-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, CfPcUQfx7iJRbgILhMgbbKuR4eEAqbURx4r/sXoLuFBVRYkF7K2gU0GcVpt+Z4lR bA9/IgXU325mg4AEO8RBRQ== 0000922423-95-000044.txt : 19950414 0000922423-95-000044.hdr.sgml : 19950411 ACCESSION NUMBER: 0000922423-95-000044 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19950404 SROS: NASD SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: ALLIANCE GAMING CORP CENTRAL INDEX KEY: 0000002491 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 880104066 STATE OF INCORPORATION: NV FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-33235 FILM NUMBER: 95526854 BUSINESS ADDRESS: STREET 1: 4380 BOULDER HGWY CITY: LAS VEGAS STATE: NV ZIP: 89121 BUSINESS PHONE: 7024354200 FORMER COMPANY: FORMER CONFORMED NAME: UNITED GAMING INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: GAMING & TECHNOLOGY INC DATE OF NAME CHANGE: 19890206 FORMER COMPANY: FORMER CONFORMED NAME: ADVANCED PATENT TECHNOLOGY INC DATE OF NAME CHANGE: 19830519 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: KIRKLAND INVESTMENT CORP CENTRAL INDEX KEY: 0000943420 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 9 WEST 57TH STREET CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2128882399 MAIL ADDRESS: STREET 2: 9 WEST 57TH STREET CITY: NEW YORK STATE: NY ZIP: 10019 SC 13D/A 1 SCHEDULE 13D AMENDMENT NO. 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 1 to SCHEDULE 13D Under the Securities Exchange Act of 1934 Alliance Gaming Corporation (Name of Issuer) Common Stock, $.10 par value (Title of Class of Securities) 364654 10 (CUSIP Number) Kirkland Investment Corporation 9 West 57th Street New York, New York 10019 Attention: Joel Kirschbaum, President (212) 888-2399 with a copy to: Kramer, Levin, Naftalis, Nessen, Kamin & Frankel 919 Third Avenue New York, New York 10022 Attention: Abbe Dienstag, Esq. (212) 715-9100 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d- 1(b)(3) or (4), check the following box: /_/ Check the following box if a fee is being paid with this statement: /_/ Page 1 of 42 Exhibit Index Appears on Page 22 PAGE SCHEDULE 13D CUSIP No. 364654 10 Page 2 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Joel Kirschbaum 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) /_/ 3) SEC USE ONLY 4) SOURCE OF FUNDS PF, AF 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ United States of America 7) SOLE VOTING POWER 1,333,333 See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH 1,333,333 See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,333,333 See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.3% 14) TYPE OF REPORTING PERSON IN SCHEDULE 13D CUSIP No. 364654 10 Page 3 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Kirkland Investment Corporation 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) / / 3) SEC USE ONLY 4) SOURCE OF FUNDS WC, AF 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ 6) CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7) SOLE VOTING POWER 1,333,333 See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH 1,333,333 See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,333,333 See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.3% 14) TYPE OF REPORTING PERSON CO SCHEDULE 13D CUSIP No. 364654 10 Page 4 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Kirkland-Ft. Worth Investment Partners, L.P. 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) / / 3) SEC USE ONLY 4) SOURCE OF FUNDS WC 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ 6) CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7) SOLE VOTING POWER 1,333,333 See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH 1,333,333 See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,333,333 See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.3% 14) TYPE OF REPORTING PERSON PN SCHEDULE 13D CUSIP No. 364654 10 Page 5 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Gaming Systems Advisors, L.P. 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) / / 3) SEC USE ONLY 4) SOURCE OF FUNDS Not applicable 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ 6) CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7) SOLE VOTING POWER -0- See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH -0- See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON -0- See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Not applicable 14) TYPE OF REPORTING PERSON PN PAGE SCHEDULE 13D CUSIP No. 364654 10 Page 6 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Craig Fields 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) / / 3) SEC USE ONLY 4) SOURCE OF FUNDS Not applicable 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ 6) CITIZENSHIP OR PLACE OF ORGANIZATION United States 7) SOLE VOTING POWER 62,500 See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH 62,500 See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 62,500 See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1% 14) TYPE OF REPORTING PERSON IN SCHEDULE 13D CUSIP No. 364654 10 Page 7 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Jay R. Gottlieb 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) / / 3) SEC USE ONLY 4) SOURCE OF FUNDS Not applicable 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ 6) CITIZENSHIP OR PLACE OF ORGANIZATION United States 7) SOLE VOTING POWER 118,333 See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH 118,333 See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 118,333 See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1% (assuming the conversion of the outstanding shares of Convertible Special Stock) 14) TYPE OF REPORTING PERSON IN SCHEDULE 13D CUSIP No. 364654 10 Page 8 of 42 1) NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON David Robbins 2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/ See Item 5 (b) / / 3) SEC USE ONLY 4) SOURCE OF FUNDS Not applicable 5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) /_/ 6) CITIZENSHIP OR PLACE OF ORGANIZATION United States 7) SOLE VOTING POWER 20,000 See Items 4 and 5 NUMBER OF 8) SHARED VOTING POWER SHARES -0- BENEFICIALLY OWNED BY 9) SOLE DISPOSITIVE POWER EACH 20,000 See Items 4 and 5 REPORTING PERSON 10) SHARED DISPOSITIVE POWER WITH -0- 11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 20,000 See Items 4 and 5 12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES /_/ 13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1% 14) TYPE OF REPORTING PERSON IN SCHEDULE 13D Page 9 Introduction This Statement amends and restates the Schedule 13D, dated June 23, 1994, filed by Joel Kirschbaum, Kirkland Investment Corporation, a Delaware corporation, Kirkland-Ft. Worth Investment Partners, L.P., a Delaware limited partnership, and Gaming Systems Advisors, L.P., a Delaware limited partnership, with respect to the common stock, par value $.10 per share, of Alliance Gaming Corporation, a Nevada corporation (formerly United Gaming, Inc.). Item 1. Security and Issuer. This Schedule 13D relates to the Common Stock, par value $.10 per share (the "Common Stock"), of Alliance Gaming Corporation, a Nevada corporation (formerly United Gaming, Inc.) (the "Company"). The address of the Company's principal executive office is 4380 Boulder Highway, Las Vegas, Nevada 89121. Item 2. Identity and Background. (a)-(c) This Statement is being filed by Joel Kirschbaum, Kirkland Investment Corporation, a Delaware corporation ("KIC"), Kirkland-Ft. Worth Investment Advisors, L.P., a Delaware limited partnership ("KFW"), Gaming Systems Advisors, L.P., a Delaware limited partnership ("GSA"), Craig Fields, Jay R. Gottlieb and David Robbins (collectively, the "Reporting Persons"). The business address of each of KIC, KFW, GSA and Mr. Kirschbaum is 9 West 57th Street, New York, New York 10019. The business address of Dr. Fields is 2737 Devonshire Place, N.W., Washington, D.C. 20008. The business address of Mr. Gottlieb is c/o U.S. Capital Corporation, 980 N. Michigan, Suite 1400, Chicago, Illinois 