SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
April 26, 1999
--------------------------------
(Date of earliest event reported)
SPINTEK GAMING TECHNOLOGIES, INC.
Nevada
--------------------------------------------
(State or other jurisdiction of incorporation)
0-27226 33-0134823
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(Commission (IRS Employer
File Number) Identification No.)
1857 Helm Drive
Las Vegas, Nevada 89119
- ----------------- -----
(Address of principal executive offices) (Zip Code)
(702) 263-3660
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Registrant's telephone number,
including area code
<PAGE>
Item 5. Other Events
On April 26, 1999, Spintek Gaming Technologies, Inc. (the "Company")
received certain notices of conversion in accordance with the terms of its
Series A 4% Convertible Preferred Stock (the "Preferred Stock") and its 6%
Secured Convertible Notes Due February 28, 2008 (the "Notes"). As a consequence
of the conversion of the Preferred Stock and the Notes, the Company has
calculated the outstanding stock options of the Company pursuant to existing
stock option agreements granted pursuant to the Company's 1996 Stock Option Plan
(the "Plan") and the anti-dilution provisions contained therein. The conversions
in respect of the Preferred Stock and Notes result in the issuance of
123,722,581 shares of the Company's $.002 par value common stock (the "Common
Stock"). Following the conversions and upon issuance of all shares, the Company
has 142,554,846 shares of its Common Stock issued and outstanding and no shares
of its Preferred Stock issued and outstanding. Since the Preferred Stock and
Notes conversions, and the resultant effect upon certain stock options, resulted
in the number of shares of Common Stock to be issued exceeding the number of
shares authorized, the Company has amended its Articles of Incorporation. The
details relating to each of the conversions, the effect of the conversion upon
certain stock options, and the authorization of additional shares of the Common
Stock of the Company are discussed fully below.
Conversion of Preferred Stock. On April 26, 1999, the Company received
Notices of Conversion of the conversion privilege from RBB Bank
Aktiengesellschaft ("RBB Bank"), as shareholder of the Preferred Stock of the
Company. Under the terms of the Certificate of Designation for the Preferred
Stock, RBB Bank is entitled to convert the Preferred Stock into that number of
shares of the Common Stock of the Company as derived from the formula:
[(.04) (N/365) (1,000)] + 1,000
-------------------------------
"Conversion Price"
The "Conversion Price" is the average closing bid price of the Company's Common
Stock for the five (5) trading days immediately preceding written notice to the
Company. For purposes of the formula, "N" is equal to the number of days between
the date of issuance of the Preferred Stock and the applicable date of
conversion. Pursuant to the Notice of Conversion, the average Conversion Price
on that date was $0.1735 per share of the Common Stock. The total number of
shares of the Common Stock issued pursuant to the conversion of the Preferred
Stock is 51,837,334, said shares issued to RBB Bank in two separate
transactions. Pending the amendment to the Company's Articles of Incorporation
increasing the Company's authorized shares of common stock, one-half of the
shares of the Common Stock were issued on April 28, 1999 and the balance of the
shares of the Common Stock were issued on May 6, 1999, subsequent to the
increase of authorized shares.
Conversion of Notes. Also on April 26, 1999, the Company received
Notice of Exercise of the conversion privilege from holders of its Notes (the
"Holders") effective April 29, 1999. Under the terms of the Notes, the Holders
are entitled to convert the Notes into shares of the Company's Common Stock in a
number equal to forty percent (40%) in the aggregate (assuming conversion of all
$5 million of the outstanding Notes) of the then outstanding shares of Common
Stock (or four-tenths of one percent (.4%) for each $50,000 Unit of the then
outstanding shares of Common Stock). The total number of shares of the Common
Stock issued pursuant to the conversion is 71,885,247, said shares also issued
to the Holders in two separate transactions. Pending the amendment to the
2
<PAGE>
Company's Articles of Incorporation increasing the Company's authorized shares
of common stock, one-half of the shares of the Common Stock were issued on April
29, 1999 and the balance of the shares of the Common Stock were issued on May 6,
1999, subsequent to the increase of authorized shares.
Effect of Conversion upon Existing Stock Options. The Company has
calculated the outstanding stock options of the Company pursuant to existing
stock option agreements granted pursuant to the Company's 1996 Stock Option Plan
(the "Plan") and the anti-dilution provisions contained therein as a result of
the conversion of the Preferred Stock and the Notes. Based upon the
anti-dilution provisions, options to acquire an additional 38,471,033 shares of
the Common Stock of the Company were granted. As of May 7, 1999, there are
44,779,485 shares of Common Stock subject to options granted under the Plan, of
which 36,782,056 stock options are currently exercisable. Included in these
figures are options granted to directors and executive officers of the Company
totaling 27,032,288, all of which are currently exercisable. On May 7, 1999, the
Board of Directors, with the approval of the shareholders holding a majority of
the shares of Common Stock of the Company, increased the number of shares of the
Common Stock authorized under the Plan from 4,000,000 to 60,000,000 shares.
Authorization of Common Stock. The conversion of the Notes and
Preferred Stock, as well as the application of the anti-dilution provisions of
the Stock Options, compelled the authorization of additional shares of the
Common Stock under the Articles of Incorporation and Bylaws of the Company
pursuant to Nevada law. Nevada law provides that a corporation desiring to
change the number of shares of a class of its authorized stock may, absent a
contrary provision in its articles of incorporation, do so by board resolution
without shareholder approval only if there is a corresponding increase or
decrease in the number of issued and outstanding shares of the same class held
by each shareholder of record at the effective date. Since the increase in
number of authorized shares of the Company will not result in a corresponding
increase in the number of shares held by each shareholder of record on April 30,
1999 (i.e., the effective date), the Company was required to seek shareholder
approval.
