UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K


(Mark One)

[X]

☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2017

2021

OR

[  ]

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-10362

MGM Resorts International

Resorts International

(Exact name of Registrant as specified in its charter)

DELAWARE

88-0215232

Delaware

88-0215232
(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification Number)

3600 Las Vegas Boulevard South - Las Vegas, Nevada 89109

(Address of principal executive office) (Zip Code)

(702) 693-7120

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 Trading Symbol(s)

Name of each exchange
on which registered

Common Stock, $0.01 Par Value

MGM

New York Stock Exchange

(NYSE)

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes   X  ☒ No

☐

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐No   X  

☒

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes   X  ☒ No

☐

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes   X  ☒ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of the Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K:         

☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act (check one):

Act.

Large accelerated filer  X  

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐
Emerging Growth Company___

growth company
☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ___

☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act): Yes ☐No   X  

☒

The aggregate market value of the Registrant’s Common Stock held by non-affiliates of the Registrant as of June 30, 20172021 (based on the closing price on the New York Stock Exchange Composite Tape on June 30, 2017)2021) was $17.9$17.5 billion. Shares of common stock held by each officer and director and by each person who owns 10% or more of the outstanding common shares have been excluded. As of February 23, 2018, 566,367,4262022, 439,172,269 shares of Registrant’s Common Stock, $0.01 par value, were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE


Portions of the Registrant’s definitive Proxy Statement for its 20182022 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K.

PART I

ITEM 1.

BUSINESS


TABLE OF CONTENTS
Page
PART I
Item 1.
1
Item 1A.
15
Item 1B.
32
Item 2.
33
Item 3.
34
Item 4.
34
PART II
Item 5.
35
Item 6.
37
Item 7.
37
Item 7A.
57
Item 8.
58
62
67
107
Item 9.
108
Item 9A.
108
Item 9B.
109
Item 9C.
109
PART III
Item 10.
110
Item 11.
110
Item 12.
110
Item 13.
110
Item 14.
110
PART IV
Item 15.
111
Item 16.
118
119



PART I

ITEM 1.    BUSINESS

MGM Resorts International is referred to as the “Company,” “MGM Resorts,” or the “Registrant,” and together with its subsidiaries may also be referred to as “we,” “us” or “our.” MGM China Holdings Limited together with its subsidiaries is referred to as “MGM China.” Except where the context indicates otherwise, “MGP” refers to MGM Growth Properties LLC together with its consolidated subsidiaries.


Overview


MGM Resorts International is a Delaware corporation incorporated in 1986 that acts largely as a holding company and, through subsidiaries, owns and operates integrated casino, hotel, and entertainment resorts across the United States and in Macau. As discussed further below, we lease certain of our real estate assets from MGM Growth Properties Operating Partnership LP (the “Operating Partnership”), which is a consolidated subsidiary.


We believe we own or invest inoperate several of the finest casino resorts in the world and we continually reinvest in our resorts to maintain our competitive advantage. We make significant investments in our resorts through newly remodeled hotel rooms, restaurants, entertainment and nightlife offerings, as well as other new features and amenities. We believe we operate the highest quality resorts in each of the markets in which we operate. Ensuring our resorts are the premier resorts in their respective markets requires capital investments to maintain the best possible experiences for our guests.

MGM Growth Properties

On April 25, 2016,


MGM Growth Properties LLC (“MGP”), is a consolidated subsidiary completed its initial public offering (“IPO”). MGP is organized as an umbrella partnership REIT (commonly referred to as an “UPREIT”) structure in which substantiallyof the Company. Substantially all of its assets are owned by and substantially all of its businesses are conducted through the Operating Partnership. MGP has two classes of authorized and outstanding voting common shares (collectively, the “shares”): Class A shares and a single Class B share. We own MGP’s Class B share, which does not provide its holder any rights to profits or losses or any rights to receive distributions from operations of MGP or upon liquidation or winding up of MGP. MGP’s Class A shareholders are entitled to one vote per share, while we, as the owner of the Class B share, are entitled to an amount of votes representing a majority of the total voting power of MGP’s shares so long as our and our controlled affiliates’ (excluding MGP and its subsidiaries) aggregate beneficial ownership of the combined economic interests in MGP and thesubsidiary MGM Growth Properties Operating Partnership does not fall below 30%LP (the “Operating Partnership”). The sole general partnerAs of the Operating Partnership is also a subsidiary of MGP.

MGP used the proceeds from its IPO to purchase operating partnership units in the Operating Partnership. Concurrently,December 31, 2021, we contributedlease the real estate assets associated withof The Mirage, Mandalay Bay, Luxor, New York-New York, Monte Carlo,Park MGM, Excalibur, The Park, Gold Strike Tunica, MGM Grand Detroit, and Beau Rivage, Borgata, Empire City, MGM National Harbor, MGM Northfield Park, and MGM Springfield pursuant to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership. See Note 1 in the accompanying consolidated financial statements for information regarding MGP and the Operating Partnership, which we consolidate in exchangeour financial statements, and Note 18 in the accompanying consolidated financial statements for operating partnership units. A whollyinformation regarding the master lease with MGP, which eliminates in consolidation.


We lease the real estate assets of Bellagio pursuant to a lease agreement between a subsidiary of ours and a venture that is 5% owned by such subsidiary and 95% owned by a subsidiary of Blackstone Real Estate Income Trust, Inc. (“BREIT”, and such venture, the “Bellagio BREIT Venture”). We lease the real estate assets of Mandalay Bay and MGM Grand Las Vegas pursuant to a lease agreement between a subsidiary of ours and a venture that is 50.1% owned by a subsidiary of the Operating Partnership (the “landlord”) subsequently leasedand 49.9% owned by a subsidiary of BREIT (such venture, the properties“MGP BREIT Venture”). We lease the real estate assets of Aria (including Vdara) pursuant to a lease agreement between a subsidiary of ours and funds managed by The Blackstone Group Inc. ("Blackstone"). Refer to Note 11 for further discussion of these leases.

Business Developments

In recent years, in furtherance of our vision to be the world’s premier gaming entertainment company, we have implemented an asset-light business model, which has involved a comprehensive review of our owned real estate assets to find opportunities to monetize those assets efficiently and allow unlocked capital to be redeployed towards balance sheet improvements, new growth opportunities, and to return value to our shareholders. At the same time, we have continued to focus on key growth opportunities that align with our vision, particularly by investing in U.S. online sports betting and iGaming through BetMGM, expanding our digital capabilities, and seeking to diversify our Asia operations with development efforts in Japan.

As part of that business strategy, we have sought, and executed on, opportunities to invest in our growth areas, divest our real estate assets, and acquire, or enter into venture transactions with respect to the operations of integrated casino, hotel, and entertainment resorts, including through the following transactions:

•In July 2018, we and Entain plc (“Entain”) formed BetMGM, LLC (“BetMGM”), a venture that is owned 50% by each party. In connection with its formation, we provided BetMGM with exclusive access to all of our domestic landbased and online sports betting, major tournament poker, and online gaming operations and Entain provided BetMGM with exclusive access to its technology in the United States.

•In January 2019, we acquired the real property and operations associated with Empire City Casino's racetrack and casino ("Empire City") for total consideration of approximately $865 million. Subsequently, MGP acquired
1

Empire City’s developed real property from us and Empire City was added to the master lease between us and MGP. Refer to Note 4 and Note 18 for additional information.

•In March 2019, we entered into an amendment to the master lease between us and MGP with respect to improvements made by us related to the rebranding of the Park MGM and NoMad Las Vegas property (the “tenant”“Park MGM Transaction”). Refer to Note 18 for additional information on this transaction, which eliminates in consolidation.

•Additionally, in November 2019, Bellagio BREIT Venture was formed, which acquired the Bellagio real estate assets from us for total consideration of $4.25 billion, and leased such assets back to us pursuant to a lease agreement. Refer to Note 11 for additional information relating to the lease and Note 12 for the guarantee entered into in connection with the transaction.

•In December 2019, we completed the sale of Circus Circus Las Vegas and adjacent land for $825 million. See Note 16 for additional information related to this transaction.

•On February 14, 2020, we completed a series of transactions (collectively the “MGP BREIT Venture Transaction”) pursuant to which the real estate assets of MGM Grand Las Vegas and Mandalay Bay (including Mandalay Place) were contributed to the newly formed MGP BREIT Venture in exchange for total consideration of $4.6 billion. See Note 1 for further discussion on the transaction and Note 12 for the guarantee entered into in connection with the transaction.

•In connection with the MGP BREIT Venture Transaction, MGP BREIT Venture entered into a long-term triple-netlease with us for the real estate assets of Mandalay Bay and MGM Grand Las Vegas. Additionally, the master lease with MGP was modified to remove the Mandalay Bay property and the annual cash rent under the MGP master lease was reduced by $133 million, as further discussed in Note 18. Refer to Note 11 for additional information relating to the lease.

•Also, on January 14, 2020, we, the Operating Partnership, and MGP entered into a waiver agreement (the “master lease”pursuant to which approximately 30 million Operating Partnership units that we held were redeemed for $700 million on May 18, 2020 and approximately 24 million Operating Partnership units that we held were redeemed for $700 million on December 2, 2020. As a result, the waiver terminated in accordance with its terms. Refer to Note 1 for further information regarding this transaction, which eliminates in consolidation.

•On March 4, 2021, we delivered a notice of redemption to MGP covering approximately 37 million Operating Partnership units that we held which was satisfied with aggregate cash proceeds of approximately $1.2 billion, using cash on hand together with the proceeds from MGP's issuance of Class A shares. See Note 13 for information regarding this transaction, which eliminates in consolidation.

•On August 4, 2021, we entered into an agreement with VICI Properties, Inc. (“VICI”) and MGP whereby VICI will acquire MGP in a stock-for-stock transaction (such transaction, the “VICI Transaction”).

Pursuant to the agreement, MGP Class A shareholders will receive 1.366 shares of newly issued VICI stock in exchange for each MGP Class A share outstanding and we will receive 1.366 units of the new VICI operating partnership (“VICI OP”) in exchange for each Operating Partnership unit held by us. In August 2016,connection with the exchange, VICI OP will redeem the majority of our VICI OP units for cash consideration of $4.4 billion. MGP’s Class B share that is held by us will be cancelled. As part of the transaction, we will enter into an amended and restated master lease with VICI. The transaction is expected to close in the first half of 2022, subject to customary closing conditions, regulatory approvals, and approval by VICI stockholders (which was obtained on October 29, 2021). Refer to Note 1 for further information.


•On September 26, 2021, we entered into an agreement to acquire the operations of The Cosmopolitan of Las Vegas ("The Cosmopolitan") for cash consideration of $1.625 billion, subject to customary working capital adjustments. Additionally, the Company will enter into a lease agreement for the real estate assets of The Cosmopolitan. The transaction is expected to close in the first half of 2022, subject to regulatory approvals and other customary closing conditions. Refer to Note 1 for further information.

•On September 27, 2021, we completed the acquisition of Boyd Gaming Corporation’s (“Boyd Gaming”)the 50% ownership interest in Borgata, at which time Borgata becameCityCenter Holdings, LLC ("CityCenter") held by Infinity World Development Corp ("Infinity World"), a consolidatedwholly owned subsidiary of ours. Subsequently, MGP acquired Borgata’s real property from us, and in October 2017, MGP also acquired the long-term leasehold interest and real property associated with MGM National Harbor from us. In connection with these transactions,Dubai World, a Dubai, United Arab Emirates government decree entity, for cash consideration of $2.125 billion. Refer to Note 4 for additional information on this acquisition.

2

•On September 28, 2021, we entered into amendments to the master lease for our subsidiary to lease backsold the real estate assets of BorgataAria (including Vdara) to funds managed by Blackstone for cash consideration of $3.89 billion and entered into a lease through which the real property is leased back to a subsidiary of the Company. Refer to Note 11 for discussion of the lease agreement.

•On September 28, 2021, we announced that we, together with our venture partner, ORIX Corporation ("ORIX"), were selected by Osaka as the region’s integrated resort partner. In December 2021, we and ORIX formed a venture, through which we will bid to develop one of Japan's first integrated resorts.

•On October 29, 2021, MGP acquired the real estate assets of MGM Springfield from us for cash consideration of $400 million and MGM National Harbor fromSpringfield was added to the landlord.

AsMGP master lease between us and MGP through which MGP leases back the real property to a subsidiary of December 31, 2017, we owned 73.4%ours. Transactions with MGP, including transactions under the MGP master lease, have been eliminated in our consolidation of MGP. Refer to Note 18 for further discussion of the Operating Partnership units,master lease with MGP.


•On December 13, 2021, we entered into an agreement to sell the operations of The Mirage to an affiliate of Seminole Hard Rock Entertainment, Inc. ("Hard Rock") for cash consideration of $1.075 billion, subject to certain purchase price adjustments. Upon closing, the master lease between us and VICI (or MGP held the remaining 26.6% ownership interest in the Operating Partnership.  

event that the VICI Transaction is terminated) will be amended and restated to reflect a $90 million reduction in annual cash rent. The transaction is expected to close during the second half of 2022, subject to certain closing conditions, including, but not limited to, the consummation or termination of the VICI Transaction and receipt of regulatory approvals. Refer to Note 1 for further information.


For additional information relating to our acquisitions, divestitures, venture transactions, and other arrangements, including those referred to above, see “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations,” as well as the notes to our consolidated financial statements specified above.

Financial Impact of COVID-19. See “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Description of our business and key performance indicators — Financial Impact of COVID-19” for more information about the effect of the COVID-19 pandemic on our business and our recovery. For a discussion of the risks to our business resulting from COVID-19, see “Item 1A. Risk Factors — Risks Related to Our Business, Industry, and Market Conditions.”

Resort Operations


General


Most of our revenue is cash-based, through customers wagering with cash or paying for non-gaming services with cash or credit cards. We rely heavily on the ability of our resorts to generate operating cash flow to fund capital expenditures, provide excess cash flow for future development, acquisitions or investments, and repay debt financings.



Our results of operations do not tend to be seasonal in nature as all of our casino resorts, except as otherwise described related to the impact of COVID-19, typically operate 24 hours a day, every day of the year, with the exception of Empire City, which operates 20 hours a day, every day of the year, though a variety of factors may affect the results of any interim period, including the timing of major conventions, Far East baccarat volumes, the amount and timing of marketing and special events for our high-end gaming customers, and the level of play during major holidays, including New Year and Lunar New Year. While our results do not depend on key individual customers, a significant portion of our operating income is generated from high-end gaming customers, which can cause variability in our results. In addition, our success in marketing to customer groups such as convention customers and the financial health of customer segments such as business travelers or high-end gaming customers from a specific country or region can affect our results.

All of our casino resorts operate 24 hours a day, every day of the year, with the exception of Grand Victoria which operates 22 hours a day, every day of the year. At our domestic resorts, ourOur primary casino and hotel operations are owned and managed by us. Other resort amenities may be owned and operated by us, owned by us but managed by third parties for a fee, or leased to third parties. We utilize third-party management for specific expertise in operations of restaurants and nightclubs. Wealso lease space to third-party retail and food and beverage operators, particularly for branding opportunities.

Our Operating Resorts

We have provided certain information below about our resorts as


As of December 31, 2017. Except2021, we have three reportable segments: Las Vegas Strip Resorts, Regional Operations, and MGM China, as otherwise indicated, we own and operate the resorts showngenerally described below.

 

 

Number of

 

 

Approximate

 

 

 

 

 

 

 

 

 

 

 

Guestrooms

 

 

Casino Square

 

 

 

 

 

 

Gaming

 

Name and Location

 

and Suites

 

 

Footage (1)

 

 

Slots (2)

 

 

Tables (3)

 

Domestic Resorts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Las Vegas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bellagio

 

 

3,933

 

 

 

155,000

 

 

 

1,797

 

 

 

148

 

MGM Grand Las Vegas (4)

 

 

6,161

 

 

 

167,000

 

 

 

1,625

 

 

 

127

 

Mandalay Bay (5)

 

 

4,752

 

 

 

155,000

 

 

 

1,232

 

 

 

72

 

The Mirage

 

 

3,044

 

 

 

93,000

 

 

 

1,244

 

 

 

77

 

Luxor

 

 

4,397

 

 

 

101,000

 

 

 

1,056

 

 

 

58

 

Excalibur

 

 

3,981

 

 

 

93,000

 

 

 

1,013

 

 

 

51

 

New York-New York

 

 

2,024

 

 

 

81,000

 

 

 

1,172

 

 

 

70

 

Monte Carlo

 

 

2,992

 

 

 

90,000

 

 

 

675

 

 

 

45

 

Circus Circus Las Vegas

 

 

3,764

 

 

 

95,000

 

 

 

1,245

 

 

 

43

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MGM Grand Detroit (Detroit, Michigan) (6)

 

 

400

 

 

 

127,000

 

 

 

3,543

 

 

 

126

 

Beau Rivage (Biloxi, Mississippi)

 

 

1,740

 

 

 

81,000

 

 

 

1,797

 

 

 

80

 

Gold Strike (Tunica, Mississippi)

 

 

1,133

 

 

 

48,000

 

 

 

1,194

 

 

 

59

 

Borgata (Atlantic City, New Jersey)

 

 

2,767

 

 

 

160,000

 

 

 

3,030

 

 

 

187

 

MGM National Harbor (Prince George's County, Maryland) (7)

 

 

308

 

 

 

123,000

 

 

 

2,818

 

 

 

129

 

Subtotal

 

 

41,396

 

 

 

1,569,000

 

 

 

23,441

 

 

 

1,272

 

MGM China:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MGM Macau – 55.95% owned (Macau S.A.R.)

 

 

582

 

 

 

346,000

 

 

 

1,019

 

 

 

427

 

Other Operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CityCenter – 50% owned (Las Vegas, Nevada) (8)

 

 

5,891

 

 

 

139,000

 

 

 

1,564

 

 

 

126

 

Grand Victoria – 50% owned (Elgin, Illinois) (9)

 

 

—

 

 

 

30,000

 

 

 

1,088

 

 

 

42

 

Subtotal

 

 

5,891

 

 

 

169,000

 

 

 

2,652

 

 

 

168

 

Grand total

 

 

47,869

 

 

 

2,084,000

 

 

 

27,112

 

 

 

1,867

 

(1)

Casino square footage is approximate and includes the gaming floor, race and sports, high limit areas and casino specific walkways, and excludes casino cage and other non-gaming space within the casino area.

(2)

Includes slot machines, video poker machines and other electronic gaming devices.

(3)

Includes blackjack (“21”), baccarat, craps, roulette and other table games; does not include poker.

(4)

Includes 1,164 rooms at The Signature at MGM Grand Las Vegas.

(5)

Includes 1,117 rooms at the Delano and 424 rooms at the Four Seasons Hotel.

(6)

Our local investors have an ownership interest of approximately 3% of MGM Grand Detroit.

(7)

Our local investors have a non-voting economic interest in MGM National Harbor. Refer to Note 2 See Note 17 for further description of such interest.

(8)

Includes Aria with 4,004 rooms and Mandarin Oriental Las Vegas with 392 rooms. Vdara includes 1,495 condo-hotel units, which are predominantly being utilized as company-owned hotel rooms. The other 50% of CityCenter is owned by Infinity World Development Corp.

(9)

The other 50% of Grand Victoria is owned by an affiliate of Hyatt Gaming, which also operates the resort.


More detailed financial information about each of our operating resorts can be found in Exhibit 99.1 to this Annual Report on Form 10-K, which Exhibit is incorporated herein by reference.  

Reportable Segments

We have two reportable segments based on the similar characteristicssegments.


Las Vegas Strip Resorts and Regional Operations
Las Vegas Strip Resorts. Las Vegas Strip Resorts consists of the operating segments: domestic resortsfollowing casino resorts:Aria (including Vdara) (upon acquisition in September 2021), Bellagio, MGM Grand Las Vegas (including The Signature), Mandalay Bay (including Delano and Four Seasons), The Mirage, Luxor, New York-New York (including The Park), Excalibur, Park MGM (including NoMad Las Vegas) and Circus Circus Las Vegas (until the sale of such property in December 2019).
Regional Operations. Regional Operations consists of the following casino resorts: MGM Grand Detroit in Detroit, Michigan; Beau Rivage in Biloxi, Mississippi; Gold Strike Tunica in Tunica, Mississippi; Borgata in Atlantic City, New
3

Jersey; MGM National Harbor in Prince George’s County, Maryland; MGM Springfield in Springfield, Massachusetts; Empire City in Yonkers, New York (upon its acquisition in January 2019); and MGM China. We currently own and operate 14 resortsNorthfield Park in the United States. MGM China’s operations consistNorthfield Park, Ohio (upon MGM’s acquisition of the MGM Macau resort and casino (“MGM Macau”) and MGM Cotai, an integrated casino, hotel, and entertainment resort on the Cotai Stripoperations from MGP in Macau that opened on February 13, 2018. We have additional business activities including our investments in unconsolidated affiliates, and certain other corporate and management operations. CityCenter Holdings, LLC (“CityCenter”) is our most significant unconsolidated affiliate, which we also manage for a fee. See “Executive Overview” in Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 17 in the accompanying notes to the consolidated financial statements for additional information related to our segments.

       Domestic Resorts

April 2019).


Over half of the net revenue from our domestic resortsLas Vegas Strip Resorts is typically derived from non-gaming operations, including hotel, food and beverage, entertainment and other non-gaming amenities. Weamenities and the majority of the net revenue from our Regional Operations is typically derived from gaming operations. Although our domestic customer mix has changed in the near term as a result of the COVID-19 pandemic, our long-term strategy continues to be to market to different customers and utilize our significant convention and meeting facilities to allow us to maximize hotel occupancy and customer volumes, which also leads to better labor utilization. Our operating results are highly dependent on the volume of customers at our resorts,properties, which in turn affects the price we can charge for our hotel rooms and other amenities.


Our casino operations feature a variety of slots and table games, and, racethrough BetMGM, we offer online sports betting and sports book wagering.iGaming in certain jurisdictions in the United States. In addition, we offerprovide our premium players access to high-limit rooms and lounge experiences where players may enjoy an upscale atmosphere.


MGM China


We own approximately 56% of MGM China, which owns MGM Grand Paradise, S.A. (“MGM Grand Paradise”), the Macau company that owns and operates the MGM Macau and MGM Cotai casino resorts and holds the related gaming subconcession and land concessions. We believe our ownership interest in MGM China plays an important role in extending our reach internationally and will foster future growth and profitability. Macau isAlthough visitation during 2020 and 2021 was significantly reduced by the world’s largest gaming destination in terms of revenue andCOVID-19 pandemic, we expect the long-term future growth inof the Asian gaming market to drive additional visitation at MGM Macau and MGM Cotai.


Our current MGM China operations relate to MGM Macau and MGM Cotai, discussed further below. MGM China’s revenues are generated primarily from gaming operations which are conducted under a gaming subconcession held by MGM Grand Paradise.Paradise, a subsidiary of MGM China. The Macau government has granted three gaming concessions and each of these concessionaires has granted a subconcession. The MGM Grand Paradise gaming subconcession was granted by SJM Resorts S.A. ("SJMSA", formerly Sociedade de Jogos de Macau, S.A.), andwhich expires in 2020.June 2022. The Macau government currently prohibits additional concessions and subconcessions, but does not place a limit on the number of casinos or gaming areas operated by the concessionaires and subconcessionaires, though additional casinos or gaming areas require government approval prior to commencing operations.

In October 2012, See “Risk Factors — Risks Related to our Macau Operations — The Macau government can terminate MGM Grand Paradise’s subconcession under certain circumstances without compensating MGM Grand Paradise, formally acceptedexercise its redemption right with respect to the terms and conditionssubconcession, or refuse to grant MGM Grand Paradise an extension of the subconcession in 2022, or MGM Grand Paradise may be unsuccessful in obtaining a landgaming concession contract from the government of Macau to develop MGM Cotai on an approximately 18 acre site on the Cotai Strip. The land concession contract became effective when a new public tender is held by the Macau government, publishedany of which would have a material adverse effect on our business, financial condition, results of operations and cash flows.”


