Document:

exv10w2

 

Exhibit 10.2

Deferred Compensation Plan II

Master Plan Document

Effective December 30, 2004

 

 

Deferred Compensation Plan II

Master Plan Document

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page
	Purpose

	 	 	 	 	1	 
	ARTICLE 1

	 	Definitions
	 	 	1	 
	ARTICLE 2

	 	Selection, Enrollment, Eligibility
	 	 	6	 
	2.1

	 	Selection by Committee
	 	 	6	 
	2.2

	 	Enrollment Requirements
	 	 	6	 
	2.3

	 	Eligibility; Commencement of Participation
	 	 	6	 
	2.4

	 	Termination of Participation and/or Deferrals
	 	 	7	 
	ARTICLE 3

	 	Deferral Commitments/Company Contribution/Company Matching/Crediting Taxes
	 	 	7	 
	3.1

	 	Minimum Deferrals
	 	 	7	 
	3.2

	 	Maximum Deferrals
	 	 	7	 
	3.3

	 	Election to Defer; Effect of Election Form
	 	 	8	 
	3.4

	 	Withholding of Annual Deferral Amounts
	 	 	8	 
	3.5

	 	Transfer Amount
	 	 	8	 
	3.6

	 	Annual Company Matching Amount
	 	 	9	 
	3.7

	 	Vesting
	 	 	9	 
	3.8

	 	Crediting/Debiting of Account Balances
	 	 	10	 
	3.9

	 	FICA and Other Taxes
	 	 	11	 
	ARTICLE 4

	 	Short-Term Payout; Unforeseeable Financial Emergencies; Withdrawal Election
	 	 	12	 
	4.1

	 	Short-Term Payout
	 	 	12	 
	4.2

	 	Other Benefits Take Precedence Over Short-Term
	 	 	12	 
	4.3

	 	Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies
	 	 	13	 
	ARTICLE 5

	 	Retirement Benefit
	 	 	13	 
	5.1

	 	Retirement Benefit
	 	 	13	 
	5.2

	 	Payment of Retirement Benefit
	 	 	13	 
	5.3

	 	Death Prior to Completion of Retirement Benefit
	 	 	13	 
	ARTICLE 6

	 	Pre-Retirement Survivor Benefit
	 	 	14	 
	6.1

	 	Pre-Retirement Survivor Benefit
	 	 	14	 
	6.2

	 	Payment of Pre-Retirement Survivor Benefit
	 	 	14	 

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Deferred Compensation Plan II

Master Plan Document

	 	 	 	 	 	 	 
	ARTICLE 7

	 	Termination Benefit
	 	 	15	 
	7.1

	 	Termination Benefit
	 	 	15	 
	7.2

	 	Payment of Termination Benefit
	 	 	15	 
	7.3

	 	Death Prior to Completion of Retirement Benefit
	 	 	15	 
	ARTICLE 8

	 	Disability Waiver and Benefit
	 	 	15	 
	8.1

	 	Disability Waiver
	 	 	15	 
	8.2

	 	Continued Eligibility; Disability Benefit
	 	 	16	 
	ARTICLE 9

	 	Beneficiary Designation
	 	 	16	 
	9.1

	 	Beneficiary
	 	 	16	 
	9.2

	 	Beneficiary Designation; Change; Spousal Consent
	 	 	17	 
	9.3

	 	Acknowledgement
	 	 	17	 
	9.4

	 	No Beneficiary Designation
	 	 	17	 
	9.5

	 	Doubt as to Beneficiary
	 	 	17	 
	9.6

	 	Discharge of Obligations
	 	 	17	 
	ARTICLE 10

	 	Leave of Absence
	 	 	17	 
	10.1

	 	Paid Leave of Absence
	 	 	17	 
	10.2

	 	Unpaid Leave of Absence
	 	 	17	 
	ARTICLE 11

	 	Termination, Amendment or Modification
	 	 	18	 
	11.1

	 	Termination
	 	 	18	 
	11.2

	 	Amendment
	 	 	18	 
	11.3

	 	Plan Agreement
	 	 	19	 
	11.4

	 	Effect of Payment
	 	 	19	 
	ARTICLE 12

	 	Administration
	 	 	19	 
	12.1

	 	Committee Duties
	 	 	19	 
	12.2

	 	Agents
	 	 	19	 
	12.3

	 	Binding Effect of Decisions
	 	 	19	 
	12.4

	 	Indemnity of Committee
	 	 	19	 
	12.5

	 	Employer Information
	 	 	19	 
	ARTICLE 13

	 	Other Benefits and Agreements
	 	 	20	 
	13.1

	 	Coordination with Other Benefits
	 	 	20	 
	ARTICLE 14

	 	Claims Procedures
	 	 	20	 

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Deferred Compensation Plan II

Master Plan Document

	 	 	 	 	 	 	 
	14.1

	 	Presentation of Claim
	 	 	20	 
	14.2

	 	Notification of Decision
	 	 	20	 
	14.3

	 	Review of a Denied Claim
	 	 	20	 
	14.4

	 	Decision on Review
	 	 	21	 
	14.5

	 	Legal Action
	 	 	21	 
	ARTICLE 15

	 	Trust
	 	 	21	 
	15.1

	 	Establishment of the Trust
	 	 	21	 
	15.2

	 	Interrelationship of the Plan and the Trust
	 	 	21	 
	15.3

	 	Distributions from the Trust
	 	 	22	 
	15.4

	 	Investment of Trust Assets
	 	 	22	 
	15.5

	 	No Claim on Trust Assets
	 	 	22	 
	ARTICLE 16

	 	Miscellaneous
	 	 	22	 
	16.1

	 	Status of Plan
	 	 	22	 
	16.2

	 	Unsecured General Creditor
	 	 	22	 
	16.3

	 	Employer’s Liability
	 	 	22	 
	16.4

	 	Nonassignability
	 	 	23	 
	16.5

	 	Not a Contract of Employment
	 	 	23	 
	16.6

	 	Furnishing Information
	 	 	23	 
	16.7

	 	Terms
	 	 	23	 
	16.8

	 	Captions
	 	 	23	 
	16.9

	 	Governing Law
	 	 	23	 
	16.10

	 	Notice
	 	 	23	 
	16.11

	 	Successors
	 	 	24	 
	16.12

	 	Spouse’s Interest
	 	 	24	 
	16.13

	 	Validity
	 	 	24	 
	16.14

	 	Incompetent
	 	 	24	 
	16.15

	 	Court Order
	 	 	24	 
	16.16

	 	Distribution in the Event of Taxation
	 	 	24	 
	16.17

	 	Legal Fees To Enforce Rights After Change in Control
	 	 	25	 
	16.18

	 	Unvested Account Balances Under Prior Plan
	 	 	26	 

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Deferred Compensation Plan II

Master Plan Document

MGM MIRAGE

DEFERRED COMPENSATION PLAN II

Effective December 30, 2004

Purpose

The purpose of this Plan is to provide specified benefits to a select group of management and
highly compensated Employees who contribute materially to the continued growth, development and
future business success of MGM MIRAGE, a Delaware corporation, and its subsidiaries that sponsor
this Plan. This Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA.

ARTICLE 1

Definitions

For purposes of this Plan, unless otherwise clearly apparent from the context, the following
phrases or terms shall have the following indicated meanings:

	1.1  	“Account Balance” shall mean, with respect to a Participant, a credit on the records of the
Employer equal to the sum of (i) the Deferral Account balance, (ii) the Company Contribution
Account balance, (iii) the Company Matching Account balance and (iv) the Transfer Account
balance. The Account Balance, and each other specified account balance, shall be a
bookkeeping entry only and shall be utilized solely as a device for the measurement and
determination of the amounts to be paid to a Participant, or the Participant’s designated
Beneficiary, pursuant to this Plan.
	 
	1.2  	“Annual Company Contribution Amount” shall mean, for any one Plan Year, the amount determined
in accordance with Section 3.9.
	 
	1.3  	“Annual Company Matching Amount” shall mean, for any one Plan Year, the amount determined in
accordance with Section 3.6.
	 
	1.4  	“Annual Deferral Amount” shall mean that portion of a Participant’s Base Annual Salary and
Bonus that a Participant elects to have, and is, deferred in accordance with Article 3, for
any one Plan Year. In the event of a Participant’s Retirement, Disability (if deferrals cease
in accordance with Section 8.1), death or a Termination of Employment prior to the end of a
Plan Year, such year’s Annual Deferral Amount shall be the actual amount withheld prior to
such event.
	 
	1.5  	“Base Annual Salary” shall mean the annual cash compensation relating to services performed
during any calendar year, whether or not paid in such calendar year or included on the Federal
Income Tax Form W-2 for such calendar year, excluding bonuses, commissions, overtime, fringe
benefits, stock options, relocation expenses, incentive payments, non-monetary awards and
other fees, automobile and other allowances paid to a Participant for employment services
rendered (whether or not such allowances are included in the Employee’s gross income). Base
Annual Salary shall be calculated before reduction for compensation voluntarily deferred or
contributed by the Participant pursuant to all qualified or non-qualified plans of any
Employer and shall be calculated to include amounts not otherwise included in the
Participant’s gross income under Code Sections 125, 402(e)(3), 402(h), or 403(b) pursuant to
plans established by any Employer;

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	   	provided, however, that all such amounts will be included in compensation only to the extent
that, had there been no such plan, the amount would have been payable in cash to the
Employee.
	 
	1.6  	“Beneficiary” shall mean one or more persons, trusts, estates or other entities, designated
in accordance with Article 9, that are entitled to receive benefits under this Plan upon the
death of a Participant or the death of a predecessor Beneficiary receiving benefits under the
Plan.
	 
	1.7  	“Beneficiary Designation Form” shall mean the form established from time to time by the
Committee that a Participant completes, signs and returns to the Committee to designate one or
more Beneficiaries.
	 
	1.8  	“Board” shall mean the board of directors of the Company.
	 
	1.9  	“Bonus” shall mean any cash compensation, other than Base Salary, earned by a Participant for
services rendered during a Plan Year, under any Employer’s bonus or cash incentive plans or
policies (whether written or oral).
	 