Nevada law further provides that any action required to be taken at a
meeting of the shareholders of a corporation may be taken without a meeting by
written consent of the shareholders holding a majority of the voting power
unless otherwise provided in the articles of incorporation or bylaws. The Board
of Directors of the Company adopted a resolution at a duly called meeting on
April 30, 1999, authorizing an increase in the number of shares of the Common
Stock authorized to 500,000,000 shares, par value $0.002 per share. The Company,
in accordance with Nevada law, timely received the written consent of the
shareholders holding a majority of the shares of its Common Stock issued and
outstanding effective April 30, 1999. The financial interests of certain
directors and officers of the Company were known to the shareholders providing
such written consent.
Pursuant to the approval of the shareholders holding a majority of the
shares of Common Stock of the Company, the Company filed with the Nevada
Secretary of State a Certificate of Amendment of Articles of Incorporation
effective May 3, 1999. A copy of the Articles of Incorporation, as amended, is
attached hereto at Exhibit 3.2.
3
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits
3.1. Certificate of Amendment of Articles of Incorporation
3.2. Articles of Incorporation (as amended)
4.1. Notices of Exercise
4.2. Notices of Conversion
99.1. Press Release
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: May 10, 1999
SPINTEK GAMING TECHNOLOGIES, INC.
By: /s/ Gary L. Coulter
-------------------
Gary L. Coulter,
Chairman of the Board and
Chief Executive Officer
EXHIBIT 3.1
Certificate of Amendment of Articles of Incorporation
<PAGE>
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After Issuance of Stock)
SPINTEK GAMING TECHNOLOGIES, INC.,
a Nevada corporation
We the undersigned vice president and secretary, of Spintek Gaming
Technologies, Inc. do hereby certify:
That the Board of Directors of said corporation at a meeting duly convened,
held on the 30th day of April, 1999, adopted a resolution to amend the original
articles as follows:
Article III is hereby amended to read as follows:
The number of shares with par value: 500,000,000
Par value: $.002
Number of shares without par value: 100,000
Article 6.1 is hereby amended to read as follows:
ADDITIONAL INFORMATION ON SHARES. This Corporation is
authorized to issue five hundred million one hundred thousand
(500,100,000) shares of capital stock consisting of five
hundred million (500,000,000) shares of common stock, each
with a $.002 par value, and one hundred thousand (100,000)
shares of preferred stock without a par value. As to the
preferred stock of the Corporation, the power to issue any
shares of preferred stock of any class or any series of any
class and designation, numbers, voting powers, or the denial
of voting powers, preferences, and relative, participating,
optional, or other rights, if any, or the qualifications,
limitations, restrictions thereof, shall be determined by the
Board of Directors.
The number of shares of the corporation outstanding and entitled to vote on
an amendment to the Articles of Incorporation is 80,455,953; that the said
changes and amendment have been consented to and approved by a majority vote of
the stockholders holding at least a majority of each class of stock outstanding
and entitled to vote thereon.
/s/ Judy Karabin
----------------------------------
President or Vice President
----------------------------------
Secretary or Assistant Secretary
State of Nevada
-------
ss.
County of Clark
-------
On May 3, 1999, personally appeared before me, a Notary Public, Judy
Karabin, who acknowledged that she executed the above instrument.
/s/ Rosemarie E. Carlo
--------------------------------
Notary Public
(NOTARY STAMP OR SEAL)
<PAGE>
----------------------------------
President or Vice President
/s/ Erik R. Batzloff
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Secretary or Assistant Secretary
State of _____________________
ss.
County of ____________________
On ____________________ , personally appeared before me, a Notary Public,
Robert E. Huggins, who acknowledged that he executed the above instrument.
___________________________________
Notary Public
(NOTARY STAMP OR SEAL)
EXHIBIT 3.2
-----------
Articles of Incorporation
of Spintek Gaming Technologies, Inc.,
a Nevada corporation
(as originally filed)
<PAGE>
Filing Fee:
Receipt #:
Articles of Incorporation
(Pursuant to NRS 78)
STATE OF NEVADA
Secretary of State
(For filing office use) ________________________________ (For filing office use)
_______________________________________________________________________________
IMPORTANT: Read instructions on reverse side before completing this form.
TYPE OR PRINT (BLACK INK ONLY)
1. NAME OF CORPORATION: Spintek Gaming Technologies, Inc.
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2. RESIDENT AGENT: (designated resident agent and his STREET ADDRESS in Nevada
where process may be served)
Name of Resident Agent: Robert E. Huggins
-------------------------------------------------
Street Address: 901 Grier Drive, Suite B Las Vegas 89119
------------------------------------------------------------
Street No. Street Name City Zip
3. SHARES: (number of shares the corporation is authorized to issue)
Number of share with par value: 100,000,000 Par value: $.002 Number of
shares without par value: 100,000
4. GOVERNING BOARD: shall be styled as (check one): _X_ Directors ___Trustees
The FIRST BOARD OF DIRECTORS shall consist of 3 members and the names and
addresses are as follows (attach additional pages if necessary):
Gary L. Coulter 901 Grier Dr., Ste. B, Las Vegas, NV 89119
--------------- -----------------------------------------------
Name Address City/State/ Zip
Malcolm C. Davenport, V 901 Grier Dr., Ste. B, Las Vegas, NV 89119
----------------------- -----------------------------------------------
Name Address City/State/Zip
5. PURPOSE (optional - see reverse side): The purpose of the corporation shall
be:
------------------------------------------------------------------------
6. OTHER MATTERS: This form includes the minimal statutory requirements to
incorporate under NRS 78. You may attach additional information pursuant to
NRS 78.037 or any other information you deem appropriate. If any of the
additional information is contradictory to this form it cannot be filed and
will be returned to you for correction. Number of pages attached 1 .
------
7. SIGNATURES OF INCORPORATORS: The names and addresses of each of the
incorporators signing the articles: (Signatures must be notarized) (Attach
additional pages if there are more than two incorporators.)
