UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)
    X      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
   ---     EXCHANGE ACT OF 1934

           For the quarterly period ended:   December 31, 1998             
                                             -----------------      

                                       OR

   ---     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
           EXCHANGE ACT OF 1934

           For the transition period from _______________ to __________________

Commission file number    0-27226                                              
                         ---------
                        
                       SPINTEK GAMING TECHNOLOGIES, INC.
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

            Nevada                                              33-0134823
-------------------------------                             -------------------
(State or other jurisdiction of                               (IRS Employer
incorporation or organization)                              Identification No.)

           1857 Helm Drive, Las Vegas, Nevada               89119  
--------------------------------------------------------------------------------
        (Address of principal executive offices)          (Zip Code)

                                  (702)263-3660
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

                   901-B Grier Drive, Las Vegas, Nevada 89119
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

         Indicate  by check mark  whether the issuer (1) filed all reports to be
filed by  Section  13 or 15(d) of the  Exchange  Act of 1934  during the past 12
months (or for such shorter period that the registrant was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days.          Yes _X_    No ___

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date:

   18,793,993 shares of Common Stock, $0.002 par value as of January 31, 1999
   --------------------------------------------------------------------------

                                       1
<PAGE>
                        SPINTEK GAMING TECHNOLOGIES, INC.
<TABLE>
<CAPTION>

                                   FORM 10-QSB

                                TABLE OF CONTENTS
                                                                                Page No.
                                                                                --------


<S>        <C>                                                                   <C>
PART I.    FINANCIAL INFORMATION

   Item 1.   Financial Statements
              Consolidated Balance Sheets at December 31, 1998 and June 30, 1998    3
              Consolidated Statements of Operations for the Three Months and Six
                    Months Ended December 31, 1998 and 1997                         4
              Consolidated Statements of Cash Flows for the Six Months Ended
                    December 31, 1998 and 1997                                      5
              Notes to Consolidated Financial Statements                            7

   Item 2.   Management's Discussion and Analysis of Financial Condition and
             Results of Operations
                                                                                    9

PART II.   OTHER INFORMATION

   Item 1.   Legal Proceedings                                                     14

   Item 2.   Changes in Securities                                                 14

   Item 3.   Defaults Upon Senior Securities                                       14

   Item 4.   Submission of Matters to a Vote of Security Holders                   14

   Item 5.   Other Information                                                     14

   Item 6.   Exhibits and Reports on Form 8-K                                      14

SIGNATURE PAGE                                                                     15

EXHIBIT INDEX                                                                      16

</TABLE>
                                       2
<PAGE>
            SPINTEK GAMING TECHNOLOGIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
                        CONSOLIDATED BALANCE SHEETS
                              (In thousands)
                                (Unaudited)

                                                                  December 31,  June 30,
                                                                      1998        1998
                                                                  ----------- ----------
<S>                                                               <C>         <C>     
                                  ASSETS
Current assets:
  Cash ........................................................   $    176    $    500
  Accounts receivable, net ....................................        447         229
  Prepaid and other current assets ............................         74          46
  Inventories, net ............................................      1,813         679
                                                                  --------    --------
    Total current assets ......................................      2,510       1,454

Furniture, fixtures and equipment, net ........................        210         144
Licenses and patents ..........................................      1,004       1,019
Other assets ..................................................        116         126
                                                                  --------    --------

Total assets ..................................................   $  3,840    $  2,743
                                                                  ========    ========

                   LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
  Accounts payable ............................................   $    888    $    852
  Demand notes payable to affiliates ..........................       --           190
  Accrued liabilities .........................................        758         640
  Accrued interest ............................................        173          53
  Customer deposits ...........................................         33         247
  Dividends payable ...........................................        651         485
                                                                  --------    --------
    Total current liabilities .................................      2,503       2,467
                                                                  --------    --------

Long-term debt ................................................      5,000       2,350
                                                                  --------    --------

Stockholders' deficit:
  Convertible preferred stock, no par value, 100,000 shares
    authorized, 8,241 shares issued and outstanding ...........      5,355       5,355
  Common stock, $.002 par value, 100,000,000 shares authorized,
    20,111,322 and 19,990,384 shares issued and outstanding ...         40          40
  Additional paid-in capital ..................................      5,716       5,855
  Accumulated deficit .........................................    (14,745)    (13,295)
  Treasury stock, 1,317,329 shares, at cost ...................        (29)        (29)
                                                                  --------    --------
    Total stockholders' deficit ...............................     (3,663)     (2,074)
                                                                  --------    --------

