COMMON STOCK AND WARRANT PURCHASE AGREEMENT

Exhibit 10.2

COMMON STOCK AND WARRANT PURCHASE AGREEMENT

THIS COMMON STOCK AND WARRANT PURCHASE AGREEMENT (the “ Agreement ”) is entered into as of                             , 2008 , by and among Progressive Gaming International Corporation, a Nevada corporation (the “ Company ”), with headquarters located at 920 Pilot Road Las Vegas, NV 89119, and Private Equity Management Group Financing Corporation, a California corporation (the “ Purchaser ”), with regard to the following:

RECITALS

A. The Company and Purchaser are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the provisions of Regulation D (“ Regulation D ”), as promulgated by the United States Securities and Exchange Commission (the “ SEC ”) under the Securities Act of 1933, as amended (the “ Securities Act ”).

B. The Purchaser desires to purchase, upon the terms and conditions stated in this Agreement, (a) shares of the Company’s Common Stock, $0.10 par value per share (the “ Common Stock ”) and (b) a warrant (the “ Warrant ”) to purchase shares of Common Stock, in the form attached hereto as Exhibit A . The shares of Common Stock issuable upon exercise of or otherwise pursuant to the Warrant are referred to herein as “ Warrant Shares .” The shares of Common Stock (exclusive of the Warrant Shares) issued to the Purchaser hereunder at the Closing (as hereinafter defined) are referred to herein as the “ Initial Shares .” Any shares of Common Stock issued to the Purchaser hereunder subsequent to the Closing are referred to herein as the “ Additional Shares ” (and, together with the Initial Shares, the “ Common Shares ”). The Common Shares, the Warrant and the Warrant Shares are collectively referred to herein as the “ Securities ”.

C. The parties hereto have executed and delivered a Credit Agreement (the “ Credit Agreement ”) pursuant to which the Purchaser shall make available to the Company proceeds from a senior secured credit facility in consideration of which the parties hereto are entering into this Agreement. Capitalized terms not defined herein shall have the meaning ascribed to them in the Credit Agreement.

D. Contemporaneously with the funding of the Loans pursuant to the Credit Agreement, the parties hereto are executing and delivering this Agreement and a Registration Rights Agreement in the form attached hereto as Exhibit B (the “ Registration Rights Agreement ” and collectively with this Agreement, the Warrant and any other documents or agreements executed in connection with the transactions contemplated hereunder, the “ Transaction Documents ”), pursuant to which the Company has agreed to provide certain registration rights under the Securities Act, the rules and regulations promulgated thereunder and applicable state securities laws.

AGREEMENTS

NOW, THEREFORE, in consideration of their respective promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Purchaser hereby agree as follows:

ARTICLE I

ISSUANCE AND SALE OF COMMON STOCK AND WARRANT

1.1 Issuance of Initial Shares and Warrant . In partial consideration of the provision of credit to the Company pursuant to the Credit Agreement and subject to the terms and conditions of this Agreement, the issuance of One Million (1,000,000) Initial Shares and Warrant to the Purchaser shall be consummated in a “ Closing .”

1.2 Issuance of Additional Shares . In partial consideration of the provision of credit to the Company pursuant to the Credit Agreement and if on November 15, 2008, the dollar volume weighted average price of the Common Stock as traded on the NASDAQ Global Market (“ Nasdaq ”) for the twenty (20) trading days prior to such date (determined as of such date) (the “ 20-day VWAP ”) does not equal or exceed $1.50, then the Company shall issue Additional Shares to Purchaser such that the sum of the Additional Shares plus the Initial Shares multiplied by the 20-day VWAP equals a total value of One Million Five Hundred Thousand Dollars ($1,500,000), provided , that, in no event may the aggregate number of Additional Shares issued exceed 900,000 shares of Common Stock.

1.3 Closing Date . Subject to the satisfaction (or waiver) of the conditions set forth in ARTICLES VI and VII below, the date and time of the issuance, sale and purchase of the Initial Shares and Warrant pursuant to this Agreement shall be at 12:00 noon Eastern Time, on August 15, 2008.

ARTICLE II

PURCHASER’S REPRESENTATIONS AND

WARRANTIES

The Purchaser represents and warrants to the Company, as of the date hereof and as of the Closing that the following statements are true and correct:

2.1 Incorporation and Standing . Purchaser is a corporation duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation. Purchaser’s corporate headquarters are in the State of California.

2.2 Authorization; Enforcement . This Agreement and the Registration Rights Agreement have been duly and validly authorized, executed and delivered on behalf of Purchaser and are valid and binding agreements of Purchaser enforceable in accordance with their respective terms, except to the extent that such validity or enforceability may be subject to or affected by any bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally the enforcement of, creditors’ rights or remedies of creditors generally, or by other equitable principles of general application.

