NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION TO

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION TO ANY PERSON LOCATED OR
RESIDENT IN ANY JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS
DOCUMENT. SEE FURTHER "OFFER AND DISTRIBUTION RESTRICTIONS" BELOW.
GTECH S.p.A.
(formerly known as Lottomatica S.p.A.)
Registered office: Viale del Campo Boario, 56/d – 00154 ROMA, Italy
Rome company's register number: 08028081001
Share Capital: 174,975,393.00 fully paid up
Ordinary shares: 174,975,393 (€1,00 each)
Subject to the direction and coordination of De Agostini S.p.A.
EXPLANATORY NOTE
relating to the
MEETING OF HOLDERS
of
€750,000,000 Subordinated Interest-Deferrable Capital Securities due 2066 (Regulation S ISIN
XS0254095663 and Rule 144A ISIN XS0254095747)
(the "Capital Securities")
of GTECH S.p.A. ("GTECH" or the "Issuer") presently outstanding
This Explanatory Note has been prepared by GTECH for the purposes of the meeting of the holders of the
Capital Securities (the “Holders”) convened, in accordance with the provisions of the trust deed dated 17
May 2006, as supplemented or amended from time to time, made by and between the Issuer and BNY
Mellon Corporate Trustee Services Limited (formerly J.P. Morgan Corporate Trustee Services Limited)
as trustee for the Holders (the "Trust Deed") and the applicable provisions of Italian law, at the offices of
GTECH at Viale del Campo Boario 56/d, 00154 Rome, Italy on 19 January 2015 at 6:00 p.m. (CET) and,
if the quorum is not satisfied, on 20 January 2015 in respect of the first adjourned meeting and 21 January
2015 in respect of the second adjourned meeting, at the same time and location in order to resolve upon
the following:
AGENDA
1.
acknowledgment that Condition 6.7 (Replacement) of the Capital Securities does not apply in
relation to the Offer ("Proposal 1");
2.
approval of amendments to the Conditions and the Trust Deed as set out in the draft
Supplemental Trust Deed to (a) reflect the change in the jurisdiction of incorporation of the
Issuer pursuant to the Merger and to remove provisions which are no longer relevant or
applicable as a result of such change of jurisdiction, including but not limited to those only
applicable to Italian companies; (b) remove commercial terms that are no longer relevant and
amend certain other provisions to align these with the customary terms of similar securities
issued under English law (including amendments to the quorum required to pass an
Extraordinary Resolution and to incorporate certain protections in favour of the Trustee); and (c)
clarify that Condition 6.7 (Replacement) of the Capital Securities is not intended to be a
contractual term of the Capital Securities and is instead only an indication of the Issuer's
intention ("Proposal 2"); and
3.
connected and consequential resolutions.
Proposal 1 together with Proposal 2 are referred to herein as the "Proposals".
Capitalised terms used but not defined in the Agenda above shall have the following meanings:
Conditions
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means the terms and conditions of the €750,000,000 Subordinated InterestDeferrable Capital Securities due 2066 (Regulation S ISIN XS0254095663 and
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Rule 144A ISIN XS0254095747) set out in Schedule 3 of the Trust Deed;
Condition 6.7
(Replacement)
of the Capital
Securities
means Condition 6.7 (Replacement) of the Conditions of the Capital Securities
which, as an exception to the general prohibition to repurchase the Capital
Securities before the maturity date, provides that "The Issuer’s intention is (other
than in relation to a mandatory redemption pursuant to Condition 6.5 above) only
to redeem, repurchase or otherwise acquire the Securities for cash consideration
prior to the Maturity Date if the Issuer has received from parties that are not
members of the Issuer Group cash proceeds at least amounting to such
consideration within a period of six months prior to such redemption, repurchase or
other acquisition from the issue, offer and sale or contribution of (a) Issuer Equity
or (b) other securities which contain terms that are substantially the same as the
Securities in respect of (i) enforcement rights and remedies of holders thereof, (ii)
subordination of such holders’ claims in the event of a liquidation, dissolution or
winding up or Insolvency Proceedings in respect of the Issuer, (iii) initial maturity
and any early redemption provisions, (iv) the payment, deferral or non-payment of
scheduled distributions, (v) scheduled step up in distribution rate, if any, and (vi)
replacement conditions pertaining to early redemption, repurchase or acquisition of
such other securities.";
Invitation
Memorandum
means the Invitation Memorandum in respect of the Capital Securities dated 18
December 2014;
Merger
means the merger by incorporation of the Issuer with and into Holdco, as part of
the acquisition of IGT, where "Holdco" means Georgia Worldwide PLC, a public
limited company incorporated under the laws of England and Wales (company
number: 09127533), and "IGT" means International Game Technology, a Nevada
corporation;
Offer
means the invitation by the Issuer to Holders (subject to the Offer and Distribution
Restrictions set out in the Invitation Memorandum) to tender their Capital
Securities for purchase by the Issuer for cash, on the terms and subject to the
conditions set out in the Invitation Memorandum; and
Supplemental
Trust Deed
means the Supplemental Trust Deed to be entered into by the Issuer and the Trustee
to give effect to and implement the Proposals, which will modify and supplement
the Trust Deed.
