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TABLE OF CONTENTS

Table of Contents


As Filed Pursuant to Rule 424(b)(3)
Registration No.# 333-203360

PROSPECTUS

SCIENTIFIC GAMES INTERNATIONAL, INC.

(as Issuer)

SCIENTIFIC GAMES CORPORATION

(as Guarantor)

Exchange Offer for
$350,000,000 6.625% Senior Subordinated Notes due 2021
$2,200,000,000 10.000% Senior Unsecured Notes due 2022

The Exchange Offer:

The New Notes:

         Please see "Risk Factors" beginning on page 20 of this prospectus for a discussion of certain factors that you should consider before participating in this exchange offer.

         Each broker-dealer that receives new notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such new notes as required by applicable securities laws and regulations. The letter of transmittal states that, by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act of 1933, as amended (the "Securities Act").

         This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of new notes received in exchange for old notes where such old notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of up to 180 days after the expiration of the exchange offer, we will make this prospectus available to any broker-dealer for use in connection with any such resale.

         None of the Securities and Exchange Commission, any state securities commission, the Nevada Gaming Commission, the Nevada State Gaming Control Board, the Mississippi Gaming Commission, the Louisiana Gaming Control Board, the Indiana Gaming Commission, the New Jersey Casino Control Commission or any other gaming authority or other regulatory agency has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

         The date of this prospectus is April 20, 2015.


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TABLE OF CONTENTS

INDUSTRY AND MARKET DATA

    ii  

BASIS OF PRESENTATION

    ii  

WHERE YOU CAN FIND MORE INFORMATION

    ii  

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

    ii  

INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

    iii  

SUMMARY

    1  

RATIO OF EARNINGS TO FIXED CHARGES

    19  

RISK FACTORS

    20  

USE OF PROCEEDS

    29  

CAPITALIZATION

    30  

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

    31  

THE EXCHANGE OFFER

    40  

SELECTED FINANCIAL DATA

    50  

DESCRIPTION OF OTHER INDEBTEDNESS

    52  

DESCRIPTION OF 2021 NEW NOTES

    59  

DESCRIPTION OF 2022 NEW NOTES

    113  

BOOK-ENTRY SETTLEMENT AND CLEARANCE

    170  

CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS RELATING TO THE EXCHANGE OF 2021 OLD NOTES FOR 2021 NEW NOTES

    173  

CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS RELATING TO THE EXCHANGE OF 2022 OLD NOTES FOR 2022 NEW NOTES AND THE OWNERSHIP AND DISPOSITION OF THE 2022 NEW NOTES

    175  

PLAN OF DISTRIBUTION AND SELLING RESTRICTIONS

    183  

LEGAL MATTERS

    184  

EXPERTS

    185  

        We have not authorized any dealer, salesperson or other person to give any information or represent anything to you other than the information contained in this prospectus. You must not rely on unauthorized information or representations.

        This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. The information in this prospectus is current only as of the date on its cover and may change after that date.

        This prospectus incorporates important business and financial information about us that is not included in or delivered with this document. You may obtain information incorporated by reference, at no cost, by writing or telephoning us at the following address:

Scientific Games Corporation
Attention: Investor Relations
6650 S. El Camino
Las Vegas, Nevada 89118
(702) 897-7150

        To obtain timely delivery, you must request the information no later than five (5) business days prior to the expiration of the exchange offer, or May 8, 2015. See "Where You Can Find More Information" and "Incorporation of Certain Documents by Reference" beginning on page ii.

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INDUSTRY AND MARKET DATA

        Certain market data and other statistical information included in this prospectus (including the documents incorporated by reference in this prospectus) are based on independent industry publications, government publications, reports by market research firms or other published independent sources. Some data is also based on our good faith estimates, which are derived from our review of internal surveys, as well as the independent sources listed above. Although we believe these sources are reliable, we have not independently verified the information and cannot guarantee its accuracy and completeness.


BASIS OF PRESENTATION

        Unless the context indicates otherwise, references in this prospectus to "Scientific Games International, Inc." and the "Issuer" refer to Scientific Games International, Inc., a Delaware corporation and the issuer of the new notes, and references to the "guarantors" refer to Scientific Games Corporation and its wholly owned domestic subsidiaries (other than the Issuer) that will guarantee the new notes. Unless the context indicates otherwise, references to "Scientific Games," "the Company," "we," "our," "ours" and "us" refer to Scientific Games Corporation and its consolidated subsidiaries, including the Issuer. In the discussion relating to our lottery business, "United States ("U.S.") jurisdictions" refer to the 50 states in the U.S. plus the District of Columbia and Puerto Rico.


WHERE YOU CAN FIND MORE INFORMATION

        The Issuer is not subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), pursuant to Rule 12h-5 under the Exchange Act. Scientific Games Corporation, however, is subject to the informational requirements of the Exchange Act and, accordingly, files annual, quarterly and current reports, proxy statements and other information with the United States Securities and Exchange Commission (the "SEC"). You may read and copy any document we file with the SEC at the SEC's public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room and its copy charges. Our SEC filings are also available to the public on the SEC's website at www.sec.gov.

        We have filed with the SEC a registration statement on Form S-4 under the Securities Act with respect to the exchange offer. This prospectus does not contain all of the information contained in the registration statement and the exhibits to the registration statement. Copies of our SEC filings, including the exhibits to the registration statement, are available through us or from the SEC through the SEC's website or at its facilities described above.


INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

        In this prospectus, we "incorporate by reference" certain information we file with the SEC (other than, in each case, documents or information deemed to have been furnished and not filed in accordance with the SEC rules), which means that we can disclose important information to you by referring to that information. The information incorporated by reference is considered to be an important part of this prospectus. We incorporate by reference in this prospectus the following documents filed with the SEC pursuant to the Exchange Act:

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        We also incorporate by reference any future filings made by us with the SEC (other than information furnished pursuant to Item 2.02 or Item 7.01 of Form 8-K or as otherwise permitted by the SEC's rules) under Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act on or after the date of this prospectus and prior to the termination of the offering, and any reoffering, of the securities offered hereby. Any statement in a document incorporated by reference in this prospectus will be deemed to be modified or superseded to the extent a statement contained in this prospectus or any other subsequently filed document that is incorporated by reference in this prospectus modifies or supersedes such statement. In addition, information contained in this prospectus shall be modified or superseded by information in any such subsequently filed documents that are incorporated by reference in this prospectus.

        References in this prospectus to this prospectus will be deemed to include the documents incorporated by reference, which are an integral part of this prospectus. You should obtain and review carefully copies of the documents incorporated by reference. Information that we file later with the SEC will automatically update the information incorporated by reference and the information in this prospectus. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.

        You may request a copy of these filings, at no cost, by writing or telephoning us at the address on page i of this prospectus. Exhibits to the filings will not be sent, however, unless those exhibits have been specifically incorporated by reference in this prospectus.


INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

        Some of the statements contained or incorporated by reference in this prospectus constitute "forward-looking statements." Forward-looking statements describe future expectations, plans, results or strategies and can often be identified by the use of terminology such as "may," "will," "estimate," "intend," "plan," "continue," "believe," "expect," "anticipate," "should," "could," "potential," "opportunity," "goal" or similar terminology. These statements are based upon management's current expectations, assumptions and estimates and are not guarantees of timing, future results or performance. Actual results may differ materially from those contemplated in these statements due to a variety of risks and uncertainties and other factors, including, among other things:

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        For a discussion of these and other factors that may affect our business, you should also read carefully the factors described in the "Risk Factors" section of this prospectus. Additional information regarding risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated in forward-looking statements is included from time to time in our filings with the SEC. Forward-looking statements speak only as of the date they are made and, except for our ongoing obligations under the U.S. federal securities laws, we undertake no obligation to publicly update any forward-looking statements whether as a result of new information, future events or otherwise.

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SUMMARY

        This is only a summary of the prospectus. You should read carefully the entire prospectus, including "Risk Factors," and our consolidated financial statements and related notes as well as the documents incorporated by reference in this prospectus, before making an investment decision.

Our Company

        We are a leading developer of technology based products and services and associated content for the worldwide gaming and lottery industries. Our portfolio includes gaming machines and game content, instant and draw based lottery games, server based gaming and lottery systems, casino management systems, table game products and services, sports betting technology, loyalty and rewards programs, and interactive gaming and lottery content and services. We also gain access to technologies and pursue global expansion through strategic acquisitions and equity investments. We report our operations in three business segments—Gaming, Lottery and Interactive.

        On November 21, 2014, the Company acquired Bally for $5.1 billion (including the refinancing of approximately $1.9 billion of existing Bally indebtedness), creating one of the largest and most diversified global gaming suppliers. See "—The Transactions."

Gaming segment

        The gaming industry is a large and dynamic worldwide marketplace characterized by the rapid development of new technologies, products and game content. Gaming products and services are used by a diverse group of gaming operators, including commercial and tribal casinos, riverboat casinos, horse and greyhound racetracks, bars, Jai Alai facilities, truck stops, night clubs, bingo and arcade halls, licensed betting offices, or LBOs, and similar venues. In addition, U.S. and international lotteries may offer video lottery terminals, or VLTs, and other forms of gaming, such as bingo and sports wagering.

        Our products are installed in all of the major regulated gaming jurisdictions in the U.S., as well as in approximately 146 international gaming jurisdictions. We believe the total installed base of gaming machines in North America is approximately 940,000 units and has been relatively stable in recent years. Growth of gaming in land-based venues is driven by the opening of new casinos in both new and existing jurisdictions and the expansion of existing casinos. In addition, the land-based gaming supply business is significantly impacted by the rate at which casinos and other gaming operators replace their gaming machines, which is dependent upon a number of factors, including their capital budgets. Virtually all sectors of the gaming industry are impacted by changes in economic conditions that impact players' disposable incomes.

        We completed our acquisition of Bally on November 21, 2014. We believe that the acquisition complements our existing gaming business by expanding our product offerings, extends our customer base, allows us to leverage the best technologies from both companies and provides operating scale. We believe that the acquisition enhances our leadership positions in our existing gaming machine and interactive gaming businesses, and elevates us to leadership positions in sectors of the gaming industry in which we have not historically had a presence, such as casino-management systems and a variety of table game products.

 

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        The following table summarizes the primary business activities and investments included in our Gaming business segment.

Gaming segment
Primary business activities   Equity investments

Supplying gaming machines, conversion kits, automatic card shufflers, roulette chip sorters and spare parts for all of our products to commercial, tribal and governmental gaming

 

RCN—29.4% equity interest in a provider of communications services to racing and non-racing customers

    operators

Leasing or otherwise providing gaming machines, automatic card shufflers, roulette chip sorters, server-based gaming systems and content and licensing proprietary table game content to commercial, tribal and governmental gaming operators

Selling casino-management technology solutions and systems to commercial, tribal and governmental gaming operators

Providing video lottery central monitoring and control systems and networks for gaming regulators

 

ITL—50% equity interest in an entity from which we lease gaming machines and provide them to our customers

Sportech—20% equity interest in an operator and supplier of sports pools and tote systems (equity interest sold on January 9, 2014)

Product sales

        Our product sales include the sale of gaming machines, table products and casino-management technology solutions and systems to commercial, tribal and government casino operators and wide-area gaming operators, as well as sales of VLTs, conversion kits (including game, hardware or operating system conversions), spare parts and game content.

 

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Services

        Our Gaming services revenue includes revenue earned from participation games, other gaming machine services and table product leasing and licensing. Participation games are gaming machines provided to customers through service or leasing arrangements in which our revenues are calculated based on: (1) a percentage of net win (i.e., the amount wagered, or coin-in, less payouts); (2) fixed daily fees; (3) a percentage of the coin-in; or (4) a combination of a fixed daily fee and a percentage of the coin-in. We categorize our participation gaming machines as (1) WAP, premium and daily fee participation games and (2) other leased and participation games.

 

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Lottery segment

        Lotteries are operated by U.S. and international governmental authorities and their licensees in approximately 180 jurisdictions throughout the world. Governments typically authorize lotteries as a means of generating revenues without imposing additional taxes. Net lottery proceeds are generally set aside for public purposes, such as education, aid to the elderly, conservation, transportation and economic development. Many jurisdictions have come to rely on the proceeds from lottery game sales as a significant source of funding for these programs. Although there are many types of lottery games worldwide, the two principal categories of products offered are draw lottery games and instant lottery games. Currently, 44 U.S. jurisdictions offer instant game lotteries and 46 U. S. jurisdictions offer draw lotteries.

        An instant lottery game is typically played by removing a scratch-off protective coating from a preprinted ticket to reveal if it is a winner. Draw lottery games, such as POWERBALL® and MEGA MILLIONS®, are based on a random selection of a series of numbers, and prizes are generally based on the number of winners who share the prize pool, although set prizes are also offered. Draw lottery games are generally provided through a lottery system in which lottery terminals in retail outlets are continuously connected to a central computer system for the activation, sale and validation of lottery games and related functions. A lottery system may also be used to validate instant lottery games to confirm that a ticket is a winner and prevent duplicate payments. In some jurisdictions, separate instant game validation systems may be installed.

        Lotteries may offer a range of other games. In the U.S., some lotteries offer high frequency games such as keno, which is typically played every four to five minutes in restricted social settings, such as bars, and is usually offered as an extension of the lottery system.

        Based on third party data, U.S. instant lottery game retail sales and draw lottery retail sales (which we define as retail sales of draw games, keno and instant games validated by the relevant system) totaled approximately $39 billion and approximately $49 billion, respectively, for the year ended December 31, 2014. Based on available published industry information, we estimate that worldwide instant lottery game retail sales and worldwide draw lottery retail sales totaled approximately $76 billion and approximately $199 billion, respectively, during fiscal year 2012.

 

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        The following table summarizes the primary business activities and equity investments included in the Lottery business segment.

Lottery segment
Primary business activities   Equity investments

Designing, printing and selling instant lottery games

Providing instant game-related services, such as game design, sales and marketing support and inventory management

Sublicensing brands for lottery products and providing lottery-related promotional products

Supplying player loyalty programs, merchandising services and interactive marketing campaigns

Providing lottery systems, including equipment, software, data communication services and support

Providing instant game validation systems

Providing software, hardware and related services for sports wagering and keno systems

Printing and selling phone cards

 

LNS—20% equity interest in Lotterie Nazionali S.r.l., the operator of the Gratta e Vinci instant ticket lottery in Italy

Northstar Illinois—20% equity interest in Northstar Lottery Group, LLC, the private manager of the Illinois lottery

Northstar New Jersey—17.69% equity interest in Northstar New Jersey Lottery Group, LLC, an entity that provides marketing and sales services to the New Jersey lottery

Hellenic Lotteries—16.5% equity interest in Hellenic Lotteries S.A., the operator of the Greek state lotteries

CSG—49% equity interest in Beijing CITIC Scientific Games Technology Co., Ltd., the instant game supplier to the China Sports Lottery

GLB—50% equity interest in Beijing Guard Libang Technology Co., Ltd, a provider of lottery systems and services for the China Welfare Lottery

        We believe we are the leading designer, manufacturer and distributor of instant lottery games in the world. We market instant lottery games and related services to U.S. and international lotteries and commercial customers. We supply instant lottery games to 39 of the 44 U.S. jurisdictions that sell instant lottery games and have sold instant lottery games to customers in approximately 50 countries. Our U.S. instant lottery game contracts typically have an initial term of three to five years and frequently include multiple renewal options for additional periods ranging from one to five years, which our customers have generally exercised in the past. We typically sell our instant lottery games on a price-per-unit or participation basis. Certain of our international customers purchase instant lottery games as needed rather than under multi-game supply contracts.

        Some of our contracts bundle the design and manufacturing of instant lottery games, instant game management systems and marketing and other services, such as the design and installation of game management software, inventory and distribution, sales, accounting, training and advisory services, market research and retailer training and recruitment. We are typically paid based on a percentage of retail sales under these contracts.

        We provide lotteries with access to some of the world's most popular entertainment brands on lottery products, which we believe helps increase our customers' instant game sales. Our licensed entertainment brands include AMC®—THE WALKING DEAD®, HARLEY-DAVIDSON®, LOTERIA®, MAJOR LEAGUE BASEBALL®, MARGARITAVILLE®, MONOPOLY, NATIONAL BASKETBALL ASSOCIATION®, THE PRICE IS RIGHT® and SLINGO®. We also provide branded merchandise, advertising, promotional support, drawing management services and prize fulfillment programs. In addition, we offer lotteries interactive marketing services through our Properties Plus® program, which

 

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features players clubs, reward programs, second chance promotional websites, interactive games and subscription systems that enable players to purchase lottery games securely over the internet.

        We believe we are a leading provider of lottery systems to lotteries in the U.S. and internationally. Our lottery systems use proprietary technology that facilitates high-speed processing of draw lottery game wagers as well as validation of winning draw and instant lottery games. Our lottery systems business includes the supply of proprietary transaction-processing software, draw lottery games, keno, point-of-sale terminals, central site computers and communication platforms as well as ongoing operational support and maintenance services. In the U.S., we typically place our lottery systems pursuant to long-term contracts that typically have an initial term of at least five years and under which we are generally paid a fee equal to a percentage of the lottery's total retail sales. Our U.S. contracts typically contain multiple renewal options that generally have been exercised by our customers in the past. Internationally, we typically sell point-of-sale terminals and/or computer software to lottery authorities and may provide ongoing fee-based systems and software support services.

        We have contracts to operate lottery systems for nine of the 46 U.S. jurisdictions that operate draw lotteries. In addition, we have a contract with the manager of the Indiana lottery to operate the lottery system in the state of Indiana. Internationally, we have lottery systems operating in Canada, China, France, Germany, Hungary, Iceland, Israel, Italy, Latvia, Mexico, Norway, the Philippines, Spain and Switzerland.

Interactive segment

        The rapidly evolving interactive gaming sector includes social (non-wagering) gaming and interactive real-money gaming, or RMG. Through the Interactive segment, we make available WMS, Bally and third-party branded content directly to players of social gaming or, in the case of RMG, directly to online casino operators. Similar to traditional land-based gaming, the appeal and performance of our game content is an important contributor to our success in the interactive gaming business. Our interactive gaming business is increasingly focused on products and services that operate on both mobile and desktop products and platforms.

        We provide interactive gaming products and services for both social gaming and RMG, available via desktop and mobile devices.

 
  Facebook   Apple® platform
(aka iOS)
  Android®
platform
  Kindle®
platform
  Microsoft's
Windows 8
 
JPSC     X     X     X     X     X  
GFC     X     X     X     X        
Dragonplay Slots     X     X     X           X  
Dragonplay Poker     X     X     X              
Live Hold'em Pro Poker     X     X     X              
Wild Bingo     X           X              

 

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        We believe that growth in our interactive gaming business is driven largely through new channels of distribution, such as the various types of mobile gaming platforms, the expansion of legal interactive RMG jurisdictions, the addition of social gaming products, such as our newest social game, GFC, which we launched in early 2014, the number and quality of our proprietary and third-party branded games released and available to players, the addition of traditional land-based casino operators and RMG operators that are not currently customers, the effectiveness of our marketing efforts designed to engage new players and re-engage existing players, and the prominence of our offerings on operators' websites, which is not controlled by us. Virtually all sectors of the interactive gaming industry are impacted by changes in economic conditions that impact players' disposable income.

The Issuer

        Scientific Games International, Inc., a Delaware corporation, is a direct wholly owned subsidiary of Scientific Games Corporation. The Issuer's principal executive offices are located at 1500 Bluegrass Lakes Parkway, Alpharetta, GA 30004, and its telephone number at that address is (770) 664-3700.

The Transactions

Bally Acquisition

        On November 21, 2014, Scientific Games Corporation acquired Bally for $83.30 in cash per common share, for a total enterprise value of approximately $5.1 billion, including the refinancing of approximately $1.9 billion of existing indebtedness of Bally. For further information regarding the Bally acquisition, see the full text of the Merger Agreement, a copy of which is filed as Exhibit 2.1 to Scientific Games Corporation's Current Report on Form 8-K filed with the SEC on August 4, 2014, and Scientific Games Corporation's Current Report on Form 8-K filed with the SEC on November 26, 2014.

The Financing Transactions

        Concurrently with the consummation of the Bally acquisition, we entered into the following financing transactions:

        For further information regarding the amended revolving credit facility and the new incremental term loan B2, please see Scientific Games Corporation's Current Report on Form 8-K filed with SEC on October 7, 2014 as well as the section entitled "Description of Other Indebtedness" in this prospectus. In this prospectus, we refer to the Issuer's credit agreement, dated as of October 18, 2013, as amended in connection with the financing transactions referred to above, as the "credit agreement." Scientific Games Corporation is a guarantor under the credit agreement.

 

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Organizational Structure

        The chart below summarizes and presents the simplified organizational structure of the Company following the transactions referred to above. It is intended solely to illustrate the general ownership structure following the transactions referred to above. Lower-tier subsidiaries are not shown.

GRAPHIC


(1)
Consists of $567.6 million revolving credit facility, $2,277.0 million of term B-1 loans and $2,000.0 million of term B-2 loans as of December 31, 2014.

 

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The Exchange Offer

        The following summary contains basic information about the exchange offer and the new notes. It does not contain all the information that is important to you. For a more complete understanding of the new notes, please refer to the sections of this prospectus entitled "The Exchange Offer," "Description of 2021 New Notes" and "Description of 2022 New Notes." For purposes of this summary and the descriptions of the notes included in this prospectus, references to the "Company" refer only to Scientific Games Corporation and do not include its subsidiaries and references to the "Issuer" refer only to Scientific Games International, Inc. and do not include its subsidiaries.

        On June 4, 2014, the Issuer issued $350.0 million in aggregate original principal amount of the 2021 old notes in a private offering to a group of initial purchasers in reliance on exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws. On November 21, 2014, SGMS Escrow Corp., a wholly owned subsidiary of the Issuer, issued $2,200 million in aggregate principal amount of the 2022 old notes in a private offering to a group of initial purchasers in reliance on exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws. Promptly following the Bally acquisition, on November 21, 2014, SGMS Escrow Corp. merged with and into the Issuer, with the Issuer continuing as the surviving corporation, and the Issuer assumed the obligations of SGMS Escrow Corp. under the 2022 old notes and the 2022 notes indenture.

The Exchange Offer

  The Issuer is offering to exchange an aggregate of $350.0 million principal amount of 2021 new notes for $350.0 million principal amount of 2021 old notes and an aggregate of $2,200.0 million principal amount of 2022 new notes for $2,200.0 million principal amount of 2022 old notes.

 

To exchange your old notes, you must properly tender them, and the Issuer must accept them. You may tender outstanding old notes only in denominations of the principal amount of $2,000 and integral multiples of $1,000 in excess thereof. The Issuer will exchange all old notes that you validly tender and do not validly withdraw. The Issuer will issue registered new notes promptly after the expiration of the exchange offer.

 

The form and terms of each series of new notes will be substantially identical to those of the applicable series of old notes except that the new notes will have been registered under the Securities Act. Therefore, each series of new notes will not be subject to certain contractual transfer restrictions, registration rights and certain additional interest provisions applicable to such series of old notes prior to consummation of the exchange offer.

Resale of New Notes

 

We believe that, if you are not a broker-dealer, you may offer new notes (together with the guarantees thereof) for resale, resell and otherwise transfer the new notes (and the related guarantees) without complying with the registration and prospectus delivery requirements of the Securities Act if you:

 

acquired the new notes in the ordinary course of business;

 

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are not engaged in, do not intend to engage in and have no arrangement or understanding with any person to participate in a "distribution" (as defined under the Securities Act) of the new notes; and

 

are not an "affiliate" (as defined under Rule 405 of the Securities Act) of the Issuer or any guarantor.

 

If any of these conditions are not satisfied, you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. Our belief that transfers of new notes would be permitted without registration or prospectus delivery under the conditions described above is based on the interpretations of the SEC given to other, unrelated issuers in transactions similar to the exchange offer. We cannot assure you that the SEC would take the same position with respect to the exchange offer.

 

Each broker-dealer that receives new notes for its own account in exchange for old notes, where the old notes were acquired by it as a result of market-making activities or other trading activities, may be deemed to be an "underwriter" within the meaning of the Securities Act and must acknowledge that it will deliver a prospectus that meets the requirements of the Securities Act in connection with any resale of the new notes. However, by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act.

Expiration Date

 

The exchange offer will expire at 11:59 p.m., New York City time, on May 15, 2015 unless we extend it.

Withdrawal

 

You may withdraw your tender of old notes under the exchange offer at any time before the exchange offer expires. Any withdrawal must be in accordance with the procedures described in "The Exchange Offer—Withdrawal Rights."

Procedures for Tendering Old Notes

 

Each holder of old notes that wishes to tender old notes for new notes pursuant to the exchange offer must, before the exchange offer expires, either:

 

transmit a properly completed and duly executed letter of transmittal, together with all other documents required by the letter of transmittal, including the old notes, to the exchange agent, or

 

if old notes are tendered in accordance with book-entry procedures, arrange with The Depository Trust Company ("DTC"), to cause to be transmitted to the exchange agent an agent's message indicating, among other things, the holder's agreement to be bound by the letter of transmittal, or comply with the procedures described below under "—Guaranteed Delivery."

 

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A holder of old notes that tenders old notes in the exchange offer must represent, among other things, that:

 

the holder is not an "affiliate" of the Issuer or any guarantor as defined under Rule 405 of the Securities Act;

 

the holder is acquiring the new notes in its ordinary course of business;

 

the holder is not engaged in, does not intend to engage in and has no arrangement or understanding with any person to participate in a distribution of the new notes within the meaning of the Securities Act;

 

if the holder is a broker-dealer that will receive new notes for its own account in exchange for old notes that were acquired as a result of market-making or other trading activities, then the holder will deliver a prospectus in connection with any resale of the new notes; and

 

the holder is not acting on behalf of any person who could not truthfully make the foregoing representations.

 

Do not send letters of transmittal, certificates representing old notes or other documents to us or DTC. Send these documents only to the exchange agent at the address given in this prospectus and in the letter of transmittal.

Special Procedures for Tenders by Beneficial Owners of Old Notes

 

If

 

you beneficially own old notes,

 

those old notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee or custodian, and

 

you wish to tender your old notes in the exchange offer,

 

you should contact the registered holder as soon as possible and instruct it to tender the old notes on your behalf and comply with the instructions set forth in this prospectus and the letter of transmittal.

Guaranteed Delivery

 

If you hold old notes in certificated form or if you own old notes in the form of a book-entry interest in a global note deposited with the trustee, as custodian for DTC, and you wish to tender those old notes but

 

the certificates for your old notes are not immediately available or all required documents are unlikely to reach the exchange agent before the exchange offer expires, or

 

you cannot complete the procedure for book-entry transfer on time,

 

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then you may tender your old notes in accordance with the procedures described in "The Exchange Offer—Procedures for Tendering Old Notes—Guaranteed Delivery."

Consequences of Not Exchanging Old Notes

 

If you do not tender your old notes or we reject your tender, your old notes will remain outstanding and will continue to be subject to the provisions in the applicable indenture regarding the transfer and exchange of the old notes and the existing restrictions on transfer set forth in the legends on the old notes. In general, the old notes may not be offered or sold unless registered under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. Holders of old notes will not be entitled to any further registration rights under the applicable registration rights agreement. We do not currently plan to register the old notes under the Securities Act after the exchange offer.

