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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) April 6, 1998
WMS INDUSTRIES INC.
(Exact Name of Registrant as Specified in Charter)
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<S> <C> <C>
DELAWARE 1-8300 36-2814522
(State or Other Jurisdiction (Commission File Number) (IRS Employer Identification No.)
of Incorporation)
</TABLE>
3401 NORTH CALIFORNIA AVENUE
CHICAGO, ILLINOIS 60618
(Address of Principal Executive Offices) (Zip Code)
Telephone Number, Including Area Code 773-961-1111
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Item 2. Disposition of Assets.
On April 6, 1998, the Registrant completed the spin-off of its video game
business conducted by Midway Games Inc. ("Midway") through the distribution (the
"Distribution") to the Registrant's stockholders of all 33,400,000 shares of
Midway common stock, par value $.01 per share ("Midway Common Stock"), held by
the Registrant. Previously, WMS sold shares representing approximately 13.25% of
the outstanding Midway Common Stock in an initial public offering in October
1996. As a result of Midway's initial public offering and the Distribution, the
Registrant no longer owns any shares of Midway Common Stock.
Holders of the Registrant's common stock, par value $.50 per share ("WMS
Common Stock"), received a pro-rata, tax-free dividend of 1.19773 shares of
Midway Common Stock for every share of WMS Common Stock owned at the close of
business on March 31, 1998 (the "Record Date"). No consideration was paid by
such holders. The distribution ratio used to compute the number of shares of
Midway Common Stock distributed for each share of WMS Common Stock held (the
"Distribution Ratio") reflects 27,886,021 shares of WMS Common Stock outstanding
on the Record Date. Fractional shares were aggregated and sold in the open
market on April 6, 1998, the net proceeds of which were mailed pro rata to the
stockholders entitled to the fractional share interests. Information about the
transaction was mailed to the Registrant's stockholders on April 6, 1998
disclosing the Distribution Ratio, the fractional share treatment and the
Distribution's expected tax consequences.
In connection with the Distribution, Neil D. Nicastro resigned as
President, Chief Executive Officer and Chief Operating Officer of the Registrant
and Louis J. Nicastro, Chairman of the Board of the Registrant, now serves the
Registrant additionally as President, Chief Executive Officer and Chief
Operating Officer.
In addition, the Registrant's stockholders on April 6, 1998 received a
dividend of one stock purchase right for each outstanding share of WMS Common
Stock held on April 6, 1998. The terms of the rights are set forth in a Rights
Agreement dated as of March 5, 1998 between the Registrant and The Bank of New
York, as rights agent, and the summary of such terms is incorporated herein by
reference to the section "ANTI-TAKEOVER PROPOSALS -- The Anti-Takeover
Amendments -- Rights Agreement" in the Company's definitive Proxy Statement as
filed with the Securities and Exchange Commission on December 12, 1997.
Item 7. Pro Forma Financial Information and Exhibits.
Pro Forma Financial Information.
Commencing with the Registrant's financial statements for the fiscal year
ended June 30, 1997, the Registrant reported its interests in the video game
business as discontinued operations.
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Accordingly, the Registrant previously reported the information required
pursuant to Article 11 of Regulation S-X with respect to the Distribution in
previous filings with the Securities and Exchange Commission.
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Exhibits.
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1 Employment Agreement, dated as of April 6, 1998, between the
Registrant and Louis J. Nicastro.
2 Severance Agreement, dated March 5, 1998, between the Registrant and
Neil D. Nicastro.
3 Consulting Agreement, dated March 5, 1998, between the Registrant and
Neil D. Nicastro.
4 Form of Rights Agreement, dated as of March 5, 1998, between the
Registrant and The Bank of New York, as rights agent (incorporated
herein by reference to the Form 8-A (File No. 1-8300) filed with the
Securities and Exchange Commission on March 26, 1998).
5 Press release, dated April 6, 1998.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WMS INDUSTRIES INC.
April 16, 1998 By: /s/ Orrin J. Edidin
---------------------------
Orrin J. Edidin
Vice President, Secretary
and General Counsel
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INDEX TO EXHIBITS
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EXHIBIT. DESCRIPTION.
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1 Employment Agreement, dated as of April 6, 1998, between the
Registrant and Louis J. Nicastro.
2 Severance Agreement, dated March 5, 1998, between the Registrant and
Neil D. Nicastro.
3 Consulting Agreement, dated March 5, 1998, between the Registrant and
Neil D. Nicastro.
