SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934 (Amendment
No. __)
Filed by the Registrant [ ]
Filed by a Party other than the Registrant
[x]
Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
[X] |
Definitive Additional Materials |
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Soliciting Material Under Rule 14a-12 |
MGM Resorts International
(Name of Registrant as Specified In Its Charter)
Land & Buildings Investment Management,
LLC
Land & Buildings Capital Growth Fund,
L.P.
Jonathan Litt
Matthew J. Hart
Richard Kincaid
Marc A. Weisman
(Name of Person(s) Filing Proxy Statement, if
other than the Registrant)
Payment of Filing Fee (check the appropriate
box):
[X] |
No fee required. |
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Fee computed on table below per Exchange Act Rule 14a-6(i)(4) and 0-11. |
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act |
Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
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Fee paid previously with preliminary materials. |
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the |
filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
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LAND AND BUILDINGS JOINS MGM SHAREHOLDER IN
CALLING FOR MGM TO ELIMINATE DEAD HAND PROXY PUT ENTRENCHMENT DEVICE
| - | In response to shareholder lawsuit MGM
has repeatedly claimed they will take action, but instead continues to drag its feet on key fiduciary issue – |
| - | In our view, blatant entrenchment mechanism
is only the latest proof of need for revamped board stewardship and refreshed board at MGM – |
Stamford, CT— (April 27, 2015) – Today Land and
Buildings Investment Management LLC (“Land and Buildings”), is calling on MGM Resorts International (NYSE:MGM) (“MGM”
or the “Company”) to eliminate its Dead Hand Proxy Put provision in the Company’s debt agreement with a syndicate
of lenders, including Bank of America, N.A. as Administrative Agent, dated as of December 20, 2012 (the "Debt Agreement").
MGM is facing a lawsuit from one of its shareholders, the Pontiac General Employees Retirement System (“Pontiac General”),
demanding MGM take this action, and in spite of repeated empty promises, has failed to do so.
Jonathan Litt, Founder and CIO of Land and Buildings, commented,
“This egregious governance decision is only the latest in an increasingly damning body of evidence that make one thing abundantly
clear: improved stewardship and a refreshed Board are urgently needed at MGM. The fact that the Company’s Board would potentially
coerce shareholders into voting for their incumbent nominees in this fashion, in our view, represents a complete and utter lack
of respect for the shareholder franchise and a blatant example of entrenchment. We believe the fact that MGM has taken this long
to address this issue, in spite of strong calls from shareholders to take action, reinforces that this is a board and management
team that, as currently constructed, simply can’t be trusted to act in the best interest of shareholders.”
The Proxy Put is a provision in the Company’s Debt Agreement
that states, if a majority of the Board is replaced from an actual or threatened proxy contest or consent solicitation within a
24-month period, it would be considered an “event of default” and the debt could be immediately required to be pre-paid
in full. As the Company has noted, in the event it defaults under the Debt Agreement, it "could trigger cross defaults under
other agreements governing our long-term indebtedness. Any default under our senior secured credit facility or the indentures governing
our other debt could adversely affect our growth, our financial condition, our results of operations and our ability to make payments
on our debt.”
The Pontiac General suit notes that "MGM also has issued and
outstanding numerous notes and convertible notes, totaling billions of dollars. More than one dozen of these series of notes have
cross-default provisions that are triggered by defaults in other loans or notes at levels substantially below the amount outstanding
under the Debt Agreement."
The Delaware Chancery Court has repeatedly criticized proxy puts,
noting that they “highlight the troubling reality that corporations and their counsel routinely negotiate contract
terms that may, in some
circumstances, impinge on the free exercise of the stockholder franchise.”
San Antonio Fire & Police Pension Fund v. Amylin Pharmaceuticals, Inc., 983 A.2d 304, 319 (Del. Ch. 2009) (emphasis
added). Proxy puts function to dampen shareholder choice because, “there are few events which have the potential to be more
catastrophic for a corporation than the triggering of an event of default under one of its debt agreements.” Id.
Pontiac General asserts in its suit that "[t]he Board breached
their fiduciary duties by approving and maintaining the Dead Hand Proxy Put, which serves no identifiable purpose other than to
entrench the incumbent Board." Land and Buildings agrees that the only purpose served by the Dead Hand Proxy Put is to entrench
the current MGM Board, which serves to further disenfranchise MGM shareholders.
Pontiac General filed suit against MGM in October 2014. While MGM
has expressed repeatedly to the shareholder that further legal action was unnecessary because MGM would act properly and remove
the entrenchment device, MGM has not done so. Indeed, frustrated by MGM's failure to act, Pontiac General recently advised the
Delaware Chancery Court that, “If the Dead Hand Proxy Put in the Debt Agreement is not eliminated by April 29, 2015, we will
move with alacrity to press our claims so that the incumbents derive no electoral advantage from the threat of potential debt acceleration.”
About Land and Buildings:
Land and Buildings is a registered investment manager specializing
in publicly traded real estate and real estate related securities. Land and Buildings seeks to deliver attractive risk adjusted
returns by opportunistically investing in securities of global real estate and real estate related companies, leveraging its investment
professionals' deep experience, research expertise and industry relationships.
Investor Contact:
Scott Winter / Jonathan Salzberger
Innisfree M&A Incorporated
212-750-5833
Media Contact:
Elliot Sloane / Dan Zacchei
Sloane & Company
212-486-9500
Esloane@sloanepr.com or
Dzacchei@sloanepr.com
LAND & BUILDINGS CAPITAL GROWTH FUND, L.P., LAND &
BUILDINGS INVESTMENT MANAGEMENT, LLC AND JONATHAN LITT (COLLECTIVELY, "LAND & BUILDINGS") AND MATTHEW J. HART, RICHARD
KINCAID AND MARC A. WEISMAN (TOGETHER WITH LAND & BUILDINGS, THE "PARTICIPANTS") FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION (THE "SEC") ON APRIL 16, 2015 A DEFINITIVE PROXY STATEMENT AND ACCOMPANYING FORM OF PROXY CARD TO BE USED
IN CONNECTION WITH THE PARTICIPANTS' SOLICITATION OF PROXIES FROM THE STOCKHOLDERS OF MGM RESORTS INTERNATIONAL (THE "COMPANY")
FOR USE AT THE COMPANY'S 2015 ANNUAL MEETING OF STOCKHOLDERS (THE "PROXY SOLICITATION"). ALL STOCKHOLDERS OF THE COMPANY
ARE ADVISED TO READ THE DEFINITIVE PROXY STATEMENT AND OTHER DOCUMENTS RELATED TO THE PROXY SOLICITATION BECAUSE THEY CONTAIN IMPORTANT
INFORMATION, INCLUDING ADDITIONAL INFORMATION RELATED TO THE PARTICIPANTS. THE DEFINITIVE PROXY STATEMENT AND AN ACCOMPANYING PROXY
CARD HAVE BEEN FURNISHED TO SOME OR ALL OF THE COMPANY'S STOCKHOLDERS AND ARE, ALONG WITH OTHER RELEVANT DOCUMENTS, AVAILABLE AT
NO CHARGE ON THE SEC'S WEBSITE AT HTTP://WWW.SEC.GOV/. IN ADDITION, INNISFREE M&A INCORPORATED,
LAND & BUILDING'S PROXY SOLICITOR, WILL PROVIDE COPIES OF THE DEFINITIVE PROXY STATEMENT AND ACCOMPANYING PROXY CARD WITHOUT
CHARGE UPON REQUEST.
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