EXHIBIT 10(26)
April 13, 1995
Mr. J. Xxxxxxxx Xxxxx
c/o Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Dear Xxxxx:
This letter will memorialize the agreement between yourself and MGM Grand, Inc.
("MGMG"):
1. Commencement Date:
As soon as practicable, but not later than June 1, 1995.
2. Positions/Titles:
A. President and Chief Executive Officer
B. Member of the Board of Directors
C. Member of the Executive Committee
3. Compensation
A. Base: $1,000,000 per year, subject to possible increase following annual
----
review on the employment anniversary date at the sole discretion of
MGMG's Compensation Committee.
B. Stock Options: 1,000,000 shares of MGMG common stock and subject to the
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following vesting schedule:
End of Employment Percentage of
Year Options Vesting
----------------- ---------------
1 0
2 0
3 20
4 20
5 20
6 40
Mr. J. Xxxxxxxx Xxxxx
April 13, 1995
Page 2
The options will be granted pursuant to an amendment to MGMG's
existing Nonqualified Stock Option Plan or pursuant to a new
Nonqualified Stock Option Plan, and will be subject to stockholder
approval.
C. Acceleration of Stock Options: If there is a change in control of MGMG
------------------------------
as the result of stockholders disposing of their shares through sale
or exchange to a third party or cash merger (as distinguished from a
change of control resulting from the issuance of treasury shares or
from any other transaction) before the stock options are fully vested,
all unvested stock options shall become fully vested as of the date of
such sale, exchange or cash merger.
4. Duties and Responsibilities: Those consistent with Positions/Titles.
5. Exclusivity: You agree to devote your full business time to MGMG and to
render your services solely and exclusively for MGMG, provided that the
Executive Committee may in its sole discretion grant exceptions to such
exclusivity, which exceptions may be withdrawn in the sole discretion of
such Committee. Subject to the above-referenced discretion of the Executive
Committee, it is understood that you will continue to serve as Chairman of
the Board of Trustees of Loyola Marymount University and as a director of
Santa Xxxxx Operating Company and of Santa Xxxxx Realty Enterprises.
6. Representations and Warranties: You represent and warrant that:
A. You can and will be unconditionally licensed by all applicable Gaming
Authorities, and other authorities, including authorities to which
MGMG may become subject in the future. Notwithstanding the foregoing,
this provision shall not be deemed to have been violated if the sole
reason you are not licensed by any future authority is your failure to
comply with any licensing requirement that you become a resident of
such jurisdiction.
B. There are no currently existing conditions which may impair your
ability to perform your duties hereunder.
C. You have the full right to enter into this agreement, and your
entering into this agreement will not violate or conflict with any
arrangements you have with anyone.
Mr. J. Xxxxxxxx Xxxxx
April 13, 1995
Page 3
7. Termination Right: Except as otherwise provided in Paragraph 8 below,
either party shall have the right to terminate this agreement and your
employment hereunder on thirty (30) days notice without any further
obligations to each other, including without limitation any obligations
under Paragraph 3 above.
8. Termination Without Cause: If your employment is terminated without cause at
any time during the first five years of the agreement:
A. You shall be entitled to continue receiving your base compensation set
forth in Paragraph 3A on a monthly basis for the number of months shown
in the following schedule, less any earned income and employee
benefits received by you by virtue of your employment elsewhere during
such payout period:
If Termination Without Number of Months Base
Cause Occurs in Year: Compensation
---------------------- (payout period)
---------------------
1 18 months
2 18 months
3 12 months
4 6 months
5 6 months
B. For purposes of this agreement, the term "cause" shall mean:
(1) Misconduct or negligence in the performance of your material
duties hereunder, or refusal to perform such duties;
(2) Any breach of your representations, warranties and covenants
contained in this agreement;
(3) Failure by you to promptly obtain or retain any permits, licenses,
or approvals which shall be required by any State or local
authorities for the conduct of any business activities of MGMG,
provided however that "cause" shall not be deemed to exist if the
sole reason you fail to obtain or retain any such permits,
licenses or approvals is your non-residence in a jurisdiction
other than Nevada;
Mr. J. Xxxxxxxx Xxxxx
April 13, 1995
Page 4
(4) Your death, or your disability for a consecutive period of six (6)
months;
(5) Your indictment for or conviction of a crime, except for minor
traffic violations and similar matters, it being acknowledged
that inasmuch as the activities of MGMG and its subsidiaries are
subject to a high degree of regulation and require MGMG to
maintain the highest standards of integrity, any such indictments
or convictions would be material and adverse to the interests
of MGMG; or
(6) The Board of Directors shall, after reasonable inquiry, have
reasonably concluded that you have engaged in conduct which is
materially adverse to MGMG or its business reputation.
9. Employee Benefits: You shall be entitled to all employee benefits that are
in place as of the Commencement Date of this agreement, subject to change
from time to time at the discretion of the Executive Committee or
Compensation Committee. It is understood and acknowledged that MGMG is not
committing to maintain any particular level of benefits or benefits
program, provided however, that your level of participation in such
programs shall be at the same level as those afforded to the group of
senior executives of MGMG.
10. Relocation Expenses: MGMG will pay the cost of your relocation from Los
Angeles to Las Vegas in accordance with MGMG's standard "Los Angeles/Las
Vegas Relocation Policy - Officers", of which you have been supplied a copy.
11. Confidentiality: The terms of this agreement shall be kept confidential,
subject to MGMG's compliance with applicable federal and state laws and
regulations which may require public disclosure of the agreement or its
terms.
Mr. J. Xxxxxxxx Xxxxx
April 13, 1995
Page 5
12. Public Announcement: MGMG shall have the right to issue a press release
concerning your engagement by MGMG, provided the text of such press release
shall be subject to your approval, not to be unreasonably withheld. You
and MGMG each covenant not to, or to permit your respective agents or
representative to, leak word of this agreement prior to issuance of the
press release.
Sincerely,
MGM Grand, Inc.
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Xxxxxx X. Xxxxx,
Chairman
AGREED TO AND ACKNOWLEDGED:
/s/ J. XXXXXXXX XXXXX April 14, 1995
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J. Xxxxxxxx Xxxxx Date
/s/ XXXX XXXXXXXXXXX April 14, 1995
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Xxxx Xxxxxxxxxxx Date
