Exhibit 99.1
VOTING PROXY AGREEMENT
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THIS VOTING PROXY AGREEMENT (hereinafter this "Agreement"), made and
entered as of this 25th day of August, 1995, by and among WMS Industries Inc., a
Delaware corporation, (hereinafter the "Company"), Xxxxxx X. Xxxxxxxx
(hereinafter "Redstone"), National Amusements, Inc. (hereinafter "NAI," and
collectively with Redstone the "Shareholders"), and Xxxxx X. Xxxxxxxx and Xxxx
X. Xxxxxxxx, individuals, as Proxy Holder.
W I T N E S S E T H:
WHEREAS, the Company is a publicly traded corporation with common stock,
par value $0.50 per share, traded on the New York Stock Exchange; and,
WHEREAS, as of the date of this Agreement each of the Shareholders owns,
either beneficially or of record, the number of shares of the Company's common
stock, par value $0.50 per share, as set forth opposite such Shareholder's name
on Exhibit A hereto; and,
WHEREAS, the Shareholders are passive investors in the Company, have no
representation on the Board of Directors of the Company and have no involvement
in the management of the Company; and,
WHEREAS, on August 24, 1995, the Nevada Gaming Commission granted the
applications of the Company and its subsidiaries, WMS Games Inc., WMS Gaming
Inc., WMS Gaming (Nevada) Inc., and the Proxy Holder for findings of suitability
as a registered publicly traded corporation, as registered holding companies,
licensure as a manufacturer and distributor of gaming devices, and for licensure
or findings of suitability as directors and officers respectively; and,
WHEREAS, Redstone has an application pending with the Nevada State Gaming
Control Board and Nevada Gaming Commission for a finding of suitability as a
Shareholder of the Company; and,
WHEREAS, the Shareholders have voluntarily decided to grant to the Proxy
Holder a voting proxy for all of the shares of common stock of the Company that
the Shareholders own beneficially or of record at the time of the licensure,
finding of suitability and other approval of the Company and its subsidiaries,
officers and directors by the Nevada Gaming Commission; and,
WHEREAS, in order to assure that the passive investment position of the
Shareholders relative to the Company will not change without prior notification
of the Nevada Gaming Authorities (herein defined), the Shareholders are amenable
to entering this Agreement; and,
WHEREAS, the Company, Shareholders and Redstone have the ability to perform
under this Agreement; and,
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, it is agreed as follows:
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ARTICLE 1
Definitions and Interpretation
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Unless otherwise stated in this Agreement:
"Affiliate" shall have the meaning ascribed to that term by Section
15.482-3 of the Regulations of the Nevada Gaming Commission.
"Common Stock" means all voting equity securities of the Company
beneficially owned by Redstone individually or through his ownership and control
of NAI or any other Person.
"Nevada Gaming Authorities" means the Nevada State Gaming Control Board and
the Nevada Gaming Commission.
"Nevada Board Chairman" means the chairman of the Nevada State Gaming
Control Board or his designee.
"Person" means a natural person, any form of business or social
organization and any other nongovernmental legal entity.
"Proxy Holder" means Xxxxx X. Xxxxxxxx, Chairman of the Board of Directors
of the Company, or in the event Xxxxx X. Xxxxxxxx is unable to perform the
duties and exercise the rights of Proxy Holder, Xxxx X. Xxxxxxxx, President of
the Company.
"Shareholder" means Xxxxxx X. Xxxxxxxx and National Amusements, Inc.
ARTICLE 2
Creation and Termination of Voting Proxy
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2.1 This Agreement shall not be effective until that day which is ten (10)
business days after the date of the Company's registration with the Nevada
Gaming Authorities as a publicly traded corporation. The Proxy Holder shall file
a copy of this Agreement in the registered office of the Company in Delaware.
2.2 Each Shareholder shall perform such further acts and execute such
further documents and instruments as may reasonably be required to confer on the
Proxy Holder the power to carry out the provisions of this Agreement, including
the execution of new or additional proxies.