 

You do not have any appraisal or dissenters' rights in connection with the exchange offer.

Certain U.S. Federal Income Tax Considerations

 

Your exchange of old notes for new notes will not be treated as a taxable exchange for U.S. federal income tax purposes. See "Certain U.S. Federal Income Tax Considerations Relating to the Exchange of 2021 Old Notes for 2021 New Notes" and "Certain U.S. Federal Income Tax Considerations Relating to the Exchange of 2022 Old Notes for 2022 New Notes and the Ownership and Disposition of the 2022 New Notes".

Conditions to the Exchange Offer

 

The exchange offer is subject to the conditions that it not violate applicable law or any applicable interpretation of the staff of the SEC. The exchange offer is not conditioned upon any minimum principal amount of old notes being tendered for exchange.

Use of Proceeds

 

Neither the Issuer nor Scientific Games Corporation will receive any cash proceeds from the exchange offer.

Acceptance of Old Notes and Delivery of New Notes

 

Subject to the satisfaction or waiver of the conditions to the exchange offer, we will accept for exchange any and all old notes properly tendered prior to the expiration of the exchange offer. We will complete the exchange offer and issue the new notes promptly after the expiration of the exchange offer.

Exchange Agent

 

Deutsche Bank Trust Company Americas is serving as exchange agent for the exchange offer. The address and the facsimile and telephone numbers of the exchange agent are provided in this prospectus under "The Exchange Offer—Exchange Agent" and in the letter of transmittal.

 

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The New Notes

        The exchange offer applies to the $350.0 million principal amount of 2021 old notes outstanding as of the date hereof and to the $2,200.0 million principal amount of 2022 old notes outstanding as of the date hereof. The form and the terms of each series of new notes will be identical in all material respects to the form and the terms of the applicable series of old notes except that the new notes:

        The 2021 new notes and 2022 new notes evidence the same debt as the 2021 old notes and 2022 old notes, respectively, exchanged for the 2021 new notes and 2022 new notes, respectively, and will be entitled to the benefits of the same indenture under which such old notes were issued, each of which is governed by New York law.

Issuer   Scientific Games International, Inc., a Delaware corporation and a direct wholly owned subsidiary of Scientific Games Corporation.

Securities Offered

 

 

2021 new notes

 

$350.0 million in principal amount of 6.625% senior subordinated notes due 2021.

2022 new notes

 

$2,200 million in principal amount of 10.000% senior unsecured notes due 2022.


Maturity Date

 

 

2021 new notes

 

May 15, 2021

2022 new notes

 

December 1, 2022


Interest Payment Dates

 

 

2021 new notes

 

May 15 and November 15 of each year, commencing November 15, 2014. Interest will accrue from the most recent date to which interest has been paid, or if no interest has been paid, from June 4, 2014.

2022 new notes

 

June 1 and December 1 of each year, commencing June 1, 2015. Interest will accrue from the most recent date to which interest has been paid, or if no interest has been paid, from November 21, 2014.


Optional Redemption

 

 

 

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2021 new notes

 

The Issuer may redeem some or all of the 2021 new notes at any time prior to May 15, 2017 at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest, if any, to the date of redemption plus a "make-whole" premium. See "Description of 2021 New Notes—Redemption—Redemption at Make-Whole Premium." The Issuer may redeem some or all of the 2021 new notes on or after May 15, 2017 at the redemption prices listed under "Description of 2021 New Notes—Redemption—Optional Redemption," plus accrued and unpaid interest, if any, to the date of redemption.


 

 

At any time prior to May 15, 2017, the Issuer may redeem up to 35% of the initially outstanding aggregate principal amount of the 2021 new notes at a redemption price of 106.625% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of redemption, so long as such aggregate principal amount does not exceed the amount of net cash proceeds received by, or contributed to the capital of, Scientific Games Corporation from one or more equity financings. See "Description of 2021 New Notes—Redemption—Optional Redemption Upon Equity Offering."

2022 new notes

 

The Issuer may redeem some or all of the 2022 new notes at any time prior to December 1, 2018 at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest, if any, to the date of redemption plus a "make-whole" premium. See "Description of 2022 New Notes—Redemption—Redemption at Make-Whole Premium." The Issuer may redeem some or all of the 2022 new notes on or after December 1, 2018 at the redemption prices listed under "Description of 2022 New Notes—Redemption—Optional Redemption," plus accrued and unpaid interest, if any, to the date of redemption.


 

 

At any time on or prior to December 1, 2017, the Issuer may redeem up to 35% of the initially outstanding aggregate principal amount of the 2022 new notes at a redemption price of 110% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of redemption, so long as such aggregate principal amount does not exceed the amount of net cash proceeds received by, or contributed to the capital of, Scientific Games Corporation from one or more equity financings. See "Description of 2022 New Notes—Redemption—Optional Redemption Upon Equity Offering."

Ranking

 

 

2021 new notes

 

The 2021 new notes will be the Issuer's senior unsecured subordinated obligations and will rank:

 

junior in right of payment to all of the Issuer's existing and future senior indebtedness, including its indebtedness under the credit agreement, the secured notes and the 2022 new notes;

 

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equal in right of payment with the Issuer's existing and future senior subordinated indebtedness, including its 6.250% senior subordinated notes due 2020 (the "2020 notes"), and the Issuer's guarantee of the 8.125% senior subordinated notes due 2018 issued by the Company (the "2018 notes");

 

senior in right of payment to any of the Issuer's future indebtedness that is expressly subordinated in right of payment to the 2021 new notes; and

 

structurally junior in right of payment to all of the liabilities of any of the Company's other subsidiaries that do not guarantee the 2021 new notes.


 

 

Similarly, the guarantee of each guarantor of the 2021 new notes will rank:

 

junior in right of payment to all of such guarantor's existing and future senior indebtedness, including its guarantee of the Issuer's indebtedness under the credit agreement, the secured notes and the 2022 new notes;

 

equal in right of payment with existing and future senior subordinated indebtedness of such guarantor, including, in the case of the Company, the 2018 notes and its guarantee of the 2020 notes and, in the case of each of the other guarantors, its guarantees of the 2018 notes and the 2020 notes;

 

senior in right of payment to any future indebtedness of such guarantor that is expressly subordinated in right of payment to its guarantee of the 2021 new notes; and

 

structurally junior in right of payment to all of the liabilities of any subsidiary of such guarantor if that subsidiary does not guarantee the 2021 new notes.

2022 new notes

 

The 2022 new notes will be the Issuer's senior unsecured obligations and will rank:

 

effectively subordinated to any of the Issuer's existing and future secured indebtedness, including the indebtedness under the credit agreement and the secured notes, to the extent of the value of the assets securing such indebtedness;

 

pari passu in right of payment to any of the Issuer's existing and future senior indebtedness, including the indebtedness under the credit agreement and the secured notes;

 

senior in right of payment to any of the Issuer's existing and future indebtedness that is expressly subordinated in right of payment to the 2022 new notes, including the Issuer's 2020 notes and 2021 new notes and the Issuer's guarantee of the 2018 notes; and

 

effectively subordinated to all of the liabilities of existing and future subsidiaries of the Company that do not guarantee the 2022 new notes.

 

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    Similarly, the guarantee of each guarantor of the 2022 new notes will rank:

 

effectively subordinated in right of payment to any of the existing and future secured indebtedness of such guarantor, including its guarantees of indebtedness under the credit agreement and the secured notes, to the extent of the value of its assets securing such indebtedness;

 

pari passu in right of payment to any of the existing and future senior indebtedness of such guarantor, including its guarantees of indebtedness under of the credit agreement and the secured notes;

 

senior in right of payment to any existing and future indebtedness of such guarantor that is expressly subordinated in right of payment to its guarantee of the 2022 new notes, including such guarantor's guarantee of the 2018 notes, the 2020 notes and the 2021 new notes (or, in the case of the Company, its 2018 notes and its guarantee of the 2020 notes and the 2021 new notes); and

 

effectively subordinated to all of the liabilities of existing and future subsidiaries of the Company that do not guarantee the 2022 new notes.


 

 

As of December 31, 2014:

 

the Issuer's and the guarantors' secured indebtedness was approximately $5,412.0 million (which excludes capital lease obligations of $35.3 million), comprised of indebtedness under the credit agreement (which excludes approximately $41.0 million of outstanding letters of credit) and the secured notes, and the Issuer had approximately $341.6 million of additional availability under the Credit Agreement (all of which would secured);

 

the senior unsecured indebtedness of the Issuer and the guarantors was approximately $2,397.6 million, consisting of the 2022 old notes and $197.6 million of outstanding surety or performance bonds;

 

the Issuer and the guarantors had approximately $900.0 million of senior subordinated indebtedness outstanding, consisting of the 2018 notes, the 2020 notes and the 2021 old notes (or guarantees thereof); and

 

our subsidiaries that are not guaranteeing the notes had outstanding total third-party liabilities of approximately $272.2 million, including trade payables.


Regulatory Redemption

 

The notes are subject to redemption requirements relating to gaming laws and regulations of gaming authorities in jurisdictions in which we conduct business. See "Description of the 2021 New Notes—Redemption—Regulatory Redemption" and "Description of 2022 New Notes—Redemption—Regulatory Redemption."

 

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Change of Control   Upon the occurrence of a change of control (or, in the case of the 2021 new notes, a change of control repurchase event), the Issuer will be required to offer to repurchase the notes at a price equal to 101% of the principal amount, plus accrued and unpaid interest to the purchase date. See "Description of 2021 New Notes—Change of Control" and "Description of 2022 New Notes—Change of Control."

Certain Covenants

 

The indentures governing the new notes contain certain covenants which will, among other things, limit our ability and the ability of our restricted subsidiaries to:

 

incur indebtedness or issue preferred stock;

 

pay dividends or make distributions in respect of capital stock or make certain other restricted payments or investments;

 

incur liens;

 

sell assets, including capital stock of our restricted subsidiaries;

 

agree to payment restrictions affecting restricted subsidiaries;

 

enter into transactions with our affiliates; and

 

merge, consolidate or sell substantially all of the Company's or the Issuer's assets.


 

 

These covenants are subject to important exceptions and qualifications. See "Description of 2021 New Notes—Covenants" and "Description of 2022 New Notes—Covenants."

No Public Market

 

The new notes are new securities and there is currently no established trading market for the new notes. The initial purchasers of the old notes have advised us that they presently intend to make a market in the new notes. However, you should be aware that they are not obligated to make a market in the new notes and may discontinue their market-making activities at any time without notice. As a result, a liquid market for the new notes may not be available if you try to sell your new notes. We do not intend to apply for a listing of the new notes on any securities exchange or any automated quotation system.

Use of Proceeds

 

Neither the Issuer nor Scientific Games Corporation will receive any cash proceeds from the exchange offer. See "Use of Proceeds."

Risk Factors

 

Investment in the notes involves certain risks. You should carefully consider the information under "Risk Factors" and all other information included or incorporated by reference in this prospectus before investing in the notes.

 

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RATIO OF EARNINGS TO FIXED CHARGES

        The following table presents our ratio of earnings to fixed charges for the years ended December 31, 2010, 2011, 2012, 2013 and 2014. For the purpose of determining the ratio of earnings to fixed charges, "earnings" consist of earnings (loss) before income tax expense (benefit) excluding earnings from equity method investments, plus fixed charges, and "fixed charges" consist of interest expense, including amortization of deferred financing costs, plus one-third of rental expense (this portion is considered to be representative of the interest factor). Earnings before fixed charges were inadequate to cover total fixed charges by $19.8 million, $37.6 million, $124.0 million, and $478.6 million for the years ended 2010, 2012, 2013, and 2014, respectively.

 
  Year ended December 31,
 
  2010
  2011
  2012
  2013
  2014

Ratio of earnings to fixed charges

  0.8   1.1   0.6     (0.5)x

 

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RISK FACTORS

        Before making any decision to participate in the exchange offer, you should carefully consider the following risk factors in addition to the other information contained in this prospectus and incorporated by reference in this prospectus. In particular, you should refer to the information under "Risk Factors" included in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2014, which is incorporated herein by reference.

        In addition to the risk factors relating to our business, the industries in which we operate and other matters included in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2014, you should carefully consider the following risk factors related to the notes, which, except as otherwise indicated, are generally applicable to the old notes as well as the new notes. Any of these risks could materially and adversely affect our business, results of operations, cash flows or financial condition. The risks described below and incorporated by reference herein are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, results of operations, cash flows or financial condition. In the following discussion of risk factors, when we refer to the term "note" or "notes," we are referring to both the old notes and the new notes to be issued in the exchange offer.

Risk Factors Relating to the Notes

Our level of indebtedness could adversely affect our results of operations, cash flows and financial condition.

        As of December 31, 2014, we had total indebtedness of $8,512.0 million (excluding approximately $41.0 million of outstanding letters of credit, $197.6 million of outstanding surety bonds and $35.3 million of capital lease obligations), consisting of borrowings under our credit agreement, the secured notes, the 2022 old notes, the 2021 old notes, the 2020 notes and the 2018 notes. Our debt service obligations could have an adverse impact on our results of operations, cash flow and financial condition for as long as the indebtedness is outstanding.

        Our level of indebtedness could affect our ability to obtain financing or refinance existing indebtedness; require us to dedicate a significant portion of our cash flow from operations to interest and principal payments on our indebtedness, thereby reducing the availability of cash flow to fund working capital, capital expenditures and other general corporate purposes; increase our vulnerability to adverse general economic, industry or competitive developments or conditions; and limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate or in pursuing our strategic objectives. In addition, we are exposed to the risk of higher interest rates as a significant portion of our borrowings are at variable rates of interest. If interest rates increase, the interest payment obligations under our non-hedged variable rate indebtedness would increase even if the amount borrowed remained the same and our results of operations, cash flows and financial condition would be negatively impacted. All of these factors could place us at a competitive disadvantage compared to competitors that may have less debt than we do. We may incur substantially more debt, including secured debt, or take other actions which may affect our ability to satisfy our obligations under the notes and our other indebtedness.

        The credit agreement and the indentures governing the secured notes, the notes, the 2020 notes and the 2018 notes will allow us to incur significant additional indebtedness in the future, including secured debt. For example, as of December 31, 2014, there was $341.6 million of additional availability under the revolving credit facility under our credit agreement. If we add new debt to our current debt levels, the related risks that we now face could intensify, making it less likely that we will be able to fulfill our obligations to holders of the notes. The terms of the indentures governing the notes permit us to incur substantial additional debt and will allow us to issue additional secured debt under certain circumstances, which would also be guaranteed by the guarantors and would share in the collateral that secure our indebtedness under the credit agreement and the secured notes (and the guarantees

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thereof). The indentures will also allow our foreign subsidiaries to incur additional debt, which would be structurally senior to the notes. In addition, the indentures will not prevent us from incurring other liabilities that do not constitute indebtedness. See "Description of 2021 New Notes" and "Description of 2022 New Notes."

Under the indentures that govern the notes, we would have had the capacity to make certain payments, including dividends.

        The indentures that govern the notes limit our ability to make certain payments, including dividends or distributions in respect of shares of our capital stock, the purchase, redemption, or retirement of any equity interests, and restricted investments. However, these limitations are subject to a number of exceptions, including certain exceptions based on a calculation of our net income, equity issuances, receipt of distributions and returns of capital with respect to certain investments. Accordingly, we will have had the capacity to make certain restricted payments (a portion of which is available only upon achievement of a minimum fixed charge coverage test) under the indentures (in addition to certain permitted investments). See "Description of 2021 New Notes—Covenants—Limitation on Restricted Payments" and "Description of 2022 New Notes—Covenants—Limitation on Restricted Payments."

We may not have sufficient cash flows from operating activities, cash on hand and available borrowings under the Credit Agreement to finance required capital expenditures under new contracts, service our indebtedness and meet our other cash needs and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful. These obligations require a significant amount of cash.

        Our gaming participation and lottery systems businesses generally require significant upfront capital expenditures for gaming machine or lottery terminal assembly, software customization and implementation, systems and equipment installation and telecommunications configuration. In connection with a renewal or bid of a gaming machine or lottery systems contract, a customer may seek to obtain new equipment or impose new service requirements, which may require additional capital expenditures in order to retain or win the contract. Historically, we have funded these upfront costs through cash flows generated from operations, available cash on hand and borrowings. Our ability to generate revenue and to continue to procure new contracts will depend on, among other things, our then present liquidity levels or our ability to obtain additional financing on commercially reasonable terms.

        If we do not have adequate liquidity or are unable to obtain financing for these upfront costs on favorable terms or at all, we may not be able to bid on certain contracts, which could restrict our ability to grow and have a material adverse effect on our results of operations, cash flows and financial condition. Moreover, we may not realize the return on investment that we anticipate on new or renewed contracts due to a variety of factors, including lower than anticipated retail sales or amounts wagered, higher than anticipated capital or operating expenses and unanticipated regulatory developments or litigation. We may not have adequate liquidity to pursue other aspects of our strategy, including bringing our products and services to new customers or new or underpenetrated geographies (including through equity investments) or pursuing strategic acquisitions.

        Our ability to make payments on and to refinance our indebtedness will depend on our ability to generate cash in the future. This, to some extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. Our lenders, including the lenders participating in our revolving credit facilities under the credit agreement, may become insolvent or tighten their lending standards, which could make it more difficult for us to borrow under our revolving credit facilities or to obtain other financing on favorable terms or at all. Our results of operations, cash flow and financial condition would be adversely affected if we were unable to draw funds under our revolving credit facilities because of a lender default or to obtain other cost-effective financing. Any

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default by a lender in its obligation to fund its commitment under our revolving credit facilities (or its participation in letters of credit) could limit our liquidity to the extent of the defaulting lender's commitment. If we are unable to generate sufficient cash flow in the future to meet our commitments, we will be required to adopt one or more alternatives, such as refinancing or restructuring our indebtedness, selling material assets or operations or seeking to raise additional debt or equity capital. We cannot assure you that any of these actions could be completed on a timely basis or on satisfactory terms or at all, or that these actions would enable us to continue to satisfy our capital requirements. Moreover, our existing debt agreements contain, and our future debt agreements may contain, restrictive covenants that may prohibit us from adopting these alternatives. Our failure to comply with these covenants could result in an event of default which, if not cured or waived, could result in the acceleration of all of our debt. See "Description of Other Indebtedness," "Description of 2021 New Notes" and "Description of 2022 New Notes."

The agreements governing our debt, including the notes, contain various covenants that impose restrictions on us that may affect our ability to operate our business and to make payments on the notes and our other indebtedness.

        Agreements governing our indebtedness, including the indentures (and the indentures governing the secured notes, the 2020 notes and the 2018 notes) and the credit agreement, impose, and future financing agreements are likely to impose, operating and financial restrictions on our activities which may adversely affect our ability to finance future operations or capital needs or to engage in new business activities. In some cases, these restrictions require us to comply with or maintain certain financial tests and ratios. Subject to certain exceptions, our Credit Agreement and/or indentures restrict our ability to, among other things:

        In addition, our credit agreement requires us to maintain a maximum consolidated net first lien leverage ratio on a quarterly basis. As a result of these covenants, we are limited in the manner in which we can conduct our business, and may be unable to engage in favorable business activities or finance future operations or capital needs. See "Description of Other Indebtedness," "Description of 2021 New Notes" and "Description of 2022 New Notes."

        Various risks, uncertainties and events beyond our control could affect our ability to comply with these covenants. Failure to comply with any of the covenants in our existing or future financing agreements could result in a default under those agreements and under other agreements containing cross-default provisions. Such a default would permit lenders to accelerate the maturity of the debt

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under these agreements and to foreclose upon any collateral securing the debt. Under these circumstances, we might not have sufficient funds or other resources to satisfy all of our obligations, including our obligations under the indentures. In addition, the limitations imposed by financing agreements on our ability to incur additional debt and to take other actions might significantly impair our ability to obtain other financing.

        We cannot assure you that we will be granted waivers or amendments to these agreements if for any reason we are unable to comply with these agreements or that we will be able to refinance our debt on terms acceptable to us, or at all.

Our credit ratings may not reflect the risks of investing in the notes.

        Our credit ratings are an assessment by rating agencies of our ability to pay our debts when due and include many subjective factors. Consequently, real or anticipated changes in our credit ratings will generally affect the value of the notes. Also, these credit ratings may not reflect the potential impact of risks relating to structure or marketing of the notes. Agency ratings are not a recommendation to buy, sell or hold any security and may be revised or withdrawn at any time by the issuing organization. Each agency's rating should be evaluated independently of any other agency's rating. There can be no assurance that our credit ratings will remain in effect for any given period of time or that such ratings will not be lowered, suspended or withdrawn entirely by a rating agency, if, in that rating agency's judgment, circumstances so warrant. There can also be no assurance that our credit ratings will reflect all of the factors that would be important to holders of the notes. Actual or anticipated changes or downgrades in our credit ratings, including any announcement that our ratings are under further review for a downgrade, could affect the value of the notes, may increase our borrowing costs and may negatively impact our ability to incur additional debt.

The Issuer will rely in part on its subsidiaries and the other subsidiaries of the Company for funds necessary to meet its financial obligations, including the notes and our other indebtedness.

        We conduct a significant portion of our activities through subsidiaries other than the Issuer. The Issuer will depend in part on those subsidiaries for dividends and other payments to generate the funds necessary to meet its financial obligations, including the payment of principal and interest on the notes. We cannot assure you that the earnings from, or other available assets of, these operating subsidiaries, together with the Issuer's operations, will be sufficient to enable the Issuer to pay principal or interest on the notes when due.

        Federal and state fraudulent transfer and conveyance statutes and similar laws may permit courts, under specific circumstances, to avoid the notes, the guarantees and/or security interests related to the secured notes, to require noteholders to return payments received from us or the guarantors, and to take other actions detrimental to the noteholders.

        Federal and state fraudulent transfer and conveyance statutes may apply to the issuance of the notes and the delivery of any guarantees of the notes, including the guarantees by the guarantors entered into upon issuance of the notes and guarantees (if any) that may be entered into thereafter under the terms of the indentures. Under federal bankruptcy law and comparable provisions of state fraudulent transfer or conveyance laws, which may vary from state to state, the issuance of the notes and the delivery of guarantees could be avoided as fraudulent transfers or conveyances if a court determined that the Issuer, at the time it issued the notes, or any of the guarantors, at the time it delivered the applicable guarantee (or, in some jurisdictions, at the time payment became due under the notes or a guarantee thereof):

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In addition, any payment by the debtor or guarantor under the notes or guarantee of the notes could be voided and required to be returned to the debtor or guarantor, as the case may be, or deposited in a fund for the benefit of the creditors of the debtor or guarantor.

        A court would likely find that a guarantor did not receive reasonably equivalent value or fair consideration for such guarantee if such guarantor did not substantially benefit directly or indirectly from the issuance of the notes and/or such guarantee. The measures of insolvency for purposes of these fraudulent transfer laws vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred such that we cannot be certain as to the standards a court would use to determine whether the Issuer or a guarantor was solvent at the relevant time which, if applicable in a particular jurisdiction, may be when payment became due under the notes or a guarantee. Regardless of the actual standard applied by the court, we cannot be certain that the issuance of the notes or a guarantee would not be avoided. The measure of insolvency for purposes of these fraudulent transfer laws will vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally, however, a debtor or a guarantor would be considered insolvent if:

        To the extent that a court avoids or otherwise finds unenforceable for any other reason the notes or a guarantee, your claims against the Issuer or the relevant guarantor would be eliminated or limited. In addition, the court might direct you to repay any amounts already received from the Issuer or such guarantor. Further, the avoidance of the notes or a related guarantee could result in an event of default with respect to our other debt that, in turn, could result in acceleration of such debt.

        In certain circumstances, a court may subordinate claims in respect of the notes or a guarantee to all other debts of an Issuer or a guarantor, or take other actions detrimental to the noteholders, based on equitable or other grounds. We cannot be certain as to the standards that a court might apply and whether it might find such subordination or other actions appropriate.

        Each guarantee contains a provision intended to limit the guarantor's liability to the maximum amount that it could incur without causing the incurrence of obligations under its guarantee to be a fraudulent transfer. This provision may not be effective to protect the guarantees from being voided under fraudulent transfer law or may reduce or eliminate the guarantor's obligation to an amount that effectively makes the guarantee worthless. For example, in 2009, the U.S. Bankruptcy Court in the Southern District of Florida in Official Committee of Unsecured Creditors of TOUSA, Inc. v. Citicorp N. Am., Inc. (which was reinstated on other grounds by the United States Court of

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Appeals for the Eleventh Circuit) found a savings clause provision in that case to be ineffective and held the guarantees at issue in that case to be fraudulent transfers and voided them in their entirety.

        Even if the guarantees of the notes remain in force, the remaining amount due and collectible under the guarantee may not be sufficient to pay the notes in full when due.

Because each guarantor's liability under its guarantee may be reduced to zero, avoided or released under certain circumstances, you may not receive any payments from some or all of the guarantors.

        Holders of notes will have the benefit of the guarantees of certain of our domestic restricted subsidiaries. The guarantees, however, are limited to the maximum amount that the guarantors are permitted to guarantee under applicable law. In addition, guarantees provided after the issue date of the notes may be especially subject to challenge as an avoidable preference under certain circumstances. As a result, a guarantor's liability under its guarantee could be reduced to zero, depending on (among other things) the amount of other obligations of such guarantor. Furthermore, under the circumstances discussed more fully above, a court under applicable fraudulent conveyance and transfer statutes could void the obligations under a guarantee or further subordinate it to all other obligations of the guarantor.

        As a result, a guarantor's liability under its guarantee could be materially reduced or eliminated depending upon the amounts of its other obligations and upon applicable laws. In particular, in certain jurisdictions, a guarantee issued by a company that is not in the company's corporate interests, the burden of which exceeds the benefit to the company or which is entered into within a certain period prior to insolvency or bankruptcy, may not be valid and enforceable. It is possible that a guarantor, a creditor of a guarantor or the insolvency administrator in the case of an insolvency of a guarantor may contest the validity and enforceability of the guarantee and that the applicable court may determine the guarantee should be limited or voided. In the event that any guarantees are deemed invalid or unenforceable, in whole or in part, or to the extent that agreed limitations on the guarantee obligation apply, the notes would be structurally subordinated to all liabilities of the applicable guarantor.

The notes will be structurally subordinated to the obligations of the Company's non-guarantor subsidiaries. Your right to receive payment on the notes could be adversely affected if any of our non-guarantor subsidiaries declares bankruptcy, liquidates or reorganizes.

