Equity Method Investments

There have been no changes in our equity method investments from those disclosed in Note 10 of the Notes to Consolidated Financial Statements in our 2012 Annual Report on Form 10-K, except as described below.

In December 2012, we formed a consortium with GTECH Corporation ("GTECH") and a subsidiary of the administrator of the Ontario Municipal Employees Retirement System ("OMERS") to bid for a long-term marketing and sales services agreement with the New Jersey lottery. In April 2013, the State issued a notice of intent to award the services agreement to our consortium. The award of the agreement to our consortium was protested by a union that represents certain of the lottery workers. The protest was denied and the union has appealed the denial. In June 2013, the consortium's operating company, Northstar New Jersey Lottery Group, LLC ("Northstar New Jersey"), executed the services agreement and, in connection therewith, made a $120,000 payment to the State. Services under the agreement commenced on October 1, 2013 and are scheduled to end on June 30, 2029. We own a 17.69% equity interest in Northstar New Jersey, which we account for as an equity method investment due to our significant influence through our substantive participating and minority interest protection rights with respect to the entity. In connection with the execution of the services agreement, we contributed approximately $21,200, representing our pro rata share of the $120,000 payment. We are also responsible for our pro rata share of the initial working capital requirements of Northstar New Jersey, of which we contributed approximately $1,100 through September 30, 2013. Since September 30, 2013 we have contributed an additional $7,200 to Northstar New Jersey.

Under the terms of the agreement with the New Jersey lottery, Northstar New Jersey is entitled to receive annual incentive compensation payments to the extent the lottery's net income for the applicable year exceeds specified target levels, subject to a cap of 5% of such net income. Northstar New Jersey is responsible for payments to the State to the extent the lottery net income targets set forth in Northstar New Jersey's successful bid are not achieved, subject to a cap of 2% of the applicable year's net income and a $20,000 shortfall payment credit.

Under separate supply agreements, we provide Northstar New Jersey with instant lottery games and related services and GTECH provides Northstar New Jersey with lottery systems, equipment and related services. Scientific Games has a 30% economic interest (and is responsible for 30% of the capital requirements) associated with these supply arrangements. We own a 30% equity interest in Northstar SupplyCo New Jersey, LLC, an entity we formed with GTECH in connection with these supply arrangements.

We own a 16.5% interest in Hellenic Lotteries S.A., a company we formed with OPAP S.A. and Intralot S.A. In July 2013, an agency of the Greek government granted Hellenic Lotteries S.A. a 12-year concession for the exclusive rights to the production, operation and management of instant ticket and certain traditional lotteries in Greece. Operations under the concession agreement are expected to commence by the end of the first quarter of 2014. In consideration for the concession, Hellenic Lotteries S.A. paid an upfront fee of €190,000 to the Greek government, of which our portion was €31,400. Hellenic Lotteries S.A. will also be responsible for a monthly fee to the Greek government equal to a percentage of gross gaming revenue. In July 2013, we executed an instant ticket supply agreement with Hellenic Lotteries S.A., pursuant to which we will be the exclusive provider of instant tickets and design services to Hellenic Lotteries S.A. and will also be responsible for certain advisory services applicable to all lottery tickets included in the concession.

The combined summary financial information for the nine months ended September 30, 2013 and 2012 is presented for all of our equity method investees during the respective periods.




	Nine Months Ended September 30,
	2013		2012
Revenues	$	656,665	$	716,597
Revenues less cost of revenue	$	291,864	$	323,932
Net income	$	63,811	$	94,660