The notice of the Meeting (the "Notice") has been published on the website of the Luxembourg Stock
Exchange (www.bourse.lu), the Issuer's website (www.gtech.com – section entitled "Governance –
Documents and Reports – Governance Documents – Shareholders’ and Noteholders’ Meetings – Meeting
of Holders of Capital Securities January 19-20-21, 2015") as well as on the "1info" central storage device
(www.1info.it) and has been distributed to the Holders through Euroclear and Clearstream. An extract
from the Notice has been published in Italian in "Il Sole 24Ore" on 18 December 2014.
Capitalised terms used but not defined in this Explanatory Note shall have the meanings given to them in
the Notice.
Offer and Consent Solicitation
The Offer
As disclosed to the market on 18 December 2014, GTECH launched the invitation to the Holders to
tender any and all Capital Securities for purchase by the Issuer for cash (the "Offer") and the solicitation
of the Holders to consider and, if thought fit, approve the Proposals, by separate Extraordinary
Resolutions pursuant to the Conditions and the Trust Deed (the "Consent Solicitation"). The Offer and
the Consent Solicitation are made on the terms and subject to the conditions contained in the invitation
memorandum dated 18 December 2014 (the "Invitation Memorandum").
Subject to the offer restrictions set out in the Invitation Memorandum, the Offer is being made in respect
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of any and all of the outstanding Capital Securities. If the Issuer accepts any valid tenders of Capital
Securities for purchase pursuant to the Offer, it will accept all such offers that have been made. Capital
Securities that are not accepted for purchase pursuant to the Offer will remain outstanding.
The purchase price payable for the Capital Securities accepted for purchase in the Offer (the "Purchase
Price") will be 105.75 per cent. of the aggregate principal amount of such Capital Securities. In respect of
any Capital Securities accepted for purchase, the Issuer will also pay any interest accrued and unpaid on
the relevant Capital Securities from (and including) the interest payment date for such Capital Securities
immediately preceding 23 January 2015 (the "Settlement Date") to (but excluding) the Settlement Date
(the "Accrued Interest"). The Purchase Price and the Accrued Interest will be paid on the Settlement
Date.
Each Holder which validly offers its Capital Securities for purchase in the Offer by 5:00 p.m. (CET) on 7
January 2015 (and does not subsequently revoke such offer) will, if such Capital Securities are accepted
for purchase, receive on the Settlement Date a further cash payment in addition to the Purchase Price and
the Accrued Interest, as additional consideration for the purchase of the relevant Capital Securities, of
3.00 per cent. of the aggregate principal amount of such Capital Securities.
The total consideration payable to each Holder in respect of Capital Securities validly tendered (and not
validly revoked) and accepted for purchase by the Issuer will be an amount in cash equal to the Purchase
Price together with any applicable Early Tender Premium in respect of the aggregate principal amount of
Capital Securities tendered and delivered by such Holder and accepted by the Issuer for purchase
(rounded to the nearest €1, with €0.005 being rounded upwards) plus the Accrued Interest in respect of
such Capital Securities. Subject to the terms and conditions specified in the Invitation Memorandum
including the Payment Condition being satisfied, the Consent Fee will also be payable for votes in favour
of each Extraordinary Resolution in respect of Tender Instructions submitted by the Consent Expiration
Deadline.
By offering to tender its Capital Securities, a Holder will vote in favour of both Extraordinary Resolutions
at the Meeting provided it has submitted its Tender Instruction by 5:00 p.m. (CET) on 14 January 2015
(the "Consent Expiration Deadline"). Any Tender Instructions received after the Consent Expiration
Deadline will be treated as an offer to tender Capital Securities only and any votes included in such
Tender Instruction will not be taken into account for the purposes of the Meeting. Any such Holder will
not be eligible to receive the Consent Fee.
The Consent Solicitation
Currently, the Issuer is soliciting consents from the Holders to approve the Proposals at the Meeting.
Pursuant to applicable laws, only those Holders who hold Capital Securities through their account with
the Clearing Systems, as certified by the Clearing Systems on the basis of their internal records, at 5:00
p.m. (CET) on 8 January 2015, being the seventh trading day on the Regulated Market of the
Luxembourg Stock Exchange prior to the date of the initial Meeting, are entitled to participate in the
Consent Solicitation.
Subject to the terms and conditions specified in the Invitation Memorandum, including the Payment
Condition (i.e., the payment of the Consent Fee in respect of a vote in favour of an Extraordinary
Resolution is subject to the approval and passing by the Holders of the relevant Extraordinary
Resolution.) being satisfied, the Consent Fee will be payable for votes in favour of each Extraordinary
Resolution. In order to be eligible for the Consent Fee, a Holder must deliver or procure the delivery of a
valid Tender Instruction or a valid Consent Instruction (as the case may be, i.e. an electronic instruction
according to the Invitation Memorandum) including a vote in favour of one or both of the Extraordinary
Resolutions (which is not validly revoked) by the Consent Expiration Deadline.
The Consent Fee will be 0.25 per cent. of the aggregate principal amount of the Capital Securities which
are voted in favour of each Extraordinary Resolution. Accordingly, subject always to satisfaction of the
Payment Condition, a Holder that votes in favour of only one of the Extraordinary Resolutions will,
provided such instruction is not validly revoked, receive the Consent Fee of 0.25 per cent. of the
aggregate principal amount of the Capital Securities which are the subject of such Consent Instruction and
a Holder that votes in favour of both Extraordinary Resolutions will, provided such instruction is not
validly revoked, receive the Consent Fee of 0.25 per cent. of the aggregate principal amount of the
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Capital Securities in respect of each Extraordinary Resolution, resulting in an aggregate Consent Fee of
0.5 per cent. of the aggregate principal amount of the Capital Securities which are the subject of such
Tender Instruction or Consent Instruction.
