EXHIBIT 8
FIRST AMENDMENT TO RIGHTS AGREEMENT
This agreement is entered into as of the 6th day of November, 1997
between Midway Games Inc., a Delaware corporation ("Midway"), and The Bank of
New York, a New York banking corporation (the "Rights Agent").
WHEREAS, WMS Industries Inc. ("WMS") has announced a proposed
distribution of all of the shares of Midway common stock, par value $.01 per
share, owned by WMS to the stockholders of WMS (the "Distribution"); and
WHEREAS, Midway and the Rights Agent are parties to a Rights Agreement
dated as of October 24, 1996 (the "Rights Agreement").
NOW THEREFORE, in consideration of the foregoing, subject to and
effective upon the completion by WMS of the Distribution, the parties hereby
agree as follows:
1. Capitalized terms as used herein and not otherwise defined shall have
the same meaning ascribed to such terms in the Rights Agreement.
2. Section 1(a) of the Rights Agreement shall be amended and restated to
read as follows:
(a) "Acquiring Person" shall mean any Person who or which,
together with all Affiliates and Associates of such Person, shall be
the Beneficial Owner of 15% or more of shares of Common Stock then
outstanding, but shall not include an Exempt Person.
3. Section 1(h) of the Rights Agreement shall be amended and restated to
read as follows:
(h) "Exempt Person" shall mean (i) the Company, any Subsidiary
of the Company, WMS Industries Inc. and any of its Affiliates and
Associates ("WMS"), any employee benefit plan of the Company or of any
Subsidiary of the Company, or any Person or entity organized, appointed
or established by the Company for or pursuant to the terms of any such
plan; or (ii) any Person who is the Beneficial Owner of 15% or more of
the outstanding shares of Common Stock at the close of business on the
date of the completion of the distribution of all of the shares of
Midway common stock, par value $.01 per share, owned by WMS Industries
Inc. to the stockholders of WMS Industries Inc.; or (iii) any Person
who inadvertently acquired Beneficial Ownership of 15% or more of the
outstanding shares of Common Stock or otherwise acquired Beneficial
Ownership of shares of Common Stock without any plan or intention to
seek control of the Company and without knowledge that such acquisition
would make such Person an Acquiring Person, if, in either case, such
Person promptly divests (without exercising or retaining any power,
including voting, with respect to such shares) a sufficient number of
shares of Common Stock (or securities convertible into Common Stock) so
that such Person ceases to be the Beneficial Owner of a number of
shares of Common Stock that would otherwise cause such Person to be an
Acquiring Person, after notice by the Company (or, after the first
Stock Acquisition Date, after notice by a majority of the Continuing
Directors) that such Person will be
deemed by the Company to be an Acquiring Person unless it makes such
divestitures; or (iv) any Person whose Beneficial Ownership of 15% or
more of the outstanding shares of Common Stock is approved in advance
(but only to the extent of Beneficial Ownership which is so approved)
by the Board of Directors of the Company or, after the first Stock
Acquisition Date, by a majority of the Continuing Directors;
4. Section 3(a) of the Rights Agreement shall be amended and restated to
read as follows:
(a) Until the earlier of (i) the Close of Business on the
tenth day after the Stock Acquisition Date or (ii) the Close of
Business on the tenth Business Day (or such later day as may be
determined by action of the Board of Directors (but only if at the time
of such determination there are then in office not less than two
Continuing Directors and such action is approved by a majority of the
Continuing Directors) prior to such time as any Person becomes an
Acquiring Person) after the date of commencement by any Person (other
than an Exempt Person) of, or of the first public announcement of the
intention of any Person (other than an Exempt Person) to commence, a
tender or exchange offer, if upon consummation thereof, such Person
would be the Beneficial Owner of 15% or more of the Common Stock then
outstanding (the earlier of (i) and (ii) being herein referred to as
the "Rights Distribution Date"), the Rights will be evidenced (subject
to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the
holders thereof (which certificates for Common Stock shall be deemed
also to be certificates for Rights) and not by separate certificates,
and will be transferable only in connection with the transfer of the
underlying shares of Common Stock. As soon as practicable after the
Rights Distribution Date, the Rights Agent will send by first-class,
insured, postage prepaid mail, to each record holder of the Common
Stock as of the close of business on the Rights Distribution Date, at
the address of such holder shown on the records of the Company, one or
more Rights certificates, in substantially the form of Exhibit B hereto
(the "Rights Certificates"), evidencing one Right for each share of
Common Stock so held, subject to adjustment in the number of Rights per
share of Common Stock as has been made pursuant to Section 11(p)
hereof, at the time of distribution of the Rights Certificates, the
Company shall make the necessary and appropriate rounding adjustments
(in accordance with Section 14(a) hereof) so that Rights Certificates
representing only whole numbers of rights are distributed and cash is
paid in lieu of any fractional Rights. As of and after the Rights
Distribution Date, the Rights will be evidenced solely by such Rights
Certificates.
5. Section 13(d) of the Rights Agreement shall be amended and restated to
read as follows:
(d) Notwithstanding anything in this Agreement to the
contrary, Section 13 shall not be applicable to a transaction described
in subparagraphs (x), (y) or (z) of Section 13(a) if such transaction
is (i) approved (whether or not the approval of the Board of Directors
is required in connection with such transaction) by a majority of the
Board of Directors of the Company (or, from and after the Stock
Acquisition Date, a majority of Continuing Directors), or (ii) a merger
which follows a cash tender offer approved by the Board of Directors
(or, from and after the Stock Acquisition Date, a majority of
Continuing Directors) for all outstanding shares of Common Stock so
long as the consideration payable in the merger is the same in form and
not less than the amount as was paid in the tender offer, and (x) at
the time the Board of Directors approves such transaction, the Board of
Directors is aware of the identity of any Person (and the identities of
all the Person's Affiliates and Associates) whose beneficial ownership
will equal or exceed 15% of the shares of Common Stock of the Company
both before and after such transaction and (y) the number of shares of
Common Stock beneficially owned by any such Person, together with such
Person's Affiliates and Associates both before and after such
transaction.
6. Section 18 of the Rights Agreement shall be amended and restated to
read as follows:
(a) The Company agrees to pay to the Rights Agent such
compensation as shall be agreed to from time to time between the
parties for all services rendered by it hereunder and, from time to
time, on
demand of the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the administration and execution
of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for,
and to hold it harmless against, any and all loss, liability, damage,
claim or expense, incurred without gross negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done
or omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including, without limitation, the
costs and expenses of defending against any claim of liability in the
premises.
(b) The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by
it in connection with its administration of this Agreement in reliance
upon any Rights Certificate or certificate for Common Stock or for
other securities of the Company, instrument of assignment or transfer,
power of attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement, or other paper or document believed by
it to be genuine and to be signed and executed by the proper Person or
Persons and, where necessary, to be verified or acknowledged.
The provisions of this Section 18 shall survive the expiration of the
Rights and the termination of this Agreement.
7. Except as specifically amended above, the Rights Agreement shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested, all as of the day and year first above written.
Attest: MIDWAY GAMES INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxx, Xx.
--------------------------------- ----------------------------------
Name: Xxxxx X. Xxxxxx Name: Xxxxxx X. Xxxx, Xx.
Title: Vice President Title: Executive Vice President -- Finance
Attest: THE BANK OF NEW YORK, as Rights Agent
By: /s/ Xxxxxx Xxxx By: /s/ Xxxxxxx Xxxxxx
--------------------------------- ----------------------------------
Name: Xxxxxx Xxxx Name: Xxxxxxx Xxxxxx
Title: Assistant Vice President Title: Assistant Vice President