Robert A. Penman
----------------- --------------------
Name (print) Name (print)
127 Peachtree St., N.E., Ste. 1600
--------------------------------------------------------------------------
Address Atlanta, GA 30303-1845 City/State/Zip Address City/State/Zip
/S/ Robert A. Penman
------------------------------ --------------------
Signature Signature
State of Georgia County of Fulton State of County of
------- ------- ------- -------
<PAGE>
This instrument was acknowledged before This instrument was acknowledged before
me on December 3, 1997, by me on , 19 , by
----------------------- ----------------- -----
Robert A. Penman
-------------------------------- -----------------------------
Name of Person Name of Person
as incorporator as incorporator
of Spintek Gaming Technologies, Inc. of
--------------------------------- ------------------------------
(name of party on behalf of whom (name of party on behalf of whom
instrument was executed instrument was executed)
/s/ Karetha A. Milton
------------------------- ------------------------------
Notary Public Signature Notary Public Signature
Notary Public, Gwinnett County, Georgia
My Commission Expires March 3, 2000
(affix notary stamp or seal) (affix notary stamp or seal)
8. CERTIFICATE OF ACCEPTANCE OF APPOINTMENT OF RESIDENT AGENT
I, Robert E. Huggins hereby accept appointment as Resident Agent for the above
------------------
named corporation.
- -------------------------------- ------------------------------
Signature of Resident Agent Date
<PAGE>
ARTICLE IV
FIRST BOARD OF DIRECTORS
4.1 THIRD DIRECTOR.
-------------------
Patrick W. McGrath 901 Grier Drive, Ste. B, Las Vegas, NV 89119
ARTICLE VI
OTHER MATTERS
6.1 ADDITIONAL INFORMATION ON SHARES. This Corporation is authorized to
issue One Hundred Million One Hundred Thousand (100,100,000) shares of capital
stock consisting of One Hundred Million (100,000,000) shares of common stock,
each with a $.002 par value, and One Hundred Thousand (100,000) shares of
preferred stock without a par value. As to the preferred stock of the
Corporation, the power to issue any shares of preferred stock of any class or
any series of any class and designation, numbers, voting powers, or the denial
of voting powers, preferences, and relative, participating, optional or other
rights, if any, or the qualifications, limitations, or restrictions thereof,
shall be determined by the Board of Directors.
6.2 PERSONAL LIABILITY OF DIRECTORS AND OFFICERS. A Director or officer
of the Corporation shall not be personally liable to the Corporation or its
stockholders for monetary damages for any breach of fiduciary duty as a Director
or officer, except for liability for (a) acts or omissions which involve
intentional misconduct, fraud or a knowing violation of the law or (b) the
payment of distributions in violation of Section 78.300 of the Nevada Revised
Statutes.
<PAGE>
CERTIFICATE OF DESIGNATION, NUMBER, POWERS,
PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL, AND OTHER SPECIAL RIGHTS AND THE
QUALIFICATIONS, LIMITATIONS, RESTRICTIONS,
AND OTHER DISTINGUISHING CHARACTERISTICS OF
SERIES A PREFERRED STOCK
OF
SPINTEK GAMING TECHNOLOGIES, INC.
It is hereby certified that:
1 The name of the corporation (hereinafter called the "Corporation")
is SPINTEK GAMING TECHNOLOGIES, INC. a Nevada corporation.
2 The articles of incorporation of the Corporation authorizes the
issuance of 100,000 shares of Preferred Stock, no par value per share, and
expressly vests in the Board of Directors of the Corporation the authority
provided therein to issue any or all of said shares in one or more series and by
resolution or resolutions to establish the designation, number, full or limited
voting powers, or the denial of voting powers, preferences and relative,
participating, optional, and other special rights and the qualifications,
limitations, restrictions, and other distinguishing characteristics of each
series to be issued.
3 The Board of Directors designated Fifteen Thousand (15,000) of the
One Hundred Thousand (100,000) authorized shares of Preferred Stock of the
Corporation as Series A Preferred Stock.
4 None of the shares designated Series A Preferred Stock have been
issued prior to this Certificate of Determination.
5 The Board of Directors of the Corporation, pursuant to the authority
expressly vested in it as aforesaid, has adopted the following resolutions
creating a Series A issue of Preferred Stock:
RESOLVED, that 15,000 of the 100,000 authorized shares of Preferred
Stock of the Corporation shall be designated Series A Preferred Stock (the
"Series A Preferred Stock") and shall possess the rights and privileges set
forth below:
A. Dividends.
----------
(i) The holder of each issued and outstanding
share of Series A Preferred Stock shall be entitled to receive, when and as
declared by the Board of Directors of the Corporation, out of the assets at the
time legally available for such purpose, dividends at a rate of 4% of the
liquidation preference per annum, payable in cash or in stock. Such dividends
shall not be cumulative and no right to such dividends shall accrue to holders
of Series A Preferred Stock
<PAGE>
unless declared by the Corporation's Board of Directors. No other dividends
shall be declared or paid with respect to the Corporation's Common Stock (other
than a dividend payable solely in Common Stock of the Corporation), or upon any
other class of Preferred Stock of the Corporation with a dividend preference
subordinate to the dividend preference of the Series A Preferred Stock, unless a
dividend of equal or greater amount per share (on an as-if-converted to Common
Stock basis) is first declared and paid with respect to the Series A Preferred
Stock.
(ii) No dividends shall be paid on the Series A
Preferred Stock at such time as:
(a)such payment would violate Nevada law; or
(b)such payment would impair the net capital
or other financial requirements applicable to the Corporation established by the
National Association of Securities Dealers, Inc., the Securities and Exchange
Commission, or any other state or federal securities authority or agency, any
state or federal commodities authority or agency, or any commodities or
securities exchange.
