Document:

Exhibit 10.31 Michael R. Chambrello Agreement and General Release

Exhibit 10.31

AGREEMENT AND GENERAL RELEASE

This Agreement and General Release (this “Agreement”) is made and entered into as of the Execution Date (as defined below), by and between Michael R. Chambrello (“Executive”) and Scientific Games Corporation, a Delaware corporation (the “Company”).
WHEREAS, Executive has been employed most recently as Chief Executive Officer-Asia Pacific Region for the Company pursuant to an Employment Agreement dated as of July 1, 2005 (executed on June 17, 20015), as amended by the Letter Agreement dated as of August 2, 2006, the Letter Agreement dated as of May 8, 2008, the Amendment to Employment Agreement, dated as of December 30, 2008, and the Amendment to Employment Agreement dated as of November 29, 2010  (as so amended, the “Employment Agreement”);
WHEREAS, the Company and Executive desire to enter into this Agreement in connection with Executive’s separation from employment with the Company;
NOW THEREFORE, in consideration of the recitals and the mutual promises, covenants and agreements set forth in this Agreement, the parties hereby agree as follows:
1.Separation.  Executive ceased serving as Chief Executive Officer-Asia Pacific Region for the Company as of December 31, 2013 (the “Separation Date”).  The Employment Agreement (and, as to Executive, the Program (as defined below)) shall automatically terminate and be of no further force or effect as of the Separation Date, except that Sections 7.1, 7.2, 7.3, 7.5, 7.6, 7.7, 7.10 and the last two sentences of Section 6(i) of the Employment Agreement (collectively, the “Surviving Provisions”) and Section 8 of the Employment Agreement shall survive such termination and continue in full force and effect in accordance with their respective terms (and the Surviving Provisions are incorporated herein by reference).  Effective upon the Separation Date, Executive shall be deemed to have resigned from all officer, director, manager, and trustee positions of the Company and its subsidiaries and affiliates and, following the Separation Date (and shall execute any separate resignation letters if requested by the Company), Executive shall not represent himself as being an employee, officer, director, manager, agent, or representative of the Company or any of its subsidiaries or affiliates.  The Separation Date shall be the termination date of Executive’s employment for purposes of participation in and coverage under all benefit plans and programs sponsored by or through the Company and any of its subsidiaries or affiliates, except as otherwise specifically provided herein.
2.    Consideration to Executive.  Except for any payments or benefits Executive has accrued or vested in pursuant to Executive’s participation in the Company’s 401(k) plan and Elective Deferred Compensation Plan, which shall be subject to the terms and conditions set forth in such plans, Executive acknowledges and agrees that the payments and benefits set forth in this Section 2 fulfill any and all of the Company’s obligations due to Executive under any agreement or bonus, incentive compensation, severance or separation plan or allowance or any other compensation or benefit plan or arrangement maintained by the Company or any of its subsidiaries (including the Employment Agreement and the Program), and Executive specifically acknowledges and agrees that Executive is entitled to no other compensation or benefits (of any kind or nature whatsoever) from the Company or any of its subsidiaries.  In full consideration of Executive’s promises, covenants and agreements set forth in this Agreement, and for other good and valuable consideration, receipt of which is hereby acknowledged, and subject to this Agreement becoming irrevocable in accordance with Section 15, the Company shall provide the following payments and benefits to Executive (subject to applicable withholdings):
(a)    any accrued but unpaid base salary of Executive for services rendered prior to the Separation Date, payable within 30 days of the Separation Date (and subject to applicable withholdings);

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(b)    reimbursement in accordance with the Company’s policies of any unpaid reasonable business expenses and disbursements incurred by Executive prior to the Separation Date; provided, however, that Executive must submit vouchers for any such expenses in accordance with the Company’s standard procedures within fourteen (14) days after the Separation Date;
(c)    no later than March 15, 2014, in lieu of any Incentive Compensation (as defined in the Employment Agreement) for 2013, payment of a lump sum amount equal to the Incentive Compensation (if any) for 2013 payable to Executive in accordance with Section 3(b) of the Employment Agreement (subject to applicable withholdings);
(d)    no later than March 11, 2015, in full satisfaction of Executive’s entitlements   under the Asia-Pacific Business Incentive Compensation Program  (the “Program”), payment of a lump sum amount equal to the product of (i) 36.7%, (ii) the Final Incentive Compensation Pool (as defined in the Program) (if any), and (iii) a fraction, the numerator of which is 1,096, and the denominator of which is 1,461 (subject to applicable withholdings);
(e)    subject to Section 7.6 of the Employment Agreement, and except to the extent otherwise provided at the time of grant under the terms of any equity award made to Executive, full vesting of all unvested restricted stock units (“RSUs”) held by Executive as of the Separation Date, and, in all other respects, all such RSUs shall be governed by the plans and programs and the agreements and other documents pursuant to which such awards were granted; and
(f)    if Executive elects to continue COBRA coverage under the Company’s group health plan in accordance with COBRA, the monthly premiums for such coverage for a period of eighteen (18) months (based on Executive’s current coverage elections), such amount to be paid by the Company directly to the provider during such period (thereafter, Executive will be responsible for paying the entire COBRA premium).  As soon as reasonably practicable following the Separation Date, the Company will provide Executive with timely and adequate notice of Executive’s right to continue group insurance benefits under COBRA.
For the avoidance of doubt, in the event of Executive’s death prior to the time when all payments under this Section 2 have been made, Executive’s estate shall receive such payments not already paid to Executive in accordance with this Section 2.
3.    General Release of Claims.  
(a)    In consideration of the Company’s promises, covenants and agreements set forth in this Agreement, including the payment and benefits set forth in Section 2(c) through (f), which Executive hereby acknowledges are not otherwise owed to Executive but for Executive’s release of Claims (as defined below) set forth herein, and for other good and valuable consideration, receipt of which is hereby acknowledged, Executive hereby knowingly, voluntarily and irrevocably releases, waives and forever discharges, to the fullest extent permitted by law, on Executive’s own behalf and on behalf of Executive’s agents, assignees, attorneys, heirs, executors, administrators and anyone else claiming by or through Executive (collectively, the “Releasors”), the Company and each of its affiliates, subsidiaries, predecessors, successors and assigns, and each of its and their respective past or present stockholders, members and other equity holders, and each of its and their respective past or present directors, managers, executives, officers, insurers, attorneys, employees, consultants, agents and employee benefits plans, and trustees, fiduciaries, and administrators of those plans (collectively, the “Released Parties”), of and from any and all claims, charges, complaints, liens, demands, causes of action, obligations, damages (including consequential, punitive or exemplary damages), liabilities or the like of whatever nature (including attorneys’ fees and costs), whether under local, state or federal law or equity or otherwise, whether known or unknown, and whether asserted and unasserted (collectively, “Claims”), that Executive and/or any of the other Releasors have or may have against any of the Released Parties arising on or prior to the Effective Date or in any way relating to or arising out of any 

