Inducement Equity Awards. THIS AGREEMENT, made as of the 3rd day of October, 2011, between SCIENTIFIC GAMES CORPORATION (the “Company”) and Xxxxx X. Xxxxxx (the “Participant”).

Inducement Equity Awards. Promptly, but no later than 35 days following the Effective Date, the Company shall grant to the Executive (i) an award of time-based restricted stock units (the “Inducement RSUs”) having an aggregate grant date fair market value of $500,000 and (ii) an award of performance-based restricted stock units (the “Inducement PRSUs”) having an aggregate grant date fair market value (assuming target performance) of $1,000,000. The Inducement RSUs shall vest in equal installments on each of the first three anniversaries of the date of grant, so long as the Executive continuously is employed by or, with the written consent of the Company, otherwise provides services to, the Company through each vesting date. The Inducement PRSUs shall be subject to both time-based and performance-based vesting (and shall only be fully vested to the extent both time-based and performance-based vesting conditions are met), with (A) the time-based vesting occurring with respect to 50% of the Inducement PRSUs on the second anniversary of the date of grant, an additional 25% of the Inducement PRSUs on the third anniversary of the date of grant, and the final 25% of the Inducement PRSUs on the fourth anniversary of the date of grant, in each case, so long as the Executive is continuously employed by or, with the written consent of the Company, otherwise provides services to, the Company through each such vesting date and (B) the performance-based vesting based on the attainment of specified Company stock price metrics. The Inducement RSUs and Inducement PRSUs shall be subject to the terms of the applicable award agreements evidencing the grant of such awards.

Inducement Equity Awards. As an inducement for Executive to enter into employment with the Company and in reliance on Nasdaq Listing Rule 5635(c), Executive shall, as of the Effective Date, be granted (i) restricted stock units covering a number of shares of the Company’s common stock with a value on the date of grant of $4,900,000 (the “Sign-On Inducement RSUs”), and (ii) restricted stock units covering a number of shares of the Company’s common stock with a value of $1,000,000, which covers the value of forfeited equity awards held by Executive in Executive’s prior employer (the “Make-Whole Inducement RSUs,” and together with the Sign-On Inducements RSUs, the “Inducement RSUs”). In each case, the number of shares subject to each Inducement RSU award will be determined using the twenty (20)-trading day volume weighted average price as of the date immediately prior to the date on which the Company publicly announces Executive’s hire. The Inducement RSUs will be granted pursuant to an award agreement in a form reasonably acceptable to the Compensation Committee and outside of the Company’s 2019 Stock Incentive Plan, as amended and/or restated from time to time (the “Equity Plan”), but will be subject to the terms and conditions of the Equity Plan as if they were granted thereunder.

Inducement Equity Awards. As an inducement for the Executive to accept employment with the Company and enter into this Agreement, the Company will issue to the Executive the following equity awards:

Inducement Equity Awards. As a material inducement for Executive to accept employment with the Company, the Company will make a one-time grant to Executive of restricted stock and options, in the amounts and subject to the vesting criteria set forth on Exhibit B hereto.

Inducement Equity Awards. Promptly, but no later than 35 days following the Effective Date, the Company shall grant to the Executive (i) an award of time-based restricted stock units having an aggregate grant date fair market value of $5,000,000, which shall vest in equal installments on each of the first three anniversaries of the date of grant, so long as the Executive remains continuously employed through each vesting date and subject to the terms below (the “Inducement RSUs”) and (ii) an award of performance-based restricted stock units having an aggregate grant date fair market value (assuming target performance) of $4,000,000, which shall vest based on the attainment of specified Company stock price metrics and Executive’s continuous employment over a period of five years following the date of grant (the “Inducement PRSUs” and, together with the Inducement RSUs, the “Inducement Awards”). The Inducement Awards will be subject to the terms of the applicable award agreements evidencing the grant of such awards. Within 30 days following the Effective Date and prior to the grant of the Inducement RSUs, the Executive shall provide the Company with documentation evidencing the forfeiture of any equity awards granted in connection with his prior employment that were forfeited as a direct result of the termination of his prior employment and his acceptance of employment with the Company under this Agreement, and the Board shall determine the fair market value of such forfeited awards as of the date such awards were forfeited (the “Forfeited Award Value”). If the Forfeited Award Value is less than $7,000,000, the aggregate grant date fair market value of the Inducement RSUs (but not the Inducement PRSUs) to be granted under this Section 3(e) shall be reduced by an amount equal to the difference between $7,000,000 and the Forfeited Award Value. If the Forfeited Award Value is less than $2,000,000, the Company will not grant the Inducement RSUs to the Executive.

