8-K

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 (Date of earliest event reported):  September 29, 2006

SHUFFLE MASTER, INC.
(Exact name of registrant as specified in its charter)

Minnesota	0-20820	41-1448495
(State or Other Jurisdiction	(Commission File Number)	(IRS Employer Identification No.)
of Incorporation or Organization)
1106 Palms Airport Drive
Las Vegas, Nevada		89119-3720
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (702) 897-7150

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

Item 8.01 Other Events

On September 29, 2006, Shuffle Master, Inc. (NASDAQ National Market: SHFL) (the “Company” or “we”), entered into an agreement whereby Shuffle Master has obtained the “last license” rights to utilize an extensive portfolio of jackpot wagering hardware and method patents held by Progressive Gaming International Corporation (“Progressive Gaming”). Under the terms of the agreement, Shuffle Master has the right to utilize the suite of over forty patents on tables and other games in any form including live tables, electronic single and multi-player units, and wireless wagering devices.  Shuffle Master also acquired the right to sub-license use of the technology. Progressive Gaming has further agreed that it will not grant or permit any additional licenses to other manufacturers or suppliers to the technology in the future.  In exchange for a fully-paid, royalty-free, fully-transferable world-wide license to the complete patent suite, Shuffle Master has agreed to a one-time payment of $3.5 million.  A list of patents covered by the licensing agreement is attached hereto as Exhibit 10.1  A copy of the press release announcing the licensing agreement on October 5, 2006 is also attached hereto as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

10.1List of patents covered under the licensing agreement entered into between Shuffle Master Inc. and Progressive Gaming International Corporation on September 29, 2006.

99.1Licensing agreement press release dated October 5, 2006.

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SIGNATURE

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 thereunto duly authorized.

SHUFFLE MASTER, INC.
(Registrant)
Date:	October 5, 2006
/s/ Mark L. Yoseloff
Mark L. Yoseloff
Chairman of the Board and Chief Executive Officer

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EX-10.1

Exhibit 10.1

Exhibit A:              List of Licensed United Patents

Title	Patent No.	Expir. Date
Methods of Progressive Jackpot Gaming	4,861,041	04/18/2008
	5,022,653	Expired
	4,948,134	Expired
	5,288,077	Expired
	5,364,105	Expired
	5,584,485	Expired
Methods of Progressive Jackpot Gaming	5,795,225	04/18/2008
Methods of Progressive Jackpot Gaming	5,913,726	04/18/2008
Methods of Progressive Jackpot Gaming	6,045,130	04/18/2008
Methods of Progressive Jackpot Gaming	6,234,895	04/18/2008
Apparatus for Progressive Jackpot Gaming	5,078,405	04/18/2008
Method for Progressive Jackpot 21	5,364,104	04/18/2008
Method for Playing a Card Game	5,374,067	04/18/2008
Method and Apparatus for Playing Casino Card Games Including	5,377,973	04/18/2008
Method for Playing A Card Game	5,380,012	04/18/2008
Apparatus for Progressive Jackpot Gaming	5,544,893	04/18/2008
Methods of Progressive Jackpot Gaming	5,626,341	04/18/2008
Apparatus for Progressive Jackpot Gaming	5,794,964	04/18/2008
Methods of Progressive Jackpot Gaming	5,795,225	04/18/2008
Coin Acceptor Including Multi-State Visual Indicator Apparatus and	5,836,818	04/18/2008
Apparatus for Progressive Jackpot Gaming	6,070,878	04/18/2008
Apparatus for Progressive Jackpot Gaming	6,073,930	04/18/2008
Method for Progressive Jackpot Gaming	6,312,330	04/18/2008
Method for Progressive Jackpot Gaming	6,336,859	04/18/2008
Apparatus for Progressive Jackpot Gaming	6,475,088	04/18/2008
Method for Progressive Jackpot Gaming	6,485,368	04/18/2008
Apparatus for Progressive Jackpot Gaming	5,078,405	04/18/2008
Methods for Providing a Jackpot in a Progressive Game needed for LRIB with TCP side bet	6,729,620	7/24/2015
Method of Progressive Twenty-One (need for Royal Match 21)	5,577,731	7/24/2015
Maximum Bet Table Game and Apparatus	6,568,682	04/15/2019
Maximum Bet Table Game and Apparatus	6,726,564	04/15/2019
Table Game Apparatus	5,377,994	12/11/2011
	6,375,189	11/20/2017
	6,402,150	11/20/2017
	5,964,464	10/13/2015

Exhibit B:              List of Foreign Patents

Title	Patent No.	Expir. Date	Country
Apparatus for Progressive Jackpot Gaming	2,088,063	4/18/09	Japan
Apparatus for Progressive Jackpot Gaming	621599	4/18/09	Australia
Apparatus for Progressive Jackpot Gaming	694895	4/18/08	Australia
Apparatus for Progressive Jackpot Gaming	E96049	4/18/09	Austria
Apparatus for Progressive Jackpot Gaming	0 338 644	4/18/09	Belgium
Apparatus for Progressive Jackpot Gaming	1,335,381	4/18/09	Canada
Apparatus for Progressive Jackpot Gaming	P689099924	4/18/09	Germany
Apparatus for Progressive Jackpot Gaming	EP0338644	4/18/09	Italy
Apparatus for Progressive Jackpot Gaming	192893	4/18/09	Netherlands and NA
Apparatus for Progressive Jackpot Gaming	EP0338644	4/18/09	Spain
Electronic Poker Game	693882	4/18/08	Australia
Poker Game	4900	9/06/08	Dominican Republic
Gaming Table Apparatus	4825	3/02/08	Dominican Republic
Electronic Poker Game	628044		Australia
Electronic Poker Game	1,334,983		Canada