	1.10  	“Change in Control” shall mean the first to occur of any of the following events:

	 	(a)  	Any “person” or “group” of persons (as such terms are used in Section 13 and
14(d)(2) of the Securities Exchange Act of 1934, as amended (“Exchange Act”)), other
than Tracinda Corporation, Kirk Kerkorian, members of the immediate family of Kirk
Kerkorian, the heirs and legatees of Kirk Kerkorian and trusts or other entities for
the benefit of such persons or affiliates of such persons (as such term “affiliates”
is defined in the rules promulgated by the Securities and Exchange Commission), becomes
the beneficial owner (as that term is used in Section 13(d) of the Exchange Act),
directly or indirectly, of fifty percent (50%) or more of the Company’s capital stock
entitled to vote generally in the election of directors. (For the avoidance of doubt,
as of the date of the adoption of this Plan, Tracinda Corporation and its sole
shareholder, Kirk Kerkorian, are the beneficial owners of in excess of fifty percent
(50%) of the Company’s capital stock);
	 
	 	(b)  	At any time, individuals who, at the date of the adoption of this Plan,
constitute the Board, and any new director (other than a director designated by a
person who has entered into an agreement with the Company to effect a transaction
described in clause (a), (c), (d) or (e) of this Section 1.10) whose election by the
Board or nomination for election by the Company’s shareholders was approved by a
majority vote of either (1) the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for election
was previously so approved, or (2) the members of the Company’s Executive Committee
then still in office who either were members at the beginning of the period or whose
election or nomination for election to the Executive Committee was previously so
approved by the directors or the Executive Committee, cease for any reason to
constitute at least a majority of the Board;
	 
	 	(c)  	Any consolidation or merger of the Company, other than a consolidation or
merger of the Company in which the holders of the common stock of the Company
immediately prior to the consolidation or merger hold more than fifty percent (50%) of
the common stock of the surviving corporation immediately after the consolidation or
merger;

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	 	(d)  	Any liquidation or dissolution of the Company; or
	 
	 	(e)  	The sale or transfer of all or substantially all of the assets of the Company
to parties that are not within a “controlled group of corporations” (as defined in Code
Section 1563) in which the Company is a member.

	1.11  	“Claimant” shall have the meaning set forth in Section 14.1.
	 
	1.12  	“Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time.
	 
	1.13  	“Committee” shall mean the committee described in Article 12.
	 
	1.14  	“Company” shall mean MGM MIRAGE, a Delaware corporation, and any successor to all or
substantially all of the Company’s assets or business.
	 
	1.15  	“Company Contribution Account” shall mean the sum of (a) and (b) less the sum of (c) and (d):

	 	(a)  	All of the Participant’s Annual Company Contribution Amounts.
	 
	 	(b)  	Amounts credited or debited in accordance with all applicable crediting
provisions of this Plan that relate to the Participant’s Company Contribution Account.
	 
	 	(c)  	Any forfeitures under Section 3.7.
	 
	 	(d)  	All distributions made to the Participant or the Participant’s Beneficiary
pursuant to this Plan that relate to the Participant’s Company Contribution Account.

	1.16  	“Company Matching Account” shall mean the sum of (a) and (b) less the sum of (c) and (d):

	 	(a)  	All of the Participant’s Annual Company Matching Amounts.
	 
	 	(b)  	Amounts credited or debited in accordance with all applicable crediting
provisions of this Plan that relate to the Participant’s Company Matching Account.
	 
	 	(c)  	Any forfeitures under Section 3.7.
	 
	 	(d)  	All distributions made to the Participant or the Participant’s Beneficiary
pursuant to this Plan that relate to the Participant’s Company Matching Account.

	1.17  	“Deduction Limitation” shall mean the following described limitation on a benefit that may
otherwise be distributable pursuant to the provisions of this Plan. Except as otherwise
provided, this limitation shall be applied to all distributions that are “subject to the
Deduction Limitation” under this Plan. If an Employer determines in good faith prior to a
Change in Control that there is a reasonable likelihood that any compensation paid to a
Participant for a taxable year of the Employer would not be deductible by the Employer solely
by reason of the limitation under Code Section 162(m), then to the extent deemed necessary by
the Employer to ensure that the entire amount of any distribution to the Participant pursuant
to this Plan prior to the Change in Control is deductible, the Employer may defer all or any
portion of a distribution under this Plan. Any amounts deferred pursuant to this limitation
shall continue to be credited/debited with additional amounts in accordance with Section 3.8,
even if such amount is being paid out in installments. The amounts so deferred and amounts
credited thereon shall be distributed to the Participant or the Participant’s Beneficiary (in
the event of the Participant’s death) at the earliest possible date,

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	   	as determined by the Employer in good faith, on which the deductibility of compensation
paid or payable to the Participant for the taxable year of the Employer during which
the distribution is made will not be limited by Section 162(m). Notwithstanding the
foregoing, the Committee shall interpret this Section in a manner that is consistent
with Code Section 409A and the regulations thereunder, including without limitation
guidance issued in connection with that Section.
	 
	1.18  	“Deferral Account” shall mean the sum of (a) and (b) less (c):

	 	(a)  	The sum of all of a Participant’s Annual Deferral Amounts.
	 
	 	(b)  	Amounts credited or debited in accordance with all applicable crediting
provisions of this Plan that relate to the Participant’s Deferral Account.
	 
	 	(c)  	All distributions made to the Participant or the Participant’s Beneficiary
pursuant to this Plan that relate to the Participant’s Deferral Account.

	1.19  	“Disability” shall mean that a Participant (i) is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period of not less
than 12 months, as certified by a licensed physician, or (ii) is receiving income replacement
benefits for a period of not less than 3 months under an accident and health plan covering
employees of the Participant’s Employer by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months, as certified by a licensed physician in each
case.
	 
	1.20  	“Disability Benefit” shall mean the benefit set forth in Article 8.
	 
	1.21  	“Election Form” shall mean the form established from time to time by the Committee that a
Participant completes, signs and returns to the Committee to make an election under the Plan.
	 
	1.22  	“Employee” shall mean a person who is an employee of any Employer.
	 
	1.23  	“Employer(s)” shall mean the Company and/or any of its subsidiaries (now in existence or
hereafter formed or acquired) that have been selected by the Board to participate in the Plan
and have adopted the Plan as a sponsor.
	 
	1.24  	“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it may be amended
from time to time.
	 
	1.25  	“401(k) Savings Plan” shall mean the MGM MIRAGE 401(k) Savings Plan, as amended from time to
time.
	 
	1.26  	“Participant” shall mean any Employee (i) who is selected to participate in the Plan, (ii)
who elects to participate in the Plan, (iii) who signs a Plan Agreement, an Election Form and
a Beneficiary Designation Form, (iv) whose signed Plan Agreement, Election Form and
Beneficiary Designation Form are accepted by the Committee, (v) who commences participation in
the Plan, and (vi) whose Plan Agreement has not terminated. A spouse or former spouse of a
Participant, as such, shall not be treated as a Participant in the Plan or have an account
balance under the Plan, even if the Participant has an interest in the Participant’s benefits
under the Plan

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	   	in accordance with Article 5 or 6 of the Plan, or as a result of applicable law or property
settlements resulting from legal separation or divorce.
	 
	1.27  	“Plan” shall mean the Company’s Deferred Compensation Plan II, which shall be evidenced by
this instrument and by each Plan Agreement, as they may be amended from time to time.
	 
	1.28  	“Plan Agreement” shall mean a written agreement, as may be amended from time to time, which
is entered into by and between an Employer and a Participant. Each Plan Agreement executed by
a Participant and the Participant’s Employer shall provide for the entire benefit to which
such Participant is entitled under the Plan; should there be more than one Plan Agreement, the
Plan Agreement bearing the latest date of acceptance by the Employer shall supersede all
previous Plan Agreements in their entirety and shall govern such entitlement. The terms of
any Plan Agreement may be different for any Participant, and any Plan Agreement may provide
additional benefits not set forth in the Plan or limit the benefits otherwise provided under
the Plan; provided, however, that any such additional benefits or benefit limitations must be
agreed to by both the Employer and the Participant.
	 
	1.29  	“Plan Year” shall mean January 1 of each calendar year, beginning on or after January 1,
2005, and continuing through December 31 of such calendar year.
	 
	1.30  	“Pre-Retirement Survivor Benefit” shall mean the benefit set forth in Article 6.
	 
	1.31  	“Quarterly Installment Method” shall mean quarterly installment payments over the number of
quarters selected by the Participant in accordance with this Plan, calculated as follows: the
vested Account Balance of the Participant shall be calculated as of the close of business on
the last business day of the calendar quarter in which the Participant becomes entitled to a
quarterly installment payment under this Plan. The quarterly installment shall be calculated
by multiplying this balance by a fraction, the numerator of which is one, and the denominator
of which is the remaining number of quarterly payments due the Participant. By way of
example, if the Participant elects 40 quarters, the first payment shall be 1/40 of the vested
Account Balance, calculated as described in this definition. For the following calendar
quarter, the payment shall be 1/39 of the vested Account Balance, calculated as described in
this definition.
	 
	1.32  	“Retirement”, “Retire(s)” or “Retired” shall mean, with respect to an Employee, separation of
service from all Employers for any reason other than an authorized leave of absence, death or
Disability on or after the earlier of the attainment of (a) age sixty-five (65) or (b) age
fifty-five (55) with ten (10) Years of Service.
	 
	1.33  	“Retirement Benefit” shall mean the benefit set forth in Article 5.
1.34 “Short-Term Payout” shall mean the payout set forth in Section 4.1.
1.35 “Termination Benefit” shall mean the benefit set forth in Article 7.
	 
	1.36  	“Termination of Employment” shall mean the separation of service with all Employers,
voluntarily or involuntarily, for any reason other than Retirement, Disability, death or an
authorized leave of absence.
	 
	1.37  	“Transfer Account” shall mean the sum of (a) and (b) less (c):

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	 	(a)  	The amount credited to this Plan pursuant to Section 3.5.
	 
	 	(b)  	Amounts credited or debited in accordance with all applicable crediting
provisions of this Plan that relate to the Participant’s Transfer Account.
	 
	 	(c)  	All distributions made to the Participant or the Participant’s Beneficiary
pursuant to this Plan that relate to the Participant’s Transfer Account.

	1.38  	“Trust” shall mean one or more trusts established in accordance with Section 15.1.
	 
	1.39  	“Unforeseeable Financial Emergency” shall mean severe financial hardship to a Participant
resulting from an illness or accident of the Participant, the Participant’s spouse, or a
dependent (as defined in Section 152(a) of the Code) of the Participant, loss of the
Participant’s property due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Participant, as
determined in the sole discretion of the Committee consistent with Code Section 409A.
	 
	1.40  	“Years of Service” shall mean the total number of full years of employment in which a
Participant has been employed by one or more Employers. For purposes of this definition, a
year of employment shall be a 365 day period (or 366 day period in the case of a leap year)
that, for the first year of employment, commences on the Employee’s date of hiring and that,
for any subsequent year, commences on an anniversary of that hiring date. Any partial year of
employment shall not be counted.
	 
	1.41  	“Year of Vesting Service” shall mean a full year of employment in which a Participant has
been employed by one or more Employers. For purposes of this definition, a year of employment
shall be a 365 day period (or 366 day period in the case of a leap year).