60611. The business address of Mr. Robbins is 919 Third Avenue, New York, New York 10022. KFW is a limited partnership established for the purpose of acquiring, holding, investing in and disposing of securities of private and public corporations or other entities, including the Common Stock. KIC is the sole general partner of KFW, and its sole business is holding the general partnership interest in KFW and conducting ancillary activities. GSA is a limited partnership established for the purpose of rendering advisory services to the Company in respect of financing and other transactions. The sole general partner of GSA is GSA, Page 10 Inc., a Delaware corporation. Joel Kirschbaum is the sole stockholder, director and officer of KIC and GSA, Inc. His occupation is as director of and an advisor to the Company and in managing the businesses of KFW, KIC, GSA and GSA, Inc. Dr. Fields is Vice Chairman of the Board of the Company. Mr. Gottlieb is a director and Executive President of the Company. Mr. Robbins is an attorney engaged in the private practice of law and a director of the Company. (d)-(e) During the last five years, none of the Reporting Persons or GSA, Inc. has been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors) or has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, Federal or state securities laws or finding any violation with respect to such laws. (f) KFW and GSA are Delaware limited partnerships. KIC and GSA, Inc. are Delaware corporations. Mr. Kirschbaum, Dr. Fields, Mr. Gottlieb and Mr. Robbins are citizens of the United States of America. Item 3. Source and Amount of Funds or Other Consideration. The source of funds for the investment by Mr. Kirschbaum, KIC and KFW in the Common Stock is equity capital in KFW. Mr. Kirschbaum, KIC and KFW invested in the aggregate $5,000,000 in the Company in exchange for 1,333,333 shares of Special Stock (as defined in Item 4 below) and KFW Warrants (as defined in Item 4 below) to acquire 2,750,000 shares of Common Stock, all of which was paid by KFW. Of such $5,000,000, 25% was contributed by KIC and 75% was contributed by the sole limited partner in KFW. Mr. Kirschbaum initially provided all of the funds for KIC's portion of KFW's investment in the Common Stock. GSA is not presently deemed to own shares of Common Stock. See Item 4 and Item 6 with respect to certain warrants to acquire Common Stock held by GSA, options and warrants to acquire Common Stock held by Dr. Fields and options to acquire Common Stock and warrants held by Messrs. Gottlieb and Robbins. Page 11 Item 4. Purpose of Transaction. On September 21, 1993, KFW, KIC and the Company consummated the transactions contemplated by a Securities Purchase Agreement (the "Purchase Agreement"), pursuant to which, among other things, KFW acquired (a) 1,333,333 shares of Non- Voting Junior Convertible Special Stock of the Company (the "Special Stock") and (b) warrants to acquire 2,750,000 shares of Common Stock, allocated in three equal series (the "KFW Warrants"; together with the Special Stock, the "Securities"), for an aggregate investment in the Company of $5,000,000. Each share of Special Stock is convertible into one share of Common Stock, subject to customary anti-dilution adjustments. The KFW Warrants have an exercise price of $1.50 per share, subject to customary anti-dilution adjustments, and have a term of six years from the date of issuance, which is September 21, 1994. One third of the KFW Warrants are exercisable so long as the Common Stock has traded above $11 per share for a specified period of time; one third are exercisable so long as the Common Stock has traded above $13 per share for a specified period; and one third are exercisable so long as the Common Stock has traded above $15 per share for a specified period. Based on the trading price of the Common Stock, none of the KFW Warrants is presently exercisable. Pursuant to the Purchase Agreement and the Stockholders Agreement referred to below, neither the Special Stock nor the KFW Warrants could be converted into Common Stock until the earlier to occur of (a) KIC (and certain of its affiliates or related persons) having obtaining all applicable gaming licenses in connection with such conversion and (b) a determination having been made that such licensing is not necessary. KIC and such affiliates and related persons (including Mr. Kirschbaum) obtained such licensing from the Nevada Gaming Commission on June 23, 1994; accordingly, the Special Stock held by KIC is presently convertible into Common Stock. Also on September 21, 1993, KFW, KIC, GSA and Alfred H. Wilms executed a Stockholders Agreement (the "Stockholders Agreement") relating to the Securities, certain warrants held and hereafter to be held by GSA (the "GSA Warrants") and shares of Common Stock, warrants and options convertible into shares of Common Stock held by Mr. Wilms. The Stockholders Agreement was amended on October 20, 1994 to modify certain provisions relating to the election of directors of the Company. Pursuant to the Stockholders Agreement, as amended, Mr. Wilms (who is the owner of Common Stock and equivalents representing approximately 7,034,000 shares of Common Stock), Page 12 KFW, KIC and GSA have agreed to vote their shares such that the Board of Directors of the Company will consist of four persons designated by KIC, one person designated by Mr. Wilms and two directors designated by a majority of the Board of Directors. The Stockholders Agreement, as amended, also provides that Mr. Wilms may designate two persons (the "Advisors") who shall be observers of, and advisors to, the Board of Directors and who will be entitled to attend all of the Company's Board of Directors' meetings and receive all information furnished to members of the Board. Mr. Wilms and/or at least one Advisor will be entitled to attend all meetings of the committees of the Company's and its subsidiaries' Board of Directors. The voting agreements between Mr. Wilms and KIC will terminate upon the earlier of (i) September 21, 1997 and (ii) the date that both (a) KIC and its permitted transferees and (b) Mr. Wilms and his permitted transferees each own in the aggregate Company securities representing less than 5% of the Company's fully diluted Common Stock; provided, that in the event the average closing price of a share of Common Stock has not traded at or above $15 per share for any thirty consecutive trading day period during the 15-month period prior to the earlier of the dates described in clauses (i) and (ii), above, then, as soon as practicable after September 21, 1997, KIC and Mr. Wilms use their best efforts to cause the Board of Directors to consist of four designees of KIC and three designees of Mr. Wilms. Mr. Steve Greathouse and Dr. Fields currently serve as directors of the Company pursuant to the foregoing arrangements. KFW and KIC intend to transfer a portion of the Special Stock and KFW Warrants to certain unaffiliated persons, as described in Item 6 (including sales on substantially similar terms to those described in Item 6); KFW intends that it ultimately may distribute the remaining Special Stock and KFW Warrants to KFW's direct or indirect partners. Other than as described in this Item 4 and in Item 6, Mr. Kirschbaum, KIC and KFW intend to hold the Special Stock and KFW Warrants owned by them for investment purposes and have no present intention to dispose of such securities, except that the Reporting Persons may from time to time hereafter cause the Special Stock to be converted into shares of Common Stock. GSA presently holds GSA Warrants to acquire 1,250,000 shares of Common Stock, which it acquired pursuant to the terms of an Advisory Agreement, dated June 25, 1993, among GSA, the Issuer and Mr. Wilms (the "GSA Advisory Agreement"). GSA has to date earned certain additional GSA Warrants (the exact amount of which has not yet been finally determined) and may in the future earn additional GSA Warrants in respect