B. Liquidation Preference.
-----------------------
(i) In the event of any liquidation, dissolution
or winding-up of the Corporation, either voluntary or involuntary (a
"Liquidation"), the holders of shares of the Series A Preferred Stock then
issued and outstanding shall be entitled to be paid out of the assets of the
Corporation available for distribution to its shareholders, whether from
capital, surplus or earnings, before any payment shall be made to the holders of
shares of the Common Stock or upon any other series of Preferred Stock of the
Corporation with a liquidation preference subordinate to the liquidation
preference of the Series A Preferred Stock, an amount equal to one thousand
dollars ($1,000) per share. If, upon any Liquidation of the Corporation, the
assets of the Corporation available for distribution to its shareholders shall
be insufficient to pay the holders of shares of the Series A Preferred Stock and
the holders of any other series of Preferred Stock with a liquidation preference
equal to the liquidation preference of the Series A Preferred Stock shall
receive all of the assets of the Corporation available for distribution and each
such holder of shares of the Series A Preferred Stock and the holders of any
other series of Preferred Stock with a liquidation preference equal to the
liquidation preference of the Series A Preferred Stock shall share ratably in
any distribution in accordance with the amounts due such shareholders. After
payment shall have been made to the holders of shares of the Series A Preferred
Stock of the full amount to which they shall be entitled, as aforesaid, the
holders of shares of the Series A Preferred Stock shall be entitled to no
further distributions thereon and the holders of shares of the Common Stock and
of shares of any other series of stock of the Corporation shall be entitled to
share, according to their respective rights and preferences, in all remaining
assets of the Corporation available for distribution to its shareholders.
(ii) A merger or consolidation of the Corporation
with or into any other corporation, or a sale, lease, exchange, or transfer of
all or any part of the assets of the Corporation which shall not in fact result
in the liquidation (in whole or in part) of the Corporation and the
<PAGE>
distribution of its assets to its shareholders shall not be deemed to be a
voluntary or involuntary liquidation (in whole or in part), dissolution, or
winding-up of the Corporation.
C. Conversion of Series A Preferred Stock
--------------------------------------
The holders of Series A Preferred Stock shall have
the following conversion rights:
(i) Right to Convert. Each share of Series A
Preferred Stock shall be convertible, on the Conversion Dates and at the
Conversion Prices set forth below, into fully paid and nonassessable shares of
Common Stock.
(ii) Mechanics of Conversion. Each holder of
Series A Preferred Stock who desires to convert the same into shares of Common
Stock shall provide notice ("Conversion Notice") via telecopy to the
Corporation. The original Conversion Notice and the certificate or certificates
representing the Series A Preferred Stock for which conversion is elected, shall
be delivered to the Corporation by international courier, duly endorsed. The
date upon which a Conversion Notice is properly received by the Corporation
shall be a "Notice Date."
The Corporation shall use all reasonable efforts to issue and deliver
within three (3) business days after the Notice Date, to such holder of Series A
Preferred Stock at the address of the holder on the stock books of the
Corporation, a certificate or certificates for the number of shares of Common
Stock to which the holder shall be entitled as aforesaid; provided that the
original shares of Series A Preferred Stock to be converted are received by the
transfer agent or the Corporation within three business days after the Notice
Date and the person or persons entitled to receive the shares of Common Stock
issuable upon such conversion shall be treated for all purposes as the record
holder or holders of such shares of Common Stock on such date. If the original
shares of Series A Preferred Stock to be converted are not received by the
transfer agent or the Corporation within three business days after the Notice
Date, the Conversion Notice shall become null and void.
(iii) Conversion Dates. The Series A Preferred
Stock shall become convertible into shares of Common Stock at any time
commencing forty-five (45) days after the last day on which there is an original
issuance of Series A Preferred Stock (the "Conversion Date").
(iv) Conversion Price. Each share of Series A
Preferred Stock shall be convertible into the number of shares of Common Stock
according to the following formula:
<PAGE>
[(.04) (N/365) (1,000)] + 1,000
-------------------------------
Conversion Price
N= the number of days between (i) the date of issuance of the
Series A Preferred Stock and (ii) the applicable date of
conversion for the Series A Preferred Stock for which
conversion is being elected.
Conversion
rice of the Corporation's Common
Stock for the five (5) trading days immediately preceding
the Notice Date.
(v) Automatic Conversion. Each share of Series
A Preferred Stock outstanding on December 31, 1999 automatically shall be
converted into Common Stock on such date as the Conversion Price then in effect,
and December 31, 1999 shall be deemed to be the Notice Date with respect to such
conversion. The Company shall have no right to force conversion of any
outstanding shares of Series A Preferred Stock prior to December 31, 1999.
(vi) Fractional Shares. No fractional share
shall be issued upon the conversion of any shares, share or fractional share of
Series A Preferred Stock. All shares of Common Stock (including fractions
thereof) issuable upon conversion of shares (or fractions thereof) of Series A
Preferred Stock by a holder thereof shall be aggregated for purposes of
determining whether the conversion would result in the issuance of any
fractional share. If, after the aforementioned aggregation, the conversion would
result in the issuance of a fraction of a share of Common Stock, the Corporation
shall, in lieu of issuing any fractional share, pay the holder otherwise
entitled to such fraction a sum in cash equal to the closing bid price of the
Corporation's Common Stock on the Notice Date multiplied by such fraction.
(vii) Reservation of Stock Issuable Upon Conversion.
The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the share so the Series A Preferred Stock, such
number of its shares of Common Stock as shall from time to time be sufficient to
effect the conversion of all then outstanding shares of the Series A Preferred
Stock; and if at any time the number of authorized but unissued shares of Common
Stock shall not be sufficient to effect the conversion of all then outstanding
shares of the Series A Preferred Stock, the Corporation will take such corporate
action as may be necessary to increase its authorized but unissued shares of
Common Stock to such number of shares as shall be sufficient for such purpose.
