UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file no 001 — 32622

GLOBAL CASH ACCESS HOLDINGS, INC.

(Exact name of Registrant as specified in its charter)

DELAWARE		20-0723270
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer I.D. No.)
3525 EAST POST ROAD, SUITE 120 LAS VEGAS, NEVADA		89120
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code:
(800) 833-7110

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer þ		Non-accelerated filer o		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

As of November 2, 2009, there were 70,401,580 shares of the Registrant’s $0.001 par value per share common stock outstanding.

 

 

PART I: FINANCIAL INFORMATION

ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except par value)
(unaudited)

		September 30,				December 31,
		2009				2008
ASSETS
Cash and cash equivalents		$	73,712			$	77,148
Restricted cash and cash equivalents			369				388
Settlement receivables			4,241				51,604
Other receivables, net			17,621				16,759
Prepaid and other assets			11,145				11,867
Assets held for sale			—				1,540
Property, equipment and leasehold improvements, net			20,579				24,419
Goodwill, net			174,328				183,929
Other intangibles, net			29,757				34,982
Deferred income taxes, net			155,992				156,514
Total assets		$	487,744			$	559,150
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Settlement liabilities		$	36,542			$	79,150
Accounts payable			31,947				35,561
Accrued expenses			14,587				17,811
Borrowings			250,000				265,750
Total liabilities			333,076				398,272
COMMITMENTS AND CONTINGENCIES (NOTE 5)
Retained earnings
Common stock, $0.001 par value, 500,000 shares authorized and 84,185 and 82,961 shares issued at September 30, 2009 and December 31, 2008, respectively			83				83
Preferred stock, $0.001 par value, 50,000 shares authorized and 0 shares outstanding at September 30, 2009 and December 31, 2008, respectively			—				—
Additional paid in capital			180,943				172,119
Retained earnings			64,044				37,659
Accumulated other comprehensive income			2,039				1,243
Treasury stock, at cost, 12,632 and 6,017 shares at September 30, 2009 and December 31, 2008, respectively			(92,371	)			(50,226	)
Total Global Cash Access Holdings, Inc. stockholders’ equity			154,738				160,878
Minority interest			(70	)			—
Total stockholders’ equity			154,668				160,878
Total liabilities and stockholders’ equity		$	487,744			$	559,150

See notes to unaudited condensed consolidated financial statements.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(amounts in thousands, except per share)
(unaudited)

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2009				2008				2009				2008
REVENUES
Cash Advance		$	69,741			$	89,102			$	225,899			$	244,320
ATM			81,544				79,863				252,585				210,670
Check Services			9,464				12,962				30,791				31,479
Central Credit and other revenues			3,570				3,132				9,689				8,883
Total revenues			164,319				185,059				518,964				495,352
Cost of revenues (exclusive of depreciation and amortization)			(123,996	)			(136,694	)			(390,662	)			(362,226	)
Operating expenses			(18,595	)			(22,229	)			(58,722	)			(61,681	)
Amortization			(1,883	)			(1,955	)			(6,212	)			(4,546	)
Depreciation			(2,376	)			(2,865	)			(7,338	)			(6,702	)
OPERATING INCOME			17,469				21,316				56,030				60,197
INTEREST INCOME (EXPENSE), NET
Interest income			63				287				262				1,735
Interest expense			(4,463	)			(7,814	)			(13,886	)			(23,034	)
Total interest income (expense), net			(4,400	)			(7,527	)			(13,624	)			(21,299	)
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAX PROVISION			13,069				13,789				42,406				38,898
INCOME TAX PROVISION			(4,966	)			(5,385	)			(16,114	)			(15,976	)
INCOME FROM CONTINUING OPERATIONS, NET OF TAX			8,103				8,404				26,292				22,922
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX			—				156				44				(4,006	)
NET INCOME			8,103				8,560				26,336				18,916
PLUS: NET LOSS ATTRIBUTABLE TO MINORITY INTEREST			12				—				45				86
NET INCOME ATTRIBUTABLE TO GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES			8,115				8,560				26,381				19,002
Foreign currency (gain) loss translation, net of tax			345				(346	)			796				(407	)
COMPREHENSIVE INCOME		$	8,460			$	8,214			$	27,177			$	18,595
Basic net income per share of common stock
Continuing operations		$	0.11			$	0.11			$	0.35			$	0.30
Discontinued operations		$	—			$	—			$	—			$	(0.05	)
Basic net income per share of common stock		$	0.11			$	0.11			$	0.35			$	0.25
Diluted net income per share of common stock
Continuing operations		$	0.11			$	0.11			$	0.34			$	0.30
Discontinued operations		$	—			$	—			$	—			$	(0.05	)
Diluted net income per share of common stock		$	0.11			$	0.11			$	0.34			$	0.25
Weighted average number of common shares outstanding:
Basic			72,182				76,723				75,692				76,801
Diluted			73,845				76,724				76,566				76,801

See notes to unaudited condensed consolidated financial statements.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)

		Nine Months Ended
		September 30,
		2009				2008
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	26,336			$	18,867
Adjustments to reconcile net income to cash provided by operating activities:
Amortization of financing costs			729				729
Amortization of intangibles			6,296				4,546
Depreciation			7,338				6,702
Loss on sale of or disposal of assets			26				—
Provision for bad debts			5,952				14,198
Deferred income taxes			12,358				13,483
Stock-based compensation			6,203				6,690
Changes in operating assets and liabilities:
Settlement receivables			46,804				29,202
Other receivables, net			(2,254	)			(9,234	)
Prepaid and other assets			87				(926	)
Settlement liabilities			(42,083	)			(60,602	)
Accounts payable			(4,011	)			8,660
Accrued expenses			(4,955	)			(7,258	)
Net cash provided by operating activities			58,826				25,057
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of Certegy Gaming Systems, Inc., net of cash			—				(24,819	)
Acquisition of Cash Systems, Inc., net of cash			—				(29,916	)
Purchase of property, equipment and leasehold improvements and other intangibles			(5,297	)			(7,536	)
Other			(18	)			994
Net cash used in investing activities			(5,315	)			(61,277	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under credit facility			—				121,000
Repayments under credit facilty			(15,750	)			(88,480	)
Proceeds from exercise of options			2,621				—
Purchase of treasury stock			(42,028	)			(9,462	)
Net cash (used in) provided by financing activities			(55,157	)			23,058

continued

See notes to unaudited condensed consolidated financial statements.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)