As discussed above, gaming in Macau is currently administered by the agreementMacau Government through concessions awarded to three different concessionaires and three subconcessionaires, of which a subsidiary of MGM China, MGM Grand Paradise, is a subconcessionaire. In 2019, the expiration of MGM Grand Paradise's subconcession term was extended from March 31, 2020 to June 26, 2022, consistent with the expiration of the other concessionaires and subconcessionaires. Pursuant to the current Macau gaming law, upon reaching the maximum duration of 20 years, the term of the concessions may be extended one or more times by order of the Chief Executive, which period may not exceed, in total, 5 years. On January 14, 2022, the Macau Government disclosed the content of a bill to amend Macau gaming law, which followed a 45-day public consultation process regarding draft amendment proposals that were issued in September 2021. Under the bill, the existing subconcessions will be discontinued and a maximum of six concessions will be awarded for a term to be specified in the Official Gazetteconcession contract that may not exceed 10 years and which may be extended by three years under certain circumstances. The bill is subject to debate and approval by the Macau Legislative Assembly. The approval of the new gaming law bill will precede the public tender for the awarding of new gaming concessions and to date the Macau Government has provided no indication as to whether the public tender will take place before expiry of the existing gaming concessions and subconcessions but acknowledged that it could consider the extension of the existing concessions and subconcessions beyond their current term if the public tender is held at a later date. Unless MGM Grand Paradise's gaming subconcession is extended or legislation with regard to reversion of casino premises is amended, the casino area premises and gaming-related equipment subject to reversion will automatically be transferred to the Macau Government upon expiration, and MGM Grand Paradise will cease to generate any revenues from such gaming operations. In addition, certain events relating to the loss, termination, rescission, revocation or modification of MGM Grand Paradise’s gaming subconcession in Macau, where such events have a material adverse effect on January 9, 2013the financial condition, business, properties, or results of operations of MGM China, taken as a whole, may result in a special put option triggering event under MGM China’s senior notes and has an initialevent of default under MGM China’s revolving credit facilities. MGM
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China continues to closely monitor developments regarding the retendering process or concession extensions including the issuance of guidance by the Macau Government. MGM China intends to respond proactively to all relevant Macau Government requirements when known relating to the retendering process. We cannot provide any assurance that the gaming subconcession will be extended beyond the current term or that we will be able to obtain a gaming concession in a public tender; however, management believes that MGM Grand Paradise will be successful in obtaining a gaming concession when a public tender is held.

Corporate and Other

We have additional business activities including our investments in unconsolidated affiliates, and certain other corporate and management operations. Our unconsolidated affiliates include the ventures with BREIT, discussed elsewhere, and BetMGM. In September 2021, we completed the acquisition of 25 years.the 50% ownership interest in CityCenter held by Infinity World and now own 100% of the equity interest in CityCenter. Accordingly, we no longer account for our interest in CityCenter under the equity method of accounting, and we now consolidate CityCenter in our financial statements.

5

Our Operating Resorts

We have provided certain information below about our resorts as of December 31, 2021.

Name and LocationNumber of Guestrooms and Suites
Approximate Casino Square Footage(1)
Slots (2)
Gaming Tables (3)
Las Vegas Strip Resorts:    
Aria(4)
5,497142,0001,316121
Bellagio3,933152,0001,312146
MGM Grand Las Vegas (5)
6,071169,0001,245122
Mandalay Bay (6)
4,750152,00099069
The Mirage3,04494,00083571
Luxor4,397101,00081945
Excalibur3,98193,00089442
New York-New York2,02481,00089354
Park MGM (7)
2,89866,00074565
Subtotal36,5951,050,0009,049735
Regional Operations:    
MGM Grand Detroit (Detroit, Michigan) (8)
400147,0002,817140
Beau Rivage (Biloxi, Mississippi)1,74085,0001,51675
Gold Strike Tunica (Tunica, Mississippi)1,10957,0001,08261
Borgata (Atlantic City, New Jersey)2,767213,0002,816163
MGM National Harbor (Prince George's County, Maryland) (9)
308150,0002,123158
MGM Springfield (Springfield, Massachusetts)(10)
240106,0001,57152
MGM Northfield Park (Northfield, Ohio)—73,0001,669—
Empire City (Yonkers, New York)—137,0004,696—
Subtotal6,564968,00018,290649
MGM China:    
MGM Macau – 55.95% owned (Macau S.A.R.)
585307,0001,017289
MGM Cotai – 55.95% owned (Macau S.A.R.)1,418298,0001,026263
Subtotal2,003605,0002,043552
Grand total45,1622,623,00029,3821,936
(1)Casino square footage is approximate and includes the gaming floor, race and sports, high limit areas and casino specific walkways, and excludes casino cage and other non-gaming space within the casino area.
(2)Includes slot machines, video poker machines and other electronic gaming devices. Also include 172 and 187 gaming devices temporarily out of service due to COVID-19 restrictions at MGM Macau and MGM Cotai, is an integrated casino, hotelrespectively.
(3)Includes blackjack (“21”), baccarat, craps, roulette and entertainment resort that opened on February 13, 2018. The Gaming Inspection and Coordination Bureau of Macau (“DICJ”) approved 100other table games; does not include poker. MGM China gaming tables forreflect the openingpermanent table count, excludes temporary tables.
(4)Includes 1,495 condominium-hotel units at Vdara, which are predominantly utilized as company-owned hotel rooms.
(5)Includes 1,078 rooms at The Signature at MGM Grand Las Vegas.
(6)Includes 1,117 rooms at the Delano and 424 rooms at the Four Seasons Hotel.
(7)Includes 293 rooms at NoMad Las Vegas.
(8)Our local investors have an ownership interest of approximately 3% of MGM Cotai and 25 additional gaming tables effectiveGrand Detroit.
(9)Our local investors have a non-voting economic interest in MGM National Harbor. Refer to Note 2 in the accompanying consolidated financial statements for operation on January 1, 2019, forfurther description of such interest.
(10)Our local investor has a total of 125 gaming tablesnon-voting economic interest in aggregate. In addition, the DICJ approved the initial transfer of 77 gaming tables from MGM Macau to MGM Cotai. We expect total development costs of our Cotai project to be approximately $3.4 billion, excluding development fees eliminated in consolidation, capitalized interest and land-related costs.

Springfield.


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Customers and Competition


Our casino resortsproperties operate in highly competitive environments. We compete against gaming companies, as well as other hospitality companies in the markets in which we operate, neighboring markets, and in other parts of the world, including non-gaming resort destinations such as Hawaii. Our gaming operations compete to a lesser extent with state-sponsored lotteries, off-track wagering, card parlors, online gamblingiGaming and other forms of legalized gaming in the United States and internationally.

For further discussion of the potential impact of competitive conditions on our business, see “Item 1A. Risk Factors — Risks Related to our Business, Industry, and Market Conditions — We face significant competition with respect to destination travel locations generally and with respect to our peers in the industries in which we compete, including increased competition through online sports betting and iGaming, and failure to compete effectively could materially adversely affect our business, financial condition, results of operations and cash flow.”


Our primary methods of successful competition include:

•Locating our resorts in desirable leisure and business travel markets and operating at superior sites within those markets;

•Constructing and maintaining high-quality resorts and facilities, including luxurious guestrooms, state-of-the-art convention facilities and premier dining, entertainment, retail and other amenities;

•Recruiting, training and retaining well-qualified and motivated employees who provide superior customer service;

•Providing unique, “must-see” entertainment attractions; and

•Developing distinctive and memorable marketing, promotional and customer loyalty programs.


       Domestic

Las Vegas Strip Resorts

and Regional Operations


Our customers include premium gaming customers; leisure and wholesale travel customers; business travelers, and group customers, including conventions, trade associations, and small meetings. We have a completediverse portfolio of resortsproperties, which appeal to the upper end of each market segment and also cater to leisure and value-oriented tour and travel customers. Many of our resortsproperties have significant convention and meeting space which we utilize to drive business to our resortsproperties during mid-weekmidweek and off-peak periods.


Our Las Vegas casino resorts compete for customers with a large number of other hotel casinos in the Las Vegas area, including major hotel casinos on or near the Las Vegas Strip, major hotel casinos in the downtown area, which is about five miles from the center of the Las Vegas Strip, and several major hotel casinos elsewhere in the Las Vegas area. Our Las Vegas Strip resortsResorts also compete, in part, with each other. Major competitors, including new entrants, have either recently expanded their hotel room capacity and convention space offerings, or have plans to expand their capacity or construct new resorts in Las Vegas. Also, the growth of gaming in areas outside Las Vegas has increased the competition faced by our operations in Las Vegas.


Outside Nevada, our resorts primarily compete with other hotel casinos in their markets and for customers in surrounding regional gaming markets, where location is a critical factor to success. In addition, we compete with gaming operations in surrounding jurisdictions and other leisure destinations in each region.


MGM China


The three primary customer bases in the Macau gaming market are VIP casino gaming operations, main floor gaming operations and slot machine operations. VIP gaming play ishas historically been sourced both internally and externally. Externally sourced VIP gaming play iswas obtained through external gaming promoters who offerassist VIP players various services, such as extension of credit as well as complimentary hotel, foodwith their travel and beverage services.entertainment arrangements. Gaming promoters arehave been compensated through payment of revenue-sharing arrangements and rolling chip turnover basedturnover-based commissions. In-house VIP players also typically receive a commission based on the program in which they participate. Unlike gaming promoters and in-house VIP players, main floor players do not receive commissions. The profit contribution from the main floor segment exceedsgaming operations has historically exceeded the VIP segmentgaming operations due to commission costs paid to gaming promoters. Gaming revenues from the main gaming floors have grown significantly in recent years and we believe this customer base represents the most potential for sustainable growth in the future. To target premium main floorWe offer amenities to attract players in order to grow revenue and improve yield, we have introducedsuch as premium gaming lounges and stadium-style electronic table games terminals, which include both table games and slots to the main floor gaming area. The amenities create a dedicated exclusive gaming space for premium main floor players’ use, as well as non-gaming amenities, such as The Mansion and MGM Cotai Emerald Villa to attract ultra-high end customers.

VIP gaming at MGM China is conducted by the use of premiumspecial purpose nonnegotiable gaming chips. Gaming promoters currently purchase these nonnegotiable chips and in turn they sell these chips to their players. The nonnegotiable chips allow us to track the amount of wagering conducted by each gaming promoters’ clients in order to determine VIP gaming play. Gaming promoter commissions are currently based on a percentage of the gross table games win or a percentage of the table games turnover they generate. They also receive a complimentary allowance based on a percentage of the table games turnover they generate, which can be applied to hotel rooms, food and beverage and other discretionary
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customer-related expenses. Gaming promoter commissions are recorded as a reduction of casino revenue. In-house VIP commissions are based on a percentage of rolling chip turnover and are recorded as a reduction of casino revenue.

In December 2021, we suspended operations with our primary gaming promoters. In January 2022, the Macau Government disclosed the content of a bill to amend the gaming law which includes some restrictions relating to gaming promoters, including: each gaming promoter can only exercise the activity of gaming promotion for one concessionaire, revenue sharing arrangements between concessionaires and gaming promoters are prohibited, gaming promoters are prohibited from having exclusive operation of casino reserved areas, and gaming promoters are restricted to only providing support to the concessionaires in the promotion of casino gaming activities through commissions. The bill is subject to debate and approval by the Macau Legislative Assembly.

We have focused our business on main floor players.  

gaming operations and, accordingly, we do not expect VIP gaming operations to be a significant source of revenue in future years. The majority of MGM China's casino revenue has been provided by main floor gaming operations in recent years and we expect this customer base will be the primary source of growth in the future.


Our key competitors in Macau include five other gaming concessionaires and subconcessionaires. If the Macau government were to grant additional concessions or subconcessions, we would face additional competition which could have a material adverse effect on our financial condition, results of operations or cash flows. Additionally, we face competition at our Macau and Cotai properties from concessionaires who have expanded their operations, primarily on the Cotai Strip, with several openings having occurred during 2016 and another casino resort expected to open in 2019.

Strip.


We encounter competition from major gaming centers located in other areas of Asia and around the world including, but not limited to, Singapore, South Korea, Australia, New Zealand, Malaysia, Vietnam, Cambodia, the Philippines, Russia, cruise ships in Asia that offer gamingAustralia, and from unlicensed gaming operations in the region.

       Corporate and Other

Much like our domestic resorts, our unconsolidated affiliates compete through the quality of amenities, the value of the experience offered to guests and the location of their resorts. We manage and own 50% of CityCenter, which includes Aria casino resort. Aria appeals to the upper end of each segment in the Las Vegas market and competes with our domestic casino resorts and other resorts on the Las Vegas Strip. Grand Victoria, our other unconsolidated affiliate, mainly competes for customers against casino resorts in the Chicago metropolitan market.

Vegas.


Marketing


Our marketing efforts are conducted through various means, including our loyalty programs. We advertise on radio, television, internet and billboards and in newspapers and magazines in selected cities throughout the United States and overseas, as well as by direct mail, email and through the use of social media. We also advertise through our regional marketing offices located in major U.S. and foreign cities. Our direct marketing efforts utilize advanced analytic techniques that identify customer preferences and help predict future customer behavior, allowing us to make more relevant offers to customers, influence incremental visits, and help build lasting customer relationships.

M life


MGM Rewards, our customer loyalty program, is a tiered program and allows customers to qualify for benefits across our participating resorts and in both gaming and non-gaming areas, encouraging customers to keep their total spend within our casino resorts. In January 2022, we redesigned our loyalty program to expand the ways in which our customers can earn benefits. We also offer the Golden Lion Club for gaming focused customers, in addition to M life Rewards, at MGM Macau and MGM Cotai.China. The structured rewards systems based on member value and tier level ensure that customers can progressively access the full range of services that the resorts provide. Our loyalty programs focus on building a rewarding relationship with our customers, encouraging members to increase both visitation and spend.


Strategy


We strive to be the recognized globala leader in the global gaming, entertainment and hospitality embracing innovationindustry that delivers extraordinary entertainment across a portfolio of properties in the United States and diversity to inspire excellence. Macau. The quality of our resortsproperties and amenities can be measuredis evidenced by our success in winning numerous awards, both domestic and globally, including several Four and Five Diamond designations from the American Automobile Association, as well as multiple Four and Five Star designations from Forbes Travel Guide as well asand numerous certifications of our Corporate Social Responsibility efforts.

Our


In order to achieve our vision of becoming the world's premier gaming entertainment company, we developed our strategic objectives include:

plan, which centers on four pillars:

Operational enhancements. Drive continuous improvements in operational performance to support enterprise-wide increases in revenue, market share, cash flow,•Strong People and margins;

Financial strength.Accelerate financial performance through optimal capital structureCulture. Recruit, develop and disciplined investmentretain the best talent. Foster a culture of cash flows;

Corporate social responsibility. Continue to solidify the Company’s reputation as a global leaderdiversity and inclusion. Invest in the principles of Corporate Social Responsibility;

employee experience.

Geographic expansion. Execute•Customer-Centric Model. Leverage a targeted approachcustomer-centric model reinforced by a strong brand and deep customer insights to domestic and international expansion to increase global brand presence; and

Business model innovation. Explore the evolution of the existing business model into new lines of business and key adjacencies.

Technology

Collectively we utilize various types of technology to maximize revenue, drive efficiency in our operations, and serve our customers more effectively. Information Technology continues to automate operations in an effort to control costs related to operations and implement leading edge solutionsprovide unmatched entertainment experiences for all major lines of business. To aid this process, data and analytics are utilized to support making timely and accurate business decisions. A cloud first strategy is applied when possible to enable our technology solution delivery and speed to market.

Technology is focused to enhance the guest experience. We implemented a Mobile Check-In process which has been well-received by our guests and are developing a self-service Check-In workstation program at select locations. Another areadrive top-line growth.

•Operational Excellence. Operating model refinement to maximize operating efficiencies and expand margins. Enhancement of concentration includes increasing our wireless networkdigital capabilities within our convention offerings with next generation equipment to further subscribestrengthen customer loyalty.
•Disciplined Capital Allocation to Maximize Shareholder Value. Pursuit of targeted, attractive ROI opportunities that align to our guests’ needs. We also continuestrategic vision. Focus on shareholder returns. Fortify balance sheet.

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Due to enhancethe COVID-19 pandemic and the resulting rapidly changing environment, our eCommerce platform which provides our guestsstrategic direction must allow for flexibility. The strategic plan was developed with the intent to regularly revisit, measure, and business partners a premier digital experience where they have the ability to create an all-inclusive experience from accommodations to dining and entertainment with real time recommendations provided based on the preference.

Employees and Management

We believe that knowledgeable, friendly and dedicated employees are a primary success factor in the hospitality industry. Therefore, we invest heavily in recruiting, training, motivating and retaining exceptional employees, and we seek to hire and promote the strongest management team possible. We have numerous programs, both at the corporate and business unit level, designed to achieve these objectives. We believe our internal development programs, such as the MGM Resorts University and various leadership and management training programs, are best in class among our industry peers.


Corporate Social Responsibility

We seek to conduct our business in an ethical and socially responsible way, through sustainable business practices, which we regard as essential to maximizing shareholder value, while enhancing community quality and environmental stewardship. Our corporate social responsibility efforts are overseen by the Corporate Social Responsibility Committee of our Board of Directors.  

Diversity and inclusion. Diversity and inclusion are fundamental to our Company’s value system, our people philosophy, our cultural life and therefore, our competitive advantage as an employer and destination of choicereevaluate for our global customer base. Our inclusion initiative at our resorts fosters employee engagement, individual responsibility, team collaboration, leadership competency, high performance and innovation. Our diversity and inclusion initiative has been widely recognized for many years through numerous awards and accolades.

Philanthropy and community engagement. Our host community and social investments are prioritized to strengthen the communities where our employees live, work and care for their families. Our community platform features three main programs: our Corporate Giving Program, our employee-driven MGM Resorts Foundation and our Employee Volunteer Program. Through these channels, we make financial and in-kind donations, contribute volunteer service and participate in civic and non-profit organizations and issues that advance the quality of life in our communities. Key investment areas include hunger relief, diversity, public education, health and wellness and environmental sustainability.

Environmental sustainability. We continue to gain recognition for our comprehensive environmental responsibility initiatives in energy and water conservation, recycling and waste management, sustainable supply chain and green building. Certain of our casino resorts in Nevada and our casino resort in Michigan were the first in each state to earn certification from Green Key, the largest international program evaluating environmental sustainability in hotel operations. We received certifications at all of our domestic resorts and Aria and Vdara at CityCenter. Aria, Vdara, Bellagio, Delano, and Mandalay Bay, Mirage, and MGM Grand Detroit have all received “Five Green Key,” the highest possible rating. Many major travel service providers recognize the Green Key designation and identify our resorts for their continued commitment to sustainable hotel operations. 

In addition, we believe that incorporating the tenets of environmental sustainability in our business decisions advances a platform for innovation and operational efficiency. CityCenter (Aria, Vdara, Veer and Mandarin Oriental Las Vegas) is one of the world’s largest private sustainable developments. With six LEED® Gold certifications from the U.S. Green Building Council (the “Council”), CityCenter serves as the standard for combining luxury and environmental responsibility within the large-scale hospitality industry. Also, MGM National Harbor, The Park, and T-Mobile Arena have all been awarded LEED® Gold certification by the Council.

At MGM China, we incorporate the same commitment to environmental preservation. Our efforts to improve energy efficiency, indoor air quality, and environmental stewardship have resulted in MGM China being included in the Hang Seng Corporate Sustainability Benchmark Index on the Hong Kong Stock Exchange. MGM Cotai, our new integrated resort, has achieved the China Green Building (Macau) Design label from the China Green Building and Energy Saving (Macau) Association.

The construction of MGM Springfield will further position MGM Resorts as a leader in sustainable resort operations, and by adopting innovative technologies in the design and operating practices of this resort, we are advancing our commitment to protecting our planet in new regions.

Development and Leveraging Our Brand and Management Assets

emerging opportunities.


In allocating resources, our financial strategy is focused on managing a proper mix of investinginvestments in our existing resorts, spending on new resortsproperties, strategic growth opportunities, debt repayment and other developments or initiatives and repaying long-term debt or returning capital to shareholders.shareholder returns. We believe there are reasonable investments for us to make in new initiatives and at our current resorts that will provide profitable returns.


We regularly evaluate possible expansion and acquisitiontargeted opportunities that provide an attractive return on investment in domestic and international markets. Opportunities we evaluate may includemarkets, including the ownership, management and operation of gaming facilities and other entertainment facilities in Nevada, or in states other than Nevada, or outside of the United States.accessing new markets for iGaming and online sports betting. We also leverage our management expertise and well-recognized brands through strategic partnerships and international expansion opportunities. We feel that several of our brands are well-suited to new projects in both gaming and non-gaming developments. We may undertake these opportunities either alone or in cooperation with one or more third parties.



MGM Springfield

We continue to invest in our operating model by expanding the footprint of our Centers of Excellence and enabling best in class operations through adjustments within corporate and property business units. In addition, we have implemented several improvement and cost cutting initiatives comprised of labor, sourcing, and revenue programs that have further improved our operating model and have positioned us as a stronger company.

We have continued to focus on our key growth opportunities of developing an integrated resort in Japan and investing in BetMGM. In September 2021, we, together with our venture partner, ORIX, were awardedselected by Osaka as the region’s integrated resort partner. This selection marks an important step in our long-term bid to develop one of Japan’s first integrated casino resorts. We are currently working with Osaka to submit an area development plan to the central government during the application period. As it relates to BetMGM, we believe that BetMGM is positioned as a casino license to build and operate MGM Springfield in Springfield, Massachusetts. MGM Springfield is being developed on approximately 14 acres of land in downtown Springfield. Plans for the resort currently include a casino with approximately 2,550 slots and 120 table games including poker; a 250-room hotel; 100,000 square feet of retail and restaurant space; 44,000 square feet of meeting and event space; and a 3,500-space parking garage, with an expected development and construction cost of approximately $960 million, excluding capitalized interest and land-related costs. Construction of MGM Springfield is expected to be completedlong-term leader in the third quarterU.S. online sports betting and iGaming industries. As part of 2018.

Intellectual Property

our commitment to the success of BetMGM, we have integrated our MGM Rewards program with BetMGM and have BetMGM branded on-property sportsbooks and kiosks to drive higher value customers at lower acquisition costs through a robust omni-channel strategy. Further, we continue to explore bringing full-scale commercial gaming to Empire City in New York.


Technology

We believe technology, digital and advanced data science/analytics capabilities are critical to optimizing customer experience and loyalty, employee productivity and engagement, operational efficiency and revenue growth. We are focused on using these capabilities to achieve specific goals of creating ‘only at MGM’ differentiation through unique content and experiences, establishing a perennial engagement with our guests for increased loyalty, digital diversification through enhanced e-commerce and seamless integration of the physical integrated resorts business with digital casino and sports betting businesses, creating cross-property experiences and promotions in Las Vegas to provide much better value to the consumer, enhancing our data driven decisioning capabilities in all aspects of our business for faster decision making, and optimizing our operations and employee productivity and experience through digitization.

Environmental & Social Responsibility

At MGM Resorts we have had a long-standing commitment to environmental and social responsibility. For over a decade, we have had a dedicated board committee focused on Corporate Social Responsibility (“CSR”). In 2019, we had bolstered governance of these topics by uniting our key pillars of Diversity and Inclusion, Philanthropy and Community Engagement and Environmental Sustainability under one Executive Committee-level leader who manages the MGM Resorts Social Impact and Sustainability Center of Excellence, reports directly to the Chief Executive Officer and President, and serves as liaison to the CSR and Sustainability board committee. This leader now also oversees the Human Resources function, and is thus able to integrate Environmental, Social and Governance (“ESG”) considerations more deeply into the core culture of our organization.

The year 2021 was a critical one in terms of progress on our ESG initiatives. In May 2021, we published our 2020 Social Impact & Sustainability Report containing our most robust ESG disclosures to date. In this report we showed the significant progress made towards many of our ESG goals that we had announced publicly in prior reports, and we expect to publish a report in 2022 reflecting our progress on these goals during 2021.

Importantly, 2021 saw the opening of the 100MW “MGM Resorts Mega Solar Array” in North Las Vegas. This is the hospitality industry’s largest direct-connect renewable electricity project world-wide and has significantly improved our trajectory to achieve our previously announced carbon reduction goals. In connection with the opening of this array, we enhanced our climate ambition by announcing two new 2030 goals: to cut global total operational carbon emissions by
9

50%, and source 100% renewable electricity in the USA. Beyond the environmental benefits associated with the renewable electricity generated, the array will also help us hedge our electricity costs and reduce our exposure to price volatility risks.

In 2021, we also made substantial progress against our commitment to aligning more of our ESG report disclosures to leading ESG frameworks by publishing our first ever disclosures informed by guidelines of the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB) Hotels & Lodging and Casinos & Gaming Sector Standards.

Our full list of ESG goals and performance against them are available in our 2020 Social Impact & Sustainability Report, available at mgmresorts.com/focused. The content on this website and report is for informational purposes only and such content is not incorporated by reference into this Annual Report on Form 10-K.

Trademarks

Our principal intellectual property consists of trademarks for, among others, Aria, Vdara, Bellagio, The Mirage, Borgata, Mandalay Bay, MGM, MGM Grand, MGM Resorts International, Luxor, Excalibur, New York-New York, Circus CircusBeau Rivage and Beau Rivage,Empire City, all of which have been registered or allowed in various classes in the United States. In addition, we have also registered or applied to register numerous other trademarks in connection with our properties, facilities and development projects in the United States and in various other foreign jurisdictions. These trademarks are brand names under which we market our properties and services. We consider these brand names to be important to our business since they have the effect of developing brand identification. We believe that the name recognition, reputation and image that we have developed attract customers to our facilities. Once granted, our trademark registrations are of perpetual duration so long as they are used and periodically renewed. It is our intent to pursue and maintain our trademark registrations consistent with our goals for brand development and identification, and enforcement of our trademark rights.