ARTICLE 2

Selection, Enrollment, Eligibility

	2.1  	Selection by Committee. Participation in the Plan shall be limited to a select group
of management and highly compensated Employees, as determined by the Committee in its sole
discretion. From that group, the Committee shall select, in its sole discretion, Employees to
participate in the Plan, who upon selection become eligible to participate in the Plan.
Notwithstanding the foregoing, an Employee cannot be selected to participant in the Plan until
the Employee has been employed with an Employer for at least 90 days.
	 
	2.2  	Enrollment Requirements. As a condition to participation, each selected Employee
shall complete, execute and return to the Committee a Plan Agreement, an Election Form and a
Beneficiary Designation Form, all within 30 days after the Employee becomes eligible to
participate in the Plan. In addition, the Committee shall establish from time to time such
other enrollment requirements as it determines in its sole discretion are necessary.
	 
	2.3  	Eligibility; Commencement of Participation. Subject to the next sentence, an
Employee shall commence participation in the Plan as of the first day of the calendar quarter following the calendar quarter in which the
Committee selects that Employee to participate in the Plan in accordance with Section 2.1
(the “First Day of the Quarter”). However, if the Employee fails to

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	   	meet the requirements
of Section 2.2, that Employee shall not be eligible to participate in the Plan until the
first day of the Plan Year following the delivery to and acceptance by the Committee of the
required documents. If an Employee meets the requirements of Section 2.2 within the time
period prescribed within that Section, but the Employee’s enrollment materials are not
received by the Company until after the First Day of the Quarter, the Employee shall
commence participation as of the first payroll period that follows the Company’s receipt of
the Employee’s enrollment materials.
	 
	2.4  	Termination of Participation and/or Deferrals. If the Committee determines in good
faith that a Participant no longer qualifies as a member of a select group of management or
highly compensated employees, as membership in such group is determined in accordance with
Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, the Committee shall have the right, in its
sole discretion, to (i) terminate any deferral election the Participant has made for the
remainder of the Plan Year in which the Participant’s membership status changes, (ii) prevent
the Participant from making future deferral elections and/or (iii) immediately distribute the
Participant’s then vested Account Balance as a Termination Benefit and terminate the
Participant’s participation in the Plan. The payment of any amount under this Section 2.4
shall be subject to the Deduction Limitation. Notwithstanding the foregoing, the Committee
shall interpret this Section in a manner that is consistent with Code Section 409A and the
regulations thereunder, including without limitation guidance issued in connection with that
Section.

ARTICLE 3

Deferral Commitments/Company Contribution/Company Matching/Crediting/Taxes

	3.1  	Minimum Deferrals. For each Plan Year, a Participant may elect to defer, as the
Participant’s Annual Deferral Amount, Base Annual Salary and/or Bonus in the following minimum
percentages for each deferral elected:

	 	 	 	 	 	 	 	 
	 
	 	Deferral	 	 	Minimum Amount	 	 
	 	Base Annual Salary
	 	 	 	2.5	%	 
	 	Bonus
	 	 	 	2.5	%	 
	 

	   	If an election is made for less than the stated minimum amounts, or if no election is made,
the amount deferred shall be zero.
	 
	3.2  	Maximum Deferrals. For each Plan Year, a Participant may elect to defer, as the
Participant’s Annual Deferral Amount, Base Annual Salary and/or Bonus up to the following
maximum percentages for each deferral elected:

	 	 	 	 	 	 	 	 
	 
	 	Deferral	 	 	Maximum Amount	 	 
	 	Base Annual Salary
	 	 	 	50	%	 
	 	Bonus
	 	 	 	75	%	 
	 

	   	Notwithstanding the foregoing, if a Participant first becomes a Participant after the first
day of a Plan Year, the maximum Annual Deferral Amount, with respect to Base Annual Salary
and

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	   	Bonus, shall be limited to the amount of such compensation earned by the Participant
after the Participant commences participation in the Plan in accordance with Section 2.3
above. .
	 
	3.3  	Election to Defer; Effect of Election Form.

	 	(a)  	First Plan Year. In connection with a Participant’s commencement of
participation in the Plan, the Participant shall make an irrevocable deferral election
for the Plan Year in which the Participant commences participation in the Plan, along
with such other elections as the Committee deems necessary or desirable under the Plan.
For these elections to be valid, the Election Form must be completed and signed by the
Participant, timely delivered to the Committee (in accordance with Section 2.2) and
accepted by the Committee.
	 
	 	(b)  	Subsequent Plan Years. For each succeeding Plan Year, an irrevocable
deferral election for that Plan Year, and such other elections as the Committee deems
necessary or desirable under the Plan, shall be made by timely delivering to the
Committee, in accordance with its rules and procedures, before the end of the Plan Year
preceding the Plan Year for which the election is made (or such earlier time as the
Committee may establish, in its sole discretion), a new Election Form. If no such
Election Form is timely delivered for a Plan Year, the Annual Deferral Amount shall be
zero for that Plan Year.
	 
	 	(c)  	Performance-Based Compensation. Notwithstanding the foregoing, the
Committee may, in its sole discretion, determine that an irrevocable deferral election
pertaining to performance-based compensation may be made by timely delivering a new
Election Form to the Committee, in accordance with its rules and procedures, no later
than six (6) months before the end of the performance service period.
“Performance-based compensation” shall be compensation based on services performed over
a period of at least twelve (12) months, in accordance with Code Section 409A and
related guidance.

	3.4  	Withholding of Annual Deferral Amounts. For each Plan Year, the Base Annual Salary
portion of the Annual Deferral Amount shall be withheld from each regularly scheduled Base
Annual Salary payroll in the percentage elected by the Participant. The Bonus portion of the
Annual Deferral Amount shall be withheld at the time the Bonus is paid to the Participant.
	 
	3.5  	Transfer Account. If at the time of a Participant’s commencement of Participation in
this Plan, the Participant had an “Account” under that certain MGM Grand Hotel, Inc.
Nonqualified Deferred Retirement Plan, restated effective January 1, 1999 (the “NDRP”), and
that balance was not previously transferred to the MGM MIRAGE Deferred Compensation Plan,
effective January 1, 2000 (“Prior DCP”), the Participant’s balance in that Account shall
automatically be transferred to this Plan and shall be credited to the Participant’s Transfer
Account as of the first day of the Participant’s participation in this Plan.
Upon such transfer, this Plan, rather than the NDRP, shall govern the amount so transferred.
Notwithstanding the foregoing, the Committee shall interpret this Section in a manner that
is consistent with Code Section 409A and the regulations thereunder, including without
limitation guidance issued in connection with that Section.

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	3.6  	Annual Company Matching Amount. To be eligible for an Annual Company Matching Amount
for a Plan Year, a Participant must elect to defer for that Plan Year at least the minimum
Base Annual Salary or Bonus set forth in Section 3.1 above. Subject to making such election,
a Participant’s Annual Company Matching Amount for any Plan Year shall be equal to 100% of the
sum of (i) the Participant’s Annual Deferral Amount for such Plan Year and (ii) the
Participant’s deferrals under the 401(k) Savings Plan for such Plan Year, up to a combined
amount that does not exceed 4% of the Participant’s annual base salary earned at the end of
the Plan Year, as determined by the Committee in its sole discretion, reduced by the amount of
any matching contributions made to the 401(k) Savings Plan on the Participant’s behalf for the
plan year of the 401(k) Savings Plan that corresponds to the Plan Year. This amount shall be
credited to the Participant’s Company Matching Account as soon as is administratively
practical after the end of the Plan Year to which the Annual Company Matching Amount relates.
If a Participant is not employed by an Employer as of the last day of a Plan Year other than
by reason of the Participant’s Retirement, Disability or death, the Annual Company Matching
Amount for such Plan Year shall be zero. In the event of Retirement, Disability or death, a
Participant shall be credited with the Annual Company Matching Amount for the Plan Year in
which the Participant Retires, suffers a Disability or dies as soon as is administratively
practical after the time of the Participant’s Retirement, Disability or death.
	 
	3.7  	Vesting.

	 	(a)  	A Participant shall at all times be 100% vested in the Participant’s Deferral
Account and Transfer Account.
	 
	 	(b)  	A Participant shall vest in 33 1/3% of each Annual Company Matching Amount,
plus earnings thereon, at the end of each 3 consecutive Plan Years, starting with the
Plan Year to which the match relates, provided that the Participant is continuously
employed with an Employer at the end of each such Plan Year. If not so continuously
employed, the Participant shall vest, if at all, to the extent that the Participant was
so employed at the end of the applicable Plan Year.
	 
	 	(c)  	Notwithstanding anything to the contrary contained in this Section 3.7, in the
event of a Change in Control or a Participant’s death, Disability or Retirement, a
Participant’s Company Contribution Account and Company Matching Account shall
immediately become 100% vested (if it is not already vested in accordance with the
above vesting schedules).
	 
	 	(d)  	Notwithstanding subsection (c), the vesting schedule for a Participant’s
Company Contribution Account and Company Matching Account shall not be accelerated to
the extent that the Committee determines that such acceleration would cause the
deduction limitations of Section 280G of the Code to become effective. In the event
that all of a Participant’s Company Contribution Account and/or Company Matching
Account are not
vested pursuant to such a determination, the Participant may request independent
verification of the Committee’s calculations with respect to the application of
Section 280G. In such case, the Committee must provide to the Participant within 15
business days of such a request an opinion from a nationally recognized accounting
firm selected

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	 	   	by the Participant (the “Accounting Firm”). The opinion shall state
the Accounting Firm’s opinion that any limitation on the vested percentage hereunder
is necessary to avoid the limits of Section 280G and contain supporting calculations.
The reasonable cost of such opinion shall be paid for by the Company.
	 
	 	(e)  	Any amount not vested under this Section 3.7 when a Participant first becomes
entitled to the payment of a benefit under this Plan shall be forfeited and debited
against the applicable Account Balance.

	3.8  	Crediting/Debiting of Account Balances. In accordance with, and subject to, the
rules and procedures that are established from time to time by the Committee, in its sole
discretion, amounts shall be credited or debited to a Participant’s Account Balance in
accordance with the following rules:

	 	(a)  	Election of Measurement Funds. A Participant, in connection with the
Participant’s initial deferral election in accordance with Section 3.3(a), shall elect,
on the Election Form, one or more Measurement Fund(s) (as described in Section 3.8(c))
to be used to determine the additional amounts to be credited or debited to the
Participant’s Account Balance. A Participant may (but is not required to) elect to add
or delete one or more available Measurement Fund(s) to be used to determine the
additional amounts to be credited or debited to the Participant’s Account Balance, or
to change the portion of the Participant’s Account Balance allocated to each previously
or newly elected Measurement Fund. A Participant may elect to make such a change by
submitting an Election Form, whether written or electronic (as determined by the
Committee from time to time and in its sole discretion), to the Committee. Any
election so made and accepted by the Committee shall apply no later than the third
business day following the Committee’s acceptance of the election. Any such election
shall continue to apply, unless subsequently changed in accordance with this Section
3.3(a).
	 
