Exhibit 10.7
Employment Agreement
This Employment Agreement (this “Agreement”) is made as of August 28, 2014 by
and between Scientific Games Corporation, a Delaware corporation (the
“Company”), and Steve Wayne Beason (“Executive”).
WHEREAS, the Company and Executive wish to enter into this Agreement, which
shall terminate and supersede the Employment Agreement dated August 8, 2005
between the parties, as amended by letter agreements dated January 17, 2006,
August 30, 2007, June 17, 2008, December 2008, and June 29, 2011 (as so amended
and as amended hereby, the “Prior Employment Agreement”);
NOW, THEREFORE, in consideration of the premises and mutual benefits to be
derived herefrom and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the Company and Executive, the
parties agree as follows.
1.Employment; Term. The Company hereby agrees to employ Executive, and Executive
hereby accepts such employment with the Company, in accordance with and subject
to the terms and conditions set forth in this Agreement. This term of employment
of Executive under this Agreement (the “Term”) shall be the period commencing on
September 1, 2014 (the “Effective Date”) and ending on August 31, 2016, as may
be extended in accordance with this Section 1 and subject to earlier termination
in accordance with Section 4. The Term shall be extended automatically without
further action by either party by one (1) additional year (added to the end of
the Term), and then on each succeeding annual anniversary thereafter, unless
either party shall have given written notice to the other party prior to the
date which is sixty (60) days prior to the date upon which such extension would
otherwise have become effective electing not to further extend the Term, in
which case Executive’s employment shall terminate on the date upon which such
extension would otherwise have become effective, unless earlier terminated in
accordance with Section 4.
2.    Position and Duties. During the Term, Executive will serve as Enterprise
Chief Technology Officer of the Company and as an officer or director of any
subsidiary or affiliate of the Company if elected to any such position by the
stockholders or by the board of directors of any such subsidiary or affiliate,
as the case may be. In such capacities, Executive shall perform such duties and
shall have such responsibilities as are normally associated with such positions,
and as otherwise may be assigned to Executive from time to time by the Company’s
Executive Vice President and Group Chief Executive of Gaming or upon the
authority of board of directors of the Company (the “Board”). Subject to Section
4(e), Executive’s functions, duties and responsibilities are subject to
reasonable changes as the Company may in good faith determine from time to time.
Executive hereby agrees to accept such employment and to serve the Company and
its subsidiaries and affiliates to the best of Executive’s ability in such
capacities, devoting all of Executive’s business time to such employment.
3.    Compensation.
(a)    Base Salary. During the Term, Executive will receive a base salary of
five hundred ten thousand U.S. dollars (US$510,000) per annum (pro-rated for any
partial year), payable in accordance with the Company’s regular payroll
practices and subject to such deductions or amounts to be withheld as required
by applicable law and regulations or as may be agreed to by Executive. In the
event that the Company, in its sole discretion, from time to time determines to
increase Executive’s base salary, such increased amount shall, from and after
the effective date of such increase, constitute the “base salary” of Executive
for purposes of this Agreement.

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(b)    Incentive Compensation.  Executive shall have the opportunity annually to
earn incentive compensation (“Incentive Compensation”) in amounts determined by
the Compensation Committee of the Board (the “Compensation Committee”) in its
sole discretion in accordance with the applicable incentive compensation plan of
the Company as in effect from time to time (the “Incentive Compensation Plan”).
Under such Incentive Compensation Plan, Executive shall have the opportunity
annually to earn up to 66.7% of Executive’s base salary as Incentive
Compensation at “target opportunity” (“Target Bonus”) and up to 133% of
Executive’s base salary as Incentive Compensation at “maximum opportunity” on
the terms and subject to the conditions of such Incentive Compensation Plan (any
such Incentive Compensation to be subject to such deductions or amounts to be
withheld as required by applicable law and regulations or as may be agreed to by
Executive).
(c)    Eligibility for Annual Equity Awards.  Executive shall be eligible to
receive an annual grant of stock options, restricted stock units or other equity
awards in the sole discretion of the Compensation Committee and in accordance
with the applicable plans and programs of the Company for senior executives of
the Company and subject to the Company’s right to at any time amend or terminate
any such plan or program, so long as any such change does not adversely affect
any accrued or vested interest of Executive under any such plan or program.
(d)    Expense Reimbursement. Subject to Section 3(f), the Company shall
reimburse Executive for all reasonable and necessary travel, business
entertainment and other business expenses incurred by Executive in connection
with the performance of Executive’s duties under this Agreement, on a timely
basis upon timely submission by Executive of vouchers therefor in accordance
with the Company’s standard policies and procedures.
(e)    Health and Welfare Benefits. Executive shall be entitled to participate,
without discrimination or duplication, in any and all medical insurance, group
health, disability, life insurance, accidental death and dismemberment
insurance, 401(k) or other retirement, deferred compensation, stock ownership
and such other plans and programs which are made generally available by the
Company to senior executives of the Company in accordance with the terms of such
plans and programs and subject to the right of the Company (or its applicable
affiliate) to at any time amend or terminate any such plan or program. Executive
shall be entitled to paid vacation, holidays and any other time off in
accordance with the Company’s policies in effect from time to time.
(f)    Taxes and Internal Revenue Code 409A. Payment of all compensation and
benefits to Executive under this Agreement shall be subject to all legally
required and customary withholdings. The Company makes no representations or
warranties and shall have no responsibility regarding the tax implications of
the compensation and benefits to be paid to Executive under this Agreement,
including under Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”), and applicable administrative guidance and regulations (“Section
409A”). Section 409A governs plans and arrangements that provide “nonqualified
deferred compensation” (as defined under the Code) which may include, among
others, nonqualified retirement plans, bonus plans, stock option plans,
employment agreements and severance agreements. The Company reserves the right
to pay compensation and provide benefits under this Agreement (including under
Section 3 and Section 4) in amounts, at times and in a manner that minimizes
taxes, interest or penalties as a result of Section 409A. In addition, in the
event any benefits or amounts paid to Executive hereunder are deemed to be
subject to Section 409A, Executive consents to the Company adopting such
conforming amendments as the Company deems necessary, in its reasonable
discretion, to comply with Section 409A (including delaying payment until six
(6) months following termination of employment). To