5 Press release, dated April 6, 1998.
</TABLE>
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EXHIBIT 1
EMPLOYMENT AGREEMENT
AGREEMENT dated as of April 6, 1998, by and between WMS INDUSTRIES INC.
("WMS"), a Delaware corporation with offices at 3401 North California Avenue,
Chicago, IL 60618 and LOUIS J. NICASTRO ("Nicastro"), residing at 340 Polmer
Park, Palm Beach, Florida 33480.
W I T N E S S E T H :
WHEREAS, Nicastro was Chief Executive Officer of WMS for many years prior
to his resignation on July 1, 1996; and
WHEREAS, in order to facilitate the spin-off of the shares of stock of
Midway Games Inc. ("Midway") owned by WMS to the stockholders of WMS, the
current Chief Executive Officer and Chief Operating Officer of WMS has been
requested to relinquish his positions as an officer of WMS to devote his full
time to Midway; and
WHEREAS, WMS desires to assure the continuation of experienced executive
leadership and toward that end desires to employ Nicastro as its President,
Chief Executive Officer; and Chief Operating Officer, and Nicastro is willing to
be so employed.
NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements hereinafter set forth, the parties hereto agree as follows:
1. WMS hereby employs Nicastro, and Nicastro agrees to be employed by WMS
pursuant hereto, to perform the duties of the President, Chief Executive Officer
and Chief Operating Officer of WMS and such other supervisory or executive
duties on behalf of WMS as the Board of Directors of WMS shall determine.
2. The term of Nicastro's employment hereunder shall commence on the date
hereof and terminate on June 30, 2000 (the "Original Term"); provided, however,
that the term of Nicastro's employment shall be deemed automatically extended
from time to time such that the term of such employment shall at no time be less
than two years (the "Extended Term"); and provided further, that Nicastro's
services hereunder may be terminated by either party, effective upon expiration
of the Original Term or the Extended Term upon written notice from the
terminating party to the other party dated and received at least two (2) years
prior to the respective termination date.
3. (a) WMS shall pay to Nicastro in respect of each year of his employment
hereunder, a base salary at the rate of $450,000 per annum, payable in equal
bi-weekly installments, or such greater amount as the Board of Directors of WMS
shall from time to time determine.
(b) In addition to other compensation hereunder, Nicastro shall be
entitled to participate in and receive the benefits of all employee benefits and
perquisites generally available to senior executive employees of WMS. Nicastro
shall also be entitled to receive such special bonuses as may be determined from
time to time by the Board of Directors of WMS.
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(c) Currently herewith, WMS is granting to Nicastro ten (10) year
options to purchase 500,000 shares of WMS Common Stock at the closing price of
such stock on the New York Stock Exchange on the date hereof. Such options shall
be exercisable by Mr. Nicastro or, in the event of Mr. Nicastro's death, his
estate, for their full ten (10) year term whether or not Mr. Nicastro remain
employed by WMS; provided, however, such options shall not be exercisable at any
time after Nicastro becomes employed on a full time basis by a competitor of WMS
in violation of Paragraph 6(a) of this Agreement.
4. WMS confirms its commitment, pursuant to a letter agreement dated July
1, 1996, that during the life of Nicastro and Nicastro's wife Elaine, if she
survives him, to reimburse them for all medical and dental expenses incurred by
them to the extent such expenses are not otherwise reimbursed by insurance
provided by WMS. WMS shall also reimburse Nicastro for all expenses reasonably
incurred by him in connection with the business of WMS, including, but not
limited to, such items as entertainment, traveling, hotel, gifts and similar
items as shall be deemed necessary and commensurate with his position as
President, Chief Executive Officer and Chief Operating Officer of WMS. Nicastro
will present receipts or vouchers for any requested reimbursements in accordance
with WMS' normal policy and will comply with any appropriate procedures
established by WMS to provide for payment or withholding of income or other
taxes as may be required by law to be paid or withheld in connection with any
such reimbursements.
