UNITED STATES
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
Date of Report: December 2, 2003
(Date of earliest event reported) (November 24, 2003)
Multimedia Games, Inc.
(Exact name of registrant as specified in its charter)
0-28318
(Commission File Number)
Texas 74-2611034
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
206 Wild Basin Rd., Bldg. B, Suite 400, 78746
Austin, Texas (Zip Code)
(Address of principal executive offices)
(512) 334-7500
(Registrant's telephone number, including area code)
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Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description
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99.1 Press Release, dated November 24, 2003, announcing fiscal year
2003 results
99.2 Transcript of fiscal year 2003 results conference call
Item 9. Regulation FD Disclosure
On November 21, 2003, the United States Department of Justice ("DOJ") filed
a Petition for a Writ of Certiorari in the United States Supreme Court seeking
review of two U.S. Circuit Court cases that examined whether the Johnson Act
prohibits Native American tribes from offering certain types of electronic
gaming devices. Specifically, the DOJ seeks review of United States of America
v. Santee Sioux Tribe of Nebraska, a federally recognized Indian Tribe, on
Petition for a Writ of Certiorari to the United States Court of Appeals for the
Tenth Circuit, and John D. Ashcroft, Attorney General, et al., v. Seneca-Cayuga
Tribe of Oklahoma, et al. on Petition for a Writ of Certiorari to the United
States Court of Appeals for the Eighth Circuit. In the petitions, the DOJ
asserts that the Johnson Act prohibits Native American tribes from operating
certain electronic gambling devices without a compact with the appropriate
state. Although the machines offered by Multimedia Games, Inc. (the
"Registrant") are not the subject of either lawsuit, the DOJ's arguments and
reasoning would appear to encompass the machines offered by the Registrant for
the Class II market. As a result, if the U.S. Supreme Court were to grant
certiorari and adopt the arguments advanced by the DOJ, the play of most of the
Registrant's current products without a compact would likely be prohibited by
the Johnson Act. This result would almost certainly have a significant, material
adverse impact on the Registrant's business and operating results.
Alternatively, a decision by the Supreme Court that rejected the DOJ's arguments
and instead affirmed the right of the tribes to offer games such as those
manufactured and sold by the Registrant as legal "electronic aids" to bingo for
the Class II market could remove significant legal uncertainty in the
Registrant's principal market. A favorable result could form the basis for
expansion of market opportunities, and further innovation in the Class II
market.
As discussed in the transcript attached to this report as Exhibit 99.2, we are
not a party to these actions. We will likely have only limited information about
the proceedings at the Supreme Court. We cannot predict whether the Supreme
Court will grant certiorari in these cases or, if certiorari is granted, how the
Supreme Court will rule. Accordingly, we do not intend to speculate about the
potential outcomes in these matters.
The proceedings at the Supreme Court may affect our business prior to their
resolution. In particular, it is possible that the continued uncertainty in the
Class II gaming market may deter or delay the entrance of new competitors into
our markets. Also, our tribal customers may face increased pressure to seek a
compact with the states in which they operate. However, it is difficult to
predict whether these or other effects will actually occur or, should they
occur, what impact they will have on our business. We intend to continue to
disclose any material effects we experience as a result of the actions of the
DOJ or other regulatory developments.
Item 12. Results of Operation and Financial Condition.
On November 24, 2003, the Registrant issued a press release announcing its
fiscal year 2003 results, and on the same date held a conference call to discuss
these results. The full text of the press release issued in connection with the
announcement, and the related conference call transcript are attached as Exhibit
Nos. 99.1 and 99.2, respectively, to this Current Report on Form 8-K.
The information in this Current Report on Form 8-K, and the Exhibits attached
hereto shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to
the liabilities of that section, nor shall it be deemed incorporated by
reference in any filing under the Securities Act of 1933, as amended, or the
Exchange Act, except as expressly set forth by specific reference in such a
filing.
Use of Non-GAAP Financial Information
The Registrant uses the non-GAAP measure of EBITDA in its earnings releases.
EBITDA is defined as earnings before interest, taxes, depreciation and
amortization. Although EBITDA is not a measure of performance or liquidity
calculated in accordance with generally accepted accounting principles ("GAAP"),
the Registrant believes the use of the non-GAAP financial measure EBITDA
enhances an overall understanding of the Registrant's past financial performance
as well as providing useful information to the investor, because of its
historical use by the Registrant as both a performance measure and measure of
liquidity, and the use of EBITDA by virtually all companies in the gaming
equipment sector as a measure of both performance and liquidity. However,
investors should not consider
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this measure in isolation or as a substitute for net income, operating income,
cash flows from operating activities or any other measure for determining the
Registrant's operating performance or liquidity that is calculated in accordance
with GAAP. In addition, because EBITDA is not calculated in accordance with
GAAP, it may not necessarily be comparable to similarly titled measures employed
by other companies. The Registrant has included a reconciliation of EBITDA to
the most comparable GAAP financial measure, net income, in the attached press
release.
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SIGNATURES
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.
MULTIMEDIA GAMES, INC.
Dated: December 2, 2003 By: /s/ Craig S. Nouis
----------------------------
Craig S. Nouis
Chief Financial Officer and
Principal Accounting Officer
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EXHIBIT INDEX
Exhibit No. Description
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99.1 Press Release, dated November 24, 2003, announcing fiscal year
2003 results
99.2 Transcript of fiscal year 2003 results conference call
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