EXHIBIT 10.1
SCIENTIFIC GAMES CORPORATION
INDUCEMENT STOCK OPTION GRANT AGREEMENT
FOR STEVEN WAYNE BEASON
THIS AGREEMENT, made as of the 8th day of August, 2005, between SCIENTIFIC GAMES
CORPORATION (the "Company") and STEVEN WAYNE BEASON (the "Participant").
WHEREAS, the Compensation Committee (the "Committee") administers the Company's
equity incentive compensation programs and is authorized to grant stock options
and other awards, including to newly hired employees; and
WHEREAS, the Participant was granted the option evidenced by this Agreement as
of the date hereof as an inducement to the Participant to become an employee of
the Company or a subsidiary of the Company as of that date;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto hereby agree as follows.
1.
GRANT OF OPTIONS. PURSUANT TO, AND SUBJECT TO, THE TERMS AND CONDITIONS
SET FORTH HEREIN, THE PARTICIPANT IS HEREBY GRANTED AN OPTION (THE "OPTION") TO
PURCHASE 275,000 SHARES OF THE COMPANY'S CLASS A COMMON STOCK, $.01 PAR VALUE
PER SHARE (THE "COMMON STOCK").
THE OPTION DOES NOT CONSTITUTE AN "INCENTIVE
STOCK OPTION" WITHIN THE MEANING OF SECTION 422 OF THE INTERNAL REVENUE CODE OF
1986.
2.
GRANT DATE.
THE GRANT DATE OF THE OPTION GRANTED HEREBY IS AUGUST 8,
2005.
3.
DEFINITIONS.
FOR PURPOSES OF THIS AGREEMENT, THE FOLLOWING TERMS SHALL
BE DEFINED AS SET FORTH BELOW:
(A)
"BENEFICIARY" MEANS THE PERSON, PERSONS, TRUST, OR TRUSTS WHICH MAY BE
DESIGNATED BY THE PARTICIPANT IN A WRITTEN BENEFICIARY DESIGNATION FILED WITH
THE COMMITTEE TO RECEIVE THE BENEFITS SPECIFIED HEREUNDER UPON THE PARTICIPANT'S
DEATH. IF, UPON THE PARTICIPANT'S DEATH, THERE IS NO DESIGNATED BENEFICIARY OR
SURVIVING DESIGNATED BENEFICIARY, THEN THE TERM BENEFICIARY MEANS THE PERSON,
PERSONS, TRUST, OR TRUSTS ENTITLED BY WILL OR THE LAWS OF DESCENT AND
DISTRIBUTION TO RECEIVE SUCH BENEFITS.
(B)
"EXCHANGE ACT" MEANS THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
FROM TIME TO TIME, INCLUDING RULES THEREUNDER AND SUCCESSOR PROVISIONS AND RULES
THERETO.
(C)
"FAIR MARKET VALUE" MEANS THE FAIR MARKET VALUE OF COMMON STOCK, AS
DETERMINED BY THE COMMITTEE OR UNDER PROCEDURES ESTABLISHED BY THE COMMITTEE.
UNLESS OTHERWISE DETERMINED BY THE COMMITTEE, THE FAIR MARKET VALUE OF COMMON
STOCK SHALL BE THE AVERAGE OF THE HIGH AND LOW SALES PRICES OF THE COMMON STOCK
ON A GIVEN DATE OR, IF THERE ARE NO SALES ON THAT DATE, ON THE LATEST PREVIOUS
DATE ON WHICH THERE WERE SALES, REPORTED FOR COMPOSITE TRANSACTIONS IN
SECURITIES LISTED ON THE PRINCIPAL TRADING MARKET ON WHICH THE COMMON STOCK IS
THEN LISTED.
4.
VESTING DATES. THIS OPTION SHALL VEST AND BECOME EXERCISABLE IN THE
FOLLOWING INSTALLMENTS:
Number of Shares
Dates
91,667
August 8, 2006
91,667
August 8, 2007
91,666
August 8, 2008 (the "Last Vesting Date")
5.
EXERCISE PRICE. THE EXERCISE PRICE PER SHARE OF EACH SHARE WITH RESPECT
TO WHICH THIS OPTION IS GRANTED IS $29.18, WHICH IS NOT LESS THAN THE FAIR
MARKET VALUE OF A SHARE OF COMMON STOCK ON THE GRANT DATE.
6.
EXPIRATION DATE; EFFECT OF TERMINATION OF EMPLOYMENT.