		Nine Months Ended
		September 30,
		2009				2008
NET EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		$	(1,790	)		$	1,492
NET DECREASE IN CASH AND CASH EQUIVALENTS			(3,436	)			(11,670	)
CASH AND CASH EQUIVALENTS — Beginning of period			77,148				71,063
CASH AND CASH EQUIVALENTS — End of period		$	73,712			$	59,393
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest		$	16,889			$	25,371
Cash paid for taxes, net of refunds		$	3,670			$	575

See notes to unaudited condensed consolidated financial statements.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.

BUSINESS AND BASIS OF PRESENTATION

Overview

Global Cash Access Holdings, Inc. is a holding company, the principal asset of which is the capital stock of Global Cash Access, Inc. (“GCA”). Unless otherwise indicated, the terms “the Company,” “we,” “us” and “our” refer to Global Cash Access Holdings, Inc. together with its consolidated subsidiaries and the term “Holdings” refers to Global Cash Access Holdings, Inc. individually. The Company is a provider of cash access products and related services to the gaming industry in the United States and several international markets. Our products and services provide gaming establishment patrons access to cash through a variety of methods, including Automated Teller Machine (“ATM”) cash withdrawals, credit card cash advances, point-of-sale (“POS”) debit card transactions, check verification and warranty services and money transfers. In addition, we also provide products and services that improve credit decision-making, automate cashier operations and enhance patron marketing activities for gaming establishments. The Company also owns and operates a credit reporting agency for the gaming industry through a wholly-owned subsidiary, Central Credit, LLC (“Central”), which provides credit-information services and credit-reporting history on gaming patrons to various gaming establishments. Central operates in both international and domestic gaming markets.

The Company’s cash access products and services enable three primary types of electronic payment transactions: ATM cash withdrawals, credit card cash advances and POS debit card transactions. Consumers can complete any of these transactions of our Casino Cash Plus ATMs enabled with our patented “3-in-1” technology, other ATMs and redemption devices that we operate and are enabled with our patented “3-in-1” technology. In addition, consumers can complete credit card cash advances and POS debit card transactions at any of our QuikCash kiosks, all of which we own. The Company also provides check verification and check warranty services to gaming establishments that cash patron checks.

Basis of Presentation—The unaudited condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Some of the information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary for a fair presentation of results for the interim periods have been made. The results for the three and nine months ended September 30, 2009 are not necessarily indicative of results to be expected for the full fiscal year.

These unaudited condensed consolidated financial statements should be read in conjunction with the annual consolidated financial statements and notes thereto included within the Company’s Annual Report on Form 10-K for the year ended December 31, 2008.

Use of Estimates—The Company has made estimates and judgments affecting the amounts reported in these financial statements and the accompanying notes. The actual results may differ from these estimates. The significant accounting estimates incorporated into the Company’s unaudited condensed consolidated financial statements include:

•

the estimated reserve for warranty expense associated with our check warranty receivables,

•

the valuation and recognition of share-based compensation,

	•		the valuation allowance on our deferred tax asset, and
	•		the estimated cash flows in assessing the recoverability of long-lived assets.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation—The unaudited condensed consolidated financial statements presented for the three and nine months ended September 30, 2009 and 2008 and as of September 30, 2009 and December 31, 2008 include the accounts of Holdings, GCA and GCA’s subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

Earnings Applicable to Common Stock—In accordance with the provisions of General Accepted Accounting Principles (“GAAP”), basic earnings per share is calculated by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted earnings per share reflect the effect of potential common stock, which consists of non-vested shares of restricted stock outstanding and assumed stock option exercises. The weighted-average number of common shares outstanding used in the computation of basic and diluted earnings per share is as follows.

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		(in thousands)								(in thousands)
			2009				2008				2009				2008
Weighted average common shares outstanding — basic (1)			72,182				76,723				75,692				76,801
Potential dilution from equity grants (2)(3)			1,663				1				874				—
Weighted average common shares outstanding — diluted			73,845				76,724				76,566				76,801

Central Credit Check Warranty Receivables—Central warrants check cashing transactions performed at gaming establishments. In the check services transactions provided by Central, if a gaming establishment accepts a payroll or personal check from a patron that we warrant, Central is obligated to reimburse the gaming establishment for the full face value of any dishonored checks and the gaming establishment assigns its rights to collect any receivables relating to the dishonored checks to Central. All amounts paid out by Central to the gaming establishment related to these items result in a warranty receivable in favor of Central from the patron. This amount is recorded in other receivables, net on the unaudited condensed consolidated balance sheets. On a monthly basis, Central evaluates the collectability of the outstanding balances and establishes a reserve for the face amount of the expected losses on these receivables. The warranty expense associated with this reserve is included within cost of revenues (exclusive of depreciation and amortization) in the unaudited condensed consolidated statements of income. Central’s policy is to write off all warranty receivables that are older than one year in age.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

A summary of the activity for the check warranty reserve for the three and nine months ended September 30, 2009, is as follows (amounts in thousands):

		Balance at				Additions								Balance at
		Beginning				Charged to								End of
		of Period				Expense				Deductions				Period
Three months ended September 30, 2009		$	11,113			$	1,873			$	(3,663	)		$	9,323
Nine months ended September 30, 2009		$	11,115			$	6,083			$	(7,875	)		$	9,323

Fair Value—The carrying amount approximates fair value for cash and cash equivalents, settlement and other trade receivables, settlement liabilities and trade payables.

