EXHIBIT 10.3
PURCHASE AND SETTLEMENT AGREEMENT
This Purchase and Settlement Agreement is entered into by and between WMS
INDUSTRIES INC., a Delaware corporation (the "Company"), and XXXXX X. XXXXXXXX
("Grantee"), a Florida resident, as of May 7, 2003.
RECITALS
A. The Company has previously granted to Grantee 250,000 shares of its
common stock, $.50 par value (the "Restricted Shares"), subject to
certain vesting conditions set forth in a Restricted Stock Agreement
dated March 1, 2002 (the "Restricted Stock Grant").
B. The Board of Directors of the Company has determined as of the date
hereof that (a) the Grantee has met the performance conditions for
the vesting of the Restricted Shares and (b) the revisions to the
Company's legacy operating system has been approved by gaming
regulators in major jurisdictions and have reached an acceptable
level of field performance, such that the only remaining condition
for vesting of the Restricted Stock Grant is the occurrence of June
30, 2003.
C. The Board of Directors of the Company has further determined that,
based on the recent appreciation in the market price of the common
stock of the Company and the corresponding increase in the
compensation expense to the Company in connection with the vesting
of the Restricted Shares, it is in the best interests of the Company
to purchase Grantee's right to the Restricted Shares which are the
subject of the Restricted Stock Grant at $14.00 per share,
representing a discount of $0.50 per share from the market price of
the common stock of the Company as of the close of business on May
6, 2003.
D. The Company is willing to purchase and Grantee is willing to sell
his rights under the Restricted Stock Grant on the terms set forth
below.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and promises contained
herein and for other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, the parties hereto agree as follows:
1. Purchase of Rights. Upon the terms and subject to the conditions set
forth herein, Grantee hereby sells to the Company his rights to the
Restricted Shares under the Restricted Stock Grant. In consideration
for the Restricted Shares and the termination of Grantee's rights
under the Restricted Stock Grant, the Company agrees to pay to
Grantee an amount equal to Three Million Five Hundred Thousand
Dollars ($3,500,000). Payment will be made within one (1) business
day of the date hereof via wire transfer to an account in Grantee's
name, as directed by Grantee.
2. Return of Restricted Shares. Within one (1) business day of the date
hereof, Grantee shall endorse the Restricted Shares to the Company
and shall deliver to the Company the certificate(s) representing
such Restricted Shares.
3. Non-Solicitation and Non-Compete. Grantee agrees that, prior to June
30, 2010, he will not, directly or indirectly, without the prior
written consent of the Company, induce or influence, or seek to
induce or influence, any person who is engaged by the Company or any
affiliate of the Company as an employee, agent, independent
contractor or otherwise, to terminate his employment or engagement,
nor shall he directly or indirectly, through any person, firm or
corporation, employ or engage, or solicit for employment or
engagement, or advise or recommend to any other person or entity
that such person or entity employ or engage or solicit for
employment or engagement, any person or entity employed or engaged
by the Company or any affiliate of the Company. In addition, Grantee
agrees that the non-compete provisions of paragraph 8(a) of the
employment agreement dated September 2, 1999 between Grantee and the
Company will continue in effect during Grantee's lifetime.
4. Termination and Release of Restricted Stock Grant. Grantee hereby
agrees to terminate the Restricted Stock Grant effective as of the
date hereof and that such Grant will have no further force or
effect. Grantee further releases and discharges the Company from all
claims that Grantee has or may have had under the Restricted Stock
Grant.
IN WITNESS WHEREOF, the parties have executed this Purchase and Settlement
Agreement as of the date set forth above.
WMS INDUSTRIES INC. GRANTEE
By: /s/ Xxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxx Xxxxx X. Xxxxxxxx
President and Chief
Executive Officer
