Suffle Master sells their 50% interest in the Enpat patents to IGT:
Item 1.01 Entry into a Material Definitive Agreement
On July 31, 2006, Shuffle Master, Inc. (NASDAQ National Market: SHFL) (either the “Company,” “we” or “our”) and IGT (NYSE: IGT) (“IGT”) entered into the First Amendment (the “First Amendment”), amending: i) the agreement dated as of April 28, 2006 (the “April Agreement”), and ii) the agreement dated as of June 13, 2005 (the “Patent Purchase Agreement”).
Under the terms of the First Amendment, we have agreed to sell IGT our remaining 50% ownership in U.S. patent numbers 5,735,742 and 5,651,548, which we originally acquired from Enpat Inc. in December, 2004, and which relate to the use of Radio Frequency Identification (“RFID”) at gaming tables and throughout a casino (the “ENPAT Patents”). In consideration for acquiring our remaining interest in the ENPAT Patents, IGT has agreed to pay the Company a non-refundable cash payment of $4.5 million, as an advance discounted amount of the $4.875 million potentially due to us in June, 2007, under the Patent Purchase Agreement, as well as applying the $3.0 million previously paid under the April Agreement to the purchase of our 50% interest. The Patent Purchase Agreement included total initial consideration of $10.5 million of which approximately $1.5 million related to the reimbursement of certain legal fees and the remaining $9 million was for the purchase of a 50% interest in the Enpat Patents, as well as a 50% interest in the Shubert and Fishbine patents, which patents relate to optical bet recognition and chip tracking at gaming tables. Accordingly, total consideration to be received related to the sale of 100% of our interest in the ENPAT Patents is comprised of approximately $9 million paid under the Patent Purchase Agreement, $3.0 million paid under the April Agreement and $4.5 million (to be paid within 10 days) under the First Amendment, for total consideration in excess of $16 million. The First Amendment also grants the Company the right to 17.5% of any future gross royalties in excess of $17.4 million which IGT earns subsequent to the signing of the First Amendment.
<snip>
sec.gov |
