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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)*
CASINOVATIONS INCORPORATED
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock $.001 par value
- --------------------------------------------------------------------------------
(Title of Class of Securities)
14761P 10 4
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(CUSIP Number)
Stacie L. Brown, 6830 Spencer Street, Las Vegas, Nevada 89119;
Tel.: (702) 733-7195
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
March 22, 2000
- --------------------------------------------------------------------------------
(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-l(b)(3) or (4), check the following box [ ]
Check the following box if a fee is being paid with the statement [ ]. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item l; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
NOTE: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-l(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP No. 14761P 10 4 13D Page 2 of 15 Pages
________________________________________________________________________________
1. Name of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only).
Bob L. Smith
________________________________________________________________________________
2. Check the Appropriate Box If a Member of a Group (See Instructions)
(a) [_]
(b) [_]
________________________________________________________________________________
3. SEC Use Only
________________________________________________________________________________
4. Source of Funds (See Instructions)
VIP's Industries, Inc. funds.
________________________________________________________________________________
5. Check If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
Not applicable.
________________________________________________________________________________
6. Citizenship or Place of Organization
United States
________________________________________________________________________________
7. Sole Voting Power
NUMBER OF 420,395 shares
SHARES _________________________________________________________________
BENEFICIALLY 8. Shared Voting Power
OWNED BY 292,620 shares
EACH _________________________________________________________________
REPORTING 9. Sole Dispositive Power
PERSON 420,395 shares
WITH _________________________________________________________________
10. Shared Dispositive Power
292,620 shares
________________________________________________________________________________
11. Aggregate Amount Beneficially Owned by Each Reporting Person
713,015
________________________________________________________________________________
12. Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) [_]
________________________________________________________________________________
13. Percent of Class Represented by Amount in Row (11)
6.63%
________________________________________________________________________________
14. Type of Reporting Person (See Instructions)
IN
________________________________________________________________________________
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
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This Amendment No. 2 amends the Schedule 13D dated April 23, 1999 (the
"Schedule 13D") and the Amendment No. 1 dated September 22, 1999, (the "First
Amendment") of Bob L. Smith with respect to the common stock, $.001 par value
("Common Stock") of Casinovations Incorporated, a Nevada corporation (the
"Issuer"). Except as specifically provided herein, this Amendment No. 2 does not
modify any of the information previously reported on the Schedule 13D or the
First Amendment.
ITEM 3. SOURCE OF FUNDS OR OTHER CONSIDERATIONS
VIP's Industries, Inc. funds.
ITEM 4. PURPOSE OF TRANSACTION
The filing of this Amendment No. 2 to Schedule 13D is a result of a
loan to Issuer in the amount of $200,000 (the "Loan") by VIP's Industries, Inc.,
("VIP's") an entity controlled by Mr. Smith. In connection with the Loan, VIP's
executed, and Issuer accepted, the Subscription Agreement dated March 22, 2000.
The Issuer also executed a 10% Convertible Note due June 1, 2000, (the "Note")
in favor of VIP's, which may elect to convert the Note into 72,727 shares of
Common Stock at a conversion price of $2.75 per share.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
BOB L. SMITH PRESENTLY OWNED PERCENTAGE(4)
------------ --------------- -------------
Sole Voting Power 420,395(1,2) 3.9%
Shared Voting Power 292,620(3) 2.7%
Sole Dispositive Power 420,395(1,2) 3.9%
Shared Dispositive Power 292,620(3) 2.7%
Total Beneficial Power 713,015 6.63%
- -----------------
(1) This amount represents 344,195 shares of Common Stock issued directly to Mr.
Smith, 18,200 shares of Common Stock issuable to Mr. Smith upon the exercise of
certain warrants, 55,000 shares of Common Stock issuable to Mr. Smith upon the
exercise of certain stock options, and 3,000 shares of Common Stock issuable to
Mr. Smith upon the exercise of certain stock options.
(2) Shares of Common Stock may be subject to applicable community property laws.
