912241--3/17/2008--PROGRESSIVE_GAMING_INTERNATIONAL

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{debt, indebtedness, cash}

{stock, price, operating}

{regulation, change, law}

{acquisition, growth, future}

{competitive, industry, competition}

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Risks Relating to Our Business Our cash flow from operations and available credit may not be sufficient to meet our capital requirements and, as a result, we could be dependent upon future financing, which may not be available. We have substantial debt and debt service requirements, which could have an adverse impact on our business and the value of our common stock. Our lenders have imposed numerous debt covenants that include financial and operating restrictions that may adversely affect how we conduct our business and potentially reduce our revenues and affect the value of our common stock. If we are unable to develop or introduce innovative products and technologies that gain market acceptance and satisfy consumer preferences, our current and future revenues will be adversely affected. We may not realize expected benefits from the sale of our table game assets to Shuffle Master. If we are unable to develop new technologies, our products and technologies may become obsolete or noncompetitive. If our current or proposed products or technologies do not receive regulatory approval, our revenue and business prospects will be adversely affected. If our products or technologies currently in development do not achieve commercial success, our future revenue and business prospects could be adversely affected. We may not be successful in forming or maintaining strategic alliances with other companies, which could negatively affect our product offerings and sales. If any conflicts arise between us and any of our alliance partners, our reputation, revenues and cash position could be significantly harmed. Our failure to protect, maintain and enforce our existing intellectual property or secure, maintain and enforce such rights for new proprietary technology could adversely affect our future growth and success. Our competitors may develop non-infringing products or technologies that adversely affect our future growth and revenues. We may incur significant litigation expenses protecting our intellectual property or defending our use of intellectual property, which may have a material adverse effect on our cash flow. If we are found to be infringing on a third-party s intellectual property rights, we may be forced to discontinue certain products or technologies, pay damages or obtain a license to use the intellectual property, any of which may adversely affect our future growth and revenues. Some of our products may contain open source software which may be subject to restrictive open source licenses requiring us to make our source code available to third parties and potentially granting third parties certain rights to the software. We operate in a highly competitive market and may be unable to successfully compete which may harm our operating results. The gaming industry is highly regulated, and we must adhere to various regulations and maintain our licenses to continue our operations. Future authorizations or regulatory approvals may not be granted in a timely manner or at all which would adversely affect our results of operations. Enforcement of remedies or contracts against Native American tribes could be difficult. Our business is closely tied to the casino industry and factors that negatively impact the casino industry may also negatively affect our ability to generate revenues. Economic, political and other risks associated with our international sales and operations could adversely affect our operating results. Holders of our common stock are subject to the requirements of the gaming laws of all jurisdictions in which we are licensed. We may not realize the benefits we expect from the acquisitions of VirtGame and EndX. Future acquisitions could prove difficult to integrate, disrupt our business, dilute stockholder value and strain our resources. Our business will be seriously jeopardized if we are unable to attract and retain key employees. If our products or technologies contain defects, our reputation could be harmed and our results of operations adversely affected. As our business is subject to quarterly fluctuation, our operating results and stock price could be volatile, particularly on a quarterly basis. Risks Relating to Our Securities The share price of our common stock may be volatile and could decline substantially. If our quarterly or annual results are below the expectations of securities market analysts and investors, the price of our common stock may decline. Future sales of our common stock may depress our stock price. We have the ability to issue additional equity securities, which would lead to dilution of our issued and outstanding common stock. We do not intend to pay cash dividends. As a result, stockholders will benefit from an investment in our common stock only if it appreciates in value. Anti-takeover provisions in our organizational documents, our stockholder rights plan and Nevada law could make a third-party acquisition of us difficult and therefore could affect the price investors may be willing to pay for our common stock.

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912241--3/17/2008--PROGRESSIVE_GAMING_INTERNATIONAL_CORP