Wynn Resorts shareholders: Elaine Wynn won't return to board

AP News
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Posted: Apr 24, 2015 4:23 PM

LAS VEGAS (AP) — Elaine Wynn failed Friday to win re-election to the board of Wynn Resort Ltd. — the casino-hotel company she co-founded with ex-husband Steve Wynn — a development that ended a feud over the issue.

Shareholders who had to decide between re-electing Elaine Wynn or agreeing with a company recommendation to re-elect two other sitting board members ultimately sided with the company.

Wynn Resorts general counsel Kim Sinatra announced the results at the company's annual meeting minutes after a handful of remaining votes were collected from some of the 141 shareholders in attendance at the Encore Theater inside the Las Vegas resort.

Sinatra said shareholders affirmed the company's recommendation to re-elect board members John J. Hagenbuch and J. Edward Virtue. The outcome shrinks the board from eight members to seven.

"While I am certainly disappointed by the result of today's vote, I am hopeful that I have once again served as an agent for change and improvement for this company, which I love so deeply," Elaine Wynn said in a statement after the meeting.

She previously said the opposition to her re-election and her subsequent fight to remain a member marked a referendum on her life's work.

Shareholder Ellyce Rumick, who traveled from Chicago for the meeting, drew scattered applause during a question-and-answer session, when she told Steve Wynn that she was upset by the removal of Elaine Wynn.

"You're the beginning of this creativity," shareholder Rumick said of the move by the couple to form Wynn Resorts. "And you don't just oust someone from the board."

"Is that a question?" Steve Wynn, CEO, chairman and co-founder, replied after Rumick said Elaine Wynn should remain on the board.

"It's a suggestion," Rumick replied.

After the meeting, 67-year-old shareholder Larry Clayton of Las Vegas said he was in favor of Elaine Wynn remaining on the board but didn't get her proxy card in the mail to vote for her.

"Trying to blame her for all the problems is wrong," he said.

The two sides traded accusations and defenses in the proxy fight that lasted more than a month, eventually putting Steve Wynn awkwardly in the middle.

He offered no comments about the vote during the meeting.

Company spokesman Michael Weaver said a tally of votes would not be available until an auditor certified the count.

Weaver confirmed that Steve Wynn, the company's second-largest shareholder, cast his vote for Elaine Wynn as required by a shareholder agreement between the two.

The agreement is the subject of a lawsuit filed by Elaine Wynn against her ex-husband in an effort to void it.

The board pointed to the lawsuit as a primary reason for not re-electing Elaine Wynn, explaining that if she prevailed, it would allow her to sell or gift any of her 9.4 percent stake in the company.

Elaine Wynn is the company's third-largest shareholder. The company's independent board members have voiced concerns that a possible court decision in her favor could trigger a requirement the company buy a significant amount of its outstanding debt.

For that reason, the company argued that Elaine Wynn's interests as a board member weren't aligned with the rest of the stockholders.

Elaine Wynn had described the lawsuit as a disagreement with Steve Wynn, separate and apart from her duties as a board member.

As the only woman on the board until now, she also argued that the attempt to remove her would be a symbolic misstep and bad business, showing an "appalling lack of diversity."

The company has said the board will seek an additional independent director to replace Elaine Wynn and keep diversity in mind when doing so.