Total liabilities and stockholders' deficit ...................   $  3,840    $  2,743
                                                                  ========    ========
</TABLE>

        See accompanying Notes to Consolidated Financial Statements

                                     3


<PAGE>

               SPINTEK GAMING TECHNOLOGIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In thousands, except per share data)
                                   (Unaudited)


                                                 Three Months Ended      Six Months Ended
                                                    December 31,           December 31,
                                                  1998       1997         1998       1997
                                               ---------   --------    ---------   --------
<S>                                            <C>         <C>         <C>         <C>   
Sales ......................................   $  1,007    $   --      $  2,009    $   --
Cost of sales ..............................        578        --         1,121        --
                                               --------    --------    --------    --------
  Gross profit .............................        429        --           888        --

Selling, general and administrative expenses      1,055         921       2,035       1,605
Research and development expense ...........         79         303         164         468
                                               --------    --------    --------    --------

  Operating loss ...........................       (705)     (1,224)     (1,311)     (2,073)

Other income (expense):
  Interest income ..........................         23           2          34           5
  Depreciation and amortization ............        (27)        (11)        (38)        (20)
  Interest expense .........................        (72)         (9)       (135)        (21)
                                               --------    --------    --------    --------
Net loss ...................................       (781)     (1,242)     (1,450)     (2,109)
Dividends on convertible preferred stock ...        (83)        (86)       (166)       (159)
                                               --------    --------    --------    --------

Net loss applicable to common shares .......   $   (864)   $ (1,328)   $ (1,616)   $ (2,268)
                                               ========    ========    ========    ========

Loss per common share information: 
   Weighted average common shares:
    Basic ..................................     18,793      17,172      18,733      16,487
                                               ========    ========    ========    ========
    Diluted ................................     18,793      17,172      18,733      16,487
                                               ========    ========    ========    ========

  Net loss per common share:
    Basic ..................................   $  (0.05)   $  (0.08)   $  (0.09)   $  (0.14)
                                               ========    ========    ========    ========
    Diluted ................................   $  (0.05)   $  (0.08)   $  (0.09)   $  (0.14)
                                               ========    ========    ========    ========
</TABLE>


           See accompanying Notes to Consolidated Financial Statements


                                        4
<PAGE>

               SPINTEK GAMING TECHNOLOGIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)

                                                              Six Months Ended
                                                                December 31,
                                                            --------------------
                                                              1998        1997
                                                            --------    --------
<S>                                                         <C>         <C>     
Cash flows from operating activities:
  Net loss .............................................    $(1,450)    $(2,109)
  Adjustments to reconcile net loss to net cash used
   in operating activities:
    Depreciation and amortization ......................         38          20
    Non-cash interest expense ..........................        126        --
    Allowance for inventory obsolescence ...............        (30)         14
    Provision for bad debts ............................       --            60
    Non-cash operating expenses for common stock .......       --            27
    Royalty expense used to reduce note receivable
     from related company ..............................       --            51
  (Increase) decrease in assets:
    Accounts receivable ................................       (223)       --
    Inventory ..........................................     (1,103)       (154)
    Prepaid expenses and other .........................        (15)         75
  Increase (decrease) in liabilities:
    Accounts payable ...................................         36         124
    Accrued liabilities ................................        119         150
    Accrued interest ...................................       --             4
    Customer deposits ..................................       (215)         76
                                                            -------     -------
Net cash used in operating activities ..................     (2,717)     (1,662)
                                                            =======     =======

Net cash used in investing activities:
  Purchase of furniture, fixtures and equipment ........        (87)        (53)
                                                            -------     -------

Cash flows from financing activities:
  Proceeds from issuance of convertible debentures .....      2,650        --
  Proceeds from (repayment of) demand notes
    payable to affiliates and stockholders .............       (170)        470
  Proceeds from issuance of preferred stock ............       --           975
                                                                        -------
Net cash provided by financing activities ..............      2,480       1,445
                                                            -------     -------

Net decrease in cash and cash equivalents ..............       (324)       (270)
Cash and cash equivalents, beginning of period .........        500         404
                                                            -------     -------

Cash and cash equivalents, end of period ...............    $   176     $   134
                                                            =======     =======

