<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
MIRAGE RESORTS, INCORPORATED
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) 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):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / 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.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
MIRAGE RESORTS, INCORPORATED
--------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 23, 1996
----------------
The Annual Meeting of Stockholders (the "Meeting") of Mirage Resorts,
Incorporated (the "Company") will be held at The Mirage, 3400 Las Vegas
Boulevard South, Las Vegas, Nevada on Thursday, May 23, 1996, at 1:00 P.M., for
the following purposes:
1. To elect two directors for the term set forth in the accompanying Proxy
Statement;
2. To approve an amendment to the 1992 Non-Employee Director Stock Option
Plan; and
3. To transact such other business as may properly come before the Meeting
and any adjournments thereof.
Pursuant to the Bylaws of the Company, the Board of Directors has fixed the
time and date for the determination of stockholders entitled to notice of and to
vote at the Meeting as of the close of business on March 29, 1996. Accordingly,
only stockholders of record on such date and at such time will be entitled to
vote at the Meeting, notwithstanding any transfer of stock on the books of the
Company thereafter.
Whether or not you expect to attend the Meeting in person, please date and
sign the accompanying Proxy card and return it promptly to American Stock
Transfer & Trust Company in the envelope enclosed for that purpose.
KENNETH R. WYNN
SECRETARY
Las Vegas, Nevada
April 16, 1996
<PAGE>
MIRAGE RESORTS, INCORPORATED
3400 LAS VEGAS BOULEVARD SOUTH
LAS VEGAS, NEVADA 89109
APRIL 16, 1996
------------------
PROXY STATEMENT
The accompanying Proxy is solicited by and on behalf of the Board of
Directors of Mirage Resorts, Incorporated (the "Company") for use only at the
Company's Annual Meeting of Stockholders (the "Meeting") to be held on May 23,
1996, and at any and all adjournments thereof. Unless the accompanying Proxy has
been previously revoked, the shares represented by the Proxy will, unless
otherwise directed, be voted at the Meeting for the nominees for election as
directors named below, for approval of the amendment to the 1992 Non-Employee
Director Stock Option Plan (the "Director Plan") described below and, with
discretion, on all other matters as may properly come before the Meeting. A
stockholder may revoke the Proxy at will at any time prior to the voting of
shares by voting in person at the Meeting or by filing with the Secretary of the
Company a duly executed Proxy bearing a later date or an instrument revoking the
Proxy. The total cost of solicitation of Proxies will be paid by the Company.
In addition to soliciting Proxies by mail, the Company's officers, directors
and other regular employees, without additional compensation, may solicit
Proxies personally or by other appropriate means. It is anticipated that banks,
brokerage firms, fiduciaries and other custodians and nominees will forward
Proxy soliciting material to their principals and that the Company will
reimburse such persons' out-of-pocket expenses.
It is anticipated that this Proxy Statement and accompanying Proxy will
first be mailed to stockholders on or about April 22, 1996.
VOTING RIGHTS
Holders of the Company's common stock, $.008 par value (the "Common Stock"),
of record as of the close of business on March 29, 1996, will be entitled to one
vote for each share held on all matters presented to the Meeting. On March 29,
1996, there were outstanding 92,070,790 shares of Common Stock, which
constituted all of the outstanding voting securities of the Company. A majority
of the outstanding shares of Common Stock represented in person or by proxy will
constitute a quorum for the transaction of business at the Meeting. Abstentions
and broker non-votes will be counted as shares that are present for purposes of
determining the presence of a quorum. There will be no cumulative voting for
members of the Board of Directors. The two nominees who receive the greatest
number of votes cast will be elected to the Board of Directors. Approval of the
amendment to the Director Plan requires the affirmative vote of the holders of a
majority of the shares of Common Stock represented at the Meeting (giving effect
to abstentions but without giving effect to broker non-votes). Under the rules
of the New York Stock Exchange (the "NYSE"), the election of directors and
approval of the amendment to the Director Plan are considered by the NYSE to be
"routine" items upon which brokerage firms may vote in their discretion on
behalf of their customers if such customers have not furnished voting
instructions within a specified period prior to the Meeting.
<PAGE>
STOCK OWNERSHIP OF MAJOR STOCKHOLDERS AND MANAGEMENT
The following table sets forth certain information as of March 29, 1996 with
respect to the "beneficial" ownership, as such term is defined in the Rules of
the Securities and Exchange Commission (the "Commission"), of the Common Stock
by (i) each person who, to the knowledge of the Company, beneficially owned more
than 5% of the outstanding Common Stock, (ii) each director of the Company,
(iii) the Company's Chief Executive Officer and the four other highest
compensated executive officers of the Company during 1995 (collectively, the
"Named Officers") and (iv) all directors and executive officers of the Company
as a group.
<TABLE>
<CAPTION>
APPROXIMATE
PERCENTAGE OF
NUMBER OF OUTSTANDING
NAME SHARES COMMON STOCK
- ---------------------------------------- -------------- -------------
<S> <C> <C>
Stephen A. Wynn
P.O. Box 7777
Las Vegas, NV 89177 14,706,082(1) 15.0%
Melvin B. Wolzinger 1,724,870(2) 1.9%
Daniel B. Wayson 254,375(3) *
Elaine P. Wynn 117,500(4) *
George J. Mason 98,750(5) *
Richard D. Bronson -- --
Ronald M. Popeil 26,000(6) *
Barry A. Shier 375,105(7) *
Bruce A. Levin 60,000(8) *
Daniel R. Lee 372,000(9) *
Kenneth R. Wynn 583,441(10) *
All directors and executive officers
as a group (15 persons) 18,446,558(11) 18.6%
<FN>
- ------------------------
* Less than 1%.
(1) Includes 5,875,000 shares subject to options which are currently
exercisable or become exercisable within 60 days of March 29, 1996. Does
not include shares owned by Elaine P. Wynn, Mr. Wynn's wife, as separate
property, as to which shares Mr. Wynn disclaims beneficial ownership.
(2) Includes 1,507,693 shares held by a family trust of which Mr. Wolzinger and
his wife serve as trustees and 175,832 shares held by a limited partnership
of which such trust is the general partner and a limited partner. Mr.
Wolzinger disclaims beneficial ownership of 94,598 shares held by the
limited partnership as to which he has no pecuniary interest. Also includes
26,345 shares held by a trust of which Mr. Wolzinger serves as a trustee
but does not have any pecuniary interest, as to which shares Mr. Wolzinger
disclaims beneficial ownership. Also includes 15,000 shares subject to
options which are currently exercisable or become exercisable within 60
days of March 29, 1996.
(3) Includes 15,000 shares subject to options which are currently exercisable
or become exercisable within 60 days of March 29, 1996.