	 	(b)  	Proportionate Allocation. In making any election described in Section
3.8(a), the Participant shall specify on the Election Form, in increments of one
percentage point (1%), the percentage of the Participant’s Account Balance to be
allocated to a Measurement Fund (as if the Participant were making an investment in
that Measurement Fund with that portion of the Participant’s Account Balance).
	 
	 	(c)  	Measurement Funds. A Participant may elect one or more measurement
funds (the “Measurement Funds”) from among those selected by the Committee for the
purpose of crediting or debiting additional amounts to the Participant’s Account
Balance. As necessary, the Committee may, in its sole discretion, discontinue,
substitute or add Measurement Funds. Each such action will take effect as of the first
day of the calendar quarter that follows by thirty (30) days or more the day on which
the Committee gives Participants advance written notice of such change. In selecting
the Measurement Funds
that are available from time to time, neither the Committee nor any Employer shall be
liable to any Participant for such selection or adding, deleting or continuing any
available Measurement Fund.

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	 	(d)  	Crediting or Debiting Method. The performance of each elected
Measurement Fund (either positive or negative) will be reasonably determined by the
Committee. A Participant’s Account Balance shall be credited or debited on a daily
basis based on the performance of each Measurement Fund selected by the Participant.
	 
	 	(e)  	No Actual Investment. Notwithstanding any other provision of this Plan
that may be interpreted to the contrary, the Measurement Funds are to be used for
measurement purposes only, and a Participant’s election of any such Measurement Fund,
the allocation to the Participant’s Account Balance thereof, the calculation of
additional amounts and the crediting or debiting of such amounts to a Participant’s
Account Balance shall not be considered or construed in any manner as
an actual investment of the Participant’s Account Balance in any such Measurement Fund.
In the event that the Company or the Trustee (as that term is defined in the Trust),
in its sole discretion, decides to invest funds in any or all of the Measurement Funds,
no Participant shall have any rights in or to such investments themselves. Without
limiting the foregoing, a Participant’s Account Balance shall at all times be a
bookkeeping entry only and shall not represent any investment made on the Participant’s
behalf by the Company or the Trust; and the Participant shall at all times remain an
unsecured creditor of the Company.
	 
	 	(f)  	Employer Discretion. Notwithstanding the foregoing provisions of this
Section 3.8, the Committee shall retain the overriding discretion regarding the
Participant’s designation of Measurement Funds under this Section 3.8. If a
Participant fails to designate any Measurement Fund under this Section 3.8, the
Participant shall be deemed to have elected the money market fund, or such other fund
as determined from time to time by the Committee in its sole discretion.
	 
	 	(g)  	Selection Results. The Participant shall bear full responsibility for
all results associated with the Participant’s selection of Measurement Funds under this
Section 3.8, and the Employers shall have no responsibility or liability with respect
to the Participant’s selection of such Measurement Funds.

	3.9  	FICA and Other Taxes.

	 	(a)  	Annual Deferral Amounts. For each Plan Year in which an Annual
Deferral Amount is being withheld from a Participant, the Participant’s Employer(s)
shall withhold from that portion of the Participant’s Base Annual Salary and Bonus that
is not being deferred, in a manner determined by the Employer(s), the Participant’s
share of FICA and other employment taxes on such Annual Deferral Amount. If necessary,
the Committee may reduce the Annual Deferral Amount in order to comply with this
Section 3.9.
	 
	 	(b)  	Company Contribution Amounts and Company Matching Amounts. When a
Participant becomes vested in any Annual Company Contribution Amount and/or Annual
Company Matching Amount, plus earnings thereon, the Participant’s Employer(s) shall
withhold from the Participant’s Base Annual Salary and/or Bonus that is not deferred,
in a manner determined by the Employer(s), the Participant’s share of FICA and other
employment taxes. If necessary, the Committee may reduce the vested portion of the

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	 	   	Participant’s Company Contribution Account and/or Company Matching Account in order
to comply with this Section 3.9.
	 
	 	(c)  	Distributions. The Participant’s Employer(s), or the Trustee of the
Trust, shall withhold from any payments made to a Participant under this Plan all
federal, state and local income, employment and other taxes required to be withheld by
the Employer(s), or the Trustee of the Trust, in connection with such payments, in
amounts and in a manner to be determined in good faith in the sole discretion of the
Employer(s) and the Trustee of the Trust.

ARTICLE 4

Short-Term Payout; Unforeseeable Financial Emergencies;

Withdrawal Election

	4.1  	Short-Term Payout. In connection with each election to defer an Annual Deferral
Amount, a Participant may irrevocably elect to receive a future “Short-Term Payout” from the
Plan with respect to such Annual Deferral Amount. Subject to the Deduction Limitation, the
Short-Term Payout shall be a lump sum payment in an amount that is equal to the Annual
Deferral Amount plus amounts credited or debited in the manner provided in Section 3.8 above
on that amount, determined at the time that the Short-Term Payout becomes payable. Subject to
the Deduction Limitation and the other terms and conditions of this Plan, each Short-Term
Payout elected shall be paid out during a 60 day period commencing immediately after the last
day of any Plan Year designated by the Participant that is at least five Plan Years after the
Plan Year in which the Annual Deferral Amount is actually deferred. By way of example, if a
five-year Short-Term Payout is elected for Annual Deferral Amounts that are deferred in the
Plan Year commencing January 1, 2005, the five-year Short-Term Payout would become payable
during a 60 day period commencing January 1, 2011.
	 
	   	A Participant may make a one time election to postpone a Short-Term Payout described above,
and have such amount paid out during a sixty (60) day period commencing immediately after an
allowable alternative distribution date designated by the Participant in accordance with the
following rules. To make this one time election, the Participant must submit a new Election
Form to the Committee in accordance with the following criteria: (i) the Election Form is
submitted at least 1 year prior to the schedule distribution date of the Short-Term Payout,
(ii) the election cannot take effect until at least 12 months after the date on which the
election is made, (iii), the first payment with respect to which such election is made must
be deferred for a period of 5 years from the date such payment would otherwise have been
made, (iv) the election cannot accelerate the payment of such benefit and (v) the election
is accepted by the Committee in its sole discretion.
	 
	4.2  	Other Benefits Take Precedence Over Short-Term. Should an event occur that triggers
a benefit under Article 5, 6, 7 or 8, any Annual Deferral Amount, plus amounts credited or
debited thereon, that is subject to a Short-Term Payout election under Section 4.1 shall not
be paid in accordance with Section 4.1 but shall be paid in accordance with the other
applicable Article. Notwithstanding the foregoing, the Committee shall interpret this Section
in a manner that is

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	   	consistent with Code Section 409A and the regulations thereunder,
including without limitation guidance issued in connection with that Section.
	 
	4.3  	Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies. If the
Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the
Committee to (i) suspend any deferrals required to be made by a Participant during the
remaining portion of the Plan Year and/or (ii) receive a partial or full payout from the Plan.
The payout shall not exceed the lesser of the Participant’s vested Account Balance,
calculated as if such Participant were receiving a Termination Benefit, or the amount
necessary to satisfy the Unforeseeable Financial Emergency plus amounts necessary to pay taxes
reasonably anticipated as a result of the distribution, after taking into account the extent
to which such hardship is or may be relieved through reimbursement or compensation by
insurance or otherwise or by liquidation of the participant’s assets (to the extent the
liquidation of such assets would not itself cause severe financial hardship). . If, in the
sole discretion of the Committee, the petition for a suspension and/or payout is approved,
suspension shall take effect upon the date of approval and any payout shall be made within 60
days of the date of approval. The payment of any amount under this Section 4.3 shall be
subject to the Deduction Limitation.

ARTICLE 5

Retirement Benefit

	5.1  	Retirement Benefit. Subject to the Deduction Limitation, a Participant who Retires
shall receive, as a Retirement Benefit, the Participant’s vested Account Balance.
	 
	5.2  	Payment of Retirement Benefit. A Participant, in connection with the Participant’s
commencement of participation in the Plan, will elect on an Election Form to receive the
Retirement Benefit in a lump sum or in installments of up to 60 quarters pursuant to the
Quarterly Installment Method. The Participant may change the Participant’s election once to
an allowable alternative payout period by submitting a new Election Form to the Committee,
provided that (i) the election cannot take effect until at least 12 months after the date on
which the election is made, (ii), the payment with respect to which such election is made must
be deferred for a period of 5 years from the date such payment would otherwise have been made,
(iii) the election cannot accelerate the payment of such benefit and (iv) the election is
accepted by the Committee in its sole discretion. . Subject to the prior sentence, the
Election Form most recently accepted by the Committee shall govern the payout of the
Retirement Benefit. If a Participant does not make any election with respect to the payment
of the Retirement Benefit, then such benefit shall be payable in a lump sum. The lump sum
payment shall be made, or installment payments shall commence, no earlier than six months
after the Participant’s Retirement and no later than 60 days after that six month
anniversary. . Any payment made shall be subject to the Deduction Limitation.
	 
	5.3  	Death Prior to Completion of Retirement Benefit. If a Participant dies after
Retirement but before the Retirement Benefit is paid in full, the Participant’s unpaid
Retirement Benefit payments shall continue and shall be paid to the Participant’s Beneficiary
(a) over the remaining number of quarters and in the same amounts as that benefit would have
been paid to the

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	   	Participant had the Participant survived, or (b) in a lump sum, if requested
by the Beneficiary and if allowed under Code Section 409A and the regulations thereunder, as
determined in the sole discretion of the Committee, that is equal to the Participant’s unpaid
remaining vested Account Balance.

ARTICLE 6

Pre-Retirement Survivor Benefit

	6.1  	Pre-Retirement Survivor Benefit. Subject to the Deduction Limitation, the
Participant’s Beneficiary shall receive a Pre-Retirement Survivor Benefit equal to the
Participant’s vested Account Balance if the Participant dies before the Participant Retires,
experiences a Termination of Employment or suffers a Disability.
	 