        Some but not all of the Company's subsidiaries guarantee the notes. The Company's foreign subsidiaries are not guarantors of the notes. Furthermore, a subsidiary guarantee of the notes may be released under the circumstances described under "Description of 2021 New Notes—Guarantees" and "Description of 2022 New Notes—Guarantees." The Issuer's obligations under the notes and the guarantors' obligations under the guarantees are structurally subordinated to the obligations of our non-guarantor subsidiaries (or to those of any subsidiary whose guarantee is voided as provided above). Holders of notes will not have any claim as a creditor against the Company's subsidiaries that are not guarantors of the notes. Therefore, in the event of any bankruptcy, liquidation or reorganization of a non-guarantor subsidiary, the rights of the holders of notes to participate in the assets of such non guarantor subsidiary will rank behind the claims of that subsidiary's creditors, including trade creditors (except to the extent we have a claim as a creditor of such subsidiary) and preferred stockholders of such subsidiaries, if any. For the year ended December 31, 2014, the Company's non-guarantor subsidiaries had operating revenue of $629.0 million and operating income of $41.4 million. As of December 31, 2014, the Company's non-guarantor subsidiaries represented approximately 20.4% of our total assets.

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Your right to receive payments on the 2021 old notes and the 2021 new notes is subordinated to the Issuer's senior debt and the senior debt of the guarantors.

        Payment on the 2021 old notes and the 2021 new notes will be subordinated in right of payment to all of the Issuer's and the guarantors' senior debt, including obligations under the credit agreement, the secured notes and the 2022 new (or old) notes. As a result, upon any distribution to the Issuer's or the guarantors' creditors in a bankruptcy, liquidation or reorganization or similar proceeding relating to the Issuer or the guarantors or its or their property, the holders of senior debt will be entitled to be paid in full in cash before any payment may be made on the 2021 old notes and the 2021 new notes. In these cases, sufficient funds may not be available to pay all of our creditors, and holders of 2021 old notes or 2021 new notes may receive less, ratably, than the holders of senior debt and, due to the turnover provisions in the indenture, less, ratably, than the holders of unsubordinated obligations, including trade payables. See "Description of 2021 New Notes—Ranking." In addition, all payments on the 2021 old notes and the guarantees will be blocked in the event of a payment default on senior debt and may be blocked for limited periods in the event of certain nonpayment defaults under the credit agreement.

We may be unable to finance a change of control offer.

        If certain change of control events occur, the Issuer will be required to make an offer for cash to purchase the notes at 101% of their principal amount, plus accrued and unpaid interest and additional interest, if any. However, we cannot assure you that the Issuer will have the financial resources necessary to purchase the new notes upon a change of control or that it will have the ability to obtain the necessary funds on satisfactory terms, if at all. A change of control may result in an event of default under our credit agreement and may result in a default under other of our indebtedness that may be incurred in the future and would also require us to offer to purchase the secured notes, the 2020 notes and the 2018 notes at 101% of the principal amount thereof, plus accrued and unpaid interest. Our credit agreement prohibits the purchase of outstanding notes prior to repayment of the borrowings under the credit agreement, subject to certain exceptions, and any exercise by the holders of the notes, the secured notes, the 2020 notes and the 2018 notes of their right to require us to repurchase the notes may cause an event of default under our credit agreement. In addition, certain important corporate events, such as leveraged recapitalizations that would increase the level of our indebtedness, would constitute a "Change of Control" under the indentures. See "Description of 2021 New Notes—Change of Control" and "Description of 2022 New Notes—Change of Control."

Investors may not be able to determine when a change of control giving rise to their right to have the notes repurchased by the Issuer has occurred following a sale of "substantially all" of our assets.

        A change of control (or, in the case of the 2021 new notes and 2021 old notes, a change of control repurchase event), as defined in the indentures governing the notes, will require the Issuer to make an offer to repurchase all outstanding notes. The definition of change of control includes a phrase relating to the sale, lease or transfer of "all or substantially all" of our assets. There is no precisely established definition of the phrase "substantially all" under applicable law. Accordingly, the ability of a holder of notes to require the Issuer to repurchase their notes as a result of a sale, lease or transfer of less than all of the Issuer's assets to another individual, group or entity may be uncertain.

You may be required to dispose of, or we may be permitted to redeem, the notes pursuant to gaming laws.

        Certain gaming authorities currently may require a holder of the notes to be licensed or found qualified or suitable under applicable laws and regulations. It is possible that gaming authorities in additional jurisdictions could impose similar requirements. If, at any time, a holder of notes is required to be licensed or found qualified under any applicable gaming laws or regulations and that holder does not become so licensed or found qualified or suitable, the Issuer will have the right, at its option, (1) to require that holder of notes to dispose of all or any portion of those notes within 60 days after the

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holder receives notice of that finding, or at some other time as prescribed by the applicable gaming authorities, or (2) to redeem the notes of that holder upon not less than 30 nor more than 60 days prior notice, at a redemption price equal to the lesser of the principal amount thereof, or the price at which such holder or beneficial owner acquired the notes, together with, in each case, accrued and unpaid interest to the earlier of the date of redemption or the date of the denial of license or qualification or of the finding of unsuitability by such gaming authority (or if such gaming authority restricts the redemption price to a lesser amount, then such lesser amount shall be the redemption price).

If a bankruptcy petition were filed by or against us in the United States, the allowed claim for the notes may be less than the principal amount of the notes stated in the indentures.

        If a bankruptcy petition were filed by or against us under the U.S. Bankruptcy Code after the issuance of the notes, the claim by any holder of the notes for the principal amount of the notes may be allowed in an amount equal to the sum of:

        Any such discount that was not amortized as of the date of the bankruptcy filing would constitute unmatured interest, which is not allowable as part of a bankruptcy claim under the U.S. Bankruptcy Code. Accordingly, holders of notes under these circumstances may receive an amount that is less than the principal amount of the notes.

We are exposed to the risk of higher interest rates.

        Our indebtedness under the credit agreement has variable rates of interest, which exposes us to the risk of higher interest rates. We have entered into floating to fixed interest rate swap (and swaption) agreements to fix a portion of our floating LIBOR-based debt under the credit agreement; however, if interest rates were to increase, the interest payment obligations under our remaining variable rate indebtedness would increase even if the amount borrowed remained the same, which could have a material adverse effect on our business, results of operation, cash flows or financial condition.

The 2022 old notes were issued with original issue discount for U.S. federal income tax purposes.

        The 2022 old notes were issued with original issue discount for U.S. federal income tax purposes. As a result, investors in the 2022 new notes that are subject to U.S. federal income taxation will be subject to special rules relating to the accrual of income for U.S. federal income tax purposes. See "Certain U.S. Federal Income Tax Considerations Relating to the Exchange of 2022 Old Notes for 2022 New Notes and the Ownership and Disposition of the 2022 New Notes."

Risk Factors Relating to the Exchange Offer

If you fail to follow the exchange offer procedures, your old notes will not be accepted for exchange.

        We will not accept your old notes for exchange if you do not follow the exchange offer procedures. We will issue new notes as part of this exchange offer only after timely receipt of your old notes, a properly completed and duly executed letter of transmittal and all other required documents or if you comply with the guaranteed delivery procedures for tendering your old notes. Therefore, if you want to tender your old notes, please allow sufficient time to ensure timely delivery. If we do not receive your old notes, letter of transmittal, and all other required documents by the expiration date of the exchange

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offer, or you do not otherwise comply with the guaranteed delivery procedures for tendering your old notes, we will not accept your old notes for exchange. Neither we nor the exchange agent is required to give notification of defects or irregularities with respect to the tenders of old notes for exchange. If there are defects or irregularities with respect to your tender of old notes, we will not accept your old notes for exchange unless we decide in our sole discretion to waive such defects or irregularities.

Any outstanding old notes after the consummation of the exchange offer will continue to be subject to existing transfer restrictions, and the holders of old notes after the consummation of the exchange offer may not be able to sell their old notes.

        We did not register the old notes under the Securities Act or any state securities laws, nor do we intend to do so after the exchange offer. As a result, the old notes may only be transferred in limited circumstances under the securities laws. If you do not exchange your old notes in the exchange offer, you will lose your right to have the old notes registered under the Securities Act, subject to certain exceptions. If you continue to hold old notes after the exchange offer, you may be unable to sell the old notes because there will be fewer old notes outstanding. Old notes that are not tendered or are tendered but not accepted will, following the exchange offer, continue to be subject to existing transfer restrictions.

Lack of an active market for the new notes may adversely affect the liquidity and market price of the new notes.

        We do not intend to apply for a listing of the new notes on any securities exchange. We do not know if an active public market for the new notes will develop or, if developed, will continue. If an active public market does not develop or is not maintained, the market price and liquidity of the new notes may be adversely affected. We cannot make any assurances regarding the liquidity of the market for the new notes, the ability of holders to sell their new notes or the price at which holders may sell their new notes. In addition, the liquidity and the market price of the new notes may be adversely affected by changes in the overall market for securities similar to the new notes, by changes in our business, results of operations, cash flows or financial condition, and by changes in conditions in the industries in which we operate. In addition, if a large amount of old notes are not tendered or are tendered improperly, the amount of new notes that would be issued and outstanding after we consummate the exchange offer could lower the market price of such new notes.

The market price for the new notes may be volatile.

        Historically, the market for non-investment grade debt has been subject to disruptions that have caused substantial volatility in the prices of securities similar to the new notes. The market for the new notes, if any, may be subject to similar disruptions. Any such disruptions may adversely affect the value of your new notes.

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USE OF PROCEEDS

        We will not receive any proceeds from the exchange offer. Because we are exchanging the new notes for the old notes, which have substantially identical terms, the issuance of the new notes will not result in any increase in our indebtedness. The exchange offer is intended to satisfy our obligations under the registration rights agreements.

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CAPITALIZATION

        The following table sets forth our cash and cash equivalents and capitalization as of December 31, 2014. You should read this table in conjunction with "Selected Financial Data" and our consolidated financial statements and accompanying notes and the related "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections included in our Annual Report on Form 10-K for the year ended December 31, 2014, which report is incorporated herein by reference.

($ in millions)
  As of
December 31,
2014
 

Cash and cash equivalents(1)

  $ 171.8  

Debt:

       

Credit Facilities:

       

Revolver, varying interest rate, due 2018(2)

  $ 185.0  

Term loan, varying interest rate, due 2020(3)

    2,267.6  

Term loan, varying interest rate, due 2021(4)

    1,980.3  

8.125% senior subordinated notes due 2018

    250.0  

6.250% senior subordinated notes due 2020

    300.0  

6.625% senior subordinated notes due 2021

    347.8  

7.000% senior secured notes due 2022

    950.0  

10.000% senior unsecured notes due 2022

    2,200.0  

Capital lease obligations

    35.3  

Total debt

    8,516.0  

Stockholders' equity:

       

Class A Common

    1.0  

Additional paid-in-capital

    743.2  

Accumulated loss

    (470.7 )

Treasury stock, at cost

    (175.2 )

Accumulated other comprehensive income

    (94.4 )

Total stockholders' equity

    3.9  

Total capitalization

  $ 8,519.9  

(1)
Cash and cash equivalents does not reflect $44.0 million of current and non-current restricted cash as of December 31, 2014.

(2)
At December 31, 2014, availability under our $567.6 million revolving credit facility was $341.6 million as there were $185.0 million of borrowings and $41.0 million of letters of credit outstanding. On February 11, 2015, the amount of our revolving credit facility was increased by $25.0 million to $592.6 million.

(3)
Principal balance of $2,277.0 million less unamortized balance of loan discount in the amount $9.4 million as of December 31, 2014.

(4)
Principal balance of $2,000.0 million less unamortized balance of loan discount in the amount $19.7 million as of December 31, 2014.

(5)
Principal balance of $350.0 million less unamortized balance of loan discount in the amount $2.2 million as of December 31, 2014.

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UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

        On November 21, 2014, Scientific Games Corporation ("Scientific Games" or the "Company") acquired Bally Technologies, Inc. ("Bally") through the merger of a wholly owned subsidiary of the Company with and into Bally, with Bally surviving the merger as a wholly owned subsidiary of Scientific Games. At the closing of the Bally acquisition, each outstanding share of Bally common stock, par value $0.10, was converted into the right to receive $83.30 per common share in cash, without interest. The aggregate amount paid by the Company for all of the equity securities of Bally was approximately $3.2 billion.

        The following unaudited pro forma combined statement of operations has been prepared to illustrate the effect of the following transactions:

        The proceeds from the New Credit Facilities and the Senior Notes Offering were used, in part, to finance the consideration paid in the Bally Acquisition, to repay indebtedness of Bally and to pay related acquisition and financing fees and expenses. The Bally Acquisition, the other acquisitions and the related financing transactions listed above are collectively referred to herein as the "Transactions."

        The following unaudited pro forma combined statement of operations has been derived by the application of pro forma adjustments to the historical audited and/or unaudited consolidated statements of operations of Scientific Games, Bally, SHFL and Dragonplay. The following unaudited pro forma combined statement of operations gives effect to the SHFL Acquisition, the Dragonplay Acquisition and the Bally Acquisition under the acquisition method of accounting in accordance with FASB ASC Topic 805, Business Combinations ("ASC 805"), with Scientific Games treated as the acquirer in the Bally acquisition, and Bally treated as the acquirer in the SHFL Acquisition and Dragonplay Acquisition. The historical consolidated financial information has been adjusted in the unaudited pro forma combined statement of operations to give effect to pro forma adjustments that are (1) directly attributable to the Transactions, (2) factually supportable, and (3) expected to have a continuing impact on the combined results of the Company.

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        The unaudited pro forma combined statement of operations for the year ended December 31, 2014 combines the historical results of operations of Scientific Games, Bally, SHFL and Dragonplay giving effect to the SHFL Acquisition, the Dragonplay Acquisition, the Bally Acquisition and the other Transactions as if they occurred on January 1, 2014. The combined pro forma impacts of the SHFL Acquisition and the Dragonplay Acquisition are reflected in the column "Bally Pro Forma" in the unaudited pro forma combined statement of operations and are herein referred to as "Bally Pro Forma." As of the date of this prospectus, an unaudited pro forma balance sheet is not required as the Transactions are reflected in the Company's most recently issued balance sheet included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014, which is incorporated herein by reference.

        The unaudited pro forma combined statement of operations do not reflect future events that may occur following the Transactions, including, but not limited to, the expected realization of anticipated operating synergies and certain costs expected to be incurred in connection with realizing anticipated operating synergies and integration activities, including, but not limited to, costs in connection with integrating the operations of Scientific Games with Bally. However, the unaudited pro forma statements of operations reflect operating synergies and certain charges, such as integration costs and restructuring charges, which Scientific Games recognized related to the WMS acquisition and Bally recognized related to the SHFL Acquisition and Dragonplay Acquisition in their respective historical financial statements; no pro forma adjustment has been reflected to give effect to future operating synergies that Scientific Games and Bally management expect to achieve as a result of the WMS acquisition, the Dragonplay Acquisition and the Bally Acquisition or the costs necessary to achieve these anticipated costs savings.

        The unaudited pro forma combined statements of operations are for informational purposes only and are based on the estimates and assumptions set forth in the accompanying notes. They do not purport to indicate the results that would actually have been obtained had the Transactions been completed on January 1, 2014 or for the period presented, or which may be realized in the future. We have recorded Bally's assets acquired and liabilities assumed based on our preliminary estimates of their fair values at the acquisition date of November 21, 2014. The determination of the fair values of the assets acquired and liabilities assumed (and the related determination of estimated lives of depreciable and amortizable tangible and identifiable intangible assets) requires significant judgment and estimate. The estimates and assumptions used include the projected timing and amount of future cash flows and discount rates reflecting risk inherent in the future cash flows. The estimated fair values of Bally's assets acquired and liabilities assumed and resulting goodwill are subject to adjustment as the Company finalizes its fair value analysis. The significant items for which a final fair value has not been determined as of the date of this registration statement include accrued liabilities, deferred income taxes and other long-term liabilities. We expect to complete our fair value determinations no later than the fourth quarter of 2015. We do not expect our fair value determinations to change; however, there may be differences compared to those amounts reflected in our consolidated financial statements at December 31, 2014 as we finalize our fair value analysis and such changes could be material.

        The pro forma combined statement of operations should be read in conjunction with:

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Unaudited Pro Forma Combined Statement of Operations for the year ended December 31, 2014

 
   
   
   
   
   
  Note 3    
   
   
   
 
 
   
  Bally
January 1,
2014 -
September 30,
2014
  Bally
October 1,
2014 -
November 21,
2014
  Note 2    
  Dragonplay
January 1,
2014 -
June 30,
2014
   
  Note 5    
   
 
 
  Scientific
Games As
Reported
  Pro Forma
and Other
Adjustments
   
  Bally
Pro Forma
  Pro Forma
and Other
Adjustments
   
  Scientific
Games
Pro Forma
 

Statement of operations data:

                                                         

Revenue:

                                                         

Instant games

  $ 533.0   $   $   $       $   $   $       $ 533.0  

Services

    788.5     396.4     56.6             16.6     497.9             1,258.1  

Product sales

    464.9     605.0     84.9                 661.6             1,154.8  

Total revenue

    1,786.4     1,001.4     141.5             16.6     1,159.5             2,945.9  

Operating expenses:

                                                         

Cost of instant games(1)

    291.4                                     291.4  

Cost of services(1)

    283.7     127.7     26.3             4.8     158.8     (71.7 ) a     370.8  

Cost of product sales(1)

    274.3     242.2     25.3     (5.3 ) a         262.2     (6.6 ) b     529.9  

Selling, general and administrative expenses

    507.7     272.9     67.5     (7.0 ) b     6.7     340.1     (119.8 ) c     728.0  

Research and development

    117.0     108.1     18.5                 126.6             243.6  

Employee termination and restructuring costs

    30.7                                     30.7  

Depreciation and amortization

    454.3     62.4     12.1     2.7   c     3.9     81.0     234.6   d     770.0  

Operating income (loss)

    (172.7 )   188.1     (8.2 )   9.5         1.3     190.7     (36.6 )       (18.6 )

Other income (expense):

                                                         

Interest expense

    (307.2 )   (58.9 )   (10.2 )               (69.1 )   (285.7 ) e     (662.0 )

Loss from equity investments

    (7.6 )                                   (7.6 )

Loss on early extinguishment of debt

    (25.9 )   (7.3 )                   (7.3 )   25.9   f     (7.3 )

Gain on sale of equity interest

    14.5                                     14.5  

Other (expense) income, net

    4.0     0.5     0.4                 0.9             4.9  

Total other expense, net

    (322.2 )   (65.7 )   (9.8 )               (75.5 )   (259.8 )       (657.4 )

Net (loss) income from continuing operations before income taxes

    (494.9 )   122.4     (18.0 )   9.6         1.3     115.2     (296.4 )       (676.0 )

Income tax (expense) benefit

    260.6     (54.1 )   9.2     (3.4 ) d     1.0     (47.3 )   33.0   g     246.3  

Net (loss) income from continuing operations

  $ (234.3 ) $ 68.3   $ (8.8 ) $ 6.2       $ 2.2   $ 67.9   $ (263.3 )     $ (429.7 )

Basic and diluted net loss per share:

                                                         

Basic from continuing operations

    (2.77 )                                               (5.08 )

Diluted from continuing operations:

    (2.77 )                                               (5.08 )

Weighted average number of shares used in per share calculations:

   
 
   
 
   
 
   
 
 

 

   
 
   
 
   
 
 

 

   
 
 

Basic shares

    84.6                                                 84.6  

Diluted shares

    84.6                                                 84.6  

(1)
Exclusive of depreciation and amortization.

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NOTES TO THE UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

(Unaudited, in millions, except per share amounts)

1. Description of Bally Acquisition and basis of presentation

        On November 21, 2014, the Company acquired Bally through the merger of a wholly owned subsidiary of the Company with and into Bally, with Bally surviving the merger as a wholly owned subsidiary of Scientific Games. At the closing of the Bally Acquisition, each outstanding share of Bally common stock, par value $0.10, was converted into the right to receive $83.30 per common share in cash, without interest.

        Equity awards granted by Bally following August 1, 2014, the date of the merger agreement, were not cancelled but instead were converted into equivalent Scientific Games restricted stock units ("RSUs") using a customary exchange ratio of Bally's stock price to Scientific Games' stock price on the closing date.

        The SHFL Acquisition, Dragonplay Acquisition and Bally Acquisition are reflected in the unaudited pro forma combined financial statements as being accounted for under the acquisition method in accordance with ASC 805, with Scientific Games treated as the accounting and legal acquirer in the Bally Acquisition and Bally treated as the legal and accounting acquirer in the SHFL Acquisition and the Dragonplay Acquisition. In accordance with ASC 805, the assets acquired and liabilities assumed have been measured at fair value. The fair values of the assets acquired and liabilities assumed in the SHFL Acquisition are finalized. As of the date of this prospectus, the significant items for which a final fair value has not been determined for the Bally Acquisition include accrued liabilities, deferred income taxes and other long-term liabilities. We expect to complete our fair value determinations no later than the fourth quarter of 2015. We do not expect our fair value determinations to change; however, there may be differences compared to those amounts reflected in our consolidated financial statements at December 31, 2014 as we finalize our fair value analysis and such changes could be material.

        For purposes of estimating the fair value, where applicable, of the assets acquired and liabilities assumed as reflected in the unaudited pro forma combined statement of operations, Scientific Games and Bally have applied the guidance in ASC 820, Fair Value Measurements and Disclosures ("ASC 820"), which establishes a framework for measuring fair value in each of their respective acquisitions. In accordance with ASC 820, fair value is an exit price and is defined as "the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date." Under ASC 805, acquisition-related transaction costs and acquisition-related restructuring charges are not included as components of consideration transferred but are accounted for as expenses in the period in which the costs are incurred.

        The historical financial information of Scientific Games and Bally has been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Scientific Games' historical financial information was derived from its audited financial statements and Bally's historical financial information was derived from a combination of its audited and unaudited financial statements from January 1, 2014 to its date of its acquisition by Scientific Games. The historical financial statements for Dragonplay have been prepared in accordance with generally accepted accounting principles in Israel ("Israeli GAAP"). Dragonplay's historical financial information was derived from its unaudited financial statements from January 1, 2014 to its date of its acquisition by Bally. Any measurement differences in applying accounting principles between Israeli GAAP and U.S. GAAP as they apply to Dragonplay would not be considered material to the unaudited pro forma combined statement of operations.

        The unaudited pro forma combined statement of operations for the year ended December 31, 2014 were prepared in accordance with U.S. GAAP and pursuant to Article 11 of Regulation S-X under the

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Securities Act. The unaudited pro forma combined statement of operations is based upon the historical information of the respective companies. The unaudited pro forma combined statement of operations for the year ended December 31, 2014 combines the historical results of operations of Scientific Games, Bally, SHFL, and Dragonplay giving effect to the SHFL Acquisition, Dragonplay Acquisition and the Transactions as if they occurred on January 1, 2014. The unaudited pro forma combined statement of operations does not reflect all of the operating synergies that Scientific Games and Bally management expect to achieve as a result of Scientific Games' acquisition of WMS, the SHFL Acquisition, the Dragonplay Acquisition and the Bally Acquisition, respectively, or the costs necessary to achieve these anticipated costs savings.

2. Pro forma adjustments related to the SHFL Acquisition

        The pro forma adjustments included in the unaudited pro forma statement of operations for the year ended December 31, 2014 related to the SHFL Acquisition are as follows:

3. Preliminary pro forma adjustments related to the Dragonplay Acquisition

        The historical financial statements for Dragonplay have been prepared in accordance with Israeli GAAP and reported in U.S. dollars. Any measurement differences in applying accounting principles between Israeli GAAP and U.S. GAAP as they apply to Dragonplay would not be considered material to the unaudited pro forma combined statement of operations.

        Note that the column "Dragonplay" in the unaudited pro forma combined statement of operations includes the historical results of Dragonplay, as well as pro forma adjustments related to the Dragonplay Acquisition. The pro forma adjustments included in the unaudited pro forma combined statement of operations related to the Dragonplay Acquisition are as follows:

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4. Preliminary purchase price allocation related to the Bally Acquisition

        The Bally Acquisition has been accounted for using the acquisition method of accounting in accordance with ASC 805, which requires, among other things, that the assets acquired and liabilities assumed be recognized at their acquisition date fair values, with any excess of the consideration transferred over the estimated fair values of the identifiable net assets acquired recorded as goodwill.

        The purchase price for the Bally Acquisition is presented below (in millions, except for share price):

Purchase price for Bally common stock (37.9 shares at $83.30 per share)

  $ 3,158.1  

Payments in respect of vested Bally stock options, RSUs, restricted shares and performance units, inclusive of tax(1)

    42.4  

Total estimated value of consideration transferred

  $ 3,200.5  

(1)
The total payment in respect of outstanding stock options, RSUs restricted shares, and performance units, inclusive of tax, was $83.4 million, $42.4 million of which related to the vested portion of these awards and has been treated as part of the total merger consideration. The remaining payment of $41.0 million relates to unvested equity awards that were cancelled upon the closing of the Bally Acquisition and has been recorded as post-combination expense and not as part of the total merger consideration.

        The preliminary allocation of the purchase price to the fair values of assets acquired and liabilities assumed in the Bally Acquisition is presented below (in millions):

At November 21, 2014

       

Total estimated value of consideration transferred

  $ 3,200.5  

Cash and cash equivalents

    59.9  

Restricted cash

    16.0  

Accounts receivable

    217.1  

Notes receivable

    22.0  

Inventories

    134.0  

Deferred income taxes, current portion

    32.4  

Prepaid expenses, deposits and other current assets

    71.6  

Property and equipment

    335.3  

Restricted long-term cash and investments

    19.3  

Intangible assets

    1,800.3  

Software

    308.4  

Other assets

    61.8  

Total assets

    3,078.0  

Long-term debt, including amounts due within one year

    1,882.9  

Accounts payable

    33.0  

Accrued liabilities

    133.7  

Deferred income taxes

    747.0  

Other long-term liabilities

    37.0  

Net assets to be acquired

    244.4  

Goodwill

  $ 2,956.1  

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5. Pro forma adjustments related to the Bally Acquisition, the Bally Acquisition Financing Transactions and the 2014 Refinancing Transactions

        The preliminary pro forma adjustments included in the unaudited pro forma combined statement of operations for the year ended December 31, 2014 related to the Bally Acquisition, the Bally Acquisition Financing Transactions and the 2014 Refinancing Transactions are presented below:

Property and Equipment
  Remaining
useful life range
(in years)
  Fair values at
November 21,
2014
  D&A expense for
Year Ended
December 31, 2014
 

Land and land improvements

  Indefinite   $ 18.1   $  

Buildings and leasehold improvements

  2 - 40     36.3     1.6  

Furniture, fixtures, and other property, plant and equipment

  2 - 15     33.6     8.8  

Leased gaming equipment

  1 - 3     247.3     87.0  

Total

      $ 335.3   $ 97.4  

 

Intangible Assets
  Weighted-
average
remaining useful
life (in years)
  Fair values at
November 21,
2014
  D&A expense for
Year Ended
December 31, 2014
 

Trade names

  Indefinite   $ 225.0   $  

Brand names

  9.2 years     90.7     9.8  

Intellectual property

  7.2 years     734.7     99.8  

Customer relationships

  15.1 years     726.0     48.0  

Long-term licenses

  3.0 years     23.9     8.0  

Total

      $ 1,800.3   $ 165.6  

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Software
  Remaining
useful life range
(in years)
  Fair values at
November 21,
2014
  D&A expense for
Year Ended
December 31, 2014
 

Software

  2 - 6   $ 308.3   $ 70.0  

Total D&A

              333.0  

Less: Historical Bally preacquisition D&A

              (152.8 )

Less: Historical Bally D&A expense recorded in SGMS operations

              (36.5 )

Pro forma adjustment to D&A

            $ 143.7  

Composition of new debt and related interest expense
  Weighted
Average
Interest
Rate(1)
  Debt   Year Ended
December 31,
2014
 

Total new debt and related interest expense

    7.72 % $ 5,350.0   $ 412.7  

Amortization of new debt issuance costs

                23.4  

Total

              $ 436.1  

Incremental interest expense on existing term B-1 loan

                39.9  

Incremental revolver commitment fee

                0.3  

Less: Net interest expense decrease resulting from issuance of 2021 old notes and redemption of 2019 notes—see Note 5 adjustment (f)

                (3.9 )

Less: Bally pro forma interest expense

                (69.1 )

Less: Interest expense included in SGMS operations(2)

                (117.6 )

Pro forma adjustment to interest expense

              $ 285.7  

(1)
A change of 1/8% (12.5 basis points) in the interest rate would result in a $7.1 million change in annual interest expense.

