Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
On July 29, 2020, MGM Resorts International (the "Company") announced that
Acting Chief Executive Officer and President William J. Hornbuckle has been
elected as Chief Executive Officer and President, effective July 29, 2020. In
addition, on July 29, 2020, the Board of Directors (the "Board") appointed
Mr. Hornbuckle to serve as a member of the Board until the Company's next annual
meeting or until a successor is elected and qualified. Mr. Hornbuckle will not
receive any compensation in connection with his service on the Board.
Mr. Hornbuckle, age 62, has served as Acting Chief Executive Officer and
President since March 22, 2020. Prior to that, he served as President and Chief
Operating Officer of the Company since 2012 and 2019, respectively.
Mr. Hornbuckle served as Chief Marketing Officer of the Company from 2009 until
2014. From 2005 until August 2009, Mr. Hornbuckle served as President and Chief
Operating Officer of Mandalay Bay Resort & Casino and previously served as
President and Chief Operating Officer of MGM Resorts International-Europe, where
he worked on the development of the Company's gaming operations in the United
Kingdom. Mr. Hornbuckle also served as President and Chief Operating Officer of
MGM Grand Las Vegas from 1998 to 2001. Mr. Hornbuckle has no family
relationships with any of our directors or executive officers and there are no
transactions in which Mr. Hornbuckle has an interest in that would require
disclosure under Item 404(a) of Regulation S-K.
In connection with Mr. Hornbuckle's election as Chief Executive Officer and
President, the Company entered into a new employment agreement with
Mr. Hornbuckle, effective as of July 29, 2020 (the "Agreement"). The Agreement
provides for a term until March 31, 2024 and a minimum base salary, effective
January 1, 2021, of $1,500,000 per year. Until January 1, 2021, Mr. Hornbuckle
will be compensated based on his existing salary of $1,100,000, which he had
previously elected to take in the form of restricted stock units.
Beginning with any bonus payable in respect of services performed for fiscal
year 2021, the Agreement provides for an annual target bonus equal to 175% of
Mr. Hornbuckle's base salary up to a maximum of 175% of his target bonus,
provided that any amounts paid in excess of Mr. Hornbuckle's target bonus will
be paid in fully vested deferred restricted stock units payable in 25%
installments over the 4-year period following the grant date (and subject to
acceleration in the event Mr. Hornbuckle's employment with the Company is
terminated for any reason).
The Agreement also provides that, subject to the discretion of the Compensation
Committee of the Board, Mr. Hornbuckle will be eligible for annual equity grants
in 2020, 2021, 2022 and 2023 with an expected grant date accounting value of
$8,000,000, which are expected to be provided 60% in the form of performance
share units and 40% in the form of restricted stock units. The Agreement further
provides Mr. Hornbuckle with certain other benefits and perquisites, which are
discussed in detail in the Agreement.
In the event of a termination of Mr. Hornbuckle's employment as the result of
his death or a termination by the Company due to disability, the Company will
pay Mr. Hornbuckle one year of salary payable at regular payroll intervals (less
any payments received from an employer-paid short term disability policy).
In the event of a termination by the Company for no cause or by Mr. Hornbuckle
for good cause prior to the end of the term of the Agreement, Mr. Hornbuckle
will receive the lesser of (A) two times (i) his annual base salary as in effect
on January 1, 2021 (regardless of when such termination occurs) and (ii) his
target bonus and (B) the number that results from dividing the number of days
remaining through the end of his term (following the date of termination) by
365, times (i) his annual base salary as in effect on January 1, 2021
(regardless of when such termination occurs) and (ii) his target bonus, in each
case, payable in 12 monthly installments. Any such severance payments will be
subject to applicable taxes and Mr. Hornbuckle's execution and non-revocation of
a general release of claims.
The Agreement provides that, to the extent required by the Coronavirus Aid,
Relief, and Economic Security Act (the "CARES" Act), in connection with the
Company becoming eligible for or entering into a loan, loan guarantee or other
form of financial assistance from a governmental entity, Mr. Hornbuckle will
agree to such limitations or reductions with respect to compensation and
severance pay as may be required to comply with the CARES Act.
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The foregoing description is not a complete description of the Agreement and is
qualified in its entirety by reference to the full text of the Agreement, a copy
of which is attached hereto as Exhibit 10.1and incorporated by reference in this
Item 5.02.
Item 9.01 Financial Statements and Exhibits
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Exhibits
Exhibit
No. Description
10.1 Employment Agreement, effective as of July 29, 2020, by and between
the Company and William Hornbuckle.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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