(4) Includes 15,000 shares subject to options which are currently exercisable
or become exercisable within 60 days of March 29, 1996. Does not include
shares reported as owned by Stephen A. Wynn, Mrs. Wynn's husband.
(5) Includes 50,000 shares held by a family trust of which Mr. Mason and his
wife serve as trustees and 15,000 shares subject to options which are
currently exercisable or become exercisable within 60 days of March 29,
1996.
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
(6) Includes 15,000 shares subject to options which are currently exercisable
or become exercisable within 60 days of March 29, 1996.
(7) Includes 375,000 shares subject to options which are currently exercisable
or become exercisable within 60 days of March 29, 1996 and 80 shares held
by Mr. Shier as custodian for his minor children.
(8) Includes 30,000 shares subject to options which are currently exercisable
or become exercisable within 60 days of March 29, 1996.
(9) Includes 370,000 shares subject to options which are currently exercisable
or become exercisable within 60 days of March 29, 1996.
(10) Includes 400,000 shares held by a family trust of which Mr. Wynn serves as
trustee and 1,250 shares held by Mr. Wynn as custodian for his minor
children. Mr. Wynn disclaims beneficial ownership of the shares held by him
as custodian. Also includes 182,191 shares subject to future vesting.
(11) Includes 6,845,000 shares subject to options which are currently
exercisable or become exercisable within 60 days of March 29, 1996.
</TABLE>
DIRECTORS AND EXECUTIVE OFFICERS
The Company's Articles of Incorporation and Bylaws provide for from three to
11 directors, the precise number to be determined from time to time by the Board
of Directors. Currently, the size of the Board is fixed at seven members. All of
the existing directors have been previously elected by the stockholders. The two
directors to be elected at the Meeting are to be elected to hold office for
three years each and until the election of their respective successors. All
Proxies received by the Board of Directors will be voted for the election, as
directors, of the nominees listed below if no direction to the contrary is
given. In the event that any nominee is unable or declines to serve, an event
that is not anticipated, the Proxies will be voted for the election of any
nominee who may be designated by the Board of Directors.
The information set forth below is submitted with respect to the nominees to
the Board for whom it is intended that Proxies will be voted, for directors
whose terms of office will continue after the Meeting and for executive officers
who are not directors.
INFORMATION CONCERNING NOMINEES FOR ELECTION AS DIRECTORS(1)
<TABLE>
<CAPTION>
YEAR FIRST
NAME ELECTED
- ------------------------------------------------------------------------------------------------ ----------------
<S> <C>
Elaine P. Wynn, 53(2) 1977
Director
Mrs. Wynn is active in civic and philanthropic affairs in the Las Vegas community and has been
so involved for more than five years. She is Secretary, Treasurer and a Trustee of Golden
Nugget Scholarship Fund, Inc.
Richard D. Bronson, 51 1993;
Director Appointed August
Mr. Bronson has been President of New City Development, a division of the Company which is 3, 1992
responsible for certain corporate development activities of the Company outside of Nevada, or
its predecessor, New City Development, Inc., since February 1992. He has also been President
of Bronson Companies, a real estate development and consulting firm in Hartford, Connecticut,
since October 1991, and from 1987 to July 1991 he was Co-Chairman of the Board of Bronson &
Hutensky, a real estate development firm in Hartford, and Monitor Management Corporation
("Monitor"), a real estate management firm in Hartford. On January 22, 1992, a creditor of Mr.
Bronson and Monitor filed an involuntary petition under Chapter 7 of the Bankruptcy Code
against Mr. Bronson. After attempts to negotiate an out-of-court settlement with Mr. Bronson's
creditors failed, the court entered an order for relief against Mr. Bronson and customary
discharge provisions on July 16, 1993. The discharge was completed in January 1995.
</TABLE>
3
<PAGE>
INFORMATION CONCERNING DIRECTORS WHOSE TERMS OF OFFICE WILL CONTINUE AFTER THE
ANNUAL MEETING(1)
<TABLE>
<CAPTION>
EXPIRATION
YEAR FIRST OF TERM AS
NAME ELECTED DIRECTOR
- ------------------------------------------------------------------------------ ---------------- ------------
<S> <C> <C>
Stephen A. Wynn, 54(2) 1973 1998
Chairman of the Board of Directors, President and Chief Executive Officer
Mr. Wynn has held his present positions for more than five years. He is also
a director of DMX Inc. ("DMX").
Ronald M. Popeil, 60 1980; Appointed 1998
Director and Member of Audit, Stock Option and Bonus Committees September 19,
Mr. Popeil has been the President of RONCO, Inc., the principal business of 1979
which is the production and marketing of consumer products, since he
co-founded that company in May 1984.
Melvin B. Wolzinger, 75 1973 1997
Director and Member of Audit, Stock Option and Bonus Committees
Mr. Wolzinger is, and has been for more than five years, a general partner
in W.W. Investment Co., a real estate holding company in Las Vegas, Nevada,
and is a principal owner of various restaurants and casino gaming
establishments in Las Vegas.
Daniel B. Wayson, 43 1988; Appointed 1997
Director March 19, 1987
Mr. Wayson is, and has been for more than five years, a principal of Wayson
Properties, Inc., a real estate development and holding company, and other
real estate and business ventures.
George J. Mason, 65 1973 1997
Director and Member of Audit, Stock Option and Bonus Committees
Mr. Mason is Senior Managing Director of, and Registered Representative for,
Bear, Stearns & Co. Inc., Los Angeles, California, an investment banking
firm which has provided certain services to the Company, and has been
employed by such firm for more than five years.
</TABLE>
INFORMATION CONCERNING EXECUTIVE OFFICERS OTHER THAN DIRECTORS LISTED ABOVE(3)
<TABLE>
<CAPTION>
YEAR HIRED
NAME BY COMPANY
- ------------------------------------------------------------------------------------------------------ ----------
<S> <C>
Barry A. Shier, 41, Executive Vice President -- Marketing and Hotel Operations 1984
Mr. Shier joined the Company as Executive Vice President -- Hotel Operations in September 1984 and
was appointed to his present position in August 1987. Since March 1991, he has also been the
President and Chief Executive Officer of GNLV, CORP., a wholly owned gaming subsidiary of the
Company.
Bruce A. Levin, 56, Vice President, General Counsel and Assistant Secretary 1979
Mr. Levin has been Vice President and General Counsel since joining the Company in August 1979. He
has also been Assistant Secretary since August 1979, except for the period August 1993 through July
1994, when he served as Secretary.