(2)
Amount includes $64.7 million of debt financing fees incurred in connection with the financing of the Bally Acquisition. This amount is non-recurring in nature and is not expected to have a continuing impact on the combined results.

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THE EXCHANGE OFFER

Purpose of the Exchange Offer

        Simultaneously with the issuance and sale of the 2021 old notes on June 4, 2014, the Issuer and the guarantors entered into a registration rights agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the initial purchasers of the 2021 old notes (the "2021 registration rights agreement"). Simultaneously with the issuance and sale of the 2022 old notes on November 21, 2014, the Issuer and the guarantors entered into a registration rights agreement (pursuant to a joinder agreement) with J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Deutsche Bank Securities Inc., as representatives of the initial purchasers of the 2022 old notes (the "2022 registration rights agreement" and, together with the 2021 registration rights agreement, the "registration rights agreements"). Under each registration rights agreement, the Issuer and the guarantors agreed, among other things, to:

        The Issuer and the guarantors are conducting the exchange offer to satisfy these obligations under the registration rights agreements.

        Under some circumstances, the Issuer and the guarantors may be required to file and use their commercially reasonable efforts to cause to be declared effective by the SEC, in addition to or in lieu of the exchange offer registration statement, a shelf registration statement covering resales of the old notes. If the Issuer and the guarantors fail to meet specified deadlines under either registration rights agreement, then the Issuer, and, to the extent of their guarantees of the new notes, the guarantors, will be obligated to pay liquidated damages to holders of the old notes in the amount of a 0.25% per annum increase in the annual interest rate borne by the notes for the first 90-day period following such failure (which interest rate will increase by 0.25% per annum with respect to each subsequent 90-day period, up to a maximum additional rate of 1.0% per annum) until such failure is cured. See "Description of 2021 New Notes—Registration Rights" and "Description of 2022 New Notes—Registration Rights." A copy of each registration rights agreement has been filed as an exhibit to the registration statement of which this prospectus is a part, and the summary of the material provisions of the registration rights agreements does not purport to be complete and is qualified in its entirety by reference to the complete registration rights agreements.

Terms of the Exchange Offer

        The Issuer and the guarantors are offering to exchange an aggregate principal amount of up to $350.0 million of 2021 new notes and guarantees thereof for a like aggregate principal amount of 2021 old notes and guarantees thereof and an aggregate principal amount of up to $2,200.0 million of 2022 new notes and guarantees thereof for a like aggregate principal amount of 2022 old notes and guarantees thereof. The form and the terms of each series of new notes are identical in all material respects to the form and the terms of the applicable old notes except that the new notes:

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        The 2021 new notes and 2022 new notes evidence the same debt as the 2021 old notes and 2022 old notes, respectively, exchanged for the 2021 new notes and 2022 new notes, respectively, and will be entitled to the benefits of the same indenture under which such old notes were issued, each of which is governed by New York law. For a complete description of the terms of the 2021 new notes, see "Description of 2021 New Notes" and for a complete description of the terms of the 2022 new notes, see "Description of 2022 New Notes." We will not receive any cash proceeds from the exchange offer.

        The exchange offer is not extended to holders of old notes in any jurisdiction where the exchange offer would not comply with the securities or blue sky laws of that jurisdiction.

        As of the date of this prospectus, $350.0 million aggregate principal amount of 2021 old notes is outstanding and registered in the name of Cede & Co., as nominee for DTC and $2,200.0 million aggregate principal amount of 2022 old notes is outstanding and registered in the name of Cede & Co., as nominee for DTC. Only registered holders of the old notes, or their legal representatives and attorneys-in-fact, as reflected on the records of the trustee under the applicable indenture, may participate in the exchange offer. The Issuer and the guarantors will not set a fixed record date for determining registered holders of the old notes entitled to participate in the exchange offer. This prospectus, together with the letter of transmittal, is being sent to all registered holders of old notes and to others believed to have beneficial interests in the old notes.

        Upon the terms and subject to the conditions described in this prospectus and in the accompanying letter of transmittal, the Issuer will accept for exchange old notes which are properly tendered on or before the expiration date and not withdrawn as permitted below. As used in this section of the prospectus entitled, "The Exchange Offer," the term "expiration date" means 11:59 p.m., New York City time, on May 15, 2015. If, however, the Issuer and the guarantors, in their sole discretion, extend the period of time for which the exchange offer is open, the term "expiration date" means the latest time and date to which the exchange offer is so extended. Old notes tendered in the exchange offer must be in denominations of the principal amount of $2,000 and any integral multiple of $1,000 in excess thereof.

        If you do not tender your old notes or if you tender old notes that are not accepted for exchange, your old notes will remain outstanding and continue to accrue interest but will not retain any rights under the registration rights agreements. Existing transfer restrictions would continue to apply to old notes that remain outstanding. See "—Consequences of Failure to Exchange Old Notes" and "Risk Factors—Risk Factors Relating to the Exchange Offer—Any outstanding old notes after the consummation of the exchange offer will continue to be subject to existing transfer restrictions, and the holders of old notes after the consummation of the exchange offer may not be able to sell their old notes" for more information regarding old notes outstanding after the exchange offer. Holders of the old notes do not have any appraisal or dissenters' rights in connection with the exchange offer.

        None of the Issuer and the guarantors, their respective boards of directors or their management recommends that you tender or not tender old notes in the exchange offer or has authorized anyone to make any recommendation. You must decide whether to tender old notes in the exchange offer and, if you decide to tender, the aggregate amount of old notes to tender. We intend to conduct the exchange offer in accordance with the applicable requirements of the Exchange Act and the rules and regulations of the SEC promulgated under the Exchange Act.

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        The Issuer and the guarantors have the right, in their reasonable discretion and in accordance with applicable law, at any time:

        During an extension, all old notes previously tendered will remain subject to the exchange offer and may be accepted for exchange by the Issuer.

        We will give oral or written notice of any extension, delay, non-acceptance, termination or amendment to the exchange agent as promptly as practicable and make a public announcement of the extension, delay, non-acceptance, termination or amendment. In the case of an extension, the announcement will be made no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.

        If the Issuer and the guarantors amend the exchange offer in a manner that we consider material, we will as promptly as practicable distribute to the holders of the old notes a prospectus supplement or, if appropriate, an updated prospectus from a post-effective amendment to the registration statement of which this prospectus is a part disclosing the change and extend the exchange offer for a period of five to ten business days, depending upon the significance of the amendment of the exchange offer and the manner of disclosure to the registered holders, if the exchange offer would otherwise expire during the five to ten business day period.

Procedures for Tendering Old Notes

Valid Tender

        When the holder of old notes tenders, and the Issuer accepts, old notes for exchange, a binding agreement between the Issuer and the guarantors, on the one hand, and the tendering holder, on the other hand, is created, upon the terms and subject to the conditions set forth in this prospectus and the accompanying letter of transmittal.

        Except as described below under "—Guaranteed Delivery," a holder of old notes who wishes to tender old notes for exchange must, on or prior to the close of business on the expiration date:

        The term "agent's message" means a message transmitted to the exchange agent by DTC which states that DTC has received an express acknowledgment that the tendering holder agrees to be bound by the letter of transmittal and that the Issuer and the guarantors may enforce the letter of transmittal against that holder.

        In addition, on or prior to the expiration date:

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        If you beneficially own old notes and those notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee or custodian and you wish to tender your old notes in the exchange offer, you should contact the registered holder as soon as possible and instruct it to tender the old notes on your behalf and comply with the instructions set forth in this prospectus and the letter of transmittal.

        The method of delivery of the certificates for the old notes, the letter of transmittal and all other required documents is at your election and risk. If delivery is by mail, we recommend registered mail with return receipt requested, properly insured, or overnight delivery service. In all cases, you should allow sufficient time to assure delivery to the exchange agent before the expiration date. Delivery is complete when the exchange agent actually receives the items to be delivered. Delivery of documents to DTC in accordance with DTC's procedures does not constitute delivery to the exchange agent. Do not send letters of transmittal or old notes to the Issuer or any guarantor.

        The Issuer will not accept any alternative, conditional or contingent tenders. Each tendering holder, by execution of a letter of transmittal or by causing the transmission of an agent's message, waives any right to receive any notice of the acceptance of such tender.

Signature Guarantees

        Signatures on a letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed by an "Eligible Guarantor Institution" within the meaning of Rule 17Ad-15 under the Exchange Act unless the old notes surrendered for exchange are tendered:

        An "eligible institution" is a firm or other entity which is identified as an "Eligible Guarantor Institution" in Rule 17Ad-15 under the Exchange Act, including:

        If signatures on a letter of transmittal or notice of withdrawal are required to be guaranteed, the guarantor must be an eligible institution.

        If old notes are registered in the name of a person other than the signer of the letter of transmittal, the old notes surrendered for exchange must be endorsed or accompanied by a written instrument or instruments of transfer or exchange, in satisfactory form as determined by the Issuer and the guarantors in their sole discretion, duly executed by the registered holder with the holder's signature guaranteed by an eligible institution, and must also be accompanied by such opinions of counsel, certifications and other information as the Issuer and the guarantors or the trustee under the

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indenture for the old notes may require in accordance with the restrictions on transfer applicable to the old notes.

Book-Entry Transfers

        For tenders by book-entry transfer of old notes cleared through DTC, the exchange agent will make a request to establish an account at DTC for purposes of the exchange offer. Any financial institution that is a DTC participant may make book-entry delivery of old notes by causing DTC to transfer the old notes into the exchange agent's account at DTC in accordance with DTC's procedures for transfer. The exchange agent and DTC have confirmed that any financial institution that is a participant in DTC may use the Automated Tender Offer Program, or ATOP, procedures to tender old notes. Accordingly, any participant in DTC may make book-entry delivery of old notes by causing DTC to transfer those old notes into the exchange agent's account at DTC in accordance with DTC's ATOP procedures.

        Notwithstanding the ability of holders of old notes to effect delivery of old notes through book-entry transfer at DTC, either:

Guaranteed Delivery

        If a holder wants to tender old notes in the exchange offer and (1) the certificates for the old notes are not immediately available or all required documents are unlikely to reach the exchange agent on or prior to the expiration date, or (2) a book-entry transfer cannot be completed on a timely basis, the old notes may be tendered if:

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Determination of Validity

        The Issuer and the guarantors, in their sole discretion, will resolve all questions regarding the form of documents, validity, eligibility, including time of receipt, and acceptance for exchange of any tendered old notes. The determination of these questions by the Issuer and the guarantors, as well as their interpretation of the terms and conditions of the exchange offer, including the letter of transmittal, will be final and binding on all parties. A tender of old notes is invalid until all defects and irregularities have been cured or waived. Holders must cure any defects and irregularities in connection with tenders of old notes for exchange within such reasonable period of time as the Issuer and the guarantors will determine, unless they waive the defects or irregularities. None of the Issuer and the guarantors, any of their respective affiliates or assigns, the exchange agent or any other person is under any obligation to give notice of any defects or irregularities in tenders, nor will any of them be liable for failing to give any such notice.

        The Issuer and the guarantors reserve the absolute right, in their sole and absolute discretion:

        If any letter of transmittal, certificate, endorsement, bond power, power of attorney, or any other document required by the letter of transmittal is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, that person must indicate such capacity when signing. In addition, unless waived by the Issuer, the person must submit proper evidence satisfactory to the Issuer, in its sole discretion, of the person's authority to so act.

Acceptance of Old Notes for Exchange; Delivery of New Notes

        Upon satisfaction or waiver of all of the conditions to the exchange offer, the Issuer will, promptly after the expiration date, accept all old notes properly tendered and issue new notes registered under the Securities Act. See "—Conditions to the Exchange Offer" for a discussion of the conditions that must be satisfied or waived before old notes are accepted for exchange. The exchange agent might not deliver the new notes to all tendering holders at the same time. The timing of delivery depends upon when the exchange agent receives and processes the required documents.

        For purposes of the exchange offer, the Issuer will be deemed to have accepted properly tendered old notes for exchange when it gives oral or written notice to the exchange agent of acceptance of the tendered old notes, with written confirmation of any oral notice to be given promptly thereafter. The exchange agent is the agent of the Issuer for receiving tenders of old notes, letters of transmittal and related documents.

        For each old note accepted for exchange, the holder will receive a new note registered under the Securities Act having a principal amount equal to, and in the denomination of, that of the surrendered old note. Accordingly, registered holders of new notes issued in the exchange offer on the relevant record date for the first interest payment date following the consummation of the exchange offer will receive interest accruing from the most recent date to which interest has been paid on the old notes or, if no interest has been paid on the old notes, from June 4, 2014 (in the case of the 2021 old notes) and November 21, 2014 (in the case of the 2022 old notes). Old notes accepted for exchange will cease to accrue interest from and after the date of consummation of the exchange offer.

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        In all cases, the Issuer will issue new notes in the exchange offer for old notes that are accepted for exchange only after the exchange agent timely receives:

        If for any reason under the terms and conditions of the exchange offer the Issuer does not accept any tendered old notes, or if a holder submits old notes for a greater principal amount than the holder desires to exchange, the Issuer will return the unaccepted or non-exchanged old notes without cost to the tendering holder promptly after the expiration or termination of the exchange offer. In the case of old notes tendered by book-entry transfer through DTC, any unexchanged old notes will be credited to an account maintained with DTC.

Resales of New Notes

        Based on interpretive letters issued by the SEC staff to other, unrelated issuers in transactions similar to the exchange offer, we believe that a holder of new notes, other than a broker-dealer, may offer new notes (together with the guarantees thereof) for resale, resell and otherwise transfer the new notes (and the related guarantees) without delivering a prospectus to prospective purchasers, if the holder acquired the new notes in the ordinary course of business, has no intention of engaging in a "distribution," as defined under the Securities Act, of the new notes and is not an "affiliate," as defined under the Securities Act, of the Issuer or any guarantor. We will not seek our own interpretive letter. As a result, we cannot assure you that the SEC staff would take the same position with respect to this exchange offer as it did in interpretive letters to other parties in similar transactions.

        If the holder is an affiliate of the Issuer or any guarantor or is engaged in, or intends to engage in, or has an arrangement or understanding with any person to participate in, a distribution of the new notes, that holder or other person may not rely on the applicable interpretations of the staff of the SEC and must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction.

        By tendering old notes, the holder of those old notes will represent to the Issuer and the guarantors that, among other things:

        Any broker-dealer that holds old notes acquired for its own account as a result of market-making activities or other trading activities (other than old notes acquired directly from the Issuer) may exchange those old notes pursuant to the exchange offer; however, such broker-dealer may be deemed to be an "underwriter" within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the new notes received by such broker-dealer in the exchange offer. To date, the SEC has taken the position

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that broker-dealers may use a prospectus such as this one to fulfill their prospectus delivery requirements with respect to resales of new notes received in an exchange such as the exchange pursuant to the exchange offer, if the old notes for which the new notes were received in the exchange were acquired for their own accounts as a result of market-making or other trading activities. Any profit on these resales of new notes and any commissions or concessions received by a broker-dealer in connection with these resales may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not admit that it is an "underwriter" within the meaning of the Securities Act. See "Plan of Distribution and Selling Restrictions" for a discussion of the exchange and resale obligations of broker-dealers in connection with the exchange offer and the new notes.

Withdrawal Rights

        You can withdraw tenders of old notes at any time prior to the expiration date. For a withdrawal to be effective, you must deliver a written notice of withdrawal to the exchange agent or comply with the appropriate procedures of ATOP. Any notice of withdrawal must:

        If you delivered or otherwise identified certificated old notes to the exchange agent, you must submit the serial numbers of the old notes to be withdrawn and the signature on the notice of withdrawal must be guaranteed by an eligible institution, except in the case of old notes tendered for the account of an eligible institution. See "—Procedures for Tendering Old Notes—Signature Guarantees" for further information on the requirements for guarantees of signatures on notices of withdrawal. If you tendered old notes in accordance with applicable book-entry transfer procedures, the notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn old notes and you must deliver the notice of withdrawal to the exchange agent. You may not rescind withdrawals of tender; however, old notes properly withdrawn may again be tendered at any time on or prior to the expiration date in accordance with the procedures described under "—Procedures for Tendering Old Notes."

        The Issuer and the guarantors will determine, in their sole discretion, all questions regarding the validity, form and eligibility, including time of receipt, of notices of withdrawal. Their determination of these questions as well as their interpretation of the terms and conditions of the exchange offer (including the letter of transmittal) will be final and binding on all parties. None of the Issuer and the guarantors, any of their respective affiliates or assigns, the exchange agent or any other person is under any obligation to give notice of any irregularities in any notice of withdrawal, nor will any of them be liable for failing to give any such notice.

        Withdrawn old notes will be returned to the holder as promptly as practicable after withdrawal without cost to the holder. In the case of old notes tendered by book-entry transfer through DTC, the old notes withdrawn will be credited to an account maintained with DTC.

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Conditions to the Exchange Offer

        Notwithstanding any other provision of the exchange offer, the Issuer is not required to accept for exchange, or to issue new notes in exchange for, any old notes, and the Issuer and the guarantors may terminate or amend the exchange offer, if at any time prior to the expiration date, the Issuer and the guarantors determine that the exchange offer violates applicable law, any applicable interpretation of the staff of the SEC or any order of any governmental agency or court of competent jurisdiction.

        The foregoing conditions are for our sole benefit, and we may assert them regardless of the circumstances giving rise to any such condition, or we may waive the conditions, completely or partially, whenever or as many times as we choose, in our sole discretion. The foregoing rights are not deemed waived because we fail to exercise them, but continue in effect, and we may still assert them whenever or as many times as we choose. If we determine that a waiver of conditions materially changes the exchange offer, the prospectus will be amended or supplemented, and the exchange offer extended, if appropriate, as described under "—Terms of the Exchange Offer."

        In addition, at a time when any stop order is threatened or in effect with respect to the registration statement of which this prospectus constitutes a part or with respect to the qualification of the indenture under the Trust Indenture Act of 1939, as amended, we will not accept for exchange any old notes tendered, and no new notes will be issued in exchange for any such old notes.

        If the Issuer and the guarantors are not permitted to consummate the exchange offer because the exchange offer is not permitted by applicable law, any applicable interpretation of the staff of the SEC or any order of any governmental agency or court of competent jurisdiction, the registration rights agreements require that the Issuer and the guarantors file a shelf registration statement to cover resales of the old notes by the holders thereof who satisfy specified conditions relating to the provision of information in connection with the shelf registration statement. See "Description of 2021 New Notes—Registration Rights" and "Description of 2022 New Notes—Registration Rights."

Exchange Agent

        We have appointed Deutsche Bank Trust Company Americas as exchange agent for the exchange offer. You should direct questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal and requests for notices of guaranteed delivery to the exchange agent. Holders of old notes seeking to (1) tender old notes in the exchange offer should send certificates for old notes, letters of transmittal and any other required documents and/or (2) withdraw such tendered old notes should send such required documentation (in accordance with the procedures described under "—Withdrawal Rights") to the exchange agent by hand-delivery, registered or certified first-class mail (return receipt requested), telex, telecopier or any courier guaranteeing overnight delivery, as follows:

By Registered or Certified Mail:   By Hand Delivery:

DB Services Americas, Inc.
Attention: Reorg. Department
5022 Gate Parkway, Suite 200
Jacksonville, FL 32256

 

DB Services Americas, Inc.
Attention: Reorg. Department
5022 Gate Parkway, Suite 200
Jacksonville, FL 32256

By Overnight Delivery:

 

By Facsimile:

DB Services Americas, Inc.
Attention: Reorg. Department
5022 Gate Parkway, Suite 200
Jacksonville, FL 32256

 

(615) 866-3889

Confirm by Telephone:

(877)  843-9767

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        If you deliver the letter of transmittal or any other required documents to an address or facsimile number other than as indicated above, your tender of old notes will be invalid.

Fees and Expenses

        The registration rights agreements provide that the Issuer and the guarantors will bear all expenses in connection with the performance of their obligations relating to the registration of the new notes and the conduct of the exchange offer. These expenses include registration and filing fees, rating agency fees, fees and disbursements of the trustee under the indenture, accounting and legal fees and printing costs, among others. We will pay the exchange agent reasonable and customary fees for its services and reasonable out-of-pocket expenses. We will also reimburse brokerage houses and other custodians, nominees and fiduciaries for customary mailing and handling expenses incurred by them in forwarding this prospectus and related documents to their clients that are holders of old notes and for handling or tendering for those clients.

        We have not retained any dealer-manager in connection with the exchange offer and will not pay any fee or commission to any broker, dealer, nominee or other person, other than the exchange agent, for soliciting tenders of old notes pursuant to the exchange offer.

Transfer Taxes

        Holders who tender their old notes for exchange will not be obligated to pay any transfer taxes in connection with the exchange. If, however, new notes issued in the exchange offer are to be delivered to, or are to be issued in the name of, any person other than the holder of the old notes tendered, or if a transfer tax is imposed for any reason other than the exchange of old notes in connection with the exchange offer, then any such transfer taxes, whether imposed on the registered holder or on any other person, will be payable by the holder or such other person. If satisfactory evidence of payment of, or exemption from, such taxes is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed directly to the tendering holder.

Accounting Treatment

        The new notes will be recorded at the same carrying value as the old notes. Accordingly, we will not recognize any gain or loss for accounting purposes. We intend to amortize the expenses of the exchange offer and issuance of the old notes over the term of the new notes.

Consequences of Failure to Exchange Old Notes

        Holders of the old notes do not have any appraisal or dissenters' rights in the exchange offer. Old notes that are not tendered or are tendered but not accepted will, following the consummation of the exchange offer, remain outstanding and continue to be subject to the provisions in the applicable indenture regarding the transfer and exchange of the old notes and the existing restrictions on transfer set forth in the legends on the old notes. In general, the old notes, unless registered under the Securities Act, may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. Following the consummation of the exchange offer, except in limited circumstances with respect to specific types of holders of old notes, the Issuer and the guarantors will have no further obligation to provide for the registration under the Securities Act of the old notes. See "Description of 2021 New Notes—Registration Rights" and "Description of 2022 New Notes—Registration Rights." We do not currently anticipate that we will take any action following the consummation of the exchange offer to register the old notes under the Securities Act or under any state securities laws.

        The new notes and any old notes which remain outstanding after consummation of the exchange offer will vote together for all purposes as a single class under the indenture.

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SELECTED FINANCIAL DATA

        Selected financial data presented below as of and for the years ended December 31, 2014, 2013, 2012, 2011 and 2010 have been derived from our audited consolidated financial statements. This data should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended December 31, 2014, filed on March 17, 2015, which report is incorporated herein by reference. See "Where You Can Find More Information" and "Incorporation of Certain Documents by Reference."

 
  As of and for the Years Ended December 31,  
($ in millions, except per share amounts)
  2014
  2013
  2012
  2011
  2010
 

Total revenue

  $ 1,786.4   $ 1,090.9   $ 928.6   $ 865.9   $ 870.5  

Operating (loss) income(1)

    (172.7 )   (18.3 )   62.9     92.2     62.9  

Total other (expense) income(2)

    (322.2 )   (125.0 )   (86.1 )   (79.6 )   (63.5 )

Net (loss) income from continuing operations before income taxes

    (494.9 )   (143.3 )   (23.2 )   12.6     (0.6 )

Income tax benefit (expense)

    260.6     117.7     (20.7 )   (18.4 )   (143.8 )

Net loss from continuing operations

  $ (234.3 )   (25.6 )   (43.9 )   (5.8 ) $ (144.4 )

Basic and diluted net loss per share:

                               

Basic from continuing operations

  $ (2.77 ) $ (0.30 ) $ (0.49 ) $ (0.06 ) $ (1.56 )

Diluted from continuing operations

  $ (2.77 ) $ (0.30 ) $ (0.49 ) $ (0.06 ) $ (1.56 )

Weighted average number of shares used in per share calculations:

   
 
   
 
   
 
   
 
   
 
 

Basic shares

    84.6     85.0     90.0     92.1     92.7  

Diluted shares

    84.6     85.0     90.0     92.1     92.7  

Statement of Cash Flows Data

   
 
   
 
   
 
   
 
   
 
 

Net cash provided by operating activities

  $ 203.5   $ 171.2   $ 156.8   $ 171.1   $ 170.5  

Net cash used in investing activities

    (3,332.9 )   (1,664.7 )   (141.9 )   (161.1 )   (287.6 )

Net cash provided by (used in) financing activities

    3,157.4     1,538.7     (10.1 )   (24.7 )   (9.8 )

Effect of exchange rates changes on cash and cash equivalents

    (9.9 )   (0.5 )   (0.2 )   (5.2 )   (9.0 )

Increase (decrease) in cash and cash equivalents

  $ 18.1   $ 44.7   $ 4.6   $ (19.9 ) $ (135.9 )

Balance Sheet Data

                               

Total assets

  $ 9,995.2   $ 4,236.4   $ 2,186.9   $ 2,161.9   $ 2,151.5  

Total long-term debt, including current installments

  $ 8,516.0   $ 3,192.6   $ 1,468.2   $ 1,390.7   $ 1,396.7  

Stockholders' equity

  $ 3.9   $ 375.0   $ 364.8   $ 443.7   $ 452.7  

(1)
Operating (loss) income includes:

$6.6 million and $13.0 million in cost of product sales for the write-up of finished goods inventory required under purchase accounting for the Bally and WMS acquisitions in 2014 and 2013, respectively, and $17.8 million in cost of product sales for inventory write-offs related to certain of our product lines in the gaming operating segment in 2014;

charges for legal contingencies and settlements of $24.8 million and $24.5 million in 2014 and 2013, respectively, in SG&A, as well as $76.6 million of acquisition-related fees and expenses in SG&A related to the Bally acquisition (including $41.0 million for the acceleration of Bally

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(2)
Other expense includes:

interest expense, which includes $64.7 million of debt financing fees incurred as a result of the Bally acquisition in 2014;

loss on early extinguishment of debt, which includes losses that we incur when we refinance our long-term debt obligations and also includes write-offs of the associated deferred financing costs, which aggregated $25.9 million, $5.9 million, $15.5 million, $4.2 million and $2.9 million in 2014, 2013, 2012, 2011 and 2010, respectively. See Note 15 (Long-Term and Other Debt) to our Annual Report filed on 10-K and incorporated by reference herein for more information regarding our debt instruments.