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aspect of Executive’s employment with the Company, separation from employment with the Company or Executive’s treatment by the Company while in the Company’s employ, including all Claims for or related to:
(i)    salary and other compensation or benefits, including overtime if applicable, incentive (cash or equity) compensation, bonuses, severance pay or vacation pay, or any benefits under the Employee Retirement Income Security Act of 1974, or any other local, state or federal law; 
(ii)    discrimination, harassment or retaliation based upon race, color, national origin, ancestry, religion, marital status, sex, sexual orientation, citizenship status, pregnancy or any pregnancy-related disability, family status, leave of absence (including the Family Medical Leave Act or any other federal, state or local leave laws), handicap (including The Rehabilitation Act of 1973), medical condition or disability, or any other characteristic covered by law under Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans with Disabilities Act, Sections 1981 through 1988 of the Civil Rights Act of 1866, and any other federal, state, or local law prohibiting discrimination in employment, the Worker Adjustment and Retraining Notification Act, or any other federal, state or local law concerning plant shutdowns, mass layoffs, reductions in force or other business restructuring;
(iii)    discrimination, harassment or retaliation based upon age under the Age Discrimination in Employment Act as amended by the Older Workers Benefit Protection Act of 1990 (the “ADEA”), or under any other federal, state, or local law prohibiting age discrimination;
(iv)    matters arising under the Sarbanes-Oxley Act of 2002 and any other federal, state or local whistleblower laws;
(v)    breach of implied or express contract (whether written or oral), breach of promise, misrepresentation, fraud, estoppel, waiver or breach of any covenant of good faith and fair dealing, including breach of any express or implied covenants of or under the Employment Agreement;
(vi)    defamation, negligence, infliction of emotional distress, violation of public policy, wrongful or constructive discharge, or any employment-related tort recognized under any applicable local, state, or federal law;
(vii)    any violation of any Fair Employment Practices Act, Equal Rights Act, Civil Rights Act, Minimum Fair Wages Act, Payment of Wages Act or any comparable federal, state or local law;
(viii)    any violation of the New York State Human Rights Law, New York Labor Act, New York Equal Pay Act, New York City Human Rights Law, New York Civil Rights Law, New York Rights of Persons with Disabilities Law, New York Sexual Orientation Non-Discrimination Act, New York Equal Rights Law, the New York State Workers’ Compensation and Disability Benefit Laws (including the retaliation provisions thereof), and New York City Administrative Code and Charter, or any comparable federal, state or local law; 
(ix)    any violation of the Connecticut Family and Medical Leave Act, Conn. Gen. Stat. §31-51kk et seq., the Connecticut Fair Employment Practices Act, Conn. Gen. Stat. (Rev. 1958, Supp. 2003), §46a-51 et seq., the Connecticut and Federal Wage and Hour Laws as allowed by law, Conn. Gen. Stat. §31-51m and §31-51q, the Connecticut Whistleblower Law, Conn. Gen. Stat. § 31-51m, the Connecticut Free Speech Law, Conn. Gen. Stat. § 31-51q, the Connecticut OSHA, as amended, the Connecticut Equal Pay Law, Conn. Gen. Stat. § 31-58(e) et seq.; §§ 31-75 and 31-76, Connecticut Drug Testing Law, Conn. Gen. Stat. § 31-51t et seq., the Connecticut AIDS Testing and 

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Confidentiality Law, Conn. Gen. Stat. § 19a-581 et seq., the Connecticut Age Discrimination and Employee Benefits Law, Conn. Gen. Stat. § 38a-543, the Connecticut Reproductive Hazards Law, Conn. Gen. Stat. § 31-40g et seq., the Connecticut Smoking Outside the Workplace Law, Conn. Gen. Stat. § 31-40s, the Connecticut Electronic Monitoring of Employees, Conn. Gen. Stat. § 31-48b and d, the Connecticut statutory provisions regarding protection of social security numbers and personal information, Conn. Gen. Stat. § 42-470 et seq., the Connecticut law concerning consumer privacy and identity theft, Conn. Gen. Stat. § 42-470 et seq., the Connecticut law preventing the use of credit scores by certain employers in hiring decisions, (originally P.A. 11-223), and the Connecticut Paid Sick Leave Law (originally P.A. 11-52), and any claim or charge of retaliation under any federal or state law, including Connecticut General Statutes §31-290a and Connecticut Wage and Hour Laws, Conn. Gen. Stat. §31-69b;
(x)    costs, fees, or other expenses, including attorneys’ fees; and
(xi)    any other Claim of any kind whatsoever, including any claim that this Agreement was induced or resulted from any fraud or misrepresentation by the Company.
Notwithstanding the foregoing, Executive is not hereby releasing, waiving or discharging: (i) any Claims or rights to enforce this Agreement against the Company; (ii) any Claim for indemnification by the Company pursuant to Section 8 of the Employment Agreement or under the Company’s certificate of incorporation or bylaws, in each case, to the extent provided therein; and (iii) any Claims that Executive cannot lawfully release.  Notwithstanding the foregoing, Executive is also not hereby releasing, waiving or discharging Executive’s right to file a charge with an administrative agency (including the Equal Employment Opportunity Commission and the National Labor Relations Board) or participate in any agency investigation.  Executive is, however, hereby releasing, waiving and forever discharging Executive’s right to recover money or other damages in connection with any such charge or investigation.  Executive is also hereby releasing, waiving and forever discharging Executive’s right to recover money in connection with a charge filed by any other individual or by the Equal Employment Opportunity Commission, National Labor Relations Board or any other federal, state or local agency.
(b)    BY AGREEING TO THE RELEASE CONTAINED IN THIS AGREEMENT EXECUTIVE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ANY RIGHTS (KNOWN OR UNKNOWN) TO BRING OR PROSECUTE A LAWSUIT OR MAKE ANY LEGAL CLAIM AGAINST ANY OF THE RELEASED PARTIES WITH RESPECT TO ANY OF THE CLAIMS RELEASED, WAIVED OR DISCHARGED IN SECTION 3(A).  Executive agrees that the release set forth herein will bar all Claims of every kind, known or unknown, released, waived or discharged in Section 3 and further agrees that no non-governmental person, organization or other entity acting on Executive’s behalf has in the past or will in the future file any lawsuit, arbitration or proceeding asserting any Claim that is released, waived or discharged under this Agreement.  If Executive initiates, files or pursues a lawsuit, arbitration or other proceeding asserting any Claim released, waived or discharged under this Agreement: (i) Executive will pay for all costs, including reasonable attorneys’ fees, incurred by any of the Released Parties in defending against such Claim (unless such Claim is a charge with the Equal Employment Opportunity Commission or the National Labor Relations Board); (ii) Executive gives up any right to damages in connection with any administrative, arbitration or court proceeding; and (iii) if Executive is awarded damages, Executive will assign to the Company Executive’s right, title and interest in and to all such damages.  Notwithstanding the foregoing, this Section 3(b) does not limit Executive’s right to challenge the validity of this Agreement in a legal proceeding under the Older Workers Benefit Protection Act, 29 U.S.C. § 626(f), with respect to claims under the ADEA.  This Section 3(b) also is not intended to and shall not limit the right of a court to determine, in its discretion, that the Company is entitled to restitution, recoupment or setoff of any payments made to Executive by the Company should this Agreement be found to be invalid as to the release of claims under the ADEA.  