	6.2  	Payment of Pre-Retirement Survivor Benefit. A Participant, in connection with the
Participant’s commencement of participation in the Plan, will elect on an Election Form
whether the Pre-Retirement Survivor Benefit shall be received by the Participant’s Beneficiary
in a lump sum or in installments of up to 60 quarters pursuant to the Quarterly Installment
Method. The Participant may change this election once to an allowable alternative payout
period by submitting a new Election Form to the Committee, provided that (i) the election
cannot take effect until at least 12 months after the date on which the election is made, (ii)
the election cannot accelerate the payment of such benefit and (iii) the election is accepted
by the Committee in its sole discretion. Subject to the prior sentence, the Election Form
most recently accepted by the Committee prior to the Participant’s death shall govern the
payout of the Participant’s Pre-Retirement Survivor Benefit. If a Participant does not make
any election with respect to the payment of the Pre-Retirement Survivor Benefit, then such
benefit shall be paid in a lump sum. Despite the foregoing, if the Participant’s vested
Account Balance at the time of the Participant’s death is less than $25,000 and if allowed
under Code Section 409A and the regulations thereunder, as determined in the sole discretion
of the Committee, payment of the Pre-Retirement Survivor Benefit may be made, in the sole
discretion of the Committee, in a lump sum or in installments of up to 20 quarters pursuant to
the Quarterly Installment Method. The lump sum payment shall be made, or installment payments
shall commence, no later than 60 days after the last day of the calendar quarter in which the
Committee is provided with proof that is satisfactory to the Committee of the Participant’s
death. Any payment made shall be subject to the Deduction Limitation.

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ARTICLE 7

Termination Benefit

	7.1  	Termination Benefit. Subject to the Deduction Limitation, the Participant shall
receive a Termination Benefit, which shall be equal to the Participant’s vested Account
Balance if a Participant experiences a Termination of Employment prior to the Participant’s
Retirement, death or Disability.
	 
	7.2  	Payment of Termination Benefit. A Participant, in connection with the Participant’s
commencement of participation in the Plan, will elect on an Election Form to receive the
Termination Benefit in a lump sum or in installments of up to 20 quarters pursuant to the
Quarterly Installment Method. The Participant may change the Participant’s election once to
an allowable alternative payout period by submitting a new Election Form to the Committee,
provided that (i) the election cannot take effect until at least 12 months after the date on
which the election is made, (ii), the payment with respect to which such election is made must
be deferred for a period of 5 years from the date such payment would otherwise have been made,
(iii) the election cannot accelerate the payment of such benefit and (iv) the election is
accepted by the Committee in its sole discretion. Subject to the prior sentence, the Election
Form most recently accepted by the Committee shall govern the payout of the Termination
Benefit. If a Participant does not make any election with respect to the payment of the
Termination Benefit, then such benefit shall be payable in a lump sum. The lump sum payment
shall be made, or installment payments shall commence, no earlier than six months after the
Participant’s Termination of Employment and no later than 60 days after that six month
anniversary.. Any payment made shall be subject to the Deduction Limitation.
	 
	7.3  	Death Prior to Completion of Termination Benefit. If a Participant dies after
Termination of Employment but before the Termination Benefit is paid in full, the
Participant’s unpaid Termination Benefit payments shall continue and shall be paid to the
Participant’s Beneficiary (a) over the remaining number of quarters and in the same amounts as
that benefit would have been paid to the Participant had the Participant survived, or (b) in a
lump sum, if requested by the Beneficiary and if allowed under Code Section 409A and the
regulations thereunder, as determined in the sole discretion of the Committee, that is equal
to the Participant’s unpaid remaining vested Account Balance.

ARTICLE 8

Disability Waiver and Benefit

	8.1  	Disability Waiver.

	 	(a)  	Waiver of Deferral. A Participant who is determined by the Committee
to be suffering from a Disability shall be excused from fulfilling that portion of the
Annual Deferral Amount commitment that would otherwise have been withheld from a
Participant’s Base Annual Salary and/or Bonus for the Plan Year during which the
Participant first suffers a Disability. During the period of Disability, the
Participant shall not be allowed to make any additional deferral elections, but will
continue to be considered a Participant for all

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	 	   	other purposes of this Plan. Notwithstanding the foregoing, the Committee shall
interpret this Section in a manner that is consistent with Code Section 409A and the
regulations thereunder, including without limitation guidance issued in connection
with that Section.
	 
	 	(b)  	Return to Work. If a Participant returns to employment with an
Employer after a Disability ceases, the Participant may elect to defer an Annual
Deferral Amount for the Plan Year following the Participant’s return to employment or
service and for every Plan Year thereafter while a Participant in the Plan; provided
such deferral elections are otherwise allowed and an Election Form is delivered to and
accepted by the Committee for each such election in accordance with Section 3.3.

	8.2  	Continued Eligibility; Disability Benefit. A Participant suffering a Disability
shall, for benefit purposes under this Plan, continue to be considered to be employed and
shall be eligible for the benefits provided for in Article 4, 5, 6 or 7 in accordance with the
provisions of those Articles. Notwithstanding the above, subject to Code Section 409A and the
regulations thereunder, as determined in the sole discretion of the Committee, the Committee
shall have the right to, in its sole and absolute discretion and for purposes of this Plan
only, and must in the case of a Participant who is otherwise eligible to Retire, deem the
Participant to have experienced a Termination of Employment, or in the case of a Participant
who is eligible to Retire, to have Retired, at any time (or in the case of a Participant who
is eligible to Retire, as soon as practicable) after such Participant is determined to be
suffering a Disability, in which case the Participant shall receive a Disability Benefit equal
to the Participant’s vested Account Balance at the time of the Committee’s determination;
provided, however, that should the Participant otherwise have been eligible to Retire, the
Participant shall be paid in accordance with Article 5. The Disability Benefit shall be paid
in a lump sum within 60 days of the Committee’s exercise of such right, provided that, and to
the extent required by Code Section 409A and the regulations thereunder, if any such payment
would otherwise be paid within six months of the Participant’s Retirement or Termination of
Employment, any such payment shall not be paid until after the end of such six month period
Any payment made shall be subject to the Deduction Limitation.

ARTICLE 9

Beneficiary Designation

	9.1  	Beneficiary. Each Participant shall have the right, at any time, to designate the
Participant’s Beneficiary(ies) (both primary as well as contingent) to receive any benefits
payable under the Plan to a beneficiary upon the death of a Participant or the death of a
predecessor Beneficiary receiving benefits under the Plan. The Beneficiary designated under
this Plan may be the same as or different from the Beneficiary designation under any other
plan of an Employer in which the Participant participates.

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	9.2  	Beneficiary Designation; Change; Spousal Consent. A Participant shall designate the
Participant’s Beneficiary by completing and signing the Beneficiary Designation Form, and
returning it to the Committee or its designated agent. A Participant shall have the right to
change a Beneficiary by completing, signing and otherwise complying with the terms of the
Beneficiary Designation Form and the Committee’s rules and procedures, as in effect from time
to time. If a married Participant names someone other than the Participant’s spouse as a
primary Beneficiary, a spousal consent, in the form designated by the Committee, must be
signed by that Participant’s spouse and returned to the Committee. Upon the acceptance by the
Committee of a new Beneficiary Designation Form, all Beneficiary designations previously filed
shall be canceled. The Committee shall be entitled to rely on the last Beneficiary
Designation Form filed by the Participant and accepted by the Committee prior to the
Participant’s death.
	 
	9.3  	Acknowledgment. No designation or change in designation of a Beneficiary shall be
effective until received and acknowledged in writing by the Committee or its designated agent.
	 
	9.4  	No Beneficiary Designation. If a Participant fails to designate a Beneficiary as
provided in Sections 9.1, 9.2 and 9.3 or, if all designated Beneficiaries predecease the
Participant or die prior to complete distribution of the Participant’s benefits, then the
Participant’s designated Beneficiary shall be deemed to be the Participant’s surviving spouse.
If the Participant has no surviving spouse, the benefits remaining under the Plan to be paid
to a Beneficiary shall be payable to the executor or personal representative of the
Participant’s estate.
	 
	9.5  	Doubt as to Beneficiary. If the Committee has any doubt as to the proper Beneficiary
to receive payments pursuant to this Plan, the Committee shall have the right, exercisable in
its discretion, to cause the Participant’s Employer to withhold such payments until this
matter is resolved to the Committee’s satisfaction.
	 
	9.6  	Discharge of Obligations. The payment of benefits under the Plan to a Beneficiary
shall fully and completely discharge all Employers and the Committee from all further
obligations under this Plan with respect to the Participant, and that Participant’s Plan
Agreement shall terminate upon such full payment of benefits.

ARTICLE 10

Leave of Absence

	10.1  	Paid Leave of Absence. If a Participant is authorized by the Participant’s Employer
for any reason to take a paid leave of absence from the employment of the Employer, the
Participant shall continue to be considered employed by the Employer and the Annual Deferral
Amount shall continue to be withheld during such paid leave of absence in accordance with
Section 3.3.
	 
	10.2  	Unpaid Leave of Absence. If a Participant is authorized by the Participant’s
Employer for any reason to take an unpaid leave of absence from
the employment of the Employer, the Participant shall continue to be considered employed by
the Employer and the Participant shall be excused from making deferrals until the
Participant returns to a paid employment status. Upon such return, deferrals shall resume
for the remaining portion of the Plan Year in which the return

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	   	occurs, based on the deferral
election, if any, made for that Plan Year. If no election was made for that Plan Year, no
deferral shall be withheld.

ARTICLE 11

Termination, Amendment or Modification

	11.1  	Termination. Although each Employer anticipates that it will continue the Plan for
an indefinite period of time, there is no guarantee that any Employer will continue the Plan
or will not terminate the Plan at any time in the future. Accordingly, each Employer reserves
the right, in its sole discretion, to discontinue its sponsorship of the Plan and/or to
terminate the Plan at any time with respect to any or all of its participating Employees by
action of its board of directors. Following a Termination of the Plan, Participant Account
Balances shall remain in the Plan until the Participant becomes eligible for the benefits
provided in Articles 4, 5, 6, 7, or 8 in accordance with the provisions of those Articles.
The Termination of the Plan shall not adversely affect any Participant or Beneficiary who has
become entitled to the payment of any benefits under the Plan as of the date of termination.
Despite the foregoing, if allowed under Code Section 409A and the regulations thereunder, as
determined in the sole discretion of the Committee, distributions under the following
sentences will be applicable to the extent so allowed. Upon the termination of the Plan with
respect to any Employer, the Plan Agreements of the affected Participants who are employed by
that Employer shall terminate and their vested Account Balances, determined as if they had
experienced a Termination of Employment on the date of Plan termination or, if Plan
termination occurs after the date upon which a Participant was eligible to Retire, then with
respect to that Participant as if the Participant had Retired on the date of Plan termination,
shall be paid to the Participants as follows: Prior to a Change in Control, if the Plan is
terminated with respect to all of its Participants, an Employer shall have the right, in its
sole discretion, and notwithstanding any elections made by the Participant, to pay such
benefits in a lump sum or in installments of up to 60 quarters pursuant to the Quarterly
Installment Method, with amounts credited and debited during the installment period as
provided herein. If the Plan is terminated with respect to less than all of its Participants,
an Employer shall be required to pay such benefits in a lump sum. After a Change in Control,
the Employer shall be required to pay such benefits in a lump sum.
	 