2.3 The Shareholders shall be entitled to terminate this Agreement
effective thirty (30) calendar days following service of written notice of such
termination on the Company, Proxy Holder and the Nevada Board Chairman.
2.4 Except if, and to the extent, terminated pursuant to paragraph 2.3,
this Agreement shall remain effective as to any Common Stock of the Company
owned beneficially or of record by the Shareholders, other than the Common Stock
of the Company previously in such ownership of the Shareholders that is sold or
otherwise disposed of in a transfer to a Person that is not an Affiliate of the
Shareholders, unless and until:
2.4.1 The Shareholders shall be found suitable as a shareholder of the
Company by the Nevada Gaming Authorities pursuant to Nevada Revised Statute
463.643(3); or,
2.4.2 The Shareholders shall not be subject to the provisions of
Nevada Revised Statute 463.643(3).
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2.5 Failure by the Company to comply with the notice requirement described
in paragraph 4.1 hereof shall be deemed an automatic termination of this
Agreement as to any subject matter for which such notice was not properly given
by the Company.
2.6 Unless sooner terminated as provided in paragraphs 2.3 through 2.5
hereof, this Agreement shall continue in force until ten (10) years from the
date hereof (hereinafter the "Voting Proxy Term"). Two years before the
expiration of ten (10) years from the date hereof, the parties may agree to
extend this Agreement for another ten (10) years.
ARTICLE 3
Powers, Rights and Duties of Proxy Holder
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3.1 Each Shareholder, by this Agreement, with respect to the Common Stock
that such Shareholder owns beneficially or of record, does hereby constitute and
appoint the Proxy Holder, with full power of substitution, during and for the
Voting Proxy Term, as their true and lawful attorney-in-fact and proxy, for and
in their name, place and xxxxx, to vote all shares of the Common Stock as the
proxy of the Shareholders, at every annual, special or adjourned meeting of the
Shareholders of the Company, including the right to sign the Proxy Holder's name
as Shareholder to any consent, certificate or other document relating to the
Company that the law of the State of Delaware may permit or require on any and
all matters which may be presented to the Shareholders of the Company. Actions
to be taken by Proxy Holder shall be determined by Proxy Holder in his sole and
absolute discretion. Without limiting the foregoing, Proxy Holder may exercise
all of the voting rights of the Shareholders, including for example, the right
to vote or consent to amendment of the Articles of Incorporation of Company,
sale of all corporate assets, mergers, consolidations, reductions of capital and
dissolutions, except that Proxy Holder shall not sell, assign or otherwise
dispose of the Common Stock. This Agreement shall continue and be applicable
with respect to any securities of the Company having any voting rights issued by
the Company to the Shareholders in substitution or exchange for, or as a
distribution on, the Common Stock of Company.
3.2 Proxy Holder shall serve without compensation as Proxy Holder and will
be responsible for the payment of all expenses and charges and to employ and pay
such agents and attorneys as Proxy Holder may deem necessary and proper in the
performance of his duties under this Agreement.
3.3 In voting the Common Stock, Proxy Holder shall use his best judgment
from time to time to the end that the affairs of the Company shall be properly
managed. Proxy Holder may cause himself to be elected as director of the Company
and Proxy Holder may act as an employee, officer or agent of company and be
reasonably compensated for his services in such capacity as fully as though he
were not a Proxy Holder.
3.4 Proxy Holder shall not be liable to the Company or the Shareholders for
any act or omission of the Proxy Holder, or any agent of the Proxy Holder, or be
held to any personal liability whatsoever in tort, contract, or otherwise in
connection with the performance of the Proxy Holder's obligations pursuant to
this Agreement, except for liabilities arising from the Proxy Holder's bad
faith, willful misfeasance or reckless disregard of duty. The Proxy Holder shall
not be liable except for the performance of any duties and obligations as are
specifically set forth in this Agreement and no implied covenants or obligations
shall be read into the Agreement against the Proxy Holder. The Proxy Holder
shall not be liable with respect to any action taken or omitted to be taken by
the Proxy Holder in good faith. In addition to, and not in limitation of, the
foregoing, no successor Proxy Holder shall in any way be liable for the acts or
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omissions of any Proxy Holder or agent of the Proxy Holder occurring prior to
the date on which he became a Proxy Holder.