Human Capital

We are focused on fostering a people-driven culture exemplified by how we lead and uphold our core values, which in 2021 evolved to: captivate our audience, inspire excellence, champion inclusion, and win together, to create an engaged and diverse workforce. Our long-term people strategy is designed to enhance talent attraction and development to support business objectives, guest experience, community engagement, and financial goals. Our workforce development strategies support local hiring and developing a robust workforce in the local communities in which we operate through veteran support, community training and employment, fulfilling local hiring commitments (where applicable), and through internship and management development programs.

Growth and Development

We invest significant resources to develop the talent needed, now and in the future, to continue to be a premier employer of choice across the gaming, hospitality, and entertainment industries. We are committed to a culture of continuous learning where employees, at all levels, are engaged in developing their knowledge, skills, and abilities and we support the long-term career aspirations of our employees through education and professional/personal development. In 2021, we introduced several new learning and development initiatives focused on a broad range of employee segments. Except as otherwise temporarily impacted due to COVID-19, we offer tuition reimbursement, contribute toward student loan debt repayment, and have partnered with the Nevada System of Higher Education to allow employees to earn a degree online free of charge for all credit hours.

Equity, Diversity, and Inclusion (“ED&I”)

Our approach to ED&I is anchored by our corporate and people strategies and a social impact and sustainability approach that centers on embracing humanity and protecting the planet. A concise framework lays out four strategic pillars to guide our work: invest in people; build an inclusive culture; grow business and customer engagement and supplier diversity; and, enhance marketplace leadership and community relations. As part of our commitment, we have committed to the following four long-range goals: (1) ensure that all employees have equal access to leadership opportunities, (2) spend at least 10% of our biddable procurement with diverse suppliers, (3) expand our Supplier Diversity Mentorship Program to achieve 50 graduates and (4) train 100% of management employees on social impact policies and goals. In connection with each goal, we have established robust key performance indicators, which are tracked and published in our annual Social Impact and Sustainability Report.In addition, we have detailed internal Human Capital workforce reports, which include demographic and diversity data, and are reviewed with the Corporate Social Responsibility and Sustainability Committee of the Board, leadership teams and executive management on a regular basis.

10

Internally, we use multiple channels to facilitate communication and to continuously advance our core value of inclusiveness. The channels include but are not limited to open forums with executives, employee engagement surveys with detailed action planning, and employee network groups.

Work in the area of equity, diversity and inclusion is advanced through a range of programs and initiatives which include education and training, community partnerships, recruitment and talent development, advocacy, engagement and outreach. Responsibility is driven and led by the Company’s Chief People, Inclusion and Sustainability Officer, who reports directly to the Chief Executive Officer and President, and is supported by a centralized diversity and inclusion team and the Human Resources department.

Health, Safety, and Wellness

In order to promote our culture of overall employee health and wellness we provide benefits, tools and resources to help maintain or improve physical, mental, and financial health. We continue to align benefit offerings to the needs of a diverse workforce across an expanded regional presence and leverage innovative solutions to expand access to health and wellness resources, including the recent addition of a service to help connect LGBTQIA+ people and their loved ones with culturally and clinically competent health care providers.

To ensure our employees' continued health, safety, and wellness in response to COVID-19, we coordinated with medical experts to put in place extensive testing protocols for our employees and required COVID-19 vaccination as a condition of employment for all salaried employees and new hires throughout the United States. As a commitment to our employees impacted by the pandemic, we have maintained benefits eligibility for many employees who were furloughed in 2020 and were unable to work enough hours to qualify for benefits until business conditions improved.

Community Engagement and Philanthropy

Our philanthropic focus centers around: Embracing Humanity and Protecting the Planet. We organize our major programs and initiatives under the pillars of caring for one another and investing in the community. We established the MGM Resorts Foundation in 2002 as an engagement opportunity for employees to contribute to charitable causes, which provides two types of grants (1) the Employee Emergency Grant, which benefits our employees, and (2) the Community Grant, which benefits local communities. We endeavor to care for our communities through volunteerism and philanthropy and encourage all of our employees to volunteer through a variety of programs. In addition, we offer opportunities for our employees to give back to their communities, including through programs such as VolunteerREWARDS, which provides employees with opportunities to earn grant money to their charity of choice based on volunteer hours.

Employees and Labor Relations


As of December 31, 2017,2021, we had approximately 51,00042,000 full-time and 17,000 part-time employees domestically, of which 6,000 and 2,000, respectively, support the Company’s management agreements with CityCenter.domestically. In addition, we had approximately 9,00010,000 employees at MGM China. We had collective bargaining agreements with unions covering approximately 36,00035,000 of our employees as of December 31, 2017.2021. Collective bargaining agreements with three unions covering a significant number ofmultiple bargaining units at our employees inRegional Operations and Las Vegas Strip Resorts are scheduled to expire in the first half of 2018. We began negotiations with2022. This includes all three unionsbargaining units at Gold Strike Tunica in the first quarter of 2018. In addition, Beau Rivage is currently engagedMississippi, all bargaining units at Borgata in negotiations for an initial collectiveAtlantic City, our hotel/food & beverage bargaining agreement with a council of unions representing various hotel and food and beverage constituencies, Borgata will be engaged in negotiations with three unions in 2018, andunit at MGM National Harbor, isand all valet operations in negotiations with one union.Las Vegas (with the exception of The Signature). Negotiations for successor contracts covering those employees are being scheduled as expiration dates approach and will continue throughout 2022. As of December 31, 2017,2021, none of the employees of MGM China are part of a labor union and the MGM China resorts are not party to any collective bargaining agreements.


Government Regulation and Licensing


The gaming industry is highly regulated, and we must maintain our licenses and pay gaming taxes to continue our operations. Each of our casinos is subject to extensive regulation under the laws, rules and regulations of the jurisdiction in which it is located. These laws, rules and regulations generally concern the responsibility, financial stability and character of the owners, managers, and persons with financial interest in the gaming operations. Violations of laws in one jurisdiction could result in disciplinary action in other jurisdictions.


A more detailed description of the gaming regulations to which we are subject is contained in Exhibit 99.299.1 to this Annual Report on Form 10-K, which Exhibit is incorporated herein by reference.


Our businesses are subject to various federal, state, local and foreign laws and regulations affecting businesses in general. These laws and regulations include, but are not limited to, restrictions and conditions concerning alcoholic beverages, smoking, employees, currency transactions, taxation, zoning and building codes (including regulations under
11

the Americans with Disabilities Act, which requires all public accommodations to meet certain federal requirements related to access and use by persons with disabilities), construction, land use and marketing and advertising. We also deal with significant amounts of cash in our operations and are subject to various reporting and anti-money laundering regulations. Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Material changes, new laws or regulations, or material differences in interpretations by courts or governmental authorities could adversely affect our operating results.


In addition, we are subject to certain federal, state and local environmental laws, regulations and ordinances, including the Clean Air Act, the Clean Water Act, the Resource Conservation Recovery Act, the Comprehensive Environmental Response, Compensation and Liability Act and the Oil Pollution Act of 1990. Under various federal, state and local laws and regulations, an owner or operator of real property may be held liable for the costs of removal or remediation of certain hazardous or toxic substances or wastes located on its property, regardless of whether or not the present owner or operator knows of, or is responsible for, the presence of such substances or wastes. We have not identified any issues associated with our properties that could reasonably be expected to have an adverse effect on us or the results of our operations.



For a discussion of potential risks to our business relating to regulatory matters, including due to the potential impact of legislative and regulatory changes, please see “Item 1A. Risk Factors — Risks Related to Legal and Regulatory Matters and Changes in Public Policy.”

Cautionary Statement Concerning Forward-Looking Statements


This Form 10-K and our 20172021 Annual Report to Stockholders contain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “will,” “may” and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements we make regarding expected market growth in Macau,the impact of COVID-19 on our business, our ability to reduce expenses and otherwise maintain our liquidity position during the pandemic, our ability to generate significant cash flow, and execute on ongoing and future projects,strategic initiatives, including the development of an integrated resort in Japan and investments we make in online sports betting and iGaming, the closing of the VICI Transaction, The Cosmopolitan transaction, and The Mirage transaction, amounts we will spend inon capital expenditures and investments, the opening of strategic resort developments, the estimated costs and components associated with those developments, our expectations with respect to future share repurchases and cash dividends on our common stock, dividends and distributions we will receive from MGM China or the Operating Partnership, or CityCenterour ability to achieve the benefits of our cost savings initiatives, and amounts projected to be realized as deferred tax assets. The foregoing is not a complete list of all forward-looking statements we make.


Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. Therefore, we caution you against relying on any of these forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, regional, national or global political, economic, business, competitive, market, and regulatory conditions and the following:


•our substantial indebtedness and significant financial commitments, including the fixed component of our rent payments tounder our triple-net leases and guarantees we provide of the indebtedness of Bellagio BREIT Venture and MGP BREIT Venture could adversely affect our development options and financial results and impact our ability to satisfy our obligations;

•current and future economic, capital and credit market conditions could adversely affect our ability to service or refinance our substantial indebtedness and significant financial commitments, including the fixed components of our rent payments, and to make planned expenditures;

•restrictions and limitations in the agreements governing our senior credit facility and other senior indebtedness could significantly affect our ability to operate our business, as well as significantly affect our liquidity;

•the fact that we are required to pay a significant portion of our cash flows as fixed and percentage rent, under the master lease, which could adversely affect our ability to fund our operations and growth, service our indebtedness and limit our ability to react to competitive and economic changes;

•the VICI Transaction, The Cosmopolitan transaction, and The Mirage transaction each remain subject to the satisfaction of certain closing conditions, including the receipt of certain regulatory approvals, and any anticipated benefits from such transactions may take longer to realize than expected or may not be realized at all;
•potential litigation instituted against us, our transaction counterparties, or our respective directors challenging the VICI Transaction may prevent such transaction from becoming effective within the expected timeframe or at all;
12

•the global COVID-19 pandemic has continued to materially impact our business, financial results and liquidity, and such impact could worsen and last for an unknown period of time;

•significant competition we face with respect to destination travel locations generally and with respect to our peers in the industries in which we compete;

the fact that our businesses are subject to extensive regulation and the cost of compliance or failure to comply with such regulations could adversely affect our business;

•the impact on our business of economic and market conditions in the jurisdictions in which we operate and in the locations in which our customers reside;

•the possibility that we may not realize all of the anticipated benefits of our ability to sustain continued improvement efforts;

cost savings initiatives, including our MGM 2020 Plan, or our asset light strategy;

•the fact that our ability to pay ongoing regular dividends is subject to the discretion of our board of directors and certain other limitations;

a significant number•All of our domestic gaming facilities are leased and could experience risks associated with leased property, including risks relating to lease termination, lease extensions, charges and our relationship with the lessor, which could have a material adverse effect on our business, financial position or results of operations;

•financial, operational, regulatory or other potential challenges that may arise with respect to MGP, as our solethe lessor for a significant portion of our properties, may adversely impair our operations;

•the fact that MGP has adopted a policy under which certain transactions with us, including transactions involving consideration in excess of $25 million, must be approved in accordance with certain specified procedures;

•the concentration of a significant number of our major gaming resorts on the Las Vegas Strip;

•the fact that we extend credit to a large portion of our customers and we may not be able to collect such gaming receivables;

•the potential occurrence of impairments to goodwill, indefinite-lived intangible assets or long-lived assets which could negatively affect future profits;
•the susceptibility of leisure and business travel, especially travel by air, to global geopolitical events, such as terrorist attacks, other acts of violence, acts of war or hostility or outbreaks of infectious disease (including the COVID-19 pandemic);
•the fact that co-investing in properties or businesses, including our investment in BetMGM, decreases our ability to manage risk;
•the fact that future construction, development, or expansion projects will be subject to significant development and construction risks;
•the fact that our insurance coverage may not be adequate to cover all possible losses that our properties could suffer, our insurance costs may increase and we may not be able to obtain similar insurance coverage in the future;
•the fact that a failure to protect our trademarks could have a negative impact on the value of our brand names and adversely affect our business;
•the fact that a significant portion of our labor force is covered by collective bargaining agreements;
•the sensitivity of our business to energy prices and a rise in energy prices could harm our operating results;
•the potential failure of future efforts to expand through investments in other businesses and properties or through alliances or acquisitions, or to divest some of our properties and other assets;
•the potential that failure to maintain the integrity of our computer systems and internal customer information could result in damage to our reputation and/or subject us to fines, payment of damages, lawsuits or other restrictions on our use or transfer of data;
•the potential reputational harm as a result of increased scrutiny related to our corporate social responsibility efforts;
•extreme weather conditions or climate change may cause property damage or interrupt business;
•the fact that our businesses are subject to extensive regulation and the cost of compliance or failure to comply with such regulations could adversely affect our business;
•the risks associated with doing business outside of the United States and the impact of any potential violations of the Foreign Corrupt Practices Act or other similar anti-corruption laws;
•increases in gaming taxes and fees in the jurisdictions in which we operate;
•our ability to recognize our foreign tax credit deferred tax asset and the variability of the valuation allowance we may apply against such deferred tax asset;
•changes to fiscal and tax policies;
•risks related to pending claims that have been, or future claims that may be brought against us;
•restrictions on our ability to have any interest or involvement in gaming businesses in China, Macau, Hong Kong and Taiwan, other than through MGM China;

•the ability of the Macau government to terminate MGM Grand Paradise’s subconcession under certain circumstances without compensating MGM Grand Paradise, exercise its redemption right with respect to the subconcession, or refuse to grant MGM Grand Paradise an extension of the subconcession in 2020;

2022; and

the dependence of MGM Grand Paradise upon gaming promoters for a significant portion of gaming revenues in Macau;

changes to fiscal and tax policies;

our ability to recognize our foreign tax credit deferred tax asset and the variability of the valuation allowance we may apply against such deferred tax asset;

extreme weather conditions or climate change may cause property damage or interrupt business;

the concentration of a majority of our major gaming resorts on the Las Vegas Strip;

the fact that we extend credit to a large portion of our customers and we may not be able to collect such gaming receivables;


•

the potential occurrence of impairments to goodwill, indefinite-lived intangible assets or long-lived assets which could negatively affect future profits;

the susceptibility of leisure and business travel, especially travel by air, to global geopolitical events, such as terrorist attacks, other acts of violence or acts of war or hostility;

the fact that co-investing in properties, including our investment in CityCenter, decreases our ability to manage risk;

the fact that future construction, development, or expansion projects will be subject to significant development and construction risks;

our ability to commence operations at MGM Springfield on the required timeline;

the fact that our insurance coverage may not be adequate to cover all possible losses that our properties could suffer, our insurance costs may increase and we may not be able to obtain similar insurance coverage in the future;

the fact that a failure to protect our trademarks could have a negative impact on the value of our brand names and adversely affect our business;

the risks associated with doing business outside of the United States and the impact of any potential violations of the Foreign Corrupt Practices Act or other similar anti-corruption laws;

risks related to pending claims that have been, or future claims that may be brought against us;

the fact that a significant portion of our labor force is covered by collective bargaining agreements;

the sensitivity of our business to energy prices and a rise in energy prices could harm our operating results;

the potential that failure to maintain the integrity of our computer systems and internal customer information could result in damage to our reputation and/or subject us to fines, payment of damages, lawsuits or other restrictions on our use or transfer of data;

the potential reputational harm as a result of increased scrutiny related to our corporate social responsibility efforts;

the potential failure of future efforts to expand through investments in other businesses and properties or through alliances or acquisitions, or to divest some of our properties and other assets;

increases in gaming taxes and fees in the jurisdictions in which we operate; and

•the potential for conflicts of interest to arise because certain of our directors and officers are also directors of MGM China, which is a publicly traded company listed on the Hong Kong Stock Exchange.

China.

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Any forward-looking statement made by us in this Form 10-K or our 20172021 Annual Report to Stockholders speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. If we update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements.


You should also be aware that while we from time to time communicate with securities analysts, we do not disclose to them any material non-public information, internal forecasts or other confidential business information. Therefore, you should not assume that we agree with any statement or report issued by any analyst, irrespective of the content of the statement or report. To the extent that reports issued by securities analysts contain projections, forecasts or opinions, those reports are not our responsibility and are not endorsed by us.


Information about our Executive Officers of the Registrant


The following table sets forth, as of March 1, 2018,February 25, 2022, the name, age and position of each of our executive officers. Executive officers are elected by and serve at the pleasure of the Board of Directors.


Name

Age

Position

JamesName

AgePosition
William J. Murren

Hornbuckle

56

64

Chairman and Chief Executive Officer

and President

Robert H. Baldwin

67

Chief Customer Development Officer

William J. Hornbuckle

60

President

Corey I. Sanders

54

58

Chief Operating Officer

Daniel J. D’Arrigo

Jonathan S. Halkyard

49

57

Executive Vice President and Chief Financial Officer

and Treasurer

Phyllis A. James

65

Executive Vice President, Chief Diversity and Corporate Responsibility Officer

John M. McManus

50

54

Executive Vice President, General Counsel and Secretary

Robert C. Selwood

Tilak Mandadi

62

58

Executive Vice PresidentChief Strategy, Innovation and Chief AccountingTechnology Officer


Mr. Murren has served as Chairman and Chief Executive Officer of the Company since December 2008 and as President from December 1999 to December 2012. He served as Chief Operating Officer from August 2007 through December 2008. He was Chief Financial Officer from January 1998 to August 2007 and Treasurer from November 2001 to August 2007.


Mr. BaldwinHornbuckle has served as Chief Customer DevelopmentExecutive Officer since August 2015. He served as Chief DesignJuly 2020 and Construction Officer from August 2007 to August 2015, Chief Executive Officer of Mirage Resorts from June 2000 to August 2007 and President and Chief Executive Officer of Bellagio, LLC from June 1996 to March 2005.

Mr. Hornbuckle has served as President since December 2012. He served as Acting Chief Executive Officer from March 2020 to July 2020, as Chief Operating Officer from March 2019 to March 2020, as President and Chief Customer Development Officer from December 2018 to February 2019, as Chief Marketing Officer from August 2009 to August 2014 and President and Chief Operating Officer of Mandalay Bay Resort & Casino from April 2005 to August 2009.


Mr. Sanders has served as Chief Operating Officer since December 2020. Previously, he served as Chief Financial Officer and Treasurer from March 2019 to January 2021, as Chief Operating Officer from September 2010. He served2010 through February 2019, as Chief Operating Officer for the Company’s Core Brand and Regional Properties from August 2009 to September 2010, as Executive Vice President—Operations from August 2007 to August 2009, and as Executive Vice President and Chief Financial Officer for MGM Grand Resorts from April 2005 to August 2007.


Mr. D’ArrigoHalkyard has served as Executive ViceChief Financial Officer and Treasurer since January 2021. Prior to joining the Company, Mr. Halkyard served as President and Chief Executive Officer of Extended Stay America, Inc. ("Extended Stay") and its paired-share REIT, ESH Hospitality, Inc., from January 2018 through November 2019, as Chief Financial Officer since August 2007 and as Treasurerof Extended Stay from September 2009 to June 2016. He served as Senior Vice President—Finance of the Company from February 2005 to August 2007 and as Vice President—Finance of the Company fromJanuary 2015 through December 2000 to February 2005.

Ms. James has served as Executive Vice President, Chief Diversity and Corporate Responsibility Officer since October 2016. She served as Executive Vice President and Special Counsel—Litigation from July 2010 to October 20162017, and as Chief DiversityOperating Officer since 2009. Sheof Extended Stay from September 2013 through January 2015. Prior to joining Extended Stay, Mr. Halkyard served as Senior Vice President, Senior CounselChief Financial Officer of NV Energy, Inc. from July 2012 through September 2013 and, then Deputy General Counsel of the Companyprior to that, he served in various executive, finance and managerial roles at Caesars Entertainment Inc. since 1999, including as Chief Financial Officer from March 2002 to July 2010.

2006 through 2012.


Mr. McManus has served as Executive Vice President, General Counsel and Secretary since July 2010. He served as Senior Vice President, Acting General Counsel and Secretary of the Company from December 2009 to July 2010. He served2010, as Senior Vice President, Deputy General Counsel and Assistant Secretary from September 2009 to December 2009. He served as Senior Vice President, Assistant General Counsel and Assistant Secretarya senior member of the CompanyCompany’s Corporate Legal Department from July 2008 to September 2009. HeDecember 2009, and he served as counsel to various MGM operating subsidiaries from May 2001 to July 2008.


Mr. SelwoodMandadi has served as Chief Strategy, Innovation and Technology Officer since July 2021. Prior to joining the Company, Mr. Mandadi served as Executive Vice President of Digital and Global Chief AccountingTechnology Officer since August 2007. Hefor Disney Parks, Experiences and Products, Inc. from March 2013. Prior to joining Disney, Mr. Mandadi served as Senior Vice President—AccountingPresident of theDigital for American Express Company from February 2005July 2006 to August 2007 and as Vice President—Accounting of the Company from December 2000 to February 2005.

March 2013.


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Available Information


We maintain a website at www.mgmresorts.com that includes financial and other information for investors. We provide access to our SEC filings, including our annual report on Form 10-K and quarterly reports on Form 10-Q (including related filings in XBRL format), filed and furnished current reports on Form 8-K, and amendments to those reports on our website, free of charge, through a link to the SEC’s EDGAR database. Through that link, our filings are available as soon as reasonably practicable after we file or furnish the documents with the SEC.

These filings are also available on the SEC’s website at www.sec.gov. In addition, the public may read and copy any materials that we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, D.C. 20549, and may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.


Because of the time differences between Macau and the United States, we also use our corporate website as a means of posting important information about MGM China.


References in this document to our website address do not incorporate by reference the information contained on the websites into this Annual Report on Form 10-K.


ITEM 1A.

RISK FACTORS


ITEM 1A.    RISK FACTORS

You should be aware that the occurrence of any of the events described in this section and elsewhere in this report or in any other of our filings with the SEC could have a material adverse effect on our business, financial position, results of operations and cash flows. In evaluating us, you should consider carefully, among other things, the risks described below.


Summary of Risk Factors

The following is a summary of the principal risks that could adversely affect our business, operations and financial results.

Risks RelatingRelated to Our Substantial Indebtedness

Financial Commitments

•Our substantial indebtedness and significant financial commitments, including the fixed component of our rent payments and guarantees we provide on the indebtedness of Bellagio BREIT Venture and MGP BREIT Venture could adversely affect our operations and financial results and impact our ability to satisfy our obligations.

•Current and future economic, capital and credit market conditions could adversely affect our ability to service our substantial indebtedness and significant financial commitments or make planned expenditures.
•The agreements governing our senior credit facility and other senior indebtedness contain restrictions and limitations that could significantly affect our ability to operate our business, as well as significantly affect our liquidity, and therefore could adversely affect our results of operations.
•We are required to pay a significant portion of our cash flows as rent, which could adversely affect our ability to fund our operations and growth initiatives, service our indebtedness and limit our ability to react to competitive and economic changes.

Risks Related to Our Announced Transactions

•The VICI Transaction, The Cosmopolitan transaction, and The Mirage transaction each remain subject to the satisfaction of certain closing conditions, including the receipt of certain regulatory approvals, and any anticipated benefits from such transactions may take longer to realize than expected or may not be realized at all.
•The potential litigation instituted against us, our transaction counterparties, or our respective directors challenging the VICI Transaction may prevent such transaction from becoming effective within the expected timeframe or at all.