of future Page 13 transactions. None of the GSA Warrants are presently exercisable. Pursuant to the GSA Advisory Agreement, the Company has retained GSA to assist the Company in identifying potential investors in the Company, in negotiating and obtaining financing for the Company and in identifying opportunities for acquisitions, dispositions, joint ventures and other similar transactions. The term of the GSA Advisory Agreement presently extends until the later of two years from the date of the Stockholders Agreement and the Licensing Date. As compensation for the services to be provided by GSA, the Company has agreed to issue GSA Warrants to GSA upon the consummation of certain transactions. GSA Warrants to acquire a maximum of 2.25 million shares of Common Stock, subject to customary anti-dilution provisions, may be issued to GSA under the GSA Advisory Agreement, which number may be increased to 3.75 million shares in the event of a special strategic transaction, as defined in the GSA Advisory Agreement. The GSA Warrants have an exercise price of $1.50 per share, subject to customary anti-dilution adjustments, and have a term of six years from their date of issuance (which date, in respect of the GSA Warrants heretofore issued, is September 21, 1993). One third of the GSA Warrants are exercisable so long as the Common Stock has traded above $11 per share for a specified period of time; one third are exercisable so long as the Common Stock has traded above $13 per share for a specified period; and one third are exercisable so long as the Common Stock has traded above $15 per share for a specified period. GSA Warrants to acquire 1,250,000 shares of Common Stock were issued to GSA on September 21, 1993. GSA is entitled to receive additional GSA Warrants in respect of certain transactions heretofore consummated, although the number of shares of Common Stock issuable upon exercise thereof has not yet been determined. A copy of the GSA Advisory Agreement is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. Pursuant to an Agreement, dated as of September 1, 1994, between Dr. Fields and the Company, the Company granted to Dr. Fields options to acquire 250,000 shares of Common Stock. A copy of Dr. Fields' Agreement is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. Such options have an exercise price of $5-3/4 per share and expire on August 31, 1999. Options to acquire 62,500 shares of Common Stock are currently exercisable, and options to acquire 62,500 shares of Common Stock vest on each of August 31, 1995, August 31, 1996 and August 31, 1997. Dr. Fields will be entitled to receive options to purchase an additional 150,000 shares of Common Stock in the event that prior to the termination of his Page 14 Agreement on August 31, 1997 (or earlier in accordance with the provisions thereof) the Company enters into a "Strategic Transaction" (as such term is defined in the Agreement). The exercise price for such options would be based on the market price for the Common Stock during a specified period preceding the first public announcement of the Strategic Transaction. Dr. Fields' Agreement also provides for the grant to Dr. Fields of warrants (the "Fields Warrants") to acquire 250,000 shares of Common Stock. The Fields Warrants, which are issued pursuant to a Warrant Agreement, dated as of September 1, 1994, between Dr. Fields and the Company, have an exercise price, subject to anti-dilution adjustment, of $1.50 per share, are allocated in three equal series, as described above with respect to the KFW Warrants, and otherwise have substantially the same terms as the KFW Warrants. Under the terms of Dr. Fields' Agreement, Fields Warrants to acquire 62,500 shares of Common Stock are currently vested, and Fields Warrants to acquire 62,500 shares of Common Stock will vest on each of August 31, 1995, August 31, 1996 and August 31, 1997. Based on the trading price of the Common Stock, none of the Fields Warrants are presently exercisable. The Agreement provides that Dr. Fields will vote all securities of the Company issued or delivered to him in connection with his engagement by the Company at all regular or special meetings of stockholders for the election of directors as directed and required by KIC pursuant to the Stockholders Agreement. Mr. Jay Gottlieb owns 30,000 shares of Common Stock and was granted by the Company options to acquire 300,000 shares of Common Stock. Such options have an exercise price of $5-3/4 per share and expire on July 14, 2004. Options to acquire 75,000 shares of Common Stock are currently exercisable and options to acquire 75,000 shares vest on each of July 14, 1995, July 14, 1996 and July 14, 1997. In addition, Mr. Gottlieb has entered into an option agreement (the "Gottlieb-KFW Option Agreement") with KFW pursuant to which Mr. Gottlieb has the option to acquire from KFW 13,333 shares of Special Stock and 27,500 KFW Warrants (apportioned in equal amounts among each of the three series of such warrants), or any cash, securities, property or other assets or rights that such shares of Special Stock or KFW Warrants may be converted into or exercised or exchanged for, at an exercise price of $50,000. The option may be exercised by Mr. Gottlieb, in whole and not in part, from and after May 9, 1995 for a period of five years; provided, however, that the option will cease to become exercisable on the earlier of (i) the date which is 30 days after the date on which KFW shall have transferred or disposed of for cash to unaffiliated third parties certain of the covered securities and (ii) 30 days after the date on which KFW gives notice that the option is being PAGE Page 15 terminated, so long as the termination date is after May 9, 1995. A form of the Gottlieb-KFW Option Agreement is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. The Gottlieb-KFW Option Agreement requires Mr. Gottlieb, upon exercise of the option, to execute an agreement to be bound by the terms of the Stockholders Agreement, and to vote the securities deliverable upon exercise of the option and other securities which he may obtain upon exercise, exchange or conversion thereof (but not other securities issued by the Company and owned by him), as directed by KIC. Mr. David Robbins has entered into an amended and restated option agreement with KFW (the "Robbins-KFW Option Agreement"), pursuant to which Mr. Robbins has the option to acquire from KFW an aggregate of 20,000 shares of Special Stock and 41,250 KFW Warrants (apportioned in equal amounts among each of the three series of such Warrants), or any cash, securities, property or other assets or rights that such shares of Special Stock or KFW Warrants may be converted into or exercised or exchanged for, at an aggregate exercise price of $75,000. The terms of the Robbins-KFW Option Agreement are substantially the same as the Gottlieb-KFW Option Agreement, except as provided in the following sentence. The options are exercisable in two parts: in whole but not in part with respect to 10,000 shares of Special Stock and 20,625 KFW Warrants (apportioned in equal amounts among each of the three series of such Warrants) from and after May 9, 1995, as provided with respect to the option of Mr. Gottlieb, and in whole but not in part with respect to 10,000 shares of Special Stock and 20,625 KFW Warrants (apportioned in equal amounts among each of the three series of such Warrants) on similar terms but from each and after September 6, 1995. A form of the Robbins-KFW Option Agreement is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. Other than as described above in this Item 4, none of the Reporting Persons have any plans or proposals relating to any of the items described in items (a) through (j) of Item 4. Item 5. Interest in Securities of the Issuer. (a) Mr. Kirschbaum, KIC and KFW beneficially own 1,333,333 shares of Common Stock issuable upon conversion of the Special Stock held by KFW, constituting approximately 10.3% of the