(3) This amount represents 176,236 shares of Common Stock held by VIP's
Industries, Inc., an entity controlled by Mr. Smith, 1,000 shares of Common
Stock issued jointly to Mr. Smith and his daughter, 33,557 shares of Common
Stock issuable to VIP's Industries, Inc. upon the exercise of Class A Warrants,
9,100 shares of Common Stock issuable to VIP's Industries, Inc. upon the
exercise of certain warrants, and 72,727 shares of Common Stock issuable to
VIP's Industries, Inc. upon the conversion of that certain 10% Convertible Note
Due June 1, 2000.
(4) These percentages reflect the percentage share ownership with respect to
10,746,144 shares, the number of shares of Common Stock outstanding as of March
31, 2000.
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ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
The Subscription Agreement dated March 22, 2000, by and between VIP's
and the Issuer is attached hereto as Exhibit "A". The Note, as executed by the
Issuer, is attached hereto as Exhibit "B".
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: April 6, 2000
/s/ Stacie L. Brown
----------------------------------
Stacie L. Brown, Attorney-In-Fact
for Bob L. Smith
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EXHIBIT A
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SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT (this "Agreement") is made and entered into
as of the 22nd day of March 2000, by and between Casinovations Incorporated, a
Nevada corporation (the "Company") and VIP'S Industries ("Purchaser") and is
delivered and executed in connection with that certain 10% Convertible Note due
June 1, 2000.
1. OFFER
(a) Purchaser, by signing this Agreement, hereby offers to
loan to the Company the amount of $200,000 (the "Investment Amount").
(b) The Company shall have the right, at its sole and absolute
discretion, to reject this subscription offer, or to accept such offer. If the
Company accepts Purchaser's offer, the Company shall execute this Agreement and
return a copy of the Agreement, along with the Note to Purchaser. If the Company
rejects Purchaser's offer, the Company shall return to Purchaser this Agreement,
together with any payment made by Purchaser to the Company, without interest or
deduction.
2. RECEIPT OF DOCUMENTS
Purchaser hereby acknowledges receipt of a copy of: (1) this
Agreement; (2) the Note; (3) the Company's Registration Statement on Form
SB-2/A dated October 16, 1998; (4) the Company's Quarterly Report on Form
10-QSB for the quarter ended September 30, 1999; and (5) the Company's Current
Report on Form 8-K filed March 16, 2000 (collectively, the "Documents"). Upon
filing its Annual Report on Form 10-KSB with the Securities and Exchange
Commission, the Company will forward a copy of the same to Purchaser as soon
as practicable.
3. USE OF PROCEEDS; NO REFUNDS
The Investment Amount shall be used to for general working
capital purposes. Upon execution and delivery of this Agreement, the
Investment Amount shall not, under any circumstances, be refunded to
Purchaser.
4. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to the Company as follows:
(a) Purchaser, either alone or through Purchaser's purchaser
representative (as that term is defined under Rule 501(h) of Regulation D under
the Securities Act of 1933, as amended (the "Securities Act") ("Purchaser's
Representative," herein)), if any, has had an opportunity to ask questions of
and receive answers from duly designated representatives of the Company
concerning the terms and conditions of this Agreement and has been afforded an
opportunity to examine such documents and other information which Purchaser or
Purchaser's Representative, if any, has requested for the purpose of answering
any question Purchaser or Purchaser's Representative, if any, may have
concerning the business and affairs of the Company.
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(b) Purchaser's principal place of business is located in the
State of Oregon. Purchaser has received and reviewed this Agreement and the
Documents and acknowledges the Company made available to Purchaser at a
reasonable time prior to the execution of this Agreement the opportunity to ask
questions and receive answers concerning the business and affairs of the Company
and to obtain any additional information (which the Company possesses or can
acquire without unreasonable effort or expense) as may be necessary to verify
the accuracy of information furnished to Purchaser. Purchaser (i) is able to
bear the loss of its entire investment without any material adverse effect on
its economic stability, and (ii) has such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and risks of
the investment to be made by i pursuant to this Agreement.
(c) Purchaser and Purchaser's Representative, if any,
understand that the Company is only entering into this Agreement with
"accredited investors" (as that term is defined under Rule 501(a) of Regulation
D), and PURCHASER REPRESENTS THAT PURCHASER IS AN ACCREDITED INVESTOR. Purchaser
understands the Company is relying on Purchaser with respect to the accuracy of
this representation.
