Scientific Games has requisite noteholder consents for SG Lottery IPO

Chicago, Oct. 1 – Scientific Games International, Inc., a wholly owned subsidiary of Scientific Games Corp., announced that it has received the required consents from noteholders of seven series of notes, according to a press release.

As of the 5 p.m. ET Sept. 30 deadline, Scientific Games received consents from noteholders representing the following amounts of notes from the seven series:

• $1,220,340,000, or 97.63%, of the $1.25 billion outstanding 5% senior secured notes due 2025;

• €294,579,000, or 90.64%, of the €325 million outstanding 3 3/8% senior secured notes due 2026;

• $546,663,000, or 99.39%, of the $550 million outstanding 8 5/8% senior notes due 2025;

• €242.22 million, or 96.89%, of the €250 million outstanding 5½% senior notes due 2026;

• $1,083,744,000, or 98.52%, of the $1.1 billion outstanding 8Ό% senior notes due 2026;

• $669,442,000, or 95.63%, of the $700 million outstanding 7% senior notes due 2028; and

• $485,917,000, or 97.18%, of the $500 million outstanding 7Ό% senior notes due 2029.

The supplemental indentures were executed on Thursday. They will become operative after the consent payment is made.

As previously disclosed and reported, Scientific Games is evaluating strategic alternatives for the intended divestiture of its lottery business, including an initial public offering or combination with a special purpose acquisition company, or a sale or a strategic combination with another business.

The consent solicitation is designed to provide greater flexibility with respect to the equity offered in the potential initial public offering.

The company could have consummated the initial public offering of SG Lottery, if necessary, and comply with the indentures without receiving the required consents.

However, Scientific Games was asking noteholders to amend the indentures’ requirement that at least 75% of the consideration received from an asset sale is cash or cash equivalents to reduce that percentage to 60%, solely with respect to an initial public offering relating to SG Lottery occurring before June 30, 2022.

A substantial portion of the proceeds from an SG Lottery transaction would be used to repay debt of Scientific Games and its restricted subsidiaries.

If there is no initial public offering by June 30, 2022, the proposed amendments will not become operative and there will not be a consent payment.

However, noteholders who consented will receive a pro rata consent fee out of a pool if a consent effective time has occurred and the IPO is consummated.

The pro rata consent fees will be paid out are $3,125,000 for the 5% notes, €812,500 for the 3 3/8% notes, $1,375,000 for the 8 5/8% notes, €625,000 for the 5½% notes, $2,750,000 for the 8Ό% notes, $1.75 million for the 7% notes and $1.25 million for the 7Ό% notes.

Noteholders who did not deliver consents will not receive any part of the consent payment.

Morgan Stanley & Co. LLC (800 624-1808, 212 761-1057) and Goldman Sachs & Co. LLC (800 8228-3182, 212 902-5962, GS-LM-NYC@gs.com) are the solicitation agents.

Global Bondholder Services Corp. is the information, tabulation and paying agent (866 470-3700, 212 430-3774, contact@gbsc-usa.com).

The gaming technology company is based in Las Vegas.

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