LAS VEGAS (dpa-AFX) - Wynn Resorts Limited (WYNN) agreed to pay a total of $2.6 billion to settle a lawsuit with Universal Entertainment Corp. over the forced redemption of the Japanese pachinko-machine maker's 20 percent stake in the casino operator six years ago.
Buckley Sandler LLP represented Universal Entertainment Corporation and its subsidiary Aruze USA, Inc. in securing a $2.632 billion settlement that resolves a six-year lawsuit against Wynn Resorts, Limited. The settlement announced today will resolve all claims between Wynn Resorts, Universal, and Aruze.
Buckley Sandler noted that the litigation stems from Universal and Aruze's challenge to Wynn Resorts' February 2012 forced redemption of 24.5 million shares of Wynn Resorts common stock held by Aruze, over alleged violations of the Foreign Corrupt Practices Act. Wynn Resorts purported to redeem those shares at a 30% discount to the stock's trading price at the time, payable by a 10-year promissory note with a face value of roughly $1.9 billion and bearing a 2% interest rate. Under the settlement, Wynn Resorts will pay a total of $2.632 billion by March 31.
Wynn Resorts confirmed that it has concluded a settlement agreement with Universal Entertainment Corporation and Aruze USA, Inc. regarding litigation between the parties which began in February 2012 and was related to the redemption of Aruze USA's equity stake in the Company. The settlement provides for the parties to the agreement to dismiss all litigation between Universal Entertainment and Aruze USA, and Wynn Resorts, its then-directors and executives with respect to the redemption. The settlement agreement also puts an end to claims brought by Universal Entertainment and Aruze USA against Wynn Macau in Macau.
The settlement agreement, which is effective today, provides for Wynn Resorts to pay, on March 31, 2018, the $1.94 billion principal amount of the redemption note that the Company previously issued to Aruze. Wynn Resorts also agreed to pay an additional amount of $463.56 million on March 31, 2018, to settle allegations surrounding the interest rate on the redemption note.
Among other items, the settlement agreement provides that Aruze USA, will not consider itself a party to the Amended and Restated Stockholders Agreement among Universal Entertainment's subsidiary Aruze USA, Steve Wynn and Elaine P. Wynn, nor will it assert any claims or rights under the Stockholders Agreement. The settlement agreement also provides for the parties to release one another from all claims related to the redemption and to cooperate with each other in any litigation that may arise from the settlement agreement or previous litigation.
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