VOTING RIGHTS AGREEMENT
This AGREEMENT dated as of the 29th day of February, 1996, by and among
Albert S. Wells, Jr. ("ASW"), Randall S. Wells ("RSW"), Anthony Spier ("Spier"),
Allan Gardner ("Gardner"), John R. Blouin ("Blouin"), Wells-Gardner Electronics
Corporation, an Illinois corporation (the "Company"), James Industries, Inc., an
Illinois corporation ("JI"), and James J. Roberts, Jr., individually and as
trustee of the James J. Roberts, Trust, UTA Dated 12-23-91 (collectively
"Roberts");
WHEREAS, Roberts and Blouin own beneficially all of the outstanding
Capital Stock of JI and Roberts owns beneficially 551,836 of the issued and
outstanding Common Shares of the Company (which Common Shares, together with
any Common Shares of the Company hereafter acquired by Roberts or JI are
hereinafter referred to as "Roberts' Common Shares") as follows:
Shareholder Shares Owned
James J. Roberts, Jr. 1,760
James J. Roberts, Jr., 550,076
as trustee
WHEREAS, all of such Roberts' Common Shares are pledged to various
pledges as collateral for loans; and
WHEREAS, the parties deem it to be in their mutual best interests and
in the best interests of all of the Company's shareholders that an agreement be
entered into concerning the voting of the parties' Common Shares for directors
of the Company; and
WHEREAS, the Company is entering into a Sales Representative Agreement
(the "Representative Agreement") with JI and Roberts concurrently with the
execution hereof;
NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements contained herein, it is hereby agreed as follows:
1. Voting For Directors.
(a) Until Termination of the Representative Agreement (as
hereinafter defined) or December 31, 2000, whichever shall first occur, the
parties shall vote (and, if applicable, shall direct all pledgees to vote)
their Common Shares of the Company at every election of directors of the
Company, for the election of such slate of nominees as the nominating committee
of the Board of Directors (or if there is no nominating committee, then such
other committee, or the Board of Directors, as the case may be, performing
such function) shall designate, provided that such slate shall always include
Roberts, Blouin, RSW, Gardner and Spier (collectively, the "Nominees"), or any
of the Nominees as are willing and able to serve as directors of the Company.
(b) Upon the death or incapacity of any of the Nominees, another
person shall be designated as set forth below; provided, however, that, if the
designated person is disapproved by at least three of the remaining Nominees,
another person shall be designated as set forth below until not so disapproved:
(i) Upon the death or incapacity of Blouin, Roberts or Roberts'
estate or guardian shall have the right to designate another person as Nominee
to replace John R. Blouin for purposes of paragraph 1(a) above;
(ii) Upon the death or incapacity of Roberts, his estate or guardian
shall have the right to designate another person as Nominee to replace Roberts
for purposes of paragraph 1(a) above;
(iii) Upon the death or incapacity of Gardner, his estate or guardian
shall have the right to designate another person as Nominee to replace Gardner
for purposes of paragraph 1(a) above; and
(iv) Upon the death or incapacity of RSW, his estate or guardian
shall have the right to designate another person as Nominee to replace RSW for
purposes of paragraph 1(a) above.
(c) In any election of directors in which the number of nominees
exceeds the number of directors to be elected, the parties shall vote (and, if
applicable, shall direct all pledgees to vote) their Common Shares hereunder
in such a manner as to assure the election of the largest number of Nominees.
If, under the circumstances, less than all of the Nominees can be elected, the
parties shall vote (and, if applicable, shall direct all pledgees to vote) their
Common Shares so that the greatest number of Nominees (or their replacements as
set forth in paragraph 1(b) above) can be elected in the following order of
priority: Roberts, Spier, RSW, Gardner, and Blouin.
(d) The obligations of the parties under this paragraph 1 shall
terminate with respect to any Common Shares of the Company which they may
transfer in a bona fide sale or exchange for value.