(viii) Adjustment to Conversion Price.
(a) If, prior to the conversion of all
shares of Series A Preferred Stock at a time when conversion would be at the
Conversion Price, there is a stock split, stock dividend, or other similar event
which occurs during the five-day period utilized to compute the Conversion
Price, then the Closing Bid Price to compute the Conversion Price shall be
appropriately adjusted to reflect, as deemed equitable and appropriate by the
Corporation, such stock split, stock dividend or other similar event.
<PAGE>
(b) If, prior to the conversion of all
shares of Series A Preferred Stock, there shall be any merger, consolidation,
exchange of shares, recapitalization, reorganization, or other similar event, as
a result of which shares of Common Stock of the Corporation shall be changed
into the same or a different number of shares of the same or another class or
classes of stock or securities of the Corporation or another entity, then the
holders of Series A Preferred Stock shall thereafter have the right to purchase
and receive upon conversion of shares of Series A Preferred Stock, upon the
basis and upon the terms and conditions specified herein and in lieu of the
shares of stock and/or securities as may e issued or payable with respect to or
in exchange for the number of shares of Common Stock immediately theretofore
purchaseable and receivable upon the conversion of shares of Series A Preferred
Stock held by such holders had such merger, consolidation, exchange of shares,
recapitalization or reorganization not taken place, and in any case appropriate
provisions shall be made with respect to the rights and interests of the holders
of the Series A Preferred Stock to the end that the provisions hereof
(including, without imitation, provisions for adjustment of the Conversion Price
and of the number of shares issuable upon conversion of the Series A Preferred
Stock) shall thereafter be applicable, as nearly as may be practicable in
relation to any shares of stock or securities thereafter deliverable upon the
exercise hereof. The Corporation shall effect any transaction described in this
subsection unless the resulting successor or acquiring entity (if not the
Corporation) assumes by written instrument the obligation to deliver to the
holders of the Series A Preferred Stock such shares of stock and/or securities
as, in accordance with the foregoing provisions, the holders of the Series A
Preferred Stock may be entitled to purchase.
(c) If any adjustment under this
subsection would create a fractional share of Common Stock or a right to acquire
a fractional share of Common Stock, such fractional share shall be disregarded
and then number of shares of Common Stock issuable upon conversion shall be the
next higher number of shares.
D. Redemption.
(i) Right to Redeem on Conversion. The Corporation
shall have the right, in it sole discretion, upon receipt of a notice of
conversion pursuant to Section C, to redeem in whole or in part any shares of
Series A Preferred Stock submitted for conversion, immediately prior to
conversion. If the Corporation elects to redeem some, but not all, of the shares
of Series A Preferred Stock submitted for conversion, the Corporation shall
redeem from among the shares of Series A Preferred Stock submitted by the
various shareholders for conversion on the applicable date, a pro-rata amount
from each shareholder so submitting shares of Series A Preferred Stock for
conversion.
(ii) Mechanics of Redemption on Conversion. The
Corporation shall effect each such redemption by giving notice of its election
to redeem, by facsimile within 1 business day following receipt of a notice of
conversion from a Holder, with a copy by 2-day Courier, to the Holder of shares
of Series A Preferred Stock submitted for conversion at the address and
facsimile number of such Holder appearing in the Corporation's register for the
Series A Preferred Stock. Such redemption notice shall indicate whether the
Corporation will redeem all or part of the shares of Series A Preferred Stock
submitted for conversion and the applicable redemption price. The Corporation
shall not be entitled to send any notice of redemption and begin
<PAGE>
the redemption procedure unless it has the full amount of the redemption price,
in cash, available in a demand or other immediately available account in a bank
or similar financial institution on the date the redemption notice is sent to
shareholders.
The redemption price per shares of Series A Preferred Stock shall be
calculated in accordance with the following formula:
Principal + Interest x Closing Bid Price
--------------------
Conversion Price
For the purposes of the above formula, "Principal", "Interest",
"Closing Bid Price" and "Conversion Price" shall have the meanings set forth in
Section C.
The redemption price shall be paid to the Holder of shares of Series A
Preferred Stock redeemed within 10 business days of the delivery of the notice
of such redemption to such Holder; provided, however, that the Corporation shall
not be obligated to deliver any portion of such redemption price unless either
the certificates evidencing the shares of Series A Preferred Stock redeemed are
delivered to the Corporation or its transfer agent as provided in Section C, or
the Holder notifies the Corporation or its transfer agent that such certificates
have been lost, stolen or destroyed and executes an agreement satisfactory to
the Corporation to indemnify the Corporation from any loss incurred by it in
connection with such certificates.
(iii) Redemption on Asset Sale. In the event the
Corporation enters into a transaction or series of transactions to sell all or
substantially all of its assets, the Corporation shall, within seven days after
the closing of such transaction and after giving at least 15 days advance
written notice of such transaction (which notice shall specify the date that
such redemption is to be effected, which date is referred to hereinafter as the
"Effective Date of Redemption"), redeem the shares of Series A Preferred Stock
for cash. The redemption price in such event ("Redemption Price on Asset Sale")
shall be calculated in accordance with the formula set forth in Section D(ii)
above.
Upon the close of the transaction causing redemption under this Section
D(iii), the Corporation shall deposit the Redemption Price on Asset Sale for all
outstanding shares of Series A Preferred Stock with a bank or trust company
having aggregate capital and surplus in excess of $50,000,000 as a trust fund
for the benefit of the respective holders of the Series A Preferred Stock
designated for redemption and not yet redeemed. Simultaneously, the Corporation
shall deposit irrevocable instruction and authority to such bank or trust
company to publish the notice of redemption thereof (or to complete such
publication if theretofore commenced) and to pay, on and after the date fixed
for redemption or prior thereto, the Redemption Price on Asset Sale to the
holders of the Series A Preferred Stock upon surrender of their certificates.
