Progressive Gaming International files for bankruptcy

The company, which provided gaming systems and other technology to casinos, owes more than us$ 5.6 million to unsecured creditors, according to a Monday filing with the U.S. Bankruptcy Court in Nevada. Progressive Gaming said it had assets of us$ 263,600.

The largest amount claimed by an unsecured creditor is us$ 1 million owed to Hasbro Inc., stemming from a lawsuit the toymaker settled with Progressive in 2007. The bulk of what Progressive owes is for professional services, such as attorneys, accountants and consultants, as well as other corporate expenses. IGT has claims for us$ 322,000, Harrah’s Entertainment is seeking us$ 101,000, and Gaming Laboratories International is seeking us$ 244,000.

All of Progressive Gaming’s board members are listed as unsecured creditors, seeking payments of between us$ 2,000 and us$ 21,000. The company’s board voted January 26 to be liquidated. The firm was forced into a foreclosure sale when it failed to meet a payment deadline in January on us$ 17 million it owed to Private Equity Management Group of Irvine, California.

IGT acquired the bulk of the company’s assets for an undisclosed price and planned to merge the global operations of Progressive Gaming with its offices. IGT had loaned Progressive us$ 15 million last August through a convertible note. The companies had other technology-related joint venture agreements.

At the time of the foreclosure sale, Progressive Gaming owned patents for casino management systems that were connected to 70,000 slot machines worldwide. The company earned revenue through the sale of the software and hardware associated with the systems and maintenance agreements.

Progressive Gaming was formed in 1986 as the Mikohn Gaming Corp. The company sold its slot machine and table game businesses and transitioned into a pure gaming technology company, but never recovered from a financial meltdown in 2007. Its stock price fell almost 75 % and wiped out some us$ 200 million in market capitalization.

The majority of Progressive Gaming’s upper management left the company last fall. According to its most recent quarterly earnings report, Progressive had losses of us$ 63.6 million for the three months ended September 30, 2008, on revenues of us$ 13.7 million.