All valid Tender Instructions submitted by the Consent Expiration Deadline will, subject to as described
in the Invitation Memorandum, include a vote in favour of both Extraordinary Resolutions. As a result,
subject always to satisfaction of the Payment Condition, a Holder who validly submits a Tender
Instruction by the Consent Expiration Deadline will receive a payment of the Consent Fee in respect of its
votes in favour of both Extraordinary Resolutions, provided such instruction is not validly revoked,
resulting in an aggregate Consent Fee of 0.5 per cent. of the aggregate principal amount of the Capital
Securities which are the subject of such Tender Instruction.
Holders are eligible to receive the Consent Fee in connection with a vote in favour of an Extraordinary
Resolution as described above notwithstanding that they have voted against the other Extraordinary
Resolution and are thereby ineligible to receive the Consent Fee in respect of the latter.
No Consent Fee will be payable to Restricted Owners and/or to Holders attending and voting at the
Meeting in person or through a representative, voting against both Extraordinary Resolutions or
abstaining from voting or to any Holder that validly revokes its votes in favour of one or both
Extraordinary Resolutions or to Holders submitting a Tender Instruction or Consent Instruction after the
Consent Expiration Deadline.
In connection with the Meeting, Holders may also request a Voting Certificate to attend and vote at the
Meeting in person or through a representative but will not be eligible for any Consent Fee in respect of
the Extraordinary Resolution being considered at such Meeting.
Further information and details on the Consent Solicitation are provided in the Invitation Memorandum
and questions or requests for additional copies of the Invitation Memorandum may be addressed to Lucid
Issuer Services Limited acting as tender agent and Georgeson S.r.l. acting as information agent.
Background and reasons for Meeting
The Offer, the Consent Solicitation and the Meeting of the Holders of the Capital Securities are being
made in connection with the Transaction (as defined below). The following summary highlights selected
information about the Issuer and the other entities that will effect elements of the Transaction.
GTECH S.p.A.
The Issuer is a corporation (società per azioni) incorporated under the laws of Italy. The predecessor of
the Issuer was founded in 1990 as a consortium organized under the laws of Italy and later converted into
a corporation. The Issuer is one of the leading gaming operators in the world based on total wagers and,
through its subsidiaries, including GTECH Corporation, is a leading B2B provider of lottery and gaming
technology solutions and services worldwide. The Issuer's goal is to be the leading commercial operator
and provider of technology in the regulated worldwide gaming markets by delivering market leading
products and services with a steadfast commitment to integrity, responsibility and growth. The Issuer is
listed on the Italian Stock Exchange under the trading symbol "GTK" and has a Sponsored Level 1
American Depositary Receipt program listed on the United States over the counter market under the
trading symbol "GTKYY". The Issuer provides business-to-consumer and business-to-business products
and services to customers in approximately 100 countries worldwide on six continents and had 8,586
employees at June 30, 2014. The principal executive offices of the Issuer are located at Viale del Campo
Boario 56/d, 00154 Roma, Italy and its telephone number at that address is +39 06 51 899 1.
International Game Technology ("IGT")
IGT is a global gaming company specializing in the design, development, manufacture, and marketing of
casino-style gaming equipment, systems technology, and game content across multiple platforms landbased, online real-money and social gaming. IGT is a leading supplier of gaming entertainment products
worldwide and provides a diverse offering of quality products and services at competitive prices,
designed to enhance the gaming player experience.
IGT was incorporated in Nevada in December 1980 to facilitate its initial public offering in 1981.
Principally serving the U.S. gaming markets when founded, IGT expanded into jurisdictions outside the
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US beginning in 1986. The principal executive offices of IGT are located at 6355 South Buffalo Drive,
Las Vegas, Nevada 89113 and its telephone number at that address is +1 (702) 669-7777.
Georgia Worldwide PLC ("Holdco")
Holdco is a public limited company organized under the laws of England and Wales. Holdco was
incorporated on 11 July 2014 for the purpose of effecting the Merger as a private limited liability
company under the name Georgia Worldwide Limited. On 16 September 2014, Holdco was re-registered
as a public limited company under the name Georgia Worldwide PLC (company number: 09127533).
Holdco has not conducted any business operations other than that incidental to its formation and in
connection with the transactions contemplated by the Merger Agreement (as defined below). Following
the Merger (as defined below), it is expected that Holdco ordinary shares will be listed on the NYSE. The
principal executive offices of Georgia Worldwide PLC are located at 70 Chancery Lane, London, WC2A
1AF, United Kingdom and its telephone number at that address is +44 (0) 203 131 0300. Georgia
Worldwide PLC's registered agent is Elain Corporate Services (UK) Limited, 11 Old Jewry, 6 th Floor,
London, EC2R 8DU, United Kingdom and its telephone number is +44 (0) 207 160 5000.
The Transaction
On 15 July 2014, the Issuer entered into the merger agreement with, inter alios, IGT (the "Merger
Agreement") to acquire IGT through the formation of Holdco, a public limited company incorporated
under the laws of England and Wales named Georgia Worldwide PLC (company number: 09127533).