Risks Related to Our Business, Industry, and Market Conditions

•The global COVID-19 pandemic has continued to materially impact our business, financial results and liquidity, and such impact could worsen and last for an unknown period of time.
•We face significant competition with respect to destination travel locations generally and with respect to our peers in the industries in which we compete, including increased competition through online sports betting and iGaming, and failure to compete effectively could materially adversely affect our business, financial condition, results of operations and cash flows.
•Our business is affected by economic and market conditions in the jurisdictions in which we operate and in the locations in which our customers reside.
•We may not realize all of the anticipated benefits of our cost savings initiatives, including those associated with our MGM 2020 Plan.
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•Our ability to pay ongoing regular dividends to our stockholders is subject to the discretion of our board of directors and may be limited by our holding company structure, existing and future debt agreements entered into by us or our subsidiaries and state law requirements.
•All of our domestic gaming facilities are leased and could experience risks associated with leased property, including risks relating to lease termination, lease extensions, charges and our relationship with the lessor, which could have a material adverse effect on our business, financial position or results of operations.
•Paul Salem, our Chairman, Daniel J. Taylor, one of our directors, and Corey Sanders, and John M. McManus, members of our senior management, may have actual or potential conflicts of interest because of their positions at MGP.
•Despite our ability to exercise control over the affairs of MGP as a result of our ownership of the single outstanding Class B share of MGP, MGP has adopted a policy under which certain transactions with us, including transactions involving consideration in excess of $25 million, must be approved in accordance with certain specified procedures, which could affect our ability to execute our operational and strategic objectives.
•Because a significant number of our major gaming resorts are concentrated on the Las Vegas Strip, we are subject to greater risks than a gaming company that is more geographically diversified.
•We extend credit to a large portion of our customers and we may not be able to collect gaming receivables.
•We may incur impairments to goodwill, indefinite-lived intangible assets, or long-lived assets which could negatively affect our future profits.
•Leisure and business travel, especially travel by air, are particularly susceptible to global geopolitical events, such as terrorist attacks, other acts of violence or acts of war or hostility or the outbreak of infectious diseases.
•Co-investing in properties or businesses, including our investment in BetMGM, decreases our ability to manage risk.
•Any of our future construction, development or expansion projects will be subject to significant development and construction risks, which could have a material adverse impact on related project timetables, costs and our ability to complete the projects.
•Our insurance coverage may not be adequate to cover all possible losses that our properties could suffer. In addition, our insurance costs may increase and we may not be able to obtain similar insurance coverage in the future.
•Any failure to protect our trademarks could have a negative impact on the value of our brand names and adversely affect our business.
•A significant portion of our labor force is covered by collective bargaining agreements.
•Our business is particularly sensitive to energy prices and a rise in energy prices could harm our operating results.
•We may seek to expand through investments in other businesses and properties or through alliances or acquisitions, and we may also seek to divest some of our properties and other assets, any of which may be unsuccessful.
•The failure to maintain the integrity of our computer systems and customer information could result in damage to our reputation and/or subject us to fines, payment of damages, lawsuits and restrictions on our use of data.
•We are subject to risks related to corporate social responsibility and reputation.
•We are subject to risks and costs related to climate change.

Risks Related to Legal and Regulatory Matters and Changes in Public Policy

•Our businesses are subject to extensive regulation and the cost of compliance or failure to comply with such regulations may adversely affect our business and results of operations.
•Any violation of the Foreign Corrupt Practices Act or any other similar anti-corruption laws could have a negative impact on us.
•If the jurisdictions in which we operate increase gaming taxes and fees, as well as other taxes and fees, our results could be adversely affected.
•The future recognition of our foreign tax credit deferred tax asset is uncertain, and the amount of valuation allowance we may apply against such deferred tax asset may change materially in future periods.
•We face risks related to pending claims that have been, or future claims that may be, brought against us.

Risks Related to Our Macau Operations

•We have agreed not to have any interest or involvement in gaming businesses in China, Macau, Hong Kong and Taiwan, other than through MGM China.
•The Macau government can terminate MGM Grand Paradise’s subconcession under certain circumstances without compensating MGM Grand Paradise, exercise its redemption right with respect to the subconcession, or refuse to grant MGM Grand Paradise an extension of the subconcession in 2022, or MGM Grand Paradise may be unsuccessful in obtaining a gaming concession when a new public tender is held by the Macau government, any of
16

which would have a material adverse effect on our business, financial condition, results of operations and cash flows.
•We are subject to risks associated with doing business outside of the United States.
•Conflicts of interest may arise because certain of our directors and officers are also directors of MGM China, the holding company for MGM Grand Paradise which owns and operates MGM Macau and MGM Cotai.

For a more complete discussion of the material risks facing our business, please see below.

Risks Related to Our Substantial Financial Commitments

Our substantial indebtedness and significant financial commitments, including the fixed component of our rent payments and guarantees we provide of the indebtedness of Bellagio BREIT Venture and MGP BREIT Venture could adversely affect our operations and financial results and impact our ability to satisfy our obligations. As of December 31, 2017,2021, we had approximately $13.0$12.9 billion of principal amount of indebtedness outstanding on a consolidated basis, including $373 million of borrowings outstanding and $1.1$4.3 billion of available borrowing capacity under our senior secured credit facility, and $2.3 billion and $2.1 billionoutstanding indebtedness of debt outstanding under the MGM China and the Operating Partnership credit facilities, respectively. In addition, the Operating Partnership has $1.9and $3.1 billion of senior notes outstanding.outstanding indebtedness of MGM China. Any increase in the interest rates applicable to our existing or future borrowings would increase the cost of our indebtedness and reduce the cash flow available to fund our other liquidity needs. We do not guarantee MGM China’s or the Operating Partnership’s obligations under their respective debt agreements and, to the extent MGM China or the Operating Partnership were to cease to produce cash flow sufficient to service their indebtedness, our ability to make additional investments into such entities is limited by the covenants in our existing senior secured credit facility.


In addition, our substantial indebtedness and significant financial commitments could have important negative consequences on us, including:


•increasing our exposure to general adverse economic and industry conditions;

•limiting our flexibility to plan for, or react to, changes in our business and industry;

•limiting our ability to borrow additional funds for working capital requirements, capital expenditures, debt service requirements, execution of our business strategy (including returning value to our shareholders) or other general operating requirements;

•making it more difficult for us to make payments on our indebtedness; or

•placing us at a competitive disadvantage compared to less-leveraged competitors.


We currently also provide shortfall guarantees of the $3.01 billion and $3.0 billion principal amount of indebtedness (and any interest accrued and unpaid thereon) of Bellagio BREIT Venture and MGP BREIT Venture, respectively. The terms of each guarantee provide that, after the lenders have exhausted certain remedies to collect on the obligations under the underlying indebtedness, we would then be responsible for any shortfall between the value of the collateral and the debt obligation, which amount may be material, and we may not have sufficient cash on hand to fund any such obligation to the extent it is triggered in the future. If we do not have sufficient cash on hand, we may need to raise capital, including incurring additional indebtedness, in order to satisfy our obligation. There can be no assurance that any financing will be available to us, or, if available, will be on terms that are satisfactory to us.

Moreover, our businesses are capital intensive. For our owned, leased and managed resorts to remain attractive and competitive, we must periodically invest significant capital to keep the properties well-maintained, modernized and refurbished (and, under the master lease we are requiredrefurbished. The leases for our operating properties have fixed rental payments (with annual escalators) and also require us to spend an aggregate amountapply a percentage of at least 1% of actual adjusted net revenues fromgenerated at the leased properties subject to the master lease on capital expenditures at those properties).properties. Such investments require an ongoing supply of cash and, to the extent that we cannot fund expenditures from cash generated by operations, funds must be borrowed or otherwise obtained. Similarly, development projects, including ourany potential future development projectof an integrated resort in Massachusetts,Japan, strategic initiatives, including positioning BetMGM as a leader in online sports betting and iGaming, and acquisitions could require significant capital commitments, the incurrence of additional debt, guarantees of third-party debt or the incurrence of contingent liabilities, any or all of which could have an adverse effect on our business, financial condition, and results of operations.

operations and cash flows.

Current and future economic, capital and credit market conditions could adversely affect our ability to service or refinance our substantial indebtedness and tosignificant financial commitments or make planned expenditures. Our ability to make payments on our substantial indebtedness and to refinance,other significant financial commitments, including the rent payments under our indebtednessleases, and to fund planned or committed capital expenditures and other investments depends on our ability to generate cash flow, in the future, receive distributions from our unconsolidated affiliates orand subsidiaries including CityCenter,(including MGM China and the Operating Partnership,Partnership), and borrow under our senior secured credit facility or incur new indebtedness. If regionalIn 2020 and national economic conditions deteriorate we could experience decreased2021, the COVID-19 pandemic resulted in significant deterioration to the global economy, and substantial declines in our revenues from operations and expected distributions from our operations attributableunconsolidated affiliates and subsidiaries. We expect that the recent

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emergence and global spread of COVID-19 variants may continue to decreases inimpact consumer spending levels in 2022 and couldpotentially thereafter, and if we fail to generate cash sufficient cash to fund our liquidity needs or fail to satisfy the financial and other restrictive covenants in our debt instruments. We cannot assure you that our business will generate sufficient cash flow from operations or continue to receive distributions from our unconsolidated affiliates or subsidiaries, including CityCenter, MGM China and the Operating Partnership. Welease instruments, we cannot assure you that future borrowings will be available to us under our senior secured credit facility in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. We cannot assure youneeds or that we will be able to access the capital markets in the future to borrow additional indebtednessdebt on terms that are favorable to us.

us, or at all.

We

In addition, we have a significant amount of indebtedness maturing in 2019,2022, and thereafter. Our ability to fund or timely refinance and replace our indebtedness in the future will depend upon the economic and credit market conditions discussed above. If we are unable to fund or refinance our indebtedness on a timely basis, we might be forced to seek alternate forms of financing, dispose of certain assets or minimize capital expenditures and other investments. There is no assurance that any of these alternatives would be available to us, if at all, on satisfactory terms, on terms that would not be disadvantageous to us, or on terms that would not require us to breach the terms and conditions of our existing or future debt agreements.


agreements or leases.

•

The agreements governing our senior secured credit facility and other senior indebtedness contain restrictions and limitations that could significantly affect our ability to operate our business, as well as significantly affect our liquidity, and therefore could adversely affect our results of operations. Covenants governing our senior secured credit facility and certain of our debt securities restrict, among other things, our ability to:


The agreements governing our senior credit facility and other senior indebtedness contain restrictions and limitations that could significantly affect our ability to operate our business, as well as significantly affect our liquidity, and therefore could adversely affect our results of operations. Covenants governing our senior secured credit facility and certain of our debt securities restrict, among other things, our ability to:


•pay dividends or distributions, repurchase or issue equity, prepay certain debt or make certain investments;

•incur additional debt;

•incur liens on assets;

•sell assets or consolidate with another company or sell all or substantially all of our assets;

•enter into transactions with affiliates;

•allow certain subsidiaries to transfer assets;assets or enter into certain agreements; and

•enter into sale and lease-back transactions.


Our ability to comply with these provisions may be affected by events beyond our control. The breach of any such covenants or obligations not otherwise waived or cured could result in a default under the applicable debt obligations and could trigger acceleration of those obligations, which in turn could trigger cross-defaults under other agreements governing our long-term indebtedness. In addition, our senior secured credit facility requires us to satisfy certain financial covenants, including a maximum total net leverage ratio, a maximum first lien net leverage ratio and a minimum interest coverage ratio. Any default under our senior secured credit facility or the indentures governing our other debt could adversely affect our growth, our financial condition, our results of operations and our ability to make payments on our debt.

debt and other financial commitments.


In addition, MGM Grand Paradise andeach of MGM China are co-borrowers under an amended and restated credit facility and the Operating Partnership has issued debt securities and is a borrower under its senior secured credit facility,facilities, all of which contain covenants that restrict the respective borrower’s ability to engage in certain transactions. In particular, these credit agreementstransactions, require MGM China and the Operating Partnershipthem to satisfy certain financial covenants and impose certain operating and financial restrictions on them and their respective subsidiaries (including, with respect to MGM China, MGM Grand Paradise).subsidiaries. These restrictions include, among other things, limitations on their ability to pay dividends or distributions to us, incur additional debt, make investments or engage in other businesses, merge or consolidate with other companies, or transfer or sell assets.


We are required to pay a significant portion of our cash flows as fixed and percentage rent, under the master lease, which could adversely affect our ability to fund our operations and growth initiatives, service our indebtedness and limit our ability to react to competitive and economic changes. For the second lease year commencing April 1, 2017, As of December 31, 2021 we wereare required to make annual rent payments of $662 million$1.6 billion, in the aggregate, under the master lease. triple-net lease agreements, which leases are also subject to annual escalators as described elsewhere in this Annual Report on Form 10-K. The leases also require us to spend a certain amount on capital expenditures at the leased properties. In October 2017, subsequentaddition, the leases governing the Bellagio, MGM Grand Las Vegas, Mandalay Bay, Aria (including Vdara) real estate assets require us to MGP’s acquisitioncomply with certain financial covenants which, if not met, will require us to deposit cash collateral or issue letters of MGM National Harbor’s real property, annualcredit for the benefit of the applicable landlord equal to 1 year of rent payments under the masterMGM Grand Las Vegas and Mandalay Bay lease increased to $757 million, prorated forand the remainderAria lease and 2 years of rent under the Bellagio lease. As a result of the second lease year. The master lease also provides for fixed annual escalators of 2% on the baseforegoing rent in the second through sixth years and the possibility for additional 2% increases thereafter subject to the tenant meeting an adjusted net revenue to rent ratio, as well as potential increases in percentage rent in year six and every five years thereafter based on a percentage of average actual annual net revenue during the preceding five year period. As a result,capital expenditure obligations, our ability to fund our own operations, raise capital, make acquisitions, make investments, service our debt and otherwise respond to competitive and economic changes may be adversely affected. For example, our obligations under the master leaseleases may:


•make it more difficult for us to satisfy our obligations with respect to our indebtedness and to obtain additional indebtedness;

•increase our vulnerability to general adverse economic and industry conditions or a downturn in our business;

•require us to dedicate a substantial portion of our cash flow from operations to making rent payments, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, development projects, pay dividends, repurchase shares and other general corporate purposes;

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•limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

•restrict our ability to make acquisitions, divestitures and engage in other significant transactions; and

•cause us to lose our rights with respect to all of the propertiesapplicable leased under the master leaseproperties if we fail to pay rent or other amounts or otherwise default on the master lease, given that all of the properties we lease from MGP under the master lease are effectively cross-collateralized as a result of the master lease being a single unitary lease.

leases.

Any of the above factors could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Risks Related to Our Announced Transactions

The VICI Transaction, The Cosmopolitan transaction and The Mirage transaction each remain subject to the satisfaction of certain closing conditions, including the receipt of certain regulatory approvals, and any anticipated benefits from such transactions may take longer to realize than expected or may not be realized at all. Each of the VICI Transaction, The Cosmopolitan transaction and The Mirage transaction is subject to certain closing conditions, which may not be satisfied within the anticipated timeframe or at all. For example, completion of the transactions remains subject to the receipt of certain regulatory approvals. There can be no assurance that any required regulatory approvals will be obtained, and the regulatory authorities from which approvals are required may impose conditions on the consummation of the transaction or require changes to the terms of the transaction or agreements to be entered into in connection with the transaction. Such conditions or changes and the process of obtaining regulatory approvals could have the effect of delaying or impeding the completion of the transactions, which might reduce the anticipated benefits to us of the transaction or have an adverse effect on our business, financial condition and results of operations.

The completion of the VICI Transaction is also subject to the satisfaction of additional closing conditions, including, among others, (i) receipt of approval of VICI’s shareholders (which was obtained on October 29, 2021), (ii) the absence of any restraining order, injunction or other judgment, order or decree from any applicable governmental authority prohibiting the consummation of the transaction, (iii) the effectiveness of the registration statement for VICI’s shares to be issued in the VICI Transaction and the authorization for listing of those shares on the New York Stock Exchange, (iv) the absence of a material adverse effect on the parties to the master transaction agreement, (v) the accuracy of each party’s representations and warranties in the master transaction agreement, subject to customary materiality standards, and (vi) compliance of each party with its respective covenants under the master transaction agreement. No assurance can be given that these or any other required conditions to closing will be satisfied. If the conditions precedent to the VICI Transaction are not satisfied, the VICI Transaction will not be completed unless such conditions are validly waived. Such conditions may jeopardize or delay the completion of the transaction or may reduce the anticipated benefits of the transaction.


If any of the transactions are not completed, or are not completed on a timely basis, our business may be adversely affected and, without realizing any of the benefits of having completed such transactions, we may be subject to additional risks, costs and expenses, including, but not limited to, the following:

•we will be required to pay our costs relating to such transactions, such as legal, accounting, financial advisory and printing fees, whether or not the transactions are completed;
•the diversion of time and resources committed by our management to matters relating to the transactions could otherwise have been devoted to pursuing other beneficial opportunities;
•we may be subject to negative publicity or be negatively perceived by the investment or business communities as a result of the failure to consummate any or all of the transactions;
•the price of our shares may decline to the extent that the current market price of our shares reflects a higher price than it otherwise would have based on the assumption that any or all of the transactions will be consummated;
•we would have incurred significant expenses relating to such transactions that we may be unable to recover, including termination fees if applicable; and
•we may be subject to litigation related to the failure to consummate the transactions or to perform our obligations under the respective transaction agreements.

In addition, we entered into the transactions as part of our current growth strategy. Even if the transactions are completed as currently anticipated, there can be no assurances that any anticipated benefits from the transactions will be realized as expected or that such benefits will be achieved within the anticipated time frame or at all. Failure to achieve the anticipated benefits of the transactions could adversely affect our results of operations or cash flows, cause dilution to our earnings per share, decrease or delay any accretive effect of such transactions and negatively impact the price of our common stock.

The potential litigation instituted against us, our transaction counterparties, or our respective directors challenging the proposed VICI Transaction may prevent such transaction from becoming effective within the expected timeframe or at all. Potential litigation related to the VICI Transaction may result in injunctive or other relief prohibiting, delaying or otherwise adversely affecting the parties’ ability to complete the VICI Transaction. One of the conditions to the
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VICI Transaction under the master transaction agreement is that no temporary restraining order, preliminary or permanent injunction or other judgment, order or decree issued by any governmental authority of competent jurisdiction prohibiting consummation of the VICI Transaction or any other transactions contemplated by the master transaction agreement shall be in effect. Accordingly, any such injunctive or other relief may prevent the VICI Transaction from becoming effective within the expected timeframe or at all. In addition, defending against such claims may be expensive and divert management’s attention and resources, which could adversely affect our business and the businesses of the counterparties to such transactions.

Risks Related to Our Business, Industry, and Market Conditions

The global COVID-19 pandemic has continued to materially impact our Business

business, financial results and liquidity, and such impact could worsen and last for an unknown period of time.As of the date of this annual report, there continues to be uncertainty around the COVID-19 pandemic, its duration, and its impact on U.S. and global economic activity and consumer behavior. The omicron variant of COVID-19, which appears to be the most transmissible and contagious variant to date, has caused an increase in COVID-19 cases globally. The impact of the omicron variant, or of any other variants that may emerge, cannot be predicted at this time, and could depend on numerous factors, including the availability of vaccines in different parts of the world, vaccination rates among the population, the effectiveness of COVID-19 vaccines against the variants, and the response by governmental bodies to reinstate mandated business closures, orders to “shelter in place,” occupancy limitations, and travel and transportation restrictions. While restrictions have eased throughout 2021, new restrictions to combat the spread of the variants, such as restrictions and bans on travel or transportation, stay-at-home directives, limitations on the size of gatherings, closures of work facilities, schools, public buildings and businesses, cancellation of events, including sporting events, concerts, conferences and meetings, and quarantines and lock-downs may be put into place in the future. In addition, the spread of new variants, including omicron, has had a material impact on domestic and international travel, which has resulted in reduced demand for hotel rooms, convention space and other casino resorts amenities.
In Macau, while all of our properties were open during 2021, several travel and entry restrictions were in place in Macau, Hong Kong and mainland China (including the temporary suspension of ferry services between Hong Kong and Macau, the nucleic acid test result certificate and mandatory quarantine requirements for returning residents, for visitors from Hong Kong, Taiwan, and certain regions in mainland China, and bans on entry on other visitors) which significantly impacted visitation to MGM Macau and MGM Cotai. In addition, from time to time during 2021 local COVID-19 cases were identified in Macau. Upon such occurrences, a state of immediate prevention was declared and mass mandatory nucleic acid testing was imposed in Macau, the validity period of negative test results for re-entry into mainland China was shortened and quarantine requirements were imposed, certain events were cancelled or suspended, and in some instances certain entertainment and leisure facilities were closed throughout Macau. Although gaming and hotel operations have remained open during these states of immediate prevention, such measures have had a negative effect on MGM Grand Paradise's operations and it is uncertain whether further closures, including the closure of MGM Grand Paradise's properties, or travel restrictions to Macau will be implemented if additional local COVID-19 cases are identified.

The extent to which the COVID-19 pandemic and new variants continue to impact our business, results of operations, and financial results, including the duration and magnitude of such effects, will depend on numerous evolving factors that we may not be able to accurately predict or assess, including, but not limited to: the duration and scope of the pandemic (and whether there is a, or multiple, further resurgences in the future); the efficacy of the vaccine against existing and new variants of the COVID-19 virus; the adoption rate of vaccines and the ability to effectively and efficiently distribute vaccines domestically and internationally to allow travel to resume to pre-pandemic levels; the negative impact the pandemic has on global and regional economies and economic activity, including the duration and magnitude of its impact on unemployment rates and consumer discretionary spending; its short and longer-term impact on the demand for travel, transient and group business, and levels of consumer confidence even after travel advisories and restrictions are lifted; our and our business partners' ability to successfully navigate the impacts of the pandemic; actions governments, businesses and individuals take in response to the pandemic (including the rise of variant strains of the virus), such as limiting or banning travel and limiting or banning leisure, casino and entertainment (including sporting events) activities, including the complete or partial closures of our properties; and how quickly economies, travel activity, and demand for gaming, entertainment and leisure activities recovers after the pandemic subsides. We may also face unforeseen liability or be subject to additional obligations as a result of the COVID-19 pandemic, including as a result of claims alleging exposure to COVID-19 in connection with our operations or facilities or to the extent we are subject to a governmental enforcement action as a result of health and safety compliance. The impact of the COVID-19 pandemic may also have the effect of exacerbating many of the other risks described in this section or in any other filings with the SEC. As a result of the foregoing, we cannot predict the ultimate scope, duration and impact the COVID-19 pandemic will have on our results of operations, but it may continue to have a material impact on our business, financial condition, liquidity, results of operations (including revenues and profitability) and stock price.

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We face significant competition with respect to destination travel locations generally and with respect to our peers in the industries in which we compete, including increased competition through online sports betting and iGaming, and failure to compete effectively could materially adversely affect our business, financial condition, results of operations and cash flowflows. The hotel, resort, entertainment, and casinogaming industries are highly competitive. We do not believe that our competition is limited to a particular geographic area, and hotel, resort, entertainment, and gaming operations in other states or countries, as well as the increased availability of online sports betting and iGaming, could attract our customers. To the extent that new casinos enter our markets or hotel room capacity is expanded by others in major destination locations, competition will increase. Major competitors, including potential new entrants, may also expand their hotel room capacity, expand their range of amenities, improve their level of service, or construct new resorts in Las Vegas, Macau or in the domestic regional markets in which we operate, all of which could attract our customers. Also, the growth of retail gaming in areas outside Las Vegas including California, has increased the competition faced by our operations in Las Vegas and elsewhere.

For instance, local referendums were recently passed to allow retail gaming in Virginia and Nebraska, with active lobbying occurring in additional states. While we believe our principal competitors are major gaming and hospitality resorts with well-established and recognized brands, we also compete against smaller hotel offerings and peer-to-peer inventory sources, which allow travelers to book short-term rentals of homes and apartments from owners. We expect that we will continue to face increased competition from new channels of distribution, innovations in consumer-facing technology platforms and other transformations in the travel industry that could impact our ability to attract and retain customers and related business.

We have also seen significant expansion across the United States in legalized forms of iGaming and online sports betting and expect additional jurisdictions will likely legalize iGaming and online sports betting in the future. We participate in the domestic iGaming and online sports betting market through our venture, BetMGM, which faces significant competition from other industry participants as well as the broader gaming and entertainment industries. If BetMGM is unable to sustain or grow interest in its offerings it may not be able to gain the scale necessary to successfully compete in the growing market and, as a result, we may not receive the anticipated benefits from our investment. In addition, the expansion of iGaming, online sports betting, and other types of gaming may further compete with our land-based operations by reducing customer visitation and spend at our properties.

In addition, competition could increase if changes in gaming restrictions in the United States and elsewhere result inare enacted, including the addition of new gaming establishments located closer to our customers than our casinos. For example, while our Macau operations compete to some extent with casinos located elsewhere in or near Asia, certain countriesareas in the region have legalized casino gaming (including Japan) and others (such as Taiwan and Thailand) may legalize casino gaming (or online gaming)iGaming) in the future (including, for example, a recent proposal by China to allow gambling on Hainan Island).future. Furthermore, currently MGM Grand Paradise holds one of only six gaming concessions authorized by the Macau government to operate casinos in Macau. If the Macau government were to allow additional competitors to operate in Macau through the grant of additional concessions or if current concessionaires and subconcessionaires open additional facilities, we would face increased competition.

Similarly, as a result of Macau’s Gaming Inspection and Co-ordination Bureau increasing scrutiny and restrictions imposed on gaming promoters, we along with certain other casino operators in Macau, suspended our primary gaming promoters, which has led to substantial declines in revenues from gaming promoters. As a result, we expect competition for the mass market segment amongst Macau operators will grow and if we are unable to maintain and further develop our mass market business and replace revenue previously obtained through use of gaming promoters, our business, financial condition, results of operations and cash flows could be adversely affected.