	11.2  	Amendment. The Committee may, at any time in its sole discretion, amend or modify
the Plan in whole or in part with respect to any Employer; provided, however, that: (i) no
amendment or modification shall be effective to decrease or restrict the value of a
Participant’s vested Account Balance in existence at the time the amendment or modification is
made, calculated as if the Participant had experienced a Termination of Employment as of the
effective date of the amendment or modification or, if the amendment or modification occurs
after the date upon which the Participant was eligible to Retire, the Participant had Retired
as of the effective date of the amendment or modification, and (ii) no amendment or
modification of this Section 11.2 shall be effective. The amendment or
modification of the Plan shall not affect any Participant or Beneficiary who has become
entitled to the payment of benefits under the Plan as of the date of the amendment or
modification; provided, however, that the Committee shall have the right in its sole
discretion, if allowed under Code Section 409A and the regulations thereunder, to accelerate

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	   	installment payments by paying the vested Account Balance in a lump sum or in installments
using fewer quarters pursuant to the Quarterly Installment Method.
	 
	11.3  	Plan Agreement. Despite the provisions of Section 11.1 and 11.2, if a Participant’s
Plan Agreement contains benefits or limitations that are not in this Plan document, the
Employer may only amend or terminate such provisions with the consent of the Participant.
	 
	11.4  	Effect of Payment. The full payment of the applicable benefit under Article 4, 5, 6,
7 or 8 of the Plan shall completely discharge all obligations to a Participant and the
Participant’s designated Beneficiary under this Plan and the Participant’s Plan Agreement
shall terminate.

ARTICLE 12

Administration

	12.1  	Committee Duties. Except as otherwise provided in this Article 12, this Plan shall
be administered by a Committee which shall consist of the Board, or such committee as the
Board shall appoint from time to time. Members of the Committee may be Participants under
this Plan and need not be members of the Board. The Committee shall also have the discretion
and authority to (i) make, amend, interpret, and enforce all appropriate rules and regulations
for the administration of this Plan and the governance of the Committee and (ii) decide or
resolve any and all questions, including interpretations of this Plan, as may arise in
connection with the Plan. Any individual serving on the Committee who is a Participant shall
not vote or act on any matter relating solely to himself or herself. When making a
determination or calculation, the Committee shall be entitled to rely on information furnished
by a Participant or the Company.
	 
	12.2  	Agents. In the administration of this Plan, the Committee may, from time to time,
employ agents and delegate to them such administrative duties as it sees fit (including acting
through a duly appointed representative) and may from time to time consult with counsel who
may be counsel to any Employer. The Company shall pay all expenses of such agents.
	 
	12.3  	Binding Effect of Decisions. The decision or action of the Committee with respect to
any question arising out of or in connection with the administration, interpretation or
application of the Plan and the rules and regulations promulgated hereunder shall be final and
conclusive and binding upon all persons having any interest in the Plan.
	 
	12.4  	Indemnity of Committee. All Employers shall indemnify, defend and hold harmless each
member of the Committee, and any Employee to whom the duties of the Committee may be
delegated, against any and all claims, losses, damages,
expenses or liabilities, including reasonable attorneys’ fees and court costs, arising from
any action or failure to act with respect to this Plan, except in the case of willful
misconduct by such member of the Committee or such Employee.
	 
	12.5  	Employer Information. To enable the Committee to perform its functions, the Company
and each Employer shall supply full and timely information to the Committee on all matters
relating to the compensation of its Participants, the date and circumstances of the
Retirement, Disability,

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	   	death or Termination of Employment of its Participants, and such other
pertinent information as the Committee may reasonably require.

ARTICLE 13

Other Benefits and Agreements

	13.1  	Coordination with Other Benefits. The benefits provided for a Participant and
Participant’s Beneficiary under the Plan are in addition to any other benefits available to
such Participant under any other plan or program for employees of the Participant’s Employer.
The Plan shall supplement and shall not supersede, modify or amend any other such plan or
program except as may otherwise be expressly provided.

ARTICLE 14

Claims Procedures

	14.1  	Presentation of Claim. Any Participant or Beneficiary of a deceased Participant
(such Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the
Committee a written claim for a determination with respect to the amounts distributable to
such Claimant from the Plan. If such a claim relates to the contents of a notice received by
the Claimant, the claim must be made within 60 days after such notice was received by the
Claimant. All other claims must be made within 180 days of the date on which the event that
caused the claim to arise occurred. The claim must state with particularity the determination
desired by the Claimant.
	 
	14.2  	Notification of Decision. The Committee shall consider a Claimant’s claim within a
reasonable time, and shall notify the Claimant in writing:

	 	(a)  	that the Claimant’s requested determination has been made, and that the claim
has been allowed in full; or
	 
	 	(b)  	that the Committee has reached a conclusion contrary, in whole or in part, to
the Claimant’s requested determination, and such notice must set forth in a manner
calculated to be understood by the Claimant:

	 	(i)  	the specific reason(s) for the denial of the claim, or any part
of it;
	 
	 	(ii)  	specific reference(s) to pertinent provisions of the Plan upon
which such denial was based;
	 
	 	(iii)  	a description of any additional material or information
necessary for the Claimant to perfect the claim, and an explanation of why such
material or information is necessary; and
	 
	 	(iv)  	an explanation of the claim review procedure set forth in Section
14.3.

	14.3  	Review of a Denied Claim. Within 60 days after receiving a notice from the Committee
that a claim has been denied, in whole or in part, a Claimant (or the Claimant’s duly
authorized representative) may file with the Committee a written request for a review of the
denial of the

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	   	claim. Thereafter, but not later than 30 days after the review procedure began,
the Claimant (or the Claimant’s duly authorized representative):

	 	(a)  	may review pertinent documents;
	 
	 	(b)  	may submit written comments or other documents; and/or
	 
	 	(c)  	may request a hearing, which the Committee, in its sole discretion, may grant.

	14.4  	Decision on Review. The Committee shall render its decision on review promptly, and
not later than 60 days after the filing of a written request for review of the denial, unless
a hearing is held or other special circumstances require additional time, in which case the
Committee’s decision must be rendered within 120 days after such date. Such decision must be
written in a manner calculated to be understood by the Claimant, and it must contain:

	 	(a)  	specific reasons for the decision;
	 
	 	(b)  	specific reference(s) to the pertinent Plan provisions upon which the decision
was based; and
	 
	 	(c)  	such other matters as the Committee deems relevant.

	14.5  	Legal Action. A Claimant’s compliance with the foregoing provisions of this Article
14 is a mandatory prerequisite to a Claimant’s right to commence any legal action with respect
to any claim for benefits under this Plan.

ARTICLE 15

Trust

	15.1  	Establishment of the Trust. The Company shall establish the Trust, with sub-trusts
for each Employer. Each Employer shall at least annually transfer over to the Trust such
assets as the Employer determines, in its sole discretion, are necessary to provide, on a
present value basis, for its respective future liabilities created with respect to the Annual
Deferral Amounts, Annual Company Contribution Amounts and Annual Company Matching Amounts for
such Employer’s Participants for all periods prior to the transfer, as well as any debits and
credits to the Participants’ Account Balances for all periods prior to the transfer, taking
into consideration the value of the assets in the trust at the time of the transfer. Such
assets shall be allocated to the respective sub-trust of each contributing Employer.
	 
	15.2  	Interrelationship of the Plan and the Trust. The provisions of the Plan and the Plan
Agreement shall govern the rights of a Participant to receive distributions pursuant to the
Plan. The provisions of the Trust shall govern the rights of the Employers, Participants and
the creditors of the Employers to the assets transferred to the Trust. Each Employer shall at
all times remain liable to carry out its obligations under the Plan with respect to its
Participants. In this regard, if a Participant has been employed by only one Employer, such
Employer shall be responsible for the total amounts credited to such Participant’s Account
Balance under this Plan. If a Participant has been employed by more than one Employer, each
Employer shall be

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	   	responsible only for the amounts credited to the Participant’s Account
Balance by such Employer.
	 
	15.3  	Distributions from the Trust. Each Employer’s obligations under the Plan may be
satisfied with Trust assets distributed pursuant to the terms of the Trust, and any such
distribution shall reduce the Employer’s obligations under this Plan.
	 
	15.4  	Investment of Trust Assets. The Trustee of the Trust shall be authorized, upon
written instructions received from the Committee or investment manager appointed by the
Committee, to invest and reinvest the assets of the Trust in accordance with the applicable
Trust Agreement.
	 
	15.5  	No Claim on Trust Assets. A Participant shall have no preferred claim on, or any
beneficial interest in, any assets of the Trust. Any assets held by the Trust shall be
subject to the claims of general creditors of each Employer that is the grantor of the Trust
under federal and state law in the event of the Employer’s “insolvency” (i.e., the Employer is
unable to pay its debts as they become due or is subject to a pending proceeding as a debtor
under the United States Bankruptcy Code), but only with respect to the assets of the Trust
held for the benefit of Participants employed or formerly employed by such Employer.

ARTICLE 16

Miscellaneous

	16.1  	Status of Plan. The Plan is intended to be a plan that is not qualified within the
meaning of Code Section 401(a) and that “is unfunded and is maintained by an employer
primarily for the purpose of providing deferred compensation for a select group of management
or highly compensated employees” within the meaning of ERISA Sections 201(2), 301(a)(3) and
401(a)(1). In addition, the Plan is intended to comply with Code Sections 409A(a)(1) to (4)
and (b)(1) to (2). The Plan shall be administered and interpreted in a manner consistent with
those foregoing intents. Should any provision of this Plan not comply the provisions of Code
Section 409A listed above, that provision shall have no affect on the remaining parts of this
Plan and this Plan shall be construed and enforced as if such provision had never been
inserted herein.
	 
	16.2  	Unsecured General Creditor. Participants and their Beneficiaries, heirs, successors
and assigns shall have no legal or equitable rights, interests
or claims in any property or assets of an Employer. For purposes of the payment of benefits
under this Plan, any and all of an Employer’s assets shall be, and remain, the general,
unpledged unrestricted assets of the Employer. An Employer’s obligation under the Plan
shall be merely that of an unfunded and unsecured promise to pay money in the future.
	 
	16.3  	Employer’s Liability. An Employer’s liability for the payment of benefits shall be
defined only by the Plan and the Plan Agreement, as entered into between the Employer and a
Participant. An Employer shall have no obligation to a Participant under the Plan except as
expressly provided in the Plan and the Participant’s Plan Agreement.