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the extent any payments of money or other benefits due to Executive hereunder
could cause the application of an accelerated or additional tax under Section
409A, such payments or other benefits may be deferred if deferral will make such
payment or other benefits compliant under Section 409A, or otherwise such
payments or other benefits shall be restructured, to the extent permissible
under Section 409A, in a manner determined by the Company that does not cause
such an accelerated or additional tax. To the extent any reimbursements or
in-kind benefits due to Executive under this Agreement constitute deferred
compensation under Section 409A, any such reimbursements or in-kind benefits
shall be paid to Executive in a manner consistent with Treas. Reg. Section
1.409A-3(i)(1)(iv). Each payment made under this Agreement shall be designated
as a “separate payment” within the meaning of Section 409A.
4.    Termination of Employment. Executive’s employment may be terminated at any
time prior to the end of the Term under the terms described in this Section 4,
and the Term shall automatically terminate upon any termination of Executive’s
employment. For purposes of clarification, except as provided in Section 5.6,
all stock options, restricted stock units and other equity-based awards will be
governed by the terms of the plans, grant agreements and programs under which
such options, restricted stock units or other awards were granted on any
termination of the Term and Executive’s employment with the Company.
(a)    Termination by Executive for Other than Good Reason. Executive may
terminate Executive’s employment hereunder for any reason or no reason upon 60
days’ prior written notice to the Company referring to this Section 4(a);
provided, however, that a termination by Executive for “Good Reason” (as defined
below) shall not constitute a termination by Executive for other than Good
Reason pursuant to this Section 4(a). In the event Executive terminates
Executive’s employment for other than Good Reason, Executive shall be entitled
only to the following compensation and benefits (the payments set forth in
Sections 4(a)(i) – 4(a)(iii), collectively, the “Standard Termination
Payments”):
(i)    any accrued but unpaid base salary for services rendered by Executive to
the date of such termination, payable in accordance with the Company’s regular
payroll practices and subject to such deductions or amounts to be withheld as
required by applicable law and regulations or as may be agreed to by Executive;
(ii)    any vested non-forfeitable amounts owing or accrued at the date of such
termination under benefit plans, programs and arrangements set forth or referred
to in Section 3(e) in which Executive participated during the Term (which will
be paid under the terms and conditions of such plans, programs, and arrangements
(and agreements and documents thereunder)); and
(iii)    reasonable business expenses and disbursements incurred by Executive
prior to such termination will be reimbursed in accordance with Section 3(d).
(b)    Termination By Reason of Death. If Executive dies during the Term, the
last beneficiary designated by Executive by written notice to the Company (or,
in the absence of such designation, Executive’s estate) shall be entitled only
to the Standard Termination Payments, including any benefits that may be payable
under any life insurance benefit of Executive for which the Company pays
premiums, in accordance with the terms of any such benefit and subject to the
right of the Company (or its applicable affiliate) to at any time amend or
terminate any such benefit.
(c)    Termination By Reason of Total Disability. The Company may terminate
Executive’s employment in the event of Executive’s “Total Disability.” For
purposes of this Agreement, “Total Disability” shall mean Executive’s (1)
becoming eligible to receive benefits under any long-term disability insurance
program of the Company or (2) failure to perform the duties and responsibilities

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contemplated under this Agreement for a period of more than 180 days during any
consecutive 12-month period due to physical or mental incapacity or impairment.
In the event that Executive’s employment is terminated by the Company by reason
of Total Disability, the Company shall pay the following amounts, and make the
following other benefits available, to Executive:
(i)    the Standard Termination Payments; and
(ii)    an amount equal to Executive’s annual base salary, payable in
approximately equal installments over a period of twelve (12) months after such
termination; provided that such amount shall be reduced with each installment
payment being reduced pro rata by the amount of any disability payments to which
Executive may be entitled as a result of any disability plan sponsored or
maintained by the Company or any of its affiliates providing benefits to
Executive.
(d)    Termination by the Company for Cause. The Company may terminate the
employment of Executive at any time for “Cause.” For purposes of this Agreement,
“Cause” shall mean: (i) gross neglect by Executive of Executive’s duties
hereunder; (ii) Executive’s indictment for or conviction of a felony, or any
non-felony crime or offense involving the property of the Company or any of its
subsidiaries or affiliates or evidencing moral turpitude; (iii) willful
misconduct by Executive in connection with the performance of Executive’s duties
hereunder; (iv) intentional breach by Executive of any material provision of
this Agreement; (v) material violation by Executive of a material provision of
the Company’s Code of Business Conduct; or (vi) any other willful or grossly
negligent conduct of Executive that would make the continued employment of
Executive by the Company materially prejudicial to the best interests of the
Company. In the event Executive’s employment is terminated for “Cause,”
Executive shall not be entitled to receive any compensation or benefits under
this Agreement except for the Standard Termination Payments.
(e)    Termination by the Company without Cause or by Executive for Good Reason.
The Company may terminate Executive’s employment at any time without Cause, for
any reason or no reason, and Executive may terminate Executive’s employment for
“Good Reason.” For purposes of this Agreement “Good Reason” shall mean that,
without Executive’s prior written consent, any of the following shall have
occurred: (A) a material adverse change to Executive’s positions, titles,
offices, or duties following the Effective Date from those set forth in Section
2, except, in such case, in connection with the termination of Executive’s
employment for Cause or due to Total Disability, death or expiration of the
Term; (B) a material decrease in base salary or material decrease in Executive’s
Incentive Compensation opportunity provided under this Agreement; or (C) any
other material failure by the Company to perform any material obligation under,
or material breach by the Company of any material provision of, this Agreement;
provided, however, that a termination by Executive for Good Reason under any of
clauses (A) through (C) of this Section 4(e) shall not be considered effective
unless Executive shall have provided the Company with written notice of the
specific reasons for such termination within thirty (30) days after he has
knowledge of the event or circumstance constituting Good Reason and the Company
shall have failed to cure the event or condition allegedly constituting Good
Reason within thirty (30) days after such notice has been given to the Company
and Executive actually terminates his employment within one (1) year following
the initial occurrence of the event giving rise to Good Reason. In the event
that Executive’s employment is terminated by the Company without Cause or by
Executive for Good Reason (and not, for the avoidance of doubt, in the event of
a termination pursuant to Section 4(a), (b), (c) or (d) or due to or upon the
expiration of the Term), the Company shall pay the following amounts, and make
the following other benefits available, to Executive.
(i)    the Standard Termination Payments; and