5. Nicastro agrees that, throughout the period in which he is required to
perform services hereunder, he will devote his attention, knowledge and skills
faithfully, diligently and to the best of his ability in furtherance of the
business of WMS and businesses in which WMS has an interest, and in the full
performance of the duties assigned to him hereunder, subject at all times, to
the direction and control of the Board of Directors of WMS, and he shall not,
throughout such period, enter into the service of, or be employed in any
capacity or for any purpose whatsoever by, any person, firm or corporation other
than WMS and businesses in which WMS has an interest. Nothing contained in this
paragraph shall be deemed to prohibit Nicastro from (i) investing his assets or
funds, so long as the business of any such entity in which he shall make his
investments shall not be in direct competition with that of WMS, except that
Nicastro may invest in a corporate entity in competition with WMS if such
corporation's stock is listed for trading on a national stock exchange or traded
in the over-the-counter market and Nicastro's holdings therein are not in
violation of WMS' conflicts of interest policy then in effect; or (ii) acting as
a director, trustee, officer, or upon a committee of any other firm, trust or
corporation where such positions do not unreasonably interfere with the services
to be rendered by Nicastro hereunder. WMS acknowledges that Nicastro may
continue to perform services for businesses in which WMS had an interest at the
time his services commenced even after WMS' interest terminates, so long as such
services do not unreasonably interfere with the services to be rendered by
Nicastro hereunder.
6. Except as permitted in Paragraph 5 hereof, Nicastro covenants and agrees
as follows:
(a) During the period of his employment hereunder, and for a further
period of one (1) year thereafter he shall not, directly or indirectly own,
manage, operate, join, control, participate in, invest in, or otherwise be
connected with, in any manner, whether as an officer, director, employee,
partner, investor or otherwise, or allow his name to be used in any business or
enterprise which competes in any way with WMS in any city or trade territory in
the United States (including Puerto Rico) or Canada where WMS is directly or
indirectly, through distributors or others, engaged in the operation of its
business.
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(b) During the term of this Agreement and thereafter, he shall hold in a
fiduciary capacity for the benefit of WMS, all information, knowledge and data
relating to or concerned with its operations, sales, businesses and affairs, and
he shall not disclose or divulge any such information, knowledge or data to any
person, firm or corporation other than to WMS or its designees, except as may
otherwise be required in connection with the business and affairs of WMS.
Nicastro acknowledges that the provisions of this Paragraph 6 are
reasonable and necessary for the protection of WMS, and that each provision, and
the period or periods of time, geographic areas and types and scope of
restrictions on the activities specified herein are, and are intended to be,
divisible. In the event that any provision of this Paragraph 6, including any
sentence, clause or part hereof, shall be deemed contrary to law or invalid or
unenforceable in any respect by a court of competent jurisdiction, the remaining
provisions shall not be affected, but shall, subject to the discretion of such
court, remain in full force and effect and any invalid and unenforceable
provisions shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited to the extent necessary to render the same
valid and enforceable.
7. (a) Except as provided in the next succeeding subparagraph, in the event
of a breach or threatened breach by either WMS or Nicastro of any obligations
under this Agreement, the parties hereto acknowledge that WMS or Nicastro, as
the case may be, will not have an adequate remedy at law, and shall be entitled
to such equitable and injunctive relief as may be available to restrain
violations of the provisions of this Agreement. Nothing in this subparagraph
shall be construed as prohibiting the parties hereto from pursuing any other
remedies available for such breach or threatened breach, including the recovery
of damages for such breach or threatened breach.
(b) Notwithstanding anything contained in the preceding subparagraph to
the contrary:
(i) (A) If WMS terminates Nicastro's employment in violation of this
Agreement and Nicastro gives the written notice to WMS provided for in
subparagraph 7(c) hereof; or (B) if at any time during the term of this
Agreement, individuals who presently constitute the Board of Directors
of WMS, or who have been recommended for election to the Board by
two-thirds of the Board consisting of individuals who are either
presently on the Board or such recommended successors (such present
directors or recommended directors being hereafter referred to as
"Acceptable Directors"), cease for any reason to constitute at least a
majority of such Board, and Nicastro gives the written notice to WMS
provided for in subparagraph 7(d) hereof, WMS shall pay to Nicastro
within fifteen (15) days (or, if later, five (5) business days after
Nicastro's delivery of the notice of termination described in
subparagraph 7(c) below) after such termination pursuant to clause (A)
or (B) hereof, as the case may be, as severance pay and liquidated
damages, in lieu of any other rights or remedies which might otherwise
be available to him under this Agreement, and without mitigation of any
kind or amount, whether or not Nicastro shall seek or accept other
employment, a lump sum payment equal in amount to three times Nicastro's
base salary at the highest annual rate in effect during the one-year
period immediately preceding termination. The payment provided for in
this subparagraph 7(b)(i) shall be paid in full, without discount to
present value. In addition to such lump sum payment to Nicastro,
Nicastro shall have the right, exercisable within thirty (30) days after
such termination pursuant to clauses (A) or (B) hereof, to sell to WMS
any or all options held by Nicastro to
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purchase WMS common stock and options to purchase the securities of any
other company at least 20% of the voting securities of which are owned
by WMS (a "Related Company") at a price per option equal to the amount
by which (i) the average closing price of the WMS common stock or the
securities of such Related Company, as the case may be, on the New York
Stock Exchange (or other applicable trading market if not listed on the
New York Stock Exchange) during the thirty-day period immediately
preceding the date on which he notifies WMS of his election to sell such
options plus the fair market value per share of other securities or
assets which Nicastro would be entitled to receive upon exercise of such
options exceeds (ii) the option exercise price for each such share. All
options not yet fully exercisable shall be deemed fully exercisable for
purposes of the foregoing computation. Such payments shall be made by
WMS at the time provided in this subparagraph 7(b)(i) and shall not
require any further authorization or approval of the Board of Directors
of WMS.