</TABLE>

           See accompanying Notes to Consolidated Financial Statements


                                        5
<PAGE>
               SPINTEK GAMING TECHNOLOGIES, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)

                                                              Six Months Ended
                                                                 December 31,
                                                               ---------------
                                                                1998     1997
                                                               ------   ------
<S>                                                            <C>      <C>   
Supplemental schedule of non-cash investing and 
  financing activities:
    Dividends payable on preferred stock ...................   $ (166)  $(159)
                                                               ======   =====

    Issuance of common stock for debt ......................   $   26   $ 500
                                                               ======   =====

    Issuance of common stock in lieu of cash for fees
      related to preferred stock transaction ...............   $  --    $ 110
                                                               ======   =====


Supplemental disclosure of cash flow information:
    Cash paid for interest .................................   $    8   $  11
                                                               ======   =====
</TABLE>

           See accompanying Notes to Consolidated Financial Statements


                                        6

<PAGE>

               SPINTEK GAMING TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The  consolidated  financial  statements  include the accounts of Spintek Gaming
Technologies,  Inc.  and  its  wholly  owned  subsidiary  Spintek  Gaming,  Inc.
("Gaming"),   and  Gaming's  wholly  owned   subsidiary,   Spinteknology,   Inc.
(collectively  the "Company").  All significant  intercompany  transactions have
been eliminated.

The  consolidated  balance  sheet  as of  December  31,  1998  and  the  related
consolidated  statements of operations for the three months and six months ended
December 31, 1998 and 1997 and consolidated statements of cash flows for the six
months  ended  December 31, 1998 and 1997 are  unaudited  but, in the opinion of
management, reflect all adjustments necessary for a fair presentation of results
for those  periods.  The  results of  operations  for an interim  period are not
necessarily  indicative  of the  results  for the full  year.  The  consolidated
financial  statements  should  be  read in  conjunction  with  the  consolidated
financial  statements and notes thereto contained in the Company's annual report
on Form 10-KSB for the year ended June 30, 1998.

From  inception in March 1995 through the third quarter of the Company's  fiscal
year ended June 30, 1998, the Company and its  subsidiaries  reported  operating
activities as a development stage enterprise.  Since early 1996, the Company has
devoted its efforts to the development of proprietary technology for determining
the contents of a slot machine hopper and an on-line data collection system that
allows a casino to utilize the  financial and security  information.  During the
third and fourth  quarters of fiscal 1998, the Company began to actively  market
and sell products to the casino industry utilizing this proprietary  technology.
Therefore,  commencing  with the Form  10-KSB for the year ended June 30,  1998,
management  determined that the Company should no longer be a development  stage
enterprise for financial  reporting purposes.  Hence,  cumulative from inception
financial  information has been eliminated from the  Consolidated  Statements of
Operations and Consolidated Statements of Cash Flows.


NOTE 2 - LICENSES AND PATENTS

In  October  1998,  the  Company  was  awarded a patent by the U.S.  Patent  and
Trademark Office ("USPTO").  This patent encompasses hopper weighing  technology
used by the Company to thwart technician fraud as well as providing for drop box
counting and weighing of coins.  It also  enumerates  other possible uses of the
weighing  technology  and allows for the expansion of claims in further  filings
with USPTO.  Similar  patents have previously been awarded to the Company by the
Department of Trade and Industry, Republic of South Africa in July 1997, and the
European Patent  Organization  ("E.P.O.") in 1998.  Patents issued by the E.P.O.
are  applicable for eighteen  contracting  European  states and four  designated
extension European states. The E.P.O. patent is applicable for the five European
states in which Azkoyen, a Spanish company, has pending patent applications that
may be deemed similar to the Company's E.P.O. patents.  Though the granting of a
patent  to the  Company  in  the  E.P.O.  states  is  considered  a  mandate  of
intellectual  property rights, and management  believes the Company's claims are
valid and intends to vigorously  assert its rights, it is unable to estimate the
possible outcome or the ultimate  financial effect of any potential  proceedings
regarding this matter.

                                       7
<PAGE>
NOTE 3 - LONG-TERM DEBT

         During the first six months of fiscal 1999,  the Company  completed the
offering of its  $5,000,000  6% Secured  Convertible  Notes (the  "Notes").  The
Malcolm C.  Davenport  V Family  Trust (the  "Trust")  purchased  an  additional
$2,400,000  of the  Notes,  increasing  the  Trust's  holdings  of the  Notes to
$4,300,000;  and a member of the Board of  Directors  at the time  purchased  an
additional  $250,000  of the  Notes,  increasing  his  holdings  in the Notes to
$350,000.