The acquisition of IGT will be effected by (i) the merger of the Issuer with and into Holdco (the
"Merger"), pursuant to which each issued and outstanding ordinary share of the Issuer, par value €1.00,
will be converted into the right to receive one ordinary share of Holdco, nominal value US$0.10 ("Holdco
ordinary shares"), the Merger being more fully described in the Common Cross-Border Merger Terms
(Progetto Comune di Fusione Transfrontaliera); and (ii) immediately thereafter, the merger of Sub with
and into IGT (the "Sub Merger"), with IGT surviving as a wholly-owned subsidiary of Holdco, in each
case subject to the terms and conditions of the Merger Agreement.
In connection with the Merger, the Issuer intends that certain steps will be taken, including (i) the transfer
by the Issuer of all or part of its assets and liabilities relating to its Italian businesses (including the Lotto
concession) to a new Italian subsidiary; (ii) the transfer by the Issuer of its equity interest in its existing
Italian subsidiaries to an additional new Italian subsidiary; (iii) the merger of Invest Games S.A. with IGT,
which will result in Invest Games S.A. ceasing to exist; and (iv) the Capital Reduction (as described
below), these steps (i) to (iv), together with the Merger, are referred to herein as the "Transaction".
The Merger is a cross-border merger within the meaning of EU Directive 2005/56/EC of the European
Parliament and Council of 26 October 2005 on cross-border Merger of limited liability companies,
implemented in the United Kingdom by the Companies (Cross-Border Merger) Regulations 2007, as
amended (the "UK Regulations") and in Italy by the Italian Legislative Decree of 30 May 2008, no. 108
(the "Decree 108/08"). The Common Cross-Border Merger Terms (Progetto Comune di Fusione
Transfrontaliera) have been prepared by the administrative bodies of each of Holdco and the Issuer in
order to execute the Merger within the terms of the UK Regulations and the Decree 108/08.
The following summary of the key effects of the Merger has been taken from The Common Cross-Border
Merger Terms (Progetto Comune di Fusione Transfrontaliera) which Holders should consult for the full
details of the key steps and effects of the Merger and which is available for inspection as described in the
Invitation Memorandum.
Summary of the Key Effects of the Merger
On the Holdco Merger Effective Date (i.e., the date fixed as the effective date of the Merger by an order
of the High Court of England and Wales, as the competent English authority) and by virtue of the Merger:
(a)
all of the assets and liabilities of the Issuer will be transferred to Holdco;
(b)
the Issuer will be dissolved without going into liquidation;
(c)
the Issuer's shareholders will become shareholders of Holdco on the terms and subject to the
conditions set out in the Common Cross-Border Merger Terms (Progetto Comune di Fusione
Transfrontaliera);
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(d)
all legal proceedings pending, if any, by or against the Issuer will be continued with the
substitution of Holdco for the Issuer as a party;
(e)
every contract, agreement or instrument to which the Issuer is a party shall, notwithstanding
anything to the contrary contained in that contract, agreement or instrument, be construed and
have effect as if (i) Holdco had been a party thereto instead of the Issuer; (ii) for any reference
(however worded and whether express or implied) to the Issuer there were substituted a reference
to Holdco; and (iii) any reference (however worded and whether express or implied) to the
directors, officers, representatives or employees of the Issuer, or any of them, were, respectively,
a reference to the directors, officers, representatives or employees of Holdco or to such director,
officer, representative or employee of Holdco as Holdco nominates for that purpose or, in default
of nomination, to the director, officer, representative or employee of Holdco who corresponds as
nearly as may be to the first-mentioned director, officer, representative or employee;
(f)
every contract, agreement or instrument to which the Issuer is a party will become a contract,
agreement or instrument between Holdco and the counterparty with the same rights, and subject
to the same obligations, liabilities and incidents (including rights of set-off), as would have been
applicable thereto if that contract, agreement or instrument had continued in force between the
Issuer and the counterparty, and any money due and owing (or payable) by or to the Issuer under
or by virtue of any such contract, agreement or instrument shall become due and owing (or
payable) by or to Holdco instead of the Issuer;
(g)
any offer made to or by Issuer before the Holdco Merger Effective Date will be construed and
have effect, respectively, as an offer made to or by Holdco; and
(h)
the powers of attorney issued by the Issuer shall remain valid and in force unless they are
expressly revoked by Holdco.
The Capital Reduction
Following completion of the Merger, since Holdco will not otherwise have any distributable reserves, it is
intended that Holdco will capitalise the merger reserves created as a result of the Merger and implement a
parallel court-approved reduction of that capital in order to create a distributable reserve of an equivalent
amount to facilitate the payment of possible future distributions. The Capital Reduction shall not oblige
Holdco to distribute or otherwise make any payment to Holdco shareholders.
Description of Capitalisation of Holdco post the Transaction
The Transaction and related costs incurred by the Issuer as well as the backstop of existing notes and
drawn credit facilities of both the Issuer and IGT are financed through a 364-day committed senior bridge
term loan credit facility entered into by the Issuer on 15 July 2014 in an aggregate principal amount of up
to approximately US$10,700,000,000. As of 12 December 2014, the aggregate financing commitments
under such bridge facility had been reduced to approximately US$6,100,000,000 as a result of several
events reducing the potential need for such financing. The facility is expected to be refinanced principally
through the issuance of euro and U.S dollar denominated bonds, and can be extended by up to 18 months.
The expected leverage of Holdco at closing of the Transaction has previously been announced by the
Issuer at 4.5x to 4.9x net debt / EBITDA excluding synergies (assuming 0 per cent. and 20 per cent.
exercise of Issuer shareholder withdrawal rights respectively; assuming full redemption of outstanding
debt securities of the Issuer including payment of applicable redemption premia and full repurchase of
outstanding debt securities of IGT at a 101 per cent. change of control premium; assuming a 31 December
2014 closing of the Transaction; and on the basis that expected EBITDA is based on actual results
through end of March 2014 and the Issuer's estimates for future periods), with synergy run rates expected
to reduce such expected leverage of Holdco by 0.5x to 0.6x. There can be no assurance that some or all of
these assumptions will be accurate.