shares of Common Stock deemed outstanding (based upon 11,629,650 shares of Common Stock outstanding). GSA is presently not deemed to own beneficially any shares of Common Stock. Dr. Fields may be deemed to own beneficially 62,500 shares of Common Stock issuable upon exercise of presently exercisable options, constituting less than 1% of the Common Stock outstanding. Page 16 Mr. Gottlieb may be deemed to own 13,333 shares of Common Stock, representing less than 1% of the Common Stock outstanding, that he may acquire upon exercise of an option to acquire Special Stock, which option is exercisable within 60 days. Mr. Robbins may be deemed to own 10,000 shares of Common Stock representing less than 1% of the Common Stock outstanding, that he may acquire upon exercise of an option to acquire Special Stock, which option is exercisable within 60 days. (b) By reason of its position as general partner of KFW, KIC may be deemed to possess power to vote and dispose of the Common Stock beneficially owned by KFW. By reason of his being sole stockholder, director and officer of KIC, Mr. Kirschbaum may be deemed to possess power to vote and dispose of the Common Stock beneficially owned by KFW and KIC. (c) The Fields Warrants and the options to acquire Common Stock were granted to Dr. Fields by action of the Board of Directors of the Company as of September 1, 1994. Other than as aforesaid, none of the Reporting Persons has effected any transactions in the Common Stock within the preceding 60 days. (d) Other than as described in Item 4 or Item 6, no person other than the Reporting Persons at present has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the shares of Common Stock deemed to be beneficially owned by them. (e) Not applicable. The Reporting Persons and Mr. Wilms may be deemed to be a group. Pursuant to Rule 13d-4, the Reporting Persons disclaim beneficial ownership of the Common Stock beneficially owned by Mr. Wilms, GSA disclaims beneficial ownership of the Common Stock owned by Mr. Kirschbaum, KIC and KFW, and each of KIC, KFW, GSA and Mr. Kirschbaum. Collectively, Dr. Fields, Mr. Gottlieb and Mr. Robbins disclaims beneficial ownership of the stock beneficially owned by any of the others. Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer. The Purchase Agreement provides for, among other things, the acquisition by KFW of the Special Stock and the KFW Warrants. The Purchase Agreement provides for customary representations, warranties, indemnification and other Page 17 provisions, and also provides that KIC, Mr. Kirschbaum and certain other persons shall, subject to certain limitations, give the Company the first right to effect certain transactions in the gaming business that may come to the attention of such persons. A copy of the Purchase Agreement is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. The Stockholders Agreement contains a voting agreement with respect to nomination and election of directors of the Company (see Item 4), certain restrictions on the ability of KFW, KIC, GSA and Mr. Wilms to transfer their shares of Common Stock (or Common Stock equivalents), including mutual rights of first offer in the event of proposed sales of Common Stock or Common Stock equivalents, certain tag-along rights in favor of Mr. Wilms in the event of any proposed transfer of shares of Common Stock by KFW, KIC, GSA and certain other persons and demand and piggy- back registration rights granted to each of KFW, KIC, GSA and Mr. Wilms by the Company. A copy of the Stockholders Agreement is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. KIC and GSA, Inc. have an agreement with Mr. Anthony L. DiCesare pursuant to which Mr. DiCesare will be entitled to receive 20% of the Securities that KIC would be entitled to receive upon the distribution of such securities by KFW to KIC and 20% of the GSA Warrants that GSA, Inc. would be entitled to receive upon the distribution of GSA Warrants from GSA to GSA, Inc. Mr. DiCesare will also be entitled to receive an additional participation if the return on investment of such Securities were to exceed a certain threshold, but only with respect to such excess. At such time that Mr. DiCesare acquires Securities and GSA Warrants as aforesaid, he will become a party to the Stockholders Agreement and otherwise agree that he will vote and, subject to certain exceptions, dispose of his Securities and GSA Warrants only as directed by KIC. In consideration of the Securities and rights to be purchased by Mr. DiCesare, Mr. DiCesare will issue to KIC a promissory note in the amount of 20% of KIC's original cost in respect of the Securities. In addition, KFW has agreed with L.H. Friend, Weinress & Frankson, Inc. ("L.H. Friend") to sell to such firm 10% of the Securities originally purchased by KFW from the Company for a purchase price of $500,000. At such time that L.H. Friend acquires Securities as aforesaid, it will become a party to the Stockholders Agreement and otherwise agree that it will vote and, subject to certain exceptions, dispose of its Securities only as directed by KIC. A copy of a letter agreement between KFW and L.H. Friend is filed as an Exhibit to this Schedule 13D and incorporated in this Item by reference. KFW may in the future enter into agreements with other persons to sell Securities on similar terms. Page 18 Pursuant to his Agreement, Dr. Fields is required to vote all securities of the Company issued or delivered to him in connection with his engagement by the Company for the election of directors as directed and required by KIC pursuant to the Stockholders Agreement. Pursuant to the Gottlieb-KFW Option Agreement and the Robbins-KFW Option Agreement, Mr. Gottlieb and Mr. Robbins, respectively, have options to acquire shares of Special Stock and KFW Warrants. See Item 4. Item 7. Material to be Filed as Exhibits. Exhibit 1 -- Joint Filing Agreement dated March 29, 1995, among Joel Kirschbaum, KIC, KFW, GSA, Craig Fields, Jay R. Gottlieb and David Robbins. Exhibit 2 -- Securities Purchase Agreement dated as of September 21, 1993 among KIC, KFW and the Company (previously filed). Exhibit 3 -- Stockholders Agreement dated as of September 21, 1993 among KIC, KFW, GSA, the Company and Mr. Wilms (previously filed). Exhibit 4 -- Form of Warrant Agreement, dated September 21, 1993, pursuant to which the KFW Warrants were issued. (previously filed). Exhibit 5 -- Letter Agreements, dated March 1, 1994 and July 20, 1993, between KFW and L.H. Friend (previously filed). Exhibit 6 -- Advisory Agreement, dated June 25, 1993, among GSA, the Company and Alfred H. Wilms (previously filed). Exhibit 7 -- Amendment to Stockholders Agreement, dated as of October 20, 1994, among KIC, KFW, GSA, the Company and Mr. Wilms (incorporated by reference from Exhibit 4.5 to the Company's Registration Statement on Form S-3, File No. 33-58233). Exhibit 8 -- Agreement, dated as of September 1, 1994, between the Company and Dr. Fields (incorporated by reference from Exhibit 4.3 to the Company's Registration Statement on Form S-3, File No. 33-58233). Exhibit 9 -- Warrant Agreement, dated as of September 1, 1994, between the Company and Dr. Fields (incorporated by reference from Exhibit 4.4 to the Company's Registration Statement on Form S-3, File No. 33-58233). PAGE Page 19 Exhibit 10 -- Form of Option Agreement, dated as of November 1, 1994, between Jay Gottlieb and KFW. Exhibit 11 -- Form of Amended and Restated Option Agreement, dated as of March 1, 1995, between David Robbins and KFW. PAGE Page 20 SIGNATURE After reasonable inquiry and to the best knowledge and belief of the undersigned, each of the undersigned certifies that the information set forth in this Statement is true, complete and correct. Dated: March 31, 1995 /s/ Joel Kirschbaum Joel Kirschbaum KIRKLAND INVESTMENT CORPORATION By: /s/ Joel Kirschbaum Joel Kirschbaum, President KIRKLAND-FT. WORTH INVESTMENT PARTNERS, L.P. By: Kirkland Investment Corporation, its sole general partner By: /s/ Joel Kirschbaum Joel Kirschbaum, President GAMING SYSTEMS ADVISORS, L.P. By: GSA, Inc., its sole general partner By: /s/Joel Kirschbaum Joel Kirschbaum, President Page 21 /s/ Craig Fields Craig Fields /s/ Jay R. Gottlieb Jay R. Gottlieb /s/ David Robbins David Robbins PAGE Page 22 Sequentially Exhibit No. Description Numbered Page Exhibit 1 Joint Filing Agreement dated March 24 29, 1995, among Joel Kirschbaum, KIC, KFW, GSA, Craig Fields, Jay R. Gottlieb and David Robbins. Exhibit 2 Securities Purchase Agreement dated as of September 21, 1993 among KIC, KFW and the Company (previously filed). Exhibit 3 Stockholders Agreement dated as of September 21, 1993 among KIC, KFW, GSA, the Company and Mr. Wilms (previously filed). Exhibit 4 Form of Warrant Agreement, dated September 21, 1993, pursuant to which the KFW Warrants were issued. (previously filed). Exhibit 5 Letter Agreements, dated March 1, 1994 and July 20, 1993, between KFW and L.H. Friend (previously filed). Exhibit 6 Advisory Agreement, dated June 25, 1993, among GSA, the Company and Alfred H. Wilms (previously filed). Exhibit 7 Amendment to Stockholders Agreement, dated as of October 20, 1994, among KIC, KFW, GSA, the Company and Mr. Wilms (incorporated by reference from Exhibit 4.5 to the Company's Registration Statement on Form S-3, File No. 33-58233). Exhibit 8 Agreement, dated as of September 1, 1994, between the Company and Dr. Fields (incorporated by reference from Exhibit 4.3 to the Company's Registration Statement on Form S-3, File No. 33-58233). PAGE Page 23 Sequentially Exhibit No. Description Numbered Page Exhibit 9 Warrant Agreement, dated as of September 1, 1994, between the Company and Dr. Fields (incorporated by reference from Exhibit 4.4 to the Company's Registration Statement on Form S-3, File No. 33-58233). Exhibit 10 Form of Option Agreement, dated as 26 of November 1, 1994, between Jay Gottlieb and KFW. Exhibit 11 Form of Amended and Restated Option 34 Agreement, dated as of March 1, 1995, between David Robbins and KFW. EX-1 2 EXHIBIT 1 AGREEMENT OF JOINT FILING Page 24 EXHIBIT 1 AGREEMENT OF JOINT FILING Pursuant to Rule 13d-1(f) promulgated under the Securities Exchange Act of 1934, the undersigned persons hereby agree to file with the Securities and Exchange Commission the Statement on Schedule 13D (the "Statement") to which this Agreement is attached as an exhibit, and agree that such Statement, as so filed, is filed on behalf of each of them. IN WITNESS WHEREOF, the undersigned have executed this Agreement. Dated: March 31, 1995 /s/ Joel Kirschbaum Name: Joel Kirschbaum KIRKLAND INVESTMENT CORPORATION By: /s/ Joel Kirschbaum Name: Joel Kirschbaum President KIRKLAND-FT. WORTH INVESTMENT PARTNERS, L.P. By: Kirkland Investment Corporation, its sole general partner By: /s/ Joel Kirschbaum Name: Joel Kirschbaum President Page 25 GAMING SYSTEMS ADVISORS, L.P. By: Joel Kirschbaum, as President of GSA, Inc., the General Partner of Gaming Systems Advisors, L.P. /s/ Joel Kirschbaum Joel Kirschbaum /s/ Craig Fields Craig Fields /s/ Jay R. Gottlieb Jay R. Gottlieb /s/ David Robbins David Robbins PAGE Page 26 Exhibit 10 Kirkland-Ft. Worth Investment Partners, L.P. 9 West 57th Street New York, New York 10019 November 1, 1994 Mr. Jay R. Gottlieb 1040 Lakeshore Drive Apartment 25A Chicago, Illinois 60611 Dear Jay: This letter agreement will set forth the terms and conditions upon which Kirkland-Ft. Worth Investment Partners, L.P., a Delaware limited partnership ("KFW"), and Jay R. Gottlieb (the "Holder") have agreed that KFW has granted to the Holder the option to acquire certain property owned by KFW, as set forth below. The parties agree as follows: 1. Option. (a) This letter agreement confirms that, in consideration of $100 and other good and valuable consideration paid by the Holder to KFW, KFW has granted (and hereby confirms such grant) to the Holder the option (the "Option") to acquire (1)(A) 13,333 shares of Non-Voting Junior Convertible Special Stock, par value $.10 per share, of United Gaming, Inc. (the "Company"), and (B) warrants to acquire an aggregate of 27,500 shares of the Company's Common Stock, par value $.10 per share, which warrants are exercisable in three equal Series (i.e., warrants to acquire 9,167 shares of Common Stock in Series A, warrants to acquire 9,167 shares of Common PAGE Page 27 Stock in Series B and warrants to acquire 9,166 shares of Common Stock in Series C)(such securities described in clauses (A) and (B) above, collectively, the "Securities"), and (2) any cash, securities, property or other assets or rights into or for all or any portion of which the Securities are at any time hereafter exchanged, converted or exercised (the cash, securities, property or other assets or rights described in this clause (2), collectively, the "Securities Proceeds"). (b) The Option shall be exercisable in whole but not in part and shall be exercisable only from and after the date which is 190 days after the date hereof (the "Exercise Date"), and shall not be exercisable prior to the Exercise Date, and shall remain exercisable for a period of five years from and after the Exercise Date; provided, that, notwithstanding the foregoing, the Option shall cease to be exercisable on the earlier of (i) the date which is 30 days after the date upon which KFW shall have transferred or disposed of for cash to unaffiliated third parties such number of the Securities as will result in KFW not owning a sufficient number of Securities otherwise to fulfill its obligations hereunder and (ii) 30 days after the date on which KFW shall have given notice to the Holder that the Option shall be terminated, so long as, in each case, the date described in clauses (i) and (ii) above shall have occurred after the Exercise Date. (c) The aggregate consideration for exercise of the Option shall be $50,000. Such amount shall be payable by the Holder to KFW in cash within 10 business days of the date that the Holder shall have provided notice to KFW that the Holder intends to exercise the Option. Upon such exercise, KFW shall immediately (but in any event within five business days) cause to be delivered to the Holder such Securities (or, if all or a portion of the Securities shall then have been converted, exchanged or exercised for or into other cash, securities, property, assets or rights, Securities and/or Securities Proceeds, as the case may be, in the same proportion that the Securities then bears to such other cash, securities, property, assets or rights). (d) Upon exercise of the Option and delivery from KFW to the Holder of Securities or Securities Proceeds, as applicable, the Holder shall execute the Investor Acceptance in the form attached hereto as Exhibit A. 2. Certain Transfers. Until such time as the Option is exercised in full or released by the Holder, the Option shall affect and be binding upon the Securities and the Securities Proceeds in the hands of any transferee thereof from KFW. KFW shall use commercially reasonable efforts to cause any such transferee to be informed of such restriction and agree to be bound thereby. PAGE Page 28 3. Miscellaneous. (a) The rights and obligations of the parties hereto shall be binding upon and inure to the benefit of the parties' respective successors and assigns. (b) This letter agreement (including the exercise of the Option) shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to principles of conflicts of laws. (c) This letter agreement may be executed in counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument. This letter agreement may be executed and delivered by facsimile transmission. Please indicate your agreement to the foregoing provisions by signing a copy of this letter agreement where indicated below. Very truly yours, Kirkland-Ft. Worth Investment Partners, L.P. By: Kirkland Investment Corporation By:___________________________ Joel Kirschbaum President Agreed to: _______________________ Jay R. Gottlieb PAGE Page 29 Exhibit A