Las Vegas Sun

March 28, 2024

MGM Mirage execs saw pay cut as economy declined

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Jim Murren

Beyond the Sun

Top MGM Mirage executives were paid less in 2008 as the company's financial results deteriorated, a company filing showed today.

Former Chairman and Chief Executive Terry Lanni was paid $3.814 million last year, down from $12.74 million in 2007 and $15.687 million in 2006; while Jim Murren has seen his pay fall from $10.32 million in 2006 to $8.468 million in 2007 to $3.066 million last year, the filing showed.

Murren took over as chairman and chief executive on Dec. 1. He's also the company's chief operating officer and president.

Murren, who received a $500,000 raise as CEO and now has a base salary of $2 million, is eligible for bonuses of up to $4.25 million this year.

In 2006, 2007 and 2008 his base salary was $1.5 million and he and other executives made extra money by receiving stock awards, stock appreciation rights, stock option awards and incentive payments.

The company determined there would be no incentive payments for 2008 based on its financial performance. In 2008, the company lost $855 million compared to a profit in 2007 of $1.584 billion and $648 million earned in 2006.

The MGM Mirage executive pay plan is similar to that of other Fortune 500 companies and its salary levels reflect, in part, a goal of being competitive with what other companies in the gaming and hotel industries pay.

MGM Mirage said the objectives of its compensation plan are to:

• Attract talented and experienced executives and retain their services on a long-term basis

• Motivate the executives to achieve annual and long-term strategic goals

• Align the interests of the executives with the interests of the company and the interests of the stockholders

• Provide "a minimum level of compensation" while providing for a majority of the potential compensation to be dependent on the level of company financial performance

• Motivate and reward the executives in connection with ongoing management of development projects

• Motivate and reward the executives in connection with negotiations of strategic partnerships

• Through incentive awards based on yearly performance as well as equity awards that vest over a period of time, encourage executives to balance the management of long-terms risks and long-term performance with yearly performance

• Ensure favorable tax treatment for the company for such compensation

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