Long-Term Debt—The fair value of the long-term debt was determined based on the borrowing rates currently available to the Company for debt with similar terms and average maturities.

The estimated fair value of the Company’s debt is (in thousands):

		As of September 30, 2009								As of December 31, 2008
		Carrying				Fair				Carrying				Fair
		Amount				Value				Amount				Value
Senior secured credit facility		$	97,250			$	97,250			$	98,000			$	113,000
Senior subordinated debt		$	152,750			$	153,132			$	152,750			$	120,863

The table below presents the activity in stockholders’ equity for the three and nine months ended September 30, 2009 (in thousands):

														Accumulated								Equity				Equity
						Additional								Other								Attributable				Attributable
		Common				Paid in				Retained				Comprehensive				Treasury				to GCA				to Minority				Total
		Stock				Capital				Earnings				Income				Stock				Holdings				Interest				Equity
Balance, 12/31/08		$	83			$	172,119			$	37,659			$	1,243			$	(50,226	)		$	160,878			$	—			$	160,878
Net income											26,381												26,381				(45	)			26,336
Foreign currency															796								796				—				796
Share-based compensation expense							6,203																6,203				—				6,203
Proceeds from exercise of options							2,621																2,621				—				2,621
Treasury shares, net																			(42,145	)			(42,145	)			(—	)			(42,145	)
Minority interest																							—				(25	)			(25	)
Other											4												4								4
Balance, 9/30/09		$	83			$	180,943			$	64,044			$	2,039			$	(92,371	)		$	154,738			$	(70	)		$	154,668

Arriva Discontinued Operations—Discontinued operations of our Arriva Card, a private-label revolving credit card aimed at consumers who perform cash advance transactions in gaming establishments, line of business that were reported in the prior three and nine months ended September 30, 2008 are no longer being reported as they are no longer significant. All references to Arriva discontinued operations have been eliminated from this Form 10-Q.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Recently Adopted Accounting Pronouncements—In December 2007, the FASB issued guidance for accounting and reporting of business combinations, in which an entity acquiring another business is required to recognize the assets acquired, liabilities assumed, contractual contingencies, and contingent consideration at their fair value on the date of the acquisition. It further requires that acquisition-related costs are recognized separately from the acquisition and expensed as incurred, restructuring costs generally are expensed in periods subsequent to the date of acquisition, and changes in accounting for deferred tax asset valuation allowances and acquired income tax uncertainties after the measurement period impact income tax expense. This guidance is effective for business combinations completed subsequent to January 1, 2009. The adoption of this guidance did not have a material impact on the consolidated financial statements of the Company.

In December 2007, the FASB issued guidance which establishes standards for the accounting and reporting of noncontrolling interests in subsidiaries (that is, minority interests) in consolidated financial statements and for the loss of control of subsidiaries. This guidance requires: (1) equity interest of noncontrolling shareholders, partners, or other equity holders in subsidiaries to be accounted for and presented in equity, separately from the parent shareholder’s equity, rather than as liabilities or as “mezzanine” items between liabilities and equity; (2) the amount of consolidated net income attributable to the parent and to the noncontrolling interests be clearly identified and presented on the face of the consolidated statement of income; and (3) when a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary be initially measured at fair value. The gain or loss on the deconsolidation of the subsidiary is measured using the fair value of any noncontrolling equity investment rather than the carrying amount of that retained investment. This guidance is effective beginning on January 1, 2009, and early adoption of the statement is prohibited. The adoption of this guidance did not have a material impact on the consolidated financial statements of the Company.

In April 2009, the FASB issued additional guidance on measuring the fair value of financial instruments when markets become inactive and quoted prices reflect distressed transactions. This guidance is effective for interim reporting periods ending after June 15, 2009. The adoption of this guidance did not have a material impact on the consolidated financial statements of the Company.

In May 2009, the FASB issued guidance which establishes standards for accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, including the period after the balance sheet date management should evaluate for recognition or disclosure in the financial statements, circumstances under which an entity would recognize events, and required disclosures. This guidance is effective for the interim period ended June 30, 2009. The adoption of this guidance did not have a material impact on the consolidated financial statements of the Company.

In July 2009, the FASB issued guidance which became the single source of authoritative U.S. GAAP. All other accounting literature not included in the Codification will be considered non-authoritative. This guidance is effective for interim and annual periods ending after September 15, 2009. This guidance impacts the current disclosure of our consolidated financial statements since all references will be topic references instead of to the FASB standard.

In August 2009, the FASB issued an update to the Fair Value Measurements and Disclosures of Liabilities Topic as reflected in the Codification. This update provides clarification on measuring liabilities at fair value when a quoted price in an active market is not available. This guidance is effective for the Company beginning October 1, 2009. The adoption of this guidance is not expected to have a significant impact on the consolidated financial statements of the Company.

3.

ATM FUNDING AGREEMENTS

Bank of America Amended Treasury Services Agreement—On March 13, 2008, the Company entered into an Amendment of the Treasury Services Agreement (“Bank of America ATM Funding Agreement”) with Bank of America, N.A. (“Bank of America”), which allows for the Company to utilize up to $410 million in funds owned by Bank of America to provide the currency needed for normal operating requirements for all the ATMs operated by the Company. The amount provided by Bank of America can be increased above $410 million at the option of Bank of America. For use of these funds, the Company pays Bank of America a cash usage fee equal to the average daily balance of funds utilized multiplied by the one-month LIBOR plus 25 basis points.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the three and nine months ended September 30, 2009 and 2008, $0.5 million and $1.7 million, $2.6 million and $4.0 million, respectively, of cash usage fees have been included in interest expense in the accompanying unaudited condensed consolidated statements of income.