                                       8
<PAGE>
ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Certain  information  included herein contains statements that may be considered
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of 1933 and  Section 21E of the  Securities  Exchange  Act of 1934,  such as
terms expressing future  expectations,  enthusiasm about future  potential,  and
anticipated  growth  in  sales,  revenues  and  earnings.   All  forward-looking
statements,  although  made in good faith,  are subject to  important  risks and
uncertainties that could significantly  affect anticipated results in the future
and, accordingly, results may differ from those expressed in any forward-looking
statements made herein. Such statements are necessarily  speculative and factors
including,  but not limited to, unusual  production or supply problems,  unusual
risks attending foreign transactions, year 2000 problems, competitive pressures,
unanticipated  problems in obtaining approvals and/or licenses from governmental
authorities as to products or the ability to sell products in any  jurisdiction,
a general  deterioration in domestic or global economic conditions,  and changes
in  federal  or  state  tax  laws or laws  permitting  legalized  gaming  in any
jurisdiction within which gaming is currently conducted or the administration of
such laws, could cause results to differ materially from those projected.

Year 2000 Considerations

The Company's hopper weighing technology is date sensitive and both the hardware
and  software are Year 2000  compliant.  The  Company's  primary  customers  are
casinos with slot  machines into which the  Company's  product is installed.  In
addition,  many casinos  utilize slot  machine  accounting  systems to which the
Company's  product  must  interface.  Although  the  Company  has  not  received
assurances  from the primary  slot  machine  manufacturers  or the slot  machine
accounting  system  manufacturers as to the Year 2000 issue, the Company expects
that at least a majority of these manufacturers will be Year 2000 compliant.

The Company has initiated a program of contacting  its primary  suppliers of key
components of its hopper weighing system to receive assurance that the Year 2000
issue will not directly impact their ability to supply the Company with product.
In  addition,  the  Company  has  located  alternative  sources for all such key
components.

The  Company  has  recently  installed a  manufacturing,  inventory  control and
accounting software system that has been represented by the developer to be Year
2000 compliant.

Maintenance or  modification  costs  associated with the Year 2000 issue will be
expensed as incurred,  while the costs of any new software  will be  capitalized
and amortized  over the  software's  useful life. The Company does not expect to
incur  costs in  connection  with the Year 2000 issue that would have a material
impact on operations.

Material Changes in Results of Operations

Background Information

From  inception in March 1995 through the third quarter of the Company's  fiscal
year ended June 30, 1998, the Company realized minimal revenues from the sale of
its products,  with its first sale in the amount of $180,000  having occurred in
March 1998. As a result,  the Company  filed its quarterly and annual  financial
reports as a development  stage  enterprise  through the quarter ended March 31,
1998. With the commencement of active sales and marketing activity in the latter
stages of fiscal 1998,  management  determined that the Company should no longer
report as a development stage  enterprise.  

                                       9
<PAGE>
Commencing  with the  annual  report on Form  10-KSB for the year ended June 30,
1998, the cumulative from inception  financial  information was deleted from the
Consolidated  Statements of Operations,  Cash Flows and Changes in Stockholders'
Equity (Deficit).

Since early 1996,  the  Company  has devoted its efforts to the  development  of
proprietary technology for determining the contents of a slot machine hopper and
an on-line data collection  system that allows a casino to utilize the financial
and security information ("AccuSystem" or "AccuHopper"(TM)). During fiscal 1998,
the Company,  after various field trials,  received  approval of its stand alone
AccuSystem from Gaming  Laboratories  International,  from the states of Nevada,
Mississippi and New Jersey,  and from Native American tribal  authorities in the
states of  Connecticut  and  Minnesota.  In  addition,  the Company is currently
engaged in beta site  testing of the  interface  of  AccuSystem  with three slot
machine  accounting  systems,  including two of the principal  systems  utilized
throughout the gaming industry, Bally Systems and Casino Data Systems. The third
beta site is a system that is  exclusively  utilized by a multiple  hotel/casino
operator  based in  Southern  Nevada.  The  Company is also  working  with other
manufacturers of slot machine accounting systems, including IGT's new IGS system
and Advanced  Casino Systems  Corporation,  on the interface of AccuSystem  with
their  products.  Although  management  is  confident  that  AccuSystem  will be
successfully  interfaced with these slot accounting systems, no assurance can be
given that such interfaces will ultimately be successful or, if successful, will
receive the necessary approvals from the gaming authorities in the jurisdictions
in which such slot accounting systems are utilized.