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(c)    Executive agrees that Executive shall not solicit, encourage, assist or participate (directly or indirectly) in bringing any Claims against any of the Released Parties by other current or former employees, officers or other third parties, except as compelled by subpoena or other court order or legal process, and only after providing the Company with prior notice of any such subpoena, order or legal process and an opportunity to timely contest such process.
(d)    Executive represents, warrants and agrees that Executive has not filed, instituted, prosecuted or maintained any administrative, judicial or other Claim, suit or legal or other proceeding against any of the Released Parties, and that Executive will not file, institute, prosecute or maintain such a Claim, suit or proceeding at any time hereafter based on any events, actions or omissions occurring on or prior to the Effective Date.  Executive understands and agrees that this Agreement will be pleaded as a full and complete defense to any such Claim, suit or proceeding that is or may be filed, instituted, prosecuted or maintained by Executive or any other Releasor.
4.    Affirmations.  Executive hereby acknowledges and agrees that:
(a)    Executive has no known workplace injuries or occupational diseases that Executive has not reported to the Company in writing and Executive either has been provided or Executive has not been denied any leave requested under the Family and Medical Leave Act or under any applicable Company policy or any local, state, or federal law;
(b)    Executive has not been involved in, has not complained of, and Executive is not aware of: (i) any fraudulent activity; (ii) any uncured failure of the Company’s books, records and accounts to accurately and fairly reflect transactions and dispositions of assets; or (iii) any violations of any gaming, anti-money laundering, anti-corruption, bribery, or competition law, which would form the basis of a claim of fraudulent or illegal activity by the Company or any other Released Party; and
(c)    If Executive breaches the provisions of this Agreement, then the Company will be entitled to an appropriate remedy against Executive, which may include injunctive relief and monetary damages, as well as the return of any payments, reimbursements or benefits Executive has received hereunder, and the payment of the Company’s legal fees. 
5.    Executive’s Cooperation.   
(a)    Executive agrees that Executive will provide reasonable assistance to, and will cooperate with, the Company and its subsidiaries and affiliates with respect to matters or issues which took place or arose during Executive’s tenure with the Company, including any attorney retained by any of them or any other representative acting on their behalf, in connection with any pending or future internal investigation or judicial, administrative or regulatory matter, proceeding or investigation.  The parties acknowledge and agree that such cooperation may include Executive making himself available for meetings, interviews, statements, testimony or the signing of affidavits, and providing to the Company any documents or information in Executive’s possession or under Executive’s control relating to any such litigation, regulatory matter or investigation, provided that any such meeting, interviews, statements or testimony do not unduly interfere with Executive’s work schedule or other post-Company duties.  The Company shall reimburse Executive promptly after Executive submits receipts or other documents reasonably acceptable to the Company for actual out-of-pocket expenses reasonably incurred by Executive and approved by the Company in connection with Executive’s performance under this Section 5 and otherwise in accordance with the Company’s reimbursement policy; provided, however, that Executive shall not be entitled hereunder to any expense reimbursement for a reasonable amount of Executive’s time spent testifying or otherwise cooperating in any matter in which Executive is a defendant in the proceeding or a named subject or target of the litigation, regulatory matter, or investigation.