The Company considered a number of factors in concluding the appropriate characterization of fees assessed the Company in connection with the utilization of cash under the Bank of America ATM Funding Agreement. The terms and conditions of this agreement clearly designate Bank of America as the owner of the cash used for ATM funding, thereby precluding the Company from recognizing either the cash obtained as an asset or the resulting obligation as a liability on the balance sheet. However, there are a number of characteristics of the Bank of America ATM Funding Agreement that led the Company to conclude the fees paid are similar to interest costs and therefore properly categorized as interest expense in the Company’s Statement of Operations as opposed to cost of revenue including the following:

	•		the Bank of America ATM Funding Agreement operates in a fashion similar to a revolving line of credit in that amounts are drawn and repaid on a daily basis,
	•		the resource being procured by the Company under the terms of the Bank of America ATM Funding Agreement is a financial resource and in the absence of such an arrangement, the Company would be required to obtain sufficient alternative financing either on balance sheet or off balance sheet in order to meet its financial obligations,
	•		the fees of the Bank of America ATM Funding Agreement are assessed on the outstanding balance during the applicable period and include a base rate which is tied to LIBOR and a spread, similar to a credit spread, of 25 basis points, and
	•		the fees incurred by the Company under the Bank of America ATM Funding Agreement are a function of both the prevailing rate of LIBOR as dictated by the capital markets and the average outstanding balance during the applicable period as previously noted. The fees do not vary with revenue or any other underlying driver of revenue such as transaction count or dollars processed as is the case with all costs classified as cost of revenue such as interchange expense, and processing fees.

At September 30, 2009 and December 31, 2008, the outstanding balance of cash used by the Company under the Bank of America ATM Funding Agreement was $347.3 million and $521.8 million, respectively, and the cash usage interest rate in effect was 0.5% and 1.4% respectively.

Site Funded ATMs—The Company operates some ATMs and redemption kiosks at customer locations where the customer provides the cash required for ATM operational needs. The Company is required to reimburse the customer for the amount of cash dispensed from these site-funded devices. The site-funded liability is included within settlement liabilities in the accompanying balance sheets and was $24.7 million and $50.6 million as of September 30, 2009 and December 31, 2008, respectively. As of September 30, 2009 and December 31, 2008, the Company operated 1,394 and 1,299 devices (ATMs and redemption kiosks), respectively, that were site funded.

4.

BENEFIT PLANS

Stock Options—The Company has issued stock options to directors, officers and key employees under the 2005 Stock Incentive Plan (the “2005 Plan”). Generally, options under the 2005 Plan (other than those granted to non-employee directors) will vest at a rate of 25% of the shares underlying the option after one year and the remaining shares vest in equal portions over the following 36 months, such that all shares are vested after four years. Stock options are issued at the current market price as of the closing of the market on the date of grant, with a contractual term of 10 years.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

A summary of award activity under the Company’s stock option plans as of September 30, 2009 and changes during the three and nine month periods then ended is as follows:

						Weighted
						Average				Weighted
						Exercise				Average Life				Aggregate
		Options				Prices				Remaining				Intrinsic Value
														(in thousands)
Outstanding — December 31, 2008			6,833,325			$	8.90			8.5 years				$	2,810
Granted			2,796,500				2.20
Exercised			—				—
Forfeited			(148,425	)			9.57
Outstanding — March 31, 2009			9,481,400			$	6.91			8.8 years				$	17,056
Granted			135,000				6.42
Exercised			(37,395	)			6.79
Forfeited			(128,753	)			4.60
Outstanding — June 30, 2009			9,450,252			$	6.87			8.5 years				$	16,811
Granted			50,000				6.89
Exercised			(343,210	)			6.82
Forfeited			(38,032	)			9.58
Outstanding — September 30, 2009			9,119,010			$	6.93			8.3 years				$	16,603
Exercisable — September 30, 2009			3,118,024				10.51			7.2 years				$	1,046

The fair value of options was determined as of the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions in the periods ended September 30, 2008 and 2009.

		2009				2008
Risk-free interest rate			2.0	%			2.9	%
Expected life of options (in years)			6.3				6.3
Expected volatility of GCA’s stock price			57.5	%			46.2	%
Expected dividend yield			0.0	%			0.0	%

There were stock options granted to acquire 50,000 and 3.0 million shares of common stock during the three and nine months ended September 30, 2009, respectively. During the three and nine months ended September 30, 2009, the Company received $2.5 million and $2.7 million, respectively, from the exercise of stock options. During the three and nine months ended September 30, 2009, the Company recorded $1.6 million and $4.5 million in non-cash compensation expense, respectively, related to options granted that are expected to vest. As of September 30, 2009, there was $13.8 million in unrecognized compensation expense related to options expected to vest. This cost is expected to be recognized on a straight-line basis over a weighted average period of 2.4 years.

There were stock options granted to acquire 0.2 million and 4.5 million shares of common stock during the three and nine months ended September 30, 2008, respectively. During the three and nine months ended September 30, 2008, we recorded $1.8 million and $5.2 million in non-cash compensation expense, respectively, related to options granted that are expected to vest.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Restricted Stock—The Company began granting restricted shares of common stock to officers and key employees in the first quarter of 2006. The vesting provisions are similar to those applicable to stock options. Because these restricted shares are issued primarily to employees of the Company, some of the shares issued will be withheld by the Company to satisfy the minimum statutory tax withholding requirements applicable to the restricted stock grants. Therefore, as these awards vest the actual number of shares outstanding as a result of the restricted stock awards is reduced and the number of shares included within treasury stock is increased by the amount of shares withheld. During the three and nine months ended September 30, 2009, the Company withheld 6,816 and 21,700 shares of restricted stock, respectively, from employees with a cumulative vesting commencement date fair value of $53,423 and $117,661, respectively. These amounts have been included as part of the total treasury stock repurchased during the period. Prior to vesting, the shares of restricted stock have rights to dividends declared, if any, and voting rights; therefore they are considered issued and outstanding.