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DESCRIPTION OF OTHER INDEBTEDNESS

Credit Agreement

        We are party to a credit agreement, dated as of October 18, 2013, by and among the Issuer, as the borrower, the Company, as a guarantor, the lenders party thereto and Bank of America, N.A., as administrative agent, collateral agent, issuing lender and swingline lender.

        Prior to the increase in the revolving credit facility and the assumption of the incremental term loans discussed below, the credit agreement provided for senior secured credit facilities in an aggregate principal amount of $2,600 million, including a $300.0 million revolving credit facility, which has dollar and multi-currency tranches and a $2,300 million term B-1 loan facility.

        On October 1, 2014, we amended our Credit Agreement to, among other things, (1) permit the Bally acquisition and the transactions related thereto and (2) effective as of the closing of the Bally acquisition, (A) increase our revolving credit facility to $567.6 million, (B) permit the Issuer to assume the term loans under the Escrow Credit Agreement referred to below as incremental term B-2 loans under the credit agreement and (C) modify the financial covenant contained in the credit agreement such that it will be tested each quarter, irrespective of usage of the revolving credit facility.

        In addition, on October 1, 2014, SGMS Escrow Corp. entered into an escrow credit agreement by and among SGMS Escrow Corp., as borrower, the lenders party thereto and Bank of America, N.A., as administrative agent. The escrow credit agreement provided for $2,000 million of term loans, the net proceeds of which provided a portion of the funds used to finance the Bally acquisition. Upon the consummation of the Bally acquisition, the term loans under the escrow credit agreement were assumed by the Issuer as incremental term B-2 loans under the credit agreement (and, from and after the Bally acquisition, the escrow credit agreement no longer applied to the term B-2 loans).

        As of December 31, 2014, our total debt under the credit agreement was comprised of $185.0 million of borrowings and approximately $41.0 million in outstanding letters of credit under the revolving credit facility, $2,277.0 million of outstanding term B-1 loans and $2,000.0 million of outstanding term B-2 loans. As of December 31, 2014, we had approximately $341.6 million available for additional borrowing or letter of credit issuances under the revolving credit facility. Our ability to borrow under the credit agreement will depend on us remaining in compliance with the covenants contained in the credit agreement, including maintenance of the financial ratios discussed below.

        On February 11, 2015, the Issuer entered into a lender joinder agreement to the credit agreement with an additional commitment lender. Pursuant to the joinder agreement, the amount of the revolving credit facility under the credit agreement was increased by $25.0 million to $592.6 million. Up to $350.0 million of the revolving credit facility is available for issuances of letters of credit.

        The term B-1 loans incurred in 2013 under the credit agreement are scheduled to mature on October 18, 2020, the term B-2 loans under the credit agreement are scheduled to mature on October 1, 2021 and the revolving credit facility under the credit agreement is scheduled to mature on October 18, 2018 (subject to accelerated maturity depending on our liquidity at the time our 2018 notes, 2020 notes and 2021 notes become due).

        The term B-1 loans and the term B-2 loans under the credit agreement amortize in equal quarterly installments in an amount equal to 1.00% per annum of the stated principal amount thereof, with the remaining balance due at final maturity.

        Interest on the term B-1 loans and the term B-2 loans is payable under the credit agreement at a rate equal to the eurodollar (LIBOR) rate or the base rate, plus an applicable margin, in each case, subject to a eurodollar (LIBOR) rate floor of 1.00% or a base rate floor of 2.00%, as applicable. The applicable margin for the term B-1 loans and the term B-2 loans under the credit agreement is 5.00% per annum for eurodollar (LIBOR) loans and 4.00% per annum for base rate loans. The initial

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applicable margin on eurodollar (LIBOR) rate borrowings under the revolving credit facility under the credit agreement is 3.00% per annum and may be reduced by 0.25% or 0.50% based on step downs tied to our net first lien leverage ratio.

        The Issuer is required to pay commitment fees to revolving lenders on the actual daily unused portion of the revolving commitments at a rate of 0.50% per annum through maturity, subject to a step down to 0.375% based upon the achievement of certain net first lien leverage ratios.

        The obligations under the credit agreement are guaranteed by the Company and each of the Company's direct and indirect wholly owned domestic subsidiaries (other than the Issuer), subject to certain customary exceptions as set forth in the credit agreement. In addition, the obligations under the credit agreement are secured by a first priority lien on (1) substantially all the property and assets (real and personal, tangible and intangible) of the Issuer, the Company and the other guarantors and (2) 100% of the capital stock (or other equity interests) of all of the Company's direct and indirect wholly owned domestic subsidiaries and 65% of the capital stock (or other equity interests) of the direct foreign subsidiaries of the Issuer and the guarantors, in each case, subject to certain customary exceptions as set forth in the credit agreement.

        The Issuer may voluntarily prepay all or any portion of outstanding amounts under the credit facilities at any time, in whole or in part, without premium or penalty, subject to (1) redeployment costs in the case of a prepayment of eurocurrency loans on a day that is not the last day of the relevant interest period and (2) a 1.00% prepayment premium on any prepaid term loans in connection with a repricing transaction occurring prior to November 21, 2015.

        The credit agreement contains customary mandatory prepayment provisions, subject to certain exceptions and reinvestment rights. The credit agreement generally requires mandatory prepayments of the term loans with the net cash proceeds from (1) the incurrence of indebtedness by us (excluding certain permitted debt), (2) the sale of assets (excluding certain permitted dispositions) and (3) any settlement of or payment in respect of any property or casualty insurance claim or any condemnation proceeding relating to any of our assets above a certain threshold.

        The credit agreement contains certain negative covenants that, among other things and subject to certain exceptions, restrict the Company's and its restricted subsidiaries' ability to incur additional debt or guarantees, grant liens on assets, make acquisitions or other investments, dispose of assets, prepay junior indebtedness or modify certain debt instruments, pay dividends or other payments on capital stock, consolidate or merge, enter into arrangements that restrict the ability to pay dividends, transfer assets or grant liens, enter into sale and leaseback transactions, enter into or consummate transactions with affiliates, or change fiscal year. The credit agreement contains customary events of default (subject to customary grace periods and materiality thresholds). Upon the occurrence of certain events of default, the obligations under the credit facilities may be accelerated and the commitments may be terminated.

        Under the credit agreement, we are required to maintain a Consolidated Net First Lien Leverage Ratio (as defined below) as of the last day of each fiscal quarter of no more than the applicable ratio set forth below:

Closing of Bally acquisition through December 31, 2015

    5.75:1.00  

January 1, 2016 through December 31, 2016

    5.50:1.00  

January 1, 2017 and thereafter

    5.00:1.00  

        "Consolidated Net First Lien Leverage Ratio" means, as of any date of determination, the ratio of (1) Consolidated Net First Lien Leverage (as defined below) on such date to (2) Consolidated EBITDA (as defined below) for the period of four consecutive fiscal quarters most recently ended on or prior to such day.

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        "Consolidated Net First Lien Leverage" means, as of any date, (1) the aggregate principal amount of all senior first-lien secured "funded debt" (defined generally as indebtedness for borrowed money, obligations evidenced by bonds (excluding surety bonds) debentures, notes or similar instruments, capital lease obligations, the principal component of all obligations in respect of bankers' acceptances, obligations to purchase, redeem, retire or defease "disqualified capital stock," and guarantee obligations relating to any of the foregoing, in each case, to the extent reflected as indebtedness on our balance sheet) on such date, minus (2) "unrestricted cash" (defined generally as the aggregate amount of cash and cash equivalents included in the cash accounts of our balance sheet to the extent such cash and cash equivalents are not (a) subject to liens (other than liens under the Credit Agreement or under any intercreditor agreement permitted by the credit agreement) or (b) classified as "restricted" (unless so classified solely because of any provision under the credit agreement or under any intercreditor agreement permitted by the credit agreement)) on such date.

        "Consolidated EBITDA" means, for any period, "consolidated net income" (generally our consolidated net income (or loss) excluding the income (or loss) of our equity investments except to the extent of dividends, return of capital or similar distributions actually received by us) for such period plus, without duplication and, if applicable, except with respect to clauses (9), (10), (16) and (19) below, to the extent deducted in calculating such consolidated net income for such period, the sum of:

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        Consolidated EBITDA is subject to certain pro forma adjustments in connection with material acquisitions and dispositions as provided in the credit agreement.

        Consolidated EBITDA also includes our pro rata share of the EBITDA of our joint ventures and minority equity investments (without duplication of amounts otherwise constituting consolidated net income, as noted above).

        The foregoing definitions are summary in nature and are qualified in their entirety by reference to the full text of such definitions contained in the credit agreement, a copy of which is attached as Exhibit 10.1 to Scientific Games Corporation's Current Report on Form 8 K filed with the SEC on October 18, 2013 and Amendment No. 1 to the Credit Agreement, a copy of which is attached as Exhibit 10.1 to Scientific Games Corporation's Current Report on Form 8 K filed with the SEC on October 7, 2014.

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        The Credit Agreement provides for additional refinancing flexibility in the form of (1) permitted bank debt or debt securities that may be unsecured or secured on a pari passu or junior basis with the collateral securing the obligations under the credit agreement and (2) replacement facilities under the credit agreement that can be used to refinance either the term loans or the revolving commitments under the credit agreement in whole. In addition, the Issuer will have the capability to request one or more additional tranches of term loans, increase the existing tranches of term loans, increase the revolving commitments and incur additional incremental indebtedness in the form of one or more series of debt securities in an aggregate amount equal to the sum of (1) $350.0 million and (2) in the event our Consolidated Net First Lien Leverage Ratio is equal to or less than 3.25 to 1.00, an additional unlimited amount. The Issuer may also increase the revolving commitments by an amount equal to the difference between $650.0 million and the aggregate commitments under the revolving credit facility as of the closing of the Bally acquisition.

        We were in compliance with our covenants under the Credit Agreement as of December 31, 2014.

2018 Subordinated Notes

        Our indebtedness includes $250.0 million in aggregate principal amount of the 2018 notes issued by the Company. The 2018 notes bear interest at the rate of 8.125% per annum, which is payable semiannually in arrears on March 15 and September 15 of each year. The 2018 notes mature on September 15, 2018, unless earlier redeemed or repurchased, and are subject to the terms and conditions set forth in the indenture governing the 2018 notes dated as of September 22, 2010 (the "2018 notes indenture"). The Company may redeem some or all of the 2018 notes for cash at any time at the prices specified in the 2018 notes indenture.

        Upon the occurrence of a change of control (as defined in the 2018 notes indenture), the Company must make an offer to purchase the 2018 notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase. In addition, following an asset sale (as defined in the 2018 notes indenture) and subject to the limitations contained in the 2018 notes indenture, the Company must make an offer to purchase certain amounts of the 2018 notes using the net cash proceeds from such asset sale to the extent such proceeds are not applied as set forth in the 2018 notes indenture, at a purchase price equal to 100% of the principal amount of the 2018 notes to be repurchased, plus accrued interest to the date of repurchase.

        The 2018 notes are unsecured senior subordinated obligations of the Company and are subordinated to all of the Company's existing and future senior debt, rank equally with all of the Company's future senior subordinated debt, and rank senior to all of the Company's future debt that is expressly subordinated to the 2018 notes. The 2018 notes are guaranteed on an unsecured senior subordinated basis by all of the Company's wholly owned domestic subsidiaries (including the Issuer). The 2018 notes are structurally subordinated to all of the liabilities of our non-guarantor subsidiaries.

        The 2018 notes indenture contains certain covenants that, among other things, limit the Company's ability, and the ability of certain of its subsidiaries, to incur additional indebtedness, pay dividends or make distributions or certain other restricted payments, purchase or redeem capital stock, make investments or extend credit, engage in certain transactions with affiliates, engage in sale-leaseback transactions, consummate certain asset sales, effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets, or create certain liens and other encumbrances on assets. The 2018 notes indenture contains events of default customary for agreements of its type (with customary grace periods, as applicable).

2020 Subordinated Notes

        Our indebtedness includes $300.0 million in aggregate principal amount of the 2020 notes issued by the Issuer. The 2020 notes bear interest at the rate of 6.25% per annum, which is payable

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semiannually in arrears on March 1 and September 1 of each year. The 2020 notes mature on September 1, 2020, unless earlier redeemed or repurchased, and are subject to the terms and conditions set forth in the indenture governing the 2020 notes dated as of August 20, 2012 (the "2020 notes indenture").

        The Issuer may redeem some or all of the 2020 notes at any time prior to September 1, 2015 at a price equal to 100% of the principal amount of the 2020 notes plus accrued and unpaid interest, if any, to the date of redemption plus a "make whole" premium calculated as set forth in the 2020 notes. The Issuer may redeem some or all of the 2020 notes for cash at any time on or after September 1, 2015 at the prices specified in the 2020 notes indenture.

        Upon the occurrence of a change of control (as defined in the 2020 notes indenture), the Issuer must make an offer to purchase the 2020 notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase. In addition, following an asset sale (as defined in the 2020 notes indenture) and subject to the limitations contained in the 2020 notes indenture, the Issuer must make an offer to purchase certain amounts of the 2020 notes using the net cash proceeds from such asset sale to the extent such proceeds are not applied as set forth in the 2020 notes indenture, at a purchase price equal to 100% of the principal amount of the 2020 notes to be repurchased, plus accrued interest to the date of repurchase.

        The 2020 notes are unsecured senior subordinated obligations of the Issuer and are subordinated to all of the Issuer's existing and future senior debt, rank equally with all of the Issuer's existing and future senior subordinated debt and rank senior to all of the Issuer's future debt that is expressly subordinated to the 2020 notes. The 2020 notes are guaranteed on an unsecured senior subordinated basis by the Company and all of its wholly owned domestic subsidiaries (other than the Issuer). The 2020 notes are structurally subordinated to all of the liabilities of our non-guarantor subsidiaries.

        The 2020 notes indenture contains certain covenants that, among other things, limit the Company's ability, and the ability of certain of its subsidiaries, including the Issuer, to incur additional indebtedness, pay dividends or make distributions or certain other restricted payments, purchase or redeem capital stock, make investments or extend credit, engage in certain transactions with affiliates, engage in sale-leaseback transactions, consummate certain asset sales, effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets, or create certain liens and other encumbrances on assets. The 2020 notes indenture contains events of default customary for agreements of its type (with customary grace periods, as applicable).

Secured Notes

        Our indebtedness includes $950.0 million in aggregate principal amount of the secured notes issued by the Issuer. The secured notes bear interest at the rate of 7.000% per annum, which is payable semiannually in arrears on January 1 and July 1 of each year. The Secured Notes mature on January 1, 2022, unless earlier redeemed or repurchased, and are subject to the terms and conditions set forth in the Secured Notes Indenture.

        The Issuer may redeem some or all of the Secured Notes at any time prior to January 1, 2018 at a price equal to 100% of the principal amount of the Secured Notes plus accrued and unpaid interest, if any, to the date of redemption plus a "make whole" premium calculated as set forth in the Secured Notes. The Issuer may redeem some or all of the Secured Notes for cash at any time on or after January 1, 2018 at the prices specified in the Secured Notes Indenture.

        Upon the occurrence of a change of control (as defined in the Secured Notes Indenture), the Issuer must make an offer to purchase the Secured Notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase. In addition, following an asset sale (as defined in the Secured Notes Indenture) and subject to the

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limitations contained in the Secured Notes Indenture, the Issuer must make an offer to purchase certain amounts of the Secured Notes using the net cash proceeds from such asset sale to the extent such proceeds are not applied as set forth in the Secured Notes Indenture, at a purchase price equal to 100% of the principal amount of the Secured Notes to be repurchased, plus accrued interest to the date of repurchase.

        The Secured Notes are senior secured obligations of the Issuer, equally and ratably secured with the Issuer's obligations under the credit agreement. The Secured Notes rank equally to all of the Issuer's existing and future senior debt and rank senior to all of the Issuer's existing and future senior subordinated debt. The Secured Notes are guaranteed on a senior secured basis by the Company and all of its wholly owned U.S. subsidiaries (other than the Issuer). The Secured Notes are structurally subordinated to all of the liabilities of the Company's non-guarantor subsidiaries.

        The Secured Notes Indenture contains certain covenants that, among other things, limit the Company's ability, and the ability of certain of its subsidiaries, including the Issuer, to incur additional indebtedness, pay dividends or make distributions or certain other restricted payments, purchase or redeem capital stock, make investments or extend credit, engage in certain transactions with affiliates, consummate certain asset sales, effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets, or create certain liens and other encumbrances on assets. The Secured Notes Indenture contains events of default customary for agreements of its type (with customary grace periods and maturity thresholds, as applicable).

Other Debt

        In September 2014, we repaid in full a $4.9 million China loan with cash on hand. As of December 31, 2014, we had $35.3 million of other debt, principally capital leases payable over 60 months with an implicit interest rate of 3.9%.

Surety Bonds

        As of December 31, 2014, we had arranged for the issuance of a total of $197.6 million of surety bonds in respect of outstanding contracts to which we and/or our subsidiaries are parties. We have reimbursement or indemnification obligations with respect to these bonds in the event that the sureties are required to make payment and, in some cases, such bonds are supported by springing liens, solely on those assets related to the performance of the relevant contractual obligations, that may attach following payment on such bonds.

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DESCRIPTION OF 2021 NEW NOTES

        The definitions of certain capitalized terms used in the following summary are set forth below under "—Certain Definitions." For purposes of this section, references to the "Company" include only Scientific Games Corporation and not its subsidiaries and references to the "Issuer" include only Scientific Games International, Inc. and not its subsidiaries or its parent company, Scientific Games Corporation.

        The 2021 old notes (as defined below) were, and the 2021 new notes (as defined below) will be, issued by the Issuer pursuant to an indenture, dated as of the Issue Date, by and among the Issuer, Scientific Games Corporation (the "Company"), the direct and indirect Wholly Owned Domestic Restricted Subsidiaries of the Company (other than the Issuer and certain Immaterial Subsidiaries) (together with the Company, the "guarantors") and Deutsche Bank Trust Company Americas, as trustee. On June 4, 2014, the Issuer issued and sold $350.0 million of 6.625% senior subordinated notes due 2021, or the 2021 old notes. Following the exchange offer, the 2021 new notes will trade as a single class of notes with the 2021 old notes. Unless indicated otherwise, the 2021 old notes and the 2021 new notes are collectively referred to in this "Description of 2021 New Notes" as the "notes" and the indenture governing the notes is referred to in this "Description of 2021 New Notes" as the "indenture." The form and terms of the 2021 new notes will be identical in all material respects to the form and term of the 2021 old notes, except that the terms of the 2021 new notes:

        The following summary of certain provisions of the indenture and the 2021 registration rights agreement is not complete and is qualified in its entirety by reference to the TIA, the indenture and the 2021 registration rights agreement. We urge you to read the indenture, the notes and the 2021 registration rights agreement because they, and not this description, define your rights as holders of the notes. You may request copies of these agreements at the Company's address set forth in the forepart of this prospectus. See "Where You Can Find More Information" and "Incorporation of Certain Documents by Reference."

Brief Description of the Notes

        The notes:

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Principal, Maturity and Interest

        The Issuer issued the 2021 old notes in an initial aggregate principal amount of $350.0 million. The 2021 old notes were issued in minimum denominations of $2,000 and any greater integral multiple of $1,000. The notes will mature on May 15, 2021. Interest on the notes will accrue at the rate of 6.625% per annum and will be payable semi-annually in cash on May 15 and November 15 of each year, with an initial interest payment on November 15, 2014. The Issuer will make each interest payment to the persons who are registered holders of notes at the close of business on the immediately preceding May 1 and November 1. Interest on the notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

        Initially, the trustee will act as paying agent and registrar for the notes. The Issuer may change any paying agent or registrar without notice to the holders of the notes. The Issuer will pay principal and premium, if any, on the notes at the trustee's corporate trust office in New York, New York. At the Issuer's option, interest may be paid at the trustee's corporate trust office in New York, New York or by check mailed to the registered address of holders of the notes.

Indenture May Be Used for Future Issuances

        Subject to compliance with the covenant described under the subheading "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock," the Issuer may issue more notes under the indenture on the same terms and conditions as the notes, except for issue date and issue price, in an unlimited aggregate principal amount (the "Additional Notes"). To the extent required by applicable tax regulations, Additional Notes may not trade fungibly with other notes for U.S. federal income tax purposes and may trade under a separate CUSIP number. The notes and the Additional Notes, if any, will be treated as a single class for all purposes of the indenture, including waivers, amendments, redemptions and offers to purchase. Unless the context otherwise requires, for all purposes of the indenture and this "Description of 2021 New Notes," references to the notes include any Additional Notes actually issued.

Redemption

        Optional Redemption.    On and after May 15, 2017, the Issuer will be entitled, at its option on one or more occasions, to redeem all or any portion of the notes at the following redemption prices (expressed as percentages of the principal amount thereof) if redeemed during the 12-month period commencing on May 15 of the years set forth below, plus, in each case, accrued and unpaid interest to, but not including, the date of redemption subject to the rights of holders of notes on the relevant record dates occurring prior to the redemption date to receive interest due on the relevant interest payment date:

Period
  Percentage
 

2017

    104.969 %

2018

    103.313 %

2019

    101.656 %

2020 and thereafter

    100.000 %

        Optional Redemption Upon Equity Offering.    Prior to May 15, 2017, the Issuer may, at its option on one or more occasions, redeem up to 35% of the initially outstanding aggregate principal amount of the notes (which includes Additional Notes, if any) so long as such aggregate principal amount does not exceed the amount of net cash proceeds received by, or contributed to the capital of, the Company from one or more Equity Offerings, at a redemption price equal to 106.625% of the principal amount thereof, plus accrued and unpaid interest to, but not including, the date of redemption subject to the

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rights of holders of notes on the relevant record dates occurring prior to the redemption date to receive interest due on the relevant interest payment date; provided, however, that:

        Redemption at Make-Whole Premium.    At any time prior to May 15, 2017, the Issuer may redeem all or any portion of the notes on one or more occasions at a redemption price equal to 100% of the principal amount of notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, the date of redemption subject to the rights of holders of the notes on the relevant record dates occurring prior to the redemption date to receive interest due on the relevant interest payment date.

        Regulatory Redemption.    If at any time any holder or beneficial owner of notes is determined to be or otherwise is or becomes a Disqualified Holder, then the Issuer will have the right, at its option:

together with, in the case of either clause (a) or (b), accrued and unpaid interest to the earlier of (A) the date of redemption and (B) the date of the denial of license or qualification or of the finding of unsuitability by such Gaming Authority (or the date such holder or beneficial owner otherwise becomes a Disqualified Holder) (subject to the rights of holders of the notes on the relevant record dates occurring prior to such redemption date to receive interest due on the relevant interest payment date); provided, however, that if such Gaming Authority restricts the redemption price to a lesser amount, then such lesser amount will be the redemption price.

        Immediately upon a determination by a Gaming Authority that a holder or beneficial owner of notes (or an Affiliate thereof) will not be licensed, qualified or found suitable or is denied a license, qualification or finding of suitability or otherwise becomes a Disqualified Holder, the holder or beneficial owner will, to the extent required by applicable Gaming Laws, have no further rights with respect to the notes to:

        The Issuer will notify the trustee in writing of any such redemption as soon as practicable. The holder or beneficial owner (or an Affiliate thereof) applying for a license, qualification or a finding of suitability must pay all costs of the licensure or investigation for such qualification or finding of suitability.

        Mandatory Redemption.    The Issuer is not required to make mandatory redemption or sinking fund payments with respect to the notes.

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Selection and Notice

        In the event that less than all of the notes are to be redeemed at any time (other than in the case of a regulatory redemption), the trustee will select the notes or portions thereof to be redeemed among the holders of the notes as follows:

        The Issuer will redeem notes of $2,000 or less in whole and not in part. Notes in a principal amount in excess of $2,000 may be redeemed in part in multiples of $1,000 only. Notice of redemption will be delivered electronically in pdf format or sent, by first class mail, postage prepaid, at least 30 days and not more than 60 days before the redemption date to each holder of notes to be redeemed at its registered address, except that redemption notices may be delivered electronically in pdf format or mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the notes or a satisfaction and discharge of the indenture.

        If any note is to be redeemed in part only, the notice of redemption that relates to such note will state the portion of the principal amount of the note to be redeemed. A new note in principal amount equal to the unredeemed portion of the note will be issued in the name of the holder thereof upon cancellation of the original note. On and after any redemption date, interest will cease to accrue on the notes or parts thereof called for redemption as long as the Issuer has deposited with the paying agent funds in satisfaction of the redemption price pursuant to the indenture.

        In connection with any redemption of notes (including in any redemption described under "—Optional Redemption"), any such redemption may, at the Issuer's discretion, be subject to one or more conditions precedent, including any related Equity Offering or a Change of Control. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Issuer's discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied or waived, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied or waived by the redemption date, or by the redemption date so delayed.

Ranking

Senior Indebtedness versus Notes

        The payment of the principal of, premium, if any, and interest on the notes and the payment of any guarantee of the notes will be subordinated in right of payment to the prior payment in full of all Senior Debt of the Issuer or the relevant guarantor, as the case may be, including the obligations of the Issuer and such guarantor under the Credit Agreement and the secured notes.

        As of December 31, 2014, the Senior Debt of the Issuer and the guarantors totaled approximately $7,844.9 million, including (1) approximately $5,412.0 million of secured Senior Debt (which excludes approximately $41.0 million of outstanding letters of credit) under the Credit Agreement and the secured notes, (2) $2,200 million in aggregate principal amount of the 2022 old notes and (3) approximately $197.6 million of outstanding surety bonds and $35.3 million of capital lease obligations, and the Issuer had approximately $341.6 million of additional availability under the Credit Agreement that the Company and the guarantors would guarantee (all of which would be secured).

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        Although the indenture contains limitations on the amount of additional Indebtedness that the Issuer and the guarantors may incur, under certain circumstances the amount of such Indebtedness could be substantial and, in any case, such Indebtedness may be Senior Debt. See "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock." Additionally, all of the existing Senior Debt, other than the 2022 old notes and outstanding surety bonds and capital lease obligations, of the Issuer and the guarantors is currently secured by Liens and, as a result, the notes and the guarantees are also effectively subordinated to such Indebtedness to the extent of the value of the assets pledge to secure such Indebtedness.

Liabilities of Subsidiaries versus Notes

        Substantially all of the Company's operations are conducted through its subsidiaries. The Company and its direct and indirect Wholly Owned Domestic Restricted Subsidiaries (other than the Issuer and certain Immaterial Subsidiaries) will initially guarantee the notes and the indenture, and the guarantees of such subsidiaries may be released, as described below under "—Guarantees." Claims of creditors of the Company's non-guarantor subsidiaries, including trade creditors and creditors holding indebtedness or guarantees issued by such non-guarantor subsidiaries, and claims of preferred stockholders of such non-guarantor subsidiaries generally will have priority with respect to the assets and earnings of the non-guarantor subsidiaries over the claims of the Issuer's creditors, including holders of the notes, even if such claims do not constitute Senior Debt. Accordingly, the notes will be structurally subordinated to creditors (including trade creditors) and preferred stockholders, if any, of the non-guarantor subsidiaries.