In December 1998,  the Company  received  notification  from the State of Nevada
Gaming  Control Board  ("NGCB") that  AccuSystem  had been  authorized to be the
second  verifier of a slot  machine  fill,  thereby  eliminating  the need for a
second employee to observe each fill and sign the required fill documentation in
Nevada casinos.  This authorization will be granted to casinos on a case by case
basis by the  NGCB  provided  a  casino's  accounting  and  auditing  procedures
adequately  substitute  for the lack of the second  signature  verification.  In
management's  opinion,  this was a  significant  event for the Company in that a
casino  utilizing  AccuSystem  will be able to reduce  slot  machine  down time,
reduce labor costs  associated  with the fill  process,  and  increase  customer
satisfaction  through the  elimination of the second person in the fill process.
The Company is assisting certain casinos in other domestic gaming  jurisdictions
in their requests to have AccuSystem  authorized to be the second verifier,  and
to be able to utilize  certain  other  features  of the  AccuSystem  designed to
enhance  revenues and reduce  operating  costs.  No assurance  can be given that
these  requests  will  ultimately be approved by the gaming  authorities  in the
jurisdictions  wherein they are pending,  or that a significant number of Nevada
casinos will satisfy the NGCB's internal control requirement and thereby qualify
for the single signature fill authorization.

The  accompanying  financial  statements for the prior periods  reflect  certain
reclassifications,  which  have no effect on net  losses or cash  flows in those
periods, to conform to classifications in the current period.

Six Months Ended December 31, 1998 and 1997

During  the first six  months of fiscal  1999,  the  Company  reported  sales of
approximately  $2,009,000,  which included sales in Mississippi,  Minnesota, New
Jersey,  Iowa and Nevada.  The gross margin was  approximately  44% and reflects
discounts  from the listed  sales  prices to  introduce  product in the  various
domestic markets and to establish a customer base. In addition, the gross margin
was  negatively  impacted  by  costs  associated  with  the  adaptation  of  the
AccuSystem  product to the assortment of slot machines into which the AccuSystem
is to be  installed.  As of February 9, 1999,  the  Company's  sales backlog was
approximately $1,700,000.

Selling,   general  and   administrative   expenses   increased   $430,000,   or
approximately 27%, to $2,035,000 for the six months ended December 31, 1998 from
$1,605,000  for the six months ended  December 31, 

                                       10
<PAGE>
1997.  When  comparing  the two six month  periods,  an  increase in payroll and
payroll  related  expenses of $615,000 to  $1,037,000  was  partially  offset by
decreases of $60,000 in bad debt expense and $155,000 in accrued  expenses  that
are based on fiscal period changes in the market capitalization of the Company's
common  stock.  The  increase  in payroll  and  payroll  related  expenses  were
primarily related to additional administrative,  product development and support
personnel  necessitated  by sales  activities,  and  approximately  $150,000  in
engineering  labor  costs  that  would  have been  classified  as  research  and
development expense in the prior year period.

Research and development expenses decreased by $304,000,  or 64%, to $164,000 in
the current  period from  $468,000 in the six month  period  ended  December 31,
1997. Whereas all engineering and product development expenses in the prior year
period were  classified  as research and  development  expenses,  only  expenses
associated  with  new  product   development  are  classified  as  research  and
development expenses in the current year period. Expenses related to the further
development  of  the  AccuSystem   product,   including  costs  associated  with
interfacing  with the various slot accounting  systems and design  modifications
necessitated  by  slot  machine  cabinet  and  design  variations  are  expensed
elsewhere in the financial statements.

Interest  expense  increased to $135,000  for the six months ended  December 31,
1998 from $21,000 in the prior year period as a result of the issuance of the 6%
Secured  Convertible  Notes  from  the  $5.0  million  offering  (the  "Notes").
Depreciation  and  amortization  increased to $38,000 in the first six months of
fiscal 1999 from $20,000 in the same period in the prior year,  primarily due to
amortization of the AccuSystem patent costs.