Exhibit C:              List of Foreign Applications

Title	Applic. No.	Country
Methods of Progressive Jackpot Gaming	617,164	Canada
Electronic Poker Game	616,862	Canada
Methods of Progressive Jackpot Gaming	3,271,374	Australia
Methods of Progressive Jackpot Gaming	616,861	Canada

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE
FOR FURTHER INFORMATION CONTACT: Tom Ryan Investor Relations Advisor ph:          203.222.9013 fax:         203.222.9372	Mark L. Yoseloff, Ph.D., Chairman and CEO Richard Baldwin, Senior Vice President and CFO ph:          702.897.7150 fax:         702.270.5161

SHUFFLE MASTER, INC. ANNOUNCES COMPLETION
OF PATENT LICENSING AGREEMENT WITH
PROGRESSIVE GAMING INTERNATIONAL

Las Vegas, Nevada . . . October 5, 2006 . . . Shuffle Master, Inc. (NASDAQ Global Select Market: SHFL) announced today that it has entered into an agreement whereby Shuffle Master has obtained the “last license” rights to utilize an extensive portfolio of jackpot wagering hardware and method patents held by Progressive Gaming International Corporation (“Progressive Gaming”). Under the terms of the agreement, Shuffle Master has the right to utilize the suite of over forty  patents on tables and other games in any form including live tables, electronic single and multi-player units, and wireless wagering devices.  Shuffle Master also acquired the right to sub-license use of the technology. Progressive Gaming has further agreed that it will not grant or permit any additional licenses to other manufacturers or suppliers to the technology in the future.  In exchange for a fully-paid, royalty-free, fully-transferable world-wide license to the complete patent suite, Shuffle Master has agreed to a modest one-time payment.

“This is an important strategic agreement for Shuffle Master.  This will allow us to add a new element to our existing portfolio of games as well as enhancing new game development.  We are particularly pleased that we have secured these rights across  multiple delivery systems, including live games, electronic games and wireless devices as we see continued evidence of the expansion of alternate delivery methods of game content looking forward,” stated Mark L. Yoseloff, Shuffle Master Chairman and CEO.

Shuffle Master, Inc. is a gaming supply company specializing in providing its casino customers Utility Products, including automatic card shufflers, roulette chip sorters and intelligent table system modules, to improve their profitability, productivity and security, and Entertainment Products, including live proprietary table games, electronic multi-player table game platforms, traditional video slot machines for select markets, live table game tournaments and wireless gaming solutions to expand their gaming entertainment content. The Company is included in the S&P Smallcap 600 Index. Information about the Company and its products can be found on the Internet at www.shufflemaster.com.

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This release contains forward-looking statements that are based on management’s current beliefs and expectations about future events, as well as on assumptions made by and information available to management. The Company considers such statements to be made under the safe harbor created by the federal securities laws to which it is subject, and assumes no obligation to update or supplement such statements. Forward-looking statements reflect and are subject to risks and uncertainties that could cause actual results to differ materially from expectations. Factors that could cause actual results to differ materially from expectations include, but are not limited to, the following: changes in the level of consumer or commercial acceptance of the Company’s existing products and new products as introduced; advances by competitors; acceleration and/or deceleration of various product development, promotion and distribution schedules; product performance issues; higher than expected manufacturing, service, selling, administrative, product development, promotion and/or distribution costs; changes in the Company’s business systems or in technologies affecting the Company’s products or operations; reliance on strategic relationships with distributors and technology and manufacturing vendors; current and/or future litigation or claims; tax matters, including changes in tax legislation or assessments by taxing authorities; acquisitions or divestitures by the Company or its competitors of various product lines or businesses and, in particular, integration of businesses that the Company may acquire; changes to the Company’s intellectual property portfolio, such as the issuance of new patents, new intellectual property licenses, loss of licenses, claims of infringement or invalidity of patents; regulatory and jurisdictional issues (e.g., technical requirements and changes, delays in obtaining necessary approvals, or changes in a jurisdiction’s regulatory scheme or approach, etc.) involving the Company and its products specifically or the gaming industry in general; general and casino industry economic conditions; the financial health of the Company’s casino and distributor customers, suppliers and distributors, both nationally and internationally; the Company’s ability to meet its debt service obligations, including the Notes, and to refinance its indebtedness, which will depend on its future performance and other conditions or events and will be subject to many factors that are beyond the Company’s control; and various risk related to the Company’s customers’ operations in countries outside the United States, including currency fluctuation risks, which could increase the volatility of the Company’s results from such operations. Additional information on these and other risk factors that could potentially affect the Company’s financial results may be found in documents filed by the Company with the Securities and Exchange Commission, including the Company’s current reports on Form 8-K, quarterly reports on Form 10-Q and annual report on Form 10-K.

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