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(ii)    an amount equal to the sum of (A) Executive’s base salary and (B) an
amount equal to the highest annual Incentive Compensation paid to Executive (if
any) in respect of the two (2) most recent fiscal years of the Company but not
more than Executive’s Target Bonus for the-then current fiscal year (such amount
under this sub-clause (B), the “Severance Bonus Amount”), such amount under this
clause (ii) payable over a period of twelve (12) months after such termination
in accordance with Section 4(h); and
(iii)    no later than March 15 following the end of the year in which such
termination occurs, in lieu of any Incentive Compensation for the year in which
such termination occurs, payment of an amount equal to (A) the Incentive
Compensation (if any) which would have been payable to Executive had Executive
remained in employment with the Company during the entire year in which such
termination occurred, multiplied by (B) a fraction the numerator of which is the
number of days Executive was employed in the year in which such termination
occurs and the denominator of which is the total number of days in the year in
which such termination occurs; and
(iv)    if Executive elects to continue medical coverage under the Company’s
group health plan in accordance with COBRA, the monthly premiums for such
coverage for a period of twelve (12) months; and
(f)    Termination by the Company without Cause or by Executive for Good Reason
in connection with a Change in Control. In the event Executive’s employment is
terminated by the Company without Cause or by Executive for Good Reason pursuant
to Section 4(e) and such termination occurs upon, or within one (1) year
immediately following, a “Change in Control” (as defined below), Executive shall
be entitled (without duplication) to the payments and benefits described in
Section 4(e), except that, solely in the case of an amount otherwise payable
under Section 4(e)(ii), such amount shall be multiplied by two (2) (i.e., an
amount equal to two (2) multiplied by the sum of Executive’s base salary and the
Severance Bonus Amount, without duplication) and such amount shall be payable
over a period of twenty-four (24) months after termination in accordance with
Section 4(h) of this Agreement; provided, however, to the extent that such
amount under Section 4(e)(ii) is exempt from Section 409A and/or if such Change
in Control constitutes a change in ownership, change in effective control or a
change in ownership of a substantial portion of the assets of the Company under
Regulation Section 1.409A-3(i)(5), such amount otherwise payable under Section
4(e)(ii) shall be paid in a lump sum in accordance with Section 4(h) of this
Agreement. Notwithstanding the foregoing, payments pursuant to this Section 4(f)
shall be reduced by the amount necessary, if any, to ensure that the aggregate
compensation to be received by the Executive in connection with such Change in
Control does not constitute a “parachute payment,” as such term is defined in 26
U.S.C. § 280G.
For purposes of this Agreement, a “Change in Control” shall be deemed to have
occurred if: (i) any “person” as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and as used in Sections
13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) of the
Exchange Act, but excluding the Company and any subsidiary or affiliate and any
employee benefit plan sponsored or maintained by the Company or any subsidiary
or affiliate (including any trustee of such plan acting as trustee) or any
current stockholder of 20% or more of the outstanding common stock of the
Company, directly or indirectly, becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act) of securities of the Company representing at
least 40% of the combined voting power of the Company’s then-outstanding
securities; (ii) the stockholders of the Company approve a merger,
consolidation, recapitalization, or reorganization of the Company, or a reverse
stock split of any class of voting securities of the Company, or the
consummation of any such transaction if stockholder approval is not obtained,
other than any such transaction that would result in at least 60% of the total
voting power

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represented by the voting securities of the Company or the surviving entity
outstanding immediately after such transaction being beneficially owned by
persons who together beneficially owned at least 80% of the combined voting
power of the voting securities of the Company outstanding immediately prior to
such transaction; provided that, for purposes of this Section 4(f), such
continuity of ownership (and preservation of relative voting power) shall be
deemed to be satisfied if the failure to meet such 60% threshold is due solely
to the acquisition of voting securities by an employee benefit plan of the
Company or such surviving entity or of any subsidiary of the Company or such
surviving entity; (iii) the stockholders of the Company approve a plan of
complete liquidation of the Company, an agreement for the sale or disposition by
the Company of all or substantially all of its assets (or any transaction having
a similar effect); or (iv) during any period of two (2) consecutive years,
individuals who at the beginning of such period constitute the Board, together
with any new director (other than a director designated by a person who has
entered into an agreement with the Company to effect a transaction described in
clause (i), (ii) or (iii) above) whose election by the Board or nomination for
election by the Company’s stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a majority
of the Board.
(g)    Expiration of Term of Agreement. In the event Executive’s employment is
terminated at the end of the Term, Executive shall not be entitled to receive
any compensation or benefits under this Agreement except for the Standard
Termination Payments; provided, however, that:
(i)    subject to Section 5.6 and except to the extent otherwise provided at the
time of grant under the terms of any equity award made to Executive, any
unvested stock options, restricted stock units or other equity awards granted on
or after the Effective Date and held by Executive upon the termination of
Executive at the end of the Term will continue to vest in accordance with the
original vesting schedule applicable to such equity awards (i.e., without regard
to the expiration of this Agreement), and any stock options (A) that were vested
as of such termination will cease being exercisable upon the earlier of three
(3) months after such termination and the scheduled expiration date of such
options and (B) that become vested following such termination in accordance with
the original vesting schedule will cease being exercisable upon the earlier of
three (3) months after such termination and the scheduled expiration date of
such stock options; provided that, in all other respects, all such awards shall
be governed by the plans and programs and the agreements and other documents
pursuant to which the awards were granted; provided, however, that, for the
avoidance of doubt, in the event such termination occurs prior to the
Compensation Committee’s determination as to the satisfaction of any performance
criteria to which any such awards is subject, such awards will not vest (and, in
the case of any such stock options, will not become exercisable) unless and
until a determination is or has been made by the Compensation Committee that
such criteria have been satisfied, at which time such awards will vest (and, in
the case of any such stock options, will become exercisable) to the extent
contemplated by the terms of such award (it being understood and agreed, for the
avoidance of doubt, that such awards will immediately be forfeited to the extent
contemplated by the terms of such award in the event that such criteria are
determined not to have been satisfied); provided, further, however, if necessary
to comply with Section 409A, settlement of any such awards shall be made on the
date that is six (6) months plus one (1) day following expiration of the Term;
and