(ii) If it shall be determined that any amount payable under
subparagraph 7(b) by WMS to or for the benefit of Nicastro (a "Base
Payment") would be subject to the excise tax (the "Excise Tax") imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code"), then Nicastro shall be entitled to receive an additional
payment (the "Gross-up Payment") in an amount such that the net amount
retained by Nicastro, after the calculation and deduction of any Excise
Tax on the Base Payment and any federal, state, and local income taxes
and Excise Tax on the Gross-Up Payment, shall be equal to the Base
Payment. In determining this amount, the amount of the Gross-Up Payment
attributable to federal income taxes shall be reduced by the maximum
reduction in federal income taxes that could be obtained by the
deduction of the portion of the Gross-Up Payment attributable to state
and local income taxes. Finally, the Gross-Up Payment shall be reduced
by income or Excise Tax withholding payments made by WMS to any federal,
state, or local taxing authority with respect to the Gross-Up Payment
that was not deducted from compensation payable to Nicastro.
(iii) All determinations required to be made under subparagraph
7(b)(ii), including whether and when a Gross-Up Payment is required, the
amount of such Gross-Up Payment, and the assumptions to be utilized in
arriving at such determination, except as specified above, shall be made
by WMS' independent auditors (the "Accounting Firm"), which shall
provide detailed supporting calculations both to WMS and Nicastro within
fifteen business days after the receipt of notice from Nicastro that
there should be a Gross-Up Payment. The determination of tax liability
made by the Accounting Firm shall be subject to review by Nicastro's tax
advisor, and, if Nicastro's tax advisor does not agree with the
determination reached by the Accounting Firm, then the Accounting Firm
and Nicastro's tax advisor shall jointly designate a nationally
recognized public accounting firm, which shall make the determination.
All fees and expenses of the accountants and tax advisors retained by
either Nicastro or WMS shall be borne by WMS. Any Gross-Up Payment shall
be paid by WMS to Nicastro within five days after the receipt of the
determination. Any determination by a jointly designated public
accounting firm shall be binding upon WMS and Nicastro.
(c) WMS shall be deemed to have terminated Nicastro's employment in
violation of this Agreement for all purposes hereunder, if, among other things,
without his prior written consent:
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(i) Nicastro is placed in any position of lesser stature than that
of President, Chief Executive Officer and Chief Operating Officer of
WMS; is assigned duties inconsistent with such positions or duties
which, if performed, would result in a significant change in the nature
or scope of powers, authority, functions or duties inherent in such
positions on the date hereof; is assigned performance requirements or
working conditions which are at variance with the performance
requirements and working conditions in effect on the date hereof; or is
accorded treatment on a general basis which is in derogation of his
status as President, Chief Executive Officer and Chief Operating
Officer;
(ii) Nicastro ceases to serve as a member of the Board of Directors
of WMS;
(iii) WMS discontinues or reduces (from the highest level in effect
during the term of this Agreement) the amount of base salary payable to
Nicastro pursuant to subparagraph 3(a) of this Agreement; or
(iv) WMS discontinues or reduces (from the level in effect on the
date hereof) the perquisites or fringe benefits inherent in Nicastro's
position on the date hereof;
and Nicastro gives written notice of his election to deem such act to constitute
termination, in which event termination pursuant to this subparagraph 7(c) shall
be deemed to have occurred upon the date of the giving of such notice.
(d) In the event of a change in the constitution of the Board of
Directors of WMS such that it does not include a majority of Acceptable
Directors as provided in Clause (B) of subparagraph 7(b)(i) hereof, and in the
further event that at any time thereafter, Nicastro gives written notice of his
election to terminate this Agreement, termination pursuant to this subparagraph
7(d) shall be deemed to have occurred upon the date of the giving of such
notice.