A summary of all non-vested share awards for the Company’s time-based restricted shares as of September 30, 2009 is as follows:

						Weighted Average
		Shares				Grant Date Fair				Aggregate
		Outstanding				Value				Fair Value
Balance, December 31, 2008			190,251			$	15.67			$	2,981
Granted			1,047,875				2.20				2,305
Vested			(26,303	)			15.71				(413	)
Canceled			(3,456	)			16.60				(57	)
Balance — March 31, 2009			1,208,367			$	3.98			$	4,809
Granted			—				—				—
Vested			(24,833	)			6.12				(152	)
Canceled			(22,025	)			5.02				(111	)
Balance — June 30, 2009			1,161,509			$	3.91			$	4,547
Granted			—				—				—
Vested			(51,203	)			8.85				(453	)
Canceled			(1,376	)			6.08				(8	)
Balance — September 30, 2009			1,108,930			$	3.68			$	4,085

There were 51,203 and 102,339, respectively, time-based restricted shares vested during the three and nine months ended September 30, 2009. During the three and nine months ended September 30, 2009, we recorded $0.6 million and $1.7 million, respectively, in non-cash compensation expense related to the restricted stock granted expected to vest. As of September 30, 2009, there was $3.7 million in unrecognized compensation expense related to time-based restricted shares expected to vest. This cost is expected to be recognized on a straight-line basis over a weighted average period of 3.2 years.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

5.

COMMITMENTS AND CONTINGENCIES

Litigation Claims and Assessments

On April 11, 2008, a class action was filed by a stockholder in the United States District Court, Southern District of New York against the Company, certain of our former directors, our former chief executive officer, M&C International, Summit Partners, L.P., and certain underwriters of two prior stock offerings to the public. On June 10, 2008, an additional class action was filed, naming essentially the same defendants and stating similar claims. On June 26, 2008, the foregoing actions were consolidated in New York, and the Court appointed a lead plaintiff and lead counsel. In August 2008, the lead plaintiff filed a consolidated amended complaint. The consolidated amended complaint names as additional defendants our former chief financial officer, certain current and former directors and additional underwriters and defendants and purports to allege violations of Sections 11, 12(a)(2) and 15 the Securities Act of 1933, as amended (the “Securities Act”). The plaintiffs seek, among other things, damages and rescission. Following motions by defendants, the action was transferred to the District of Nevada in October 2008. The Company has indemnification agreements with each of the individual defendants and certain of the other defendants that may cause the Company to incur expenses associated with the defense of this action and that may also protect such defendants from liability to the Company. The Company also maintains director and officer liability insurance that may provide for reimbursement of some of the expenses associated with this action. At this stage of the litigation, the Company is unable to make an evaluation of whether the likelihood of an unfavorable outcome is either probable or remote or the amount or range of potential loss; however the Company believes it has meritorious defenses and will vigorously defend this action.

On June 4, 2009, the Company received a Notice of Intent to Deny State Certification (the “Notice”) from the Arizona Department of Gaming (the “Department”). The Notice summarizes the basis for the Department’s intention and alleges that the Company, its founding stockholders and certain of the Company’s management undertook actions that demonstrate that the Company is not suitable under the Department’s standards to act as a provider of gaming services to Native American tribes conducting gaming in Arizona. On November 3, 2009, the Company and the Department entered into an agreement in principle under which the Department and the Company agreed to settle and compromise all claims described in the Notice. Under such agreement in principle, the Department has concluded that the current officers and directors of the Company are suitable for certification and the Department has agreed to issue a renewal of state certification to the Company subject to the completion and execution of a definitive settlement agreement between the Company and the Department. The Company’s cash advance and ATM revenue generated in the State of Arizona represents approximately 4.2 percent of the Company’s total revenue for the nine month period ended September 30, 2009.

On July 8, 2009, a class action was commenced by a patron of one of our gaming establishment customers in the United States District Court, Western District of Pennsylvania, against the Company. The complaint alleges violations of the Electronics Fund Transfer Act as the result of the alleged failure of the Company to provide notice in the statutorily required manner of transaction fees charged at certain of its ATM machines. The named plaintiff sought, among other things, actual or statutory damages. On September 24, 2009, the named plaintiff and the Company entered into an executed settlement communication pursuant to which the parties agreed to establish a nationwide class of plaintiffs and, the Company agreed to establish a common fund, from which all costs, expenses and legal fees of the participating class members would be paid and the balance would be subsequently disbursed to the participating class members, following which the class action shall be dismissed with prejudice. The class action will be dismissed without admission of liability being made by the Company. The Company maintains insurance that may provide for reimbursement of some of the expenses associated with this action.

We are threatened with or named as a defendant in various lawsuits arising in the ordinary course of business, such as personal injury claims and employment-related claims as well as being threatened or named as a defendant in lawsuits arising in the ordinary course of business and assumed as a result of the acquisition of Certegy Gaming Services, Inc. (“CGS”), for which we have limited indemnification rights until April 2010, and as a result of the acquisition of Cash Systems, Inc. (“CSI”). It is not possible to determine the ultimate disposition of these matters; however, we are of the opinion that the final resolution of any such threatened or pending litigation, individually or in the aggregate, is not likely to have a material adverse effect on our business, cash flows, results of operations or financial position.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Commitments

Innovative Funds Transfer, LLC (“IFT”) Required Capital Investment. Pursuant to the terms of our agreement with International Gaming Technology, we are obligated to invest up to our pro rata share of $10.0 million in capital to IFT. Our obligation to invest additional capital in IFT is conditioned upon capital calls, which are in our sole discretion. As of September 30, 2009, we had invested a total of $4.6 million in IFT, and are committed to invest up to $1.4 million in additional capital investments if required.