Since the announcement of the Transaction, the successful consent solicitation by IGT in respect of the
US$500,000,000 7.50 per cent. Notes due 2019 issued by IGT ensures that these notes can remain
outstanding and will not be redeemed. The successful consent solicitation by the Issuer in respect of the
€500,000,000 5.375 per cent. Guaranteed Notes due 2 February 2018 (the "2018 Notes") and the
€500,000,000 3.500 per cent. Guaranteed Notes due 5 March 2020 (the "2020 Notes") ensures that the
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2018 Notes and the 2020 Notes can also remain outstanding and will not be redeemed. Additionally, the
Issuer has redeemed the €750,000,000 5.375 per cent. Guaranteed Notes due 5 December 2016. The
Capital Securities do not require the consent of the holders of such Capital Securities in connection with
the Transaction however, the Issuer is seeking the consent of Holders to the Proposals as described below
under "Description of the Proposals".
The Issuer approved its 30 September 2014 financial statements on 10 November 2014 and such financial
statements are available on the Issuer's website (www.gtech.com).
Certain Conditions to the Completion of the Merger and Sub Merger; Termination Rights
There is no guarantee that the conditions precedent to the Merger and Sub Merger will be fulfilled and
that either the Merger or Sub Merger will be completed. The obligations of the Issuer and IGT to
complete the Merger and Sub Merger are subject to satisfaction or waiver (if permitted) of a number of
conditions, including, among other conditions, (i) the Issuer and IGT obtaining shareholder approvals, (ii)
receipt of certain antitrust approvals, (iii) receipt of certain gaming regulatory approvals, (iv)
effectiveness of the registration statement for the Holdco ordinary shares, (v) NYSE listing approval for
the Holdco ordinary shares, (vi) the expiration or early termination of a 60-day Issuer creditor opposition
period, (vii) the absence of any order prohibiting or restraining the Merger or Sub Merger, (viii) subject to
certain materiality exceptions, the accuracy of each party's representations and warranties in the Merger
Agreement and performance by each party of their respective obligations under the Merger Agreement,
(ix) the receipt of a merger order from the High Court of England and Wales and (x) in the case of IGT's
obligation to close the Sub Merger, IGT's receipt of certain tax opinions.
In addition, if each of the Merger and Sub Merger is not completed on or before 15 July 2015 (subject to
certain extension rights), either the Issuer or IGT may choose not to proceed with the Merger or Sub
Merger (as applicable). The Issuer may also terminate the Merger Agreement under certain circumstances,
including among others, (i) if Holdco would, as a result of a change in applicable law, be treated as a
domestic corporation for U.S. federal income tax purposes as of or after the completion of the Merger or
Sub Merger (as applicable) or (ii) if the special voting shares provided for by Holdco's Articles of
Association cannot be implemented under certain circumstances. IGT may also terminate the Merger
Agreement under certain circumstances including, among others in order to enter into an agreement with
respect to a proposal that is determined by IGT's board of directors to be superior to the Merger
Agreement, subject to the terms and conditions of the Merger Agreement (including an opportunity for
the Issuer to match any such proposal).
Pre and Post Group Structure
The following diagrams illustrate in simplified terms the current structure of the Issuer and IGT and the
expected structure of Holdco following the completion of the Merger and Sub Merger.
Pre-Transaction Structure
Public
Shareholders
(International
Game Technology )
Public
Shareholders
(GTECH S .p.A .)
De Agostini
S.p .A .
International
Game Technology
GTECH
S .p.A .
Invest
Games S.A.
GTECH S .p.A .
Non - Italian
Subsidiaries
GTECH S .p .A .
Italian
Subsidiaries
Subsidiaries
GTECH
Holdings
Corporation
GTECH
Corporation
GTECH
Corporation
Subsidiaries
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Post-Transaction Structure
Public
Shareholders
(GTECH S.p.A. and
International Game
Technology)
De Agostini
S.p.A.
Georgia
Worldwide
PLC
International
Game
Technology
International Game
Technology
Subsidiaries
GTECH S.p.A.
Italian
HoldCo
GTECH S.p.A.
Non-Italian
Subsidiaries
GTECH S.p.A.
Italian
OpCo
GTECH
Holdings
Corporation
GTECH S.p.A.
Italian
Subsidiaries
GTECH
Corporation
GTECH
Corporation
Subsidiaries
Description of the Proposals
The terms and conditions of the Capital Securities do not require the consent of the Holders in connection
with the Transaction, however, in order to make certain changes to the Capital Securities to facilitate and
simplify their operation going forward, the Issuer is seeking the consent of Holders to the Proposals, inter
alia, to:
(i)
acknowledge that Condition 6.7 (Replacement) of the Capital Securities does not apply in
relation to the Offer ("Proposal 1"); and
(ii)
approve amendments to the Conditions and the Trust Deed as set out in the draft Supplemental
Trust Deed to (a) reflect the change in the jurisdiction of incorporation of the Issuer pursuant to
the Merger and to remove provisions which are no longer relevant or applicable as a result of
such change of jurisdiction, including but not limited to those only applicable to Italian
companies; (b) remove commercial terms that are no longer relevant and amend certain other
provisions to align these with the customary terms of similar securities issued under English law
(including amendments to the quorum required to pass an Extraordinary Resolution and to
incorporate certain protections in favour of the Trustee); and (c) clarify that Condition 6.7
(Replacement) of the Capital Securities is not intended to be a contractual term of the Capital
Securities and is instead only an indication of the Issuer's intention ("Proposal 2").