8. This Agreement may not be assigned by Nicastro but shall inure to the
benefit of and shall be binding upon the successors and assigns of WMS.
9. All notices shall be addressed to each party hereto at its address
set forth on the first page of this Agreement or as such address may be changed
from time to time by notice in accordance with this Paragraph 9 and shall be
delivered in person or sent by mail with first class postage prepaid or by
express mail service for next day delivery or other responsible overnight
delivery service, and, if sent by mail shall be deemed to have been given and
received two business days after the date of deposit in the mails and, if sent
by express mail service or overnight delivery service shall be deemed to have
been given and received on the next business day after the date of the delivery
of the notice to such service.
10. Any waiver by either WMS or Nicastro of any breach of any provisions
of this Agreement by the other party shall not operate or be construed as a
waiver of any other or subsequent breach hereof.
11. This Agreement shall be governed and construed in accordance with
the substantive laws of the State of Illinois applicable to agreements to be
performed entirely therein.
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12. No amendment or modification of this Agreement shall be valid and
binding unless made in writing and signed by both of the parties hereto.
13. In the event that any provision of this Agreement, including any
sentence, clause or part hereof, shall be deemed contrary to law or invalid or
unenforceable in any respect by a court of competent jurisdiction, the remaining
provisions shall not be affected, but shall, subject to the discretion of such
court, remain in full force and effect and any invalid and unenforceable
provision shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited to the extent necessary to render the same
valid and enforceable.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
WMS INDUSTRIES INC.
By: /s/ Harold H. Bach, Jr.
----------------------------------
Harold H. Bach, Jr.
Vice President - Finance
/s/ Louis J. Nicastro
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LOUIS J. NICASTRO
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EXHIBIT 2
WMS INDUSTRIES INC.
3401 North California Avenue
Chicago, IL 60618
March 5, 1998
Mr. Neil D. Nicastro
999 North Sheridan Road
Lake Forest, Illinois 60045
Dear Mr. Nicastro:
In connection with the planned spin-off of all of the shares of Midway
Games Inc. ("Midway") owned by WMS Industries Inc. (the "Company") to the
stockholders of the Company, you have been asked to relinquish your positions as
President, Chief Executive Officer and Chief Operating Officer of the Company
and to undertake full time duties on behalf of Midway. The Company recognizes
that such change in your employment will benefit the Company by facilitating the
Midway spin-off. The Company further recognizes that if the Company requires you
to resign your positions as President, Chief Executive Officer and Chief
Operating Officer of the Company, the Company would be deemed to violate the
Third Amended and Restated Employment Agreement dated July 1, 1996 between you
and the Company (the "WMS Employment Agreement"). After consideration of
numerous factors, including the terms of the WMS Employment Agreement, the
advice of Pearl Meyer & Partners, Inc., compensation consultants, and the
anticipated benefits to the Company of the proposed spin-off, you and the
Company have agreed as follows:
a. Except as otherwise specifically provided herein, the WMS Employment
Agreement is terminated effective on the spin-off distribution date (the
"Effective Date"). If the Effective Date does not occur by June 30, 1998, this
letter shall be of no further force and effect.
b. You will resign as President, Chief Executive Officer and Chief
Operating Officer of the Company, effective on the Effective Date, and you will
thereafter work full-time for Midway pursuant to your employment agreement with
Midway dated July 1, 1996, as the same may be amended from time to time. You
will continue to serve as a director of the Company as well as a consultant to
the Company pursuant to a consulting agreement dated the date hereof.
c. As full consideration for payments that would otherwise be made to you
or on your behalf under the WMS Employment Agreement with respect to base
salary, bonus, retirement and death benefits, (i) you will be paid a lump sum of
$2,500,000, payable on the Effective Date and (ii) you will receive 10 year
options to purchase 250,000 shares of the Company's common stock at an exercise
price equal to the closing price of the Company's Common Stock on the New York
Stock Exchange on the later to occur of (i) the Effective Date or (ii) the first
day the Company's Common Stock trades ex-dividend on such Exchange. It is
understood that the foregoing cash payment will be subject to withholding of
income or other taxes as may be required by law to be paid or withheld by the
Company. The $1,000,000 life insurance policy referred to in paragraph 3(c) of
the WMS Employment Agreement will be assigned to Midway on the Effective Date.