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(b)    Executive represents and warrants that Executive has and will accurately, completely and truthfully disclose to the Company any and all materials and information requested, including in connection with any pending or future internal investigation or judicial, administrative or regulatory matter, proceeding or investigation involving conduct in which Executive was involved or had knowledge in connection with Executive’s employment with the Company.  In the event of a material breach of this Section 5, Executive agrees that, following delivery of notice of such breach to Executive and provided that Executive has not fully cured such breach to the Company’s reasonable satisfaction within five (5) business days following delivery of such notice (or such shorter period as may be required under the circumstances) or such breach is not curable in the reasonable opinion of the Company, the Company may, in its sole discretion, require Executive to (and, if it so requires, Executive shall) reimburse the Company in full any payments, reimbursements or benefits Executive has received under any provision of this Agreement.   
6.    Confidentiality of Agreement.  The parties agree that it is a material condition of this Agreement that Executive shall keep the terms of this Agreement strictly and completely confidential and that Executive will not directly or indirectly make or issue any private statement, press release or public statement, or communicate or otherwise disclose to any executive or employee of the Company or any of its subsidiaries (past, present or future) or to a member of the general public, the negotiations leading to, or the terms, amounts or facts of or underlying this Agreement, except as may be required by law or compulsory process; provided, however, that (a) Executive may disclose the terms of this Agreement to Executive’s immediate family, attorneys, and accountants or other financial advisors so long as they agree to abide by the foregoing confidentiality restriction and (b) Executive may disclose any information relating to this Agreement that the Company publicly discloses.  For the avoidance of doubt, nothing herein shall prohibit Executive from disclosing a copy of Section 7 of the Employment Agreement to the extent required by Section 7.1(c) of the Employment Agreement.  The Company shall not issue any press release or other public statement disclosing the terms set forth in this Agreement; provided, however, nothing herein shall restrict the Company from disclosing the existence of this Agreement (or the terms hereof) to the extent that the Company deems it necessary or advisable in connection with any applicable law, rule or regulation, including United States securities laws and rules or regulations of a securities exchange.
7.    Return of Company Property.  Executive agrees that Executive has or will surrender to the Company by the Separation Date all Company credit cards, parking cards, security badges, cell or “smart” phones, pagers, Blackberries, computer equipment (including tablet computers) and expense accounts, and that Executive will submit all outstanding travel vouchers, business expenses and the like no later than fourteen (14) days after the Separation Date.  Executive further agrees that Executive has returned or will return to the Company, on or before the Separation Date, and will not keep, maintain or permit any copy of, any other Company property, including any documents, papers, files or records in any media (whether stored on Company or personal property), but not including e-mail personally directed to Executive at the Company’s e-mail address, which may be in Executive’s possession, custody or control. 
8.    Non-Admissions.  The parties recognize that, by entering into this Agreement, neither the Company nor Executive admits, and each specifically denies, any violation of any local, state, federal, or other law, whether regulatory, common or statutory.
9.    Rights After Breach.  Executive agrees that, in the event that Executive materially breaches any provision of this Agreement or otherwise engages in (or, prior to the Effective Date, has engaged in) any other act or omission that has caused or may reasonably be expected to cause injury to the interest or business reputation of the Company, in addition to rights otherwise set forth in this Agreement: (a) following delivery of notice of such breach, act or omission to Executive and provided that Executive has not fully cured such breach or injury to the Company’s reasonable satisfaction within five (5) business days following delivery of such notice (or such shorter period as may be required under the circumstances) or such breach is not curable in the reasonable opinion of the Company, the Company shall have the right to (i) offset or reduce or discontinue any payments, reimbursements, or benefits that he otherwise would be entitled to receive hereunder and (ii) demand repayment of or reimbursement for, and Executive shall immediately repay or reimburse the Company upon demand, any or all payments, 

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reimbursements, or benefits paid or provided to Executive hereunder; and (b) the Released Parties shall be entitled to file counterclaim(s) against Executive in the event of Executive’s breach of the covenant not to sue contemplated by this Agreement and may recover from Executive any repayment or reimbursement not made to the Company, as required by Section 9(a), as well as any and all other resulting actual or consequential damages, including attorneys’ fees and costs.
10.    Waiver of Breach.  One or more waivers of a breach of any covenant, term or provision of this Agreement by any party shall not be construed as a waiver of a subsequent breach of the same covenant, term or provision, nor shall it be considered a waiver of any other then existing or subsequent breach of a different covenant, term or provision.
11.    409A.  The Company makes no representations or warranties 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 (the “Code”), and applicable administrative guidance and regulations.  Section 409A of the Code 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.  To the extent any payments of money or other benefits due to Executive under this Agreement could cause the application of an acceleration or additional tax under Section 409A of the Code, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Section 409A of the Code, or otherwise such payments or other benefits shall be restructured, to the extent possible, in a manner determined by the Company that does not cause such acceleration or additional tax.  To the extent any reimbursements or in-kind benefits due to Executive under this Agreement constitute deferred compensation under Section 409A of the Code, 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 of the Code.  
12.    Enforcement and Arbitration.  
(a)    This Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be wholly performed within that State, without regard to its conflict of laws provisions.  Executive and the Company agree that, except for any 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 disputes arising under or in connection with this Agreement or Executive’s employment with, or separation from, the Company; provided, however, that the Company shall be entitled to commence an action in any court of competent jurisdiction for, and shall be entitled to, injunctive relief in connection with any alleged actual or threatened violation of any Surviving Provision, Section 16 or any other restrictive covenants relating to the Company to which Executive is subject following the Separation Date.  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 any Surviving Provision, Section 16 or any other restrictive covenants relating to the Company to which Executive is subject following the Separation Date, the Company and Executive hereby consent to the jurisdiction of any or all of the following courts: (i) the United States District Court for the Southern District of New York; (ii) the Supreme Court of the State of New York, New York County; or (iii) any other court having jurisdiction; provided, that damages for any alleged violation of any Surviving Provision, Section 16 or any other restrictive covenants relating to the Company to which Executive is subject following the Separation Date, as well as any claim, counterclaim, or cross-claim brought by the Executive or any third party in response to, or in connection with, any court action commenced by the Company seeking 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 that either may now or hereafter have to such jurisdiction, venue, and any defense of inconvenient forum.  Thus, except for the claims excluded above, this Section 12 covers 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 