First Data Sponsorship Indemnification Agreement. On March 10, 2004, the Company and First Data entered into a Sponsorship Indemnification Agreement whereby First Data agreed to continue its guarantee of performance by us to Bank of America for our sponsorship as a Bank Identification Number and Interbank Card Association licensee under the applicable VISA U.S.A. and MasterCard International rules. The Company has agreed to indemnify First Data and its affiliates against any and all losses and expenses arising from its indemnification obligations pursuant to that agreement. As collateral security for prompt and complete performance of the Company’s obligations under this agreement, the Company was required to cause a letter of credit in the amount of $3.0 million to be issued to First Data to cover any indemnified amounts not paid under terms of this agreement. The required amount of this letter of credit will be adjusted annually based upon the underlying cash advance volume covered by the Sponsorship Indemnification Agreement. In March 2009, the $3.4 million letter of credit expired. In April 2009, the letter of credit was reissued for $3.8 million. As of September 30, 2009, the outstanding balance for this letter of credit remains at $3.8 million.

6.

BORROWINGS

Second Amended and Restated Credit Agreement. On November 1, 2006, GCA and Holdings entered into a Second Amended and Restated Credit Agreement with certain lenders. The Second Amended and Restated Credit Agreement amended and restated the terms of GCA’s then existing senior secured credit facilities to provide for a $100.0 million term loan facility (“Term Loan Facility”) and a $100.0 million five-year revolving credit facility (“Revolving Line”), with a $25.0 million letter of credit sublimit and a $5.0 million swingline loan sublimit. The Term Loan Facility and the Revolving Line will mature in November 2011.

The Second Amended and Restated Credit Agreement contains customary affirmative and negative covenants, financial covenants, representations and warranties and events of default, which are subject to important exceptions and qualifications, as set forth in the Second Amended and Restated Credit Agreement. As of September 30, 2009, the Company is in compliance with the required covenants.

Senior Subordinated Notes. On March 10, 2004, GCA completed a private placement offering of $235.0 million 8.75% Senior Subordinated Notes due March 15, 2012 (the “Notes Offering”). On October 14, 2004, GCA completed an exchange offer of the notes for registered notes of like tenor and effect. Interest on the notes accrues based upon a 360-day year comprised of twelve 30-day months and is payable semiannually on March 15th and September 15th. The notes are subordinated to GCA’s obligations under the Second Amended and Restated Credit Agreement. All of GCA’s existing and future domestic wholly owned subsidiaries are guarantors of the notes on a senior subordinated basis. As of September 30, 2009 and December 31, 2008, the Company had $152.8 million in principal amount of borrowings outstanding under the Notes Offering.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

A summary of the borrowings, repayments and amortization of the Term Loan Facility, the Revolving Line and senior subordinated debt described below is as follows (in thousands):

		Term Loan				Revolving				Senior
		Facility				Line				Sub-Debt
Balance, December 31, 2008		$	98,000			$	15,000			$	152,750
borrowings			—				—				—
repayments			(250	)			(15,000	)			—
Balance, March 31, 2009			97,750				—				152,750
borrowings			—				—				—
repayments			(250	)			—				—
Balance, June 30, 2009		$	97,500			$	—			$	152,750
borrowings			—				—				—
repayments			(250	)			—				—
Balance, September 30, 2009		$	97,250			$	—			$	152,750

As of September 30, 2009, the weighted average interest rate under the Term Loan Facility, inclusive of the applicable margin of 0.875 basis points, was 1.121%.

7.

CAPITAL STOCK

Common Stock Repurchase Program—On February 6, 2007, the Company’s Board of Directors authorized the repurchase of up to $50.0 million of the Company’s issued and outstanding common stock, subject to compliance with any contractual limitations on such repurchases under the Company’s financing agreements in effect from time to time, including but not limited to those relating to the Company’s senior secured indebtedness and senior subordinated debt. The Company completed the repurchases under this authorization on February 11, 2008.

On April 30, 2009, the Company’s Board of Directors authorized the repurchase of an additional $25.0 million of the Company’s issued and outstanding common stock, subject to compliance with any contractual limitations on such repurchases under the Company’s financing agreements in effect from time to time, including but not limited to those relating to the Company’s senior secured indebtedness and senior subordinated debt.

On June 24, 2009, the Company repurchased 5,785,602 shares of its common stock from one of its founders, Robert Cucinotta, at a per share price of $6.25 and an aggregate price of $36.2 million. The repurchase was made pursuant to the provisions of the Company’s certificate of incorporation that provide the Company with the right to redeem shares of its common stock that are owned by stockholders that are found to be unsuitable stockholders for gaming regulatory purposes. The repurchase was a private transaction and was funded with existing cash resources. The repurchase was separately approved by the Board of Directors subsequent to the previously-announced authorization to repurchase up to $25 million of common stock.

On June 30, 2009, the Company issued written notice to one of its founders, Karim Maskatiya, of the Company’s intent to redeem 6,652,475 shares of its common stock from Mr. Maskatiya pursuant to the provisions of the Company’s certificate of incorporation that provide the Company with the right to redeem shares of its common stock that are owned by stockholders that are found to be unsuitable stockholders for gaming regulatory purposes.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The redemption would have been completed on or about September 22, 2009 at a price per share equal to the average closing price of the Company’s stock on the New York Stock Exchange during the thirty trading days prior to the date of notice to Mr. Maskatiya, which was approximately $6.98; however, the Company believes that subsequent to June 30, 2009, Mr. Maskatiya disposed of all of the shares in open market transactions.