(d) Purchaser and Purchaser's representative, if any,
understand that this Agreement may not comply with the information requirements
of Regulation D for offers and sales to non-accredited investors (see Regulation
D, Rule 502(b)), and, consequently, Purchaser understands the significance of
its representation to the Company that it is an accredited investor. Purchaser
and Purchaser's representative, if any, acknowledge that they were encouraged by
the Company to request all additional information which might be material or
important in order for Purchaser to make an informed investment decision with
respect to the Company.
(e) The Investment Amount is for investment purposes only for
Purchaser's own account and not with the view to, or for resale in connection
with, any distribution or public offering thereof. Purchaser understands that
the securities into which the Note may be converted have not been registered
under the Securities Act or any state securities laws by reason of their
contemplated issuance in transactions exempt from the registration requirements
of the Securities Act and applicable state securities laws, and that the
reliance of the Company and others upon these exemptions is predicated in part
upon the representation by Purchaser. Purchaser understands that the Note may
not be transferred or resold without the prior approval of the Company.
(f) Purchaser has taken the time to carefully read this
Agreement, the Documents and any other information furnished to Purchaser by the
Company in connection with this Agreement.
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(g) Purchaser was not solicited to purchase the Unit or the
Note by any means of general solicitation, including but not limited to the
following: (i) any advertisement, article, notice or other communication
published in any newspaper, magazine, or similar media, or broadcast over
television or radio; or (ii) any meeting where attendees were invited by any
general solicitation or general advertising.
(h) Purchaser and Purchaser's Representative, if any, are
aware that the shares issuable upon conversion of the Note are and will be, when
issued, "restricted securities", as that term is defined in Rule 144 (the
"Rule") of the rules and regulations promulgated under the Securities Act.
Purchaser and Purchasees Representative, if any, are fully aware of the
applicable limitations on the resale of the resulting shares. The Rule only
permits sales of "restricted securities" held for not less than one year upon
compliance with the requirements of such Rule. If the Rule is available to
Purchaser - and representatives of the Company hereby advise Purchaser that such
availability is HIGHLY UNLIKELY - Purchaser may make only routine sales of the
resulting shares in limited amounts in accordance with the terms and conditions
of the Rule. Purchaser is fully aware that in any event, there is not likely to
be any market for the resulting shares and that finding a purchaser for the
resulting shares could be extremely difficult.
(i) Purchaser and Purchaser's Representative, if any,
understand that any and all certificates representing the resulting shares shall
bear a legend substantially as follows, which legend Purchaser has read and
understands:
The Shares represented by this Certificate have not been
registered under the Securities Act of 1933 (the "Act") or
the securities laws of any state and are "restricted
securities" as that term is defined in Rule 144 under the
Act. Such Shares may not be offered for sale, sold or
otherwise transferred except pursuant to an effective
registration statement under the Act and the applicable state
securities laws or pursuant to an exemption from registration
thereunder, the availability of which is to be established to
the satisfaction of counsel to the issuer.
(j) Purchaser acknowledges that in making its investment
decision, Purchaser has relied upon its examination of the Company and its
officers, directors and employees regarding the merits and risks involved.
Purchaser has consulted its own attorney, business or tax advisor as to legal,
business or tax advice.
(k) Purchaser represents and warrants that Purchaser can bear
the economic risk of loss of Purchaser's entire investment in the Company.
Purchaser understands that an investment in the Company involves substantial
risks, including, without limitation, the risk factors described in the
Documents and the following:
(i) NEED FOR ADDITIONAL FINANCING. The Company, at
this time, has limited capital resources. To continue
operations, the Company may require additional
financing for working capital and general business 3
purposes. No assurance can be given that the Company
will obtain any additional outside financing on terms
that are favorable to the Company or in amounts
necessary to fund its cash requirements.
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(ii) DILUTION. If the Company obtains additional
funds through private or public equity or debt
financings, and if Purchaser acquires common stock
through conversion of the Note, Purchaser may
experience substantial dilution as a consequence of
such future financings, including, without
limitation, a reduction in its respective percentage
ownership in the Company.
(iii) COMPETITION. The gaming and gaming related
products industry is characterized by intense
competition. Many of the Company's competitors have
far greater experience and financial resources than
the Company. No assurance can be given that the
Company will be able to compete effectively against
its competitors.