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termination, or unlawful discrimination on the basis of gender, age, national origin, sexual orientation, marital status, disability, or any other protected status.
(b)    Any arbitration under this Agreement shall be filed exclusively with the American Arbitration Association in New York, New York 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.  Subject to the last sentence of this Section 12(b), 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 pursuant to this Section 12(b), and this Section 12(b) simply governs forum.  The prevailing party in any dispute, controversy or claim arising out of or related to this Agreement (or the Surviving Provisions) shall be entitled to recover its reasonable costs and attorney fees.
(c)    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 THE ARBITRATION PROVISIONS SET FORTH IN THIS SECTION 12.
13.    Severability.  If any provision or term of this Agreement, other than the Executive’s release set forth herein, is held to be illegal, invalid or unenforceable, then such provision or term shall be fully severable, this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never constituted part of this Agreement, and the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Agreement.  Furthermore, in lieu of each such illegal, invalid or unenforceable provision or term, there shall be added automatically as a part of this Agreement another provision or term as similar to the illegal, invalid or unenforceable provision, as may be possible and that is legal, valid and enforceable.
14.    Entire Agreement.  This Agreement constitutes the entire Agreement of the parties, and supersedes all prior and contemporaneous negotiations, prior drafts of this Agreement and other agreements, oral or written, including whatever rights, if any, Executive may have had under the Employment Agreement (it being understood and agreed that the Surviving Provisions and Section 8 of the Employment Agreement shall survive the Separation Date as contemplated hereby and thereby and are incorporated herein by reference).  No representations, oral or written, are being relied upon by either party in executing this Agreement other than the express representations set forth in this Agreement.  This Agreement cannot be changed or terminated unless by express written agreement of the parties.  This Agreement may be executed by each party in separate counterparts, each of which shall be deemed an original and constitute one document.  
15.    Revocation and Effective Date.  Executive may accept this Agreement by delivering to the Company’s Chief Human Resources Officer, 750 Lexington Avenue, 25th Floor, New York, New York 10022, a faxed or PDF copy of this Agreement executed by Executive, no later than 5:00 p.m. Eastern Time on the date that is twenty-one (21) days after this Agreement is initially delivered to Executive, unless a later date and time is mutually agreed (the date, if any, on which Executive executes and delivers a copy of this Agreement being the “Execution Date”), as long as Executive or his counsel delivers to the Company’s Chief Human Resources Officer (or such officer’s designee) within a reasonable time (but no more than three (3) business days) thereafter an two originals of this Agreement executed by Executive on or before the Effective Date.  Executive acknowledges that if Executive does not accept this Agreement in the manner described above, it will be withdrawn and of no effect.  If Executive accepts this Agreement before the end of the twenty-one (21) days permitted, Executive represents that Executive has done so voluntarily and with the advice of Executive’s attorney.  Executive may revoke Executive’s acceptance of this Agreement within seven (7) days of the Execution Date by delivery of written notice to the Company’s Chief 

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Human Resources Officer, by 5:00 p.m. on the seventh (7th) day following the Execution Date.  Executive acknowledges and agrees that, if Executive revokes Executive’s acceptance of this Agreement, Executive shall receive none of the payments or benefits contemplated hereunder and this Agreement shall be null and void, having have no further force or effect, and that this Agreement will not be admissible as evidence in any judicial, administrative or arbitral proceeding or trial.  Executive further acknowledges that if the Company’s Chief Human Resources Officer does not receive from Executive written notice of Executive’s revocation prior to the expiration of seven (7) days of the Execution Date, Executive shall have forever waived Executive’s right to revoke this Agreement, and it shall thereafter have full force and effect as of the eighth (8th) day after the Execution Date (the “Effective Date”).
16.    Non-Disparagement.  At no time shall Executive knowingly make any statement (whether written or oral), or knowingly encourage any other person to make any statement, disparaging the performance, conduct, character or business reputation of the Released Parties or any of them.  Nothing contained herein shall preclude Executive from providing truthful testimony or statements as required by law or legal process or in response to an investigation by a governmental, regulatory or self-regulatory body.
17.    Joint Drafting.  In recognition of the fact that the parties had an 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 either party.
18.    Interpretation.  If any provision of this Agreement conflicts with any provision of the Employment Agreement, the provision of this Agreement shall control and prevail.  When a reference is made in this Agreement to any agreement, contract, document, instrument or other record, such reference shall be to such agreement, contract, document, instrument or other record as it may be amended, modified, supplemented or restated from time to time.  When a reference is made in this Agreement to any person, such reference shall be construed to include such person’s successors and permitted assigns.  The word “will” in this Agreement shall be construed to have the same meaning and effect as the word “shall.”  When a reference is made in this Agreement to a Section or Attachment, such reference shall be to a Section or Attachment 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.  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.  
19.    Acknowledgment.
(a)    By executing this Agreement, Executive acknowledges that (i) Executive has had the opportunity to consider the terms of this Agreement for at least twenty-one (21) days from the date this Agreement has been initially delivered to Executive, and has either considered this Agreement and its terms for that period or has knowingly and voluntarily waived Executive’s right to do so; (ii) Executive has been advised by the Company pursuant to this Agreement to consult with an attorney regarding the terms of this Agreement; (iii) Executive has consulted with an attorney or, in the alternative, waives Executive’s right to do so, regarding the terms of this Agreement; (iv) any and all questions regarding the terms of this Agreement 

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have been asked and answered to Executive’s complete satisfaction; (v) Executive has read this Agreement; (vi) the consideration provided for herein is good and valuable; and (vii) Executive is entering into this Agreement voluntarily, of Executive’s own free will, and without any coercion, undue influence, threat or intimidation of any kind or type whatsoever.  Executive further acknowledges and agrees that any revisions to this Agreement made prior to the Effective Date are not material and shall not be deemed to affect the amount of time Executive has to consider this Agreement, and Executive hereby voluntarily waives additional time for review, if any, with respect to any such revisions.
(b)    Executive hereby acknowledges and confirms that Executive has read all ten (10) pages of this Agreement and hereby freely and voluntarily assents to all the terms and conditions in this Agreement, and signs the same as Executive’s own free act with the full intent of accepting the benefits contemplated hereby in return for releasing the Released Parties from all Claims to the extent contemplated herein.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed on such party’s behalf as of the date written below.

/s/ Michael R. Chambrello                  Date: January 8, 2014
Michael Chambrello

SCIENTIFIC GAMES CORPORATION

By:  /s/ Peter A. Mani                        Date: January 8, 2014
Name:    Peter A. Mani
Title: VP & Chief Human Resources Officer

11Exhibit 10.43 Andrew E. Tomback Employment Agreement

Exhibit 10.43
Employment Agreement

This Employment Agreement (the “Agreement”) is made as of November 22, 2013, by and between Scientific Games Corporation, a Delaware corporation (the “Company” or “SGC”), and Andrew E. Tomback (“Executive”).
 
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 hereto agree as follows.
 
1.    Employment; Term.  The Company hereby agrees to employ Executive, and Executive hereby accepts 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 December 1, 2013 (the “Start Date”) and ending on December 31, 2016, as may be extended in accordance with this Section 1 and subject to earlier termination in accordance with Section 4 hereof.  The Term shall be extended automatically without further action by either party hereto by one (1) additional year (added to the end of the Term), and then on each succeeding annual anniversary thereafter, unless either party hereto shall have given written notice to the other party hereto 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, Duties & Compensation.  During the Term, Executive will serve as Senior Vice President and General Counsel 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 other duties commensurate with your position as otherwise may be assigned to Executive from time to time by the Chief Executive Officer of the Company (the “CEO”), to whom Executive will report, or by the board of directors of the Company (the “Board”).  Subject to Section 4(e) hereof, 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.  The Company and Executive agree  that Executive may continue (i) his current nonprofit/charitable activities as set forth in Exhibit A hereto, (ii) charities approved by the CEO, (iii) to serve on boards or similar bodies with the approval of the CEO and (iv) to oversee his and his family’s passive investments, each in a manner that does not materially conflict or unreasonably interfere with Executive’s responsibilities to the Company. 
 