The options referred to above shall be exercisable by you or, in the event of
your death, by your estate, for their full 10 year term whether or not you
remain an employee of or consultant to the Company or Midway;
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Mr. Neil D. Nicastro 2 March 5, 1998
provided, however, such Options shall not be exercisable any time after you
become employed on a full time basis by a competitor of the Company or Midway
(other than the Company or Midway) in violation of your employment agreements
with the Company or Midway.
d. The provisions of Paragraph 8 of the WMS Employment Agreement shall
continue in full force and effect.
e. The Company shall take such steps as may be necessary to permit all
stock options currently held by you or received by you pursuant to this letter
to remain exercisable by you for the full term of those options whether or not
you continue to serve the Company as a director or in any other capacity.
If the foregoing accurately sets forth your understanding, please execute a
copy of this letter in the place provided below.
Very truly yours,
WMS INDUSTRIES INC.
By: /s/ Harold H. Bach, Jr.
---------------------------------
Harold H. Bach, Jr.
Vice President - Finance
Accepted and Agreed to:
/s/ Neil D. Nicastro
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NEIL D. NICASTRO
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EXHIBIT 3
WMS INDUSTRIES INC.
3401 North California Avenue
Chicago, IL 60618
March 5, 1998
Mr. Neil D. Nicastro
999 North Sheridan Road
Lake Forest, Illinois 60045
Re: Consulting Agreement
Dear Mr. Nicastro:
Reference is made to a letter agreement between you and WMS Industries Inc.
("WMS") dated the date hereof pursuant to which your employment by WMS will be
terminated effective on the distribution date for the spin-off of the Midway
Games Inc. shares owned by WMS (the "Effective Date"). This letter sets forth
our agreement pursuant to which WMS shall retain you and you shall serve as a
consultant to WMS effective from and after the Effective Date.
You agree to make yourself reasonably available at WMS' request during the
term hereof, to render such services concerning WMS as the Board of Directors or
the Chairman of the Board and Chief Executive Officer of WMS may reasonably
request. In rendering such services, you will not be required to report on any
periodic basis to WMS' offices or any other location and may render such
services by telephone or written communication. WMS acknowledges that you have
other activities, obligations and employments which command your time on a
full-time basis and your services hereunder will be subject to such activities,
obligations and employments. WMS will give you reasonable prior notice of the
times your services will be needed and you will have a reasonable time after
notice from WMS to render such requested services. It is not expected that you
will be required to devote more than 5 hours a month to your consulting services
hereunder.
As compensation for your services hereunder, WMS will pay you $1,000 per
month during your term as a consultant.
The term of this letter agreement shall be 5 years, and shall be
automatically renewable for successive one year terms unless either party shall
give notice of termination not less than 6 months prior to the end of the then
expiration date of this letter agreement.
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Mr. Neil D. Nicastro 2 March 5, 1998
If the Effective Date does not occur by June 30, 1998, this letter
agreement shall be of no force or affect.
Please indicate your agreement to the foregoing by signing this letter in
the place provided below.
Very truly yours,
WMS INDUSTRIES INC.
By: /s/ Harold H. Bach, Jr.
-------------------------------
Harold H. Bach, Jr.
Vice President-Finance
Accepted And Agreed To:
/s/ Neil D. Nicastro
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Neil D. Nicastro
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EXHIBIT 5
WMS INDUSTRIES INC.
3401 North California Avenue
Chicago, Illinois 60618
WMS INDUSTRIES ANNOUNCES DISTRIBUTION OF MIDWAY SHARES
CHICAGO-- (BUSINESS WIRE) -- April 6, 1998 -- WMS Industries Inc. (NYSE:
WMS) announced today that the previously announced spin-off of its approximately
86.7% interest in Midway Games Inc. (NYSE: MWY) has been completed. WMS
stockholders of record on March 31, 1998 today were issued 1.19773 shares of
Midway common stock for each share of WMS common stock owned. Fractional shares
will be sold and the net proceeds paid in cash. The distribution ratio reflects
27,886,021 shares of WMS common stock outstanding on the record date.
WMS Industries Inc. is engaged in the design, manufacture and sale of
pinball and novelty games and video lottery terminals and gaming devices. Midway
Games Inc. is engaged in the design, distribution and sale of video games.
CONTACT:
WMS Industries Inc. Joseph N. Jaffoni, Kathleen M. Holmes
Harold H. Bach, Jr. OR Jaffoni & Collins Incorporated
Chief Financial Officer 212/835-8500, [email protected]
773/961-1111
