802,975
    
    
    
    2,903,330Gary Adelson
    
    
    31,708,450
    
    
    
    2,997,855James Edgar
    
    
    31,617,110
    
    
    
    3,089,195F. Jack Liebau
    
    
    31,698,163
    
    
    
    3,008,142Jay R. Pritzker
    
    
    31,802,036
    
    
    
    2,904,269Michael D. Sands
    
    
    31,745,000
    
    
    
    2,961,305Michael Soenen
    
    
    31,561,825
    
    
    
    3,144,480
  
 Item 5. Other information
   21




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##### Table of Contents



Item 6. Exhibits
 3.1
    
    
    Certificate of Incorporation of Youbet.com, as amended (incorporated by
reference to Exhibit 3.1 to Youbets Form 10-Q SB for the quarter ended
September 30, 2003).3.2
    
    
    Amended and Restated Bylaws of Youbet.com, as amended (incorporated by reference
to Exhibit 3.1 to Youbets Current Report on Form 8-K filed April 20, 2007).10.1
    *
    
    Youbet.com, Inc. Equity Incentive Plan (incorporated by reference to Exhibit
10.2 to Youbets registration statement on Form S-3, File No. 333-12613110.2
    *
    
    Amendment Number One to the Youbet.com, Inc. Equity Incentive Plan (incorporated
by reference to Exhibit 10.2 to Youbets current report on Form 8-K filed June
16, 2006).10.3
    *
    
    Amendment Number Two to the Youbet.com, Inc. Equity Incentive Plan (incorporated
by reference to Exhibit 10.3 to Youbets current report on Form 8-K filed June
17, 2008).10.4
    *
    
    Form of Incentive Stock Option Agreement (incorporated by reference to Exhibit
10.4 to Youbets current report on Form 8-K filed June 17, 2008).10.5
    *
    
    Form of Performance Stock Option Agreement (incorporated by reference to Exhibit
10.5 to Youbets current report on Form 8-K filed June 17, 2008).10.6
    *
    
    Form of Non-Employee Director Incentive Stock Option Agreement (incorporated by
reference to Exhibit 10.6 to Youbets current report on Form 8-K filed June 17,
2008).10.7
    *

    

Employment
Agreement, dated as of March 1, 2008, by and between Youbet.com,
Inc. and Dan Perini.31.1
    
    
    Certification of President and Chief Executive Officer Pursuant to Rule
13a-14(a) of the Securities Exchange Act of 1934.31.2
    
    
    Certification of Chief Financial Officer and Treasurer Pursuant to Rule
13a-14(a) of the Securities Exchange Act of 1934.32.1
    
    
    Certification Pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934.
 *
    
    Management contract or compensatory plan. 
 SIGNATURES
  YOUBET.COM, INC.August 11, 2008
    By:
    /s/ Michael BrodskyMichael BrodskyChief Executive OfficerAugust 11, 2008
    By:
    /s/ James A. BurkJames A. BurkChief Financial Officer  22