In respect of Proposal 1, Condition 6.7 provides that (other than in relation to a mandatory redemption set
out under the Terms and Conditions) the Issuer’s intention is only to redeem, repurchase or otherwise
acquire the Capital Securities for cash consideration prior to the maturity date if the Issuer has received
from parties that are not members of its Group cash proceeds at least amounting to such consideration
within a period of six months prior to such redemption, repurchase or other acquisition from the issue,
offer and sale or contribution of its financial instruments meeting certain requirements. The Issuer is
asking Holders to acknowledge that, in line with the market practice, this is an indication of the Issuer's
general intention and not a contractual term of the Capital Securities. The Issuer will not issue new
similar subordinated securities to replace the Capital Securities in the context of the Offer.
In respect of Proposal 2, as a result of the completion of the Merger, the Issuer will be merged with and
into Holdco, a public limited company incorporated under the laws of England and Wales. Accordingly,
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the provisions of the Terms and Conditions specifically relating to Italian law or practice (such as, for
example, the provisions governing noteholders' meeting) and other references typically included for an
Italian issuer (such as, for example, the qualification of the Capital Securities as "obbligazioni pursuant to
Articles 2410-et seq. of the Italian Civil Code" under Condition 2 (Status)) will no longer be applicable.
In addition, commercial terms that are no longer relevant will be removed and certain other provisions
will be amended to be aligned with the customary terms of similar securities issued under English law
(such as, for example, the definitions of "Change of Control" and "Insolvency Proceedings").
The draft Supplemental Trust Deed including the proposed amendments to the Conditions and the Trust
Deed is available to the Holders of the Capital Securities as set out in the Notice of the Meeting.
***
Proposal 1 will take effect immediately after Extraordinary Resolution 1 has been passed and duly
registered with the competent Companies Register and Proposal 2 will take effect after Extraordinary
Resolution 2 has been passed and duly registered with the competent Companies Register and, at the
completion of the Merger.
The passing of one Extraordinary Resolution is not conditional on the passing of the other Extraordinary
Resolution. As such, the Proposals in respect of one Extraordinary Resolution will be effective if that
Extraordinary Resolution is approved, whether or not the Extraordinary Resolution in respect of the other
Proposal is also approved.
The Proposals are not conditions to the completion of the Merger. If the Proposals are not approved, the
Merger can still be completed.
If one or both of the Extraordinary Resolutions is passed, all Holders will be bound by the Proposals
approved by such Extraordinary Resolution(s), including those that voted against or abstained from
voting on such Proposals.
** *** **
In light of the above, GTECH intends to submit for your approval the following resolutions:
EXTRAORDINARY RESOLUTION 1
"THAT this Meeting of the holders (the "Holders") of the €750,000,000 Subordinated Interest-Deferrable
Capital Securities due 2066 (Regulation S ISIN XS0254095663 and Rule 144A ISIN XS0254095747)
(the "Capital Securities") of GTECH S.p.A., a società per azioni incorporated under the laws of the
Republic of Italy (formerly known as Lottomatica S.p.A.) (the "Issuer"), presently outstanding
constituted by the trust deed dated 17 May 2006 as supplemented or amended from time to time (the
"Trust Deed"), made between the Issuer and BNY Mellon Corporate Trustee Services Limited (formerly
J.P. Morgan Corporate Trustee Services Limited) (the "Trustee") as trustee for the Holders hereby:
(a)
after having authorised the Trustee, the financial advisers of the Issuer and the Trustee and the
legal counsel to the Issuer and the Trustee to attend and speak at this Meeting;
(b)
acknowledged that terms not otherwise defined in this Extraordinary Resolution have the
following meanings:
Capital
Reduction
means the proposed court-approved reduction of capital of Holdco under the
UK Companies Act 2006, expected to be implemented following completion
of the Merger, as set out in the Common Cross-Border Merger Terms
(Progetto Comune di Fusione Transfrontaliera);
Conditions
means the terms and conditions of the €750,000,000 Subordinated InterestDeferrable Capital Securities due 2066 (Regulation S ISIN XS0254095663
and Rule 144A ISIN XS0254095747) set out in Schedule 3 of the Trust
Deed;
Holdco
means Georgia Worldwide PLC, a public limited company incorporated
under the laws of England and Wales (company number: 09127533);
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IGT
means International Game Technology, a Nevada corporation;
Invitation
Memorandum
means the Invitation Memorandum in respect of the Capital Securities dated
18 December 2014;
Merger
means the merger of the Issuer with and into Holdco, as part of the
acquisition of IGT;
Offer
means the invitation by the Issuer to Holders (subject to the Offer and
Distribution Restrictions set out in the Invitation Memorandum) to tender
their Capital Securities for purchase by the Issuer for cash, on the terms and
subject to the conditions set out in the Invitation Memorandum;
Transaction
means the Merger and certain steps which the Issuer intends to be taken in
connection with the Merger, including (i) the transfer by the Issuer of all or
part of its assets and liabilities relating to its Italian businesses (including the
Lotto concession) to a new Italian subsidiary; (ii) the transfer by the Issuer of
its equity interest in its existing Italian subsidiaries to an additional new
Italian subsidiary; (iii) the merger of Invest Games S.A. with IGT, which will
result in Invest Games S.A. ceasing to exist; and (iv) the Capital Reduction;
24 hours
means a period of 24 hours including all or part of a day upon which banks
are open for business in both the place where the relevant meeting is to be
held and in each of the places where the Paying and Transfer Agents have
their specified offices (disregarding for this purpose the day upon which such
meeting is to be held) and such period shall be extended by one period or, to
the extent necessary, more periods of 24 hours until there is included as
aforesaid all or part of a day upon which banks are open for business in all of
the places as aforesaid; and
48 hours
means a period of 48 hours including all or part of two days upon which
banks are open for business both in the place where the relevant meeting is to
be held and in each of the places where the Paying and Transfer Agents have
their specified offices (disregarding for this purpose the day upon which such
meeting is to be held) and such period shall be extended by one period or, to
the extent necessary, more periods of 24 hours until there is included as
aforesaid all or part of two days upon which banks are open for business in
all of the places as aforesaid.
