Exhibit 10.1


 


REIMBURSEMENT AGREEMENT


 


For
Pledged Certificate of Deposit


 


THIS REIMBURSEMENT AGREEMENT
FOR PLEDGED CERTIFICATE OF DEPOSIT (this “Agreement”), dated as of December 10,
2009, between Leroy’s Horse and Sports Place, a Nevada corporation (“Obligor”),
and Victor J. and Terina Salerno, a married couple (the “Salernos”).


 


Recitals


 


A.            Obligor is required under
Nevada Gaming Commission (“NGC”) Regulation 22.040 to maintain a reserve
sufficient to cover any of its outstanding wagering liability, including unpaid
winning tickets and telephone account deposits.


 


B.            On October 1, 2009,
subject to the execution of definitive agreements, the Salernos agreed to
pledge, for the benefit of the Obligor, a certificate of deposit in the amount
of $200,000 (the “Pledged Amount”) in favor of the Nevada Gaming Control Board
(“NGCB”) to increase the Company’s reserve balance to satisfy the requirements
of Regulation 22.040.


 


C.            In connection with the
foregoing, the Salernos deposited the Pledged Amount into Nevada State Bank and
entered into the following definitive agreements: (i) Agreement, dated November 11,
2009, between the Salernos and Nevada State Bank, and (ii) Pledged
Certificate of Deposit Statement, dated November 23, 2009, by the Salernos
in favor of NGCB (collectively, the “Pledged Documents”).


 


D.            Obligor agreed to enter into
this Agreement to induce the Salernos to enter into the Pledged Documents.


 


Agreements


 


NOW, THEREFORE, in
consideration of the premises and in order to induce the Salernos to execute
and deliver the Pledged Documents, the parties hereto agree as follows:


 


1

















 


1.             Pledge Fee.  Obligor shall pay, or cause to
be paid, to the Salernos a fee equal to twelve percent (12%) per annum of the
outstanding Pledged Amount, excluding any earned interest from Nevada State
Bank, (the “Pledge Fee”) so long as the Pledged Documents are in effect,
payable on the 1st day of each month commencing on November 1, 2009.


 


2.             Reimbursement.  Obligor shall pay to the
Salernos (i) on each date on which the Pledged Amount, or any portion
thereof, shall be released to the NGCB pursuant to the terms of the Pledged
Documents a sum equal to the amount so released (a “Release”), plus (ii) in
addition to the Pledge Fee, interest on the unreimbursed amount from the
release date until reimbursement is received by the Salernos in full.  Such interest shall be at the then prime rate
of Nevada State Bank or its successor.


 


3.             Payments and Computations.  Obligor shall make each payment
hereunder not later than 3:00 P.M. (Pacific time) on the day when due
without deduction or offset in lawful money of the United States of America to
the Salernos at the address of the Salernos referred to in Section 8 in
same-day funds or in accordance with the wire instructions in such
section.  Computations of fees and
interest established herein (as applicable) shall be made by the Salernos on
the basis of a year of 360 days for the actual number of days elapsed.


 


4.             Non-Business Days.  Whenever any payment to be
made hereunder shall be stated to be due on a day which is not a business day,
such payment shall be made on the next succeeding business day, and such
extension of time shall in such case be included in the computation of payment
of interest or commission, as the case may be.


 


5.             Nature
of Obligations.  Obligor’s
obligations to the Salernos under this Agreement are absolute, unconditional
and irrevocable, and shall be paid and performed in accordance with the terms
hereof irrespective of any act, omission, event or condition.  Obligors’ obligations to the Salernos under
this Agreement shall be unsecured.


 


6.             Other
Covenant.  Obligor must
make reasonable efforts to increase its cash deposit requirement under Regulation
22,040 and secure the release of this Agreement from the Nevada Gaming Control
Board in whole or in part within 12 months from the date of this Agreement.


 


7.             Waiver.  Obligor waives presentment,
protest, dishonor, notice of dishonor, demand, notice of protest, notice of
non-payment, and notice of acceptance of this Agreement, and any other notice
or demand of any kind from the Salernos.


 


8.             Amendments.  This
Agreement may be amended only by a written instrument duly executed by each of
the parties hereto.


 


9.             Notices.  Each notice, request or
communication shall be effective (i) if given by facsimile, electronic
mail or other electronic means, when such communication is transmitted to the
address specified below and any appropriate confirmation is received, (ii) if
given by certified or registered mail, return receipt requested, on the date of
receipt appearing on the return postal receipt for notices given by certified
or registered mail, or (iii) if given by hand delivery, when delivered at
the address specified below:


 


2

















 


	
  If
  to Obligor:

  	
   

  	
  Leroy’s
  Horse and Sports Place.

  
	
   

  	
   

  	
  675 Grier Drive

  
	
   

  	
   

  	
  Las Vegas, Nevada 89119

  
	
   

  	
   

  	
  Attention: President

  
	
   

  	
   

  	
   

  
	
  If
  to the Salernos:

  	
   

  	
  Vic
  Salerno

  
	
   

  	
   

  	
  c/o
  American Wagering, Inc.

  
	
   

  	
   

  	
  675
  Grier Drive

  
	
   

  	
   

  	
  Las
  Vegas, Nevada 89119

  
	
   

  	
   

  	
  Attention:
  Legal Department

  



 


or for any of the foregoing
cases, at such other address or facsimile number as the addressee may hereafter
specify for the purpose in a notice to the other party specifically captioned “Notice
of Change of Address pursuant to Section 8 of the Reimbursement Agreement
for Pledged Certificates of Deposit.”


 


10.           Indemnification.  Obligor shall indemnify and
hold the Salernos harmless from and against any and all claims, actions,
proceedings, damages, losses, liabilities, costs and expenses (including but
not limited to attorneys’ fees and costs) which the Salernos may incur or which
may be claimed against the Salernos by any person:


 


(a)           by reason of,
or in connection with, the execution, delivery or performance of this Agreement
or any of the Pledged Documents; or


 


(b)           by reason of,
or in connection with, any of the transactions or other matters contemplated by
this Agreement or any Pledged Document; or


 


(c)           by reason of,
or in connection with, any Release to the NGCB under the Pledged Documents.


 


11.           Governing Law.  This Agreement shall be
governed by, and construed in accordance with, the laws of the State of Nevada.


 


12.           Execution in
Counterparts.  It shall not be necessary that all parties execute and deliver the same
counterpart of this Agreement.  This
Agreement shall therefore become effective when each party has executed any
counterpart hereof and delivered the same to the other parties.  All such counterparts, collectively, shall be
deemed a single agreement.


 


IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed and delivered as of the date first above
written.


 


LEROY’S HORSE AND SPORTS PLACE


a Nevada
corporation


 


3

















 


	
  By:

  	
  /s/John Salerno

  	
   

  	
   

  
	
   

  	
  John Salerno, Secretary

  	
   

  	
   

  



 


 


	
  /s/Victor J. Salerno

  	
   

  	
   

  
	
  Victor J. Salerno

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/Terina Salerno

  	
   

  	
   

  
	
  Terina Salerno

  	
   

  	
   

  



 


4