(iv) DEPENDENCE ON KEY PERSONNEL. The Company's
success depends to a significant extent on the
performance of certain key personnel. The loss of
such key personnel could materially and adversely
affect the Company. The Company has not executed
employment agreements with all such key personnel.
(v) LIMITATIONS ON TRANSFERABILITY. Transferability
of the Note will be restricted by the prior express
written approval of the Company. Purchaser will be
required to bear the economic risk of its investment
in the Company for an indefinite period of time.
(vi) ABSENCE OF MARKET FOR THE SHARES. The shares of
common stock, which may be acquired through the
conversion of the Note are being offered exclusively
to accredited investors for investment purposes only.
There will be no public market for the Note or the
shares which may be acquired through its conversion.
Although the Company intends to cause its common
stock to begin trading, there is no assurance that
this will occur. Accordingly, the Note is not a
liquid investment and is ONLY SUITABLE FOR INVESTORS
WHO HAVE SUBSTANTIAL FINANCIAL RESOURCES, HAVE NO
NEED FOR LIQUIDITY IN THEIR INVESTMENT IN THE COMPANY
AND WHO ARE PREPARED TO LOSE THEIR INVESTMENT IN THE
COMPANY IN ITS ENTIRETY.
(vii) TAX RISKS. An investment evidenced by this
Agreement and the Note may involve material and
substantial tax consequences to Purchaser. Purchaser
is urged to consult with tax counsel and/or a tax
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accountant of Purchaser's own choice concerning the
tax consequences particular to Purchaser, which may
arise from subscribing to, holding and/or disposing
of the Note.
5. INDEMNEFICATION BY PURCHASER
Purchaser agrees that it shall indemnify and hold harmless the
Company and its officers, directors, employees, agents and professional advisors
from and against any and all loss, damage, liability, or expense, including
costs and reasonable attorneys' fees, that the foregoing, or any of them, may
incur by reason of, or in connection with, any misrepresentation, inaccurate
statement or material omission made by Purchaser herein, any breach of any of
Purchaser's warranties, or any failure on Purchaser's part to fulfill any of
Purchaser's covenants, agreements or obligations set forth herein.
6. AUTHORIZATION
Purchaser hereby authorizes the Company and its officers,
employees and agents to investigate Purchaser's background including, without
limitation, communication with any business associate, government agency, bank
or other credit reference. Purchaser hereby authorizes any person, organization
or entity that may have any knowledge or information relating to Purchaser's
background to provide such information to the Company as the Company may
request.
7. NO BROKERS OR FINDERS
No person, firm or corporation has or will have, as a result
of any act or omission by Purchaser, any right, interest or valid claim
against Purchaser or the Company for any commission, fee or other compensation
as a finder or broker, or in any similar capacity, in connection with the
transactions contemplated by this Agreement.
8. MISCELLANEOUS
(a) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Nevada.
(b) This Agreement and the Note contain the entire agreement
between the Company and Purchaser with regard to the subject matter hereof and
may not be modified or waived except in a writing signed by both the Company and
Purchaser.
(c) The headings of this Agreement are for convenience and
reference only, and shall not limit or otherwise affect the interpretation of
any term or provision hereof.
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(d) This Agreement and the rights, powers, and duties set
forth herein shall, except as otherwise expressly provided herein, be binding
upon and inure to the benefit of, the heirs, executors, administrators, legal
representatives, successors, and assigns of the parties hereto.
(e) Purchaser may not assign any of Purchaser's rights or
interests in and under this Agreement without the prior written consent of the
Company, and any attempted assignment without such consent shall be null and
void and without any force or effect whatsoever.
(f) If any legal action or any arbitration or other proceeding
is brought for the enforcement of this Agreement, or because of an alleged
dispute, breach, default, or misrepresentation in connection with any of the
provisions of this Agreement, the successful or prevailing party or parties
shall be entitled to recover reasonable attorneys' fees and other costs incurred
in that action or proceeding, in addition to any other relief to which it may be
entitled.
(g) This Agreement shall be construed in accordance with its
intent and without regard to any presumption or any other rule requiring
construction against the party causing the same to be drafted.
(h) If any provision of this Agreement, or any portion of any
provision, shall be deemed invalid or unenforceable for any reason whatsoever,
such invalidity or unenforceability shall not affect the enforceability and
validity of the remaining provisions hereof.