2.3 Investment Purpose . Purchaser is purchasing the Securities for Purchaser’s own account for investment only and not with a view toward or in connection with the public sale or distribution thereof. Purchaser will not, directly or indirectly, offer, sell, pledge or otherwise transfer its Securities or any interest therein except pursuant to transactions that are exempt from the registration requirements of the Securities Act and/or sales registered under the Securities Act. Purchaser understands that Purchaser must bear the economic risk of this

investment indefinitely, unless the Securities are registered pursuant to the Securities Act and any applicable state securities laws or an exemption from such registration is available, and that the Company has no present intention of registering any such Securities other than as contemplated by the Registration Rights Agreement.

2.4 Accredited Investor Status . Purchaser is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D.

2.5 Reliance on Exemptions . Purchaser understands that the Securities are being offered and sold to Purchaser in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy of, and Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of Purchaser to acquire the Securities.

2.6 Governmental Review . Purchaser understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.

2.7 Rule 144 . Purchaser acknowledges that it is familiar with Rule 144, as amended, of the rules and regulations of the Securities and Exchange Commission, promulgated pursuant to the Securities Act (“ Rule 144 ”). Purchaser understands that except as provided in the Registration Rights Agreement: (i) the Securities have not been and are not being registered under the Securities Act or any state securities laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) Purchaser shall have delivered to the Company an opinion of counsel, in a generally acceptable form, to the effect that such Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration, or (C) Purchaser provides the Company with reasonable assurance that such Securities can be sold, assigned or transferred pursuant to Rule 144; (ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and further, if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other Person is under any obligation to register the Securities under the Securities Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.

2.8 Legends . Purchaser understands that, subject to ARTICLE V hereof, the certificates for the Warrant and, until such time as the Warrant Shares and Common Shares have been registered under the Securities Act as contemplated by the Registration Rights Agreement or otherwise may be sold by Purchaser pursuant to Rule 144 (subject to and in accordance with the procedures specified in ARTICLE V hereof), the certificates for the Common Shares and the

Warrant Shares will bear a restrictive legend (the “ Legend ”), which will include language in substantially the following form:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company represents and warrants to Purchaser as of the date hereof and as of the Closing that the following statements are true and correct, except as set forth on the disclosure schedules attached hereto as Schedule 3 (the “ Company Disclosure Schedules ”) and except as disclosed in the SEC Documents (as hereinafter defined).

3.1 Organization and Qualification . Each of the Company and its subsidiaries (i) is a corporation, limited liability company or limited partnership duly organized, validly existing and in good standing under the laws of the state or jurisdiction of its organization, (ii) has all requisite power and authority to conduct its business as now conducted and as currently contemplated and, in the case of the Company, to issue the Securities hereunder, and to execute and deliver each Transaction Document to which it is a party, and to contemplate the transactions contemplated thereby, and (iii) is duly qualified to do business and is in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary except where the failure to be so qualified could not reasonably be expected to result in a Material Adverse Effect. “ Material Adverse Effect ” means any change or event that has had or could reasonably be expected to have a material adverse effect on (i) the operations, business, assets, properties, or financial condition of (A) any Loan Party (other than the Inactive Subsidiaries), (B) any Subsidiary of any Loan Party that holds a Gaming License or otherwise has assets, revenues, operations or businesses that are material to any Loan Party, (C) the Loan Parties taken as a whole or (D) the Loan Parties and their Subsidiaries taken as a whole, (ii) the ability of any Loan Party to perform any of its obligations under any Loan Document to which it is a party, (iii) the legality, validity or enforceability of this Agreement or any other Loan Document, or (iv) the rights and remedies of Administrative Agent or any Lender under any Loan Document.

3.2 Authorization; Enforcement . (a) The Company has the requisite corporate power and authority to enter into and perform under the Transaction Documents, and to issue,

sell and perform its obligations with respect to the Securities in accordance with the terms hereof and thereof and in accordance with the terms and conditions of the Transaction Documents; (b) the execution, delivery and performance of the Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Initial Shares and the Warrant, and the reservation for issuance of the Additional Shares and the Warrant Shares) have been duly authorized by all necessary corporate action and no further consent or authorization of the Company, its board of directors, or its stockholders is required with respect to any of the transactions contemplated hereby or thereby (except for any action taken by the board of directors necessary in the future to carry out the purposes of the Transaction Documents); (c) this Agreement, the Registration Rights Agreement, the Initial Shares, and the Warrant have been duly executed and delivered by the Company; and (d) this Agreement, the Registration Rights Agreement and the Warrant constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, except (i) to the extent that such validity or enforceability may be subject to or affected by any bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally the enforcement of, creditors’ rights or remedies of creditors generally, or by other equitable principles of general application, and (ii) as rights to indemnity and contribution under the Registration Rights Agreement may be limited by federal or state securities laws. “ Person ” means any individual, sole proprietorship, partnership, limited liability company, joint venture, trust, unincorporated association, corporation, entity or government (whether federal, state, county, city or otherwise, including, without limitation, any instrumentality, division, agency or department thereof).