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(ii)    subject to Section 5.6 and except to the extent otherwise provided at
the time of grant under the terms of any equity award made to Executive, any
unvested stock options granted prior to the Effective Date and any unvested
restricted stock units granted prior to the Effective Date will become fully
vested (and, in the case of any such stock options, exercisable) (provided that
any stock options held by Executive will cease being exercisable upon the
earlier of three (3) months after such termination and the scheduled expiration
date of such stock options), and in all other respects, all such awards shall be
governed by the plans and programs and the agreements and other documents
pursuant to which the awards were granted; provided, however, that in the event
such termination occurs prior to the Compensation Committee’s determination as
to the satisfaction of any performance criteria to which any such stock options
and/or restricted stock units is subject, such stock options and/or restricted
stock units (as the case may be) will not vest (and, in the case of any such
stock options, will not become exercisable) unless and until a determination is
or has been made by the Compensation Committee that such criteria have been
satisfied, at which time such stock options and/or restricted stock units will
vest (and, in the case of any such stock options, will become exercisable) to
the extent contemplated by the terms of such award (it being understood and
agreed, for the avoidance of doubt, that such stock options or restricted stock
units will immediately be forfeited to the extent contemplated by the terms of
such award in the event that such criteria are determined not to have been
satisfied); provided, further, however, if necessary to comply with Section
409A, settlement of any such equity-based awards shall be made on the date that
is six (6) months plus one (1) day following expiration of the Term.
(h)    Timing of Certain Payments under Section 4. For purposes of Section 409A,
references herein to the Executive’s “termination of employment” shall refer to
Executive’s separation of services with the Company within the meaning of Treas.
Reg. Section 1.409A-1(h). If at the time of Executive’s separation of service
with the Company other than as a result of Executive’s death, (i) Executive is a
“specified employee” (as defined in Section 409A(a)(2)(B)(i) of the Code), (ii)
one or more of the payments or benefits received or to be received by Executive
pursuant to this Agreement would constitute deferred compensation subject to
Section 409A, and (iv) the deferral of the commencement of any such payments or
benefits otherwise payable hereunder as a result of such separation of service
is necessary in order to prevent any accelerated or additional tax under Section
409A, such payments may be made as follows: (i) no payments for a six-month
period following the date of Executive’s separation of service with the Company;
(ii) an amount equal to the aggregate sum that would have been otherwise payable
during the initial six-month period paid in a lump sum on the first payroll date
following six (6) months following the date of Executive’s separation of service
with the Company (subject to such deductions or amounts to be withheld as
required by applicable law and regulations); and (iii) during the period
beginning six (6) months following Executive’s separation of service with the
Company through the remainder of the applicable period, payment of the remaining
amount due in equal installments in accordance with the Company’s standard
payroll practices (subject to such deductions or amounts to be withheld as
required by applicable law and regulations).
(i)    Mitigation. In the event the Company terminates Executive’s employment
without Cause or Executive terminates his employment for Good Reason and
Executive is employed by or otherwise engaged to provide services to another
person or entity at any time prior to the end of any period of payments to or on
behalf of Executive contemplated by this Section 4, (i) Executive shall
immediately advise the Company of such employment or engagement and his
compensation therefor (including any health insurance benefits to which he is
entitled in connection therewith), (ii) the Company’s obligation to make
continued

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insurance payments to or on behalf of Executive shall be reduced by any
insurance coverage obtained by Executive during the applicable period through
such other employment or engagement (without regard to when such coverage is
paid) and (iii) the Company’s obligation to make payments pursuant to Section
4(e)(ii) (or, as the case may be, its obligation pursuant to Section 4(f) to
make payments equal to two (2) times the amount contemplated Section 4(e)(ii))
shall be reduced by any base compensation payable to Executive during the
applicable period through such other employment or engagement.
(j)    Set-Off. To the fullest extent permitted by law and provided an
acceleration of income or the imposition of an additional tax under Section 409A
would not result, any amounts otherwise due to Executive hereunder (including
any payments pursuant to this Section 4) shall be subject to set-off with
respect to any amounts Executive otherwise owes the Company or any subsidiary or
affiliate thereof.
(k)    No Other Benefits or Compensation.  Except as may be specifically
provided under this Agreement, under any other effective written agreement
between Executive and the Company, or under the terms of any plan or policy
applicable to Executive, Executive shall have no right to receive any other
compensation from the Company or any subsidiary or affiliate thereof, or to
participate in any other plan, arrangement or benefit provided by the Company or
any subsidiary or affiliate thereof, with respect to any future period after
such termination or resignation. Executive acknowledges and agrees that he is
entitled to no compensation or benefits from the Company or any of its
subsidiaries or affiliates of any kind or nature whatsoever in respect of
periods prior to the date of this Agreement. Executive acknowledges and agrees
that he shall not receive any fees or other compensation (including equity
compensation) for Board service.
(l)    Release of Employment Claims; Compliance with Section 5. Executive
agrees, as a condition to receipt of any termination payments and benefits
provided for in this Section 4 (other than the Standard Termination Payments),
that Executive will execute a general release agreement, in a form reasonably
satisfactory to the Company, releasing any and all claims arising out of
Executive’s employment and the termination of such employment. The Company shall
provide Executive with the proposed form of general release agreement referred
to in the immediately preceding sentence no later than two (2) days following
the date of termination. Executive shall thereupon have 21 days to consider such
general release agreement and, if he executes such general release agreement,
shall have seven (7) days after execution of such general release agreement to
revoke such general release agreement. Absent such revocation, such general
release agreement shall become binding on Executive. If Executive does not
revoke such general release agreement, payments contingent on such general
release agreement that constitute deferred compensation under Section 409A (if
any) shall be paid on the later of 60th day after the date of termination or the
date such payments are otherwise scheduled to be paid pursuant to this
Agreement. The Company’s obligation to make any termination payments and
benefits provided for in this Section 4 (other than the Standard Termination
Payments) shall immediately cease if Executive willfully and materially breaches
Section 5.1, 5.2 , 5.3, 5.4, or 5.8.
5.    Noncompetition; Non-solicitation; Nondisclosure; etc.
5.1 Noncompetition; Non-solicitation.
(a)    Executive acknowledges the highly competitive nature of the Company’s
business and that access to the Company’s confidential records and proprietary
information renders Executive special and unique within the Company’s
industries. In consideration of the amounts that may hereafter be paid to
Executive pursuant to this Agreement (including Sections 3 and 4), Executive
agrees that during the Term (including any extensions thereof) and during the
Covered Time (as defined in Section 5.1(e)), Executive, alone or with others,
will not, directly or indirectly, engage (as owner, investor, partner,
stockholder, employer,