Most jurisdictions where casino gaming is currently permitted place numerical and/or geographical limitations on the issuance of new gaming licenses. Although a number of jurisdictions in the United States and foreign countries are considering legalizing or expanding casino gaming, in some cases new gaming operations may be restricted to specific locations and we expect that there will be intense competition for any attractive new opportunities (which may include acquisitions of existing properties) that do arise. Furthermore, certain jurisdictions, including Nevada and New Jersey, have also legalized forms of online gaming and other jurisdictions, including Illinois, have legalized video gaming terminals. The expansion of online gaming and other types of gaming in these and other jurisdictions may further compete with our operations by reducing customer visitation and spend in our casino resorts.


In addition to competition with other hotels, resorts and casinos, we compete with destination travel locations outside of the markets in which we operate. Our failure to compete successfully in our various markets and to continue to attract customers could adversely affect our business, financial condition, results of operations and cash flow.

flows.

Our businesses are subject to extensive regulation and the cost of compliance or failure to comply with such regulations may adversely affect our business and results of operations. Our ownership and operation of gaming facilities is subject to extensive regulation by the countries, states and provinces in which we operate. These laws, regulations and ordinances vary from jurisdiction to jurisdiction, but generally concern the responsibility, financial stability and character of the owners and managers of gaming operations as well as persons financially interested or involved in gaming operations. As such, our gaming regulators can require us to disassociate ourselves from suppliers or business partners found unsuitable by the regulators or, alternatively, cease operations in that jurisdiction. In addition, unsuitable activity on our part or on the part of our domestic or foreign unconsolidated affiliates or subsidiaries in any jurisdiction could have a negative effect on our ability to continue operating in other jurisdictions. The regulatory environment in any particular jurisdiction may change in the future and any such change could have a material adverse effect on our results of operations. In addition, we are subject to various gaming taxes, which are subject to possible increase at any time by various federal, state, local and foreign legislatures and officials. Increases in gaming taxation could also adversely affect our results. For a summary of gaming and other regulations that affect our business, see “Regulation and Licensing” and Exhibit 99.2 to this Annual Report on Form 10-K.

Further, our directors, officers, key employees and investors in our properties must meet approval standards of certain state and foreign regulatory authorities. If state regulatory authorities were to find such a person or investor unsuitable, we would be required to sever our relationship with that person or the investor may be required to dispose of his, her or its interest in the property. State regulatory agencies may conduct investigations into the conduct or associations of our directors, officers, key employees or investors to ensure compliance with applicable standards. Certain public and private issuances of securities and other transactions also require the approval of certain regulatory authorities.


In Macau, current laws and regulations concerning gaming and gaming concessions are, for the most part, fairly recent and there is little precedent on the interpretation of these laws and regulations. These laws and regulations are complex, and a court or administrative or regulatory body may in the future render an interpretation of these laws and regulations, or issue new or modified regulations, that differ from MGM China’s interpretation, which could have a material adverse effect on its business, financial condition and results of operations. In addition, MGM China’s activities in Macau are subject to administrative review and approval by various government agencies. We cannot assure you that MGM China will be able to obtain all necessary approvals, and any such failure to do so may materially affect its long-term business strategy and operations. Macau laws permit redress to the courts with respect to administrative actions; however, to date such redress is largely untested in relation to gaming issues.

In addition to gaming regulations, we are also subject to various federal, state, local and foreign laws and regulations affecting businesses in general. These laws and regulations include, but are not limited to, restrictions and conditions concerning alcoholic beverages, environmental matters, smoking, employees, currency transactions, taxation, zoning and building codes, and marketing and advertising. For instance, we are subject to certain federal, state and local environmental laws, regulations and ordinances, including the Clean Air Act, the Clean Water Act, the Resource Conservation Recovery Act, the Comprehensive Environmental Response, Compensation and Liability Act and the Oil Pollution Act of 1990. Under various federal, state and local environmental laws and regulations, an owner or operator of real property may be held liable for the costs of removal or remediation of certain hazardous or toxic substances or wastes located on its property, regardless of whether or not the present owner or operator knows of, or is responsible for, the presence of such substances or wastes. Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. For example, Illinois has enacted a ban on smoking in nearly all public places, including bars, restaurants, work places, schools and casinos. Similarly, in October 2014, casinos in Macau, including MGM China, implemented a smoking ban which prohibits smoking on all mass market gaming floors and, in 2015, the Macau Health Bureau announced that they will promote the submission of a bill proposing a full smoking ban in casinos, including in VIP rooms. The likelihood or outcome of similar legislation in other jurisdictions and referendums in the future cannot be predicted, though any smoking ban would be expected to negatively impact our financial performance.

We also deal with significant amounts of cash in our operations and are subject to recordkeeping and reporting obligations as required by various anti-money laundering laws and regulations. For instance, we are subject to regulation under the Currency and Foreign Transactions Reporting Act of 1970, commonly known as the “Bank Secrecy Act,” which, among other things, requires us to report to the Internal Revenue Service (“IRS”) any currency transactions in excess of $10,000 that occur within a 24-hour gaming day, including identification of the individual(s) involved in the currency transaction. We are also required to report certain suspicious activity where we know, suspect or have reason to suspect transactions, among other things, involve funds from illegal activity or are intended to evade federal regulations or avoid reporting requirements or have no business or lawful purpose. In addition, under the Bank Secrecy Act we are subject to various other rules and regulations involving reporting, recordkeeping and retention. Our compliance with the Bank Secrecy Act is subject to periodic examinations by the IRS. Any such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Any violations of the anti-money laundering laws, including the Bank Secrecy Act, or regulations by any of our properties could have an adverse effect on our financial condition, results of operations or cash flows.

Our business is affected by economic and market conditions in the jurisdictions in which we operate and in the locations in which our customers reside. Our business is particularly sensitive to reductions in discretionary consumer spending and corporate spending on conventions, trade shows and business development. EconomicAdverse macroeconomic conditions, including inflation, economic contraction, economic uncertainty or the perception by our customers of weak or weakening economic conditions may cause a decline in demand for hotels, casino resorts, trade shows and conventions, and for the type of luxury amenities we offer. In addition, changes in discretionary consumer spending or consumer preferences could be driven by factors such as the increased cost of travel, an unstable job market, perceived or actual disposable consumer income and wealth, outbreaks of contagious diseases or fears of war and acts of terrorism or other

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acts of violence. Consumer preferences also evolve over time due to a variety of factors, including demographic changes, which, for instance, have resulted in recent growth in consumer demand for non-gaming offerings. Our success depends in part on our ability to anticipate the preferences of consumers and timely react to these trends, and any failure to do so may negatively impact our results of operations. In particular, Aria, Bellagio and MGM Grand Las Vegas in particular may be affected by economic conditions in the Far East, and all of our Nevada resorts are affected by economic conditions in the United States, and California in particular. A recession, economic slowdown or any other significant economic condition, including inflationary pressures, affecting consumers, corporations, or corporationsthe supply chain, generally is likely to cause a reduction in visitation to our resorts, which would adversely affect our operating results. For example,In addition, due to the prior recessionCOVID-19 pandemic, our business has also been impacted by labor shortages and downturn in consumerglobal supply chain disruptions. If we are unable to hire and corporate spending had a negative impact onretain sufficient employees to operate our properties or procure necessary supplies, our business, results of operations.

operations and reputation could be negatively impacted.


In addition, since we expect a significant number of customers to come to MGM Macau and MGM Cotai (and, to a lesser extent, our domestic properties) from mainland China, general economic, regulatory, geopolitical and market conditions in China could impact our financial prospects. Any slowdown in economic growth or changes to China’s current restrictions on travel and currency conversion or movements, including continued market impacts from the COVID-19 outbreak and market impacts resulting from China’s recent anti-corruption campaign and related tightening of liquidity provided by non-bank lending entities and cross-border currency monitoring (including increased restrictions on Union Pay withdrawals and other ATM limits on the withdrawal of patacas imposed by the government), could disrupt the number of visitors from mainland China to MGM Macau and/or the amounts they are willing to spend in the casino. For example, from 2008 through 2010, China readjusted its visa policy toward Macau and limited the number of visits that some mainland Chinese citizens may make to Macau in a given time period. In addition, effective October 2013, China banned “zero‑fare” tour groups involving no or low up-front payments and compulsory shopping, which were popular among visitors to Macau from mainland China, and in December 2014 the Chinese government tightened the enforcement of visa transit rules for those seeking to enter Macau at the Gongbei border (including requirements to present an airplane ticket to a destination country, a visa issued by such destination country and a valid Chinese passport). Most recently, in July 2017, the Chinese government, along with Macau authorities, implemented new facial recognition technology on ATM machines in Macau to strictly enforce the “know your customer”"know your customer" regulations for mainland Chinese bank cardholders.cardholders), could disrupt the number of visitors from mainland China and/or the amounts they are willing to spend at our properties. It is unclear whether these and other measures will continue to be in effect, become more restrictive, or be readopted in the future. These developments have had, and any future policy developments that may be implemented may have, the effect of reducing the number of visitors to Macau from mainland China, which could adversely impact tourism and the gaming industry in Macau.

Furthermore, our operations in Macau may be impacted by competition for limited labor resources. Our success in Macau will be impacted byresources and our ability to retain and hire employees. We compete with a large number of casino resorts for a limited number of employees and we anticipate that such competition will grow in light of the opening of new developments in Macau. While we seek employees from other countriesoutside of Macau to adequately staff our resorts, certain Macau government policies limit our ability to import labor in certain job classifications (for instance, the Macau government requires that we only hire Macau residents as dealers in our casinos) and any future government policies that freeze or cancel our ability to import labor could cause labor costs to increase.increase (including limitations on our ability to import labor as a result of temporary travel restrictions adopted as part of the COVID-19 mitigation efforts). Finally, because additional casino projects have commenced operations and other projects are under construction, and are to be developed in the future, existing transportation infrastructure may need to be expanded to accommodate increased visitation to Macau. If transportation facilities to and from Macau are inadequate to meet the demands of an increased volume of gaming customers visiting Macau, the desirability of Macau as a gaming destination, as well as the results of operations at our developmentdevelopments in Cotai, Macau, could be negatively impacted.


We may not realize all of the anticipated benefits of our cost savings initiatives, including those associated with our MGM 2020 Plan. As part of our MGM 2020 Plan, we undertook several initiatives to reduce costs and further position us for growth by the end of 2020. In addition, as a result of the COVID-19 pandemic, we implemented several additional cost savings initiatives in 2020 to improve our operating model. However, we cannot be sure that we will be able to sustain our continuous improvement efforts. In 2015,successfully implement these cost savings initiatives in the time frames contemplated or at all, that we commenced an initiative for sustained growth and margin enhancement, focused on improving our business processeswill ultimately be able to optimize scale for greater efficiency and lowerrealize the expected benefits of these or any other cost savings initiatives, or that any new additional costs throughout our business.Whileor increases in existing expenses will not offset any cost savings. If we believe these initiatives will continue to result in Adjusted EBITDA benefit, our optimization efforts may fail to achieve expectedthe anticipated benefits of any current or future cost savings initiatives, our profitability and results or we may notof operations could be able to sustain our historic efforts to produce continuous improvements. In addition, while we expect to continue to explore additional opportunities to drive further improvement to our business processes, we may not be able to achieve the historic Adjusted EBITDA benefits at the same rate (or at all) and we may not be able to institutionalize the continuous improvement business practices that developed in connection with implementing the Profit Growth Plan.

negatively impacted.

Our ability to pay ongoing regular dividends to our stockholders is subject to the discretion of our board of directors and may be limited by our holding company structure, existing and future debt agreements entered into by us or our subsidiaries and state law requirements.We During the COVID-19 pandemic we significantly reduced our historic dividend rate. Although we intend to pay ongoing regular quarterly cash dividends on our common stock. However,stock; our board of directors may, in its sole discretion, change the amount or frequency of dividends or discontinue the payment of dividends entirely. In addition, our ability to pay dividends is restricted by certain covenants in our credit agreement, and because we are a holding company with no material direct operations, we are dependent on receiving cash from our operating subsidiaries to generate the funds from operations necessary to pay dividends on our common stock. We expect ourOur subsidiaries will continueability to generate significantthe cash flow necessary to maintain quarterly dividend payments on our common stock; however, their ability to generate funds will bestock is subject to their operating results, cash requirements and financial condition,condition. In addition, our subsidiaries’ ability to make distributions to us is subject to any applicable provisions of state law that may limit the amount of funds available to us, and compliance with covenants and financial ratios related to existing or future agreements governing any indebtedness at such subsidiaries and any limitations in other agreements such subsidiaries may have with third parties. In addition, each of the companies in our

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corporate chain must manage its assets, liabilities and working capital in order to meet all of their respective cash obligations. As a consequence of these various limitations and restrictions, future dividend payments may be further reduced or eliminated.eliminated in their entirety. Any change in the level of our dividends or the suspension of the payment thereof could adversely affect the market price of our common stock.


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A significant numberAll of our domestic gaming facilities are leased and could experience risks associated with leased property, including risks relating to lease termination, lease extensions, charges and our relationship with the lessor, which could have a material adverse effect on our business, financial position or results of operations. We lease eleven of our


destination resorts and The Park from a subsidiary of MGP pursuant to the master lease. The master lease has a term of ten years with up to four additional five year extensions, subject to satisfaction of certain conditions. The master lease is commonly known as a triple-net lease. Accordingly, in addition to rent, we are required to pay the following, among other things: (1) all facility maintenance, (2) all insurance required in connection with the leased properties and the business conducted on the leased properties, (3) taxes levied on or with respect to the leased properties (other than taxes on the income of the lessor), (4) all capital expenditures, and (5) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties. We are responsible for paying these expenses notwithstanding the fact that many of the benefits received in exchange for such costs shall accrue in part to MGP as owner of the associated facilities. In addition, if some of our leased facilities should prove to be unprofitable or experience other issues that would warrant ceasing operations, or if we should otherwise decide to exit a particular property, we would remain obligated for lease payments and other obligations under the master lease even if we decided to cease operations at those locations unless we are able to transfer the rights with respect to a particular property in accordance with the requirements of the master lease. Our ability to transfer our obligations under the master lease to a third-party with respect to individual properties, should we decide to withdraw from a particular location, is limited to non-Las Vegas properties and no more than two Las Vegas gaming properties, and is subject to identifying a willing third-party who meets the requirements for a transferee set forth in the master lease. We may be unable to find an appropriate transferee willing to assume the obligations under the master lease with respect to any such property. In addition, we could incur special charges relating to the closing of such facilities including sublease termination costs, impairment charges and other special charges that would reduce our net income and could have a material adverse effect on our business, financial condition and results of operations. Furthermore, our obligation to pay rent as well as the other costs described above is absolute in virtually all circumstances, regardless of the performance of the properties and other circumstances that might abate rent in leases that now place these risks on the tenant, such as certain events of casualty and condemnation.

Any financial, operational, regulatory or other potential challenges that may arise with respect to MGP, as our sole lessor for a significant portion of our properties, may adversely impair our operations. We lease a substantial number of the properties that we operate and manage, which represents a significant portion of our operations, from MGP under the master lease. If MGP has financial, operational, regulatory or other challenges, there can be no assurance that MGP will be able to comply with its obligations under the master lease or its other agreements with us. Failure on the part of MGP to fulfill its commitments could have a material adverse effect on our business, financial condition andposition or results of operations.

All of our domestic properties are subject to triple-net leases that, in addition to rent, require us to pay: (1) all facility maintenance, (2) all insurance required in connection with the leased properties and the business conducted on the leased properties, (3) taxes levied on or with respect to the leased properties (other than taxes on the income of the lessor), (4) all capital expenditures, and (5) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties. We are responsible for paying these expenses notwithstanding the fact that many of the benefits received in exchange for such costs shall accrue in part to the landlords as the owners of the associated facilities. Furthermore, our obligation to pay rent as well as the other costs described above is absolute in virtually all circumstances, regardless of the performance of the properties and other circumstances that might abate rent in leases that now place these risks on the tenant, such as certain events of casualty and condemnation. Finally, our leases limit our ability to cease operations at our properties, subject to certain limited exceptions.

James J. Murren,Paul Salem, our Chairman, Daniel J. Taylor, one of our directors, and William J. Hornbuckle, Elisa C. Gois,Corey Sanders, and John M. McManus, members of our senior management, may have actual or potential conflicts of interest because of their positions at MGP. James J. MurrenPaul Salem serves as our Chairman and as the Chairman of MGP. In addition, Daniel J. Taylor, one of our directors, is also a director of MGP, and William J. Hornbuckle, Elisa C. Gois,Corey Sanders and John M. McManus, members of our senior management, are also directors of MGP. While we have procedures in place to address such situations and the organizational documents with respect to MGP contain provisions that reduce or eliminate duties (including fiduciary duties) to any MGP shareholder to the fullest extent permitted by law, these overlapping positions could nonetheless create, or appear to create, potential conflicts of interest when our or MGP'sMGP’s management and directors pursue the same corporate opportunities, such as potential acquisition targets, or face decisions that could have different implications for us and MGP. Further, potential conflicts of interest could arise in connection with the resolution of any dispute between us and MGP (or its subsidiaries) regarding the terms of the agreements governing the separation and the relationship, between us and MGP, such as under the master lease. Potential conflicts of interest could also arise if we and MGP enter into any commercial or other adverse arrangements with each other in the future.


Despite our ability to exercise control over the affairs of MGP as a result of our ownership of the single outstanding Class B share of MGP, MGP has adopted a policy under which certain transactions with us, including transactions involving consideration in excess of $25 million, must be approved in accordance with certain specified procedures, which could affect our ability to execute our operational and strategic objectives.We own the single outstanding Class B share of MGP. The Class B Share is a non-economic interest in MGP which does not provide its holder any rights to profits or losses or any rights to receive distributions from operations of MGP or upon liquidation or winding up of MGP, and which represents a majority of the voting power of MGP’s shares so long as the holder of the Class B share and its controlled affiliates’ (excluding MGP) aggregate beneficial ownership of the combined economic interests in MGP and the Operating Partnership does not fall below 30%. We, therefore, have the ability to exercise significant control over MGP’s affairs, including control over the outcome of all matters submitted to MGP’s shareholders for approval.

MGP’s operating agreement, however, provides that whenever a potential conflict of interest exists or arises between us or any of our affiliates (other than MGP and its subsidiaries), on the one hand, and MGP or any of its subsidiaries, on the other hand, any resolution or course of action by MGP’s board of directors in respect of such conflict of interest shall be conclusively deemed to be fair and reasonable to MGP if it is (i) approved by a majority of a conflicts committee which


consists solely of “independent” directors (which MGP refers to as “Special Approval”) (such independence determined in accordance with the NYSE’s listing standards, the standards established by the Exchange Act to serve on an audit committee of a board of directors and certain additional independence requirements in our operating agreement), (ii) determined by MGP’s board of directors to be fair and reasonable to MGP or (iii) approved by the affirmative vote of the holders of at least a majority of the voting power of MGP’s outstanding voting shares (excluding voting shares owned by us and our affiliates). Furthermore, MGP’s operating agreement provides that any transaction with a value, individually or in the aggregate, over $25 million between us or any of our affiliates (other than MGP and its subsidiaries), on the one hand, and MGP or any of its subsidiaries, on the other hand (any such transaction (other than the exercise of rights by us or any of our affiliates (other than MGP and its subsidiaries) under any of the material agreements entered into on the closing day of MGP’s formation transactions), a “Threshold Transaction”), shall be permitted only if (i) Special Approval is obtained or (ii) such transaction is approved by the affirmative vote of the holders of at least a majority of the voting power of MGP’s outstanding voting shares (excluding voting shares owned by us and our affiliates).

As a result, certain transactions, including any Threshold Transactions that we may want to pursue with MGP and that could have significant benefit to us may require Special Approval. There can be no assurance that the required approval will be

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obtained with respect to these transactions either from a conflicts committee comprised of independent MGP directors or the affirmative vote of a majority of the shares not held by us and our affiliates. The failure to obtain such requisite consent could materially affect our ability and the cost to execute our operational and strategic objectives.


We have agreed not to have any interest or involvement in gaming businesses in China, Macau, Hong Kong and Taiwan, other than through MGM China. In connection with the initial public offering of MGM China, the holding company that indirectly owns and operates MGM Macau, we entered into a Deed of Non-Compete Undertakings with MGM China and Ms. Ho, Pansy Catilina Chiu King (“Ms. Ho”) pursuant to which we are restricted from having any interest or involvement in gaming businesses in the People’s Republic of China, Macau, Hong Kong and Taiwan, other than through MGM China. While gaming is currently prohibited in China, Hong Kong and Taiwan, if it is legalized in the future our ability to compete in these locations could be limited until the earliest of (i) March 31, 2020, (ii) the date MGM China’s ordinary shares cease to be listed on The Stock Exchange of Hong Kong Limited or (iii) the date when our ownership of MGM China shares is less than 20% of the then-issued share capital of MGM China.

The Macau government can terminate MGM Grand Paradise’s subconcession under certain circumstances without compensating MGM Grand Paradise, exercise its redemption right with respect to the subconcession, or refuse to grant MGM Grand Paradise an extension of the subconcession in 2020, any of which would have a material adverse effect on our business, financial condition, results of operations and cash flows. The Macau government has the right to unilaterally terminate the subconcession in the event of fundamental non-compliance by MGM Grand Paradise with applicable Macau laws or MGM Grand Paradise’s basic obligations under the subconcession contract. MGM Grand Paradise has the opportunity to remedy any such non-compliance with its fundamental obligations under the subconcession contract within a period to be stipulated by the Macau government. Upon such termination, all of MGM Grand Paradise’s casino area premises and gaming-related equipment would be transferred automatically to the Macau government without compensation to MGM Grand Paradise, and we would cease to generate any revenues from these operations. We cannot assure you that MGM Grand Paradise will perform all of its obligations under the subconcession contract in a way that satisfies the requirements of the Macau government.

Furthermore, under the subconcession contract, MGM Grand Paradise is obligated to comply with any laws and regulations that the Macau government might promulgate in the future. We cannot assure you that MGM Grand Paradise will be able to comply with these laws and regulations or that these laws and regulations would not adversely affect our ability to construct or operate our Macau businesses. If any disagreement arises between MGM Grand Paradise and the Macau government regarding the interpretation of, or MGM Grand Paradise’s compliance with, a provision of the subconcession contract, MGM Grand Paradise will be relying on a consultation and negotiation process with the Macau government. During any consultation or negotiation, MGM Grand Paradise will be obligated to comply with the terms of the subconcession contract as interpreted by the Macau government. Currently, there is no precedent concerning how the Macau government will treat the termination of a concession or subconcession upon the occurrence of any of the circumstances mentioned above. The loss of the subconcession would require us to cease conducting gaming operations in Macau, which would have a material adverse effect on our business, financial condition, results of operations and cash flows.

In addition, the subconcession contract expires on March 31, 2020. Unless the subconcession is extended, or legislation with regard to reversion of casino premises is amended, all of MGM Grand Paradise’s casino premises and gaming-related equipment will automatically be transferred to the Macau government on that date without compensation to us, and we will cease to generate any revenues from such gaming operations. Beginning on April 20, 2017, the Macau government may redeem the subconcession contract by providing us at least one year’s prior notice. In the event the Macau government


exercises this redemption right, MGM Grand Paradise is entitled to fair compensation or indemnity. The amount of such compensation or indemnity will be determined based on the amount of gaming and non-gaming revenue generated by MGM Grand Paradise, excluding the convention and exhibition facilities, during the taxable year prior to the redemption, before deducting interest, depreciation and amortization, multiplied by the number of remaining years before expiration of the subconcession. We cannot assure you that MGM Grand Paradise will be able to renew or extend the subconcession contract on terms favorable to MGM Grand Paradise or at all. We also cannot assure you that if the subconcession is redeemed, the compensation paid to MGM Grand Paradise will be adequate to compensate for the loss of future revenues.

MGM Grand Paradise is dependent upon gaming promoters forBecause a significant portion of gaming revenues in Macau. Gaming promoters, who promote gaming and draw high-end customers to casinos, are responsible for a significant portion of MGM Grand Paradise’s gaming revenues in Macau. With the rise in gaming in Macau and the recent reduction in the number of licensed gaming promoters in Macau and in the number of VIP rooms operated by licensed gaming promoters, the competition for relationships with gaming promoters has increased. While MGM Grand Paradise is undertaking initiatives to strengthen relationships with gaming promoters, there can be no assurance that it will be able to maintain, or grow, relationships with gaming promoters. In addition, continued reductions in, and new regulations governing, the gaming promoter segment may result in the closure of additional VIP rooms in Macau, including VIP rooms at MGM Macau. If MGM Grand Paradise is unable to maintain or grow relationships with gaming promoters, or if gaming promoters are unable to develop or maintain relationships with our high-end customers (or if, as a result of recent market conditions in Macau, gaming promoters encounter difficulties attracting patrons to come to Macau or experience decreased liquidity limiting their ability to grant credit to patrons), MGM Grand Paradise’s ability to grow gaming revenues will be hampered. Furthermore, if existing VIP rooms at MGM Macau are closed there can be no assurance that MGM Grand Paradise will be able to locate acceptable gaming promoters to run such VIP rooms in the future in a timely manner, or at all.