(a)    Base Salary.  During the Term, Executive will receive a base salary of six hundred fifty thousand U.S. dollars (US$650,000), payable 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 and may not be thereafter decreased.
 
(b)    Incentive Compensation.  Executive shall have the opportunity annually to earn incentive compensation in amounts determined by the Compensation Committee of the Board (the “Compensation Committee”) in accordance with the applicable incentive compensation plan of the Company as in effect from time to time (“Incentive Compensation”).  Under such plan, Executive shall have the opportunity annually (beginning in 2014) 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 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).   For the year 2014, the Executive will receive Incentive Compensation in accordance with the applicable incentive compensation plan of the Company but such Incentive Compensation shall not be less than $300,000.

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(c)    Eligibility for Annual Equity Awards.  Executive shall be eligible (beginning in 2014) 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 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 previously-granted or vested interest of Executive under any such plan or program.  
 
(d)    Expense Reimbursement.  Subject to Section 3(e) hereof, 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 similarly situated Executives 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 four (4) weeks paid vacation per year, holidays and any other time off in accordance with the Company’s policies in effect from time to time.
 
(f)    Sign-On Award.  Provided Executive commences employment with the Company on the Start Date, Executive will be granted on December 5, 2013 one hundred thousand (100,000) Restricted Stock Units and two hundred thousand (200,000) stock options (with an exercise price equal to the average of the high and low sales prices of SGC’s common stock on the trading day immediately prior to the grant date) pursuant to, and subject to Executive’s execution of the Terms and Conditions of Inducement Equity Awards in the form attached hereto as Exhibit B (the “Equity Award Agreement”) (the “Sign-On Award”).  The Equity Award Agreement shall provide that the Sign-On Award shall vest and become exercisable with respect to twenty-five percent (25%) of the shares of SGC common stock subject to such Sign-On Award on each of the first four anniversaries of December 2, 2013, subject to any applicable provisions relating to accelerated vesting and forfeiture as described in this Agreement or the Equity Award Agreement.

(g)    Negotiation and Transition Expenses.  The Company shall pay or reimburse Executive for reasonable legal fees and transition expenses incurred by Executive in connection with this Agreement, subject to the submission of appropriate invoices, up to a maximum of $10,000.
  
3.    Taxes and Internal Revenue Code 409A.
 
(a)    Payment of all compensation and benefits to Executive specified in Section 2 and in Section 4 of this Agreement shall be subject to all legally required and customary withholdings.
 
(b)    To the extent that Section 4 or any other section of this Agreement provides for the payment of non-qualified deferred compensation benefits in connection with a separation of service under Section 409A(2)(a)(i) of the United States Internal Revenue Code (the “Code”),  any termination of Executive’s employment triggering payment of benefits must constitute a “separation from service” under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h) before distribution of such benefits can commence.  To the extent that the termination of Executive’s employment does not constitute a separation of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h) (as the result of further services that are reasonably anticipated to be provided by him to the Company at the time his employment terminates), any benefits payable under Section 4 or under any other section of this Agreement that constitute deferred compensation under Section 409A of the Code shall be delayed until after the date of a subsequent event constituting a separation of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h).  For purposes of clarification, this Section 3(b) shall not cause any forfeiture of benefits on Executive’s part, but shall only act as a delay until such time as a separation from service occurs.
 

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(c)    If at the time of Executive’s “separation from 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 (iii) the deferral of the commencement of any such payments or benefits otherwise payable hereunder as a result of such separation from service is necessary in order to prevent any accelerated or additional tax under Section 409A, then the Company will defer the commencement of the payment of any such payments or benefits hereunder to the extent necessary (without any reduction in such payments or benefits ultimately paid or provided to Executive) until the date that is the business day following the six (6) month anniversary of Executive’s separation from service with the Company (or the earliest date as is permitted under Section 409A).  If any payments or benefits are delayed, the Executive shall receive such payments and benefits in accordance with the terms set forth in Sections 4 (h).
 
(d)    The Company makes no representations regarding the tax implications of the compensation and benefits to be paid to Executive under this Agreement, including, without limitation, under Section 409A and applicable administrative guidance and regulations.  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.  In the event that any provision of this Agreement is ambiguous such that one interpretation of the provision would not impose the excise tax under Section 409A and another interpretation of the provision would impose the excise tax under Section 409A, each party intends that this Agreement be interpreted so the excise tax would not be imposed.  Further, the Company reserves the right to provide compensation and benefits under any plan or arrangement 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 hereunder are deemed to be subject to Section 409A, including payments under Section 4 of this Agreement, Executive consents to the Company adopting such conforming amendments as the Company deems necessary, in its reasonable discretion, to comply with Section 409A (including, but not limited to, delaying payment until six (6) months following termination of employment).  Furthermore, to 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 shall 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 possible, in a manner determined by the Company that does not cause such an accelerated or additional tax.
 
(e)    To the extent any reimbursement or in-kind benefit due to Executive under this Agreement constitutes deferred compensation under Section 409A, any such reimbursement or in-kind benefit shall be paid to Executive in a manner consistent with Treas. Reg. §1.409A-3(i)(1)(iv).
 
(f)    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.
 
(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 (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 the terms of or benefit plans, programs and arrangements set forth or referred to in Section 2(e) hereof in which Executive participated during the Term will be paid under such terms or the terms and conditions of such plans, programs, and arrangements (and agreements and documents thereunder);

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(iii)    except as provided in Section 5.6 hereof, all stock options, restricted stock units and other equity-based awards will be governed by the terms of the plans and programs under which such options, restricted stock units or other awards were granted; and
 
(iv)    reasonable business expenses and disbursements incurred by Executive prior to such termination will be reimbursed in accordance with Section 2(d) hereof.
 