IN WITNESS WHEREOF, the undersigned has executed this
Agreement as of the date first set forth above.
"PURCHASER"
VIP'S Industries
By: /s/ Bob L. Smith
-------------------------------------
Bob L. Smith, Chairman of the Board
and Chief Executive Office
Address: 280 Liberty St. SE, Ste. 300
Salem, OR 97301
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ACCEPTANCE OF SUBSCRIPTION AGREEMENT
On this 22nd day of March 2000, Casinovations Incorporated, a Nevada
corporation, hereby accepts offer of VIP'S Industries to loan to the Company
the sum of $200,000.
CASINOVATIONS INCOROPRATED
By: /s/ Stacie L. Brown, Attorney-In-Fact for
---------------------------------------------
Steven J. Blad, President and Chief Executive Officer
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EXHIBIT B
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THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR REGISTERED OR
QUALIFIED UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY STATE, AND THIS
NOTE MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION OR QUALIFICATION; PROVIDED, HOWEVER, THAT THIS
NOTE MAY BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED PURSUANT TO AN
EXEMPTION FROM REGISTRATION OR QUALIFICATION.
CASINOVATIONS INCORPORATED
10% CONVERTIBLE NOTE DUE JUNE 1, 2000
$200,000.00 March 22, 2000
FOR VALUE RECEIVED, the undersigned Casinovations Incorporated, a
Nevada corporation ("Obligor"), hereby promises to pay to the order of
VIP'S Industries or its registered assigns ("Holder") on June 1, 2000, the
principal sum of Two Hundred Thousand and 00/100 Dollars ($200,000.00) and
to pay interest on the unpaid principal balance hereof from the date hereof
at a rate of 10% per annum, payable on June 1, 2000. This Note is
unsecured. At its discretion, Obligor may, at any time, redeem the Note
without penalty upon payment of' the face value of the Note and any unpaid
and accrued interest.
On May 1, 2000, Holder is entitled, at its option, to convert this
Note into fully paid and non-assessable shares of restricted $.001 par
value common stock of the Obligor ("Common Stock") at the conversion price
of $2.75 per share (the "Conversion Price"), subject to such adjustment or
adjustments, if any, of such Conversion Price and the Common Stock issuable
upon conversion, upon surrender of this Note, duly endorsed or assigned to
Obligor or in blank, to Obligor, with the conversion notice attached
hereto, or accompanied by a separate written notice substantially in the
form of such conversion notice, duly executed by Holder and stating that
Holder elects to convert this Note, or if less than the entire principal
amount hereof is to be converted (but in not less than $25,000 increments),
the portion hereof to be converted, all in accordance with the provisions
of the Subscription Agreement. No fractional shares will be issued on
conversion, but instead of any fractional interest, Obligor shall pay a
cash adjustment. If Obligor shall, prior to the conversion or payment of
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the Note in full, (a) declare a dividend or make a distribution of its
Common Stock payable in shares of its Common Stock, (b) subdivide its
outstanding shares of Common Stock into a greater number of shares of
Common Stock, or (c) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock, or (d) issue any shares of
capital stock of the Company by reclassification or capital reorganization
of its shares of Common Stock, then the conversion privilege and the
Conversion Price in effect immediately prior to such action shall be
adjusted so that the Holder of a Note thereafter converted shall be
entitled to receive the number and kind of shares of Common Stock or other
Capital Stock which the Holder would have owned or have been entitled to
receive immediately after such action had the Holder converted the Note
immediately prior to the record date in the case of (a), or the effective
date in the case of (b), (c) or (d).