(iv) Redemption on Change of Control. In the event
of a Change of Control (as hereinafter defined), the shares of Series A
Preferred Stock shall be redeemed by the Corporation for cash at a redemption
price calculated in accordance with the formula set forth in Section D(ii)
above.
<PAGE>
For purposes of this Section D(iv), Change of Control shall be deemed
to have occurred at such time as:
(a) any person (other than the Corporation,
any Subsidiary of the Corporation or any employee benefit plan of the
Corporation) ("Person"), is or becomes the beneficial owner, directly or
indirectly, through a purchase, merger or other acquisition or transaction or
series of transactions, of shares of capital stock of the Corporation entitling
such Person to exercise 50% or more of the total voting power of all shares of
capital stock of the Corporation entitled to vote generally in the election of
directors (any shares of voting stock of which such person or group is the
beneficial owners that are not then outstanding for purposes of calculating such
percentage); or
(b) any consolidation of the Corporation
with, or merger of he Corporation into, any other Person, any merger of another
Person into the Corporation (other than a merger (x) which does not result in
any reclassification, conversion, exchange or cancellation of outstanding share
of Common Stock or (y) which is effected solely to change the jurisdiction of
incorporation of the Corporation and results in a reclassification, conversion
or exchange of outstanding shares of Common Stock into solely shares of Common
Stock).
(v) No Other Redemption. The Corporation shall have
the right to redeem the Series A Preferred Stock except as provided in Section D
hereof.
E. Voting. Except as otherwise provided by the General
Corporation Law of the State of Nevada, the holders of the Series A Preferred
Stock shall have no voting power whatsoever, and no holder of Series A Preferred
Stock shall vote or otherwise participate in any proceeding in which actions
shall be taken by the Corporation or the shareholders thereof or be entitled to
notification as to any meeting of the Board of Directors or the shareholders.
F. Protective Provisions. So long as shares of Series A
Preferred Stock are outstanding, the Corporation shall not without first
obtaining the approval (by vote or written consent, as provided by law) of the
holders of at least a majority of the then outstanding shares of Series A
Preferred Stock:
(i) alter or change the rights, preferences or
privileges of the shares of Series A Preferred Stock as to affect adversely the
Series A Preferred Stock;
(ii) create any new class or series of stock being
on a parity with or having a preference over the Series A Preferred Stock with
respect to dividends, to payments upon Liquidation (as provided for in Section B
of this Designation) or to redemption; or
(iii) do any act or thing not authorized or
contemplated by this Designation which would result in taxation of the holders
of shares of the Series A Preferred Stock under Section 305 of the Internal
Revenue Code of 1986, as amended (or any comparable provision of the Internal
Revenue Code as hereafter from time to time amended).
<PAGE>
G. Status of Converted Stock. In the event any shares of
Series A Preferred Stock shall be converted as contemplated by this Designation,
the shares so converted shall be canceled, shall return to the status of
authorized but unissued Preferred Stock of no designated class or series, and
shall not be issuable by the Corporation as Series A Preferred Stock.
FURTHER RESOLVED, that the statements contained in the foregoing
resolutions creating and designating the said Series A Preferred Stock and
fixing the number, powers, preferences and relative, optional, participating,
and other special rights and the qualifications, limitations, restrictions, and
other distinguishing characteristics thereof shall, upon the effective date of
said series, be deemed to be included in and be a part of the certificate of
incorporation of the Corporation pursuant to the provisions of the Nevada
Revised Statutes.
Signed on June 30 , 1998.
---------
Sworn to and subscribed before me By: /s/ Gary L. Coulter
---------------------
This 6 day of July , 1998. Its: President
------------- -----
/s/ Linda M. Dyer Attest:
Notary Public
By: /s/ Robert E. Hoyt
--------------------------
My Commission Expires: Its: Assistant Secretary
- -----------------------------------
(NOTARY SEAL)
EXHIBIT 4.1
-----------
Notices of Exercise
<PAGE>
NOTICE OF EXERCISE
(To be Executed by the Registered Holder
in order to Exercise the Conversion Privilege)
The undersigned hereby irrevocably elects to exercise the conversion privilege
under the Secured Convertible Note held by the undersigned to acquire shares of
common stock ("Common Stock") of SPINTEK GAMING TECHNOLOGIES, INC. (the
"Company") as of April 29, 1999. If shares are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto. No fee will be charged to the Holder for any
exercise, except for transfer taxes, if any. A copy of the Convertible Note is
attached hereto.*
The undersigned acknowledges that all offers and sales by the undersigned of the
shares of Common Stock issuable to the undersigned upon exercise of the
Convertible Note must be made pursuant to registration of the Common Stock under
the Securities Act of 1933, as amended (the "Act") or pursuant to an exemption
from registration under the Act.
Date of Exercise: April 26, 1997
Note Amount Converted: $250,000
Number of Shares of Common Stock
to be Issued: ________________________________________
Signature: /s/ L.L.E. Hollman/ E.R. van den Stoon
-----------------------------------------
Curacao Corporation Company N.V.
Managing Director
Name: NAC Investments Properties, Inc. N.V.
Address: c/o CITCO
P.O. Box 812
De Ruyterkade 62
Willemstad, Curacao
NETHERLANDS ANTILLES
* No Shares of Common Stock will be issued until the Warrant to be exercised and
the Notice of Exercise are received by the Company or its Transfer Agent.