Investor Acceptance Date: To: Kirkland-Ft. Worth Investment Partners, L.P. 9 West 57th Street New York, New York 10019 Gentlemen: The undersigned agrees to purchase $________ of the investment of Kirkland-Ft. Worth Investment Partners, L.P. ("KFW") in securities of Alliance Gaming Corporation (the "Company") as described in the letter to which this Acceptance is attached, consisting of (1) _________ shares of Non-Voting Junior Convertible Special Stock and (2) warrants to acquire _________ shares of Common Stock, of Alliance Gaming Corporation (the "Company"), in three equal series with vesting prices (subject to adjustment) of $11, $13 and $15 per share (the securities described in clauses (1) and (2), collectively, the "Securities"). Capitalized terms have the meanings ascribed to them in the letter to which this Acceptance is attached or the Stockholders Agreement of the Company dated September 21, 1993, as amended October 20, 1994 (the "Stockholders Agreement"). The undersigned agrees to and confirms the following: 1. The undersigned represents and warrants that: (a) He or she is acquiring the Securities solely for his or her own account and not as nominee or agent for any other person with a view to, or for offer or sale in connection with, any distribution thereof (within the meaning of the Securities Act of 1933, as amended (the "Securities Act")) that would be in violation of the securities laws of the United States or any state thereof; (b) He or she is knowledgeable, sophisticated and experienced in business and financial matters; he or she has previously invested in securities similar to the Securities and understands the limitations on transfer related thereto (both under the Securities Act and as provided in the Page 30 Stockholders Agreement); he or she is able to bear the economic risk of an investment in the Securities and is presently able to afford the complete loss of such investment; and he or she has been afforded access by the Company to information about the Company (including the opportunity to ask questions or and receive information about the Company from Company representatives), including related to the Company's financial condition, results of operations, business, property, management and prospects sufficient to enable him or her to evaluate his or her investment in the Securities; (c) He or she is an "accredited investor" (as such term is defined in Rule 501(a) of Regulation D under the Securities Act); (d) He or she acknowledges that neither KFW nor Kirkland Investment Corporation ("KIC"), the general partner in KFW (nor any direct or indirect partner or stockholder therein or employee, agent or representative thereof) makes any representation or warranty regarding the Company or the Securities and that neither KFW nor KIC (nor any direct or indirect partner or stockholder therein or employee, agent or representative thereof) shall have any liability to the undersigned with respect thereto; and (e) He or she has read and reviewed the Stockholders Agreement and fully understands the provisions thereof applicable to an investment in the Securities. 2. The undersigned agrees that with respect to his or her ownership of the Securities: (a) As between the undersigned, on the one hand, and KIC, on the other hand, all determinations relating to Transfers (as defined in the Stockholders Agreement) of any of the Securities pursuant to the applicable provisions of Section 4.4(a) (other than Section 4.4(a)(iii), which Transfers by the undersigned may be made in the sole discretion of the undersigned) and Article VII of the Stockholders Agreement shall be made by KIC, in its sole discretion (subject to clause (b) below), and that the undersigned shall have no rights with respect to the making of such determinations (but the undersigned shall be permitted to transfer, sell or dispose of Securities in accordance with the determinations made by KIC); (b) In the event of any proposed Transfer of any Securities (pursuant to Section 4.4(a)(other than Transfers by the undersigned pursuant to Section 4.4(a)(iii)), Articles V or Article VII of the Stockholders Agreement or Page 31 otherwise) or the exercise by Mr. Wilms of any rights pursuant to Articles V, VI or VII of the Stockholders Agreement, then, in any such event, the undersigned agrees that the amount of Securities then owned by the undersigned that shall be permitted to be Transferred or shall be subject to the exercise of such rights by Mr. Wilms, as applicable, shall be determined by (1) determining the amount of securities in the aggregate that are to be the subject of such Transfer or the exercise of such rights, as applicable (i.e., the aggregate amount of securities, without duplication, then owned by each of the undersigned, KFW and KIC (or any direct or indirect partner or stockholder therein), Gaming Systems Advisors, L.P. ("GSA") and GSA, Inc., each Listed Investor, each Permitted Investor and each of the foregoing persons' or entities' respective Permitted Transferees, but not Mr. Wilms or his Permitted Transferees), and (2) multiplying the amount described in clause (1) above by a fraction, the numerator of which is the amount of Securities then owned by the undersigned and the denominator of which is the sum, without duplication, of the aggregate amount of securities, without duplication, then owned by each of the undersigned, KFW and KIC (or any direct or indirect partner or stockholder therein), GSA, each Listed Investor, each Permitted Investor and each of the foregoing persons' or entities' respective Permitted Transferees (but not Mr. Wilms or his Permitted Transferees). Notwithstanding the foregoing, the undersigned shall not be required to dispose of any Securities at such time as shall so be elected by KIC, as described above in this clause (b), but rather, the undersigned shall be permitted, if it so elects, to continue to hold such Securities. In the event that the undersigned elects to hold, rather than to sell or transfer, any Securities, the Securities so held shall thereafter continue to be subject to the provisions of this Section 2; (c) Until such time that the undersigned Transfers of any Securities other than to any Permitted Transferees, he or she (and such Permitted Transferees) shall cause such Securities to be voted, as to all matters at any regular or special meeting of stockholders of the Company, in the manner directed by KIC; (d) The undersigned consents to any and all amendments, modifications, extensions, renewals or other actions that may be taken by KIC with respect to the Stockholders Agreement (so long as, in each case, the effect thereof with respect to the undersigned and the Securities PAGE Page 32 is not more onerous than the corresponding effect on KIC), which amendments, modifications, extensions, renewals or other actions shall be binding on the undersigned pursuant to this Acceptance; and (e) Other than the rights described above in this Acceptance or in the Stockholders Agreement, KIC shall not have any rights with respect to the Securities and, at such time that the applicable provisions of the Stockholders Agreement relating to the Securities shall have lapsed, in accordance with their terms, as amended and in effect from time to time, such provisions shall no longer be applicable to the Securities. 4. Restrictive Legend. The undersigned acknowledges that the Securities issued as of the date hereof in accordance with this Acceptance shall bear a restrictive legend of the type set forth in the Stockholders Agreement. 