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Item 1.01 |
Entry into a Material Definitive Agreement. |
On November 8, 2022, Gaming Technologies, Inc.
(the “Company”) and the holder of the Company’s 10% Original Issue Discount Senior Secured Convertible Note in the principal
amount of $1,666,666.67, issued on November 18, 2021 (the “Secured Note”) amended the Secured Notes as follows: (a) the maturity
date of the Secured Notes is extended from November 18, 2021, to February 15, 2023; (b) the Company will issue to the holder of the Secured
Note additional Warrants with the same terms as the Warrants issued along with the Secured Note pursuant to the Securities Purchase Agreement
dated November 18, 2021 (with the term running from the date of amendment) in an amount such that the holder of the Secured Note obtains
an additional 10% warrant coverage per month based on the initial investment amount from November 1, 2022 to February 15, 2023 (thus,
the holder of the Secured Note will receive Warrants to purchase a total number of shares of the Company’s common stock equal to
210% of the original face amount of the Note, i.e., $1,666,666.67 converted at the lower of (i) $2.75 or (ii) the price of the common
stock in a Qualified Offering to purchase shares of common stock of the Company, exercisable at the exercise price set forth in the Warrants);
(c) the Company will take all corporate action necessary to expeditiously increase the Company’s authorized shares of common stock
to 400,000,000; and (d) the Company agrees that as soon as it has raised sufficient funds to make a payment on the outstanding balance
of the Note, it will promptly do so.
On November 10, 2022, the Company and two existing
investors amended the Securities Purchase Agreements, originally dated March 10, 2021, between the existing investors and
the Company (as so amended, the “2021 SPAs”) such that: (a) the purchase price per share was modified to equal $0.25 per share;
(b) the total number of shares to be issued is 1,201,500.
In addition, if, at any time until the earlier
of (i) November 10, 2024, (ii) the day after the date on which the Company’s common stock is listed on a U.S. national securities
exchange, or (iii) the date on which the original investor no longer holds any of the shares acquired by it under its 2021 SPA, the Company
issues or sells shares of common stock or common stock equivalents (with certain customary exceptions) for no consideration or for a consideration
per share (the “Dilutive Issuance Price”) less than $0.25 (subject to adjustment for reverse and forward stock splits, stock
dividends, stock combinations and other similar transactions, the “Per Share Purchase Price”) (a “Dilutive Issuance”),
then immediately upon the Dilutive Issuance, the Company will deliver to the investor that number of restricted shares of common stock
equal to the difference between the number of shares purchased by the investor pursuant to the 2021 SPA and the number of shares of Common
Stock the investor would have received for the investor’s subscription amount at the Dilutive Issuance Price.
Further, if on the 90th day after the date on
which the common stock is listed on a U.S. national securities exchange (the “Valuation Date”), the per share volume-weighted
average price of the common stock on the principal market for the common stock for the five 5 trading days ending on and including the
Valuation Date (the “Five-Day VWAP”) is less than the Per Share Purchase Price, or if a Dilutive Issuance and share adjustment
has occurred under the preceding sentence, less than the Dilutive Issuance Price, then the Company will deliver to the investor the number
of restricted shares of common stock equal to the difference between sum of the number of shares purchased by the investor pursuant to
the 2021 SPA plus any shares delivered to the investor pursuant to the preceding sentence and the number of shares of common stock the
investor would have received for the investor’s subscription amount at the Five-Day VWAP. The rights of each investor under the
two preceding sentences are subject to a customary 4.99% (which may be increased to 9.99% upon 61 days’ prior notice) beneficial
ownership “blocker” provision.
With certain specified exceptions and subject
to the next paragraph, until the earlier of (i) November 10, 2024, (ii) the day after the date on which the Company’s common stock
is listed on a U.S. national securities exchange, or (iii) the date on which the original investor no longer holds any of the shares acquired
by it under its 2021 SPA, the Company shall not consummate any unregistered private offering or an initial (but not any subsequent) public
offering for cash consideration of its capital stock (or securities convertible into shares of capital stock) (the “Other Securities”)
to any individual or entity (an “Other Investor”) that provides such Other Investor with any right, benefit, term or condition
relating to the Shares that is more favorable in any material respect to the Other Investor than the rights, benefits, terms and conditions
relating to the shares established in favor of the investor pursuant to the 2021 SPA and the related transaction documents, unless (i)
the Company notifies the investor of such more favorable right, benefit, term or condition within two business days prior to the issuance
of the Other Securities, and (ii) investor has been provided with the opportunity to execute an agreement or agreements between the Company
and the investor providing the investor such right, benefit, term or condition, solely with respect to the shares then held by the investor,
not later than the date of issuance of the Other Securities.
Until the earlier of (i) November 10, 2024, or
(ii) the date on which the original investor no longer holds any of the shares acquired by it under its 2021 SPA, if the Company completes
any single public offering or private placement of its equity, equity linked or debt securities (but excluding any bank debt or other
debt to another commercial lender) (each, a “Future Transaction”), the investor may, in its sole discretion, alternatively
and to the exclusion of any rights of the investor under the three preceding paragraphs, elect to apply all, or any portion, of the investor’s
subscription amount as purchase consideration for such Future Transaction (the “Rollover Rights”). The Company shall give
written notice to investor as soon as practicable, but in no event less than fifteen (15) days before the anticipated closing date of
such Future Transaction. In the event investor exercises its Rollover Rights, then such elected portion of the investor’s subscription
amount shall automatically convert into the corresponding securities issued in such Future Transaction under the terms of such Future
Transaction, such that the investor will receive all securities (including, without limitation, any warrants) issuable under the Future
Transaction, and immediately and automatically the Company shall cancel, and the investor shall automatically forfeit and surrender for
no consideration, all right, title and interest in and to a number of shares purchased by the investor under the 2021 SPA purchased by
such elected portion of the investor’s subscription amount.
The investors have customary “piggyback”
registration rights with respect to any registration statement filed by the Company under the Securities Act of 1933, as amended (the
“Securities Act”), with certain customary exceptions.
On November 18, 2022, the Company entered into
Securities Purchase Agreements with two accredited investors whereby by the Company sold to such investors 480,600 shares of its common
stock at a purchase price of $0.25 per share, for gross proceeds of $120,150. These Securities
Purchase Agreements contain substantially the same provisions in favor of the investor as those described above in the amended 2021 SPAs.
The Company entered into a finder’s fee
agreement with a broker which calls for the Company to pay a commission of nine percent (9%) on these funds.
The foregoing descriptions
of the referenced agreements is a summary and is qualified by reference to the full agreements, which are filed as Exhibits 10.1 through
10.3 to this Report and are incorporated herein by reference.