(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 (i) the Standard Termination Payments (including, if applicable, 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), (ii) an amount equal to a pro-rated Incentive Compensation that would have been paid for the year in which Executive dies based on the number of days worked in the year in which Executive dies, when such Incentive Compensation is paid to other senior executives for that year, (iii) any unpaid incentive compensation with respect to a year prior to the year in which Executive dies and (iv) subject to Section 5.6 hereof, at the time of death, accelerated vesting of all of the then unvested RSUs and options awarded as part of the Sign-On Award, provided that the equity will otherwise be governed by the Equity Award Agreement.
.
 (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 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;
 
(ii)    Executive’s base salary paid over a twelve month period in accordance with the Company’s payroll procedures; provided such amount shall be reduced by any disability payments to which Executive may be entitled as a result of any disability plan sponsored or maintained by the Company or its affiliates providing benefits to Executive;

(iii)    an amount equal to a pro-rated Incentive Compensation that would have been paid for the year in which termination occurs based on the number of days worked in the year in which termination occurs, when such Incentive Compensation is paid to other senior executives for that year; 

(iv)    any unpaid Incentive Compensation with respect to a year prior to the year in which the termination occurs; and

(v)    subject to Section 5.6 hereof, at the time of termination, accelerated vesting of all of the then unvested RSUs and options awarded as part of the Sign-On Award, provided that the equity will otherwise be governed by the Equity Award Agreement.

(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 conviction (including conviction on a nolo contendere plea) 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) intentional breach by Executive of any material provision of this Agreement; (iv) material violation by Executive of a material provision of the Company’s Code of Conduct; or (v) 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 

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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 at any time 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:  (i) a material change, adverse to Executive, in Executive’s positions, titles, offices, or duties as provided in Section 2 hereof, 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; (ii) an assignment of any significant duties to Executive which are materially inconsistent with Executive’s positions or offices held under Section 2 hereof; (iii) a material decrease in base salary or material decrease in Executive’s incentive compensation opportunities provided under this Agreement;  (iv) 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; or (v), the Company moves the Executive’s place of assignment (office) more than fifty (50) miles from its immediately preceding location, provided, however, that a termination by Executive for Good Reason under any of clauses (i) through (v) 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 the occurence 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 such termination for Good Reason shall be effective no later than thirty days after the expiration of the Company’s cure period.  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) hereof or due to 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;
 
(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 in either of the two (2) most recent completed fiscal years of the Company but not more than Executive’s Target Bonus for the-then current fiscal year (provided if Executive’s employment is terminated during 2013 or 2014, such amount shall be Executive’s Target Bonus for the then current fiscal year) (such amount under this sub-clause (ii) being the “Severance Amount”), such amount payable over a period of 12 months after such termination in accordance with Section 4(h) of this Agreement;
 
(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 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;

(iv)    any unpaid Incentive Compensation with respect to a year prior to the year in which the termination occurs;

(v)     unless prohibited by, or in violation of, law, 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
 
(vi)    subject to Section 5.6 hereof, at the time of termination, accelerated vesting of 50% of each tranche of the then unvested RSUs and options awarded as part of the Sign-On Award, provided that the equity will otherwise be governed by the Equity Award Agreement.

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(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) hereof 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) hereof, except that, solely in the case of an amount otherwise payable under Sections 4(e)(ii) and (iv) hereof, 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 Executive’s Target Bonus Amount, without duplication) and such amount shall be payable over a period of 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 SGC under Regulation Section 1.409A-3(i)(5), such amount otherwise payable under Section 4(e)(ii) hereof 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 (in reverse order of scheduled payments or vesting, as the case may be, and (unless permitted by Section 409A and Executive elects otherwise) with cash severance reduced first, whole shares reduced next and options reduced last) 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 SGC and any subsidiary or affiliate and any employee benefit plan sponsored or maintained by SGC 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 SGC, directly or indirectly, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of securities of SGC representing at least 40% of the combined voting power of the SGC’s then-outstanding securities; (ii) the stockholders of SGC approve a merger, consolidation, recapitalization, or reorganization of SGC, or a reverse stock split of any class of voting securities of SGC, 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 represented by the voting securities of SGC 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 SGC 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 SGC or such surviving entity or of any subsidiary of SGC or such surviving entity; (iii) the stockholders of SGC approve a plan of complete liquidation of SGC, an agreement for the sale or disposition by SGC 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 SGC’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 that this Agreement expires at the end of the Term, Executive shall not be entitled to receive any compensation or benefits under this Agreement except the Company shall pay or grant to Executive the Standard Termination Payments and, subject to Section 5.6 hereof, at the time of termination, all of the then unvested RSUs and options awarded as part of the Sign-On Award shall immediately vest, provided that the equity will otherwise be governed by the Equity Award Agreement, and solely in the event that this Agreement expires due to the Company’s election to not renew this Agreement in accordance with its terms, Executive shall also receive the following:
 
(1)    an amount equal to Executive’s Incentive Compensation for the full year in which the term expired (when such Incentive Compensation is paid to senior executives in the following year); and
 
(2)    Executive’s Base Salary for one year, paid over the twelve month period following expiration of the Agreement in accordance with the Company’s payroll procedures.

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(h)    Timing of Certain Payments under Section 4.  Payments pursuant to Sections 4(c)(ii), 4(e)(ii) and 4(f) (solely with respect to the amount determined by reference to  Section 4(e)(ii) and subject to the proviso in the first sentence of Section 4(f)), if any, shall be payable in equal installments in accordance with the Company’s standard payroll practices over the applicable period of months contemplated by such Sections following the date of termination (subject to such deductions or amounts to be withheld as required by applicable law and regulations); provided, however, that if and to the extent necessary to prevent any acceleration or additional tax under Section 409A, such payments shall be made as follows:  (i) no payments shall be made for a six-month period following the date of Executive’s separation of service (as defined in Section 409A(a)(2)(B)(i) of the Code) with the Company; (ii) an amount equal to the aggregate sum that would have been otherwise payable during the initial six-month period shall be paid in a lump sum 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 shall be payable 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).  In addition, notwithstanding any other provision with respect to the timing of payments under this Agreement, if and to the extent necessary to comply with Section 409A, any amounts payable following termination of employment in a lump sum, including pursuant to Sections 4(e)(iii) and 4(f) (if the proviso in the first sentence of Section 4(f) of this Agreement is applicable), shall instead be paid six (6) months following the date of Executive’s separation of service (subject to such deductions or amounts to be withheld as required by applicable law and regulations).
 