3.5 Proxy Holder may consult with counsel, auditors or other experts, and
the advice or opinion of such counsel, auditors, or other experts shall be full
and complete personal protection to the Proxy Holder in respect of any action
taken or suffered by the Proxy Holder in good faith and in reliance upon or in
accordance with such advice or opinion. In discharging his duties, the Proxy
Holder may rely upon financial statements of the Company represented to the
Proxy Holder to be correct by the Person having charge of the Company's books of
account, or stated in a written report by an independent certified public
accountant to present fairly the financial position of the Company. The Proxy
Holder may rely, and shall be personally protected in acting upon any
instrument, certificate, opinion, report, notice, order or other document of any
sort whatsoever delivered to him in connection with this Agreement reasonably
believed by him to be genuine.
3.6 The Shareholders, the Proxy Holder and the Company, indemnify and hold
harmless the members, employees, and agents of the Nevada Gaming Authorities
from any and all losses, liabilities, claims, demands, damages, deficiencies,
expenses, including legal fees and other expenses of investigation and defending
claims and lawsuits, causes of action or suits which shall be suffered by or
arise against the aforesaid parties pursuant to the action or inaction of such
parties under this Agreement.
3.7 Proxy Holder shall not resign or cease to act as Proxy Holder until a
successor Proxy Holder is licensed or granted exemption from licensing by the
Nevada Gaming Authorities. In the event of the death or in the event that Proxy
Holder is adjudicated an incompetent, and a guardian or conservator is appointed
for his Person, business, assets or estate, and such adjudication is not set
aside or reversed or stayed within sixty (60) days from the date of such
adjudication, or, in the event of the total physical or mental disability of
Proxy Holder which persists for a continuous period of six (6) months, the Board
of Directors of the Company shall select a successor Proxy Holder to serve until
the termination of this Agreement. The successor Proxy Holder shall be a member
of the Company's Board of Directors licensed or found suitable by the Nevada
Gaming Authorities or a bank or trust company licensed by the State of Nevada or
the United States (hereinafter the "Institutional Proxy Holder"), with capital
in excess of $100,000,000.00. The successor Institutional Proxy Holder shall
immediately seek exemption from licensing pursuant to the provisions of Nevada
Revised Statute 463.175.
ARTICLE 4
Powers, Rights and Duties of Shareholders
-----------------------------------------
4.1 The Shareholders shall receive from the Company written notice of any
subject matter that will be presented for approval, consent or ratification to
the Shareholders of the Company at least forty-five (45) calendar days prior to
the date on which the Shareholders of the Company shall vote on, or consent to,
such subject matter. The Company shall provide a copy of such notice to the
Nevada Board Chairman contemporaneous with service of such notice on the
Shareholders.
4.2 The terms of this Agreement do not obligate any Person other than the
Shareholders, their Affiliates, the Company, and the Proxy Holder and will
terminate as to any shares of Common Stock of the Company transferred by
Redstone or NAI in accordance with the provisions of paragraph 2.4 hereof.
4.3 The Shareholders shall submit to the Nevada Board Chairman a copy of
any report, form or other document filed by Redstone or NAI with the United
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States Securities and Exchange Commission ("SEC"), relative to the Company
contemporaneously with filing such report, form or document with the SEC.
4.4 The Shareholders shall submit to the Nevada Board Chairman written
notice within ten (10) business days of the sale or other disposition of the
Common Stock or any other securities issued by the Company owned by the
Shareholders. The written notice required by this paragraph 4.4 shall specify
the type and number of securities involved in a reported transaction, and the
consideration provided for the disposition of such securities.