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	16.4  	Nonassignability. Neither a Participant nor any other person shall have any right to
commute, sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber, transfer,
hypothecate, alienate or convey in advance of actual receipt, the amounts, if any, payable
hereunder, or any part thereof, which are, and all rights to which are expressly declared to
be, unassignable and non-transferable. No part of the amounts payable shall, prior to actual
payment, be subject to seizure, attachment, garnishment or sequestration for the payment of
any debts, judgments, alimony or separate maintenance owed by a Participant or any other
person, be transferable by operation of law in the event of a Participant’s or any other
person’s bankruptcy or insolvency or be transferable to a spouse as a result of a property
settlement or otherwise.
	 
	16.5  	Not a Contract of Employment. The terms and conditions of this Plan shall not be
deemed to constitute a contract of employment between any Employer and the Participant. Such
employment is hereby acknowledged to be an “at will” employment relationship that can be
terminated at any time for any reason, or no reason, with or without cause, and with or
without notice, unless otherwise expressly provided in a written employment agreement.
Nothing in this Plan shall be deemed to give a Participant the right to be retained in the
service of any Employer or to interfere with the right of any Employer to discipline or
discharge the Participant at any time.
	 
	16.6  	Furnishing Information. A Participant or Participant’s Beneficiary will cooperate
with the Committee by furnishing any and all information requested by the Committee and take
such other actions as may be requested in order to facilitate the administration of the Plan
and the payments of benefits hereunder, including but not limited to taking such physical
examinations as the Committee may deem necessary.
	 
	16.7  	Terms. Whenever any words are used herein in the masculine, they shall be construed
as though they were in the feminine in all cases where they would so apply; and whenever any
words are used herein in the singular or in the plural, they shall be construed as though they
were used in the plural or the singular, as the case may be, in all cases where they would so
apply.
	 
	16.8  	Captions. The captions of the articles, sections and paragraphs of this Plan are for
convenience only and shall not control or affect the meaning or construction of any of its
provisions.
	 
	16.9  	Governing Law. Subject to ERISA, the provisions of this Plan shall be construed and
interpreted according to the internal laws of the State of Nevada, without regard to its
conflicts of laws principles.
	 
	16.10  	Notice. Any notice or filing required or permitted to be given to the Committee
under this Plan shall be sufficient if in writing and hand-delivered, or sent by registered or
certified mail, to the address below:

Secretary of the MGM MIRAGE Deferred

Compensation Plan Committee

3600 Las Vegas Blvd So.

Las Vegas, NV 89109

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	   	Such notice shall be deemed given as of the date of delivery or, if delivery is made by
mail, as of the date shown on the postmark on the receipt for registration or certification.
	 
	   	Any notice or filing required or permitted to be given to a Participant under this Plan
shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known
address of the Participant.
	 
	16.11  	Successors. The provisions of this Plan shall bind and inure to the benefit of the
Participant’s Employer and its successors and assigns and the Participant and the
Participant’s designated Beneficiaries. No other person shall be a third-party beneficiary or
acquire any rights under this Plan.
	 
	16.12  	Spouse’s Interest. The interest in the benefits hereunder of a spouse of a
Participant who has predeceased the Participant shall automatically pass to the Participant
and shall not be transferable by such spouse in any manner, including but not limited to such
spouse’s will, nor shall such interest pass under the laws of intestate succession.
	 
	16.13  	Validity. In case any provision of this Plan shall be illegal or invalid for any
reason, said illegality or invalidity shall not affect the remaining parts hereof, but this
Plan shall be construed and enforced as if such illegal or invalid provision had never been
inserted herein.
	 
	16.14  	Incompetent. If the Committee determines in its discretion that a benefit under
this Plan is to be paid to a minor, a person declared incompetent or a person incapable of
handling the disposition of that person’s property, the Committee may direct payment of such
benefit to the guardian, legal representative or person having the care and custody of such
minor, incompetent or incapable person. The Committee may require proof of minority,
incompetence, incapacity or guardianship, as it may deem appropriate prior to distribution of
the benefit. Any payment of a benefit shall be a payment for the account of the Participant
and the Participant’s Beneficiary, as the case may be, and shall be a complete discharge of
any liability under the Plan for such payment amount.
	 
	16.15  	Court Order. The Committee is authorized to make any payments directed by court
order in any action in which the Plan or the Committee has been
named as a party. In addition, if a court determines that a spouse or
former spouse of a Participant has an interest in the Participant’s
benefits under the Plan in connection with a property settlement or
otherwise, the Committee, in its sole discretion, shall have the right,
notwithstanding any election made by a Participant, to immediately
distribute the spouse’s or former spouse’s interest in the Participant’s
benefits under the Plan to that spouse or former spouse. Notwithstanding
the foregoing, the Committee shall interpret this provision in a manner
that is consistent with Code Section 409A and other applicable tax law,
including but not limited to guidance issued after the effective date of
this Plan.
	 
	16.16  	Distribution in the Event of Taxation.

	 	(a)  	In General. If, for any reason, all or any portion of a Participant’s benefits
under this Plan becomes taxable to the Participant prior to receipt, a Participant may
petition the Committee before a Change in Control, or the Trustee of the Trust after a
Change in Control, for a distribution of that portion of the Participant’s benefit that
has become

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	 	   	taxable. Upon the grant of such a petition, which grant shall not be
unreasonably withheld (and, after a Change in Control, shall be granted), a
Participant’s Employer shall distribute to the Participant immediately available funds
in an amount equal to the taxable portion of the Participant’s benefit (which amount
shall not exceed a Participant’s unpaid vested Account Balance under the Plan). If the
petition is granted, the tax liability distribution shall be made within 90 days of the
date when the Participant’s petition is granted. Such a distribution shall affect and
reduce the benefits to be paid under this Plan. Notwithstanding the foregoing, the
Committee shall interpret this provision in a manner that is consistent with Code
Section 409A and other applicable tax law, including but not limited to guidance issued
after the effective date of this Plan.
	 
	 	(b)  	Trust. If the Trust terminates in accordance with its terms and
benefits are distributed from the Trust to a Participant in accordance therewith, the
Participant’s benefits under this Plan shall be reduced to the extent of such
distributions.

	16.17  	Legal Fees To Enforce Rights After Change in Control. The Company and each Employer
is aware that upon the occurrence of a Change in Control, the Board or the board of directors
of a Participant’s Employer (which might then be composed of new members) or a shareholder of
the Company or the Participant’s Employer, or of any successor corporation, might cause or
attempt to cause, the Company, the Participant’s Employer or such successor to refuse to
comply with its obligations under the Plan and might cause or attempt to cause the Company or
the Participant’s Employer to institute, or may institute, litigation seeking to deny
Participants the benefits intended under the Plan. In these circumstances, the purpose of the
Plan could be frustrated. Accordingly, if, following a Change in Control, it should appear to
any Participant that the Company, the Participant’s Employer or any successor corporation has
failed to comply with any of its obligations under the Plan or any agreement thereunder or, if
the Company, such Employer or any other person takes any action to declare the Plan void or
unenforceable or institutes any litigation or other legal action designed to deny, diminish or
to recover from any Participant the
benefits intended to be provided (collectively, the “Dispute”), then the Company and the
Participant’s Employer shall pay, if the Participant prevails in the Dispute, the
Participant’s reasonable legal fees and court costs actually incurred by the Participant in
the initiation or defense of the Dispute, whether by or against the Company or the
Participant’s Employer or any director, officer, shareholder or other person affiliated with
the Company, the Participant’s Employer or any successor thereto.

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	16.18  	Unvested Account Balances Under Prior Plan. If a Participant participated in the
Prior DCP, and all or a part of the Participant’s account balance under that plan was unvested
as of December 31, 2004, that unvested balance will be transferred to this Plan in accordance
with Code Section 409A and the regulations thereunder, and such balance shall be administered
in accordance with the provisions of this Plan, provided, however, that the vesting of that
balance shall be based on the applicable vesting schedule(s) under the Prior DCP, which are
incorporated herein by reference.

IN WITNESS WHEREOF, the Company has signed this Plan document effective as of December 30, 2004.

	 	 	 	 	 	 	 
	 	 	“Company”	 	 
	 	 	MGM MIRAGE, a Delaware corporation	 	 
	 

 
	 	 	 	 	 	 
	

	 	 	 	/s/ Gary N. Jacobs	 	 
	

	 	 	 	 	 	 
	

	 	By:	 	Gary N. Jacobs	 	 
	

	 	 	 	 	 	 
	

	 	Title:	 	Executive Vice President and
General Counsel	 	 
	

	 	 	 	 	 	 

-26-exv10w1

 

Exhibit 10.1

November 18, 2004

Mr. David W. Brandenburg

9500 Plains Circle

Frisco, Texas 75034

Dear David:

     This letter confirms the discussions held with you regarding your retirement from Intervoice,
Inc. (“Intervoice”). The terms set forth below constitute Intervoice’s offer and, by your
signature, your acceptance of this proposed Letter Agreement (this “Agreement”). On behalf of
Intervoice, I want to express my appreciation for your past service and contribution and wish you
success in your future endeavors.

     1.      Resignation as an Executive Officer and as a Director.

     (a)      You have offered your resignation from Intervoice as Chairman of the
Board of Directors and Chief Executive Officer, as well as from all directorships,
offices and other positions held with Intervoice’s subsidiaries and affiliates, and
Intervoice hereby accepts your resignation on the terms set forth herein as of the date of
this Agreement (the “Retirement Date”).

     (b)      You have offered your resignation as a member of the Board of Directors
of Intervoice effective on or before December 31, 2004, and Intervoice hereby accepts your
resignation from the Board of Directors.

     2.      Salary and Benefits. In accordance with Intervoice’s existing policies,
you have received or will receive the following payments and benefits pursuant to your employment
with Intervoice and your participation in Intervoice’s benefit plans:

     (a)      Payment of your regular base salary at the current rate for a period of
thirty (30) days after the Retirement Date;

     (b)      Payment of any accrued and unused vacation leave benefits on your current
schedule of benefits as of the Retirement Date;

     (c)      At your discretion, exercise of any stock options you hold, to the extent
such options are vested as of the Retirement Date, within the thirty (30) day period
beginning on the Retirement Date (it being understood that no unvested options held by you
will vest after the

 

 

Mr. David W. Brandenburg

November 18, 2004

Page 2

Retirement Date, and that to the extent the Manner of Exercise provisions contained in
your stock option agreements require the consent of the Compensation Committee of
Intervoice, Intervoice confirms that the Compensation Committee of Intervoice so consents;
provided, however, that you understand that you cannot sell Intervoice stock or make a
cashless exercise of any vested options while you possess material nonpublic information);
and

     (d)      Present or future payment or other entitlement, in accordance with the
terms of the applicable plan or other benefit, of any benefits to which you have vested
entitlement under the terms of employee benefit plans established by Intervoice through the
thirtieth (30th) day after the Retirement Date.