</TABLE>
4
<PAGE>
INFORMATION CONCERNING EXECUTIVE OFFICERS OTHER THAN DIRECTORS LISTED ABOVE(3)
(CONTINUED)
<TABLE>
<CAPTION>
YEAR HIRED
NAME BY COMPANY
- ------------------------------------------------------------------------------------------------------ ----------
<S> <C>
Daniel R. Lee, 39, Senior Vice President -- Finance and Development, Chief Financial Officer and 1992
Treasurer
Mr. Lee joined the Company as Senior Vice President -- Finance and Development in March 1992 and was
appointed Chief Financial Officer and Treasurer in September 1992. From March 1990 to March 1992, he
was a securities analyst and Director -- Equity Research of The First Boston Corporation, an
investment banking firm which has provided certain services to the Company.
Kenneth R. Wynn, 43, Vice President -- Design and Construction and Secretary (2) 1973
Mr. Wynn has held his present positions since joining the Company in August 1973, except for the
period August 1993 through July 1994. He has also been the President of Atlandia Design and
Furnishings, Inc., a wholly owned subsidiary of the Company which provides architectural, design,
purchasing and construction supervision services to the Company, for more than five years, and was a
director of the Company from 1973 to August 1993.
Frank P. Visconti, 42, Senior Vice President -- Retail Operations 1992
Mr. Visconti was appointed to his present position in September 1992. From June 1989 to September
1992, he was Vice President and General Manager of Neiman Marcus in San Francisco, California, a
retail specialty store.
Thomas L. Sheer, 58, Senior Vice President -- Government and External Affairs 1996
Mr. Sheer was appointed to his present position in January 1996. From November 1990 to December
1995, he was Assistant to the President of W. R. Grace & Co., a diversified chemicals company, and
he also served as Director of Business Intelligence of that company from July 1993 to December 1995.
James E. Pettis, 44, Vice President -- Risk Management 1980
Mr. Pettis was appointed to his present position in November 1984. He has been employed by the
Company since May 1980 with responsibility for various corporate risk management, safety and
employee benefit matters.
James M. Powers, 67, Vice President -- Corporate Security 1980
Mr. Powers has held his present position since joining the Company in January 1980.
<FN>
- ------------------------
(1) Only directorships of issuers with a class of securities registered
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), or subject to the requirements of Section 15(d) of the
1934 Act, or directorships of issuers registered as investment companies
under the Investment Company Act of 1940, as amended, are listed in the
table.
(2) Stephen A. Wynn and Elaine P. Wynn are husband and wife. Stephen A. Wynn
and Kenneth R. Wynn are brothers.
(3) Officers serve at the pleasure of the Board of Directors.
</TABLE>
5
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION AWARDS
COMPENSATION ------------------------------
------------------------------------------------ RESTRICTED SECURITIES
NAME AND PRINCIPAL OTHER ANNUAL STOCK UNDERLYING ALL OTHER
POSITION YEAR SALARY($) BONUS($) COMPENSATION($)(1) AWARDS($)(2) OPTIONS/SARS(#) COMPENSATION($)(3)
- ------------------------- ---- ---------- ---------- ------------------ ------------ --------------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Stephen A. Wynn 1995 $2,500,422 $1,250,000 $ 0 $ 0 1,000,000 $ 4,260
Chairman of the Board, 1994 2,501,701 1,250,000 0 0 0 4,260
President and Chief 1993 2,507,692 0 0 0 0 5,697
Executive Officer
Barry A. Shier 1995 1,000,000 375,000 0 0 1,000,000 4,260
Executive Vice President 1994 892,008 375,000 0 0 0 4,260
-- Marketing and Hotel 1993 750,000 250,000 0 0 0 5,697
Operations
Bruce A. Levin 1995 506,000 125,000 0 0 0 4,260
Vice President, General 1994 437,250 100,000 0 0 0 4,260
Counsel and Assistant 1993 406,000 0 0 0 0 5,457
Secretary
Daniel R. Lee 1995 400,000 200,000 0 0 0 4,008
Senior Vice President -- 1994 357,776 150,000 0 0 0 4,008
Finance and Development, 1993 302,692 100,000 0 0 0 5,217
Chief Financial Officer
and Treasurer
Kenneth R. Wynn 1995 379,556 125,000 0 0 250,000 4,008
Vice President -- Design 1994 350,352 100,000 0 0 0 3,882
and Construction and 1993 336,539 0 0 4,190,393 0 4,446
Secretary
<FN>
- ------------------------
(1) The Company provides certain perquisites and other personal benefits to
some or all of the Named Officers, including (i) reimbursement for medical
expenses, (ii) personal use of Company vehicles and aircraft, (iii)
complimentary rooms, food, beverages and entertainment (including
privileges at the Company's Shadow Creek golf course) and (iv) use of
Company employees to furnish personal services. The unreimbursed
incremental cost to the Company of providing perquisites and other personal
benefits did not exceed, as to any Named Officer for any year, the lesser
of $50,000 or 10% of the total salary and bonus paid to such Named Officer
for such year and, accordingly, is omitted from the table.
(2) At December 31, 1995, Kenneth R. Wynn held 182,191 restricted shares of
Common Stock with an aggregate value (based on the closing sale price of
the Common Stock on the NYSE Composite Tape on December 29, 1995) of
$6,285,590. To the extent that the Company pays dividends on the Common
Stock in the future, Mr. Wynn will receive dividends on such restricted
shares. None of the other Named Officers held restricted stock awards at
December 31, 1995.
(3) Represents (i) Company-paid premiums for term life insurance on each of the
Named Officers, as follows: Stephen A. Wynn -- 1995: $1,260, 1994: $1,260,
1993: $1,200; Barry A. Shier -- 1995: $1,260, 1994: $1,260, 1993: $1,200;
Bruce A. Levin -- 1995: $1,260, 1994: $1,260, 1993: $960; Daniel R. Lee --
1995: $1,008, 1994: $1,008, 1993: $720; and Kenneth R. Wynn -- 1995:
$1,008, 1994: $882, 1993: $840 and (ii) 50% matching contributions made by
the Company for the Named Officers in accordance with the Company's
retirement savings plan adopted pursuant to Section 401(k) of the Internal
Revenue Code of 1986, as amended (the "Code"), as follows: Messrs. Stephen
A. Wynn, Shier, Levin and Lee -- 1995: $3,000, 1994: $3,000, 1993: $4,497;
and Kenneth R. Wynn -- 1995: $3,000, 1994: $3,000, 1993: $3,606.