In addition, the quality of gaming promoters is important to MGM Grand Paradise’s and our reputation and ability to continue to operate in compliance with gaming licenses. While MGM Grand Paradise strives for excellence in associations with gaming promoters, we cannot assure you that the gaming promoters with whom MGM Grand Paradise is or becomes associated will meet the high standards insisted upon. If a gaming promoter falls below MGM Grand Paradise’s standards, MGM Grand Paradise or we may suffer reputational harm or possibly sanctions from gaming regulators with authority over our operations.

We also grant credit lines to certain gaming promoters and any adverse change in the financial performance of those gaming promoters may impact the recoverability of these loans.

We are subject to taxation by various governments and agencies and the rate of taxation in the jurisdictions in which we operate could change in the future.We are subject to tax by various governments and agencies, both in the U.S. and in Macau. Changes in the rates of taxation, the amount of taxes we owe and the time when income is subject to taxation, the Macau income tax exemption or the imposition of foreign withholding taxes could increase our overall rate of taxation. Any of these changes could materially impact our business, financial condition, results of operations and cash flows.

The future recognition of our foreign tax credit deferred tax asset is uncertain, and the amount of valuation allowance we may apply against such deferred tax asset may change materially in future periods. We currently have significant deferred tax assets resulting from foreign tax credit carryforwards that are available to reduce potential taxable foreign-sourced income in future periods. We evaluate our foreign tax credit deferred tax asset for recoverability and record a valuation allowance to the extent that we determine it is not more likely than not such asset will be recovered. This evaluation is based on all available evidence, including assumptions concerning future U.S. operating profits and our initial interpretations of the U.S. Tax Cuts and Jobs Act (the “Tax Act”) in the absence of regulatory or other clarifying guidance. As a result, significant judgment is required in assessing the possible need for a valuation allowance and changes to our assumptions could result in a material change in the valuation allowance with a corresponding impact on the provision for income taxes in the period including such change.

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Extreme weather conditions or climate change may cause property damage or interrupt business, which could harm our business and results of operations. Certain of our casino properties are located in areas that may be subject to extreme weather conditions, including, but not limited to, hurricanes in the United States and severe typhoons in Macau. Such extreme weather conditions may interrupt our operations, damage our properties, and reduce the number of customers who visit our facilities in such areas. In addition, our operations could be adversely impacted by a drought or other cause of water shortage. A severe drought of extensive duration experienced in Las Vegas or in the other regions in which we operate could adversely affect our business and results of operations. Although we maintain both property and business interruption insurance coverage for certain extreme weather conditions, such coverage is subject to deductibles and limits on maximum benefits, including limitation on the coverage period for business interruption, and we cannot assure you that


we will be able to fully insure such losses or fully collect, if at all, on claims resulting from such extreme weather conditions. Furthermore, such extreme weather conditions may interrupt or impede access to our affected properties and may cause visits to our affected properties to decrease for an indefinite period, which would have a material adverse effect on our business, financial condition, results of operations and cash flows.

Because a majority of our major gaming resorts are concentrated on the Las Vegas Strip, we are subject to greater risks than a gaming company that is more geographically diversified. Given that a majoritysignificant number of our major resorts are concentrated on the Las Vegas Strip, our business may be significantly affected by risks common to the Las Vegas tourism industry. For example, the cost and availability of air services and the impact of any events that disrupt air travel to and from Las Vegas can adversely affect our business. We cannot control the number or frequency of flights to or from Las Vegas, but we rely on air traffic for a significant portion of our visitors. Reductions in flights by major airlines as a result of higher fuel prices or lower demand, as a result of limitations on travel imposed to address the COVID-19 pandemic or otherwise, can impact the number of visitors to our resorts. Additionally, there is one principal interstate highway between Las Vegas and Southern California, where a large number of our customers reside. Capacity constraints of that highway or any other traffic disruptions may also affect the number of customers who visit our facilities.


We extend credit to a large portion of our customers and we may not be able to collect gaming receivables. We conduct a portion of our gaming activities on a credit basis through the issuance of markers which are unsecured instruments. Table games players typically are issued more markers than slot players, and high-end players typically are issued more markers than patrons who tend to wager lower amounts. High-end gaming is more volatile than other forms of gaming, and variances in win-loss results attributable to high-end gaming may have a significant positive or negative impact on cash flow and earnings in a particular quarter. Furthermore, the loss or a reduction in the play of the most significant of these high-end customers could have an adverse effect on our business, financial condition, results of operations and cash flows. We issue markers to those customers whose level of play and financial resources warrant, in the opinion of management, an extension of credit. In addition, MGM Grand Paradise extends credit to certain gaming promoters and those promoters can extend credit to their customers. Uncollectible receivables from high-end customers and gaming promoters could have a significant impact on our results of operations.


While gaming debts evidenced by markers and judgments on gaming debts are enforceable under the current laws of Nevada, and Nevada judgments on gaming debts are enforceable in all states under the Full Faith and Credit Clause of the U.S. Constitution, other jurisdictions may determine that enforcement of gaming debts is against public policy. Although courts of some foreign nations will enforce gaming debts directly and the assets in the U.S. of foreign debtors may be reached to satisfy a judgment, judgments on gaming debts from United States courts are not binding on the courts of many foreign nations.


Furthermore, we expect that MGM MacauChina will be able to enforce its gaming debts only in a limited number of jurisdictions, including Macau. To the extent MGM MacauChina gaming customers and gaming promoters are from other jurisdictions, MGM MacauChina may not have access to a forum in which it will be able to collect all of its gaming receivables because, among other reasons, courts of many jurisdictions do not enforce gaming debts and MGM MacauChina may encounter forums that will refuse to enforce such debts. Moreover, under applicable law, MGM MacauChina remains obligated to pay taxes on uncollectible winnings from customers.


Even where gaming debts are enforceable, they may not be collectible. Our inability to collect gaming debts could have a significant negative impact on our operating results.


We may incur impairments to goodwill, indefinite-lived intangible assets, or long-lived assets which could negatively affect our future profits. We review our goodwill, intangible assets and long-lived assets on an annual basis and during interim reporting periods in accordance with the authoritative guidance. Significant negative trends, reduced estimates of future cash flows, disruptions to our business, slower growth rates or lack of growth have resulted in write-downs and impairment charges in the past and, if one or more of such events occurs in the future, additional impairment charges or write-downs may be required in future periods. For instance, in 2015, we recorded a non-cash impairment charge of $1.5 billion to reduce the historical carrying value of goodwill related to the MGM China reporting unit. If we are required to record additional impairment charges or write-downs, this could have a material adverse impact on our consolidated results of operations.


Leisure and business travel, especially travel by air, are particularly susceptible to global geopolitical events, such as terrorist attacks, other acts of violence or acts of war or hostility or the outbreak of infectious diseases. We are dependent on the willingness of our customers to travel by air. Since most of our customers travel by air to our Las Vegas and Macau properties, any terrorist act or other acts of violence, outbreak of hostilities, escalation of war, or any actual or perceived threat to the security of travel by air, could adversely affect our financial condition, results of operations and cash flows. In addition, the outbreak of infectious diseases, such as COVID-19, has severely disrupted, and is expected to continue to disrupt, domestic and international travel. The COVID-19 pandemic has resulted in governments, public institutions and other organizations imposing or recommending, and businesses and individuals implementing, restrictions on various activities or other actions to combat its spread, such as restrictions and bans on travel or transportation, stay-at-home directives, limitations on the size of gatherings, closures of work facilities, schools, public buildings and businesses,

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cancellation of events,including sporting events, concerts, conferences and meetings, and quarantines and lock-downs. Even when those restrictions are removed, consumer willingness to attend large scale conferences may be impacted for the foreseeable future due to continued concerns over safety and social distancing. See “—The global COVID-19 pandemic has continued to materially impact our business, financial results and liquidity, and such impact could worsen and last for an unknown period of time.”

Furthermore, although we have been able to purchase some insurance coverage for certain types of terrorist acts, insurance coverage against physical loss or business interruption resulting from war and some forms of terrorism continues to be unavailable.



Co-investing in our properties or businesses, including our investment in CityCenter,BetMGM, decreases our ability to manage risk. In addition to acquiring or developing hotels and resorts or acquiring companies that complement our business directly, we have from time to time invested, and expect to continue to invest, in properties or businesses as a co-investor. Co-investors often have shared control over the operation of the property.property or business. Therefore, the operation of such properties or businesses is subject to inherent risk due to the shared nature of the enterprise and the need to reach agreements on material matters. In addition, investments with other investors may involve risks such as the possibility that the co-investor might become bankrupt or not have the financial resources to meet its obligations, or have economic or business interests or goals that are inconsistent with our business interests or goals, or be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives. Consequently, actions by a co-investor might subject hotels and resortsthe properties or businesses owned by such entities to additional risk. Further, we may be unable to take action without the approval of our co-investors. Alternatively,co-investors, or our co-investors could take actions binding on the property without our consent. Additionally, should a co-investor become bankrupt, we could become liable for its share of liabilities.


For instance, CityCenter, which is 50% ownedexample, we share control of BetMGM with Entain with all major operating, investing and managed byfinancial activities requiring the consent of both members. Disagreements between us has a significantand Entain could arise in the future, including with respect to the amount and timing of indebtedness, which could adversely affect its business and its ability to meet its obligations.capital contributions. If CityCenter is unable to meet its financial commitments and we and our co-investorEntain are unable to support the future funding requirements, as necessary, such eventof BetMGM, then BetMGM may not have the resources to execute on the development or implementation of its strategies, including funding efforts to increase its market share, which could have adverse financial consequences to us.result in us not receiving the anticipated benefits from our investment. In addition, the agreements governing CityCenter’s indebtedness subject CityCenter and its subsidiariesif we are awarded a concession to significant financialdevelop an integrated casino resort in Japan, we would do so in a consortium with ORIX and other restrictive covenants, including restrictions on itslocal investors. As a result, we could be subject to additional risks related to being unable to directly control development activities or the timing of development completion, which may impact our ability to incur additional indebtedness, place liens upon assets, make distributions to us, make certain investments, consummate certain asset sales, enter into transactions with affiliates (including us) and mergecomplete the project on our anticipated timeline, or consolidate with any other person or sell, assign, transfer, lease, convey or otherwise dispose ofat all, or substantially all of its assets. The CityCenter credit facility also includes certain financial covenants that require CityCenter to maintain a maximum total net leverage ratio (as defined in CityCenter’s credit facility) for each quarter. We cannot be sure that CityCenter will be able to meet this test inwithin the future or that the lenders will waive any failure to meet the test.

agreed upon specifications.

Any of our future construction, development or expansion projects will be subject to significant development and construction risks, which could have a material adverse impact on related project timetables, costs and our ability to complete the projects.


Although our business model is primarily asset-light, we intend to continue to evaluate opportunities for future construction, development or expansion projects. Any of our future construction, development or expansion projects, such as our proposed integrated resort in Japan, will be subject to a number of risks, including:


•lack of sufficient, or delays in the availability of, financing;

•changes to plans and specifications;

•engineering problems, including defective plans and specifications;

•shortages of, and price increases in, energy, materials and skilled and unskilled labor, andlabor;

•pricing inflation, including wage inflation, in key supply markets;

•delays in obtaining or inability to obtain necessary permits, licenses and approvals;

•changes in laws and regulations, or in the interpretation and enforcement of laws and regulations, applicable to gaming, leisure, residential, real estate development or construction projects;

•labor disputes or work stoppages;

•availability of qualified contractors and subcontractors;

•disputes with and defaults by contractors and subcontractors;

•personal injuries to workers and other persons;

•environmental, health and safety issues, including site accidents and the spread of viruses;

•weather interferences or delays;

•fires, typhoons and other natural disasters;

•geological, construction, excavation, regulatory and equipment problems; and

•other unanticipated circumstances or cost increases.


The occurrence of any of these development and construction risks could increase the total costs, delay or prevent the construction, development, expansion or opening or otherwise affect the design and features of any future projects
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which we might undertake. For instance, we currently expect the total development costs of our Cotai project to be approximately $3.4 billion, excluding development fees eliminated in consolidation, capitalized interest and land-related costs, and we currently expect total development costs of our Massachusetts project to be approximately $960 million, excluding capitalized interest and land-related costs. While we believe that the overall budgets for these developments are reasonable, these development costs are estimates and the actual development costs may be higher than expected. We cannot guarantee that our construction costs or total project costs for future projects, including our development in Massachusetts, will not increase beyond amounts initially budgeted or that the expected design and features of current or future projects will not


change. In addition, the regulatory approvals associated with our development projects may require us to open future casino resorts by a certain specified time and to the extent we are unable to meet those deadlines, and any such deadlines are not extended, we may lose our regulatory approval to open a casino resort in a proposed jurisdiction, or incur payment penalties in connection with any delays which could have an adverse effect on our business, financial condition, results of operations and financial condition.

cash flows.


We also make significant capital expenditures to maintain and upgrade our resorts, which may disrupt operations and displace revenue at the properties, including revenue lost while rooms, restaurants and meeting spaces are under renovation and out of service.


We are required to commence gaming operations at MGM Springfield no later than September 2019, one year from the opening date approved by the Massachusetts Gaming Commission. If we are unable to meet this deadline, the Massachusetts Gaming Commission may suspend or revoke our gaming license. Pursuant to the Gaming Act, we are required to commence gaming operations at MGM Springfield no later than September 2019, one year from the opening date approved by the Massachusetts Gaming Commission (the “MGC”). If MGM Springfield fails to begin gaming operations by September 2019 or receive an extension, MGM Springfield is subject to suspension or revocation of its gaming license by the MGC and may, after being found by the MGC after a hearing to have acted in bad faith in its application, be assessed a fine of up to $50,000,000. Failure to meet the deadline could have an adverse effect on our financial condition, results of operations or cash flows from this property.

Our insurance coverage may not be adequate to cover all possible losses that our properties could suffer. In addition, our insurance costs may increase and we may not be able to obtain similar insurance coverage in the future. Although we have “all risk” property insurance coverage for our operating properties, which covers damage caused by a casualty loss (such as fire, natural disasters, acts of war, or terrorism or other acts of violence), each policy has certain exclusions. In addition, our property insurance coverage is in an amount that may be significantly less than the expected replacement cost of rebuilding the facilities if there was a total loss. Our level of insurance coverage also may not be adequate to cover all losses in the event of a major casualty. In addition, certain casualty events, such as labor strikes, nuclear events, acts of war, loss of income due to cancellation of room reservations or conventions due to fear of terrorism or other acts of violence, loss of electrical power due to catastrophic events, rolling blackouts or otherwise, deterioration or corrosion, insect or animal damage, and pollution, may not be covered at all under our policies. Therefore, certain acts could expose us to substantial uninsured losses.


In addition to the damage caused to our properties by a casualty loss, we may suffer business disruption as a result of these events or be subject to claims by third parties that may be injured or harmed. While we carry business interruption insurance and general liability insurance, this insurance may not be adequate to cover all losses in any such event.

Furthermore, the leases we entered into in connection with the MGP BREIT Venture Transaction and the Bellagio sale-leaseback transaction require us to maintain specified insurance coverage. We cannot assure you that we will continue to be able to obtain the types and limits of insurance coverage required by these leases and, to the extent such required insurance coverage cannot be obtained at commercially reasonable cost or at all, then we would need to obtain amendments to the leases or face a default by the applicable tenant under the lease, which could have material adverse effect on our business.


We renew our insurance policies (other than our builder’s risk insurance) on an annual basis. The cost of coverage may become so high that we may need to further reduce our policy limits, further increase our deductibles or self-insured retentions, or agree to certain exclusions from our coverage.


Any failure to protect our trademarks could have a negative impact on the value of our brand names and adversely affect our business. The development of intellectual property is part of our overall business strategy, and we regard our intellectual property to be an important element of our success. While our business as a whole is not substantially dependent on any one trademark or combination of several of our trademarks or other intellectual property, we seek to establish and maintain our proprietary rights in our business operations through the use of trademarks. We file applications for, and obtain trademarks in, the United States and in foreign countries where we believe filing for such protection is appropriate. Despite our efforts to protect our proprietary rights, parties may infringe our trademarks and our rights may be invalidated or unenforceable. The laws of some foreign countries do not protect proprietary rights to as great an extent as the laws of the United States. Monitoring the unauthorized use of our intellectual property is difficult. Litigation may be necessary to enforce our intellectual property rights or to determine the validity and scope of the proprietary rights of others. Litigation of this type could result in substantial costs and diversion of resource. We cannot assure you that all of the steps we have taken to protect our trademarks in the United States and foreign countries will be adequate to prevent imitation of our trademarks by others. The unauthorized use or reproduction of our trademarks could diminish the value of our brand and its market acceptance, competitive advantages or goodwill, which could adversely affect our business.


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We are subject to risks associated with doing business outside of the United States. Our operations outside of the United States are subject to risks that are inherent in conducting business under non-United States laws, regulations and customs. In particular, the risks associated with the operation of MGM Macau or any future operations in which we may engage in any other foreign territories, include:

changes in lawsA significant portion of our labor force is covered by collective bargaining agreements. Work stoppages and policies that govern operationsother labor problems could negatively affect our business and results of companies in Macauoperations. As of December 31, 2021, approximately 35,000 of our employees are covered by collective bargaining agreements. A prolonged dispute with the covered employees or any labor unrest, strikes or other foreign jurisdictions;

changesbusiness interruptions in non-United States government programs;

possible failure byconnection with labor negotiations or others could have an adverse impact on our employees or agents to comply with anti-bribery laws such as the United States Foreign Corrupt Practices Actoperations, and similar anti-bribery laws in other jurisdictions;

general economic conditions and policies in China, including restrictions on travel and currency movements;

difficulty in establishing, staffing and managing non-United States operations;

different labor regulations;

changes in environmental, health and safety laws;

outbreaks of diseases or epidemics;

potentially negative consequences from changes in or interpretations of tax laws;

political instability and actual or anticipated military and political conflicts;

economic instability and inflation, recession or interest rate fluctuations; and

uncertainties regarding judicial systems and procedures.

These risks, individually oradverse publicity in the aggregate,marketplace related to union messaging could further harm our reputation and reduce customer demand for our services. Also, wage and/or benefit increases resulting from new labor agreements may be significant and could also have an adverse impact on our results of operations. To the extent that our non-union employees seek union representation or elect union representation, we would have exposure to risks associated with representation proceedings, labor negotiations and/or economic impacts of newly negotiated labor agreements. Furthermore, we may have, or acquire in the future, multi-employer plans that are classified as “endangered,”

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“seriously endangered,” or “critical” status. For instance, Borgata’s most significant plan is the Legacy Plan of the UNITE HERE Retirement Fund, which has been listed in “critical status” and is subject to a rehabilitation plan. Plans in these classifications must adopt measures to improve their funded status through a funding improvement or rehabilitation plan, which may require additional contributions from employers (which may take the form of a surcharge on benefit contributions) and/or modifications to retiree benefits. In addition, while Borgata has no current intention to withdraw from these plans, a withdrawal in the future could result in the incurrence of a contingent liability that would be payable in an amount and at such time (or over a period of time) that would vary based on a number of factors at the time of (and after) withdrawal. Any such additional costs may be significant.

Our business is particularly sensitive to energy prices and a rise in energy prices could harm our operating results. We are a large consumer of electricity and other energy and, therefore, higher energy prices may have an adverse effect on our results of operations. Accordingly, increases in energy costs may have a negative impact on our operating results. Additionally, higher electricity and gasoline prices that affect our customers may result in reduced visitation to our resorts and a reduction in our revenues.

We may seek to expand through investments in other businesses and properties or through alliances or acquisitions, and we may also seek to divest some of our properties and other assets, any of which may be unsuccessful. We intend to consider strategic and complementary acquisitions and investments in other businesses, properties or other assets. Furthermore, we may pursue any of these opportunities in alliance with third parties, including MGP. Acquisitions and investments in businesses, properties or assets, as well as these alliances, are subject to risks that could affect our business, including risks related to:

•spending cash and incurring debt;
•assuming contingent liabilities;
•unanticipated issues in integrating information, communications and other systems;
•unanticipated incompatibility of purchasing, logistics, marketing and administration methods;
•retaining key employees; and
•consolidating corporate and administrative infrastructures.

We cannot assure you that we will be able to identify opportunities or complete transactions on commercially reasonable terms or at all. In addition, even if we are able to identify any such opportunities and complete transactions, we cannot assure you that we will realize the anticipated synergies and benefits of our acquisitions or that they will be accretive to our results of operations. Our estimates and assumptions regarding expected synergies and benefits of our acquisitions could materially change, including as a result of factors beyond our control, and could delay, decrease or eliminate the expected accretive effect of the acquisitions. In addition, even if we are able to successfully integrate new assets and businesses, the integration of such assets and businesses may result in unanticipated costs, competitive responses, loss of customer or other business relationships and the diversion of management attention, and the expansion of our operations in general, whether through acquisition, development or internal growth, could also cause us to incur substantial costs, including legal, professional and consulting fees.

In addition, we periodically review our business to identify properties or other assets that we believe either are non-core, no longer complement our business, are in markets which may not benefit us as much as other markets or could be sold at significant premiums. From time to time, we may attempt to sell these identified properties and assets. There can be no assurance, however, that we will be able to complete dispositions on commercially reasonable terms or at all.

The failure to maintain the integrity of our computer systems and customer information could result in damage to our reputation and/or subject us to fines, payment of damages, lawsuits and restrictions on our use of data.We collect and process information relating to our employees, guests, and others for various business purposes, including marketing and promotional purposes. The collection and use of personal data are governed by privacy laws and regulations enacted by the various states, the United States and other jurisdictions around the world. Privacy laws and regulations continue to evolve and on occasion may be inconsistent (or conflict) between jurisdictions. Various federal, state and foreign legislative or regulatory bodies may enact or adopt new or additional laws and regulations concerning privacy, data retention, data transfer, and data protection. For example, the European Union has adopted a data protection regulation known as the General Data Protection Regulation, which became fully enforceable in May 2018, that includes operational and compliance requirements with significant penalties for non-compliance. California has enacted a comprehensive privacy law, known as the California Consumer Privacy Act of 2018, which went into effect on January 1, 2020 and provides some of the strongest privacy requirements in the United States. In addition, new privacy requirements in California, Colorado, and Virginia generally go into effect on January 1, 2023.

Compliance with applicable privacy laws and regulations may increase our operating costs and/or adversely impact our ability to market our products, properties and services to our guests. In addition, non-compliance with applicable
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privacy laws and regulations by us (or in some circumstances non-compliance by third parties engaged by us), including accidental loss, inadvertent disclosure, unapproved dissemination or a breach of security on systems storing our data may result in damage to our reputation and/or subject us to fines, payment of damages, lawsuits or restrictions on our use or transfer of data. We rely on proprietary and commercially available systems, software, and tools to provide security for processing of customer and employee information, such as payment card and other confidential or proprietary information. Our data security measures are reviewed and evaluated regularly; however, they might not protect us against increasingly sophisticated and aggressive threats including, but not limited to, computer malware, viruses, hacking and phishing attacks by third parties. In addition, while we maintain cyber risk insurance to assist in the cost of recovery from a significant cyber event, such coverage may not be sufficient.

We also rely extensively on computer systems to process transactions, maintain information and manage our businesses. Disruptions in the availability of our computer systems, through cyber-attacks or otherwise, could impact our ability to service our customers and adversely affect our sales and the results of operations. For instance, there has been an increase in criminal cyber security attacks against companies where customer and company information has been compromised and company data has been destroyed. Our information systems and data, including those we maintain with our third-party service providers, have been subject to cyber security breaches in the past and may be subject to cyber security breaches in the future. In addition, our third-party information system service providers face risks relating to cyber security similar to ours, and we do not directly control any of such parties’ information security operations. A significant theft, loss or fraudulent use of customer or company data maintained by us or by a third-party service provider could have an adverse effect on our reputation, cause a material disruption to our operations, and result in remediation expenses, regulatory penalties and litigation by customers and other parties whose information was subject to such attacks, all of which could have a material adverse effect on our business, results of operations and cash flows.