5. Governing Law. This Acceptance shall be governed by and construed in accordance with the laws of the State of Nevada, without regard to principles of conflicts of laws. 6. Miscellaneous. This Acceptance (a) may be executed in counterparts, each of which shall be deemed an original and all of which shall be deemed one document, (b) may be executed by facsimile signature, (c) contains the entire agreement between the undersigned and KFW relating to any acquisition of Securities, and supersedes all prior agreements or understandings, oral or written, between the undersigned, on the one hand, and KFW, KIC or any of their respective affiliates, on the other hand, relating to such matters, (d) shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto and (e) shall not be effective or binding upon KFW until countersigned below by KFW. The undersigned has executed this Acceptance as of the date first set forth above. Name:___________________________ Address:_________________________ __________________________ __________________________ Social Security or Taxpayer Identification Number:___________________________ Amount of Investment:_______________ Signature:_________________________ PAGE Page 33 Agreed to: Kirkland-Ft. Worth Investment Partners, L.P. By: Kirkland Investment Corporation, its general partner By:____________________________ Joel Kirschbaum President PAGE Page 34 Exhibit 11 Kirkland-Ft. Worth Investment Partners, L.P. 9 West 57th Street New York, New York 10019 March 1, 1995 Mr. David Robbins c/o Kramer, Levin et al. 919 Third Avenue New York, New York 10022 Dear David: This amended and restated letter agreement (a) amends and restates an existing agreement between us dated November 1, 1994, which is cancelled and of no further force and effect, and (b) sets forth the terms and conditions upon which Kirkland-Ft. Worth Investment Partners, L.P., a Delaware limited partnership ("KFW"), and David Robbins (the "Holder") have agreed that KFW has granted to the Holder the option to acquire certain property owned by KFW, as set forth below. The parties agree as follows: 1. Option. (a) This letter agreement confirms that, in consideration of $100 and other good and valuable consideration paid by the Holder to KFW, KFW has granted (and hereby confirms such grant) to the Holder (I) on November 1, 1994, the option (the "First Option") to acquire (1)(A) 10,000 shares of Non-Voting Junior Convertible Special Stock, par value $.10 per share, of Alliance Gaming Corporation (formerly known as United Gaming, Inc.)(the "Company"), and (B) warrants to acquire an aggregate of 20,625 shares of the Company's Common Stock, par value $.10 per share, which warrants are exercisable in three equal Series (i.e., warrants to acquire 6,875 shares of Common Stock in Series A, warrants to acquire 6,875 shares of Common Page 35 Stock in Series B and warrants to acquire 6,875 shares of Common Stock in Series C)(such securities described in clauses (A) and (B) above, collectively, the "Securities"), and (2) any cash, securities, property or other assets or rights into or for all or any portion of which the Securities are at any time hereafter exchanged, converted or exercised (the cash, securities, property or other assets or rights described in this clause (2), collectively, the "Securities Proceeds") and (II) on March 1, 1995, the option (the "Second Option"; together with the First Option, the "Options") to acquire Securities consisting of (1)(A) an additional 10,000 shares of Non-Voting Junior Convertible Special Stock, par value $.10 per share, of the Company, and (B) additional warrants to acquire an aggregate of 20,625 shares of the Company's Common Stock, par value $.10 per share, which warrants are exercisable in three equal Series (i.e., warrants to acquire 6,875 shares of Common Stock in Series A, warrants to acquire 6,875 shares of Common Stock in Series B and warrants to acquire 6,875 shares of Common Stock in Series C), and (2) any Securities Proceeds into or for which all or any portion of the Securities are at any time hereafter exchanged, converted or exercised. (b) Each of the Options shall be exercisable in whole but not in part and shall be exercisable only from and after the date which is 190 days after the applicable date of grant thereof, as set forth above (the "Exercise Date"), and shall not be exercisable prior to the Exercise Date, and shall remain exercisable for a period of five years from and after the Exercise Date; provided, that, notwithstanding the foregoing, the Option shall cease to be exercisable on the earlier of (i) the date which is 30 days after the date upon which KFW shall have transferred or disposed of for cash to unaffiliated third parties such number of the Securities as will result in KFW not owning a sufficient number of Securities otherwise to fulfill its obligations hereunder and (ii) 30 days after the date on which KFW shall have given written notice to the Holder that the Option shall be terminated, so long as, in each case, the date described in clauses (i) and (ii) above shall have occurred after the Exercise Date. (c) The aggregate consideration for exercise of the First Option shall be $37,500 and the aggregate consideration for exercise of the Second Option shall be $37,500. Each such applicable amount shall be payable by the Holder to KFW in cash within 10 business days of the date that the Holder shall have provided notice to KFW that the Holder intends to exercise such Option. Upon such exercise, KFW shall immediately (but in any event within five business days) cause to be delivered to the Holder such Securities (or, if all or a portion of the Securities shall then have been converted, exchanged or exercised for or into other cash, securities, property, assets or rights, Securities and/or Securities Proceeds, as the case may be, in the Page 36 same proportion that the Securities then bears to such other cash, securities, property, assets or rights). (d) Upon exercise of each Option and delivery from KFW to the Holder of Securities or Securities Proceeds, as applicable, the Holder shall execute the Investor Acceptance in the form attached hereto as Exhibit A. 2. Certain Transfers. Until such time as each Option is exercised in full or released by the Holder, such Option shall affect and be binding upon the Securities and the Securities Proceeds in the hands of any transferee thereof from KFW. KFW shall use commercially reasonable efforts to cause any such transferee to be informed of such restriction and agree to be bound thereby. 3. Miscellaneous. (a) The rights and obligations of the parties hereto shall be binding upon and inure to the benefit of the parties' respective successors and assigns. (b) This letter agreement (including the exercise of the Options) shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to principles of conflicts of laws. (c) This letter agreement may be executed in counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument. This letter agreement may be executed and delivered by facsimile transmission. Page 37 Please indicate your agreement to the foregoing provisions by signing a copy of this letter agreement where indicated below. Very truly yours, Kirkland-Ft. Worth Investment Partners, L.P. By: Kirkland Investment Corporation By:___________________________ Joel Kirschbaum President Agreed to: _______________________ David Robbins PAGE Page 38 Exhibit A Investor Acceptance Date: To: Kirkland-Ft. Worth Investment Partners, L.P. 9 West 57th Street New York, New York 10019 Gentlemen: The undersigned agrees to purchase $________ of the investment of Kirkland-Ft. Worth Investment Partners, L.P. ("KFW") in securities of Alliance Gaming Corporation (the "Company") as described in the letter to which this Acceptance is attached, consisting of (1) _________ shares of Non-Voting Junior Convertible Special Stock and (2) warrants to acquire _________ shares of Common Stock, of Alliance Gaming Corporation (the "Company"), in three equal series with vesting prices (subject to adjustment) of $11, $13 and $15 per share (the securities described in clauses (1) and (2), collectively, the "Securities"). Capitalized terms have the meanings ascribed to them in the letter to which this Acceptance is attached or the Stockholders Agreement of the Company dated September 21, 1993, as amended October 20, 1994 (the "Stockholders Agreement"). The