Posted in: Sports, TV, WWE | Tagged: Vince McMahon, wrestling, wwe

Vince McMahon Tightens Grip on Power in WWE with New SEC Filing

Vince McMahon has achieved "substantial alignment" with the WWE board (read: dissenters have been ousted), so stockholder approval is no longer required.

When Vince McMahon forced his way back into power at WWE, his rationale was that the company required his leadership to make the best decisions on behalf of stockholders in initiating a strategic review process ahead of the renegotiation of the company's media rights deals, set to take place in the Fall. McMahon was forced to retire last year over sexual misconduct accusations and investigations into hush money payments to the accusers, but he returned with a vengeance to kick off 2023, using his majority stockholder voting power to elect himself Chairman, effectively oust his detractors and initiate a sale of the company. To do so, McMahon used a Written Consent to amend company bylaws, replace several members of the board with himself and loyalists (also seeing three other members of the board resign), and get himself elected Chairman unanimously by the remaining board members.

Mission accomplished, McMahon has announced the repeal of the changes to the company bylaws, replacing them with a new decree: "no further approval of the stockholders of the Company is required to approve any of the actions taken by Mr. McMahon." According to a new SEC filing, now that the board, company management, and McMahon, who holds 81% of voting power due to his stock ownership, have achieved "substantial alignment" (read: everyone who disagreed is now gone), those changes to empower stockholders (read: McMahon) are no longer necessary.

(Seen above, Emperor Palpatine achieves "substantial alignment" with the Jedi Order during Star Wars: Revenge of the Sith.)

What does this actually change? Not much. In fact, since McMahon issued his first Written Consent on January 5th, the board has proven powerless to prevent him from doing whatever he wanted, and now that is further codified in company bylaws. It's unknown whether a recent class action lawsuit filed against McMahon on behalf of stockholders had any impact on the new announcement.

You can read the full text of the introductory note explaining the changes below, as well as read through the entire filing here and a related one here. All SEC filings are published on WWE's corporate website.

On January 5, 2023, Vincent K. McMahon, the controlling stockholder of World Wrestling Entertainment, Inc. (the "Company"), executed and delivered a written consent (the "January 5th Consent") taking certain actions by consent without a meeting in accordance with Section 228 of the General Corporation Law of the State of Delaware (the "DGCL") resulting in, among other things, the election of Mr. McMahon to the Board of Directors of the Company (the "Board") and certain amendments to the Company's bylaws (the "January 5th Amendments") that Mr. McMahon indicated were intended to ensure that the Company's corporate governance continued to properly enable and support stockholder rights. On January 6, 2023, the Company issued a press release providing an update regarding the composition of its Board, including Mr. McMahon's return to the Board, and the Company's intention to explore strategic alternatives with the goal to maximize value for all stockholders of the Company. On January 9, 2023, the Board elected Mr. McMahon as Executive Chairman of the Board.

Subsequently, Mr. McMahon informed the Company of his view that there is substantial alignment among the Board and management concerning the decision to conduct a review of strategic alternatives amid the Company's upcoming media rights cycle and that the Company's corporate governance will properly enable and support stockholder rights. In light of the foregoing, on January 16, 2023, Mr. McMahon, in his capacity as controlling stockholder of the Company, executed and delivered a written consent (the "January 16th Consent") taking certain actions by consent without a meeting in accordance with Section 228 of the DGCL to substantially repeal the January 5th Amendments, as further described below in Item 5.03.

No further approval of the stockholders of the Company is required to approve any of the actions taken by Mr. McMahon pursuant to the January 16th Consent. Pursuant to rules adopted by the U.S. Securities and Exchange Commission (the "SEC") under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the Company expects to file with the SEC, and thereafter mail to its stockholders, an information statement as required by Schedule 14C promulgated under the Exchange Act to provide stockholders with information concerning the January 5th Consent and January 16th Consent. The Schedule 14C will also constitute notice to stockholders in accordance with Section 228 of the DGCL of the actions taken by the January 5th Consent and the January 16th Consent.

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