     The amounts paid in accordance with subparagraphs (a) and (b) of this Paragraph are gross
amounts, subject to lawful deductions, including any deductions you have previously authorized.

     Your regular paid group health insurance benefits will continue only through the last day of
the month in which you cease to be an Intervoice employee. By law, you are entitled at your option
to continue your group health insurance coverage for a period of time thereafter at your own
expense. Please complete a COBRA election form, which will be furnished to you, and return it to
H. Don Brown in Intervoice’s Human Resources Department at your earliest convenience, in accordance
with the terms of the election form, if you wish to continue such insurance coverage.

     Intervoice will settle all authorized reimbursable business expenses, if any, based on your
submission of appropriate expense reports along with the required receipts and documentation.
Final expense reports for any remaining outstanding reimbursable expenses you have incurred must be
submitted within ten (10) days after the Retirement Date, except for any charges not billed to you
by that time, in which case the expense must be promptly submitted upon your receipt of the
billing.

     Intervoice will notify Paragon Life, the issuer of the life insurance policy (policy number
0001903756) (the “Policy”), that, should you wish to continue coverage under the Policy, all
premiums payable under the Policy commencing on the thirty-first (31st) day after the
Retirement Date will be payable by you.

     3.      Employment Agreement Replaced by this Agreement; Preservation of Covenant Not
to Compete and Confidentiality Provisions. Except as otherwise provided herein, that certain
Employment Agreement effective June 26, 2000, as amended by the First Amended Employment Agreement
effective March 1, 2001, and the Second Amended Employment Agreement effective March 1, 2002
(together with any and all other amendments thereto, collectively the “Employment Agreement”),
between you and Intervoice is replaced in its entirety by this Agreement as of the Effective Date
hereof, and the terms of this Agreement will supersede all provisions of the Employment Agreement.
Notwithstanding the foregoing, (a) Paragraph 6 (“Covenant Not to Compete”) of the Employment
Agreement and (b) Paragraph 27 (“Assignment, Protection and Confidentiality of Proprietary
Information”) of the Employment Agreement, which Paragraphs 6 and 27 are incorporated herein by
reference, will continue in full force and effect, and nothing herein will act to cancel, change,
or supersede your continuing obligations under such preserved provisions. You and Intervoice
acknowledge your mutual intention that the terms of this Agreement alone, and not the Employment
Agreement, will define your compensation for the remainder of your employment and upon cessation of
your employment with Intervoice.

 

 

Mr. David W. Brandenburg

November 18, 2004

Page 3

     4.      Continuation of Obligations Under Employee Agreement on Ideas, Inventions and
Confidential Information. Nothing herein will act to cancel, change, or supersede your
continuing obligations as specified under Sections 1, 4, 5 and 7 of the Employee Agreement on
Ideas, Inventions and Confidential Information that you executed on June 26, 2000, which agreement
is incorporated herein by reference.

     5.      Compelled Disclosure of Confidential Information. In the event you
believe that you are compelled by law or valid legal process to disclose any confidential
information within the purview of Paragraph 27 of the Employment Agreement or any provision of the
Employee Agreement on Ideas, Inventions and Confidential Information, you will notify Intervoice in
writing, through its Executive Vice President and General Counsel, reasonably in advance of any
such disclosure to allow Intervoice the opportunity to defend, limit, or otherwise protect its
interests against such disclosure.

     6.      Return of Property. You agree, unless otherwise agreed in writing, to
return to Intervoice any and all items of its property; provided, however, that you will be
permitted to retain the chair, artwork in your office and any other personal property belonging to
you, and upon your reasonable request, Intervoice will provide you with electronic copies of any
personal files contained on the personal computer of Intervoice used by you.

     7.      Confidentiality, Cooperation and Other Commitments.

     (a)      Disclosure of Terms. You have been informed that this Agreement
will be included as an exhibit to the Quarterly Report on Form 10-Q for the quarter ending
November 30, 2004 that Intervoice will file with the Securities and Exchange Commission, and
that it will be discussed in one or more documents filed by Intervoice with the Securities
and Exchange Commission, including a Current Report on Form 8-K. Intervoice will provide
you the opportunity to review and comment on the initial press release issued, and message
sent to Intervoice employees, concerning this Agreement. In any filing by Intervoice
pursuant to the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, Intervoice will limit its public disclosure of the subject matter hereof to the
terms included in this Agreement, unless otherwise required by law due to subsequent events.

     (b)      Cooperation. You will cooperate fully and completely with
Intervoice, at its reasonable request, in all pending and future litigation, investigations,
arbitrations, and/or other fact-finding or adjudicative proceedings, public or private,
involving Intervoice. This obligation includes your meeting with counsel for Intervoice at
reasonable times upon their request, and providing truthful and accurate testimony in court,
before an administrative or governmental agency, arbitrator or other convening authority, or
upon deposition. The foregoing provisions do not diminish any rights you may have to be
represented by your own counsel. If you (i) appear as a witness in any pending or future
litigation, arbitration, or other fact-finding or adjudicative proceeding at the request of
Intervoice or (ii) for any other reason incur out-of-pocket expenses in connection with
fulfillment of your duties under this Subparagraph 7(b) at the request of Intervoice,
Intervoice agrees to reimburse you, upon, and within five (5) days of, submission of
substantiating documentation, for necessary and reasonable travel, lodging, and food
expenses incurred by you as a result thereof.

 

 

Mr. David W. Brandenburg

November 18, 2004

Page 4

 
     (c)      Mutual Nondisparagement; Handling of Inquiries. You will not
make to any other parties any statement, oral or written, which directly or indirectly
impugns the quality or integrity of Intervoice’s business, accounting, or employment
practices, or any other disparaging or derogatory remarks about Intervoice, its officers,
directors, shareholders, managerial personnel, or other employees; and Intervoice will
instruct its officers, directors or other representatives not to make any disparaging or
derogatory remarks about you, including, without limitation, any remarks that impugn your
leadership, performance or integrity while an employee of the Company. Intervoice and you
each acknowledge that no such statements or remarks have been made to date. Nothing herein
is intended to or will act in any manner to prevent you or Intervoice’s officers, directors
and other representatives from presenting testimony, making statements or providing
information, in connection with any legal or governmental investigation or proceeding, that
is truthful and accurate. Except as further provided herein below, any direct inquiries to
Intervoice from potential employers will receive Intervoice’s normal response, pursuant to
its current established policy, which provides for release solely of the following
information: verification of (i) name, (ii) last job title held, and (iii) dates of service.
If you have authorized Intervoice to provide other information in specific instances,
Intervoice shall use in those instances the form of response, containing such factual
information as has been jointly determined and agreed upon by you and Intervoice.

     8.      Director’s and Officer’s Indemnification and Insurance. Intervoice
hereby reaffirms its obligations to you pursuant to the provisions of its Bylaws at Paragraph 8.7,
Indemnification, as currently in effect, to indemnify you and to advance you reasonable expenses
(including attorneys’ fees) in accordance therewith, both before and after the Retirement Date, in
each such case to the extent required by law. Intervoice acknowledges and agrees that you have
provided to Intervoice the undertaking required by Paragraph 8.7(H) of its Bylaws and that you are
entitled to advancement of any expenses, including attorneys’ fees, in connection with the lawsuit
entitled David Barrie and Jill C. Richling, et al. v. Intervoice-Brite, Inc., et al., Cause No.
C83-01CV1071-D, pending as of the date of this Agreement before the Fifth Circuit Court of Appeals.
For not less than five (5) years after the Retirement Date, in any existing or future director and
officer insurance policies, Intervoice will cause you to be provided insurance coverage equal in
scope and amount to any other director or executive officer of Intervoice.

     9.      Governing Law and Interpretation. This Agreement and the rights and
duties of the parties under it will be governed by and construed in accordance with the laws of the
State of Texas, without regard for any conflicts of laws provisions. If any provision of this
Agreement is held to be unenforceable, such provision will be considered separate, distinct, and
severable from the other remaining provisions of this Agreement, and will not affect the validity
or enforceability of such other remaining provisions; and in all other respects, this Agreement
will remain in full force and effect. If any provision of this Agreement is held to be
unenforceable as written but may be made to be enforceable by limitation thereof then such
provision will be enforceable to the maximum extent permitted by applicable law. The language of
all parts of this Agreement will in all cases be construed as a whole, according to its fair
meaning, and not strictly for or against any of the parties.

     10.      Notices. Any notices required or permitted to be given under the terms
of this Agreement will be given in writing, delivered to the attention of the persons or offices
specified below. Any such notices will be considered effective only upon actual delivery to the
appropriate address, marked to the attention of the party or officer for whom the notice is
intended.

 

 

Mr. David W. Brandenburg

November 18, 2004

Page 5

	 	 	 
	If to Intervoice:

	 	If to you:
	 
	 	 
	Intervoice, Inc.

	 	David W. Brandenburg
	Attn: Executive Vice President

	 	9500 Plains Circle
	and General Counsel

	 	Frisco, Texas 75034
	and
	 	 
	Executive Vice President
	 	 
	Human Resources
	 	 
	17811 Waterview Parkway
	 	 
	Dallas, Texas 75252
	 	 
	 
	 	 
	With a copy to:

	 	With a copy to:
	 
	 	 
	David E. Morrison

	 	D. Gilbert Friedlander
	Fulbright & Jaworski L.L.P.

	 	Weil, Gotshal & Manges LLP
	2200 Ross Ave., Suite 2800

	 	200 Crescent Court, Suite 300
	Dallas, Texas 75201

	 	Dallas, Texas 75201

     11.       Entire Agreement. Except with respect to those sections of the Employee
Agreement on Ideas, Inventions and Confidential Information and the Employment Agreement expressly
referred to and incorporated by reference herein, this Agreement shall contain the entire agreement
and understanding among the parties with respect to the subject matter hereof and shall supersede
and replace any and all prior arrangements, understandings, representations, agreements or other
communications, whether written or oral, between or among the parties relating to the subject
matter hereof. This Agreement may be modified only by a writing of contemporaneous or subsequent
date executed by both you and an authorized official of Intervoice.

 

 

Mr. David W. Brandenburg

November 18, 2004

Page 6

     If you are in agreement with the foregoing provisions, please execute both copies of this
letter in the space provided below. You should return one executed original to the undersigned,
and maintain the other executed original in your files.

	 	 	 	 	 
	 	Sincerely,

INTERVOICE, INC.

 	 
	 	By:  	/s/ Gerald F. Montry
 	 
	 	 	Gerald F. Montry 	 
	 	 	Chairman of the Board 	 
	 

ACCEPTED AND AGREED TO:

	 	 	 
	    /s/ David W. Brandenburg

	 	 
	    David W. Brandenburg
	 	 

Date Signed: November 18, 2004

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