3.3 Capitalization . The authorized capital stock of the Company consists of (x) 100,000,000 shares of Common Stock, of which the number of shares issued and outstanding, shares reserved for issuance pursuant to the Company’s stock option, restricted stock and stock purchase plans and shares issuable and reserved for issuance pursuant to securities exercisable or exchangeable for, or convertible into, shares of Common Stock are set forth on Schedule 3.3 and (y) 5,000,000 shares of Preferred Stock, $0.10 par value of which 50,000 shares have been designated Series A Junior Participating Preferred Stock, and none of which are issued and outstanding. All of such outstanding or issuable shares have been, or upon issuance will be, validly issued and are fully paid and nonassessable. Except as disclosed in Schedule 3.3 , (i) no shares of the Company’s capital stock are subject to preemptive rights or any other similar rights or any Liens or encumbrances suffered or permitted by the Company; (ii) there is no outstanding Indebtedness of the Issuer nor are there any outstanding leasing or similar arrangements that, in connection with GAAP, consistently applied for the periods covered thereby, are classified as a capital lease; (iii) except for the Securities and the IGT Subordinated Debt and the warrants related thereto (and any registration rights related thereto), there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable for, any shares of capital stock of the Company or any of its subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable for, any shares of capital stock of the Company or any of its subsidiaries; (iv) except for the Registration Rights Agreement, there are no agreements or arrangements under which the Company or any of its subsidiaries is obligated to register the sale

of any of their securities under the Securities Act; (v) except for the IGT Subordinated Debt, there are no outstanding securities or instruments of the Company or any of its subsidiaries that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its subsidiaries is or may become bound to redeem a security of the Company or any of its subsidiaries; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Securities or the IGT Subordinated Debt and the warrants related thereto (and any registration rights related thereto); and (vii) the Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. The Company has furnished to the Purchaser true and correct copies of the Company’s Amended and Restated Articles of Incorporation, as amended and as in effect on the date hereof (the “Articles of Incorporation”). The Company has furnished to the Purchaser true and correct copies of the Company’s Bylaws, as amended and as in effect on the date hereof (the “Bylaws”). The Company has set forth on Schedule 3.3 hereof all instruments, certificates, documents and agreements (other than the Articles of Incorporation and By-laws) governing securities convertible into or exercisable or exchangeable for Common Stock of the Company (and the Company shall provide to Purchaser copies thereof upon the request of Purchaser).

3.4 Issuance of Securities . The Initial Shares to be issued and the Warrant to be granted at the Closing have been duly authorized by all necessary corporate action and the Initial Shares, when issued in accordance with the terms hereof, will be validly issued and outstanding, fully paid and nonassessable and free from all taxes, Liens and charges with respect to the issue thereof, with the holder being entitled to all rights accorded to a holder of Common Stock. The Additional Shares and the Warrant Shares have been duly authorized by all necessary corporate action, and when the Additional Shares (if any) and the Warrant Shares are issued in accordance with the terms of this Agreement and the Warrant, respectively, such shares will be validly issued and outstanding, fully paid and nonassessable and free from all taxes, Liens and charges with respect to the issue thereof, with the holder being entitled to all rights accorded to a holder of Common Stock. Assuming the accuracy of each of the representations and warranties set forth in ARTICLE II of this Agreement, the issuance by the Issuer of the Securities is exempt from registration under the Securities Act.

3.5 No Conflicts or Violations . Except as disclosed in Section 3.5 of the Company Disclosure Schedules, the execution and delivery and performance of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the reservation for issuance and issuance of the Securities) at the Closing will not (i) result in a violation of the Articles of Incorporation or By-laws; (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any material agreement, indenture or instrument to which the Company or any of its subsidiaries is a party; or (ii) assuming the accuracy of each of the representations and warranties set forth in ARTICLE II of this Agreement, result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and the rules and regulations of the Principal Market) applicable to the Company or any of its subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected. Except as disclosed in Section 3.5 of the Company Disclosure Schedules, neither the Company nor any of its subsidiaries is in violation of any term

of or in default under any contract, agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or order or any statute, rule or regulation applicable to the Company or its Subsidiaries, except where such violations or defaults would not result, either individually or in the aggregate, in a Material Adverse Effect. The business of the Company and its subsidiaries is not being conducted, and will not be conducted, in violation of any law, ordinance or regulation of any Governmental Authority, except where such violations would not result, either individually or in the aggregate, in a Material Adverse Effect. The Company and its subsidiaries are unaware of any facts or circumstances that might give rise to any of the foregoing. Neither the Issuer nor any of its officers or directors have violated Section 9(a) of the Exchange Act or any rules promulgated thereunder or analogous provisions of any applicable state securities or Blue Sky laws.

3.6 Nasdaq Compliance; Repurchase . The Company is not in violation of the listing requirements of The NASDAQ Stock Market, including, without limitation, the requirements set forth in Marketplace Rule 4350(i)(1)(D) and except as set forth on Schedule 3.6 , has no knowledge of any facts that would lead to delisting or suspension of the Common Stock by The NASDAQ Stock Market in the foreseeable future. The Company has not purchased any issued and outstanding shares of Common Stock on the open market or in privately negotiated transactions or otherwise during the two month period prior to the Effective Date. The Company’s application for an exception to the shareholder approval requirements contained in Section 4350(i)