</TABLE>
6
<PAGE>
OPTION GRANTS IN 1995
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------------------------- POTENTIAL REALIZABLE VALUE
NUMBER OF AT ASSUMED ANNUAL RATES OF
SECURITIES % OF TOTAL OPTIONS STOCK PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM
OPTIONS EMPLOYEES IN PRICE EXPIRATION ----------------------------
NAME GRANTED (#) (1) 1995 ($/SH) (2) DATE (3) 5% ($) 10% ($)
- --------------------- ------------------- --------------------- ----------- ----------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Stephen A. Wynn 1,000,000 17.3% $ 32.375 8/16/05 $ 20,360,464 $ 51,597,412
Barry A. Shier 1,000,000 17.3 32.375 8/16/05 20,360,464 51,597,412
Bruce A. Levin 0 -- -- -- -- --
Daniel R. Lee 0 -- -- -- -- --
Kenneth R. Wynn 250,000 4.3 32.375 8/16/05 5,090,116 12,899,353
</TABLE>
- ------------------------
(1) The options granted to Messrs. Stephen A. Wynn and Kenneth R. Wynn become
exercisable in cumulative 20% installments commencing one year from the date
of grant. The option granted to Mr. Shier becomes exercisable on May 16,
2005. Exercisability of the options may be accelerated upon the occurrence
of certain fundamental corporate changes or at the discretion of the Stock
Option Committee.
(2) All such options were granted at market value (the closing sale price of the
Common Stock on the NYSE Composite Tape) on the date of grant. Under the
terms of the Company's Stock Option and Stock Appreciation Rights Plans, the
Stock Option Committee retains discretion, subject to plan limitations, to
modify the terms of outstanding options and to reprice options. The exercise
price of the options may be paid in cash, by delivery of shares of Common
Stock or by offset of the underlying shares, subject to certain conditions.
(3) The options are subject to early termination in the event of termination of
employment.
AGGREGATED OPTION EXERCISES IN 1995 AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING
UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES FISCAL YEAR-END(#) FISCAL YEAR-END($)
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/UNEXERCISABLE
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE (1)
- -------------------------- ----------- -------------- ------------------ ---------------------------
<S> <C> <C> <C> <C> <C> <C>
Stephen A. Wynn 0 -- 5,875,000/ 1,000,000 $134,287,500/ $2,125,000
Barry A. Shier 0 -- 375,000/ 1,375,000 8,475,000/ 11,687,500
Bruce A. Levin 0 -- 130,000/ 100,000 3,256,500/ 2,505,000
Daniel R. Lee 0 -- 270,000/ 200,000 6,696,000/ 4,960,000
Kenneth R. Wynn 0 -- 0/ 250,000 0/ 531,250
</TABLE>
- ------------------------
(1) Represents the difference between the closing sale price of the Common Stock
on the NYSE Composite Tape on December 29, 1995 and the exercise price of
the options.
EMPLOYMENT AGREEMENT
On December 16, 1992, the Company entered into a 10-year Employment
Agreement with Stephen A. Wynn pursuant to which Mr. Wynn serves as President
and Chief Executive Officer of the Company at an annual salary of $2,500,000.
Mr. Wynn shall be entitled to such bonuses, stock options and other compensation
as may be determined from time to time by the Board of Directors. Pursuant to
the Employment Agreement, the Company also provides Mr. Wynn with the personal
use of an automobile for which the Company pays all insurance, gasoline and
maintenance expenses, and provides Mr. Wynn and his dependents with
reimbursement for medical expenses and coverage under the Company's life
insurance program.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company or its subsidiaries (Messrs.
Popeil, Mason, Wolzinger and Wayson and Mrs. Wynn) were paid a monthly retainer
during 1995 of $4,000, representing $2,000 for services as a director of the
Company and $1,000 for services as a director of each of the Company's
7
<PAGE>
subsidiaries which own and operate The Mirage and the Golden Nugget
hotel-casinos, and continue to receive such retainer in 1996. Messrs. Popeil,
Mason and Wolzinger received an additional monthly fee of $1,000 for their
services as members of the Company's Audit and Stock Option Committees during
1995, and continue to receive such fee in 1996. Directors also receive
reimbursement for medical expenses and coverage under the Company's life
insurance program. Directors who are employees of the Company or its
subsidiaries do not receive compensation for their services as directors.
Pursuant to the Director Plan, as amended by the Board of Directors in
January 1996, each director who is not an employee of the Company or its
subsidiaries was granted 2,500 stock options in January 1995 at an exercise
price of $23 per share and 5,000 stock options in January 1996 at an exercise
price of $38.875 per share, and will be granted an additional 5,000 stock
options in each succeeding year in which he or she remains a director. If the
amendment to the Director Plan is not approved at the Meeting (see "Proposal to
Amend the 1992 Non-Employee Director Stock Option Plan"), 2,500 of the 5,000
stock options granted to each non-employee director in January 1996 will be
cancelled and the number of additional stock options to be granted to each
non-employee director in each succeeding year will be 2,500. Stock options
granted under the Director Plan have an exercise price equal to the market value
of the Common Stock on each date of grant and become exercisable three years
thereafter. An aggregate of up to 250,000 stock options may be granted under the
Director Plan, of which 125,000 are currently outstanding.
8
<PAGE>
COMPARATIVE STOCK PRICE PERFORMANCE GRAPH
The graph below compares the cumulative total stockholder return from
December 31, 1990 to December 31, 1995, assuming reinvestment of dividends, of
the Company, the NYSE Market Index (which consists of all common stocks listed
on the NYSE), the Media General Industry Group 241 -- Hotels, Motels, Resorts
(the "MG Index") and the Dow Jones Industry Group (Casinos). The graph assumes
an investment of $100 on December 31, 1990 in each of the Common Stock and the
stocks comprising the NYSE Market Index, the MG Index and the Dow Jones Industry
Group (Casinos).
In the Proxy Statement for its 1995 Annual Meeting of Stockholders, the
Company compared the five-year performance of its Common Stock to the NYSE
Market Index and the Dow Jones Industry Group (Casinos) and did not include the
MG Index. The Company has elected to include the MG Index herein because it
believes that the MG Index comprises a more complete and representative group of
the Company's industry competitors than the Dow Jones Industry Group (Casinos).
The Company does not intend to include the Dow Jones Industry Group (Casinos) in
future Proxy Statements.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MIRAGE RESORTS, INCORPORATED (1) DOW JONES INDUSTRY GROUP (CASINOS) (1) NYSE MARKET INDEX (1)
<S> <C> <C> <C>
1990 100.00 100.00 100.00
1991 148.99 140.46 129.41
1992 175.84 226.53 135.50
1993 320.47 328.18 153.85
1994 275.17 214.63 150.86
1995 463.09 252.07 195.61
<CAPTION>
MG INDEX (1)
<S> <C>
1990 100.00
1991 133.27
1992 187.82
1993 299.48
1994 249.26
1995 279.24
</TABLE>
(1) The data points in this graph were calculated by Media General Financial
Services, Inc., Richmond, Virginia.
