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Best of Howard Stutz

Gaming Guru

Howard Stutz

Shuffle Master retains CEO

17 July 2008

LAS VEGAS, Nevada -- Gaming equipment provider Shuffle Master said Monday it gained commitments for $60 million in bank financing that could grow to as much as $80 million.

The company also said that it has extended its contract with Chairman and CEO Mark Yoseloff through October 2009. The employment agreement for Yoseloff, who has been Shuffle Master's CEO since June 2001, had been set to expire on Oct. 31.

In December, the company said it hired an executive recruitment firm to look for a possible replacement for Yoseloff. In 2007, Yoseloff earned a base salary of $400,000 and a total compensation of $1.7 million.

According to a filing with the Securities and Exchange Commission, the only change in Yoseloff's employment agreement with Shuffle Master was extending the termination date by 12 months.

Shuffle Master did not say if it had halted the work by the executive recruitment firm.

Company officials declined comment.

Shuffle Master said Monday its bank financing is coming from Deutsche Bank Trust Company Americas, Wachovia Bank, National Association and KeyBank National Association with a signed amendment to its existing revolving credit facility.

At the end of June, Las Vegas-based Shuffle Master, which sells and leases gaming equipment to casino operators, registered for a secondary offering of common stock. The company did not disclose the size of the offering, but indicated the total offering price may total up to $86.3 million.

The price of Shuffle Master's shares dropped almost 23 percent that day because Roth Capital Partners gaming analyst Todd Eilers thought the company's proposed secondary offering would dilute earnings more than he originally expected.

Shuffle Master plans to use the proceeds from the offering and its new loan to repay its $150 million convertible notes.

On Monday, shares of Shuffle Master, which is traded on the Nasdaq National Market, closed at $4.14, down 14 cents or 3.27 percent.