Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
On January 6, 2021, MGM Resorts International (the "Company") announced that the
Board of Directors had appointed Jonathan Halkyard to serve as Chief Financial
Officer and Treasurer of the Company, effective January 11, 2021, replacing
Corey Sanders who had been appointed to the role of Chief Operating Officer on
December 4, 2020.
Previously, Mr. Halkyard, age 56, served as President and Chief Executive
Officer of Extended Stay America, Inc. ("Extended Stay") and its paired-share
REIT, ESH Hospitality, Inc., from January 2018 through November 2019, as Chief
Financial Officer of Extended Stay from January 2015 through December 2017 and
as Chief Operating Officer of Extended Stay from September 2013 through January
2015. Prior to joining Extended Stay, Mr. Halkyard served as Chief Financial
Officer of NV Energy, Inc. from July 2012 through September 2013 and, prior to
that, he served in various executive, finance and managerial roles at Caesars
Entertainment Inc. since 1999, including as Chief Financial Officer from 2006
through 2012. Mr. Halkyard is also a director of Dave & Buster's Entertainment
(NASDAQ: PLAY), a director of Shift4 Payments, Inc. (NYSE: FOUR) and is a
Trustee of the International Center for Responsible Gaming. Mr. Halkyard has no
family relationships with any of our directors or executive officers and there
are no transactions in which Mr. Halkyard has an interest in that would require
disclosure under Item 404(a) of Regulation S-K.
In connection with his appointment, Mr. Halkyard entered into an employment
agreement with the Company, effective as of January 11, 2021 (the "Employment
Agreement"), which provides for a term until January 10, 2024 and a minimum base
salary of $900,000 per year. In addition, the employment agreement provides for
an annual target bonus equal to 150% of Mr. Halkyard's base salary, and certain
other benefits and perquisites, which are discussed in detail in the Employment
Agreement. In the event of a termination of Mr. Halkyard's employment as the
result of his death or a termination by the Company due to disability, the
Company will pay Halkyard one year of salary payable at regular payroll
intervals (less any payments received from an employer-paid short term
disability policy).
The Employment Agreement also provides that Mr. Halkyard will be eligible for
annual equity grants from the Company. As part of the annual equity award for
2021, Mr. Halkyard will be granted an award of restricted stock units with an
accounting value of $900,000 on the first business day of the month succeeding
his employment with the Company, which will vest in four equal annual
installments on the first four anniversaries following the grant date.
In the event of a termination by the Company for no cause or by Mr. Halkyard for
good cause prior to the end of the term of the Employment Agreement,
Mr. Halkyard will receive (i) an amount equal to his annual base salary plus his
target bonus amount, payable in 12 monthly installments; (ii) any earned but
unpaid discretionary bonus due to him; and (iii) a payment equal to 1.5 times
the cost of COBRA for a coverage period of 12 months, payable in 12 monthly
installments. If the Company terminates Mr. Halkyard for no cause after the end
of the term of the Employment Agreement (at which time he would be treated as an
at-will employee of the Company), Mr. Halkyard will receive a lump sum payment
equal to one year of his base salary. Any such severance payments will be
subject to applicable taxes and Mr. Halkyard's execution and non-revocation of a
general release of claims.
The Employment Agreement also contains a non-compete covenant generally
prohibiting Mr. Halkyard from providing services to a competitor or soliciting
employees or business contacts for 12 months following his termination of
employment or for 12 months following the term of the Employment Agreement. In
addition, the Employment Agreement mandates that Mr. Halkyard's confidentiality
obligations continue even after his termination of employment.
The Employment Agreement provides that, to the extent required by 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. Halkyard 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 Employment
Agreement and is qualified in its entirety by reference to the full text of the
Employment Agreement, a copy of which is attached hereto as Exhibit 10.1, which
is 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 January 11, 2021, by and
between the Company and Jonathan Halkyard
99.1 Press Release
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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