9
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company has no compensation committee. Decisions concerning executive
officer compensation for 1995 were made by the full Board of Directors and, with
respect to the grant of stock options and the award of cash bonuses, by the
Stock Option Committee and the Bonus Committee, respectively. The following
members of the Board of Directors are officers or former officers of the Company
or its subsidiaries: Stephen A. Wynn; Richard D. Bronson; and Daniel B. Wayson.
Director Elaine P. Wynn is the wife of Stephen A. Wynn.
DMX, a publicly traded corporation of which Stephen A. Wynn is a director
and beneficially owns approximately 13.2% of the outstanding common stock,
programs and distributes a premium digital music service for the Company's four
hotel-casinos pursuant to a five-year agreement with the Company which commenced
in April 1995. The Company expects to pay DMX approximately $64,000 for such
service during 1996.
In January 1996, a trust of which Stephen A. Wynn is the sole beneficiary
purchased an additional .68 acre of property underlying Mr. Wynn's personal
residence in Shadow Creek Golf Course from an indirect wholly owned subsidiary
of the Company. The purchase price was $170,000, which was based on the per-acre
appraised value paid by Mr. Wynn when he purchased his original 3.99-acre parcel
from the subsidiary in April 1993.
In 1995, the Company paid Edward O. Wayson, Jr., P.A., a law firm in
Annapolis, Maryland owned by the brother of director Daniel B. Wayson, $78,640
for legal services in connection with the Company's evaluation of expansion
opportunities.
In September 1995, GNL, CORP. ("GNL"), a wholly owned subsidiary of the
Company which owns and operates the Golden Nugget-Laughlin hotel-casino, entered
into a lease with Southern Nevada Ice Cream, Inc. ("SNIC"). SNIC is a franchisee
of Swensen's Ice Cream, a major operator and franchisor of full-service ice
cream parlors. Connie Wolzinger, the daughter of director Melvin B. Wolzinger,
is the President and sole stockholder of SNIC. Pursuant to the lease, GNL
constructed and leases to SNIC a 900-square-foot Swensen's ice cream parlor at
the Golden Nugget-Laughlin. SNIC is required to pay GNL $200,000 to defray a
portion of the construction costs, of which $40,000 was paid in 1995. The lease
has a term of five years and provides for monthly base rent of $1,400 plus
additional rent based on a percentage of SNIC's gross monthly sales.
REPORT ON EXECUTIVE COMPENSATION
COMPENSATION POLICIES AND BASE SALARIES
The Company has no formal compensation policies applicable to executive
officers. Decisions concerning executive officers' base salaries for 1995 were
made by the full Board of Directors, based upon the recommendations of the
Company's Chief Executive Officer. In 1995, two executive officers, including
Kenneth R. Wynn, received salary increases. Decisions concerning the grant of
stock options and the award of cash bonuses to executive officers were made by
the Stock Option Committee and the Bonus Committee, respectively, and were
similarly based upon the recommendations of the Chief Executive Officer. The
Chief Executive Officer's recommendations in each case were based on his
subjective evaluation of each officer's (including his own) contribution to the
Company and the level of compensation necessary to adequately motivate and
reward the officer. The composition and amount of each item of executive
compensation for 1995 did not bear a specific relationship to any particular
measure of the Company's performance.
In addition to the Chief Executive Officer's Employment Agreement discussed
below, during 1995 two other executive officers (neither of whom is a Named
Officer) were parties to employment agreements with the Company. Compensation
paid to such executive officers for 1995 was consistent with the terms of such
employment agreements.
STOCK OPTIONS
The Company's Stock Option and Stock Appreciation Rights Plans are an
important component of the Company's compensation program for executive officers
and other employees. The stock option plans are
10
<PAGE>
intended to advance the interests of the Company and its stockholders by
encouraging and enabling executive officers and other employees, upon whose
judgment, initiative and effort the Company is largely dependent for the
successful conduct of its business, to acquire and retain a proprietary interest
in the Company by ownership of its stock. Through stock option grants, the
long-range interests of management and employees are aligned with those of
stockholders as the stock option recipients accumulate (through the vesting of
stock options) meaningful stakes in the Company. The Company's stock option
plans are administered by the Stock Option Committee, which is composed of three
non-employee members of the Board of Directors who also serve as the members of
the Audit and Bonus Committees. Decisions concerning the grant of stock options,
including the individuals to whom options were granted and the respective
exercise prices and vesting periods, were made by the Stock Option Committee
based upon the recommendations of the Chief Executive Officer. Such
recommendations and decisions were made on a subjective basis and did not bear a
specific relationship to any particular measure of the Company's performance. In
1995, stock options were granted to four executive officers, including the Chief
Executive Officer and Messrs. Shier and Kenneth R. Wynn. See "Executive
Compensation -- Option Grants in 1995" for information concerning stock options
granted to the Named Officers.
CASH BONUSES
In addition to base salary and stock options, the other principal part of
the Company's executive compensation program consists of cash bonuses awarded
pursuant to the Company's Amended and Restated 1994 Cash Bonus Plan (the "Bonus
Plan"), which was approved by the Company's stockholders in May 1994. The Bonus
Plan provides for an annual bonus pool equal to 5% of the Company's consolidated
earnings before depreciation, interest and taxes in excess of $250,000,000. Out
of the bonus pool, each executive officer is eligible to receive a bonus of up
to 50% of his annual base salary in effect on March 31, 1994, the effective date
of the Bonus Plan. The Bonus Plan is administered by the Bonus Committee, which
is composed of three non-employee members of the Board of Directors. Decisions
concerning the award of bonuses pursuant to the Bonus Plan (within the
above-described limitations) were made by the Bonus Committee upon the
recommendations of the Chief Executive Officer. Such recommendations and
decisions were made on a subjective basis and did not bear specific relationship
to any particular measure of the Company's performance. In 1995, bonuses were
awarded to each executive officer in amounts ranging from approximately 11% to
50% of annual base salary. See "Executive Compensation -- Summary Compensation
Table" for information concerning bonuses awarded to the Named Officers.
OTHER COMPENSATION
The Company also provides certain perquisites and other personal benefits to
executive officers, which constitute a small percentage of their total
compensation. See footnote (1) to "Executive Compensation -- Summary
Compensation Table."