During the three and nine months ended September 30, 2009, the Company repurchased 814,300 and 6,614,786 shares of stock, respectively, at an aggregate purchase price of $5,921,549 and $42,145,800, respectively. Of the shares repurchased during the three and nine months ended September 30, 2009, 6,816 and 21,700 were withheld from restricted stock awards, respectively, to satisfy the minimum applicable tax withholding obligations incident to the vesting of such restricted stock awards.

8.

RELATED PARTY TRANSACTIONS

At March 31, 2009, two former Board of Directors members, Karim Maskatiya and Robert Cucinotta, were the owners of approximately 19,596,350 shares of common stock, which represented at that time, 25.5% of the outstanding equity interests of the Company. On June 24, 2009, the Company repurchased 5,785,602 shares from Mr. Cucinotta, which we believe to be all of the shares previously held by Mr. Cucinotta. Mr. Maskatiya disposed of a number of shares in open market transactions that we believe to be all of the shares previously held by Mr. Maskatiya. During the three and nine months ended September 30, 2009, the Company made payments for software development costs and system maintenance to Infonox on the Web (“Infonox”) pursuant to agreements with Infonox. At the time we entered into these agreements, Infonox was controlled by Messrs. Maskatiya and Cucinotta. In November 2008, Infonox was wholly acquired by Total System Services, Inc. (“TSYS”) and neither Messrs. Maskatiya and Cucinotta nor any of the family members retained any interest in, or management responsibilities for, Infonox. On January 5, 2009, the Company commenced an action in the State of Nevada District Court, Clark County, against USA Payment and USA Payment Systems (together “USAP”), companies owned or controlled by Messrs. Maskatiya and Cucinotta in connection with various disputes relating to the Amended and Restated Agreement for Electronic Payment Processing, pursuant to which USAP provided the Company with transaction processing services. On September 30, 2009, the Company and USAP entered into an executed settlement agreement, pursuant to which USAP agreed to pay the Company $1.75 million, and the parties agreed to the settlement of all claims and matters between the parties. The action has been dismissed with prejudice.

The following table represents the transactions with related parties for the three and nine months ended September 30, 2009 and 2008 (amounts in thousands):

				Three Months Ended								Nine Months Ended
Name of				September 30,								September 30,
Related Party		Description of Transaction		2009				2008				2009				2008
USA Payments and USA Payment Systems		Transaction processing charges included in cost of revenues (exclusive of depreciation and amortization)		$	703			$	861			$	4,009			$	2,786
		Pass through billing related to gateway fees, telecom and other items included in cost of revenues (exclusive of depreciation and amortization) and operating expenses			326				314				853				908
Infonox on the Web(1)		Software development costs and maintenance expense included in operating expenses and other intangibles, net			—				1,211				—				2,652

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table details the amounts receivable from or (liabilities to) these related parties that are recorded as part of other receivables, net, accounts payable or accrued expenses in the unaudited condensed consolidated balance sheets (amounts in thousands):

		September 30,				December 31,
Name of Related Party		2009				2008
USA Payment Systems		$	(227	)		$	(212	)
Infonox on the Web			—				(447	)
Total included within accounts payable and accrued expenses		$	(227	)		$	(659	)

9.

INCOME TAXES

Our effective income tax rate for continuing operations was 38.0% for both the three and nine months ended September 30, 2009, compared to 39.1% and 41.1% for the three and nine months ended September 30, 2008, respectively. Due to the amortization of our deferred tax assets for income tax purposes, actual cash taxes paid on pretax income generated in the third quarter of 2009 are expected to be substantially lower than the provision.

The following table presents the recorded income tax expense for the three and nine months ended September 30 (amounts are in thousands):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2009				2008				2009				2008
Provision for income taxes:
Provision for income taxes on continuing operartions, as reported		$	4,966			$	5,385			$	16,114			$	15,976
Provision (benefit) for income taxes, discontinued operations			—				88				25				(2,254	)
Provision for income taxes, consolidated			4,966				5,473				16,139				13,722
Provision for income taxes, minority loss			7				—				25				49
Provision for income taxes attributable to GCA Holdings, Inc.		$	4,973			$	5,473			$	16,164			$	13,771

As of September 30, 2009, we had a net deferred income tax asset of $156.0 million. We recognized a deferred tax asset upon our conversion from a limited liability company to a corporation on May 14, 2004. Prior to that time, all tax attributes flowed through to the members of the limited liability company. The principal component of the deferred tax asset is a difference between our assets for financial accounting and tax purposes. This difference results from a significant balance of Acquired Goodwill of approximately $687 million that was generated as part of the conversion to a corporation plus approximately $98 million in pre-existing goodwill, subject to certain limitations, carried over from periods prior to the conversion. Both of these assets are recorded for tax purposes but not for accounting purposes. This asset is amortized over 15 years for tax purposes, resulting in annual pretax income being $52.3 million lower for tax purposes than for financial accounting purposes. At an estimated blended domestic effective tax rate of 36.0%, this results in tax payments being approximately $18.8 million less than the provision for income taxes shown on the income statement for financial accounting purposes. This is an expected aggregate of $180.6 million in cash savings over the remaining life of the portion of our deferred tax asset related to the conversion. These deferred tax assets may be subject to certain limitations.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

10.

SEGMENT INFORMATION

Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision-making group consists of the Chief Executive Officer and Chief Financial Officer. The operating segments are reviewed separately because each represents products or services that can be, and often are, marketed and sold separately to our customers.

The Company operates in three distinct business segments: (1) cash advance, (2) ATM and (3) check services. These segments are monitored separately by management for performance against its internal forecast and are consistent with the Company’s internal management reporting.

Other lines of business, none of which exceed the established materiality for segment reporting, include money transfers, credit reporting, direct marketing and IFT, among others.

The Company’s business is predominantly domestic, with no specific regional concentrations.