        As of December 31, 2014, the Company's non-guarantor subsidiaries had outstanding total third-party liabilities of approximately $270.8 million, including trade payables, and no preferred shares.

        Although the indenture limits the incurrence of Indebtedness and preferred stock of certain of the Company's subsidiaries, such limitation is subject to a number of significant qualifications. Moreover, the indenture does not impose any limitation on the incurrence by such subsidiaries of liabilities that are not considered Indebtedness under the indenture. See "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock."

Other Senior Subordinated Indebtedness versus Notes

        Only Indebtedness of the Issuer or a guarantor that is Senior Debt ranks senior in right of payment to the notes or the relevant guarantee in accordance with the provisions of the indenture. The notes and the guarantees will in all respects rank pari passu in right of payment with all other senior subordinated indebtedness of the Issuer or the relevant guarantor, as the case may be, including the Existing Senior Subordinated Notes and the guarantees thereof.

        As of December 31, 2014, the Issuer and the guarantors had $550.0 million of outstanding senior subordinated indebtedness that ranks equally in right of payment with the notes and the guarantees, all of which was issued or guaranteed, as applicable, on a senior subordinated basis by the Issuer and the guarantors of the notes.

        The Issuer and the guarantors agreed in the indenture that they will not incur any Indebtedness that is subordinate or junior in right of payment to the Issuer's Senior Debt or the Senior Debt of such guarantor, as applicable, unless such Indebtedness is senior subordinated indebtedness of the Issuer or the guarantors, as applicable, or is expressly subordinated in right of payment to senior subordinated indebtedness of the Issuer or the guarantors, as applicable. The indenture does not treat (1) unsecured Indebtedness as subordinated or junior in right of payment to secured Indebtedness merely because it is unsecured or (2) Senior Debt as subordinated or junior in right of payment to any other Senior Debt merely because it has a junior priority with respect to the same collateral.

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Payment of Notes

        We may not make any payments (or make any deposit pursuant to the provisions described under "—Defeasance") on the notes (except that holders of notes may receive and retain payments made from the trust described under "—Defeasance") if:

        Payments on the notes will be resumed

        No nonpayment default that existed or was continuing on the date of delivery of any payment blockage notice to the trustee shall be, or be made, the basis for a subsequent payment blockage notice.

        Upon any payment or distribution of the assets of the Issuer upon a total or partial liquidation or dissolution or reorganization of or similar proceeding relating to the Issuer or its property:

        The subordination and payment blockage provisions described above will not prevent a default from occurring under the indenture upon the failure of the Issuer to pay interest or principal with respect to the notes when due by their terms. If payment of the notes is accelerated because of an Event of Default, the Issuer or the trustee must promptly notify the holders of Designated Senior Debt of the Issuer or the representative of such Designated Senior Debt of the acceleration.

        A guarantor's obligations under its guarantee are senior subordinated obligations. As such, the rights of holders of notes to receive payment by a guarantor pursuant to its guarantee will be subordinated in right of payment to the rights of holders of Senior Debt of such guarantor. The terms of the subordination and payment blockage provisions described above with respect to the Issuer's obligations under the notes apply equally to a guarantor and the obligations of such guarantor under its guarantee.

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        As a result of the subordination provisions described above, in the event of a liquidation or insolvency proceeding, creditors of the Issuer or a guarantor who are holders of Senior Debt of the Issuer or a guarantor, as the case may be, may recover more, ratably, than the holders of the notes, and creditors of ours who are not holders of Senior Debt may recover less, ratably, than holders of Senior Debt and may recover more, ratably, than the holders of the notes.

        The terms of the subordination provisions described above will not apply to payments from money or the proceeds of U.S. Government Obligations held in trust by the trustee for the payment of principal of and interest on the notes pursuant to the provisions described under "—Defeasance."

Guarantees

        The guarantors jointly and severally guaranteed, on a senior subordinated basis, the Issuer's performance of its obligations under the notes and the indenture, including the payment of principal with respect to the notes. The guarantors currently consist of the Company and all of the Company's direct and indirect Wholly Owned Domestic Restricted Subsidiaries (other than the Issuer and certain Immaterial Subsidiaries).

        The guarantees are subordinated in right of payment to Senior Debt of the relevant guarantor on the same basis as the notes are subordinated in right of payment to Senior Debt of the Issuer. The obligations of each guarantor (other than the obligations of the Company under its guarantee) are limited as necessary to prevent such guarantee from constituting a fraudulent conveyance or fraudulent transfer under federal or state law. Each guarantor (other than the Company) that makes a payment or distribution under a guarantee will be entitled to a contribution from each other guarantor in an amount pro rata, based on the net assets of each guarantor (other than the Company), determined in accordance with GAAP.

        Each guarantor may consolidate with or merge into or sell its assets to the Company, the Issuer or another Restricted Subsidiary of the Company without limitation, or with other persons upon the terms and conditions set forth in the indenture. See "—Covenants—Merger, Consolidation and Sale of Assets." In the event the Capital Stock of a guarantor (other than the Company) is sold or otherwise disposed of, by merger or otherwise, by the Company or any of its subsidiaries to any person that is not a guarantor, or as a result of such sale or disposition the applicable guarantor is no longer a Restricted Subsidiary, and the sale or disposition is not in violation of the provisions set forth in "—Covenants—Limitation on Asset Sales," such guarantor's guarantee will be released and such guarantor shall be relieved of all of its obligations and duties under the indenture and the notes. A guarantor's guarantee (other than the guarantee by the Company) will also be released and such guarantor will also be released from all obligations and duties under the indenture and the notes as described below under "—Covenants—Limitation on Guarantees by Restricted Subsidiaries."

Registration Rights

        The Issuer, the Company and the other guarantors entered into the 2021 registration rights agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the initial purchasers of the 2021 old notes, on the Issue Date. In that agreement, the Issuer and the guarantors agreed for the benefit of the holders of the 2021 old notes that they will use their commercially reasonable efforts to file with the SEC and to cause to become effective, a registration statement relating to an offer to exchange the 2021 old notes for an issue of SEC-registered notes (the "2021 new notes") with terms identical to the 2021 old notes (except that the 2021 new notes will not be subject to restrictions on transfer or to any increase in annual interest rate as described below).

        Promptly after the SEC declares the exchange offer registration statement effective, the Issuer will offer the 2021 new notes in return for the 2021 old notes. The exchange offer will remain open for at least 20 business days after the date the Issuer mails notice of the exchange offer to holders. For each

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2021 old note surrendered to the Issuer under the exchange offer, the holder will receive a new note of equal principal amount. Interest on each 2021 new note will accrue from the last interest payment date on which interest was paid on the notes or, if no interest has been paid on the notes, from the Issue Date. If applicable interpretations of the staff of the SEC do not permit the Issuer to effect the exchange offer, the Issuer will use its commercially reasonable efforts to cause to become effective a shelf registration statement relating to resales of the notes and to keep that shelf registration statement effective until the first anniversary of the date such shelf registration statement becomes effective, or such shorter period that will terminate when all notes covered by the shelf registration statement have been sold. The Issuer will, in the event of such a shelf registration, provide to each holder copies of a prospectus, notify each holder when the shelf registration statement has become effective and take certain other actions to permit resales of the notes. A holder that sells notes under the shelf registration statement generally will be required to be named as a selling security holder in the related prospectus and to deliver a prospectus to purchasers, will be subject to certain of the civil liability provisions under the Securities Act in connection with those sales and will be bound by the provisions of the 2021 registration rights agreement that are applicable to such a holder (including certain indemnification obligations). The obligation to complete the exchange offer and/or file a shelf registration statement will terminate on the second anniversary of the date of the 2021 registration rights agreement.

        If the exchange offer is not completed (or, if required, the shelf registration statement is not declared effective) on or before the date that is 365 days after the Issue Date (provided that, if the Company determines in good faith that it is in possession of material non-public information, it may extend either such date by up to 90 additional days under customary "blackout" provisions), the annual interest rate borne by the notes will be increased by 0.25% per annum for the first 90-day period immediately following such date and by an additional 0.25% per annum with respect to each subsequent 90-day period, up to a maximum additional rate of 1.0% per annum thereafter until the exchange offer is completed, the shelf registration statement is declared effective or the obligation to complete the exchange offer and/or file the shelf registration statement terminates, as applicable, at which time the interest rate will revert to the original interest rate on the Issue Date.

        If the Issuer effects the exchange offer, it will be entitled to close the exchange offer 20 business days after its commencement; provided that the Issuer has accepted all 2021 old notes validly surrendered in accordance with the terms of the exchange offer. 2021 old notes not tendered in the exchange offer will bear interest at the rate set forth on the cover page of this prospectus and will be subject to all the terms and conditions specified in the indenture, including transfer restrictions.

Change of Control

        Upon the occurrence of a Change of Control Repurchase Event, each holder will have the right to require that the Issuer repurchase all or a portion (in integral multiples of $1,000; provided that the Issuer will repurchase notes of $2,000 or less in whole and not in part) of such holder's notes, at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the date of repurchase.

        Prior to the mailing of the notice described in the next paragraph below, but in any event within 60 days following any Change of Control Repurchase Event, the Company and the Issuer covenant to

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        The Company and the Issuer shall first comply with the covenant in the immediately preceding sentence before the Issuer shall be required to repurchase notes pursuant to the provisions described below. The Company's or the Issuer's failure to comply with this covenant shall constitute an Event of Default described in clause (3) and not in clause (2) under "Events of Default" below.

        Within 30 days following the date upon which the Change of Control Repurchase Event occurred, the Issuer will send, electronically or by first class mail, a notice to each holder, with a copy to the trustee, offering to purchase the notes as described above (the "Change of Control Offer"). The notice will state, among other things, the payment date, which must be no earlier than 30 days nor later than 60 days from the date such notice is mailed (other than as may be required by law).

        The Issuer will not be required to make a Change of Control Offer upon a Change of Control Repurchase Event if (a) a third party makes the Change of Control Offer in the manner, at the time and otherwise in compliance with the requirements set forth in the indenture applicable to a Change of Control Offer made by the Issuer and purchases all notes properly tendered and not withdrawn under the Change of Control Offer or (b) a notice of redemption relating to the redemption of all of the notes has been given pursuant to the indenture as described above under the caption "—Optional Redemption" and, in the event that such redemption is subject to one or more conditions precedent, such conditions have been satisfied or waived. Notwithstanding anything to the contrary contained in the indenture, a Change of Control Offer may be made in advance of a Change of Control Repurchase Event, conditioned upon the consummation of such Change of Control Repurchase Event, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made. The closing date of any such Change of Control Offer made in advance of a Change of Control Repurchase Event may be changed to conform to the actual closing date of the Change of Control Repurchase Event, provided that such closing date is not earlier than 30 days nor later than 60 days from the date the Change of Control Offer notice is mailed as described in the paragraph above. Additionally, the Company may, at its option, include in any Change of Control Offer an early tender payment, early consent payment or consent payment, so long as any such payment is in addition to the purchase price set forth in the initial paragraph of this section.

        If holders of not less than 90% in aggregate principal amount of the outstanding notes validly tender and do not withdraw such notes in a Change of Control Offer and the Issuer, or any third party making a Change of Control Offer in lieu of the Issuer as described above, purchases all of the notes validly tendered and not withdrawn by such holders, the Issuer or such third party will have the right, upon not less than 30 days nor more than 60 days' prior notice, given not more than 30 days following such purchase pursuant to the Change of Control Offer described above, to redeem all notes that remain outstanding following such purchase at a price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest to, but not including, the date of redemption.

        The occurrence of a Change of Control or a Change of Control Repurchase Event may constitute a default under the Credit Agreement and any other Credit Facility we may enter into from time to time. Our future Senior Debt may contain prohibitions of certain events that would constitute a Change of Control or a Change of Control Repurchase Event or require such Senior Debt to be repurchased or repaid upon a Change of Control or a Change of Control Repurchase Event. Moreover, the exercise by the holders of their right to require the Issuer to purchase the notes could cause a default under such Senior Debt, even if the Change of Control or the Change of Control Repurchase Event itself does not, due to the financial effect of such repurchase on the Issuer. Finally, the Issuer's ability to pay cash to the holders upon a purchase may be limited by the Issuer's then existing financial resources. There can be no assurance that sufficient funds will be available when necessary to make required purchases. The provisions under the indenture relative to the Issuer's obligation to make an

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offer to purchase the notes as a result of a Change of Control Repurchase Event may be waived or modified prior to the occurrence of a Change of Control Repurchase Event with the written consent of the holders of a majority in principal amount of the notes.

        The Company and the Issuer will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of notes pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the "Change of Control" provisions of the indenture, the Company and the Issuer shall comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations under the "Change of Control" provisions of the indenture by virtue thereof.

Covenants

        Set forth below are summaries of certain covenants that will be contained in the indenture.

Suspension of Covenants on Achievement of Investment Grade Status

        Following the first day that:

then, beginning on that day and continuing until the Reversion Date (as defined below), the Company and its Restricted Subsidiaries will not be subject to the provisions of the indenture summarized under the following headings (collectively, the "Suspended Covenants"):

        If at any time (a)(i) the notes cease to have such Investment Grade Status and/or (ii) the Issuer or any of its Affiliates enters into an agreement to effect a transaction and one or more of the Rating Agencies indicate that if consummated, that transaction (alone or together with any related recapitalization or refinancing transactions) would cause that Rating Agency to withdraw its Investment Grade Status for such notes or downgrade the ratings assigned to such notes below an Investment Grade Status or (b) if a Default or Event of Default occurs and is continuing, then the Suspended Covenants will thereafter be reinstated under the indenture as if such covenants had never been suspended (the "Reversion Date") and be applicable pursuant to the terms of the indenture (including in connection with performing any calculation or assessment to determine compliance with the terms of the indenture), unless and until the notes subsequently attain Investment Grade Status and no Default or Event of Default is in existence (in which event the Suspended Covenants shall no longer be in effect for such time that the notes maintain an Investment Grade Status and no Default or Event of Default is in existence); provided, however, that no Default, Event of Default or breach of any kind shall be deemed to exist under the indenture, the notes or the guarantees with respect to the Suspended Covenants based on, and none of the Issuers or any of their Subsidiaries shall bear any

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liability for, any actions taken or events occurring during the Suspension Period (as defined below), or any actions taken at any time pursuant to any contractual obligation arising prior to the Reversion Date, regardless of whether such actions or events would have been permitted if the applicable Suspended Covenants remained in effect during such period. The period of time between the date of suspension of the covenants and the Reversion Date is referred to as the "Suspension Period."

        On the applicable Reversion Date (i) all Indebtedness Incurred or Preferred Stock issued during such Suspension Period will be classified to have been incurred or issued pursuant to clause (3) of the definition of "Permitted Indebtedness," (ii) after any Reversion Date calculations of the amount available to be made as Restricted Payments under the caption "—Limitation on Restricted Payments" will be calculated as though the covenant described under the caption "—Limitation on Restricted Payments" had been in effect since the Issue Date and throughout the Suspension Period, (iii) any Affiliate Transaction entered into after the applicable Reversion Date pursuant to an agreement entered into during such Suspension Period shall be deemed to be permitted pursuant to clause (5) of the second paragraph under the caption of "—Limitation on Transactions with Affiliates," and (iv) purposes of the covenant described under "—Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries," all contracts entered into during the Suspension Period prior to such Reversion Date that contain any of the restrictions contemplated by such covenant will be deemed to have been entered pursuant to clause (2) of the second paragraph of "—Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries." No Subsidiary may be designated as an Unrestricted Subsidiary during the Suspension Period, unless such designation would have complied with the covenant described under "—Limitation on Restricted Payments" as if such covenant were in effect during such period. In addition, during the Suspension Period, the obligation to grant further guarantees will be suspended. Upon the Reversion Date, the obligation to grant guarantees will be reinstated.

        The Company shall provide an Officer's Certificate to the trustee indicating the commencement of any Suspension Period or the Reversion Date. The trustee will have no obligation to (i) independently determine or verify if such events have occurred, (ii) make any determination regarding the impact of actions taken during the Suspension Period on the Company and its Restricted Subsidiaries' future compliance with their covenants or (iii) notify the holders of the commencement of the Suspension Period or the Reversion Date.

        There can be no assurance that the notes will ever achieve or maintain Investment Grade Status.

Limitation on Restricted Payments

        The Company will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly,

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(each of the foregoing actions set forth in clauses (a), (b) and (c) being referred to as a "Restricted Payment"), if at the time of such Restricted Payment, or immediately after giving effect thereto,

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provided, that any amount pursuant to this clause (z) shall only be included in the calculation required by clause (3) above to the extent that such amount is not included in the Company's Consolidated Net Income.

        Notwithstanding the foregoing, the provisions set forth in the immediately preceding paragraph shall not prohibit

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        In determining the aggregate amount of Restricted Payments made subsequent to August 20, 2012 in accordance with clause (3) of the immediately preceding paragraph, amounts expended (to the

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extent such expenditure is in the form of cash) pursuant to clauses (1), (2)(b) and (7) of this paragraph will be included in such calculation.

Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock

        The Company will not, and will not permit any of its Restricted Subsidiaries to, incur any Indebtedness other than Permitted Indebtedness and will not permit any of its Restricted Subsidiaries to issue any Preferred Stock other than Permitted Indebtedness; provided, however, that if no Default or Event of Default shall have occurred and be continuing at the time or as a consequence of the incurrence of any such Indebtedness, the Company or any Restricted Subsidiary may incur Indebtedness and any of the Restricted Subsidiaries may issue Preferred Stock if, on the date of the incurrence of such Indebtedness or issuance of such Preferred Stock, after giving effect to the incurrence or issuance thereof, the Consolidated Fixed Charge Coverage Ratio of the Company is equal to or greater than 2.0 to 1.0.

        For purposes of determining compliance with this "Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock" covenant, in the event that an item of Indebtedness or Preferred Stock meets the criteria of more than one of the categories of Permitted Indebtedness described in the definition of "Permitted Indebtedness," or is entitled to be incurred or issued, as the case may be, pursuant to the first paragraph of this covenant, the Company, in its sole discretion, will be permitted to classify such item of Indebtedness or Preferred Stock on the date of its incurrence or issuance, as the case may be, in any manner that complies with this covenant, or later divide, classify or reclassify (based on circumstances existing at the time of such division, classification or reclassification) all or a portion of such item of Indebtedness or Preferred Stock in any manner that complies with this covenant and such item of Indebtedness or Preferred Stock (or portion thereof, as applicable) will be treated as having been incurred or issued, as the case may be, pursuant to only such clause or clauses or the first paragraph of this covenant. Indebtedness under the Credit Agreement outstanding on the date on which notes are first issued and authenticated under the indenture will initially be deemed to have been incurred on such date in reliance on the exception provided by clause (2) of the definition of Permitted Indebtedness.

        Neither the Issuer nor any guarantor will, directly or indirectly, in any event incur any Indebtedness that, by its terms or by the terms of any agreement governing such Indebtedness, is both subordinated pursuant to its terms in right of payment to any other Indebtedness of the Issuer or such guarantor, as the case may be, and senior in right of payment to the notes or any such guarantor's guarantee, as the case may be.

Limitation on Transactions with Affiliates

        The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or permit to exist any transaction or series of related transactions with any of its Affiliates (an "Affiliate Transaction") involving aggregate consideration in excess of $10.0 million, other than

provided, however, that for a transaction or series of related transactions with an aggregate value exceeding the greater of $40.0 million and 1% of the Company's Total Assets, such determination shall be made in good faith by a majority of the disinterested members of the board of the directors of the

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Company; and provided, further, that for a transaction or series of related transactions with an aggregate value of $75.0 million or more,

        The foregoing restrictions will not apply to:

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Limitation on Liens

        The Issuer and the Company will not, and the Company will not permit any of the other guarantors to, directly or indirectly, create, incur or assume any Lien securing Indebtedness (other than Permitted Liens) upon any property or asset now owned or hereafter acquired by them, or any income or profits therefrom, or assign or convey any right to receive income therefrom; provided, however, that in addition to creating Permitted Liens on their properties or assets, the Issuer, the Company and any of the other guarantors may create any Lien securing Indebtedness upon any of their properties or assets (including, but not limited to, any Capital Stock of its subsidiaries) if the notes are equally and ratably secured.

Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries

        The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:

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except for such encumbrances or restrictions existing under or by reason of:

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Merger, Consolidation and Sale of Assets

        Neither the Company nor the Issuer will, in a single transaction or series of related transactions, consolidate or merge with or into any person, or sell, assign, transfer, lease, convey or otherwise dispose of (or cause or permit any Restricted Subsidiary of the Company to sell, assign, transfer, lease, convey or otherwise dispose of) all or substantially all of the Company's assets (determined on a consolidated basis for the Company and its Restricted Subsidiaries) whether as an entirety or substantially as an entirety to any person unless:

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        For purposes of the foregoing, the transfer, by lease, assignment, sale or otherwise, in a single transaction or series of transactions, of all or substantially all of the properties or assets of one or more Restricted Subsidiaries of the Company, other than to a Wholly Owned Restricted Subsidiary of the Company, the Capital Stock of which constitutes all or substantially all of the properties and assets of the Company, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company.

        The indenture provides that upon any consolidation, combination or merger or any transfer of all or substantially all of the assets of the Company or the Issuer, as applicable, in accordance with the foregoing, in which the Company or the Issuer, as applicable, is not the continuing person, the successor person formed by such consolidation or into which the Company or the Issuer, as applicable, is merged or to which such conveyance, lease or transfer is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company or the Issuer, as applicable, under the indenture and the notes with the same effect as if such Surviving Entity had been named as such and the Company or the Issuer, as applicable, shall be relieved of all of its obligations and duties under the indenture and the notes.

        Each guarantor (other than the Company), other than any guarantor whose guarantee is to be released in accordance with the terms of the guarantee and the indenture, will not, and the Company will not cause or permit any such guarantor to, consolidate with or merge with or into any person other than the Company, the Issuer or any other guarantor unless:

        Any merger or consolidation of a guarantor (other than the Company) with and into the Company or the Issuer, with the Company or the Issuer being the Surviving Entity, or another guarantor that is a Wholly Owned Restricted Subsidiary of the Company need not comply with this covenant.

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Limitation on Asset Sales

        The Company will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:

provided that the 75% limitation referred to above will not apply to any sale, transfer or other disposition of assets in which the cash portion of the consideration received therefor is equal to or greater than what the after-tax net proceeds would have been had such transaction complied with the aforementioned 75% limitation. On the 366th day after an Asset Sale (or the 181st day after the entry

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into a binding commitment to reinvest) or such earlier date, if any, as the Company in good faith determines not to apply an amount equal to the Net Cash Proceeds relating to such Asset Sale as set forth in clause (3) of the preceding sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash Proceeds that have not been so applied on or before such Net Proceeds Offer Trigger Date as permitted in clause (3)) of the preceding sentence (each, a "Net Proceeds Offer Amount") the Issuer will make an offer to repurchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer Payment Date") not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date (or such longer period as may be required by law), from all holders, that amount of notes equal to the aggregate amount of Net Cash Proceeds that have not been so applied on or before such Net Proceeds Offer Trigger Date as permitted in clause (3) of the preceding sentence multiplied by a fraction, the numerator of which is the aggregate principal amount of notes then outstanding and the denominator of which is the sum of the aggregate principal amount of notes and Pari Passu Indebtedness then outstanding (the "Pro Rata Amount"), at a price equal to 100% of the principal amount of the notes to be repurchased, plus accrued interest to the date of repurchase.

        Notwithstanding the foregoing, if a Net Proceeds Offer Amount is less than $50.0 million, the application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all Asset Sales by the Company and its Restricted Subsidiaries aggregates at least $50.0 million, at which time the Issuer will apply all Net Cash Proceeds constituting all Net Proceeds Offer Amounts that have been so deferred to make a Net Proceeds Offer, the first date the aggregate of all such deferred Net Proceeds Offer Amounts is at least $50.0 million being deemed to be a Net Proceeds Offer Trigger Date. To the extent that the aggregate purchase price of notes tendered pursuant to any Net Proceeds Offer is less than the Pro Rata Amount, the Issuer or any guarantor may use such amount for any purpose not prohibited by the indenture. Upon completion of any Net Proceeds Offer, the Net Proceeds Offer Amount shall be reset to zero.

        The Credit Agreement restricts the ability of the Issuer to repurchase the notes, subject to certain exceptions. Accordingly, if required to make a Net Proceeds Offer, the Issuer may need the consent of the lenders under the Credit Agreement. The failure of the Issuer to make a required Net Proceeds Offer and repurchase notes subject thereto would be an Event of Default.

        Notwithstanding the first two paragraphs of this covenant, the Company and its Restricted Subsidiaries will be permitted to consummate an Asset Sale without complying with such paragraphs to the extent

        In the event of the transfer of substantially all, but not all, of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a person in a transaction permitted under the "—Merger, Consolidation and Sale of Assets" covenant, the successor corporation will be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this covenant, and will comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the fair market value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold will be deemed to be Net Cash Proceeds for purposes of this covenant.

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        Notice of a Net Proceeds Offer will be mailed to the holders as shown on the register of holders not less than 30 days nor more than 60 days before the payment date for the Net Proceeds Offer, with a copy to the trustee, and will comply with the procedures set forth in the indenture. Upon receiving notice of the Net Proceeds Offer, holders may elect to tender their notes in whole or in part (in integral multiples of $1,000 principal amount; provided that the Issuer will repurchase notes of $2,000 or less in whole and not in part) at maturity in exchange for cash. To the extent holders properly tender notes in an amount exceeding the Net Proceeds Offer Amount, the trustee will select the notes or portions thereof to be repurchased among the holders of the notes as follows:

        A Net Proceeds Offer shall remain open for a period of 20 Business Days or such longer period as may be required by law.

        If an offer is made to repurchase the notes pursuant to a Net Proceeds Offer, the Company will and will cause its Restricted Subsidiaries to comply with all tender offer rules under state and federal securities laws, including, but not limited to, Section 14(e) under the Exchange Act and Rule 14e-1 thereunder, to the extent applicable to such offer.

Limitation on Guarantees by Restricted Subsidiaries

        The Company will not permit any Wholly Owned Domestic Restricted Subsidiary or any non-Wholly Owned Domestic Restricted Subsidiary that guarantees capital markets debt securities (other than the Issuer, a guarantor or an Immaterial Subsidiary) to, directly or indirectly, by way of the pledge of any intercompany note or otherwise, to assume, guarantee or in any other manner become liable with respect to any Indebtedness of the Company or the Issuer, other than

unless, in any such case

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        Any guarantee of the notes by a Restricted Subsidiary will provide by its terms that it will be automatically and unconditionally released and discharged, without any further action required on the part of the trustee or any holder, upon:

provided that any Restricted Subsidiary that constitutes an Immaterial Subsidiary need not become a guarantor until such time as it ceases to be an Immaterial Subsidiary, within 10 Business Days of which it shall provide a guarantee as contemplated by subparagraph (4)(a) above; and provided, further, that if, at the end of the most recent fiscal year for which internal financial statements are then available, all Immaterial Subsidiaries, in the aggregate, have total assets as of the end of the most recent fiscal year for which internal financial statements are then available in excess of 7.5% of the Company's Total Assets and Total Revenues as of the end of the most recent fiscal year for which internal financial statements are then available in excess of 7.5% of the Company's Total Revenues, one or more of such subsidiaries shall, within 10 Business Days of such internal financial statements becoming available, provide a guarantee so that in the aggregate the total assets of all Immaterial Subsidiaries that are not guarantors as of the end of such fiscal year are not in excess of 7.5% of the Company's Total Assets and their Total Revenues as of the end of the most recent fiscal year for which internal financial statements are then available are not in excess of 7.5% of the Company's Total Revenues.