INTERNAL REVENUE CODE SECTION 162(M)
Section 162(m) of the Code eliminates the federal income tax deductibility
of most compensation exceeding $1,000,000 paid to the chief executive officer or
the four highest compensated executive officers (other than the chief executive
officer) of publicly held corporations. Certain types of compensation are not
affected by the deduction limitation, including compensation paid pursuant to a
binding agreement entered into on or before February 17, 1993 and compensation
paid pursuant to a qualifying performance-based plan such as the Bonus Plan and
the Company's Stock Option and Stock Appreciation Rights Plans. The Bonus Plan
was adopted in 1994 in response to the enactment of Section 162(m) in order to
permit the Company to continue deducting bonuses paid to the Chief Executive
Officer and other executive officers whose annual compensation exceeds
$1,000,000. In making compensation decisions, the Board of Directors takes into
account the effect of Section 162(m), although in appropriate circumstances it
may determine to award compensation to covered executive officers which is not
fully deductible by the Company by virtue of Section 162(m).
COMPENSATION OF CHIEF EXECUTIVE OFFICER
In 1995, the Chief Executive Officer received a salary of $2,500,000
pursuant to a 10-year Employment Agreement approved by the Board of Directors in
December 1992. See "Executive Compensation -- Employment Agreement." The amount
of such salary was determined by the Board of Directors based upon the Chief
Executive Officer's recommendation. Such recommendation and determination were
made on a
11
<PAGE>
subjective basis and did not bear a specific relationship to any particular
measure of the Company's performance during 1995 or any prior period. In
adopting the Chief Executive Officer's recommendation, the Board of Directors
considered a large number of factors, including (1) the record of leadership and
service provided by the Chief Executive Officer since joining the Company in
1973, (2) the identification of the Company with the Chief Executive Officer by
the financial community and the general public, and the recognition by the Board
of Directors and others in the gaming industry of the importance of his
leadership, creativity and other personal attributes to the Company's continued
success, (3) the total stockholder return obtained by the Company during the
past five years, which significantly surpassed that of both the broad market and
the Company's principal industry competitors as a group (see "Comparative Stock
Price Performance Graph"), (4) the achievements recorded by the Company since
the Chief Executive Officer's annual salary was last increased in March 1990,
including the successful financial performance of The Mirage, the Company's
flagship hotel-casino, since opening in November 1989, the restructuring of a
significant portion of the Company's long-term debt and the successful
completion of equity offerings in 1991 and 1992, resulting in a reduction of the
Company's average cost of capital, the development and construction of Treasure
Island at The Mirage, the Company's newest hotel-casino, which opened on
schedule in October 1993, and the purchase, for future development, of the
164-acre site of the former Dunes Hotel, Casino and Country Club on the Las
Vegas Strip, which was consummated in January 1993, (5) the fact that the Chief
Executive Officer is the Company's principal stockholder and thereby holds a
significant stake in the Company's future and (6) the fact that the Chief
Executive Officer's annual salary had not been increased in almost three years,
and that he was not awarded a cash bonus in 1991 or 1992. No specific weight was
assigned to any particular factor.
In 1995, the Chief Executive Officer was awarded a cash bonus of $1,250,000
(50% of his annual base salary) pursuant to the Bonus Plan. The amount of such
bonus was determined by the Bonus Committee based upon the recommendation of the
Chief Executive Officer. Such recommendation and determination were made on a
subjective basis, taking into account the Chief Executive Officer's
contributions to the Company and the amount necessary to adequately reward the
Chief Executive Officer, and did not bear a specific relationship to any
particular measure of the Company's performance during 1995.
In 1995, the Chief Executive Officer was granted a stock option to purchase
1,000,000 shares of Common Stock with an exercise price of $32.375, the market
value of the Common Stock on the date of grant. The option becomes exercisable
in cumulative 20% installments commencing one year from the date of grant. The
option was granted by the Stock Option Committee based upon the recommendation
of the Chief Executive Officer. Such recommendation and grant were made on a
subjective basis, taking into account the Chief Executive Officer's
contributions to the Company, and did not bear a specific relationship to any
particular measure of the Company's performance during 1995.
BY THE BOARD OF DIRECTORS
Stephen A. Wynn, Chairman
Melvin B. Wolzinger
George J. Mason
Ronald M. Popeil
Elaine P. Wynn
Daniel B. Wayson
Richard D. Bronson
BY THE STOCK OPTION COMMITTEE
Ronald M. Popeil, Chairman
Melvin B. Wolzinger
George J. Mason
BY THE BONUS COMMITTEE
Ronald M. Popeil, Chairman
Melvin B. Wolzinger
George J. Mason
12
<PAGE>
PROPOSAL TO AMEND THE 1992 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
SUMMARY OF THE PROPOSED AMENDMENT
The Company's Board of Directors adopted the Director Plan in February 1992,
and the Director Plan was approved by the Company's stockholders in May 1992. On
January 23, 1996, the Board of Directors adopted an amendment to Paragraph 6(b)
of the Director Plan (the "Amendment"), subject to stockholder approval at the
Meeting. The effect of the Amendment was to increase from 2,500 to 5,000 the
number of shares subject to the option granted to each non-employee director of
the Company in each year following the year of the initial grant to such
non-employee director. The following is a summary of the Director Plan as
currently in effect and as proposed to be amended.
PURPOSE OF THE DIRECTOR PLAN
The purpose of the Director Plan is to advance the interests of the Company
and its stockholders by encouraging and enabling members of its Board of
Directors who are not officers or employees of the Company or any of its
subsidiaries, upon whose judgment, initiative and effort the Company is largely
dependent for the successful conduct of its business, to acquire and retain a
proprietary interest in the Company by ownership of its stock through the
exercise of stock options. The Board of Directors believes that the Amendment
furthers this purpose by more adequately motivating and rewarding non-employee
directors for their service to the Company.
AMOUNT OF COMMON STOCK SUBJECT TO OPTIONS UNDER THE DIRECTOR PLAN
The Director Plan provides for the grant of Non-Qualified Options to
purchase an aggregate of 250,000 shares of Common Stock, of which options to
purchase 125,000 shares are outstanding and options to purchase 125,000 shares
are available for future grant. The number of shares of Common Stock subject to
options is subject to equitable adjustments for any stock dividends, stock
splits, recapitalizations, reclassifications or any other similar changes which
may be required in order to prevent dilution. Any option which is not exercised
prior to expiration or which otherwise terminates will thereafter be available
for further grant under the Director Plan.
ADMINISTRATION OF THE DIRECTOR PLAN
The Director Plan is administered by the Board of Directors. Subject to the
conditions set forth in the Director Plan, the Board of Directors has full and
final authority to interpret the Director Plan, to adopt and rescind
administrative regulations to further the purposes of the Director Plan and to
take any other action necessary to the proper operation of the Director Plan.
The Director Plan is designed to operate automatically and is not intended to be
flexible, and very little discretion is vested in the Board of Directors with
respect to administration of the Director Plan.