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employee, consultant, advisor, director or otherwise) in any Competing Business.
For purposes of this Section 5, “Competing Business” shall mean any business or
operations: (i) (A) involving the design, development, manufacture, production,
sale, lease, license, provision, operation or management (as the case may be) of
(1) instant lottery tickets or games or any related marketing, warehouse,
distribution, category management or other services or programs; (2)
lottery-related terminals or vending machines (whether clerk-operated,
self-service or otherwise), (3) gaming machines, terminals or devices (including
video or reel spinning slot machines, video poker machines, video lottery
terminals and fixed odds betting terminals), (4) lottery, video gaming
(including server-based gaming), sports betting or other wagering or gaming
systems (including control and monitoring systems, local or wide-area
progressive systems and redemption systems); (5) lottery- or gaming-related
proprietary or licensed content (including themes, entertainment and brands),
platforms, websites and loyalty and customer relationship management programs
(including any of the foregoing relating to online play, social gaming or
interactive (including internet and mobile) lottery or gaming); (6) prepaid
cellular or other phone cards; or (7) ancillary products (including equipment,
hardware, software, marketing materials, chairs and signage) or services
(including field service, maintenance and support) related to any of the
foregoing under sub-clauses (1) through (6) above; or (B) in which the Company
is then or was within the previous 12 months engaged, or in which the Company,
to Executive’s knowledge, contemplates to engage in during the Term or the
Covered Time; (ii) in which Executive was engaged or involved (whether in an
executive or supervisory capacity or otherwise) on behalf of the Company or with
respect to which Executive has obtained proprietary or confidential information;
and (iii) which were conducted anywhere in the United States or in any other
geographic area in which such business was conducted or contemplated to be
conducted by the Company. Notwithstanding anything to the contrary in the
foregoing, the holding of up to one percent (1%) of the outstanding equity in a
publicly traded entity for passive investment purposes shall not, in and of
itself, be construed as engaging in a Competing Business.
(b)     In further consideration of the amounts that may hereafter be paid to
Executive pursuant to this Agreement (including Sections 3 and 4), Executive
agrees that, during the Term (including any extensions thereof) and during the
Covered Time, Executive shall not, directly or indirectly: (i) solicit or
attempt to induce any of the employees, agents, consultants or representatives
of the Company to terminate his, her, or its relationship with the Company; (ii)
solicit or attempt to induce any of the employees, agents, consultants or
representatives of the Company to become employees, agents, consultants or
representatives of any other person or entity; (iii) solicit or attempt to
induce any customer, vendor or distributor of the Company to curtail or cancel
any business with the Company; or (iv) hire any person who, to Executive’s
actual knowledge, is, or was within 180 days prior to such hiring, an employee
of the Company.
(c)    During the Term (including any extensions thereof) and during the Covered
Time, Executive agrees that upon the earlier of Executive’s (i) negotiating with
any Competitor (as defined below) concerning the possible employment of
Executive by the Competitor, (ii) responding to (other than for the purpose of
declining) an offer of employment from a Competitor, or (iii) becoming employed
by a Competitor, (A) Executive will provide copies of Section 5 of this
Agreement to the Competitor, and (B) in the case of any circumstance described
in (iii) above occurring during the Covered Time, and in the case of any
circumstance described in (i) or (ii) above occurring during the Term or during
the Covered Time, Executive will promptly provide notice to the Company of such
circumstances. Executive further agrees that the Company may provide notice to a
Competitor of Executive’s obligations under this Agreement. For purposes of this
Agreement, “Competitor” shall mean any person or entity (other than the Company,
its subsidiaries or affiliates) that engages, directly or indirectly, in the
United States in any Competing Business.
(d)    Executive understands that the restrictions in this Section 5.1 may limit
Executive’s ability to earn a livelihood in a business similar to the business
of the Company but nevertheless agrees and acknowledges that the consideration
provided under this Agreement (including Sections 3 and 4) is sufficient