(i)    No Obligation to Mitigate.  Executive shall have no obligation to mitigate damages pursuant to this Section 4 and any other amount received shall not offset the obligation hereunder except as provide in the next sentence, but shall be obligated to promptly advise the Company regarding obtaining other employment providing health insurance benefits with respect to services provided to another employer during any period of continued payments pursuant to this Section 4.  The Company’s obligation to make continued insurance payments to or on behalf of Executive shall be reduced by any insurance coverage obtained by Executive during the severance period through employment by another entity (without regard to when such coverage is paid).
 
(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, without limitation, 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 provided under this Agreement, under any other 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. 
 
(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 (other than enforcement of this Agreement, rights of indemnification and rights to directors’ and officers’ liability insurance coverage).  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 

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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 hereof.
 
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 industry. In consideration of the amounts that may hereafter be paid to Executive pursuant to this Agreement (including, without limitation, Sections 2 and 4 hereof), Executive agrees that during the Term (including any extensions thereof) and during the Covered Time (as defined in Section 5.1(e) hereof), Executive, alone or with others, will not, directly or indirectly, engage (as owner, investor, partner, stockholder, employer, 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 the foregoing, Executive is not prohibited from practicing law with a law firm that provides legal services to a competing Business, provided that Executive does not directly or indirectly engage in the provision of services to the Competing Business.  The ownership of an interest constituting no more than two percent of the outstanding equity of a publicly traded company shall not be deemed to be a violation of this Section 5.1(a).
 
(b)    In further consideration of the amounts that may hereafter be paid to Executive pursuant to this Agreement (including, without limitation, Sections 2 and 4 hereof), 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 at the time he agrees to take such other employment.  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 

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the Company, its subsidiaries or affiliates) that engages, directly or indirectly, in any Competing Business in the United States or in any other geographic area in which such business was contemplated or planned to be conducted by the Company.
 
(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, without limitation, Sections 2 and 4 hereof) is sufficient 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 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 or 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).  Notwithstanding the foregoing and Section 5.3 hereof, 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, unless prohibited by such Court of agency, 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 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.
 

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(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 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 C 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.  Notwithstanding the foregoing, Executive may retain the contact information contained in his personal rolodex or electronic address book.
 
5.4    Non-disparagement.  The Parties shall not, during the Term (except in the good faith performance of his duties) and thereafter, disparage in any material respect each other and, in the case of Executive, 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 a Party 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 hereof notwithstanding, if Executive willfully and materially fails to comply with Section 5.1, 5.2, 5.3, 5.4, or 5.8 hereof, all options to purchase common stock, restricted stock units and other equity-based awards granted by the Company or any of its affiliates (whether 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 without limitation 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 or SGC’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 

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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, without limitation, 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.
 
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).
 
5.11    Subsequent Agreement.  Notwithstanding the foregoing, in the event that the Company and Executive separately agree in writing after the date hereof (including, without limitation, in any equity award agreement) to restrictive covenants, including covenants relating to non-competition, non-solicitation and/or confidentiality, such covenants will automatically (without any further action by the parties hereto) supersede and replace the corresponding covenants set forth in this Section 5, except to the extent otherwise specifically provided otherwise in such separate agreement.
 
6.    Code of Conduct.  Executive acknowledges that he has read SGC’s Code of Conduct and agrees to abide by such Code of Conduct, as amended or supplemented from time to time, and other policies applicable to employees and executives of SGC or the Company.
 
7.    Indemnification.  The Company shall indemnify and advance reasonable expenses to Executive to the full extent permitted under Delaware law, 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 or a fiduciary of any benefit plan of the foregoing.  The Company will obtain and maintain D&O and professional liability insurance in an amount reasonably determined by the Company’s Board of Directors covering the Executive’s acts during his tenure, but no less than that provided to other officers.  The provision of this Section 7 shall survive the termination of the Term and any termination or expiration of this Agreement.
 
8.    Assignability; Binding Effect.  Neither this Agreement nor the rights or obligations hereunder of the parties hereto 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, or to a successor to its business who assumes this agreement in writing.  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 hereto with respect to the employment of Executive and supersedes all other prior agreements and 

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understandings, both written and oral, between the parties hereto with respect to the subject matter hereof, and no statement, representation, warranty or covenant has been made by either party hereto with respect thereto except as expressly set forth herein.  This Agreement shall not be modified, amended or terminated except by a written instrument signed by each of the parties hereto.  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 hereto charged with giving such waiver.  Waiver by either party hereto of any breach hereunder by the other party hereto shall not operate as a waiver of any other breach, whether similar to or different from the breach waived.  No delay by either party hereto in the exercise of any rights or remedies shall operate as a waiver thereof, and no single or partial exercise by either party hereto 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 hereto 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 hereto 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 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 hereto 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 New York 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 hereof, and the Executive 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 applicable provisions of Section 5.4 and 5.8.  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 hereof, the Company and Executive hereby consent to the jurisdiction of any or all of the following courts: (i) the United States District Court for the Southern District of New York; (ii) the Supreme Court of the State of New York, New York County; or (iii) any other court having jurisdiction; provided that damages for any alleged violation of Section 5 hereof, as well as any claim, counterclaim or cross-claim brought by Executive or any third-party in 

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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, but not limited to, 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.
(ii)    Any arbitration under this Agreement shall be filed exclusively with, and administered by, the American Arbitration Association in New York, New York 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.  Executive understands that he is giving up no substantive rights, and this Agreement 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:  AET
	COMPANY INITIALS:  DLK

 
(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 hereto 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 hereto shall have the same opportunity to present evidence as to the actual intent of the parties hereto with respect to any such ambiguous language without any inference or presumption being drawn against any party hereto.
 
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 Chief Executive Officer, 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.
 

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

	 
	 

	 
	 

	 
	By:
	/s/ David L. Kennedy

	 
	Name
	David L. Kennedy

	 
	Title
	President and Chief Executive Officer

	 
	 

	 
	 

	 
	EXECUTIVE

	 
	 

	 
	/s/ Andrew E. Tomback

	 
	Name
	Andrew E. Tomback

 
     

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