**Exhibit 10.3**

 

SECURED PROMISSORYNOTE

 
| US $195,000.00 |   | Las Vegas, Nevada  |
|----------------|--------|--------------------|
|           |   | June 11, 2010 |

 

FOR VALUE RECEIVED, theundersigned, American Wagering, Inc., a Nevada corporation (“Borrower”),promises to pay to the order of Alpine Advisors LLC (“Lender”) the principalsum of one hundred ninety-five thousand dollars ($195,000.00) on June 17,2010 (the “Maturity Date”), together with interest from the date hereof throughthe Maturity Date at the rate of fifteen percent (15.0%) per annum.  If, and to the extent, the principal amountof this Note is not paid on the Maturity Date, the principal amount hereofoutstanding shall bear interest from the Maturity Date until paid in full atthe default rate of twenty-two percent (22.0%) per annum and shall be payableon demand or, in the absence of a demand, weekly, on the first business day ofeach week.  All interest shall becalculated on the basis of a 360-day year prorated for the number of days ineach month. All payments of principal and interest under this Note shall bemade in immediately available lawful funds of the United States of America bywire transfer to a bank specified by Lender by no later than 3:00 p.m.(Nevada time) on the date such payments are due.

 

This Note may be prepaid, inwhole or in part, at any time, and from time to time, without premium orpenalty.  All prepayments shall beapplied first to any accrued and unpaid interest and then to the unpaidprincipal balance hereof.

 

As security for the paymentof all indebtedness under this Note, Borrowerhereby pledges to Lender, and grants to Lendera first priority security interest in, all of borrower’s right, title andinterest in and to the following property (the “Collateral”): (i) allequity interests in Computerized Bookmaking Systems, Inc., a Nevadacorporation (“CBS”); (ii) all shares of stock, certificates, instruments or other documentsevidencing or representing the same; and (iii) all present and futurepayments, proceeds, dividends, distributions, instruments, compensation,property, assets, interests and rights in connection with or related to any ofthe foregoing.  If Borrower defaults inpaying any indebtedness evidenced hereby promptly on the date when due andpayable, Lender shall have, in addition to other rights and remedies provided forherein or otherwise available to it, all rights and remedies of a secured partyon default under the Uniform Commercial Code (“UCC”).

 

Borrower hereby representsand warrants to Lender that: (a) each of Borrower and CBS is a corporationorganized under the laws of the State of Nevada; (b) Borrower has noorganizational number, and its exact legal name is American Wagering, Inc.;(c) the issued and outstanding capital stock of CBS is 100 shares ofcommon stock, represented by Certificate No. 1, all of which have beenduly authorized and issued and are fully-paid and non-assessable, and none ofwhich constitutes Margin Stock (as defined in Regulation U of the Board ofGovernors of the Federal Reserve System of the United States, as the same isfrom time to time in effect); and (d) all of the Collateral is owned byBorrower free and clear of any lien, security interest or other encumbranceother than the pledge and security interest in favor of Lender.  The foregoing representations and warrantiesshall survive the execution and delivery of this Note.

 

Borrower hereby irrevocablyauthorizes Lender at any time and from time to time to file in any jurisdictionin which the UCC has been adopted any initial financing statements andamendments thereto that (a) describe the Collateral, and (b) containany other information required by part 5 of Article 9 of the UCC for thesufficiency or filing office acceptance of any initial financing statement oramendment.

 

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This Note may not bemodified, amended, waived or otherwise altered in whole or in part, except by afurther writing signed by the party to be charged therewith.  Any failure of Borrower to comply with anyobligation herein may be waived by Lender only by a written instrument signedby Lender.  Any waiver or failure toexercise any right or remedy on any occasion shall not operate as a waiver of,or estoppel with respect to, any subsequent default hereunder.

 

This Note shall be bindingupon Borrower and its successors and assigns and shall inure to the benefit ofLender and its successors and assigns. Borrower may not assign its rights or delegate its duties, in whole orin part, under this Note.

 

This Note shall be governedby and construed in accordance with the laws of the State of Nevada withoutreference to conflicts of law principles thereof.

 

All amounts payablehereunder shall be paid free and clear of, and without deduction or offset for,any present or future taxes, levies, imposts, charges, withholdings, orliabilities with respect thereto, and free and clear of any and all otherdefenses, offsets, set-offs, claims, counterclaims, credits or deductions ofany kind.

 

The release of any securityfor this Note or the alteration, amendment or waiver of any provision of thisNote or any instrument evidencing, securing or guaranteeing payment of thisNote or the performance by Borrower thereunder shall not release or modify oraffect the liability of, Borrower or any guarantor or any other person who maybe or become liable under or with respect to this Note.

 

Time is of the essence withrespect to this Note, and demand, protest, notice of demand and non-payment andall other demands and notices whatsoever in connection with the delivery,acceptance, performance or default of this Note are hereby expressly waived byBorrower and an action for amounts due hereunder shall immediately accrue.  Borrower shall be responsible for all costsand expenses (including reasonable attorneys’ fees and court costs) incurred byLender or any subsequent holder in connection with the collection of this Note.

 

In no event shall the rateof interest charged hereunder be higher than that allowed under applicablelaw.  If any excessive interest is hereinprovided for or shall be adjudicated to be so provided for herein, then the provisionsof this paragraph shall govern, and Borrower shall not be obligated to pay theamount of such interest to the extent that it is higher than that allowed underapplicable law.

 

If for any reason any termor provision of this Note is held to be invalid or unenforceable, all othervalid terms and provisions hereof shall remain in full force and effect, andall of the terms and provisions of this Note shall be deemed to be severable innature.

 

IN WITNESS WHEREOF, Borrower has executed this Note asof the date first written above.

 
|   | American Wagering, Inc. |
|--------|------------------------------|
|   |                         |
|   | By:                          | /s/ Victor Salerno |
|   | Name:                        | Victor Salerno |
|   | Its:                         | CEO |

 

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