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to justify such restrictions. In consideration thereof and in light of
Executive’s education, skills and abilities, Executive agrees that Executive
will not assert in any forum that such restrictions prevent Executive from
earning a living or otherwise should be held void or unenforceable.
(e)    For purposes of this Section 5.1, “Covered Time” shall mean the period
beginning on the date of termination of Executive’s employment (the “Date of
Termination”) and ending twelve (12) months after the Date of Termination.
5.2    Proprietary Information; Inventions.
(a)Executive acknowledges that, during the course of Executive’s employment with
the Company, Executive necessarily will have (and during any employment by, or
affiliation with, the Company prior to the Term has had) access to and make use
of proprietary information and confidential records of the Company. Executive
covenants that Executive shall not during the Term or at any time thereafter,
directly or indirectly, use for Executive’s own purpose or for the benefit of
any person or entity other than the Company, nor otherwise disclose to any
person or entity, any such proprietary information, unless and to the extent
such disclosure has been authorized in writing by the Company or is otherwise
required by law. The term “proprietary information” means: (i) the software
products, programs, applications, and processes utilized by the Company; (ii)
the name and/or address of any customer or vendor of the Company or any
information concerning the transactions or relations of any customer or vendor
of the Company with the Company; (iii) any information concerning any product,
technology, or procedure employed by the Company but not generally known to its
customers or vendors or competitors, or under development by or being tested by
the Company but not at the time offered generally to customers or vendors; (iv)
any information relating to the Company’s computer software, computer systems,
pricing or marketing methods, sales margins, cost of goods, cost of material,
capital structure, operating results, borrowing arrangements or business plans;
(v) any information identified as confidential or proprietary in any line of
business engaged in by the Company; (vi) any information that, to Executive’s
actual knowledge, the Company ordinarily maintains as confidential or
proprietary; (vii) any business plans, budgets, advertising or marketing plans;
(viii) any information contained in any of the Company’s written or oral
policies and procedures or manuals; (ix) any information belonging to customers,
vendors or any other person or entity which the Company, to Executive’s actual
knowledge, has agreed to hold in confidence; and (x) all written, graphic,
electronic data and other material containing any of the foregoing. Executive
acknowledges that information that is not novel or copyrighted or patented may
nonetheless be proprietary information. The term “proprietary information” shall
not include information generally known or available to the public, information
that becomes available to Executive on an unrestricted, non-confidential basis
from a source other than the Company or any of its directors, officers,
employees, agents or other representatives (without breach of any obligation of
confidentiality of which Executive has knowledge, after reasonable inquiry, at
the time of the relevant disclosure by Executive), or general gaming industry
information to the extent not particularly related or proprietary to the Company
that was already known to Executive at the time Executive commences his
employment by the Company that is not subject to nondisclosure by virtue of
Executive’s prior employment or otherwise. Notwithstanding the foregoing and
Section 5.3, Executive may disclose or use proprietary information or
confidential records solely to the extent (A) such disclosure or use may be
required or appropriate in the performance of his duties as a director or
employee of the Company, (B) required to do so by a court of law, by any
governmental agency having supervisory authority over the business of the
Company or by any administrative or legislative body (including a committee
thereof) with apparent jurisdiction to order him to divulge, disclose or make
accessible such information (provided that in such case Executive shall first
give the Company prompt written notice of any such legal requirement, disclose
no more information than is so required and cooperate fully with all efforts by
the Company to obtain a protective order or similar confidentiality treatment
for such information), (C) such information or

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records becomes generally known to the public without his violation of this
Agreement, or (D) disclosed to Executive’s spouse, attorney and/or his personal
tax and financial advisors to the extent reasonably necessary to advance
Executive’s tax, financial and other personal planning (each an “Exempt
Person”); provided, however, that any disclosure or use of any proprietary
information or confidential records by an Exempt Person shall be deemed to be a
breach of this Section 5.2 or Section 5.3 by Executive.
(b)    Executive agrees that all processes, technologies and inventions
(collectively, “Inventions”), including new contributions, improvements, ideas
and discoveries, whether patentable or not, conceived, developed, invented or
made by Executive during the Term (and during any employment by, or affiliation
with, the Company prior to the Term) shall belong to the Company, provided that
such Inventions grew out of Executive’s work with the Company or any of its
subsidiaries or affiliates, are related in any manner to the business
(commercial or experimental) of the Company or any of its subsidiaries or
affiliates or are conceived or made on the Company’s time or with the use of the
Company’s facilities or materials. Executive shall further: (i) promptly
disclose such Inventions to the Company; (ii) assign to the Company, without
additional compensation, all patent and other rights to such Inventions for the
United States and foreign countries; (iii) sign all papers necessary to carry
out the foregoing; and (iv) give testimony in support of Executive’s
inventorship. If any Invention is described in a patent application or is
disclosed to third parties, directly or indirectly, by Executive within two (2)
years after the termination of Executive’s employment with the Company, it is to
be presumed that the Invention was conceived or made during the Term. Executive
agrees that Executive will not assert any rights to any Invention as having been
made or acquired by Executive prior to the date of this Agreement, except for
Inventions, if any, disclosed in Exhibit A to this Agreement.
5.3    Confidentiality and Surrender of Records.  Executive shall not, during
the Term or at any time thereafter (irrespective of the circumstances under
which Executive’s employment by the Company terminates), except to the extent
required by law, directly or indirectly publish, make known or in any fashion
disclose any confidential records to, or permit any inspection or copying of
confidential records by, any person or entity other than in the course of such
person’s or entity’s employment or retention by the Company, nor shall Executive
retain, and will deliver promptly to the Company, any of the same following
termination of Executive’s employment hereunder for any reason or upon request
by the Company. For purposes hereof, “confidential records” means those portions
of correspondence, memoranda, files, manuals, books, lists, financial, operating
or marketing records, magnetic tape, or electronic or other media or equipment
of any kind in Executive’s possession or under Executive’s control or accessible
to Executive which contain any proprietary information. All confidential records
shall be and remain the sole property of the Company during the Term and
thereafter.
5.4    Non-disparagement. Executive shall not, during the Term and thereafter,
disparage in any material respect the Company, any affiliate of the Company, any
of their respective businesses, any of their respective officers, directors or
employees, or the reputation of any of the foregoing persons or entities.
Notwithstanding the foregoing, nothing in this Agreement shall preclude
Executive from making truthful statements that are required by applicable law,
regulation or legal process.
5.5    No Other Obligations. Executive represents that Executive is not
precluded or limited in Executive’s ability to undertake or perform the duties
described herein by any contract, agreement or restrictive covenant. Executive
covenants that Executive shall not employ the trade secrets or proprietary
information of any other person in connection with Executive’s employment by the
Company without such person’s authorization.
5.6    Forfeiture of Outstanding Equity Awards; “Clawback” Policies. The
provisions of Section 4 notwithstanding, if Executive willfully and materially
fails to comply with Section 5.1, 5.2, 5.3, 5.4, or 5.8, all options to purchase
common stock, restricted stock units and other equity-based awards granted by
the Company or any of its affiliates (whether prior to, contemporaneous with, or
subsequent to the date hereof) and held by Executive or a transferee of
Executive shall be immediately forfeited and cancelled. Executive acknowledges
and agrees that, notwithstanding anything contained in this Agreement or any
other agreement, plan or program, any incentive-based compensation or benefits
contemplated under this Agreement (including Incentive Compensation and
equity-based awards) shall be subject to recovery by the Company under any
compensation recovery or “clawback” policy, generally applicable to senior
executives of the Company, that the Company may adopt from time to time,
including any policy which the Company may be required to adopt under Section
954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the
rules and regulations of the Securities and Exchange Commission thereunder or
the requirements of any national securities exchange on which the Company’s
common stock may be listed.
5.7    Enforcement. Executive acknowledges and agrees that, by virtue of
Executive’s position, services and access to and use of confidential records and
proprietary information, any violation by Executive of any of the undertakings
contained in this Section 5 would cause the Company immediate, substantial and
irreparable injury for which it has no adequate remedy at law. Accordingly,
Executive agrees and consents to the entry of an injunction or other equitable
relief by a court of competent jurisdiction restraining any violation or
threatened violation of any undertaking contained in this Section 5. Executive
waives posting of any bond otherwise necessary to secure such injunction or
other equitable relief. Rights and remedies provided for in this Section 5 are
cumulative and shall be in addition to rights and remedies otherwise available
to the parties hereunder or under any other agreement or applicable law.
5.8    Cooperation with Regard to Litigation. Executive agrees to cooperate
reasonably with the Company, during the Term and thereafter (including following
Executive’s termination of employment for any reason), by being available to
testify on behalf of the Company in any action, suit, or proceeding, whether
civil, criminal, administrative, or investigative. In addition, except to the
extent that Executive has or intends to assert in good faith an interest or
position adverse to or inconsistent with the interest or position of the
Company, Executive agrees to cooperate reasonably with the Company, during the
Term and thereafter (including following Executive’s termination of employment
for any reason), to assist the Company in any such action, suit, or proceeding
by providing information and meeting and consulting with the Board or its
representatives or counsel, or representatives or counsel to the Company, in
each case, as reasonably requested by the Company. The Company agrees to pay (or
reimburse, if already paid by Executive) all reasonable expenses actually
incurred in connection with Executive’s cooperation and assistance including
reasonable fees and disbursements of counsel, if any, chosen by Executive if
Executive reasonably determines in good faith, on the advice of counsel, that
the Company’s counsel may not ethically represent Executive in connection with
such action, suit or proceeding due to actual or potential conflicts of
interests.
5.9    Survival. The provisions of this Section 5 shall survive the termination
of the Term and any termination or expiration of this Agreement.

