Item 1.01. Entry into a Material Definitive Agreement.
Equity Purchase Agreement
On March 1, 2022, a subsidiary of SciPlay Corporation (the
“Company”) entered into a Purchase Agreement, dated March 1, 2022 (the “Purchase Agreement”), by
and among SciPlay Acquisition, LLC (the “Buyer”), Arif Emre Taş (“AET”), Ecem Baran Taş (“EBT” and together with AET, the “Sellers”), Alictus Yazilim Anonim Şirketi (“Alictus”),
Ecem Baran Taş, acting as the sellers representative, and, solely with respect to certain sections of the Purchase Agreement, SciPlay Games, LLC, a wholly-owned indirect subsidiary of the Company (“SciPlay Games”). Pursuant to the Purchase Agreement, on March 1, 2022, the Buyer acquired 80% of all issued and outstanding share capital
of Alictus (the “First Closing”), with the remaining 20% to be acquired ratably over a five year period for potential additional consideration payable annually based upon the achievement of specified revenue and EBITDA targets by Alictus in respect
of each of calendar years 2022-2026 (the “Remaining Closings” and, together with the “First Closing”, the “Transaction”), subject to and on the terms of the Purchase Agreement, including, in relation to the Remaining Closings, the satisfaction or
waiver of customary closing conditions.
The total consideration to be paid by the Buyer in connection with the Transaction consists of an initial cash purchase price of approximately $100
million (subject to customary adjustments for net debt, transaction expenses and net working capital) paid in connection with the First Closing and an earnout payment of up to an additional $200 million (in the aggregate) in contingent
consideration over a five year period, to be paid in connection with the Remaining Closings.
The Purchase Agreement contains customary representations, warranties and covenants related to the Transaction and customary mutual indemnification
provisions, subject to certain limitations and thresholds, for breaches or inaccuracies in the representations, warranties or covenants. During the period commencing on the date of the First Closing and ending two years after the earlier of the
date of the final of the Remaining Closings and the date on which Buyer becomes the owner of all of the remaining transferred equity interests of Alictus, each Seller agrees to not compete with the business, activities, products or services
conducted, authorized, offered, or provided by Alictus or any of its subsidiaries in the United States, the Republic of Turkey or any other jurisdictions where Alictus conducts business. During the period commencing on the First Closing date and
ending five years after the earlier of the date of the final of the Remaining Closings and the date on which Buyer becomes the owner of all of the remaining transferred equity interests of Alictus, each Seller agrees to not solicit any officer or
employee of Alictus who is an officer or employed by the Alictus as of the First Closing date or otherwise attempt to induce or influence any covered employee to discontinue or reduce his or her employment relationship with Alictus or any customer
or vender of Alictus to discontinue or reduce such customer or vendor’s relationship with Alictus, subject to certain exceptions.
The representations and warranties of Buyer, the Sellers and Alictus contained in the Purchase Agreement have been made solely for the benefit of the
parties to the Purchase Agreement. In addition, such representations and warranties (a) have been made only for purposes of the Purchase Agreement, (b) have been qualified by confidential disclosures made to the other parties in connection with
the Purchase Agreement, (c) are subject to materiality qualifications contained in the Purchase Agreement which may differ from what may be viewed as material by investors, (d) were made only as of the date of the Purchase Agreement or such other
date as is specified in the Purchase Agreement, (e) have been included in the Purchase Agreement for the purpose of allocating risk between the parties rather than establishing matters as facts and (f) expire on the date that is twenty-four months
following the First Closing date (subject to certain exceptions). Accordingly, the Purchase Agreement is included with this filing only to provide investors with information regarding the terms of the Purchase Agreement, and not to provide
investors with any other factual information regarding the Sellers, Alictus, or Buyer or their respective subsidiaries or businesses. Investors should not rely on the representations and warranties or any descriptions thereof as characterizations
of the actual state of facts or condition of the Sellers, Alictus, Buyer or any of their respective subsidiaries, affiliates or businesses. Moreover, information concerning the subject matter of the representations and warranties may change after
the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures.
In connection with the Purchase Agreement, pursuant to a Usufruct Agreement (the “Usufruct Agreement”), the form of which is attached to the Purchase
Agreement as Exhibit A, each Seller established a usufruct right over certain respective equity interests (save for the actual ownership of the equity interests) for the benefit of the Buyer, pursuant to which the respective Seller grants the Buyer
the exclusive right to use and enjoy the benefits of all rights attached to such interests, including but not limited to all financial and economic rights and all voting, governance and managerial rights, subject to certain exceptions as set forth
in the Usufruct Agreement.
The foregoing description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by the full text of the Purchase
Agreement, a copy of which is attached hereto as Exhibit 2.1 hereto, which is incorporated herein by reference.
The Company is in the process of completing the preliminary purchase price accounting related to the Transaction and expects a substantial amount of
the purchase price to be allocated to goodwill and intangible assets. The revenue, earnings and assets associated with the Transaction are not significant to the Company’s historical consolidated financial statements.
Amendment to the Revolving Credit Agreement
On February 28, 2022, SciPlay Games entered into Amendment No. 2 to
that certain revolving credit agreement, dated as of May 7, 2019 (as amended, supplemented, amended and restated or otherwise modified from time to time, including without limitation, by that certain Amendment No. 1, dated as of May 27,
2021, the “Revolver”), by and among SciPlay Games, SciPlay Parent Company, LLC, the several banks and other financial institutions or entities from time to time party
thereto and Bank of America, N.A., as administrative agent, collateral agent and issuing lender (such amendment, “Amendment No. 2”).
Amendment No. 2, among other things, (i) amends certain interest rate provisions relating to Sterling-denominated revolving loans,
(ii) increases SciPlay Games’ and its subsidiaries capacity to acquire non-loan parties and (iii) allows for the acquisition of Alictus, so long as the acquisition is consummated within 90 days of the effective date of Amendment No. 2.
The foregoing description of the Revolver, as amended by Amendment No. 2, does not purport to be complete and is qualified in its
entirety by the full text of Amendment No. 2, a copy of which is attached hereto as Exhibit 10.1, which is incorporated herein by reference.