ARTICLE 5
Representations and Warranties of Shareholders
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Each Shareholder, jointly and severally, hereby represents and warrants to
the Company and the Proxy Holder that such Shareholder is the record or
beneficial owner of the shares of Common Stock as set forth in Exhibit A to this
Agreement, free and clear of any proxy or voting restrictions other than
pursuant to this Agreement.
ARTICLE 6
Miscellaneous Provisions
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6.1 Irrevocable Proxy. Except as provided in paragraphs 2.3 through 2.6 and
4.2 hereof, the proxy created by this Agreement is irrevocable.
6.2 Titles and Subtitles. Titles of the paragraphs and subparagraphs are
placed herein for convenient reference only and shall not to any extent have the
effect of modifying, amending or changing the express terms and provisions of
this Agreement.
6.3 Words and Gender or Number. As used herein, unless the context clearly
indicates the contrary, the singular number shall include the plural, the plural
the singular, and the use of any gender shall be applicable to all genders.
6.4 Execution in Counterpart. This Agreement may be executed in any number
of counterparts, each of which shall be taken to be an original.
6.5 Severability. In the event any parts of this Agreement are found to be
void, the remaining provisions of this Agreement shall nevertheless be binding
with the same effect as though the void parts were deleted.
6.6 Effective Date. This Agreement shall be effective only upon execution
by all of the proposed parties.
6.7 Waiver. No waiver of any provisions of this Agreement shall be valid
unless in writing and signed by the Person or party against whom charged.
6.8 Applicable Law. Except as provided in paragraph 6.9 hereof, this
Agreement shall be subject to and governed by the laws of the State of Delaware.
6.9 Regulatory Jurisdiction. This Agreement is subject to the jurisdiction
of the Nevada Gaming Authorities and shall be subject to the provisions of
Chapter 463 of the Nevada Revised Statutes and the Regulations of the Nevada
Gaming Commission in relation to all gaming matters. In this regard, the laws of
the State of Nevada shall govern the validity, construction, performance and
effect of this Agreement.
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6.10 Entire Agreement. This Agreement contains the entire agreement between
the parties.
6.11 Certain Judicial Remedies. The parties to this Agreement acknowledge
and agree that irreparable damage would result in the event any provision of
this Agreement was not performed in accordance with the terms hereof and that
the parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy at law or in equity.
6.12 Notices. Every and all notice required hereunder shall be given by
personal service, telecopy transmittal or by overnight courier, to the parties
at the following addresses listed in this Agreement; provided, however, any
party may change its address by written notice to the other parties:
As to the Company WMS Industries Inc.
0000 Xxxxx Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
As to the Proxy Holder Xxxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx
0000 Xxxxx Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Telecopy No.: (000) 000-0000
As to Shareholders Xxxxxx X. Xxxxxxxx
c/o Xxxxxxxx X. Xxxxxx
Executive Vice President
Viacom, Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy No.: (000) 000-0000
As to Nevada Board Chairman: Xxxxxxx X. Bible
State Gaming Control Board
0000 Xxxx Xxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxx 00000
Telecopy No.: (000) 000-0000
6.13 Assignment. This Agreement shall not be assigned by operation of law
or otherwise.
IN WITNESS WHEREOF, the parties have entered into this Agreement effective
as of this 25th day of August, 1995.
WMS Industries, Inc. Dated: September 21, 1995
By: /s/ Xxxxxx X. Xxxx, Xx. /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
/s/ Xxxxx X. Xxxxxxxx National Amusements, Inc.
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Xxxxx X. Xxxxxxxx
By: /s/ Xxxxxx X. Xxxxxxxx
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/s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
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Exhibit A
SCHEDULE OF AFFECTED COMMON STOCK
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Name of Stockholder Number of Shares
- ------------------- -----------------
Xxxxxx X. Xxxxxxxx 3,033,800
National Amusements, Inc. 2,895,300
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TOTAL: 5,929,100
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