Three Months Ended December 31, 1998 and 1997

During  the  second  quarter  of fiscal  1999,  the  Company  reported  sales of
approximately  $1,007,000.  The gross margin was approximately  43%,  reflecting
discounts  from the listed  sales  prices to  introduce  product in the  various
domestic markets and to establish a customer base. In addition, the gross margin
was  negatively  impacted  by costs  associated  with the  customization  of the
AccuSystem  product to the assortment of slot machines into which the AccuSystem
is to be installed.

Selling,   general  and   administrative   expenses   increased   $133,000,   or
approximately  14%, to $1,055,000  for the quarter ended  December 31, 1998 from
$922,000 in the same period in the prior year.  In the current  year's  quarter,
payroll and payroll related expenses were approximately $568,000,  reflecting an
increase of approximately $316,000 over prior year's payroll and payroll related
expenses.  This increase in payroll and payroll  related  expenses was primarily
due to additional  administrative,  product  development  and support  personnel
necessitated by sales activities, and approximately $87,000 in engineering labor
costs that would have been classified as research and development expense in the
prior year period. When comparing the two quarters,  the increase in payroll and
payroll  related  expenses  were  offset by a  decrease  of  $60,000 in bad debt
expense,  $25,000 in royalty  amortization,  $27,000  in  non-cash  compensation
expense, and $55,000 in accrued expenses that are based on fiscal period changes
in the market capitalization of the Company's common stock.

Research and development  expenses decreased by $223,000,  or 74%, to $79,000 in
the  current  year's  second  quarter.   Whereas  all  engineering  and  product
development expenses were classified as research and development expenses in the
quarter  ended  December 31, 1997,  only  expenses  associated  with new product
development  are classified as research and  development  expense in the quarter
ended  December 31, 1998.  Expenses  related to the further  development  of the
AccuSystem product, including costs associated with interfacing with the various
slot accounting  systems and design  modifications  necessitated by slot machine
cabinet  and  design   variations  are  expensed   elsewhere  in  the  financial
statements.

                                       11
<PAGE>
Interest  expense  increased to $71,000 for the quarter ended  December 31, 1998
from $9,000 in the same quarter in the prior year as a result of the issuance of
the Notes.  Depreciation  and  amortization  increased to $27,000 in the current
year's  quarter from $11,000 for the three month period ended December 31, 1997,
primarily due to amortization of the AccuSystem patent costs.

Liquidity and Capital Resources

The Company's current assets at December 31, 1998 totaled $2,510,000,  including
$176,000 in cash and cash equivalents and $1,813,000 in inventory. The Company's
current liabilities were $2,503,000,  including $651,000 in dividends payable to
preferred  stockholders  and $173,000 in interest on the Notes. Net cash used in
operating activities was approximately  $2,717,000.  As of February 9, 1999, the
Company had a sales backlog of approximately $1,700,000.

As  previously  noted,  the Company's  initial  sales and  marketing  activities
commenced  in the latter  stages of the fiscal year ended June  30,1998.  Absent
significant  revenues from  operations,  the Company has funded itself primarily
through equity and debt financing.

On February 27, 1998, the Company  initiated the private  placement of the Notes
in two  separate  offerings  with  identical  terms due February 28, 2008 in the
aggregate  principal  amount of $5,000,000 to a limited number of investors with
interest payable annually commencing February 28, 1999. The Notes are secured by
a security interest and collateral  assignment of all of the Company's  patents,
patent  applications,  trade  secrets and all other  intellectual  rights of the
Company  existing or developed prior to the repayment or other settlement of the
Notes (the "Intellectual  Rights").  The Notes are convertible by holders of the
Notes at any time through  February 28, 2001 into shares of the Company's $0.002
common  stock in a number  equal to 0.8% of the then  outstanding  shares of the
Company's  common stock for each $100,000 in principal  amount of the Notes.  In
addition,  the Company may require  conversion at certain times through February
28, 2001 under certain circumstances.

During the six month period ended  December  31,  1998,  the Company  closed the
$5,000,000  Note  offering,  with the Malcolm C.  Davenport V Family  Trust (the
"Trust")  purchasing  an  additional  $2,400,000  of the Notes from the  Company
during  the six month  period.  Consequently  the  Trust,  for which  Malcolm C.
Davenport  V (a member of the Board of  Directors)  serves as  Trustee,  holds a
total  of  $4,300,000  of the  Notes.  In  addition,  a member  of the  Board of
Directors at the time  purchased an additional  $250,000 of the Notes,  bringing
his holdings in the Notes to $350,000.  In January 1999,  Malcolm C. Davenport V
loaned the Company an  additional  $350,000  pursuant to the terms of a 10% note
due March 20, 1999 which is secured by the  Company's  Intellectual  Rights in a
position subordinate to that of the holders of the Notes.