<PAGE>
NOTICE OF EXERCISE
(To be Executed by the Registered Holder
in order to Exercise the Conversion Privilege)
The undersigned hereby irrevocably elects to exercise the conversion privilege
under the Secured Convertible Note held by the undersigned to acquire shares of
common stock ("Common Stock") of SPINTEK GAMING TECHNOLOGIES, INC. (the
"Company") as of April 29, 1999. If shares are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto. No fee will be charged to the Holder for any
exercise, except for transfer taxes, if any. A copy of the Convertible Note is
attached hereto.*
The undersigned acknowledges that all offers and sales by the undersigned of the
shares of Common Stock issuable to the undersigned upon exercise of the
Convertible Note must be made pursuant to registration of the Common Stock under
the Securities Act of 1933, as amended (the "Act") or pursuant to an exemption
from registration under the Act.
Date of Exercise: April 26, 1997
Note Amount Converted: $100,000
Number of Shares of Common Stock
to be Issued: _____________________________________
Signature: /s/ Patrick W. McGrath
----------------------------------------
Name: Patrick W. McGrath
Address: Suite 13
4770 Von Karman
Newport Beach, California 92663
* No Shares of Common Stock will be issued until the Warrant to be exercised and
the Notice of Exercise are received by the Company or its Transfer Agent.
<PAGE>
NOTICE OF EXERCISE
(To be Executed by the Registered Holder
in order to Exercise the Conversion Privilege)
The undersigned hereby irrevocably elects to exercise the conversion privilege
under the Secured Convertible Note held by the undersigned to acquire shares of
common stock ("Common Stock") of SPINTEK GAMING TECHNOLOGIES, INC. (the
"Company") as of April 29, 1999. If shares are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto. No fee will be charged to the Holder for any
exercise, except for transfer taxes, if any. A copy of the Convertible Note is
attached hereto.*
The undersigned acknowledges that all offers and sales by the undersigned of the
shares of Common Stock issuable to the undersigned upon exercise of the
Convertible Note must be made pursuant to registration of the Common Stock under
the Securities Act of 1933, as amended (the "Act") or pursuant to an exemption
from registration under the Act.
Date of Exercise: April 26, 1997
Note Amount Converted: $250,000
Number of Shares of Common Stock
to be Issued: ________________________________________
Signature: /s/ Patrick W. McGrath
---------------------------------
Signature: /s/ Donna McGrath
----------------------------
Name: Patrick W. McGrath & Donna McGrath
Address: 1321 Hampshire Circle
Newport Beach, California 92663
* No Shares of Common Stock will be issued until the Warrant to be exercised and
the Notice of Exercise are received by the Company or its Transfer Agent.
<PAGE>
NOTICE OF EXERCISE
(To be Executed by the Registered Holder
in order to Exercise the Conversion Privilege)
The undersigned hereby irrevocably elects to exercise the conversion privilege
under the Secured Convertible Note held by the undersigned to acquire shares of
common stock ("Common Stock") of SPINTEK GAMING TECHNOLOGIES, INC. (the
"Company") as of April 29, 1999. If shares are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto. No fee will be charged to the Holder for any
exercise, except for transfer taxes, if any. A copy of the Convertible Note is
attached hereto.*
The undersigned acknowledges that all offers and sales by the undersigned of the
shares of Common Stock issuable to the undersigned upon exercise of the
Convertible Note must be made pursuant to registration of the Common Stock under
the Securities Act of 1933, as amended (the "Act") or pursuant to an exemption
from registration under the Act.
Date of Exercise: April 26, 1997
Note Amount Converted: $4,000,000
Number of Shares of Common Stock
to be Issued:______________________________________
Signature: /s/ Malcolm C. Davenport V
-------------------------------------
Name: Malcolm C. Davenport V Family Trust
Address: 409 West 10th Street
P.O. Box 659
West Point, Georgia 31833
* No Shares of Common Stock will be issued until the Warrant to be exercised and
the Notice of Exercise are received by the Company or its Transfer Agent.
<PAGE>
NOTICE OF EXERCISE
(To be Executed by the Registered Holder
in order to Exercise the Conversion Privilege)
The undersigned hereby irrevocably elects to exercise the conversion privilege
under the Secured Convertible Note held by the undersigned to acquire shares of
common stock ("Common Stock") of SPINTEK GAMING TECHNOLOGIES, INC. (the
"Company") as of April 29, 1999. If shares are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto. No fee will be charged to the Holder for any
exercise, except for transfer taxes, if any. A copy of the Convertible Note is
attached hereto.*
The undersigned acknowledges that all offers and sales by the undersigned of the
shares of Common Stock issuable to the undersigned upon exercise of the
Convertible Note must be made pursuant to registration of the Common Stock under
the Securities Act of 1933, as amended (the "Act") or pursuant to an exemption
from registration under the Act.
Date of Exercise: April 26, 1999
Note Amount Converted: $100,000
Number of Shares of Common Stock
to be Issued: ________________________________________
Signature: /s/ Lloyd D. Levenson
------------------------------------------
Name: Lloyd D. Levenson
Address: 1125 Atlantic Avenue
Atlantic City, New Jersey 08401
* No Shares of Common Stock will be issued until the Warrant to be exercised and
the Notice of Exercise are received by the Company or its Transfer Agent.
EXHIBIT 4.2
Notices of Conversion
<PAGE>
RBB BANK AG
RBB Bank Aktiengesellschaft
Burgring 16, 8010 Graz
Tel. 011-43/316/8072-354
Fax 011-43/316/8072-392
From: Herbert Straub
To: Spintek Gaming Technology
Attn: Gary Coulter, Chairman & CEO 001-702-263-3680
Copies to: Jack Canouse 001-404-816-7837
Malcolm C. Davenport 001-706-643-4568
Date: 26/04/1999
Dear Sirs!
Please convert 5,384 of the 5.384 preferred shares held by RBB Bank as agent for
several independent clients into common shares of Spintek Gaming Technology.