Related to Inducement Equity Awards

Equity Awards You will be eligible to receive awards of stock options or other equity awards pursuant to any plans or arrangements the Company may have in effect from time to time. The Board or Committee, as applicable, will determine in its sole discretion whether you will be granted any such equity awards and the terms of any such award in accordance with the terms of any applicable plan or arrangement that may be in effect from time to time.
No Equity Awards Except for grants pursuant to equity incentive plans disclosed in the Registration Statement and the Prospectus, the Company has not granted to any person or entity, a compensatory stock option or other compensatory equity-based award to purchase or receive common stock of the Company or OP Units of the Operating Partnership pursuant to an equity-based compensation plan or otherwise.
Equity Award The Executive will be eligible to receive equity awards, if any, at such times and on such terms and conditions as the Board shall, in its sole discretion, determine.
Company Equity Awards With respect to any stock options, restricted stock or other equity awards (the “Equity Awards”) granted pursuant to any compensation plan of the Company or its Subsidiaries providing for the issuance of Equity Awards (the “Company Plans”), (A) each grant of an Equity Award was duly authorized no later than the date on which the grant of such Equity Award was by its terms to be effective by all necessary corporate action, and (B) each such grant was made in accordance with the terms of the Company Plans and all other applicable laws and regulatory rules or requirements.
Annual Equity Awards Following the first anniversary of the Effective Date, Executive will be granted annual equity awards in an amount determined by the Board. Such awards may be in the form of options, restricted stock units, performance shares, or any other form as approved by the Board.
Equity Grants The Employee shall be granted as soon as practicable on or after the Effective Date, a stock option to purchase 734,900 shares of the Company’s common stock (the “Option”) (which option shall be issued as an incentive stock option to the maximum extent allowed under Section 422 of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder (the “Code”)) pursuant to the Company’s 2011 Employee, Director and Consultant Equity Incentive Plan (the “Plan”). The Option shall be granted with an exercise price equal to the fair market value of the Company’s common stock on the date of grant. Twenty-Five percent (25%) of the Option shall be vested one year from the Effective Date and the remaining portion of such Option shall vest in equal monthly installments over a thirty-six (36) month period commencing on the first day of the month one year following the Effective Date, subject to continued employment by the Company. Notwithstanding the foregoing, in connection with a Change of Control (as defined in the Plan) or if a termination of the Employee occurs within two (2) months prior thereto, then the vesting of all equity then owned by the Employee shall accelerate with respect to one hundred percent (100%) of the unvested shares. In lieu of the Option at the request of the Employee, the Company shall issue restricted common stock. Restricted common stock will be issued at par value. If the equity to be issued is restricted common stock and not stock options, the number of shares of restricted common stock to be issued shall be calculated by determining the black scholes value of the grant as if it had been issued solely as stock options and dividing such number by the then current fair market value of the Company’s common stock so as to provide no additional benefit to the Employee for the non-payment of the exercise price. The Employee acknowledges and agrees that effective as of the date of the grant of the equity as set forth in the preceding paragraph, option agreement No. SP-0040 granted by the Company to the Employee as of April 30, 2011 shall be terminated and of no further force and effect. The Company acknowledges that any other options previously granted to the Employee that vest based upon the Employee providing consulting services to the Company shall continue to vest upon its terms as long as the Employee is providing services as a director, consultant or employee of the Company and that the definition of “cause” applicable to all such option agreements shall be the definition set forth herein and not as set forth in the 2008 Stock Incentive Plan.
Future Equity Awards Executive remains eligible to be considered for future equity awards as may be determined by the Board or a committee of the Board in its discretion in accordance with the terms of any applicable equity plan or arrangement that may be in effect from time to time.
Vested Company Options Immediately prior to but contingent upon the Closing, each Company Option that is unexpired, unexercised and vested immediately prior to the Closing (“Vested Options”) shall, by virtue of the Closing and without the need for any further action on the part of the holder thereof, on the terms and subject to the conditions set forth in this Agreement, be automatically cancelled, and each Optionholder holding Vested Options shall have the right to receive, with respect to such Vested Options, an amount in cash, without interest, equal to such Optionholder’s Pro Rata Share of the Closing Date Purchase Price (subject to withholding of such Optionholder’s Pro Rata Share in each of the Adjustment Holdback Amount, the Expense Fund), and (B) the right to receive such Optionholder’s Pro Rata Share of any cash disbursements that may become payable, with respect to such Vested Options, from the Adjustment Holdback Amount and the Expense Fund, in accordance with the terms of this Agreement, and (C) the right to receive such Optionholder’s Pro Rata Share of any positive Adjustment Amount that may become payable, with respect to such Vested Options, pursuant to Section 2.8, and (D) the right to receive such Optionholder’s Pro Rata Share of any Earnout Consideration that may become payable under this Agreement in accordance with the provisions of Section 2.9. The amount of cash that each holder of Vested Options is entitled to receive for such Vested Options will be subject to any applicable payroll, income Tax or other withholding Taxes and the provisions of the Israeli Tax Ruling and/or the Israeli Interim Tax Ruling if obtained. For the avoidance of doubt, an Optionholder’s “Pro Rata Share” for purposes of this Section 2.2(a) shall be calculated based on such Optionholder’s holding of Vested Options (disregarding any shares of the Company or Unvested Options held by such Optionholder).
Other Equity Awards Except as set forth in Sections 8(a)(iii) and 8(a)(iv), performance share awards and all other equity awards granted to the Executive by the Company which remain outstanding immediately prior to the date of termination of the Executive’s employment, as provided in Section 7(b), shall vest and be settled in accordance with their terms. The Company shall have no further obligations to the Executive as a result of termination of employment described in this Section 8(a) except as set forth in Section 12.
Vesting of Equity Awards Notwithstanding the provisions of any plan or agreement governing such an Award (as defined in Section 4(c)), all Awards granted to you that remain outstanding and unvested immediately prior to the occurrence of a Change in Control (as defined in Section 4(d)(i)) automatically shall vest in full upon the occurrence of the Change in Control.

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