In addition to the Notes,  there were 8,241 issued and outstanding  shares of 4%
Convertible  Preferred Stock at December 31, 1998.  These preferred  shares were
held  by  RBB  Bank   Aktiengesellschaft   (the  "Holder"),   an  offshore  bank
representing investors pursuant to Regulation S promulgated under the Securities
Act of 1933. All such  preferred  stock,  plus any accrued and unpaid  dividends
thereon,  can be  converted  into common stock of the Company at any time at the
discretion  of the  Holder,  and any  preferred  stock  not  converted  prior to
December  31,  1999 will  automatically  be  converted  on that date based on an
average of the closing bid prices of the common  stock for the five trading days
ended immediately prior to that date, but not to exceed $3 per share.

If both the Notes and the Preferred  Stock had been  converted  into  additional
shares of the  Company's  common stock on December 31, 1998,  the holders of the
Notes would have received  approximately  30.9 million common shares,  including
26.6  million  to the  Trust,  and RBB would have  received  approximately  27.5
million shares.

                                       12
<PAGE>
As  previously  noted,  the Company is  currently  undergoing  beta site testing
and/or assisting with certain casino's applications for the amendment of certain
internal  control  procedures  related  to slot  machines  in  various  domestic
jurisdictions.   Management   feels  that  if  these  beta  site  tests   and/or
applications  for the  amendment  of certain  internal  control  procedures  are
successful, an increase in sales will result. No assurance can be given that the
field  trials or the  applications  for  amendment of certain  internal  control
procedures will be successful in any jurisdictions,  or if obtained, will result
in increased sales to the Company.

Should the Company fail to generate  sufficient  revenues to support operations,
the Company would have to secure  additional debt or equity  financing.  If this
additional debt or equity  financing  should not be available,  and no assurance
can be given that such additional debt or equity  financing can be located,  and
if the Company can not generate sufficient  revenues to support operations,  the
Company will be unable to continue as a going concern.


                                       13
<PAGE>
PART II.  OTHER INFORMATION

ITEM 1.  Legal Proceedings

         On January 22, 1999,  the Washoe County (Reno),  Nevada  District Court
granted  the  Company's  motion  for  summary  judgment  and  dismissed  without
prejudice the lawsuit filed against the Company by Richard M. Mathis ("Mathis").
Mathis  had  filed  suit  in  October   1996   against  the   Company,   Spintek
International, Inc. and Lanier M. Davenport ("Davenport") who, until October 18,
1996, was chairman and chief executive  officer of the Company.  In his lawsuit,
Mathis had alleged that Davenport, with the Company's assistance,  had defrauded
him,  breached a fiduciary  duty to him,  and was seeking  actual  damages of in
excess of $500,000 and punitive damages of in excess of $500,000.

ITEM 2.  Changes in Securities

         None

ITEM 3.  Defaults upon Senior Securities

         None

ITEM 4.  Submission of Matters to a Vote of Security Holders

         None

ITEM 5.  Other Information

         None

ITEM 6. Exhibits and Reports on Form 8-K

       (a) Exhibits

         10.1 Employment Agreement with Gary Coulter dated December 10, 1998
         27.1 Financial Data Schedule.

       (b) Reports on Form 8-K

         None


                                       14
<PAGE>
                                   SIGNATURES

Pursuant to the requirements of Section 13 of the Securities and Exchange Act of
1934,  the  Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                        SPINTEK GAMING TECHNOLOGIES, INC.


Date:  February 10, 1999                     By: /s/ GARY L. COULTER            
                                                 ------------------------------
                                                     Gary L. Coulter
                                                     Chairman of the Board,    
                                                     Chief Executive Officer

Date:  February 10, 1999                     By: /s/ GEORGE P. MILLER           
                                                 -----------------------------
                                                     George P. Miller
                                                     Chief Financial Officer
                                                    (Principal Financial
                                                     and Accounting Officer)


                                       15

<PAGE>
                                  EXHIBIT INDEX

Exhibit Index                    Description                         Page Number
-------------                    -----------                         -----------

  10.1  Employment Agreement with Gary Coulter dated December 10, 1998     E-1
  27.1  Financial Data Schedule                                            E-10






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