Events of Default

        The following events are defined in the indenture as "Events of Default":

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        During the continuance of any Event of Default specified in the indenture (other than an Event of Default with respect to bankruptcy proceedings of the Company or the Issuer), the trustee or the holders of at least 25% in principal amount of outstanding notes may declare the principal of and accrued interest on all the notes to be due and payable by notice in writing to the Issuer and the trustee specifying the respective Event of Default and that it is a "notice of acceleration," and the same will become immediately due and payable. If an Event of Default with respect to bankruptcy proceedings of the Company or the Issuer occurs and is continuing, then such amount shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the trustee or any holder of notes.

        The indenture provides that, at any time after a declaration of acceleration with respect to the notes as described in the preceding paragraph, the holders of a majority in principal amount of the notes may rescind and cancel such declaration and its consequences:

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        The trustee shall not be deemed to have notice of any default or Event of Default (other than a payment default) unless a responsible officer of the trustee has received written notice of any event which is in fact such a default or Event of Default at the Corporate Trust Office of the trustee and such notice references the notes and the indenture.

Defeasance

        The indenture will cease to be of further effect as to all outstanding notes, except as to (1) rights of registration of transfer, substitution and exchange of notes, (2) rights of holders to receive payments of principal of, premium, if any, and interest on the notes and any other rights of the holders with respect to such amounts, (3) the rights, obligations and immunities of the trustee under the indenture and (4) certain other specified provisions in the indenture (the foregoing exceptions (1) through (4) are collectively referred to as the "Reserved Rights"), if:

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        In addition, the Issuer may terminate all of its obligations under the indenture, except as to certain of the Reserved Rights, when (1) all outstanding notes theretofore authenticated have been delivered to the trustee for cancellation and the Issuer has paid or caused to be paid all sums payable under the indenture by the Issuer or (2) the Issuer has called for redemption pursuant to the indenture all of the notes, the amounts described in clause (a) above have been deposited as described therein, the conditions in clauses (x) and (y) of the proviso to such clause (a) have been satisfied and the certificate and opinion described in clause (c) above have been delivered. Notwithstanding the foregoing, the Opinions of Counsel required by clauses (b) and (c) above need not be delivered if all notes not theretofore delivered to the trustee for cancellation (1) have become due and payable, (2) will become due and payable on the maturity date within one year or (3) are to be called for redemption within one year. In addition, the Issuer may at its option and at any time elect to terminate its obligations with respect to certain covenants that are set forth in the indenture, some of which are described under "—Covenants" above.

Modification of the Indenture

        From time to time, the Issuer and the trustee, without the consent of the holders of the notes, may amend the indenture or the notes for the following reasons:

provided that the Issuer has delivered to the trustee an Opinion of Counsel and an Officer's Certificate, each stating that such amendment or supplement complies with the provisions of the indenture.

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        Other modifications and amendments of the indenture or the notes may be made with the consent of the holders of a majority in principal amount of the then outstanding notes issued under the indenture, except that, without the consent of each holder of the notes affected thereby, no amendment may:

Additional Information

        The indenture provides that the Company promptly will deliver to the trustee, but in any event no later than 15 days after the filing of the same with the SEC, copies of the quarterly and annual reports and of the information, documents and other reports, if any, which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The indenture further provides that, notwithstanding that the Company may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will file with the SEC, to the extent permitted, and provide the trustee and holders with such annual reports and such information, documents and other reports specified in Sections 13 and 15(d) of the Exchange Act. The Company will also comply with the other provisions of TIA Section 314(a). The trustee will have no responsibility whatsoever to determine whether any such filing has occurred.

Governing Law

        The indenture provides that it, the notes and the guarantees will be governed by, and construed in accordance with, the laws of the State of New York but without giving effect to applicable principles of conflicts of law to the extent that the application of the law of another jurisdiction would be required thereby.

The Trustee

        The indenture provides that, except during the continuance of an Event of Default, the trustee will perform only such duties as are specifically set forth in the indenture. During the existence of an Event of Default, the trustee will exercise such rights and powers vested in it by the indenture, and use the same degree of care and skill in its exercise as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs.

        The indenture and the provisions of the TIA contain certain limitations on the rights of the trustee, should it become a creditor of the Issuer, to obtain payments of claims in certain cases or to realize on certain property received in respect of any such claim as security or otherwise. Subject to the TIA, the trustee will be permitted to engage in other transactions; provided, however, that if the trustee acquires any conflicting interest as described in the TIA, it must eliminate such conflict or resign.

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No Personal Liability of Directors, Officers, Employees and Stockholders

        No director, officer, employee, stockholder or incorporator of the Issuer, the Company or any other guarantor will have any liability for any obligations of the Issuer, the Company or any other guarantor under the notes, the guarantees or the indenture or for any claim based on, in respect of or by reason of such obligations of their creation. Each holder by accepting a note waives and releases all such liability. Such waiver and release are part of the consideration of the issuance of the notes.

Certain Definitions

        Set forth below is a summary of certain of the defined terms used in the indenture. Reference is made to the indenture for the full definition of all such terms, as well as any other terms used herein for which no definition is provided.

        "Acquired Indebtedness" means Indebtedness of a person or any of its Restricted Subsidiaries existing at the time such person becomes a Restricted Subsidiary of the Company or at the time it merges or consolidates with the Company or any of its subsidiaries or is assumed in connection with the acquisition of assets from such person and not incurred by such person in connection with, or in anticipation or contemplation of, such person becoming a Restricted Subsidiary of the Company or such acquisition, merger or consolidation.

        An "Affiliate" of a person means a person who directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such person; provided, however, that with respect to the Company the term Affiliate shall not include the Company or any subsidiary of the Company so long as no Affiliate of the Company has any direct or indirect interest therein, except through the Company or its subsidiaries. The term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract or otherwise.

        "Applicable Premium" means, with respect to any note on any redemption date, the greater of:

        "Asset Acquisition" means

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        "Asset Sale" means any direct or indirect sale, conveyance, transfer, lease (other than operating leases entered into in the ordinary course of business), assignment or other transfer for value by the Company or any of its Restricted Subsidiaries, to any person other than the Company or a Restricted Subsidiary of the Company of:

provided, however, that Asset Sales will not include

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        "Board of Directors" means (a) with respect to a corporation, the board of directors of the corporation or any committee thereof, (b) with respect to a partnership the general partner of which is a corporation, the board of directors of the general partner of the partnership or any committee thereof and (c) with respect to any other person, the board or committee of such person (or such person's general partner, manager or equivalent) serving a similar function.

        "Business Day" means any day other than a Saturday, Sunday or any other day on which banking institutions in The City of New York or the city in which the corporate trust office is located are required or authorized by law or other governmental action to be closed.

        "Capital Stock" means (1) with respect to any person that is a corporation, any and all shares, interests, participations or other equivalents, however designated, of corporate stock, including each class of common stock and preferred stock of such person and (2) with respect to any person that is not a corporation, any and all partnership or other equity interests of such other person.

        "Capitalized Lease Obligations" means, as to any person, the obligations of such person under a lease that are required to be classified and accounted for as capital lease obligations under GAAP and, for purposes of this definition, the amount of such obligations at any date shall be the capitalized amount of such obligations at such date, determined in accordance with GAAP.

        "Cash Equivalents" means

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        In the case of Investments by any Foreign Subsidiary that is a Restricted Subsidiary or Investments made in a country outside of the United States of America, Cash Equivalents shall also include (i) investments of the type and maturity described in clauses (1) through (8) above of foreign obligors, which Investments or obligors (or the parents of such obligors) have ratings described in such clauses (or reasonably equivalent ratings from comparable foreign rating agencies) and (ii) other short-term investments used by Foreign Subsidiaries that are Restricted Subsidiaries in accordance with normal investment practices for cash management in investments reasonably analogous to the foregoing investments described in clauses (1) through (8) above and in this paragraph.

        "Change of Control" means the occurrence of one or more of the following events:

provided, however, that Change of Control will not include the sale, lease, exchange or other transfer of all or substantially all of the assets of the Issuer to the Company or a subsidiary guarantor.

        Notwithstanding the foregoing, (1) a transaction in which the Company or any direct or indirect parent of the Company becomes a Subsidiary of another Person (other than a Person that is an individual, such Person that is not an individual, the "New Parent") shall not itself constitute a Change of Control; (2) any holding company whose only significant asset is Capital Stock of the Company, New Parent or any direct or indirect parent of the Company shall not itself be considered a "person" or "group" for purposes of this definition; (3) the transfer of assets between or among the Restricted Subsidiaries and the Company in accordance with the terms of the indenture shall not itself constitute a Change of Control; (4) a "person" or "group" shall not be deemed to have beneficial ownership of securities (or "beneficially own" (as such term is defined in Rule 13d-3 and Rule 13d-5 under the

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Exchange Act)) subject to a stock purchase agreement, merger agreement or similar agreement (or voting or option agreement related thereto) until the consummation of the transactions contemplated by such agreement; (5) any change in the relative beneficial ownership of the Permitted Investors that does not alter the overall beneficial ownership of the Permitted Investors shall not constitute a Change of Control; and (6) the term "Change of Control" shall not include a merger or consolidation of the Company with or the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the Company's assets to, an Affiliate incorporated or organized solely for the purpose of reincorporating or reorganizing the Company in another jurisdiction and/or for the sole purpose of forming or collapsing a holding company structure; provided, that, in the case of clauses (1), (2), (5) and (6), each such transaction shall not constitute a Change of Control if (a) the shareholders of the Company or such direct or indirect parent immediately prior to such transaction "beneficially own" (as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly through one or more intermediaries, at least a majority of the voting power of the outstanding voting stock of the New Parent immediately following the consummation of such transaction or (b) immediately following the consummation of such transaction, no "person" (as such term is defined above), other than a Permitted Investor and the New Parent, "beneficially owns" (as such term is defined above), directly or indirectly through one or more intermediaries, more than 50% of the voting power of the outstanding Voting Stock of the Company or the New Parent.

        "Change of Control Repurchase Event" means either (i) the occurrence of both (a) Change of Control (other than under clause (2) of the definition thereof) and (b) a decrease in the rating of the notes by either Moody's or S&P by one or more gradations (including gradations within Rating Categories as well as between Rating Categories) or (ii) a Change of Control under clause (2) of the definition thereof. In determining whether the rating of the notes has decreased by one or more gradations, gradations within Ratings Categories, namely + or – for S&P, and 1, 2 and 3 for Moody's, will be taken into account; for example, in the case of S&P, a ratings decline either from BB+ to BB or BB to BB– will constitute a decrease of one gradation. The term "Ratings Categories" means with respect to S&P, any of the following categories: AAA, AA, A, BBB, BB, B, CCC, CC, C and D (or equivalent successor categories) and with respect to Moody's, any of the following categories: Aaa, Aaa, A, Baa, Ba, B, Caa, Ca, C and D (or equivalent successor categories).

        "Colombia Matter" means the proceedings pending in Colombia between, among others, Scientific Games International, Inc., Empresa Colombiana de Recoursos para la Salud, S.A., a Colombian governmental agency and/or any successor Person, as further disclosed in the Company's Form 10-K filed with the SEC for the fiscal year ended December 31, 2014 (or other proceedings to the extent arising out of or relating to the events or circumstances giving rise to such pending proceedings).

        "Consolidated EBITDA" means, with respect to any person, for any period, the sum (without duplication) of

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        "Consolidated Fixed Charge Coverage Ratio" means, with respect to any person, the ratio of Consolidated EBITDA of such person during the most recent four full fiscal quarters (the "Four Quarter Period") ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio (the "Transaction Date") for which internal financial statements are available to Consolidated Fixed Charges of such person for the Four Quarter Period. In addition to and without limitation of the foregoing, for purposes of this definition, "Consolidated EBITDA" and "Consolidated Fixed Charges" will be calculated after giving effect on a pro forma basis for the period of such calculation to:

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        Furthermore, calculating "Consolidated Fixed Charges" for purposes of determining the denominator (but not the numerator) of this "Consolidated Fixed Charge Coverage Ratio,"

        "Consolidated Fixed Charges" means, with respect to any person for any period, the sum, without duplication, of

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        "Consolidated Interest Expense" means, with respect to any person for any period, the sum of, without duplication,

less the aggregate of all cash and non-cash interest income of such person and its Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP.

        "Consolidated Net Income" means, with respect to any person for any period, the aggregate net income (or loss) of such person and its Restricted Subsidiaries for such period on a consolidated basis, determined in accordance with GAAP; provided, however, that there shall be excluded therefrom

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        "Consolidated Non-Cash Charges" means, with respect to any person for any period, the aggregate depreciation, amortization and other non-cash expenses of such person and its Restricted Subsidiaries reducing Consolidated Net Income of such person and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP (excluding any such charge which requires an accrual of or a reserve for cash charges for any future period).

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        "Credit Agreement" means the Credit Agreement, dated as of October 18, 2013, among the Issuer, as borrower, the Company, as guarantor, the several lenders from time to time parties thereto and Bank of America, N.A., as administrative agent, including all related notes, collateral documents and guarantees, in each case as such agreement may be amended (including any amendment and restatement thereof), supplemented or otherwise modified from time to time, including any agreement extending the maturity of, increasing the total commitment under, refinancing (including by means of sales of debt securities), replacing or otherwise restructuring (including adding subsidiaries of the Company as additional borrowers or guarantors thereunder) all or any portion of the Indebtedness under such agreement or any successor or replacement agreement and whether by the same or any other agent, lender or group of lenders or investors.

        "Credit Facilities" means, one or more debt facilities (including, without limitation, any Credit Agreement), indentures or commercial paper facilities, in each case, with banks or other lenders or investors providing for revolving credit loans, term loans, term debt, debt securities, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or letters of credit, in each case, as amended, restated, modified, renewed, extended, increased, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced (including by means of sales of debt securities) in whole or in part from time to time.

        "Default" means an event or condition the occurrence of which is, or with the lapse of time or the giving of notice or both would be, an Event of Default.

        "Designated Non-Cash Consideration" means the fair market value of non-cash consideration received by the Company or one of its Restricted Subsidiaries in connection with an Asset Sale that is so designated as Designated Non-Cash Consideration pursuant to an Officer's Certificate executed by the principal executive officer and the principal financial officer of the Company or such Restricted Subsidiary, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Non-Cash Consideration.

        "Designated Senior Debt" means (1) any Senior Debt outstanding under the Credit Agreement and (2) any other Senior Debt permitted under the indenture the principal amount of which is $25.0 million or more and that has been designated by the Issuer as Designated Senior Debt in the instrument creating such Indebtedness.

        "Disqualified Capital Stock" means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event (other than an event which would constitute a Change of Control), matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the sole option of the holder thereof (except, in each case, upon the occurrence of a Change of Control), in whole or in part, on or prior to the final maturity date of the notes; excluding any obligations under hedge or warrant agreements entered into in connection with a Permitted Convertible Notes Offering; provided further, that if such Capital Stock is issued to any employee or to any plan for the benefit of employees of the Company or any of its Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Capital Stock solely because it may be required to be repurchased by the Company or a Subsidiary in order to satisfy applicable statutory or regulatory obligations or as a result of such employee's termination, death or disability.

        "Disqualified Holder" means any holder or beneficial owner of the notes (i) who or which is (or who or which is an Affiliate of a Person who or which is) requested or required pursuant to any Gaming Law or by any Gaming Authority to (A) appear before, or submit to the jurisdiction of, or provide information to, or apply for a license, qualification or finding of suitability from, any Gaming Authority, or (B) reduce its position in the notes to below a level that would require licensure,

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qualification or a finding of suitability, and, in either case, such holder or beneficial owner (or Affiliate thereof) either (1) refuses to do so or otherwise fails to comply with such request or requirement within 15 days (or such shorter period as may be required by the applicable Gaming Law or Gaming Authority) or (2) is denied such license or qualification or not found suitable or (ii) who or which is (or who or which is an Affiliate of a Person who or which is) determined or shall have been determined by any Gaming Authority not to be suitable or qualified.

        "Domestic Subsidiary" means any Restricted Subsidiary of the Company that is (i) not a Foreign Subsidiary, (ii) not a direct or indirect Subsidiary of a Foreign Subsidiary and (iii) not a Foreign Subsidiary Holding Company.

        "Equity Offering" means any private or public offering of Qualified Capital Stock of (a) the Company or (b) any direct or indirect parent of the Company, to the extent contributed to the Company as common equity capital or used to purchase Qualified Capital Stock from the Company.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended, or any successor statute or statutes thereto.

        "Existing Senior Subordinated Notes" means the Issuer's existing 6.25% Senior Subordinated Notes due 2020 and the Company's existing 8.125% Senior Subordinated Notes due 2018.

        "fair market value" or "fair value" means, with respect to any asset or property, the price which could be negotiated in an arm's-length free market transaction, for cash, between a willing seller and a willing buyer, neither of whom is under pressure or compulsion to complete the transaction. Fair market value shall be determined by the Company acting reasonably and in good faith.

        "Foreign Subsidiary" means any Restricted Subsidiary of the Company that is not organized under the laws of the United States of America or any State thereof or the District of Columbia.

        "Foreign Subsidiary Holding Company" means any Restricted Subsidiary of the Company which is organized under the laws of the United States of America or any State thereof or the District of Columbia, substantially all of the assets of which consist of the Capital Stock or Indebtedness of one or more Foreign Subsidiaries (or Restricted Subsidiaries thereof) and other assets relating to an ownership interest in such Capital Stock or Indebtedness.

        "GAAP" is defined to mean generally accepted accounting principles in the United States of America as in effect as of December 23, 2004, including, without limitation, those set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as approved by a significant segment of the accounting profession.

        "Gaming Authority" means any government, court, or federal, state, local, international, foreign or other governmental, administrative or regulatory or licensing body, agency, authority or official, which now or hereafter regulates or has authority over, including, without limitation, to issue or grant a license, contract, franchise or regulatory approval with respect to, any form of gaming business or activities (or proposed gaming business or activities) and/or related business or activities now or hereafter conducted by the Company or any of its Affiliates, including, without limitation, lottery, pari-mutuel wagering, sports wagering and video gaming business or activities.

        "Gaming Law" means any federal, state, local, international, foreign or other law, statute, constitutional provision, regulation, rule, order, ordinance, enforcement requirement or interpretation pursuant to which any Gaming Authority possesses or asserts legal, regulatory or licensing authority over gaming and/or related activities.

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        "Hedge Agreement" means any agreement pursuant to which any Hedging Obligation is or was created.

        "Hedging Obligation" means, with respect to any specified Person, the obligations of such Person under any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions, in each case, entered into by the Company or any Restricted Subsidiary.

        "Immaterial Subsidiary" means, as of any date, any Domestic Restricted Subsidiary (other than a Domestic Restricted Subsidiary that guarantees obligations under the Credit Agreement) whose Total Assets, as of the most recent date for which an internal balance sheet is available, are less than 7.5% of the Company's Total Assets and whose Total Revenues for the most recent fiscal year for which internal financial statements are then available do not exceed 7.5% of the Company's Total Revenues; provided, that all that do not guarantee the notes by virtue of being Immaterial Subsidiaries, in the aggregate, shall have total assets as of the end of the most recent fiscal year for which internal financial statements are then available not to exceed 7.5% of the Company's Total Assets and Total Revenues as of the end of the most recent fiscal year for which internal financial statements are then available not to exceed 7.5% of the Company's Total Revenues.

        "Incur" or "incur" means, with respect to any Indebtedness, to, directly or indirectly, create, incur, assume, guarantee, acquire, become liable, contingently or otherwise with respect to, or otherwise become responsible for payment of such Indebtedness.

        "Indebtedness" means with respect to any person, without duplication,

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        For purposes hereof, (1) the "maximum fixed repurchase price" of any Disqualified Capital Stock which does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Capital Stock as if such Disqualified Capital Stock were purchased on any date on which Indebtedness is required to be determined pursuant to the indenture, and if such price is based upon, or measured by, the fair market value of such Disqualified Capital Stock, such fair market value will be determined reasonably and in good faith by the Company of such Disqualified Capital Stock, and (2) accrual of interest or Preferred Stock dividends, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the payment of dividends on Disqualified Capital Stock or Preferred Stock in the form of additional shares of the same class of Disqualified Capital Stock or Preferred Stock and increases in the amount of Indebtedness solely as a result of fluctuations in the exchange rate of currencies or increases in the value of property securing Indebtedness described in clause (7) of the first paragraph of this definition will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Capital Stock or Preferred Stock for purposes of the "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock" covenant. The amount of Indebtedness of any person at any date will be the amount of all unconditional obligations described above, as such amount would be reflected on a balance sheet prepared in accordance with GAAP, and the maximum liability at such date of such person for any contingent obligations described above.

        "Interest Swap Obligations" means the obligations of any person, pursuant to any arrangement with any other person, whereby, directly or indirectly, such person is entitled to receive from time to time periodic payments calculated by applying either a floating or a fixed rate of interest on a stated notional amount in exchange for periodic payments made by such other person calculated by applying a fixed or a floating rate of interest on the same notional amount.

        "Investment" means, with respect to any person, any direct or indirect loan or other extension of credit (including, without limitation, a guarantee) or capital contribution to (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others), or any purchase or acquisition by such person for value of any Capital Stock, bonds, notes, debentures or other securities or evidences of Indebtedness issued by, any person. "Investment" shall exclude extensions of trade credit by the Company and its subsidiaries on commercially reasonable terms. For the purposes of the "—Covenants—Limitation on Restricted Payments" covenant and the definition of "Permitted Investments,"

        If the Company or any Restricted Subsidiary sells or otherwise disposes of any Capital Stock of any Restricted Subsidiary such that, after giving effect to any such sale or disposition, such person is no longer a Restricted Subsidiary, the Company will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Capital Stock of such subsidiary not sold or disposed.

        "Investment Grade Status" shall occur when the notes receive both of the following:

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or the equivalent of such rating by either such rating organization or, if no rating of Moody's or S&P then exists, the equivalent of such rating by any other Nationally Recognized Statistical Ratings Organization.

        "Issue Date" means the original date of issuance of the notes.

        "Joint Venture" means any person (other than a subsidiary of the Company) engaged in a Related Business with respect to which at least 15% of such person's outstanding Capital Stock is owned directly or indirectly by the Company.

        "Lien" means any lien, mortgage, deed of trust, pledge, security interest, charge or encumbrance of any kind (including any conditional sale or other title retention agreement, any lease in the nature thereof and any agreement to give any security interest).

        "Mafco" means MacAndrews & Forbes Holdings, Inc. and its successors.

        "Moody's" means Moody's Investor Service, Inc. and its successors or, if at any time Moody's no longer provides a rating for such obligations, another Nationally Recognized Statistical Rating Organization.

        "Nationally Recognized Statistical Rating Organization" means a nationally recognized statistical rating organization within the meaning of Rule 436 under the Securities Act or any successor thereto.

        "Net Cash Proceeds" means, with respect to any Asset Sale, the proceeds in the form of cash or Cash Equivalents including payments in respect of deferred payment obligations when received in the form of cash or Cash Equivalents (other than the portion of any such deferred payment constituting interest) received by the Company or any of its Restricted Subsidiaries from such Asset Sale, net of:

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        Notwithstanding the foregoing, Net Cash Proceeds will not include proceeds received in a foreign jurisdiction from an Asset Sale of an asset located outside the United States to the extent (and only to the extent)

provided that if, as, and to the extent that any of such proceeds may lawfully be in the case of clause (1) or are in the case of clause (2) transferred to the United States, such proceeds will be deemed to be cash payments that are subject to the terms of this definition of Net Cash Proceeds.

        "Obligations" means, with respect to any Indebtedness, all principal, interest, premiums, penalties, fees, indemnities, expenses (including legal fees and expenses), reimbursement obligations and other liabilities payable to the holder of such Indebtedness under the documentation governing such Indebtedness.

        "Officer" means, with respect to any Person, the Chairman of the Board, the Vice Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Chief Financial Officer, the Controller, the Treasurer, the Secretary or any Assistant Vice President or Assistant Secretary of such Person.

        "Officer's Certificate" of any Person means a certificate signed by any Officer of such Person.

        "Parent Company" means any direct or indirect parent of the Company.

        "Pari Passu Indebtedness" means any Indebtedness of the Issuer or a guarantor of the notes ranking pari passu with the notes or a guarantee of the notes, as the case may be, that the obligor thereon is required to offer to repurchase or repay on a permanent basis in connection with an Asset Sale.

        "Permitted Convertible Notes Offering" means any offering by the Issuer or any of the guarantors after the Issue Date of unsecured convertible notes or debentures; provided that such notes or debentures are permitted to be issued pursuant to the covenant described under "Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock."

        "Permitted Indebtedness" means, without duplication,

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will be deemed, in each case, to constitute an issuance of such Preferred Stock by such Restricted Subsidiary that was not permitted by this clause (16),

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        Additionally, in the case of clauses (2), (9), (10), (13), (14), (15), and (17) of this definition, the aggregate amount of Indebtedness permitted to be incurred under such clause shall be increased by the amount of accrued interest, fees, underwriting discounts, premiums (including consent payments and early tender payments) and other costs and expenses refinanced, paid or incurred in connection with any refinancing of Indebtedness incurred under such clause.

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        In the event that the Company or a Restricted Subsidiary enters into or increases commitments under a revolving credit facility for which it elects to incur the Indebtedness under the Consolidated Fixed Charge Coverage Ratio test described under the caption "—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock," the Consolidated Fixed Charge Coverage Ratio test will be determined on the date of such revolving credit facility or such increase in commitments (assuming that the full amount thereof has been borrowed as of such date), and, if such Consolidated Fixed Charge Coverage Ratio test is satisfied with respect thereto at such time, any borrowing or reborrowing thereunder will be permitted irrespective of the Consolidated Fixed Charge Coverage Ratio at the time of any borrowing or reborrowing (the committed amount permitted to be borrowed or reborrowed on a date pursuant to the operation of this paragraph shall be the "Reserved Indebtedness Amount" as of such date).

        "Permitted Investments" means

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        "Permitted Investors" means the Sponsor and its Affiliates (but excluding any operating portfolio companies of the foregoing), the members of management of any parent company of the Company, the Company or any of its Subsidiaries that have ownership interests in any parent company of the Company or the Company as of the Issue Date, and the directors of the Company or any of its Subsidiaries or any parent company of the Company as of the Closing Date.