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5.10    Company. For purposes of this Section 5, references to the “Company”
shall include the Company and each subsidiary and/or affiliate of the Company
(and each of their respective joint ventures and equity method investees).
6.    Code of Conduct. Executive acknowledges that he has read the Company’s
Code of Business Conduct and agrees to abide by such Code of Business Conduct,
as amended or supplemented from time to time, and other policies applicable to
employees and executives of the Company.
7.    Indemnification.  The Company shall indemnify Executive to the full extent
permitted under the Company’s Certificate of Incorporation or By-Laws and
pursuant to any other agreements or policies in effect from time to time in
connection with any action, suit or proceeding to which Executive may be made a
party by reason of Executive being an officer, director or employee of the
Company or of any subsidiary or affiliate of the Company.
8.    Assignability; Binding Effect.  Neither this Agreement nor the rights or
obligations hereunder of the parties shall be transferable or assignable by
Executive, except in accordance with the laws of descent and distribution and as
specified below. The Company may assign this Agreement and the Company’s rights
and obligations hereunder to any affiliate of the Company, provided that upon
any such assignment the Company shall remain liable for the obligations to
Executive hereunder. This Agreement shall be binding upon and inure to the
benefit of Executive, Executive’s heirs, executors, administrators, and
beneficiaries, and shall be binding upon and inure to the benefit of the Company
and its successors and assigns.
9.    Complete Understanding; Amendment; Waiver. This Agreement constitutes the
complete understanding between the parties with respect to the employment of
Executive and supersedes all other prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter hereof,
including without limitation the Prior Employment Agreement, and no statement,
representation, warranty or covenant has been made by either party with respect
thereto except as expressly set forth herein. Except as contemplated by Section
3(f), this Agreement shall not be modified, amended or terminated except by a
written instrument signed by each of the parties. Any waiver of any term or
provision hereof, or of the application of any such term or provision to any
circumstances, shall be in writing signed by the party charged with giving such
waiver. Waiver by either party of any breach hereunder by the other party shall
not operate as a waiver of any other breach, whether similar to or different
from the breach waived. No delay by either party in the exercise of any rights
or remedies shall operate as a waiver thereof, and no single or partial exercise
by either party of any such right or remedy shall preclude other or further
exercise thereof.
10.    Severability. If any provision of this Agreement or the application of
any such provision to any person or circumstances shall be determined by any
court of competent jurisdiction to be invalid or unenforceable to any extent,
the remainder of this Agreement, or the application of such provision to such
person or circumstances other than those to which it is so determined to be
invalid or unenforceable, shall not be affected thereby, and each provision
hereof shall be enforced to the fullest extent permitted by law. If any
provision of this Agreement, or any part thereof, is held to be invalid or
unenforceable because of the scope or duration of or the area covered by such
provision, the parties agree that the court making such determination shall
reduce the scope, duration and/or area of such provision (and shall substitute
appropriate provisions for any such invalid or unenforceable provisions) in
order to make such provision enforceable to the fullest extent permitted by law
and/or shall delete specific words and phrases, and such modified provision
shall then be enforceable and shall be enforced. The parties recognize that if,
in any judicial proceeding, a court shall refuse to enforce any of the separate
covenants contained in this Agreement, then that invalid or

