May 18, 2012 – Jane Doe files for divorce from John Doe, claiming allegations of cheating. Might seem routine. Except for when the Jane Doe and John Doe were revealed to be Sue Ann Hamm and Harold Hamm, the founder, chairmen, and CEO of the multi-billion oil and gas company Continental Resources, Inc.
Large Amounts of $$$ at Stake
The divorce, being worked out now, with nearly $17 billion at stake, could go down as the most expensive and financially complex divorces in U.S. history. Most of the wealth was accumulated during the couple’s 26 years of marriage.
Sue Ann Hamm is a former lawyer for Continental. Harold Hamm owns two thirds of the company’s stock. If she wins what she is seeking – somewhere between 3 and 6 billion – she would instantly become one of the richest women – in the world.
While most divorce trials last a day or two, this one has already breached its fourth week (of an estimated nine). The case has raised questions regarding information a publicly traded company should be forced to disclose when one of its leaders goes through a divorce. According to legal experts, while the couples personal and professional history play a part in the decision, so does the price of Continental’s stock.
According to financial and legal analysts, a $3 billion award to Sue Ann Hamm would likely mean Harold Hamm would need to sell a large amount of his own company stock to be able to cover the judgment. As a result of this, Harold Hamm would no longer be the largest stock holder in the company.
“You can make a strong argument that because the future control of the company is in jeopardy because of this divorce, it should have been disclosed,” said Toby Galloway, partner at Kelly Hart & Hallman.
No Prenuptial Agreement
While the couple did not sign a prenuptial agreement, under Oklahoma law, Harold Hamm is allowed to keep everything he had during the time of the couple’s marriage. This includes 122 million shares of Continental stock. But according to family law lawyers familiar with Oklahoma law, Sue Hamm has a legal claim to any increases in the value of stock or any other assets if her actions during the past 26 years contributed to those increases.
Source: Dallas Morning News, Could a CEO’s divorce materially affect a company’s future? September 1, 2014
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