resolves as follows:
(i)
acknowledge that Condition 6.7 (Replacement) of the Capital Securities does not apply
in relation to the Offer ("Proposal 1");
(ii)
to authorise, direct, request and empower the Trustee to concur in, and to execute and do,
all such other deeds, instruments, acts and things as may be necessary or appropriate to
carry out and give effect to this Extraordinary Resolution and Proposal 1;
(iii)
to discharge and exonerate the Trustee from all liability for which it may have become or
may become responsible under the Trust Deed or the Capital Securities in respect of any
act or omission in connection with Proposal 1 or this Extraordinary Resolution; and
(iv)
to sanction and assent to every abrogation, amendment, modification, compromise or
arrangement in respect of the rights of the Holders against the Issuer or any other person
whether such rights shall arise under the Trust Deed or otherwise involved in or resulting
from or to be effected by, Proposal 1 or this Extraordinary Resolution 1."
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EXTRAORDINARY RESOLUTION 2
"THAT this Meeting of the holders (the "Holders") of the €750,000,000 Subordinated Interest-Deferrable
Capital Securities due 2066 (Regulation S ISIN XS0254095663 and Rule 144A ISIN XS0254095747)
(the "Capital Securities") of GTECH S.p.A., a società per azioni incorporated under the laws of the
Republic of Italy (formerly known as Lottomatica S.p.A.) (the "Issuer"), presently outstanding
constituted by the trust deed dated 17 May 2006 as supplemented or amended from time to time (the
"Trust Deed"), made between the Issuer and BNY Mellon Corporate Trustee Services Limited (formerly
J.P. Morgan Corporate Trustee Services Limited) (the "Trustee") as trustee for the Holders hereby:
(a)
after having authorised the Trustee, the financial advisers of the Issuer and the Trustee and the
legal counsel to the Issuer and the Trustee to attend and speak at this Meeting;
(b)
acknowledged that terms not otherwise defined in this Extraordinary Resolution have the
following meanings:
Conditions
means the terms and conditions of the €750,000,000 Subordinated InterestDeferrable Capital Securities due 2066 (Regulation S ISIN XS0254095663
and Rule 144A ISIN XS0254095747) set out in Schedule 3 of the Trust
Deed;
Invitation
Memorandum
means the Invitation Memorandum in respect of the Capital Securities dated
18 December 2014;
24 hours
means a period of 24 hours including all or part of a day upon which banks
are open for business in both the place where the relevant meeting is to be
held and in each of the places where the Paying and Transfer Agents have
their specified offices (disregarding for this purpose the day upon which such
meeting is to be held) and such period shall be extended by one period or, to
the extent necessary, more periods of 24 hours until there is included as
aforesaid all or part of a day upon which banks are open for business in all of
the places as aforesaid; and
48 hours
means a period of 48 hours including all or part of two days upon which
banks are open for business both in the place where the relevant meeting is to
be held and in each of the places where the Paying and Transfer Agents have
their specified offices (disregarding for this purpose the day upon which such
meeting is to be held) and such period shall be extended by one period or, to
the extent necessary, more periods of 24 hours until there is included as
aforesaid all or part of two days upon which banks are open for business in
all of the places as aforesaid.
resolves as follows:
(i)
approve amendments to the Conditions and the Trust Deed as set out in the draft
Supplemental Trust Deed to (a) reflect the change in the jurisdiction of incorporation of
the Issuer pursuant to the Merger and to remove provisions which are no longer relevant
or applicable as a result of such change of jurisdiction, including but not limited to those
only applicable to Italian companies; (b) remove commercial terms that are no longer
relevant and amend certain other provisions to align these with the customary terms of
similar securities issued under English law (including amendments to the quorum
required to pass an Extraordinary Resolution and to incorporate certain protections in
favour of the Trustee); and (c) clarify that Condition 6.7 (Replacement) of the Capital
Securities is not intended to be a contractual term of the Capital Securities and is instead
only an indication of the Issuer's intention ("Proposal 2");
(ii)
to authorise, direct, request and empower the Trustee to concur in, and to execute and do,
all such other deeds, instruments, acts and things as may be necessary or appropriate to
carry out and give effect to this Extraordinary Resolution and Proposal 2;
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(iii)
to discharge and exonerate the Trustee from all liability for which it may have become or
may become responsible under the Trust Deed or the Capital Securities in respect of any
act or omission in connection with Proposal 2 or this Extraordinary Resolution; and
(iv)
to sanction and assent to every abrogation, amendment, modification, compromise or
arrangement in respect of the rights of the Holders against the Issuer or any other person
whether such rights shall arise under the Trust Deed or otherwise involved in or resulting
from or to be effected by, Proposal 2 or this Extraordinary Resolution 2."
