Item 1.01 Entry into a
Material Definitive Agreement
As
previously reported, Gaming Technologies, Inc. (the “Company”) entered into a securities purchase agreement
dated November 20, 2020 (the “2020 Purchase Agreement”) and a securities purchase agreement dated as of February 3,
3021 (the “2021 Purchase Agreement” and together with the 2020 Purchase Agreement, the “Purchase Agreements”)
with an accredited investor for the sale of the Company’s common stock at a price of $2.50 per share. On April 26, 2022, the Company
and the investor entered into an amendment to the Purchase Agreements (the “Amendment”), and the Company and the Investor
entered into a loan agreement (the “Loan Agreement”) and the Company issued to the investor a subordinated promissory
note in the principal amount of $66,667 (the “Subordinated Note”) and received gross proceeds of $65,000 after deduction
of a 10% origination fee to the investor.
Pursuant
to the Amendment, the provisions in the Purchase Agreements for an adjustment due to price based dilution, which had expired by their
terms, were extended, such that if, at any time until the earlier of (a) May 15, 2022, or (b) the day after the date on which the Company
completes an underwritten public offing of shares of its common stock, except for certain exempt issuances as described in the Purchase
Agreements, at a price below $2.50 per share (as adjusted for stock splits), then 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 such Purchase
Agreement and the number of shares of common stock the investor would have received for the investor’s original subscription amount
(an aggregate of $4,500,000) at the dilutive issuance price.
The
Subordinated Note. The Subordinated Note is unsecured, bears interest at a rate of 10% per year (the “Interest Rate”),
and matures on the earlier of the earlier of (a) October 26, 2022 or (b) a Capital Event (the “Final Maturity Date”).
“Capital Event” means (a) any transaction in which the Company, or any subsidiary of the Company, or any joint venture
directly or indirectly owned by the Company: (i) refinances or incurs any indebtedness exceeding $100,000 in the aggregate of all such
transactions, (ii) sells, transfers or otherwise disposes (including pursuant to a sale-leaseback transaction) of any property or asset
(including securities) other than in the ordinary course of business, (iii) forms a joint venture, or (iv) issues private or public equity,
stock or other financial instrument for cash consideration exceeding $100,000 in the aggregate of all such transactions; (b) any casualty
or other insured damage exceeding $100,000 to, or any taking under power of eminent domain or by condemnation or similar proceeding of,
any property or asset of the Company, or any subsidiary of the Company, or any joint venture directly or indirectly owned by the Company;
or (c) any other transaction entered into for the purposes of generating cash to recapitalize the Company’s balance sheet.
If
a Change of Control (as defined in the Subordinated Note) of Company occurs, then on or prior to the fifth business day following the
date of such Change of Control, the Company shall prepay the Subordinated Note and all other obligations (other than, indemnity obligations
under the loan documents that are not then due and payable or for which any events or claims that would give rise thereto are not then
pending) in full in cash together with (i) accrued interest thereon to the date of such prepayment, (ii) all other amounts owing to Investor
under the loan documents, (iii) an amount equal to the difference between (x) the aggregate amount of interest that would have been due
to Investor, for the period from and after the date of issuance of the Subordinated Note to and including the Final Maturity Date based
upon the principal amount outstanding immediately prior to and the interest rate in effect as of the date of such prepayment, less (y)
the amount of interest actually paid to Investor prior to the date of such prepayment.
Upon
an Event of Default (as defined therein) interest shall accrue at the rate of 18% per annum.
Under
the Loan Agreement, the Company may borrow up to an additional $211,111 from the Investor on the same terms as described above, subject
to certain conditions.
Intercreditor
Agreement. In connection with issuing the Subordinated Note, the Company, the Subordinated Note holder and the holder of the Company’s
$1,666,666.67 10% Original Discount Senior Secured Convertible Note issued in November 2021 (the “Senior Note”) entered
into a Intercreditor Agreement (the “Intercreditor Agreement”), pursuant to which the Subordinated Note holder agreed
to fully subordinate its rights under the Subordinated Note to the Senior Note and related agreements, as described more fully in the
Intercreditor Agreement.
The descriptions
above of the Amendment, the Loan Agreement, the Subordinated Note and Intercreditor Agreement do not purport to be complete and are qualified
in their entirety by reference to the complete texts of the Amendment, the Junior Note and the Intercreditor Agreement, each of which
is filed as Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3, respectively, to this current report on Form 8-K.