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unenforceable covenant contained in this Agreement shall be deemed eliminated
from these provisions to the extent necessary to permit the remaining separate
covenants to be enforced. In the event that any court determines that the time
period or the area, or both, are unreasonable and that any of the covenants is
to that extent invalid or unenforceable, the parties agree that such covenants
will remain in full force and effect, first, for the greatest time period, and
second, in the greatest geographical area that would not render them
unenforceable.
11.    Survivability. The provisions of this Agreement which by their terms call
for performance subsequent to termination of Executive’s employment hereunder,
or of this Agreement, shall so survive such termination, whether or not such
provisions expressly state that they shall so survive.
12.    Governing Law; Arbitration.
(a)    Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois applicable to agreements made
and to be wholly performed within that State, without regard to its conflict of
laws provisions.
(b)    Arbitration. 
(i)    Executive and the Company agree that, except for claims for workers’
compensation, unemployment compensation, and any other claim that is
non-arbitrable under applicable law, final and binding arbitration shall be the
exclusive forum for any dispute or controversy between them, including, without
limitation, disputes arising under or in connection with this Agreement,
Executive’s employment, and/or termination of employment, with the Company;
provided, however, that the Company shall be entitled to commence an action in
any court of competent jurisdiction for injunctive relief in connection with any
alleged actual or threatened violation of any provision of Section 5. Judgment
may be entered on the arbitrators’ award in any court having jurisdiction. For
purposes of entering such judgment or seeking injunctive relief with regard to
Section 5, the Company and Executive hereby consent to the jurisdiction of any
situated in Chicago, Illinois; provided that damages for any alleged violation
of Section 5, as well as any claim, counterclaim or cross-claim brought by
Executive or any third-party in response to, or in connection with any court
action commenced by the Company seeking said injunctive relief shall remain
exclusively subject to final and binding arbitration as provided for herein. The
Company and Executive hereby waive, to the fullest extent permitted by
applicable law, any objection which either may now or hereafter have to such
jurisdiction, venue and any defense of inconvenient forum. Thus, except for the
claims carved out above, this Agreement includes all common-law and statutory
claims (whether arising under federal state or local law), including any claim
for breach of contract, fraud, fraud in the inducement, unpaid wages, wrongful
termination, and gender, age, national origin, sexual orientation, marital
status, disability, or any other  protected status.
Any arbitration under this Agreement shall be filed exclusively with, and
administered by, the American Arbitration Association in Chicago, Illinois
before three arbitrators, in accordance with the National Rules for the
Resolution of Employment Disputes of the American Arbitration Association in
effect at the time of submission to arbitration. The Company and Executive
hereby agree that a judgment upon an award rendered by the arbitrators may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. The Company shall pay all costs uniquely attributable to
arbitration, including the administrative fees and costs of the arbitrators. 
Each party shall pay that party’s own costs and attorney fees, if any, unless
the arbitrators rule otherwise. Executive understands that he is giving up no
substantive rights, and this Agreement

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simply governs forum. The arbitrators shall apply the same standards a court
would apply to award any damages, attorney fees or costs. Executive shall not be
required to pay any fee or cost that he would not otherwise be required to pay
in a court action, unless so ordered by the arbitrators.
EXECUTIVE INITIALS: SB         COMPANY INITIALS: PAM
(c)    WAIVER OF JURY TRIAL. BY SIGNING THIS AGREEMENT, EXECUTIVE AND THE
COMPANY ACKNOWLEDGE THAT THE RIGHT TO A COURT TRIAL AND TRIAL BY JURY IS OF
VALUE, AND KNOWINGLY AND VOLUNTARILY WAIVE THAT RIGHT FOR ANY DISPUTE SUBJECT TO
THE TERMS OF THIS ARBITRATION PROVISION.
13.     Titles and Captions.  All paragraph titles or captions in this Agreement
are for convenience only and in no way define, limit, extend or describe the
scope or intent of any provision hereof.
14.    Joint Drafting. In recognition of the fact that the parties had an equal
opportunity to negotiate the language of, and draft, this Agreement, the parties
acknowledge and agree that there is no single drafter of this Agreement and,
therefore, the general rule that ambiguities are to be construed against the
drafter is, and shall be, inapplicable.  If any language in this Agreement is
found or claimed to be ambiguous, each party shall have the same opportunity to
present evidence as to the actual intent of the parties with respect to any such
ambiguous language without any inference or presumption being drawn against any
party.
15.    Notices. All notices and other communications to be given or to otherwise
be made to any party to this Agreement shall be deemed to be sufficient if
contained in a written instrument delivered in person or duly sent by certified
mail or by a recognized national courier service, postage or charges prepaid,
(a) to Scientific Games Corporation, Attn: Legal Department, at 750 Lexington
Avenue, 25th Floor, New York, NY 10022, (b) to Executive, at the last address
shown in the Company’s records, or (c) to such other replacement address as may
be designated in writing by the addressee to the addressor.
16.    Interpretation. When a reference is made in this Agreement to a Section,
such reference shall be to a Section of this Agreement unless otherwise
indicated. Whenever the words “include,” “includes” or “including” are used in
this Agreement, they shall be deemed to be followed by the words “without
limitation,” unless the context otherwise indicates. When a reference in this
Agreement is made to a “party” or “parties,” such reference shall be to a party
or parties to this Agreement unless otherwise indicated or the context requires
otherwise. Unless the context requires otherwise, (a) the terms “hereof,”
“herein,” “hereby,” “hereto”, “hereunder” and derivative or similar words in
this Agreement refer to this entire Agreement, (b) the word “or” is disjunctive
but not exclusive and (c) words in this Agreement using the singular or plural
number also include the plural or singular number, respectively, and the use of
any gender herein shall be deemed to include the other genders. References in
this Agreement to “dollars” or “$” are to U.S. dollars. When a reference is made
in this Agreement to a law, statute or legislation, such reference shall be to
such law, statute or legislation as it may be amended, modified, extended or
re-enacted from time to time (including any successor law, statute or
legislation) and shall include any regulations promulgated thereunder from time
to time. The headings used herein are for reference only and shall not affect
the construction of this Agreement.
[remainder of page intentionally left blank]

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IN WITNESS WHEREOF, each of the parties has duly executed this Agreement as of
the date above written.
 
SCIENTIFIC GAMES CORPORATION
 
 
 

By: /s/ Peter A.
Mani________________________                                                          
Name: Peter A. Mani
Title: VP and Chief Human Resources Officer
 
 

 

EXECUTIVE

 
 
 
/s/ Steve W. Beason________________________
Name: Steven Wayne Beason

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Exhibit A
Inventions
None

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