undersigned agrees to and confirms the following: 1. The undersigned represents and warrants that: (a) He or she is acquiring the Securities solely for his or her own account and not as nominee or agent for any other person with a view to, or for offer or sale in connection with, any distribution thereof (within the meaning of the Securities Act of 1933, as amended (the "Securities Act")) that would be in violation of the securities laws of the United States or any state thereof; (b) He or she is knowledgeable, sophisticated and experienced in business and financial matters; he or she has previously invested in securities similar to the Securities and understands the limitations on transfer related thereto (both under the Securities Act and as provided in the Page 39 Stockholders Agreement); he or she is able to bear the economic risk of an investment in the Securities and is presently able to afford the complete loss of such investment; and he or she has been afforded access by the Company to information about the Company (including the opportunity to ask questions or and receive information about the Company from Company representatives), including related to the Company's financial condition, results of operations, business, property, management and prospects sufficient to enable him or her to evaluate his or her investment in the Securities; (c) He or she is an "accredited investor" (as such term is defined in Rule 501(a) of Regulation D under the Securities Act); (d) He or she acknowledges that neither KFW nor Kirkland Investment Corporation ("KIC"), the general partner in KFW (nor any direct or indirect partner or stockholder therein or employee, agent or representative thereof) makes any representation or warranty regarding the Company or the Securities and that neither KFW nor KIC (nor any direct or indirect partner or stockholder therein or employee, agent or representative thereof) shall have any liability to the undersigned with respect thereto; and (e) He or she has read and reviewed the Stockholders Agreement and fully understands the provisions thereof applicable to an investment in the Securities. 2. The undersigned agrees that with respect to his or her ownership of the Securities: (a) As between the undersigned, on the one hand, and KIC, on the other hand, all determinations relating to Transfers (as defined in the Stockholders Agreement) of any of the Securities pursuant to the applicable provisions of Section 4.4(a) (other than Section 4.4(a)(iii), which Transfers by the undersigned may be made in the sole discretion of the undersigned) and Article VII of the Stockholders Agreement shall be made by KIC, in its sole discretion (subject to clause (b) below), and that the undersigned shall have no rights with respect to the making of such determinations (but the undersigned shall be permitted to transfer, sell or dispose of Securities in accordance with the determinations made by KIC); (b) In the event of any proposed Transfer of any Securities (pursuant to Section 4.4(a)(other than Transfers by the undersigned pursuant to Section 4.4(a)(iii)), Articles V or Article VII of the Stockholders Agreement or Page 40 otherwise) or the exercise by Mr. Wilms of any rights pursuant to Articles V, VI or VII of the Stockholders Agreement, then, in any such event, the undersigned agrees that the amount of Securities then owned by the undersigned that shall be permitted to be Transferred or shall be subject to the exercise of such rights by Mr. Wilms, as applicable, shall be determined by (1) determining the amount of securities in the aggregate that are to be the subject of such Transfer or the exercise of such rights, as applicable (i.e., the aggregate amount of securities, without duplication, then owned by each of the undersigned, KFW and KIC (or any direct or indirect partner or stockholder therein), Gaming Systems Advisors, L.P. ("GSA"), and GSA, Inc., each Listed Investor, each Permitted Investor and each of the foregoing persons' or entities' respective Permitted Transferees, but not Mr. Wilms or his Permitted Transferees), and (2) multiplying the amount described in clause (1) above by a fraction, the numerator of which is the amount of Securities then owned by the undersigned and the denominator of which is the sum, without duplication, of the aggregate amount of securities, without duplication, then owned by each of the undersigned, KFW and KIC (or any direct or indirect partner or stockholder therein), GSA, each Listed Investor, each Permitted Investor and each of the foregoing persons' or entities' respective Permitted Transferees (but not Mr. Wilms or his Permitted Transferees). Notwithstanding the foregoing, the undersigned shall not be required to dispose of any Securities at such time as shall so be elected by KIC, as described above in this clause (b), but rather, the undersigned shall be permitted, if it so elects, to continue to hold such Securities. In the event that the undersigned elects to hold, rather than to sell or transfer, any Securities, the Securities so held shall thereafter continue to be subject to the provisions of this Section 2; (c) Until such time that the undersigned Transfers of any Securities other than to any Permitted Transferees, he or she (and such Permitted Transferees) shall cause such Securities to be voted, as to all matters at any regular or special meeting of stockholders of the Company, in the manner directed by KIC; (d) The undersigned consents to any and all amendments, modifications, extensions, renewals or other actions that may be taken by KIC with respect to the Stockholders Agreement (so long as, in each case, the effect thereof with respect to the undersigned and the Securities PAGE Page 41 is not more onerous than the corresponding effect on KIC), which amendments, modifications, extensions, renewals or other actions shall be binding on the undersigned pursuant to this Acceptance; and (e) Other than the rights described above in this Acceptance or in the Stockholders Agreement, KIC shall not have any rights with respect to the Securities and, at such time that the applicable provisions of the Stockholders Agreement relating to the Securities shall have lapsed, in accordance with their terms, as amended and in effect from time to time, such provisions shall no longer be applicable to the Securities. 3. Restrictive Legend. The undersigned acknowledges that the Securities issued as of the date hereof in accordance with this Acceptance shall bear a restrictive legend of the type set forth in the Stockholders Agreement. 4. Governing Law. This Acceptance shall be governed by and construed in accordance with the laws of the State of Nevada, without regard to principles of conflicts of laws. 5. Miscellaneous. This Acceptance (a) may be executed in counterparts, each of which shall be deemed an original and all of which shall be deemed one document, (b) may be executed by facsimile signature, (c) contains the entire agreement between the undersigned and KFW relating to any acquisition of Securities, and supersedes all prior agreements or understandings, oral or written, between the undersigned, on the one hand, and KFW, KIC or any of their respective affiliates, on the other hand, relating to such matters, (d) shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto and (e) shall not be effective or binding upon KFW until countersigned below by KFW. The undersigned has executed this Acceptance as of the date first set forth above. Name:___________________________ Address:_________________________ __________________________ __________________________ Social Security or Taxpayer Identification Number:___________________________ Amount of Investment:_______________ Signature:_________________________ Page 42 Agreed to: Kirkland-Ft. Worth Investment Partners, L.P. By: Kirkland Investment Corporation, its general partner By:____________________________ Joel Kirschbaum President -----END PRIVACY-ENHANCED MESSAGE-----