We are subject to risks related to corporate social responsibility and reputation. Many factors influence our reputation and the value of our brands including the perception held by our customers, business partners, other key stakeholders and the communities in which we do business. Our business faces increasing scrutiny related to environmental, social and governance factors and risk of damage to our reputation and the value of our brands if we fail to act responsibly in several areas including diversity and inclusion, community engagement and philanthropy, environmental sustainability, plastic pollution, climate change, responsible gaming, supply chain management, workplace conduct, human rights, and many others, some of which may be unforeseen. Any harm to our reputation could further impact employee engagement and retention and the willingness of customers and our partners to do business with us, which could have a material adverse effect on our business, results of operations and cash flows.

We are subject to risks and costs related to climate change. Extreme weather conditions, potentially exacerbated by climate change, may cause property damage or interrupt business, which could harm our business and results of operations. Certain of our properties are located in areas that may be subject to extreme weather conditions, including, but not limited to, hurricanes, floods, tornados, wildfires, and winter storms in the United States and severe typhoons in Macau. Such extreme weather conditions may interrupt our operations or the operations of critical suppliers, damage our properties, and reduce the number of customers who visit our facilities in such areas. In addition, our operations or the operations of critical suppliers could be adversely impacted by a drought or other cause of water stress or shortage. A severe drought of extensive duration experienced in Las Vegas or in the other regions in which we operate or source critical supplies could adversely affect our business. Although we maintain both property and business interruption insurance coverage for certain extreme weather conditions, such coverage is subject to deductibles and limits on maximum benefits, including limitation on the coverage period for business interruption, and we cannot assure you that we will be able to fully insure such losses or fully collect, if at all, on claims resulting from such extreme weather conditions.

Furthermore, such extreme weather conditions may result in reduced availability or increased price volatility of certain critical supplies, may interrupt or impede access to our affected properties, and may cause visits to our affected properties to decrease for an indefinite period. Additionally, many states and municipalities have begun to adopt laws and policies on climate change and emission reduction targets. Changes in federal, state, and local legislation and regulation based on concerns about climate change could result in increased regulatory costs, which may include capital expenditures on our existing properties to ensure compliance with any new or updated regulations, which may potentially adversely affect our operations. There can be no assurance that the potential impacts of climate change and severe weather will not have a material adverse effect on our properties, operations or business.

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Risks Related to Legal and Regulatory Matters and Changes in Public Policy

Our businesses are subject to extensive regulation and the cost of compliance or failure to comply with such regulations may adversely affect our business and results of operations. Our ownership and operation of gaming facilities is subject to extensive regulation by the countries, states and provinces in which we operate. These laws, regulations and ordinances vary from jurisdiction to jurisdiction, but generally concern the responsibility, financial condition.

stability and character of the owners and managers of gaming operations as well as persons financially interested or involved in gaming operations. As such, our gaming regulators can require us to disassociate ourselves from suppliers or business partners found unsuitable by the regulators or, alternatively, cease operations in that jurisdiction. In addition, unsuitable activity on our part or on the part of our domestic or foreign unconsolidated affiliates or subsidiaries in any jurisdiction could have a negative effect on our ability to continue operating in other jurisdictions. The regulatory environment in any particular jurisdiction may change in the future and any such change could have a material adverse effect on our results of operations. Furthermore, our iGaming and online sports betting initiatives may be particularly subject to risks related to potential changes in the regulatory environment as a result of the continued development of regulations in this industry. For example, in 2018, the U.S. Department of Justice (“DOJ”) reversed its previously-issued opinion published in 2011, which stated that interstate transmissions of wire communications that do not relate to a “sporting event or contest” fall outside the purview of the Wire Act of 1961 (“Wire Act”). The DOJ’s updated opinion concluded instead that the Wire Act was not uniformly limited to gaming relating to sporting events or contests and that certain of its provisions apply to non-sports-related wagering activity. In June 2019, a federal district court in New Hampshire ruled that the DOJ’s new interpretation of the Wire Act was erroneous and vacated DOJ’s new opinion. The DOJ appealed the decision of the district court to the U.S. Court of Appeals for the First Circuit. In January 2021, the Court of Appeals essentially affirmed the decision of the district court, and the DOJ did not file a further appeal. For a summary of gaming and other regulations that affect our business, see “Regulation and Licensing” and Exhibit 99.1 to this Annual Report on Form 10-K.


Further, our directors, officers, key employees and investors in our properties must meet approval standards of certain state and foreign regulatory authorities. If state regulatory authorities were to find such a person or investor unsuitable, we would be required to sever our relationship with that person or the investor may be required to dispose of his, her or its interest in the property. State regulatory agencies may conduct investigations into the conduct or associations of our directors, officers, key employees or investors to ensure compliance with applicable standards. Certain public and private issuances of securities, borrowings under credit agreements, guarantees of indebtedness and other transactions also require the approval of certain regulatory authorities.

Macau laws and regulations concerning gaming and gaming concessions are complex, and a court or administrative or regulatory body may in the future render an interpretation of these laws and regulations, or issue new or modified regulations, that differ from MGM China’s interpretation, which could have a material adverse effect on its business, financial condition and results of operations. In addition, MGM Grand Paradise's activities in Macau are subject to administrative review and approval by various government agencies. We cannot assure you that MGM Grand Paradise will be able to obtain all necessary approvals, and any such failure to do so may materially affect its long-term business strategy and operations. Macau laws permit redress to the courts with respect to administrative actions; however, to date such redress is largely untested in relation to gaming issues.

In addition to gaming regulations, we are also subject to various federal, state, local and foreign laws and regulations affecting businesses in general. These laws and regulations include, but are not limited to, restrictions and conditions concerning alcoholic beverages, environmental matters, smoking, employees, currency transactions, taxation, zoning and building codes, and marketing and advertising. For instance, we are subject to certain federal, state and local environmental laws, regulations and ordinances, including the Clean Air Act, the Clean Water Act, the Resource Conservation Recovery Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Energy Policy Act, the Safe Drinking Water Act, Renewable Portfolio Standards, the Oil Pollution Act of 1990, and many others. Under various federal, state and local environmental laws and regulations, an owner or operator of real property may be held liable for the costs of removal or remediation of certain hazardous or toxic substances or wastes located on its property, regardless of whether or not the present owner or operator knows of, or is responsible for, the presence of such substances or wastes. Such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. In addition, effective January 1, 2019, smoking in casinos in Macau, including MGM Macau and MGM Cotai, is only permitted inside specially ventilated smoking rooms, rather than outside smoking areas or VIP areas. The likelihood or outcome of similar legislation in other jurisdictions and referendums in the future cannot be predicted, though any smoking ban would be expected to negatively impact our financial performance.

We also deal with significant amounts of cash in our operations and are subject to recordkeeping and reporting obligations as required by various anti-money laundering laws and regulations. For instance, we are subject to regulation under the Currency and Foreign Transactions Reporting Act of 1970, commonly known as the “Bank Secrecy Act”, which, among other things, requires us to report to the Internal Revenue Service (“IRS”) any currency transactions in excess of $10,000 that occur within a 24-hour gaming day, including identification of the individual(s) involved in the currency
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transaction. We are also exposedrequired to a varietyreport certain suspicious activity where we know, suspect or have reason to suspect transactions, among other things, involve funds from illegal activity or are intended to evade federal regulations or avoid reporting requirements or have no business or lawful purpose. In addition, under the Bank Secrecy Act we are subject to various other rules and regulations involving reporting, recordkeeping and retention. Our compliance with the Bank Secrecy Act is subject to periodic examinations by the IRS. Any such laws and regulations could change or could be interpreted differently in the future, or new laws and regulations could be enacted. Any violations of market risks,the anti-money laundering laws, including the effectsBank Secrecy Act, or regulations by any of changesour properties could have an adverse effect on our financial condition, results of operations or cash flows.

Furthermore, the COVID-19 pandemic has resulted in foreign currency exchange rates. If the United States dollar strengthens in relationgovernments, public institutions and other organizations imposing or recommending restrictions on various activities or other actions to combat its spread. See “—The global COVID-19 pandemic has continued to materially impact our business, financial results and liquidity, and such impact could worsen and last for an unknown period of time.” In addition to the currencies of other countries, our United States dollar reported income from sources where revenue is denominatedpandemic-related restrictions that resulted in the currenciestemporary closures of our properties during 2020, governmental or other such countries will decrease.

COVID-19-related restrictions have been extended or reimposed from time-to-time and new restrictions may be imposed in the future.

Any violation of the Foreign Corrupt Practices Act or any other similar anti-corruption laws could have a negative impact on us. AHistorically, a significant portion of our revenue iswas derived from operations outside the United States, which exposes us to complex foreign and U.S. regulations inherent in doing cross-border business and in each of the countries in which we transact business. We are subject to compliance with the United States Foreign Corrupt Practices Act (“FCPA”) and other similar anti-corruption laws, which generally prohibit companies and their intermediaries from making improper payments to foreign government officials for the purpose of obtaining or retaining business. While our employees and agents are required to comply with these laws, we cannot be sure that our internal policies and procedures will always protect us from violations of these laws, despite our commitment to legal compliance and corporate ethics. Violations of these laws by us or our non-controlled ventures may result in severe criminal and civil sanctions as well as other penalties against us, and the SEC and U.S. Department of Justice continue to vigorously pursue enforcement of the FCPA. The occurrence or allegation of these types of risks may adversely affect our business, performance, prospects, value, financial condition, and results of operations.


If the jurisdictions in which we operate increase gaming taxes and fees, as well as other taxes and fees, our results could be adversely affected.State and local authorities raise a significant amount of revenue through taxes and fees, including taxes and fees on gaming activities. From time to time, legislators and government officials have proposed changes in tax laws, or in the administration of such laws, affecting the gaming industry. Periods of economic downturn or uncertainty and budget deficits may intensify such efforts to raise revenues through increases in gaming or other taxes, the imposition of new taxes or changes to tax laws that result in increased taxes to us. If the jurisdictions in which we operate were to increase taxes, impose new taxes or change existing tax laws, our financial condition and results of operations could be materially adversely affected.


The future recognition of our foreign tax credit deferred tax asset is uncertain, and the amount of valuation allowance we may apply against such deferred tax asset may change materially in future periods.We currently have significant deferred tax assets resulting from foreign tax credit carryforwards that are available to reduce taxes attributable to potential taxable foreign-sourced income in future periods, including the recapture of overall domestic losses to the extent of 50 percent of U.S. taxable income per year. We evaluate our foreign tax credit deferred tax asset for recoverability and record a valuation allowance to the extent that we determine it is not more likely than not such asset will be recovered. This evaluation is based on all available evidence, including assumptions concerning future U.S. operating profits and foreign source income. As a result, significant judgment is required in assessing the possible need for a valuation allowance and changes to our assumptions could result in a material change in the valuation allowance with a corresponding impact on the provision for income taxes in the period including such change.

We face risks related to pending claims that have been, or future claims that may be, brought against us. Claims have been brought against us and our subsidiaries in various legal proceedings, and additional legal and tax claims arise from time to time. We may not be successful in the defense or prosecution of our current or future legal proceedings, which could result in settlements or damages that could significantly impact our business, financial condition, results of operations and reputation. Please see the further discussion in “Legal Proceedings” and Note 12 in the accompanying consolidated financial statements.


Risks Related to Our Macau Operations

We have agreed not to have any interest or involvement in gaming businesses in China, Macau, Hong Kong and Taiwan, other than through MGM China. As a result of the extension of the Macau gaming subconcession, we entered into a First Renewed Deed of Non-Compete Undertakings with MGM China and Ms. Ho, Pansy Catilina Chiu King (“Ms.
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A significant portion of our labor force is covered by collective bargaining agreements. Work stoppages and other labor problems could negatively affect our business and results of operations. As of December 31, 2017, approximately 36,000 of our employees are covered by collective bargaining agreements. The collective bargaining agreements covering most of our Las Vegas union employees expire in 2018. A prolonged dispute with the covered employees or any labor unrest, strikes or other business interruptions in connection with labor negotiations or others could have an adverse impact on our operations. Further, adverse publicity in the marketplace related to union messaging could further harm our reputation and reduce customer demand for our services. Also, wage and/or benefit increases resulting from new labor agreements may be significant and could also have an adverse impact on our results of operations. For instance, Beau Rivage is currently engaged in negotiations for an initial collective bargaining agreement with a council of unions representing various hotel and food and beverage constituencies, Borgata will be engaged in negotiations with three unions in 2018, and MGM National Harbor is in negotiations with one union. In addition, to the extent that our non-union employees join unions, we would have greater exposure to risks associated with labor problems. Furthermore, we may have, or acquire in the future, multi-employer plans that are classified as “endangered,” “seriously endangered,” or “critical” status. For instance, Borgata’s most significant plan as of December 31, 2017 is the Legacy Plan of the National Retirement Fund, which has



Ho”), pursuant to which we are restricted from having any interest or involvement in gaming businesses in the People’s Republic of China, Macau, Hong Kong and Taiwan, other than through MGM China. While gaming is currently prohibited in China, Hong Kong and Taiwan, if it is legalized in the future our ability to compete in these locations could be limited until the earliest of (i) the date MGM China’s ordinary shares cease to be listed on The Stock Exchange of Hong Kong Limited or (ii) the last day of MGM Grand Paradise's subconcession for operation of casino games (or any extension thereof); or (iii) the date when our ownership of MGM China shares is less than 20% of the then-issued share capital of MGM China.

been listed in “critical status” and is subject to a rehabilitation plan. Plans in these classifications must adopt measures to improve their funded status through a funding improvement or rehabilitation plan, which may require additional contributions from employers (which may take the form of a surcharge on benefit contributions) and/or modifications to retiree benefits. In addition, while Borgata has no current intention to withdraw from these plans, a withdrawal in the future could result in the incurrence of a contingent liability that would be payable in an amount and at such time (or over a period of time) that would vary based on a number of factors at the time of (and after) withdrawal. Any such additional costs may be significant.


Our businessThe Macau government can terminate MGM Grand Paradise’s subconcession under certain circumstances without compensating MGM Grand Paradise, exercise its redemption right with respect to the subconcession, or refuse to grant MGM Grand Paradise an extension of the subconcession in 2022, or MGM Grand Paradise may be unsuccessful in obtaining a gaming concession when a new public tender is particularly sensitive to energy prices andheld by the Macau government, any of which would have a rise in energy prices could harm our operating results. We are a large consumer of electricity and other energy and, therefore, higher energy prices may have anmaterial adverse effect on our business, financial condition,results of operations and cash flows. The Macau government has the right to unilaterally terminate the subconcession in the event of fundamental non-compliance by MGM Grand Paradise with applicable Macau laws or MGM Grand Paradise’s basic obligations under the subconcession contract. MGM Grand Paradise has the opportunity to remedy any such non-compliance with its fundamental obligations under the subconcession contract within a period to be stipulated by the Macau government. Upon such termination, all of MGM Grand Paradise’s casino area premises and gaming-related equipment would be transferred automatically to the Macau government without compensation to MGM Grand Paradise, and we would cease to generate any revenues from these operations. Accordingly, increasesWe cannot assure you that MGM Grand Paradise will perform all of its obligations under the subconcession contract in energy costs may have a negative impact on our operating results. Additionally, higher electricity and gasoline pricesway that affect our customers may result in reduced visitationsatisfies the requirements of the Macau government.


Furthermore, under the subconcession contract, MGM Grand Paradise is obligated to our resorts and a reduction in our revenues.

The failure to maintain the integrity of our computer systems and internal customer information could result in damage of reputation and/or subject us to fines, payment of damages, lawsuits or restrictions on our use or transfer of data. We collect and store information relating to our employees, guests, and others for various business purposes, including marketing and promotional purposes. The collection and use of personal data are governed by privacycomply with any laws and regulations enactedthat the Macau government might promulgate in the United States and other jurisdictions around the world. Privacyfuture. We cannot assure you that MGM Grand Paradise will be able to comply with these laws and regulations continue to evolve and on occasion may be inconsistent from one jurisdiction to another. Various federal, state and foreign legislative or regulatory bodies may enact or adopt new or additionalthat these laws and regulations concerning privacy, data retention, data transfer, and data protection issues. For example, the European Union has adopted a data protection regulation, known as the General Data Protection Regulation, which will become fully enforceable in May 2018 that includes operational and compliance requirements that are different from those currently in place and that also include significant penalties for non-compliance.

Compliance with applicable privacy laws and regulations may increase our operating costs and/orwould not adversely impactaffect our ability to marketconstruct or operate our products, propertiesMacau businesses. If any disagreement arises between MGM Grand Paradise and servicesthe Macau government regarding the interpretation of, or MGM Grand Paradise’s compliance with, a provision of the subconcession contract, MGM Grand Paradise will be relying on a consultation and negotiation process with the Macau government. During any consultation or negotiation, MGM Grand Paradise will be obligated to our guests. In addition, non-compliancecomply with applicable privacy laws and regulationsthe terms of the subconcession contract as interpreted by us (or in somethe Macau government. Currently, there is no precedent concerning how the Macau government will treat the termination of a concession or subconcession upon the occurrence of any of the circumstances non-compliance by third parties engaged by us), including accidentalmentioned above. The loss inadvertent disclosure, unapproved dissemination or a breach of security on systems storing our data may result in damage of reputation and/or subjectthe subconcession would require us to fines, payment of damages, lawsuits or restrictions on our use or transfer of data. We rely on proprietary and commercially available systems, software, tools and monitoring to provide security for processing, transmission and storage of customer and employee information, such as payment card and other confidential or proprietary information. Our data security measures are reviewed and evaluated regularly; however, they might not protect us against increasingly sophisticated and aggressive threats including, but not limited to, computer malware, viruses, and hacking and phishing attacks by third parties. In addition, while we maintain cyber risk insurance to assistcease conducting gaming operations in the cost of recovery from a significant cyber event, such coverage may not be sufficient.

We also rely extensively on computer systems to process transactions, maintain information and manage our businesses. Disruptions in the availability of our computer systems, through cyber-attacks or otherwise, could impact our ability to service our customers and adversely affect our sales and the results of operations. For instance, there has been an increase in criminal cyber security attacks against companies where customer and company information has been compromised and company data has been destroyed. Our information systems and records, including those we maintain with our third-party service providers, may be subject to cyber security breaches in the future. In addition, our third-party information system service providers face risks relating to cyber security similar to ours, and we do not directly control any of such parties’ information security operations. A significant theft, loss or fraudulent use of customer or company data maintained by us or by a third-party service provider could have an adverse effect on our reputation, cause a material disruption to our operations and management team, and result in remediation expenses, regulatory penalties and litigation by customers and other parties whose information was subject to such attacks, all ofMacau, which couldwould have a material adverse effect on our business, financial condition, results of operations and cash flows.


We areIn addition, the subconcession contract expires on June 26, 2022. Pursuant to the current Macau gaming law, upon reaching the maximum duration of 20 years, the term of the concessions may be extended one or more times by order of the Chief Executive, which period may not exceed, in total, 5 years. On January 14, 2022, the Macau Government disclosed the content of a bill to amend Macau gaming law, which followed a 45-day public consultation process regarding draft amendment proposals that were issued in September 2021. Under the bill, the existing subconcessions will be discontinued and a maximum of six concessions will be awarded for a term to be specified in the concession contract that may not exceed 10 years and which may be extended by three years, under certain circumstances. The bill is subject to risks relateddebate and approval by the Macau Legislative Assembly. The approval of the new gaming law bill will precede the public tender for the awarding of new gaming concessions and to corporate social responsibilitydate the Macau Government has provided no indication as to whether the public tender will take place before expiry of the existing gaming concessions and reputation. Many factors influence our reputationsubconcessions, which is on June 26, 2022, but acknowledged that it could consider the extension of the existing concessions and subconcessions beyond their current term if the valuepublic tender is held at a later date. Unless MGM Grand Paradise's gaming subconcession is extended, or legislation with regard to reversion of our brands includingcasino premises is amended, the perception held by our customers, business partners, other key stakeholderscasino area premises and gaming-related equipment subject to reversion will automatically be transferred to the communitiesMacau Government upon expiration, and MGM Grand Paradise will cease to generate any revenues from such gaming operations. In addition, certain events relating to the loss, termination, rescission, revocation or modification of MGM Grand Paradise’s gaming subconcession in which we do business. Our business faces increasing scrutiny related to environmental, social and governance activities and risk of damage to our reputation and the value of our brands if we fail to act responsibly in a number of areas,Macau, where such as environmental stewardship, supply chain management, climate change, diversity and inclusion, workplace conduct, human rights, philanthropy and support for local communities. Any harm to our reputation could impact employee engagement and retention and the willingness of customers and our partners to do business with us, which couldevents have a material adverse effect on the financial condition, business, properties, or results of operations of MGM China, taken as a whole, may result in a special put option triggering event under MGM China’s senior notes and an event of default under MGM China’s revolving credit facilities. Beginning on April 20, 2017, the Macau government may redeem the subconcession contract by providing us at least 1 year prior notice. In the event the Macau government exercises this redemption right, MGM Grand Paradise is entitled to fair compensation or indemnity. The amount of such compensation or indemnity will be determined based on the amount of gaming and non-gaming revenue generated by MGM Grand Paradise, excluding the convention and exhibition facilities, during the taxable year prior to the redemption, before deducting interest, depreciation and amortization, multiplied by the number of remaining years before expiration of the subconcession. We cannot assure you that MGM Grand Paradise will be able to obtain an extension of the subconcession contract or be awarded a new gaming concession on terms favorable to MGM Grand Paradise or at all. In

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addition, there is uncertainty on the terms associated with any extension, which could include additional fees or other financial commitments that may have an adverse impact on the financial position of MGM Grand Paradise. We also cannot assure you that if the subconcession is redeemed, the compensation paid to MGM Grand Paradise will be adequate to compensate for the loss of future revenues.

We are subject to risks associated with doing business outside of the United States. Our operations outside of the United States are subject to risks that are inherent in conducting business under non-United States laws, regulations and customs. In particular, the risks associated with the operation of MGM China or any future operations in which we may engage in any other foreign territories, include:

•changes in laws and policies that govern operations of companies in Macau or other foreign jurisdictions;
•changes in non-United States government programs;
•possible failure by our employees or agents to comply with anti-bribery laws such as the United States Foreign Corrupt Practices Act and similar anti-bribery laws in other jurisdictions;
•general economic conditions and policies in China, including restrictions on travel and currency movements;
•difficulty in establishing, staffing and managing non-United States operations;
•different labor regulations;
•changes in environmental, health and safety laws;
•outbreaks of diseases or epidemics, including the COVID-19 pandemic;
•potentially negative consequences from changes in or interpretations of tax laws;
•political instability and actual or anticipated military and political conflicts;
•economic instability and inflation, recession or interest rate fluctuations; and
•uncertainties regarding judicial systems and procedures.

These risks, individually or in the aggregate, could have an adverse effect on our business, financial condition, results of operations and cash flows.


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We may seek to expand through investments in other businesses and properties or through alliances or acquisitions, and we may also seek to divest some of our properties and other assets, any of which may be unsuccessful. We intend to consider strategic and complementary acquisitions and investments in other businesses, properties or other assets. Furthermore, we may pursue any of these opportunities in alliance with third parties, including MGP. Acquisitions and investments in businesses, properties or assets, as well as these alliances, are subject to risks that could affect our business, including risks related to:

spending cash and incurring debt;

assuming contingent liabilities;

unanticipated issues We are also exposed to a variety of market risks, including the effects of changes in integrating information, communications and other systems;

unanticipated incompatibility of purchasing, logistics, marketing and administration methods;

retaining key employees; and

consolidating corporate and administrative infrastructures.

We cannot assure you that we will be able to identify opportunities or complete transactions on commercially reasonable terms or at all, or that we will actually realize any anticipated benefits from such acquisitions, investments or alliances. In addition, even if we are able to successfully integrate new assets and businesses, the integration of such assets and businesses may result in unanticipated costs, competitive responses, loss or customer or other business relationships and the diversion of management attention.

In addition, we periodically review our business to identify properties or other assets that we believe either are non-core, no longer complement our business, are in markets which may not benefit us as much as other markets or could be sold at significant premiums. From time to time, we may attempt to sell these identified properties and assets. There can be no assurance, however, that we will be able to complete dispositions on commercially reasonable terms or at all.

foreign currency exchange rates. If the jurisdictionsUnited States dollar strengthens in which we operate increase gaming taxes and fees,relation to the currencies of other countries, our results could be adversely affected.State and local authorities raise a significant amount ofUnited States dollar reported income from sources where revenue through taxes and fees on gaming activities. From time to time, legislators and government officials have proposed changes in tax laws, oris denominated in the administrationcurrencies of other such laws, affecting the gaming industry. Periods of economic downturn or uncertainty and budget deficits may intensify such efforts to raise revenues through increases in gaming taxes. If the jurisdictions in which we operate were to increase gaming taxes or fees, depending on the magnitude of the increase and any offsetting factors, our financial condition and results of operations could be materially adversely affected. For instance, income generated from gaming operations of MGM Grand Paradise currently has the benefit of a corporate tax exemption in Macau, which exempts us from paying the 12% complementary tax on profits generated by the operation of casino games. This exemption is effective through March 31, 2020, which also runs concurrent with the end of the term of the current gaming subconcession. Due to the uncertainty concerning taxation after the subconcession renewal process, we cannot assure you that any extensions of the tax exemptioncountries will be granted beyond March 31, 2020.

decrease.

