Wynn Resorts founder Steve Wynn has agreed to relinquish control of ex-wife Elaine Wynn’s 9.4% stake in the company in the wake of the sexual harassment allegations that saw him step down as Chairman and CEO last week.
In a filing to the US Securities and Exchange Commission on Friday, Wynn Resorts said it had been informed that Mr Wynn had submitted a letter to counsel for the warring parties stating that he no longer contests Ms Wynn’s judicial admission that a 2010 agreement between the pair and co-founder Kazuo Okada was invalid.
The agreement, officially known as the 2010 Stockholders Agreement, gave Mr Wynn control over the trio’s shares in an attempt to ward off any potential takeover bids.
“In light of the significant changed circumstances triggered by Mr Wynn’s resignation, this letter hereby constitutes formal notice that Mr Wynn no longer contests Ms Wynn’s judicial admission that the 2010 Stockholders Agreement is invalid and unenforceable,” the letter, which was included in Wynn Resorts’ filing on Friday, states.
“Accordingly, while Mr Wynn does not agree with Ms Wynn’s bases for claiming the 2010 Stockholders Agreement is now invalid and unenforceable, he does agree that it no longer binds either party. As such, it is Mr Wynn’s position that there is no longer a live controversy between the parties on this issue.
“Mr Wynn plans to advise the court of this development so that it may consider the same and streamline its preparation in advance of next week’s summary judgment hearings.”
The latest development will see Mr Wynn’s control over Wynn Resorts fall to 11.8% pending judicial approval. It will also bring to an end the bitter six-year court battle between Mr and Ms Wynn, which began in 2012 after Okada was ousted and his shares forcibly redeemed by Wynn Resorts amid accusations he provided improper hospitality at Wynn properties to Philippine gaming officials to the tune of US$110,000. Wynn Resorts claimed at the time that Okada had put the company’s gaming license in jeopardy.
Ms Wynn subsequently initiated her own proceedings against her ex-husband to reclaim her 9.4% stake, claiming that Okada’s dismissal rendered their 2010 Stockholders Agreement invalid.
The related dispute between Wynn Resorts and Okada over his redeemed shares is still scheduled to go to trial in April.
In its filing, Wynn Resorts added Mr Wynn had informed the company that he has no immediate plans to sell shares that he owns and that “if he elects to sell any such shares over time, he will seek to conduct such sales in an orderly fashion.”
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