Obligor shall prepare and, no sooner than nine months and no later
than twelve months after the date hereof, file with United States
Securities and Exchange Commission (the "SEC"), an appropriate registration
statement to effect a registration of the Registrable Securities (as
defined below) covering the resale of the Registrable Securities issuable
to Holder upon conversion of this Note, which registration statement, to
the extent allowable under the Securities Act of 1933, as amended, and the
rules promulgated thereunder (including Rule 416), shall state that such
registration statement also covers such indeterminate numbers of additional
shares of Common Stock as may become issuable upon conversion of the Note
to prevent dilution resulting from stock splits, stock dividends or similar
transactions. The Company shall use its best efforts to obtain
effectiveness of the registration statement as soon as practicable. For
purposes of this Agreement, the term "Registrable Securities" means the
shares of Common Stock issued or issuable upon conversion of the Note and
any shares of capital stock issued or issuable as a dividend on or in
exchange for or otherwise with respect to any of the foregoing. All
reasonable expenses, other than underwriting discounts and commissions,
incurred by Obligor in connection with registrations, filings or
qualifications pursuant to this paragraph, including without limitation,
all registration, listing and qualification fees, printers and accounting
fees, and the fees and disbursements of counsel for Obligor, shall be borne
by Obligor.
Obligor may issue other indebtedness from time to time prior to or
hereafter that has a senior ranking to this Note in priority of payment,
and this Note will be subordinate in right of payment thereto. In the event
any action is taken to collect or enforce the indebtedness evidenced by
this Note (the "Indebtedness") or any part thereof, Obligor agrees to pay,
in addition to the principal and interest due and payable hereon, all costs
of collecting this Note, including reasonable attorneys' fees and expenses.
These costs shall include any expenses incurred by Holder in any
bankruptcy, reorganization, or other insolvency proceeding.
No delay or omission of Holder in exercising any right or rights,
shall operate as a waiver of such right or any other rights. A waiver on
one occasion shall not be construed as a bar to or waiver of any right or
remedy on any future occasion.
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The liability of Obligor under this Note (and the liability of any
endorsers of this Note) shall not be discharged, diminished or in any way
impaired by (a) any waiver by Holder or failure to enforce or exercise
rights under any of the terms, covenants or conditions of this Note, (b)
the granting of any renewal, indulgence, extension of time to Obligor, or
any other obligors of the Indebtedness, or (c) the addition or release of
any person or entity primarily or secondarily liable for the Indebtedness.
In no event shall the interest rate charged or received hereunder
at any time exceed the maximum interest rate permitted under applicable
law. Payments of interest received by Holder hereunder which would
otherwise cause the interest rate hereunder to exceed such maximum interest
rate shall, to the extent of such excess, be deemed to be (and be deemed to
have been contracted as being) prepayments of principal and applied as
such.
This Note shall be binding upon the undersigned and its successors
and assigns and shall inure to the benefit of Holder, its successors and
assigns. Every person and entity at any time liable for the payment of this
Note hereby waives demand, presentment, protest, notice of protest, notice
of nonpayment due and all other requirements otherwise necessary to hold
them immediately liable for payment hereunder.
This Note is governed by and shall be construed and enforced in
accordance with the laws of the State of Nevada.
Time is of the essence with respect to all of the terms and
provisions of this Note.
CASINOVATIONS INCORPORATED
By: /s/Stacie L. Brown, Attorney-In-Fact For
-----------------------------------------------------
Steven J. Blad, President and Chief Executive Officer
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NOTICE OF CONVERSION
To Casinovations Incorporated:
The undersigned Holder of this 10% Convertible Note due June 1,
2000 (this "Note") hereby irrevocably exercises the option to convert
$________principal amount of this Note, into shares of restricted $.001 par
value common stock of Casinovations Incorporated ("Common Stock"), in
accordance with the terms and conditions of this Note, and directs that the
shares of restricted Common Stock issuable and deliverable upon conversion
be issued and delivered to the undersigned unless a different name has been
indicated below. If shares of Common Stock are to be registered in the name
of a person or entity other than the undersigned, the undersigned will pay
any transfer taxes payable with respect thereto.
In the event that the shares of Common Stock are registered
pursuant an effective registration statement under the Securities Act of
1933, as amended, the undersigned shall be issued shares of registered
Common Stock, rather than shares of restricted Common Stock.
Dated: _______________________________
ATTEST:_______________________________
Signed:_______________________________
By:___________________________________
Its:__________________________________
Address: _____________________________
City:_________________________________
State:_____________ Zip:_____________
Tax Identification No.: ______________
Complete the items below for registration of shares of Common Stock
only if otherwise than in name and address of VIP'S Industries
------------------------------------- -----------------------------------
(Name) (Address)
------------------------------------- -----------------------------------
(City, State, and Zip Code) (Tax Identification Number)
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