It is a tough time for hotels and resorts, casinos included. This means that revenues and income are down. According to WSJ, MGM Resort International (NYSE:MGM) reported a 91% revenue decline. On this news shares of MGM went more than 3% down.
But just because MGM Resort said that ‘large majority’ of employees in the entertainment, sports division will be fired, this doesn’t mean that these aren’t the golden times for some employees.
After the Friday trading session on New York Sock Exchange finished, MGM reported via SEC filing that they elected a new CEO and President. Actually the new CEO is exactly the same as the old one, and his name is William J. Hornbuckle.
Acting CEO became a new CEO but there is a slight change in his employment agreement.
In connection with Mr. Hornbuckle’s election as CEO and President MGM entered into a new employment agreement with Mr. Hornbuckle, effective as of July 29, 2020 . This 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 1st Mr. Hornbuckle will be compensated based on his existing salary of $1,100,000.
On top of this salary Mr. Hornbuckle will be eligible for a Bonus, with a target bonus amount equal to 175% of Employee’s base salary which is some $2,600,000 payable in RSUs (restricted stock units).
But that is not all because Mr. Hornbuckle will Mr. be eligible for annual equity grants during those 4 years with an expected grant date accounting value of $8,000,000, which are expected to be provided 60% in the form of PSUs and 40% in the form of restricted stock units.
Mr. Hornbuckle’s base salary may go down if MGM enters into a government loan deal (under the CARES act) and if such action is required by this deal.