PARTICIPANTS
Options are granted under the Director Plan to each director of the Company
who is not an employee or officer of the Company or any of its subsidiaries and
has served in such capacity for at least 36 consecutive calendar months.
GRANT OF OPTIONS
On May 28, 1992, the date the Director Plan was approved by the stockholders
of the Company, each person who on such date had been a non-employee director of
the Company for at least 36 consecutive calendar months was granted an option to
purchase 12,500 shares of Common Stock at an exercise price of $10.25, the
closing sale price of the Common Stock on the NYSE Composite Tape on the fourth
Wednesday of January 1992. Each future non-employee director of the Company will
be granted an option to purchase 12,500 shares of Common Stock on the fourth
Wednesday of January immediately following his or her completion of 36
consecutive calendar months of service as a non-employee director at an exercise
price equal to the fair market value of the Common Stock on that date, provided
that such person is a non-employee director on that date. The closing sale price
of the Common Stock on the NYSE Composite Tape on April 10, 1996 was $45.625 per
share. Under the Director Plan as in effect prior to the Amendment, on the
fourth Wednesday of January of each year after the year in which a non-employee
director of the Company received his or her initial grant of an option, such
non-employee director was granted an option to
13
<PAGE>
purchase 2,500 shares of Common Stock at an exercise price equal to the fair
market value of the Common Stock on that date, provided that such person was a
non-employee director of the Company on that date. Pursuant to such provision,
each of the five current non-employee directors was granted an option to
purchase 2,500 shares of Common Stock in January 1993, January 1994 and January
1995. Pursuant to the Amendment, the number of shares subject to such option was
increased from 2,500 to 5,000, commencing with the options granted in January
1996. If the Amendment is not approved at the Meeting, options to purchase 2,500
of the 5,000 shares granted to each non-employee director in January 1996 will
be cancelled, and the number of shares subject to the option to be granted to
each non-employee director in each succeeding year will revert to 2,500.
TERM OF OPTIONS
Options granted under the Director Plan expire 10 years after the date of
grant, subject to earlier termination in the event an optionee's service as a
non-employee director terminates. See "Termination of Relationship."
EXERCISE OF OPTIONS
Each option granted under the Director Plan shall be exercisable, in whole
or in part, beginning on the third anniversary of the date of grant of such
option and ending on the expiration or earlier termination of such option.
Payment of the exercise price upon exercise of an option may be made in any
combination of cash and shares of Common Stock, including the automatic
application of shares of Common Stock received upon exercise of an option to
satisfy the exercise price of additional options. Where payment is made in
Common Stock, such Common Stock shall be valued for such purpose at the fair
market value of such shares on the date of exercise.
NON-TRANSFERABILITY
Options granted under the Director Plan are not transferable or assignable,
otherwise than by will or the laws of descent and distribution and, during the
lifetime of the holder, options are exercisable only by the holder.
TERMINATION OF RELATIONSHIP
If an optionee's service as a non-employee director terminates for any
reason other than death or Permanent Disability (as defined), or because the
optionee becomes employed by the Company or any of its subsidiaries, or if an
optionee becomes employed by the Company or any of its subsidiaries and such
employment subsequently terminates for any reason other than death or Permanent
Disability, the optionee's options shall terminate three months after the date
of such termination (or upon the option's expiration, if earlier). If an
optionee's service as a non-employee director terminates as a result of death or
Permanent Disability, or if an optionee becomes employed by the Company or any
of its subsidiaries and such employment subsequently terminates as a result of
death or Permanent Disability, the optionee's options shall terminate one year
after the date of such termination (or upon the option's expiration, if
earlier). An optionee's options shall be exercisable following his or her
termination of service as a non-employee director or following his or her
termination of such subsequent employment only to the extent they were
exercisable immediately prior to such termination of service or employment, as
the case may be.
EFFECTIVE DATE AND TERM OF THE DIRECTOR PLAN
Options were initially granted under the Director Plan on May 28, 1992, the
date the Director Plan was approved by the stockholders. The Amendment, if
approved, will become effective with respect to the options granted on January
24, 1996 and options to be granted in each succeeding year. The Director Plan
shall be of unlimited duration, subject to termination or suspension of the
Director Plan by the Board of Directors.
AMENDMENT AND TERMINATION OF THE DIRECTOR PLAN
The Board of Directors may at any time and from time to time amend, suspend
or terminate the Director Plan, except that (i) Paragraph 6 of the Director Plan
(dealing with the grant, exercise, term,
14
<PAGE>
termination and transferability of options) may not be amended more than once
every six months, other than to comport with changes in the Code, the Employee
Retirement Income Security Act or the rules thereunder and (ii) without the
approval of the stockholders of the Company representing a majority of the
voting power, no such amendment shall increase the maximum number of shares of
Common Stock subject to options which may be granted under the Director Plan,
change the provisions concerning the exercise price of options granted, increase
the term during which options may be exercised, materially increase the benefits
to participants under the Director Plan or change the class of eligible
participants. No amendment, suspension or termination of the Director Plan by
the Board of Directors may alter or impair any of the rights under any option
granted under the Director Plan without the holder's consent.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The Company believes that the grant of an option under the Director Plan is
not subject to federal income tax. Upon exercise, the optionee generally will
recognize ordinary income in an amount equal to the excess of the fair market
value of the shares on the date of exercise over the exercise price. Gain or
loss on the subsequent sale of shares received on exercise of an option
generally will be long-term or short-term capital gain or loss, depending on the
holding period of the shares.
Upon exercise of an option, the Company generally will be entitled to a
compensation deduction for federal income tax purposes in the year and in the
same amount as the optionee is considered to have recognized ordinary income
(assuming that such compensation is reasonable).
RECOMMENDATION AND REQUIRED VOTE
The Board of Directors recommends a vote FOR approval of the Amendment.
Approval of the Amendment requires the affirmative vote of the holders of a
majority of the shares of Common Stock represented at the Meeting.
INFORMATION CONCERNING THE BOARD OF DIRECTORS
AND ITS COMMITTEES
The committees created by the Board of Directors are the Audit Committee,
the Stock Option Committee and the Bonus Committee. The Board of Directors has
not designated a nominating committee or a compensation committee.
The Audit Committee held seven meetings during 1995. The functions of the
Audit Committee include reviewing and making recommendations to the Board of
Directors with respect to: the engagement or re-engagement of an independent
accounting firm to audit the Company's financial statements for the then current
fiscal year, and the terms of the engagement; the policies and procedures of the
Company with respect to maintaining the Company's books and records and
furnishing any necessary information to the independent auditors; the procedures
to encourage access to the Audit Committee and to facilitate the timely
reporting during the year by authorized representatives of the Company's
independent auditors to the Audit Committee of their recommendations and advice;
the implementation by the Company's management of such recommendations and
advice; the implementation by management of the recommendations made by the
independent auditors in their management letters, the adequacy and
implementation of the Company's internal audit controls and the adequacy and
competency of the related personnel; and such other matters relating to the
Company's financial affairs and accounts as the Audit Committee may in its
discretion deem desirable. The Audit Committee also has certain other
responsibilities, including the responsibility to oversee the employment and
marketing practices of the Company and its gaming subsidiaries and their
compliance with gaming regulations.