Rome, 18 December 2014
GTECH S.p.A.
the Chairman
Disclaimer
This explanatory note must be read in conjunction with the Information Memorandum. This explanatory note and the
Information Memorandum contain important information (including the risk factors described in the Invitation
Memorandum) which should be read carefully before any decision is made with respect to the Offer and the Consent
Solicitation. If any Holder is in any doubt as to the action it should take, it is recommended to immediately seek its own
financial advice, including tax advice relating to the consequences resulting from the Offer and the Consent Solicitation
from its broker, dealer, commercial bank, custodian, trust company, accountholder or other nominee or trustee, solicitor,
accountant or other independent financial or legal adviser. Any Holder whose Capital Securities are held on its behalf by
a broker, dealer, commercial bank, custodian, trust company, accountholder or other nominee or trustee must contact
such entity if it wishes to tender such Capital Securities pursuant to the Offer and the Consent Solicitation. None of the
Issuer, the Dealer Managers, the Trustee, the Principal Paying and Transfer Agent, the Tender Agent or the Information
Agent, or any of their respective directors, officers, employees or agents, makes any recommendation whether Holders
should participate in the Offer or approve the Proposals described in the Invitation Memorandum.
Offer and Distribution Restrictions
This explanatory note and the Invitation Memorandum do not constitute an invitation to participate in the Offer in or from
any jurisdiction in or from which, or to or from any person to or from whom, it is unlawful to make such invitation or for
there to be such participation under applicable securities laws. The distribution of this explanatory note and the Invitation
Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession this explanatory note or
the Invitation Memorandum comes are required by each of the Issuer, the Dealer Managers and the Tender Agent to
inform themselves about and to observe any such restrictions.
United Kingdom
The communication of this explanatory note and the Invitation Memorandum and any other documents or materials
relating to the Offer is not being made, and such documents and/or materials have not been approved, by an authorised
person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, such documents
and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom.
The communication of such documents and/or materials as a financial promotion is only being made to those persons in
the United Kingdom falling within the definition of investment professionals (as defined in Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Financial Promotion Order")) or persons who
are within Article 43(2) of the Financial Promotion Order or any other persons to whom it may otherwise lawfully be
made under the Financial Promotion Order.
France
The Offer is not being made, directly or indirectly, to the public in the Republic of France ("France"). Neither this
explanatory note, the Invitiation Memorandum nor any other documents or materials relating to the Offer have been or
shall be distributed to the public in France and only (i) qualified investors (investisseurs qualifiés) acting on their own
account and all as defined in, and in accordance with, Articles L.411-1, L.411-2 and D.411-1 of the French Code
Monétaire et Financier, and/or (iii) legal entities whose total balance sheet exceeds €5 million, or whose total annual
turnover or revenues exceed €5 million, or which manage assets in excess of €5 million, or whose average annual
headcount exceeds 50 persons, all as defined in, and in accordance with, Articles L. 341-2 1°, L. 411-2, D. 341-1 and D.
411-1 of the French Code Monétaire et Financier, are eligible to participate in the Offer. This explanatory note and the
Invitation Memorandum and any other document or material relating to the Offer have not been and will not be
submitted for clearance to nor approved by the Autorité des marchés financiers.
Italy
None of the Offer, this explanatory note, the Invitation Memorandum or any other documents or materials relating to the
Offer have been or will be submitted to the clearance procedure of the Commissione Nazionale per le Società e la
Borsa ("CONSOB"). The Offer is being carried out in the Republic of Italy as exempted offers pursuant to article 101-bis,
paragraph 3-bis of the Legislative Decree No. 58 of 24 February 1998, as amended (the "Financial Services Act"), and
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article 35-bis, paragraph 4 of CONSOB Regulation No. 11971 of 14 May 1999 (the "Issuer's Regulation"). Holders, or
beneficial owners of the Capital Securities that are located in Italy, can tender some or all of their Capital Securities
pursuant to the Offer through authorised persons (such as investment firms, banks or financial intermediaries permitted
to conduct such activities in Italy in accordance with the Financial Services Act, CONSOB Regulation No. 16190 of 29
October 2007, as amended from time to time, and Legislative Decree No. 385 of September 1, 1993, as amended) and
in compliance with applicable laws and regulations or with requirements imposed by CONSOB or any other Italian
authority. Each intermediary must comply with the applicable laws and regulations concerning information duties vis-àvis its clients in connection with the Capital Securities, the Offer, this explanatory note, the Invitation Memorandum or
any other documents or materials relating to the Offer.
General
Neither this explanatory note, the Invitation Memorandum nor the electronic transmission thereof constitutes an offer to
buy or the solicitation of an offer to tender Capital Securities (and tenders of Capital Securities for purchase pursuant to
the Offer will not be accepted from Holders) in any circumstances in which such offer or solicitation is unlawful. In those
jurisdictions where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer and
the Dealer Managers or any of their respective affiliates is such a licensed broker or dealer in any such jurisdiction, the
Offer shall be deemed to be made by the Dealer Managers or such affiliate, as the case may be, on behalf of the Issuer
in such jurisdiction.
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