LV gaming supplier settles shareholder lawsuits for $2.2 mil.

Friday, Sept. 29, 2000 | 11:37 a.m.

Acres Gaming Inc., a Las Vegas-based supplier to casino slot floors, said it reached a verbal agreement to settle shareholder lawsuits alleging it violated federal securities laws when its officers made false and misleading statements or omissions about its finances and business prospects.

Acres agreed to pay pay $660,000 in cash, of which approximately $200,000 will come from the company's insurance carrier, and issue warrants to purchase 1 million shares of the company's common stock, exercisable over a 10-year period, at a price of $2.50 per share.

The value of the warrants is about $1.6 million. The company recorded a one-time charge of $2 million to account for the settlement. This will boost the firm's fiscal 2000 net loss to $4.2 million or 47 cents per share.

Acres said two related lawsuits had been filed in U.S. District Court in Las Vegas and that they were combined and received class certification for a class consisting of the purchasers of the company's common stock from March 26, 1997, to Dec. 11, 1997.

"We are pleased to get this matter behind us," said Bud Glisson, Acres' chairman and chief executive officer. "Continuing the litigation in the courts is expensive and distracting. Management resources are better served focusing on the numerous business opportunities ahead of us."