        "Permitted Junior Securities" means

        "Permitted Liens" means

        "Permitted Refinancing Indebtedness" means any refinancing, modification, replacement, renewal, restatement, refunding, deferral, extension, substitution, supplement, reissuance or resale of existing or future Indebtedness, including any additional Indebtedness incurred to pay accrued interest, fees, underwriting discounts, premiums required by the instruments governing such existing or future Indebtedness as in effect at the time of issuance thereof or premiums (including consent payments and

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early tender payments) paid in connection with a tender offer for such Indebtedness and other costs and expenses incurred in connection therewith.

        "Permitted Transferees" means, with respect to any Person that is a natural person (and any Permitted Transferee of such person), (a) such Person's immediate family, including his or her spouse, ex-spouse, children, step-children and their respective lineal descendants and (b) the estate of Ronald O. Perelman and (c) any other trust or other legal entity the beneficiary of which is such person's immediate family, including his or her spouse, ex-spouse, children, step-children or their respective lineal descendants and which is controlled by such Person.

        "Person" means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, governmental authority or other entity.

        "Preferred Stock" of any person means any Capital Stock of such person that has preferential rights to any other Capital Stock of such person with respect to dividends or redemptions or upon liquidation.

        "Productive Assets" means assets of a kind used or usable in the businesses of the Company and its Restricted Subsidiaries as conducted on the date of the relevant Asset Sale or any Related Business (including Capital Stock in any such businesses or Related Business and licenses or similar rights to operate; provided, further, that accounts receivable acquired as part of an acquisition of assets of a kind used or usable in such businesses will be deemed to be Productive Assets.

        "Qualified Capital Stock" means any stock that is not Disqualified Capital Stock.

        "Related Business" means the businesses of the Company and its Restricted Subsidiaries as conducted on the Issue Date and similar, complementary or related businesses or reasonable extensions, developments or expansions thereof.

        "Restricted Investment" means an Investment other than a Permitted Investment.

        "Restricted Subsidiary" of any Person means any subsidiary of such Person that at the time of determination is not an Unrestricted Subsidiary.

        "S&P" means Standard & Poor's, a division of the McGraw-Hill Companies, and its successors or, if at any time S&P no longer provides a rating for such obligations, another Nationally Recognized Statistical Rating Organization.

        "Senior Debt" means the principal of, premium, if any, and interest (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law) on any Indebtedness of the Issuer or any guarantor of the notes, whether outstanding on the Issue Date or thereafter created, incurred or assumed, unless, in the case of any particular Indebtedness, the instrument creating or evidencing the same or pursuant to which the same is outstanding expressly provides that such Indebtedness will not be senior in right of payment to the notes. Without limiting the generality of the foregoing, "Senior Debt" will also include the principal of, premium, if any, interest (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law) on, and all other amounts owing in respect of, all monetary obligations (including guarantees thereof) of every nature of the Issuer under the Credit Agreement in effect on the Issue Date, including, without limitation, obligations to pay principal and interest, reimbursement obligations under letters of credit, fees, expenses and indemnities. "Senior Debt" will not include

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        "Significant Subsidiary" shall have the meaning set forth in Rule 1.02(w) of Regulation S-X under the Securities Act.

        "Specified Concession" means any concession, license or other authorization granted or awarded to, or agreement entered into by, the Company, any subsidiary of the Company or any Specified Concession Vehicle by or with an applicable governmental authority, whether such concession, license, authorization or agreement is now existing or hereafter arising and any renewals or extensions of, or any succession to, such concession, license, authorization or agreement, with respect to gaming, gaming machines (including video lottery terminals), wagering, lotteries, interactive activities or any goods or services relating thereto in any jurisdiction, together with any procedures, activities, functions or requirements in connection therewith (or any amendment or supplement to any such concession, license, authorization, agreement, procedures, activities, functions or requirements).

        "Specified Concession Obligations" means any payments, costs, contributions, obligations or commitments made or incurred by any of the Company or any subsidiary of the Company (whether directly or indirectly to or through any Specified Concession Vehicle or any of its equity holders or members) in the form of (and including any costs to obtain, or credits or discounts associated with) (a) tender fees, up-front fees, bid or performance bonds, guarantees, reimbursement obligations or similar arrangements, capital requirements or contributions or similar payments or obligations in connection with any Specified Concession or the formation of or entry into or capitalization, or capital commitment or contribution to, of any Specified Concession Vehicle, or (b) other payments, costs, contributions or obligations (including any credits or discounts) in connection with any Specified Concession, or the formation of or entry into or capitalization of any Specified Concession Vehicle, that are incurred or agreed to in lieu of payments, costs, contributions or obligations described in clause (a) above.

        "Specified Concession Vehicle" means any consortium, joint venture or other Person entered into by the Company and/or any subsidiary of the Company or in or with which the Company and/or any subsidiary of Company directly or indirectly participates or has an interest or a contractual relationship, which consortium, joint venture or other Person holds or is party to a Specified Concession (or is otherwise formed, or directly or indirectly participates or has an interest in or a contractual relationship with such joint venture or other Person, in connection with a Specified Concession).

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        "Sponsor" means (a) Mafco, (b) each of Mafco's direct and indirect subsidiaries and Affiliates, (c) Ronald O. Perelman, (d) any of the directors or executive officers of Mafco or (e) any of their respective Permitted Transferees.

        "Total Assets" means for any person, as of any determination date, the total consolidated assets of such person and its Restricted Subsidiaries, as calculated in accordance with GAAP, as of the most recent date for which internal financial statements are then available, and giving pro forma effect (determined in the same manner as provided for in the definition of Consolidated Fixed Charge Coverage Ratio) to transactions that would change the amount of Total Assets.

        "Total Revenues" means for any person, as of any determination date, the total consolidated revenues of such person and its Restricted Subsidiaries, as calculated in accordance with GAAP, as of the most recent date for which internal financial statements are then available, and giving pro forma effect (determined in the same manner as provided for in the definition of Consolidated Fixed Charge Coverage Ratio) to transactions that would change the amount of Total Revenues.

        "Transactions" means, collectively, the offer and sale of the notes, the redemption or repurchase of the Issuer's 9.25% senior subordinated notes due 2019 and the payment of related fees and expenses as described under the heading "Use of Proceeds" in the offering memorandum relating to the notes dated May 20, 2014.

        "Treasury Rate" means, as of any redemption date, the yield to maturity as of the earlier of (a) such redemption date or (b) the date on which such notes are defeased or satisfied and discharged, of the most recently issued United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to such date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to May 15, 2017; provided, however, that if the period from the redemption date to May 15, 2017, is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. Any such Treasury Rate shall be obtained by the Company.

        "Unrestricted Subsidiary" of any person means

        The board of directors of the Company may designate any subsidiary (other than the Issuer) (including any newly acquired or newly formed subsidiary) to be an Unrestricted Subsidiary unless such subsidiary owns any Capital Stock of, or owns or holds any Lien on any property of, the Company, the Issuer or any other subsidiary of the Company that is not a subsidiary of the subsidiary to be so designated; provided, however, that

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        The board of directors may designate any Unrestricted Subsidiary to be a Restricted Subsidiary only if

        Any such designation by the board of directors will be evidenced to the trustee by promptly filing with the trustee an Officer's Certificate certifying that such designation complied with the foregoing provisions.

        "Voting Stock" of any person as of any date means the Capital Stock of such person that is at the time entitled to vote in the election of the Board of Directors of such person.

        "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing

For purposes of this definition, in the case of debt securities that are by their terms convertible into Capital Stock (or cash or a combination of cash and Capital Stock based on the value of the Capital Stock) of the Company or any parent company of the Company, any obligation to offer to repurchase such debt securities on a date(s) specified in the original terms of such securities, which obligation is not subject to any condition or contingency, will be treated as a final maturity date of such convertible debt securities.

        "Wholly Owned Domestic Restricted Subsidiary" of any person means any Wholly Owned Restricted Subsidiary of such person that is also a Domestic Subsidiary.

        "Wholly Owned Restricted Subsidiary" of any person means any Restricted Subsidiary of such person of which all the outstanding voting securities (other than directors' qualifying shares) are owned by such person or any Wholly Owned Restricted Subsidiary of such person.

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DESCRIPTION OF 2022 NEW NOTES

        The definitions of certain capitalized terms used in the following summary are set forth below under "—Certain Definitions." For purposes of this section, references to the "Company" include only Scientific Games Corporation and not its subsidiaries and references to the "Issuer" include only Scientific Games International, Inc. and not its subsidiaries or its parent company, Scientific Games Corporation.

        On November 21, 2014, SGMS Escrow Corp., a wholly owned subsidiary of the Issuer, issued $2,200,000,000 in aggregate principal amount of its 10.000% senior unsecured notes due 2022, referred to as the "2022 old notes." Promptly following the Bally Acquisition, on November 21, 2014, SGMS Escrow Corp. merged with and into the Issuer, with the Issuer continuing as the surviving corporation, and the Issuer assumed the obligations of SGMS Escrow Corp. under the 2022 old notes (and the indenture referred to below). The 2022 new notes (as defined below) will be issued by the Issuer pursuant to an indenture, dated as of the Issue Date, by and among the Issuer (as successor to SGMS Escrow Corp.), Scientific Games Corporation (the "Company"), the direct and indirect Wholly Owned Domestic Restricted Subsidiaries of the Company (other than the Issuer and certain Immaterial Subsidiaries) (together with the Company, the "guarantors") and Deutsche Bank Trust Company Americas, as trustee. Following the exchange offer, the 2022 new notes will trade as a single class of notes with the 2022 old notes. Unless indicated otherwise, the 2022 old notes and the 2022 new notes are collectively referred to in this "Description of 2022 New Notes" as the "notes" and the indenture governing the notes is referred to in this "Description of 2022 New Notes" as the "indenture." The form and terms of the 2022 new notes will be identical in all material respects to the form and term of the 2022 old notes, except that the terms of the 2022 new notes:

        The following summary of certain provisions of the indenture and the 2022 registration rights agreement is not complete and is qualified in its entirety by reference to the TIA, the indenture and the 2022 registration rights agreement. We urge you to read the indenture, the notes and the 2022 registration rights agreement because they, and not this description, define your rights as holders of the notes. You may request copies of these agreements at the Company's address set forth in the forepart of this prospectus. See "Where You Can Find More Information" and "Incorporation of Certain Documents by Reference."

        The net proceeds from the sale of the 2022 old notes were used by the Issuer, together with the proceeds of the 2022 Secured Notes, borrowings under the Credit Agreement and cash on hand, to fund the purchase price of the Bally Acquisition, repay certain Bally debt and pay related fees and expenses as set forth in the offering memorandum related to the notes, dated November 14, 2014, under the caption "Use of Proceeds."

Brief Description of the Notes

        The notes:

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Principal, Maturity and Interest

        The Issuer issued the 2022 old notes in an initial aggregate principal amount of $2,200.0 million. The 2022 old notes were issued in minimum denominations of $2,000 and any greater integral multiple of $1,000.

        The notes will mature on December 1, 2022. Interest on the notes will accrue at the rate of 10.000% per annum and will be payable semi-annually in cash on June 1 and December 1 of each year, with an initial interest payment on June 1, 2015. The Issuer will make each interest payment to the persons who are registered holders of notes at the close of business on the immediately preceding May 15 and November 15.

        Interest on the notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

        Initially, the trustee will act as paying agent and registrar for the notes. The Issuer may change any paying agent or registrar without notice to the holders of the notes. The Issuer will pay principal and premium, if any, on the notes at the trustee's corporate trust office in New York, New York. At the Issuer's option, interest may be paid at the trustee's corporate trust office in New York, New York or by check mailed to the registered address of holders of the notes.

Indenture May Be Used for Future Issuances

        Subject to compliance with the covenant described under the subheading "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock," the Issuer may issue more notes under the indenture on the same terms and conditions as the notes, except for issue date and issue price, in an unlimited aggregate principal amount (the "Additional Notes"). To the extent required by applicable tax regulations, Additional Notes may not trade fungibly with other notes for U.S. federal income tax purposes and may trade under a separate CUSIP number. The notes and the Additional Notes, if any, will be treated as a single class for all purposes of the indenture, including waivers, amendments, redemptions and offers to purchase. Unless the context otherwise requires, for all purposes of the indenture and this "Description of 2022 New Notes," references to the notes include any Additional Notes actually issued.

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Redemption

Optional Redemption.

        On and after December 1, 2018, the Issuer will be entitled, at its option on one or more occasions, to redeem all or any portion of the notes at the following redemption prices (expressed as percentages of the principal amount thereof) if redeemed during the 12-month period commencing on December 1 of the years set forth below, plus, in each case, accrued and unpaid interest to, but not including, the date of redemption subject to the rights of holders of notes on the relevant record dates occurring prior to the redemption date to receive interest due on the relevant interest payment date:

Period
  Percentage
 

2018

    105.000 %

2019

    102.500 %

2020 and thereafter

    100.000 %

Optional Redemption Upon Equity Offering.

        Prior to December 1, 2017, the Issuer may, at its option on one or more occasions, redeem up to 35% of the initially outstanding aggregate principal amount of the notes (which includes Additional Notes, if any) so long as such aggregate principal amount does not exceed the amount of net cash proceeds received by, or contributed to the capital of, the Company from one or more Equity Offerings, at a redemption price equal to 110% of the principal amount thereof, plus accrued and unpaid interest to, but not including, the date of redemption subject to the rights of holders of notes on the relevant record dates occurring prior to the redemption date to receive interest due on the relevant interest payment date; provided, however, that:

        Redemption at Make-Whole Premium.    At any time prior to December 1, 2018, the Issuer may redeem all or any portion of the notes on one or more occasions at a redemption price equal to 100% of the principal amount of notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, the date of redemption subject to the rights of holders of the notes on the relevant record dates occurring prior to the redemption date to receive interest due on the relevant interest payment date.

        Regulatory Redemption.    If at any time any holder or beneficial owner of notes is determined to be or otherwise is or becomes a Disqualified Holder, then the Issuer will have the right, at its option:

together with, in the case of either clause (a) or (b), accrued and unpaid interest to the earlier of (A) the date of redemption and (B) the date of the denial of license or qualification or of the finding

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of unsuitability by such Gaming Authority (or the date such holder or beneficial owner otherwise becomes a Disqualified Holder) (subject to the rights of holders of the notes on the relevant record dates occurring prior to such redemption date to receive interest due on the relevant interest payment date); provided, however, that if such Gaming Authority restricts the redemption price to a lesser amount, then such lesser amount will be the redemption price.

        Immediately upon a determination by a Gaming Authority that a holder or beneficial owner of notes (or an Affiliate thereof) will not be licensed, qualified or found suitable or is denied a license, qualification or finding of suitability or otherwise becomes a Disqualified Holder, the holder or beneficial owner will, to the extent required by applicable Gaming Laws, have no further rights with respect to the notes to:

        The Issuer will notify the trustee in writing of any such redemption as soon as practicable. The holder or beneficial owner (or an Affiliate thereof) applying for a license, qualification or a finding of suitability must pay all costs of the licensure or investigation for such qualification or finding of suitability.

        Mandatory Redemption.    The Issuer is not required to make mandatory redemption or sinking fund payments with respect to the notes.

Selection and Notice

        In the event that less than all of the notes are to be redeemed at any time (other than in the case of a regulatory redemption), the trustee will select the notes or portions thereof to be redeemed among the holders of the notes as follows:

        The Issuer will redeem notes of $2,000 or less in whole and not in part. Notes in a principal amount in excess of $2,000 may be redeemed in part in multiples of $1,000 only. Notice of redemption will be delivered electronically in pdf format or sent, by first class mail, postage prepaid, at least 30 days and not more than 60 days before the redemption date to each holder of notes to be redeemed at its registered address, except that redemption notices may be delivered electronically in pdf format or mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the notes or a satisfaction and discharge of the indenture.

        If any note is to be redeemed in part only, the notice of redemption that relates to such note will state the portion of the principal amount of the note to be redeemed. A new note in principal amount equal to the unredeemed portion of the note will be issued in the name of the holder thereof upon cancellation of the original note. On and after any redemption date, interest will cease to accrue on the notes or parts thereof called for redemption as long as the Issuer has deposited with the paying agent funds in satisfaction of the redemption price pursuant to the indenture.

        In connection with any redemption of notes (including in any redemption described under "—Optional Redemption"), any such redemption may, at the Issuer's discretion, be subject to one or more conditions precedent, including any related Equity Offering or a Change of Control. In addition,

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if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Issuer's discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied or waived, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied or waived by the redemption date, or by the redemption date so delayed.

Ranking

Senior Indebtedness versus Notes

        The payment of the principal of, premium, if any, and interest on the notes and the payment of any guarantee of the notes will rank pari passu in right of payment with all Senior Indebtedness of the Issuer or the relevant guarantor, as the case may be, including the obligations of the Issuer and such guarantor under the Credit Agreement and the 2022 Secured Notes.

Secured Indebtedness versus Notes

        The notes will be effectively subordinated to all existing Secured Indebtedness of the Issuer or the relevant guarantor, as the case may be, including the obligations of the Issuer and such guarantor under the Credit Agreement and the 2022 Secured Notes, to the extent of the value of the assets securing such Indebtedness.

        As of December 31, 2014, the Issuer and the guarantors had approximately $5,412.0 million of Secured Indebtedness (excluding approximately $197.6 million of outstanding surety bonds and $35.3 million of capital lease obligations), including (1) approximately $4,462.0 million of Secured Indebtedness (which excludes approximately $41.0 million of outstanding letters of credit) under the Credit Agreement and (2) $950.0 million of secured Indebtedness under the 2022 Secured Notes, and the Issuer had approximately $341.6 million of additional availability under the Credit Agreement that the Company and the guarantors would guarantee (all of which would be secured).

        Although the indenture contains limitations on the amount of additional Secured Indebtedness that the Issuer and the guarantors may incur, under certain circumstances the amount of such Indebtedness could be substantial. See "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock" and "—Covenants—Limitation on Liens."

Liabilities of Subsidiaries versus Notes

        Substantially all of the Company's operations are conducted through its subsidiaries. The Company and its direct and indirect Wholly Owned Domestic Restricted Subsidiaries (other than the Issuer and certain Immaterial Subsidiaries) will initially guarantee the notes and the indenture, and the guarantees of such subsidiaries may be released, as described below under "—Guarantees." Claims of creditors of the Company's non-guarantor subsidiaries, including trade creditors and creditors holding indebtedness or guarantees issued by such non-guarantor subsidiaries, and claims of preferred stockholders of such non-guarantor subsidiaries generally will have priority with respect to the assets and earnings of the non-guarantor subsidiaries over the claims of the Issuer's creditors, including holders of the notes. Accordingly, the notes will be structurally subordinated to creditors (including trade creditors) and preferred stockholders, if any, of the non-guarantor subsidiaries.

        As of December 31, 2014, the Company's non-guarantor subsidiaries had outstanding total third-party liabilities of approximately $272.2 million, including trade payables, and no preferred shares.

        Although the indenture limits the incurrence of Indebtedness and preferred stock of certain of the Company's subsidiaries, such limitation is subject to a number of significant qualifications. Moreover, the indenture does not impose any limitation on the incurrence by such subsidiaries of liabilities that

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are not considered Indebtedness under the indenture. See "—Covenants—Limitation on Incurrence of Additional Indebtedness and Issuance of Preferred Stock."

Senior Subordinated Indebtedness versus Notes

        The notes and the guarantees in all respects rank senior in right of payment to any existing and future Subordinated Indebtedness of the Issuer or the relevant guarantor, as the case may be, including the Existing Senior Subordinated Notes and the guarantees thereof.

        As of December 31, 2014, the Issuer and the guarantors had $900.0 million of outstanding senior subordinated indebtedness that ranks junior in right of payment with the notes and the guarantees, all of which was issued or guaranteed, as applicable, on a senior subordinated basis by the Issuer and the guarantors of the notes.

Guarantees

        The guarantors jointly and severally guaranteed, on a senior unsecured basis, the Issuer's performance of its obligations under the notes and the indenture, including the payment of principal with respect to the notes. The guarantors currently consist of the Company and all of the Company's direct and indirect Wholly Owned Domestic Restricted Subsidiaries (other than the Issuer and certain Immaterial Subsidiaries), all of which also guarantee the borrowings under the Credit Agreement, the 2022 Secured Notes and the Existing Senior Subordinated Notes.

        The obligations of each guarantor (other than the obligations of the Company under its guarantee) are limited as necessary to prevent such guarantee from constituting a fraudulent conveyance or fraudulent transfer under federal or state law. Each guarantor (other than the Company) that makes a payment or distribution under a guarantee will be entitled to a contribution from each other guarantor in an amount pro rata, based on the net assets of each guarantor (other than the Company), determined in accordance with GAAP.

        Each guarantor may consolidate with or merge into or sell its assets to the Company, the Issuer or another Restricted Subsidiary of the Company without limitation, or with other persons upon the terms and conditions set forth in the indenture. See "—Covenants—Merger, Consolidation and Sale of Assets." In the event the Capital Stock of a guarantor (other than the Company) is sold or otherwise disposed of, by merger or otherwise, by the Company or any of its subsidiaries to any person that is not a guarantor, or as a result of such sale or disposition the applicable guarantor is no longer a Restricted Subsidiary, and the sale or disposition is not in violation of the provisions set forth in "—Covenants—Limitation on Asset Sales," such guarantor's guarantee will be released and such guarantor shall be relieved of all of its obligations and duties under the indenture and the notes. A guarantor's guarantee (other than the guarantee by the Company) will also be released and such guarantor will also be released from all obligations and duties under the indenture and the notes as described below under "—Covenants—Limitation on Guarantees by Restricted Subsidiaries."

Registration Rights

        The Issuer, the Company and the other guarantors, by way of a joinder agreement, entered into the 2022 registration rights agreement with J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Deutsche Bank Securities Inc. as representatives of the initial purchasers of the 2022 old notes, on the Issue Date. In that agreement, the Issuer and the guarantors agreed for the benefit of the holders of the 2022 old notes that they will use their commercially reasonable efforts to file with the SEC and to cause to become effective, a registration statement relating to an offer to exchange the 2022 old notes for an issue of SEC-registered notes (the "2022 new notes") with terms identical to the 2022 old notes (except that the 2022 new notes will not be subject to restrictions on transfer or to any increase in annual interest rate as described below).

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        Promptly after the SEC declares the exchange offer registration statement effective, the Issuer will offer the 2022 new notes in return for the 2022 old notes. The exchange offer will remain open for at least 20 business days after the date the Issuer mails notice of the exchange offer to holders. For each 2022 old note surrendered to the Issuer under the exchange offer, the holder will receive a 2022 new note of equal principal amount. Interest on each 2022 new note will accrue from the last interest payment date on which interest was paid on the notes or, if no interest has been paid on the notes, from the Issue Date. If applicable interpretations of the staff of the SEC do not permit the Issuer to effect the exchange offer, the Issuer will use its commercially reasonable efforts to cause to become effective a shelf registration statement relating to resales of the notes and to keep that shelf registration statement effective until the first anniversary of the date such shelf registration statement becomes effective, or such shorter period that will terminate when all notes covered by the shelf registration statement have been sold. The Issuer will, in the event of such a shelf registration, provide to each holder copies of a prospectus, notify each holder when the shelf registration statement has become effective and take certain other actions to permit resales of the notes. A holder that sells notes under the shelf registration statement generally will be required to be named as a selling security holder in the related prospectus and to deliver a prospectus to purchasers, will be subject to certain of the civil liability provisions under the Securities Act in connection with those sales and will be bound by the provisions of the 2022 registration rights agreement that are applicable to such a holder (including certain indemnification obligations). The obligation to complete the exchange offer and/or file a shelf registration statement will terminate on the second anniversary of the date of the 2022 registration rights agreement.

        If the exchange offer is not completed (or, if required, the shelf registration statement is not declared effective) on or before the date that is 450 days after the Issue Date (provided that, if the Company determines in good faith that it is in possession of material non-public information, it may extend either such date by up to 90 additional days under customary "blackout" provisions), the annual interest rate borne by the notes will be increased by 0.25% per annum for the first 90-day period immediately following such date and by an additional 0.25% per annum with respect to each subsequent 90-day period, up to a maximum additional rate of 1.0% per annum thereafter until the exchange offer is completed, the shelf registration statement is declared effective or the obligation to complete the exchange offer and/or file the shelf registration statement terminates, as applicable, at which time the interest rate will revert to the original interest rate on the Issue Date.

        If the Issuer effects the exchange offer, it will be entitled to close the exchange offer 20 business days after its commencement; provided that the Issuer has accepted all 2022 old notes validly surrendered in accordance with the terms of the exchange offer. 2022 old notes not tendered in the exchange offer will bear interest at the rate set forth on the cover page of this prospectus and will be subject to all the terms and conditions specified in the indenture, including transfer restrictions.

Change of Control

        Upon the occurrence of a Change of Control, each holder will have the right to require that the Issuer repurchase all or a portion (in integral multiples of $1,000; provided that the Issuer will repurchase notes of $2,000 or less in whole and not in part) of such holder's notes, at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the date of repurchase.

        Within 30 days following the date upon which the Change of Control occurred, the Issuer will send, electronically or by first class mail, a notice to each holder, with a copy to the trustee, offering to purchase the notes as described above (the "Change of Control Offer"). The notice will state, among other things, the payment date, which must be no earlier than 30 days nor later than 60 days from the date such notice is mailed (other than as may be required by law).

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        The Issuer will not be required to make a Change of Control Offer upon a Change of Control if (a) a third party makes the Change of Control Offer in the manner, at the time and otherwise in compliance with the requirements set forth in the indenture applicable to a Change of Control Offer made by the Issuer and purchases all notes properly tendered and not withdrawn under the Change of Control Offer or (b) a notice of redemption relating to the redemption of all of the notes has been given pursuant to the indenture as described above under the caption "—Optional Redemption" and, in the event that such redemption is subject to one or more conditions precedent, such conditions have been satisfied or waived. Notwithstanding anything to the contrary contained in the indenture, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made. The closing date of any such Change of Control Offer made in advance of a Change of Control may be changed to conform to the actual closing date of the Change of Control, provided that such closing date is not earlier than 30 days nor later than 60 days from the date the Change of Control Offer notice is mailed as described in the paragraph above. Additionally, the Company may, at its option, include in any Change of Control Offer an early tender payment, early consent payment or consent payment, so long as any such payment is in addition to the purchase price set forth in the initial paragraph of this section.

        If holders of not less than 90% in aggregate principal amount of the outstanding notes validly tender and do not withdraw such notes in a Change of Control Offer and the Issuer, or any third party making a Change of Control Offer in lieu of the Issuer as described above, purchases all of the notes validly tendered and not withdrawn by such holders, the Issuer or such third party will have the right, upon not less than 30 days nor more than 60 days' prior notice, given not more than 30 days following such purchase pursuant to the Change of Control Offer described above, to redeem all notes that remain outstanding following such purchase at a price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest to, but not including, the date of redemption.

        The occurrence of a Change of Control may constitute a default under the Credit Agreement and any other Credit Facility we may enter into from time to time. Our future Indebtedness may contain prohibitions of certain events that would constitute a Change of Control or require such Indebtedness to be repurchased or repaid upon a Change of Control. Moreover, the exercise by the holders of their right to require the Issuer to purchase the notes could cause a default under such Indebtedness, even if the Change of Control itself does not, due to the financial effect of such repurchase on the Issuer. Finally, the Issuer's ability to pay cash to th