(e) The obligations of the parties under this paragraph 1 shall be
suspended during any period when the Common Shares of the Company subject to
the terms of this Agreement amount to less than 5% of the then issued and
outstanding Common Shares of the Company.
(f) The obligations of Roberts under this Agreement shall also be
binding upon any of his transferees, except as otherwise provided herein.
2. Death. Within thirty (30) days after the death of Roberts, the
executor or administrator of his estate and the successor trustee of the James
J. Roberts, Jr. Trust, UTA Dated 12-23-91 (the "Trust") shall notify the Company
of the provisions of his will and the provisions of the Trust, if any, governing
the distribution of Roberts' Common Shares. Such executor or administrator and
successor trustee and all beneficiaries and heirs, devisees and legatees of
Roberts, shall be bound by the provisions of paragraph 1 hereof.
3. Additional Definition. "Termination" of the Representative
Agreement shall be deemed to occur if such agreement terminates under paragraph
17 thereof, except that in the event of a termination of the Representative
Agreement by the Company under paragraph 17(b) thereof, for purposes of this
Agreement, Termination shall be deemed to occur on December 31, 2000, or at the
end of any additional period for which the Representative Agreement had then
been automatically renewed under paragraph 17(a) thereof.
4. Endorsement on Stock Certificates. All certificates
representing Roberts' Common Shares shall be endorsed as follows:
"The voting of the shares represented hereby are subject to
restrictions and agreements contained in an agreement dated as of
February 29, 1996 by and among Wells-Gardner Electronics Corporation
and certain of its shareholders, a copy of which is on file with the
Secretary of Wells-Gardner Electronics Corporation."
5. Termination and Amendment. Anything to the contrary
notwithstanding, this Agreement shall terminate and have no further effect on
the earlier of (a) any act or event which provides for termination elsewhere
in this Agreement, or (b) the Termination of the Representative Agreement, or
(c) December 31, 2000. This Agreement may be altered, amended or terminated
(except as otherwise provided herein) at any time only pursuant to an agreement
in writing, executed by or on behalf of the Company, JI and such of the other
parties hereto (or their successors under paragraph 1(b)) who are then serving
as directors of the Company.
6. Entire Agreement. This Agreement constitutes the entire
agreement and final understanding of the parties with respect to the subject
matter hereof and supersedes and terminates any and all prior voting agreements,
prior and/or contemporaneous communications and/or agreements between the
parties, whether written or verbal, express or implied, direct or indirect,
relating in any way to the subject matter hereof including, but not limited
to the Voting Agreement dated April 26, 1994, by and between the parties hereto.
7. Notices. All notices, offers and acceptances hereunder shall
be in writing and shall be deemed to be communicated (except as otherwise
provided herein) when delivered in person or deposited in the U.S. mail, postage
prepaid, by registered mail, addressed to the party concerned at the address
appearing on the Company's records or at such other or additional place as such
party may designate by notice given in accordance with the provisions hereof to
the other parties.
8. Benefit. This Agreement shall be binding as provided herein
upon the parties, their heirs, devisees, legatees, beneficiaries, legal
representatives, successors and assigns.
* * * *
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
WELLS-GARDNER
ELECTRONICS CORPORATION JAMES INDUSTRIES, INC.
By: /s/ ANTHONY SPIER By: /s/ JAMES J. ROBERTS, JR.
Anthony Spier James J. Roberts, Jr.
Its: CEO Its: CEO
/s/ ALBERT S. WELLS, JR. /s/ JAMES J. ROBERTS, JR.
Albert S. Wells, Jr. James J. Roberts, Jr.
/s/ ANTHONY SPIER /s/ JAMES J. ROBERTS, JR.
Anthony Spier James J. Roberts, Jr.
AS TRUSTEE OF THE JAMES J.
/s/ ALLAN GARDNER ROBERTS, JR. TRUST UTA
Allan Gardner DATED 12-23-91
/s/ RANDALL S. WELLS
Randall S. Wells
/s/ JOHN R. BLOUIN
John R. Blouin