The closing bid prices for the previous five days were:
19/4/1999 0.18000$
20/4/1999 0.16500$
21/4/1999 0.16500$
22/4/1999 0.17000$
23/4/1999 0.18750$
Average: 0.17350$ =Conversion Price
The issuance date of the pr. Shares was 1-Oct-96 and we should therefore get
interest for 937 days, which is 552,855.67$
RBB Banks clients should therefore get 34,218,188 common shares,
Please deliver the common shares to
Bank of New York, One Wall Street, 5th Floor
New York, NY 10286
Attn.: Free Receive Department
for RBB Bank, acc. no. 297 652
Yours sincerely,
/s/ Herbert Straub
- ---------------------------
<PAGE>
RBB BANK AG
RBB Bank Aktiengesellschaft
Burgring 16, 8010 Graz
Tel. 011-43/316/8072-354
Fax 011-43/316/8072-392
From: Herbert Straub
To: Spintek Gaming Technology
Attn: Gary Coulter, Chairman & CEO 001-702-263-3680
Copies to: Jack Canouse 001-404-816-7837
Malcolm C. Davenport 001-706-643-4568
Date: 26/04/1999
Dear Sirs!
Please convert 1,428 of the 1,428 preferred shares held by RBB Bank as agent for
several independent clients into common shares of Spintek Gaming Technology.
The closing bid prices for the previous five days were:
19/4/1999 0.18000$
20/4/1999 0.16500$
21/4/1999 0.16500$
22/4/1999 0.17000$
23/4/1999 0.18750$
Average: 0.17350$ =Conversion Price
The issuance date of the pr. Shares was 26-Oct-97 and we should therefore get
interest for 547 days, which is 85,601.75$
RBB Banks clients should therefore get 8,723,929 common shares,
Please deliver the commons shares to
Bank of New York, One Wall Street, 5th Floor
New York, NY 10286
Attn.: Free Receive Department
for RBB Bank, acc. no. 297 652
Yours sincerely,
/s/ Herbert Straub
- ---------------------------
<PAGE>
RBB BANK AG
RBB Bank Aktiengesellschaft
Burgring 16, 8010 Graz
Tel. 011-43/316/8072-354
Fax 011-43/316/8072-392
From: Herbert Straub
To: Spintek Gaming Technology
Attn: Gary Coulter, Chairman & CEO 001-702-263-3680
Copies to: Jack Canouse 001-404-816-7837
Malcolm C. Davenport 001-706-643-4568
Date: 26/04/1999
Dear Sirs!
Please convert 1,429 of the 1,429 preferred shares held by RBB Bank as agent for
several independent clients into common shares of Spintek Gaming Technology.
The closing bid prices for the previous five days were:
19/4/1999 0.18000$
20/4/1999 0.16500$
21/4/1999 0.16500$
22/4/1999 0.17000$
23/4/1999 0.18750$
Average: 0.17350$ =Conversion Price
The issuance date of the pr. Shares was 26-Apr-97 and we should therefore get
interest for 730 days, which is 114,320.00$
RBB Banks clients should therefore get 8,895,216 common shares,
Please deliver the common shares to
Bank of New York, One Wall Street, 5th Floor
New York, NY 10286
Attn.: Free Receive Department
for RBB Bank, acc. no. 297 652
Yours sincerely,
/s/ Herbert Straub
- ---------------------------
EXHIBIT 99.1
------------
Press Release
(dated May 3, 1999)
<PAGE>
Monday May 3, 3:02 am Eastern Time
- ----------------------------------
Company Press Release
Spintek Gaming Technologies Announces
Profitability and Conversion of
Debenture and Convertible Preferred Stock
LAS VEGAS--(BUSINESS WIRE)--May 3, 1999--Spintek (R) Gaming Technologies, Inc.
(OTC BB:SPTK - news) announced today that based on existing contracts, the
Company will report in excess of $5.0 million in sales for the fourth quarter
ending June 30, 1999.
This is exclusive of any new contracts or additional sales to current customers
during the quarter. During the first nine months of its fiscal year, sales
totaled $3.2 million. Spintek also announced that the outstanding convertible
preferred stock and the outstanding 6% secured convertible notes were converted
effective April 29, 1999 to common shares of the Company. The converting
investors have expressed that their conversion reflects their confidence in the
Company's management and their expectations of the Company's future growth and
profitability.
"Prior to the conversion, we had an equity situation that confused stockholders
and potential investors due to the convertibility features of the preferred
stock as well as the secured convertible debentures, and the unknown impact each
of these events would have on the number outstanding shares of common stock,"
said Gary L. Coulter, chairman and chief executive officer of Spintek. "With the
sales contracts that are currently in place, we believe that we will achieve
profitability in the fourth quarter of our current fiscal year.
"In addition," continued Coulter, "we anticipate that we will receive additional
significant contracts in the near future. With this in mind, to enhance
shareholder value we have been researching the listing criteria for various
stock exchanges. We are expecting to make such application during our next
fiscal year, and after the completion of a yet to be determined reverse split of
our common stock. Without the preferred shareholder having made the election to
convert at this time, we would have not been able to apply for listing until
after the automatic conversion date of December 31, 1999."
Spintek Gaming Technologies is a Nevada corporation based in Las Vegas, whose
focus is the development, acquisition and marketing of diversified technology,
including unique gaming industry products. Spintek offers a new standard of
operational coin control with AccuSystem, which brings a new level of gaming
device security and management information to the casino industry.
This news release contains forward-looking statements with respect to the
anticipated financial condition, results of operations and projections of SPTK
and its subsidiaries which involve risks and uncertainties, including, but not
limited to, competition from other gaming operations, unforeseen delays in
receiving product, licensing and other regulatory risks. Further, information on
potential factors which could affect the financial conditions and results of
operations of SPTK and its subsidiaries are included in the filings of SPTK with
the Securities and Exchange Commission, including but not limited to SPTK's Form
10-KSB for the fiscal year ended June 30, 1998.