The Stock Option Committee took action by written consent on nine occasions
during 1995. The Stock Option Committee administers the Company's various Stock
Option and Stock Appreciation Rights Plans. Subject to the conditions set forth
in the plans, the Stock Option Committee has full and final authority to
determine the number of stock options or stock appreciation rights ("SARs") to
be granted, the individuals
15
<PAGE>
to whom and the time or times at which such options or SARs shall be granted or
be exercisable, their exercise prices and the terms and provisions of the
respective agreements to be entered into at the time of grant, which may vary.
The Bonus Committee took action by written consent on three occasions during
1995. The Bonus Committee administers the Bonus Plan. Subject to the conditions
set forth in the Bonus Plan, the Bonus Committee has full and final authority to
award cash bonuses pursuant to the Bonus Plan, to construe and interpret the
Bonus Plan, to adopt amendments to the Bonus Plan (subject to stockholder
approval in certain cases) and to make all other determinations and take all
other action deemed necessary or advisable for the proper administration of the
Bonus Plan.
The Board of Directors held eight meetings, and took action by unanimous
written consent on four occasions, during 1995. Each director attended at least
75% of the aggregate number of meetings of the Board of Directors and the
committees on which he or she served.
INDEPENDENT ACCOUNTANTS
The Company's independent accountants for 1995 were Arthur Andersen LLP
("AA"), which firm has been appointed to serve in such capacity for the current
year. A representative of AA is expected to be present at the Meeting with the
opportunity to make a statement if he or she so desires and to respond to
appropriate questions.
On April 29, 1994, the Company dismissed its former independent accountants,
Coopers & Lybrand ("C&L"), and replaced C&L with AA. The decision to change
independent accountants was made following a review of competitive proposals
submitted by C&L, AA and other major public accounting firms, and was approved
by the Company's Audit Committee.
C&L's reports on the Company's consolidated financial statements for 1992
and 1993 did not contain an adverse opinion or a disclaimer of opinion, and were
not qualified or modified as to uncertainty, audit scope or accounting
principles. During 1992 and 1993 and the period from January 1, 1994 through
April 29, 1994, there were no disagreements between the Company and C&L on any
matter of accounting principles or practices, financial statement disclosure or
auditing scope or procedure, which disagreements, if not resolved to the
satisfaction of C&L, would have caused C&L to make a reference to the subject
matter of the disagreement in connection with its reports.
C&L submitted the following statement in a letter to the Commission dated
May 19, 1994, which was previously filed by the Company pursuant to the 1934
Act, and has requested the Company to reprint the statement in this Proxy
Statement:
"We have read the statements made by Mirage Resorts, Incorporated
. . . , which we understand was filed with the Commission, pursuant to Item
4 of Form 8-K, as part of the Company's Form 8-K report dated April 29,
1994. We do not agree with the statements concerning our Firm in such Form
8-K. Disagreements with the Company relating to matters that would have led
to reference thereto in our report on the financial statements for the year
ended December 31, 1993, if such matters had not been resolved to our
satisfaction follow:
Coopers & Lybrand and Company management had a disagreement
concerning the need to contact the staff of the Securities and
Exchange Commission (SEC) in order to ensure that its accounting
treatment for preopening costs was not in violation of guidance
previously provided to the Company by the staff.
On April 1, 1994, prior to filing its Form 10-K, the Company, at
our insistence, contacted the SEC staff. This resulted in
acceptance of the Company's proposed treatment. As such, the
disagreement was resolved to Coopers & Lybrand's satisfaction.
This matter was discussed with the Company's Audit Committee."
16
<PAGE>
FUTURE PROPOSALS OF STOCKHOLDERS
Any stockholder intending to submit to the Company a proposal for inclusion
in the Company's Proxy Statement and form of Proxy for the 1997 Annual Meeting
of Stockholders must submit such proposal sufficiently far in advance so that it
is received by the Company not later than December 17, 1996.
DISCRETIONARY AUTHORITY
While the Notice of Annual Meeting of Stockholders calls for the transaction
of such other business as may properly come before the Meeting, the Board of
Directors has no knowledge of any matters to be presented for action by the
stockholders at the Meeting, other than as set forth above. The enclosed Proxy
gives discretionary authority, however, in the event that any additional matters
should be presented.
STOCKHOLDERS ARE URGED IMMEDIATELY TO MARK, DATE AND SIGN THE ENCLOSED PROXY
AND RETURN IT IN THE ENVELOPE PROVIDED, TO WHICH NO POSTAGE NEED BE AFFIXED IF
MAILED IN THE UNITED STATES.
By the Board of Directors
KENNETH R. WYNN
SECRETARY
17
<PAGE>
MIRAGE RESORTS, INCORPORATED
P PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
R
O The undersigned appoints George J. Mason and Melvin B. Wolzinger, and
X each of them, as Proxies, each with the power to appoint his substitute,
Y and authorizes each of them to represent and to vote, as designated on the
reverse, all the shares of Common Stock of Mirage Resorts, Incorporated
held of record by the undersigned on March 29, 1996, at the Annual
Meeting of Stockholders to be held on May 23, 1996 or any adjournment
thereof.
(Change of Address/Comments)
Election of Directors, Nominees: _____________________________
_____________________________
Elaine P. Wynn, Richard D. Bronson _____________________________
_____________________________
_____________________________
You are encouraged to specify your choices by marking the
appropriate boxes, SEE REVERSE SIDE, but you need not mark
any boxes if you wish to vote in accordance with the Board SEE REVERSE
of Directors' recommendations. The Proxies cannot vote your SIDE
shares unless you sign and return this card.
<PAGE>
/X/ Please mark your
votes as in this
example.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of / / / / 2. Proposal to approve the amendment / / / / / /
Directors to the 1992 Non-Employee Director
Stock Option Plan.
For, except vote withheld from 3. IN THEIR DISCRETION, THE PROXIES
the following nominee(s): ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME
______________________________ BEFORE THE MEETING.
</TABLE>
SIGNATURE(S) ____________________________________ DATE ___________________
Note: Please sign exactly as name appears hereon. Joint owners should each
sign. When signing as attorney, executor, administrator, trustee or
guardian, please give full title as such.