Major customers—For the three and nine months ended September 30, 2009, the combined revenues from all segments from our largest customer, Harrah’s Operating Company, Inc. and its subsidiaries and affiliates was approximately $23.3 million and $72.4 million, respectively, representing 14.3% and 14.0% of the Company’s total consolidated revenues, respectively. For the three and nine months ended September 30, 2008, the combined revenues from all segments from our largest customer, Harrah’s Operating Company, Inc. and its subsidiaries and affiliates was approximately $28.0 million and $83.3 million, respectively representing 15.1% and 16.7% of the Company’s total consolidated revenues, respectively.

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies. The tables below present the results of operations by operating segment for the three and nine months ended September 30, 2009 and 2008 and total assets by operating segment as of September 30, 2009 and December 31, 2008 (amounts in thousands):

		Cash								Check
		Advance				ATM				Services				Other				Corporate				Total
Three Months Ended September 30, 2009
Revenues		$	69,741			$	81,544			$	9,464			$	3,570			$	—			$	164,319
Operating income exclusive of depreciation and amortization (1)			15,253				10,747				5,491				2,973				(16,995	)			17,469
Three Months Ended September 30, 2008
Revenues		$	89,102			$	79,863			$	12,962			$	3,132			$	—			$	185,059
Operating income exclusive of depreciation and amortization (1)			19,104				12,275				7,135				2,431				(19,629	)			21,316
Nine Months Ended September 30, 2009
Revenues		$	225,899			$	252,585			$	30,791			$	9,689			$	—			$	518,964
Operating income exclusive of depreciation and amortization (1)			50,242				33,256				17,408				7,894				(52,770	)			56,030
Nine Months Ended September 30, 2008
Revenues		$	244,320			$	210,670			$	31,479			$	8,883			$	—			$	495,352
Operating income exclusive of depreciation and amortization (1)			56,485				33,111				15,668				6,573				(51,640	)			60,197

		September 30,				December 31,
Total Assets		2009				2008
Cash advance		$	114,709			$	172,882
ATM			89,716				111,781
Check services			41,822				39,412
Other			32,383				22,732
Discontinued Operations			—				1,560
Corporate			209,114				210,783
Total assets		$	487,744			$	559,150

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

11.

SUBSEQUENT EVENTS

On November 3, 2009, the Company and the Arizona Department of Gaming (the “Department”) entered into an agreement in principle under which the Department and the Company agreed to settle and compromise all claims described in the Notice. Under such agreement in principle, the Department has concluded that the current officers and directors of the Company are suitable for certification and the Department has agreed to issue a renewal of state certification to the Company subject to the completion and execution of a definitive settlement agreement between the Company and the Department.

Other than as noted above, no events have occurred subsequent to September 30, 2009 that require consideration or disclosure in the condensed consolidated financial statements as of or for the period ended September 30, 2009. Management has completed its review of subsequent events through November 6, 2009, the date these financial statements became available for issuance.

12.

GUARANTOR INFORMATION

In March 2004, GCA issued $235 million in aggregate principal amount of 8³/4% senior subordinated notes due 2012 (the “Notes”). As of September 30, 2009 and December 31, 2008 there was $152.8 million in Notes outstanding. The Notes are guaranteed by all of GCA’s existing and future domestic 100% owned subsidiaries. In addition, effective upon the closing of the Company’s initial public offering of common stock, Holdings guaranteed, on a subordinated basis, GCA’s obligations under the Notes. These guarantees are full, unconditional, joint and several. GCA’s international subsidiaries and IFT, which is a consolidated joint venture, do not guaranty the Notes. The following consolidating schedules present separate unaudited condensed financial statement information on a combined basis for Holdings, referred to as the parent only, GCA, referred to as the issuer, as well as GCA’s guarantor subsidiaries and non-guarantor subsidiaries and affiliate, as of September 30, 2009 and December 31, 2008, and for the three and nine months ended September 30, 2009 and 2008:

GLOBAL CASH ACCESS HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING SCHEDULE — BALANCE SHEET INFORMATION
SEPTEMBER 30, 2009
(amounts in thousands)
(unaudited)

										Combined				Combined Non-				Elimination
		Parent				Issuer				Guarantors				Guarantors				Entries *				Consolidated
ASSETS
Cash and cash equivalents		$	—			$	63,561			$	444			$	9,707			$	—			$	73,712
Restricted cash and cash equivalents			—				369				—				—				—				369
Settlement receivables			—				3,264				—				1,604				(627	)			4,241
Other receivables, net			1,269				9,960				87,661				969				(82,238	)			17,621
Prepaid and other assets			—				10,186				761				198				—				11,145
Investment in subsidiaries			154,668				94,422				—				—				(249,090	)			—
Property, equipment and leasehold improvements, net			—				19,512				531				536				—				20,579
Goodwill, net			—				128,064				45,501				763				—				174,328
Other intangibles, net			—				29,132				71				554				—				29,757
Deferred income taxes, net			—				144,337				11,618				37				—				155,992
TOTAL		$	155,937			$	502,807			$	146,587			$	14,368			$	(331,955	)		$	487,744
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Settlement liabilities		$	—			$	34,431			$	4			$	2,734			$	(627	)		$	36,542
Accounts payable			—				31,580				205				162				—				31,947
Accrued expenses			1,269				43,953				47,038				4,565				(82,238	)			14,587
Borrowings			—				250,000				—				—				—				250,000
Total liabilities			1,269				359,964				47,247				7,461				(82,865	)			333,076
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY
Total stockholders’ equity attributable to GCA, Inc.			154,738				142,913				99,340				6,907				(249,160	)			154,738
MINORITY INTEREST			(70	)			(70	)			—				—				70				(70	)
Total stockholders’ equity			154,668				142,843				99,340				6,907				(249,090	)			154,668
TOTAL		$	155,937			$	502,807			$	146,587			$	14,368			$	(331,955	)		$	487,744