Conflicts of interest may arise because certain of our directors and officers are also directors of MGM China, the holding company for MGM Grand Paradise which owns and operates MGM Macau and MGM Cotai. As a result of the initial public offering of shares of MGM China common stock in 2011, MGM China now has stockholders who are not affiliated with us, and we and certain of our officers and directors who also serve as officers and/or directors of MGM China may have conflicting fiduciary obligations to our stockholders and to the minority stockholders of MGM China. Decisions that could have different implications for us and MGM China, including contractual arrangements that we have entered into or may in the future enter into with MGM China, may give rise to the appearance of a potential conflict of interest or an actual conflict of interest.


ITEM 1B.    UNRESOLVED STAFF COMMENTS

None.

32

ITEM 1B.  

UNRESOLVED STAFF COMMENTS


None.


ITEM 2.

PROPERTIES


Our principal executive offices are located at Bellagio. Our significant land holdings are described below; unless otherwise indicated, all

ITEM 2.    PROPERTIES

The location and general characteristics of our properties are indirectly owned by us. We also own or lease various other improved and unimproved propertiesprovided in Las Vegas and other locationsPart I, Item 1. Business. As detailed in the United Statesaforementioned section, the majority of our facilities are subject to leases of the underlying real estate assets, which among other things, includes the land underlying the facility and certain foreign countries.

Domestic resorts and other land

the buildings used in the operations.

The following table lists certain of our domestic resorts land holdings, ground leases and other land holdings on a consolidated basis, including land held in connection with our proposed development properties andprincipal land and ground leases heldleasehold holdings as of December 31, 2021.
Approximate
Name and LocationAcres
Las Vegas Strip Resorts
Aria(1)
64
Bellagio(2)
75
MGM Grand Las Vegas(3)
102
Mandalay Bay(3)
124
The Mirage(4)
77
Luxor(4)(5)
73
Excalibur(4)
51
New York-New York(4)(6)
23
Park MGM(4)
21
Regional Operations
MGM Grand Detroit (Detroit, Michigan)(4)(7)
27
Beau Rivage (Biloxi, Mississippi)(4)(8)
40
Gold Strike Tunica (Tunica, Mississippi)(4)
24
MGM National Harbor (Prince George's County, Maryland)(4)(9)
23
Borgata (Atlantic City, New Jersey)(4)(10)
46
MGM Springfield (Springfield, Massachusetts)(4)
14
MGM Northfield Park (Northfield, Ohio)(4)
113
Empire City (Yonkers, New York)(4)(11)
97
MGM China
MGM Macau(12)
10
MGM Cotai(12)
18
(1)Subject to a master lease agreement between a subsidiary of ours and funds managed by Blackstone.
(2)Subject to a lease agreement between a subsidiary of ours and Bellagio BREIT Venture.
(3)Subject to a master lease agreement between a subsidiary of ours and MGP BREIT Venture.
(4)Subject to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership.
(5)58 acres are subject to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership. We own an additional 15 acres of land located across the Las Vegas Strip from Luxor.
(6)Includes 3 acres of land related to The Park entertainment district development located between Park MGM and New York-New York.
(7)24 acres are subject to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership.
(8)26 acres are subject to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership, which we leaseleases 10 acres pursuant to the termsa tidelands lease with a third party.
(9)All 23 acres are subject to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership, which leases all 23 acres pursuant to a ground lease with a third party.
(10)37 acres are subject to a master lease. 

lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership, which leases 11 acres pursuant to a ground lease with a third party.

Approximate

Name and Location

Acres

Notes

Las Vegas, Nevada operations

Bellagio

77

Approximately two acres of the site are subject to two ground leases.

MGM Grand Las Vegas

102

Mandalay Bay

124

The Mirage

77

Luxor

73

Includes 15 acres of land located across the Las Vegas Strip from Luxor.

Excalibur

51

New York-New York

23

Includes three acres of land related to The Park entertainment district development located between Monte Carlo and New York-New York.

Monte Carlo

21

Circus Circus Las Vegas

102

Includes 34 acres of land located north of Circus Circus Las Vegas.

Other domestic operations

MGM Grand Detroit (Detroit, Michigan)

27

Beau Rivage (Biloxi, Mississippi)

42

10 acres are subject to a tidelands lease.

Gold Strike (Tunica, Mississippi)

24

MGM National Harbor (Prince George's County, Maryland)

23

All 23 acres are subject to a ground lease.

Borgata (Atlantic City, New Jersey)

46

11 acres are subject to ground leases.

Other

T-Mobile Arena (Las Vegas, Nevada)

17

Located adjacent to New York-New York and leased under a 50 year ground lease to Las Vegas Arena Company.

MGM Springfield (Springfield, Massachusetts)

14

Tunica, Mississippi

388

We own an undivided 50% interest in this land with an unaffiliated, gaming company.

Atlantic City, New Jersey

125

Approximately 74 acres are suitable for development.

Shadow Creek Golf Course (North Las Vegas, Nevada)

310

Includes 66 acres of land adjacent to the golf course.

Fallen Oak Golf Course (Saucier, Mississippi)

511

Primm Valley Golf Club (Stateline, California)

573

Located at the California state line, four miles from Primm, Nevada. Includes 125 acres of land adjacent to the golf club.

(11)41 acres are subject to a master lease agreement between a subsidiary of ours and a subsidiary of the Operating Partnership. We own an additional 56 acres adjacent to the property retained for potential future development.

(12)Subject to separate land concession agreements with the Macau government.

The land and substantially all of the assets of MGM Grand Las Vegas and Bellagio secureMGP’s properties, indicated within the obligations under our senior credit facility. In addition, the senior credit facility is secured by a pledge of the equity or limited liability company interests of the subsidiaries that own MGM Grand Las Vegas and Bellagio.


MGM China

MGM Macau occupies an approximately 10 acre site and MGM Cotai occupies an approximately 18 acre site, both of which are possessed under separate 25-year land use right agreements with the Macau government. The MGM China credit facility is secured by MGM Grand Paradise’s interest in the Cotai and MGM Macau land use rights, and MGM China, MGM Grand Paradise and their guarantor subsidiaries have granted a security interest in substantially all of their assets to secure the facility. As of December 31, 2017, approximately $2.3 billion was outstanding under the MGM China credit facility. These borrowings are non-recourse to us.

Operating Partnership

In connection with the initial public offering of MGP, the Borgata transaction and the MGM National Harbor transaction, the real estate assets of The Mirage, Mandalay Bay, Luxor, New York-New York, Monte Carlo, Excalibur, The Park, Gold Strike Tunica, MGM Grand Detroit, Borgata, Beau Rivage and MGM National Harbor were transferred to a subsidiary of the Operating Partnership in which we have a controlling interest. All of these properties,table above, other than MGM National Harbor, Empire City, and MGM Springfield, secure the obligations under the Operating Partnership’s credit agreement and are leased by us under an amended master lease that expires in 2046 (after giving effect to our renewal options).agreement. These borrowings are non-recourse to us.

Unconsolidated Affiliates

CityCenter occupies approximately 67 acres of land between Bellagio and Monte Carlo. The main site, along with substantially all of CityCenter’s assets, serves as collateral for CityCenter’s senior credit facility. As of December 31, 2017, CityCenter had not drawn on its $125 million revolving credit facility and had $1.6 billion in term loans outstanding. These borrowings are non-recourse to us.

The Las Vegas Arena Company leases under a long-term ground lease approximately 17 acres of land owned by us and located between Frank Sinatra Drive and New York-New York, adjacent to the Las Vegas Strip. Substantially all of the assets of Las Vegas Arena Company are used as collateral for its senior secured credit facility. In connection with this senior secured credit facility, we and Anschutz Entertainment Group, Inc. (“AEG”) each entered into a repayment guarantee for the term loan B. As of December 31, 2017, the outstanding principal balance under term loan A was $129 million and the outstanding principal balance under term loan B was $50 million. See Note 12 to the accompanying consolidated financial statements for discussion of our repayment guarantee.


Other than as described above, none of our properties are subject to any major encumbrance.

ITEM 3.

LEGAL PROCEEDINGS

33

October 1 litigation. The Company and/or certain



ITEM 3.    LEGAL PROCEEDINGS

See discussion of its subsidiaries have been named as defendantslegal proceedings in a number of lawsuits related to the October 1, 2017 shooting in Las Vegas. The matters involve in large degree the same legalNote 12 – Commitments and factual issues, in each case being filed on behalf of individuals who are seeking damages for emotional distress, physical injury, medical expenses, economic damages and/or wrongful death based on assertions that the Company and/or certain of its subsidiaries were negligent. Lawsuits were first filed in October 2017 and include actions filed by multiple individuals Contingencies in the District Court of Clark County, Nevada and in the Superior Court of Los Angeles County, California. Some of the original actions have been voluntarily dismissed, and plaintiffs’ counsel indicate they anticipate re-filing the lawsuits in similar form. Additional lawsuits related to this incident may be filed in the future.

We are currently unable to reliably predict the developments in, outcome of, and economic costs and other consequences of pending or future litigation related to this matter. We will continue to investigate the factual and legal defenses, and evaluate these matters based on subsequent events, new information and future circumstances. We intend to defend against these lawsuits and ultimately believe we should prevail, but litigation of this type is inherently unpredictable. Although there are significant procedural, factual and legal issues to be resolved that could significantly affect our belief as to the possibility of liability, we currently believe that it is reasonably possible that we could incur liability in connection with certain of these lawsuits. The foregoing determination was made in accordance with generally accepted accounting principles, as codified in Accounting Standards Codification (“ASC”) 450-20, and is not an admission of any liability on the part of us or any of our affiliates. Given that these cases are in the early stages and in light of the uncertainties surrounding them, we do not currently possess sufficient information to determine a range of reasonably possible liability. In the event we incur any liability, we believe it is unlikely we would incur losses in connection with these claims in excess of our insurance coverage. In addition, our general liability insurance coverage provides, as part of the contractual “duty to defend”, payment of legal fees and associated costs incurred to defend covered lawsuits that are filed arising from the October 1, 2017 shooting in Las Vegas. Payment of such fees and costs is in addition to (and not limited by) the limits of the insurance policies and does not erode the total liability coverage available. The insurance carriers have not expressed any reservation of rights or coverage defenses that indicate they dispute coverage under the applicable policies.

accompanying consolidated financial statements.


Other. We and our subsidiaries are also defendants in various other lawsuits, most of which relate to routine matters incidental to our business. We do not believe that the outcome of such pending litigation, considered in the aggregate, will have a material adverse effect on the Company.

ITEM 4.

MINE SAFETY DISCLOSURES

ITEM 4.    MINE SAFETY DISCLOSURES

Not applicable.



34

PART II

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES


ITEM 5.    MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Common Stock Information


Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “MGM.” The following table sets forth, for the calendar quarters indicated, the intra-day high and low sale prices per share of our common stock on the NYSE Composite Tape.  

 

 

2017

 

 

2016

 

 

 

High

 

 

Low

 

 

High

 

 

Low

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

First quarter

 

$

29.97

 

 

$

25.15

 

 

$

22.97

 

 

$

16.18

 

Second quarter

 

 

34.34

 

 

 

27.01

 

 

 

25.29

 

 

 

20.59

 

Third quarter

 

 

34.65

 

 

 

30.04

 

 

 

26.49

 

 

 

22.33

 

Fourth quarter

 

 

34.51

 

 

 

29.53

 

 

 

30.62

 

 

 

25.25

 


There were approximately 3,7203,294 record holders of our common stock as of February 23, 2018.

2022.


Dividend Policy

The Company implemented a dividend program in February 2017.2017 pursuant to which it has paid regular quarterly dividends. In March, June and September 2017,the second quarter of 2020 the Company paid quarterly dividends of $0.11reduced its annual dividend to $0.01 per share each totaling $63 million. In December 2017,in light of the impact of the COVID-19 pandemic on its operations at that time. The Company paid a quarterlyhas maintained an annual dividend of $0.11$0.01 per share totaling $62 million. On February 19, 2018 the Company’s Board of Directors approved a quarterly dividend to holders of record on March 9, 2018 of $0.12 per share, totaling $68 million, which will be paid on March 15, 2018.

throughout 2021. The amount, declaration and payment of any future dividends will be subject to the discretion of our Board of Directors who will evaluate our dividend policy from time to time based on factors it deems relevant, and the contractual limitations described below. In addition, as a holding company with no independent operations, our ability to pay dividends will depend upon the receipt of cash from our operating subsidiaries to generate the funds from operations necessary to pay dividends on our common stock. Furthermore, our senior credit facility contains financial covenants and restrictive covenants that could restrict our ability to pay dividends, subject to certain exceptions. In addition, the Operating Partnership and MGM China credit facilities each contain limitations on the ability of the applicable subsidiary under each credit agreement to pay dividends to us. There can be no assurance that we will continue to pay dividends in the future.


ITEM 6.

SELECTED FINANCIAL DATA


Purchases of Equity Securities by the Issuer

The following reflects selected historical financial data that shouldtable provides information about share repurchases made by the Company of its common stock during the quarter ended December 31, 2021:

PeriodTotal Number of Shares PurchasedAverage Price Paid per ShareTotal Number of Shares Purchased as Part of a Publicly Announced Program
Dollar Value of Shares that May Yet be Purchased Under the Program
(In thousands)
October 1, 2021 — October 31, 20211,800,000 $44.51 1,800,000 $1,897,460 
November 1, 2021 — November 30, 20213,747,997 $43.71 3,747,997 $1,733,626 
December 1, 2021 — December 31, 202111,598,650 $41.67 11,598,650 $1,250,266 

In February 2020, upon substantial completion of the May 2018 $2.0 billion stock repurchase program, the Company’s Board of Directors authorized a $3.0 billion stock repurchase program. Under the stock repurchase program, the Company may repurchase shares from time to time in the open market or in privately negotiated agreements. Repurchases of common stock may also be read in conjunctionmade under a Rule 10b5-1 plan, which would permit common stock to be purchased when the Company might otherwise be precluded from doing so under insider trading laws. The timing, volume and nature of stock repurchases will be at the sole discretion of management, dependent on market conditions, applicable securities laws, and other factors, and may be suspended or discontinued at any time. All shares repurchased by the Company during the quarter ended December 31, 2021 were purchased pursuant to the Company’s publicly announced stock repurchase programs and have been retired.

35

PERFORMANCE GRAPH

The graph below matches our cumulative 5-year total shareholder return on common stock with “Item 7 – Management’s Discussion and Analysisthe cumulative total returns of Financial Condition and Results of Operations”the Dow Jones US Total Return index, the S&P 500 index and the consolidatedDow Jones US Gambling index. The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends as required by the SEC) from December 31, 2016 to December 31, 2021. The return shown on the graph is not necessarily indicative of future performance.

The following performance graph shall not be deemed to be "filed" for purposes of Section 18 of the Exchange Act, nor shall this information be incorporated by reference into any future filing under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate it by reference into a filing.
mgm-20211231_g1.jpg

12/1612/1712/1812/1912/2012/21
MGM Resorts International100.00 117.48 86.75 121.19 115.78 164.94 
Dow Jones US Total Return100.00 121.50 115.45 151.41 182.30 230.61 
S&P 500100.00 121.83 116.49 153.17 181.35 233.41 
Dow Jones US Gambling100.00 140.14 97.24 143.49 128.65 112.16 
The stock price performance included in this graph is not necessarily indicative of future stock price performance.

36

ITEM 6.    RESERVED


ITEM 7.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This management’s discussion and analysis of financial statementscondition and notes thereto included elsewhereresults of operations includes discussion as of and for the year ended December 31, 2021 compared to December 31, 2020. Discussion of our financial condition and results of operations as of and for the year ended December 31, 2020 compared to December 31, 2019 can be found in thisour Annual Report on Form 10-K. The historical results are not necessarily indicative of10-K for the results of operations to be expected in the future.

 

 

2017

 

 

2016

 

 

2015

 

 

2014

 

 

2013

 

 

 

(In thousands, except per share data)

 

Net revenues

 

$

10,773,904

 

 

$

9,455,123

 

 

$

9,190,068

 

 

$

10,081,984

 

 

$

9,809,663

 

Operating income (loss)

 

 

1,715,492

 

 

 

2,079,787

 

 

 

(156,232

)

 

 

1,323,538

 

 

 

1,137,281

 

Net income (loss)

 

 

2,096,418

 

 

 

1,236,878

 

 

 

(1,039,649

)

 

 

127,178

 

 

 

41,374

 

Net income (loss) attributable to MGM Resorts

   International

 

 

1,960,286

 

 

 

1,101,440

 

 

 

(447,720

)

 

 

(149,873

)

 

 

(171,734

)

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share

 

$

3.39

 

 

$

1.94

 

 

$

(0.82

)

 

$

(0.31

)

 

$

(0.35

)

Weighted average common shares

 

 

572,253

 

 

 

568,134

 

 

 

542,873

 

 

 

490,875

 

 

 

489,661

 

Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share

 

$

3.35

 

 

$

1.92

 

 

$

(0.82

)

 

$

(0.31

)

 

$

(0.35

)

Weighted average common shares

 

 

578,795

 

 

 

573,317

 

 

 

542,873

 

 

 

490,875

 

 

 

489,661

 

Dividends declared per common share

 

$

0.44

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

At-year end:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

29,159,178

 

 

$

28,173,301

 

 

$

25,215,178

 

 

$

26,593,914

 

 

$

25,961,843

 

Total debt, including capital leases

 

 

12,922,712

 

 

 

13,000,792

 

 

 

12,713,416

 

 

 

14,063,563

 

 

 

13,326,441

 

Stockholders' equity

 

 

11,646,715

 

 

 

9,969,312

 

 

 

7,764,427

 

 

 

7,628,274

 

 

 

7,860,495

 

MGM Resorts International stockholders' equity

 

 

7,612,652

 

 

 

6,220,180

 

 

 

5,119,927

 

 

 

4,090,917

 

 

 

4,216,051

 

MGM Resorts International stockholders' equity per share

 

$

13.44

 

 

$

10.83

 

 

$

9.06

 

 

$

8.33

 

 

$

8.60

 

Number of shares outstanding

 

 

566,276

 

 

 

574,124

 

 

 

564,839

 

 

 

491,292

 

 

 

490,361

 

The following events/transactions affect the year-to-year comparability of the selected financial data presented above:

Acquisitions, Dispositions, and MGP IPO

In 2016, we recorded a $401 million gain for our share of CityCenter’s gain on the sale of the Shops at Crystals (“Crystals”). The gain included $200 million representing our share of the gain recorded by CityCenter and $201 million representing the reversal of certain basis differences. The basis differences primarily related to other-than-temporary impairment charges recorded on our investment in CityCenter that were allocated to Crystals’ building assets.

In 2016, we received proceeds of $1.2 billion and paid $75 million in issuance costs in connection with MGP’s IPO. See Note 1 to the accompanying consolidated financial statements for additional information.

In 2016, we recorded a gain of $430 million on the acquisition of Boyd Gaming’s ownership interest in Borgata. Upon acquisition of Borgata on August 1, 2016, we began consolidating the results of Borgata and ceased recording of Borgata’s results as an equity method investment.

In 2016, we opened MGM National Harbor, an integrated casino, hotel and entertainment resort in Prince George’s County at National Harbor, which is a waterfront development located on the Potomac River just outside of Washington, D.C.

Other

In 2013, we recorded non-cash impairment charges of $37 million related to our investment in Grand Victoria, $20 million related to our land in Jean and Sloan, Nevada, and $45 million related to corporate buildings expected to be removed from service.

In 2013, we recorded a $70 million loss for our share of CityCenter’s non-operating loss on retirement of long-term debt, primarily consisting of premiums associatedfiscal year ended December 31, 2020, filed with the redemption of the existing firstSecurities and second lien notes as well as the write-off of previously unamortized debt issuance costs and a gain of $12 million related to our share of Silver Legacy’s non-operating gainExchange Commission (“SEC”) on retirement of long-term debt.

February 26, 2021.

In 2014, we recorded a non-cash impairment charge of $29 million related to our investment in Grand Victoria.



•

In 2015, we recorded non-cash impairment charges of $1.5 billion to reduce the historical carrying value of goodwill related to the MGM China reporting unit and $17 million related to our investment in Grand Victoria.

In 2015, we recorded an $80 million gain for our share of CityCenter’s gain resulting from the final resolution of its construction litigation and related settlements.

In 2015, we recorded a gain of $23 million related to the sale of Circus Circus Reno and our 50% interest in Silver Legacy and associated real property.

In 2016, we recorded a $22 million loss related to our redemption of outstanding 7.50% senior notes due 2016 and 10% senior notes due 2016, and a $16 million loss on the early retirement of debt related to outstanding 7.625% senior notes due 2017.

In 2016, we recorded a $28 million loss on debt retirement in connection with the amendment and restatementDescription of our senior credit facility.

business and key performance indicators

In 2016, we recorded a $152 million expense related to our strategic decision to exit the fully bundled sales system of NV Energy, which included $13 million related to our share of CityCenter’s portion of the payment. In 2017, we then recorded a gain of $45 million related to the NV Energy exit fee modification.


In 2017, we recorded a $30 million loss on the early retirement of debt related to outstanding 11.375% senior notes due 2018 and a $14 million loss on the early retirement of debt related to the MGM National Harbor credit facility.

In 2017, we recorded a gain of $36 million related to the Borgata property tax settlement.

In 2017, we recorded a $1.4 billion tax benefit related to the enactment of the U.S. Tax Cuts and Jobs Act (“Tax Act”).


ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Executive Overview

Our primary business is the ownership and operation of casino resorts, which offer gaming, hotel, convention, dining, entertainment, retail and other resort amenities. We own or invest inoperate several of the finest casino resorts in the world and we continually reinvest in our resorts to maintain our competitive advantage. Most of our revenue is cash-based, through customers wagering with cash or paying for non-gaming services with cash or credit cards. We rely heavily on the ability of our resorts to generate operating cash flow to fund capital expenditures, provide excess cash flow for future development, and repay debt financings.financings, and return capital to our shareholders. We make significant investments in our resorts through newly remodeled hotel rooms, restaurants, entertainment and nightlife offerings, as well as other new features and amenities.

During the year ended December 31, 2017, Las Vegas visitor volume decreased 2%, Las Vegas Strip REVPAR increased 2% and Las Vegas Strip gaming revenue increased by 1% compared to the prior year period according to information published by the Las Vegas Convention and Visitors Authority. Results of operations for our domestic resorts during 2017 benefited from an increase in operating margins resulting from increases in gaming revenue and REVPAR, discussed below. Our rooms revenue benefited from robust convention business at our Las Vegas Strip resorts, which allowed us to yield higher room rates across our portfolio of resorts.

Gross gaming revenue in the Macau market increased 19% in 2017 compared to 2016, primarily as a result of growth on the Cotai Strip. Additionally, according to statistics published by the Statistics and Census Service of the Macau Government, visitor arrivals increased 5% and overnight visitors increased 10% in 2017 compared to 2016. As a significant number of MGM Macau’s customers are from mainland China, we believe operating results at MGM Macau are affected by economic conditions in mainland China as well as certain policy initiatives enacted in mainland China and Macau. We believe a slowdown in China’s economic growth rate as well as the implementation of policies related to gaming promoters, the Chinese government’s restrictions on travel to Macau and cross-border currency transactions led to a multi-year decrease in gross gaming revenues for the Macau market, which lasted through the first half of 2016 and primarily impacted VIP casino gaming operations and, to a lesser extent, main floor operations throughout the Macau market. Despite the impact of these events and concerns over the sustainability of economic growth in China, we expect the Macau market to grow on a long-term basis due to further development and penetration of the mainland China market and infrastructure improvements expected to facilitate more convenient travel to and within Macau. We believe recent trends reflect stabilization and growth within the Macau market as gross gaming revenue has increased year over year in each month beginning in August 2016 and continuing through December 2017.


Our results of operations are affected by decisions we make related to our capital allocation, our access to capital and our cost of capital. While we continue to be focused on improving our financial position and returning capital to shareholders, we are also dedicated to capitalizing on strategic development opportunities. For instance,or initiatives.

Our results of operations do not tend to be seasonal in nature, though a variety of factors may affect the results of any interim period, including the timing of major conventions, Far East baccarat volumes, the amount and timing of marketing and special events for our high-end gaming customers, and the level of play during major holidays, including New Year and Lunar New Year. While our results do not depend on key individual customers, a significant portion of our operating income is generated from high-end gaming customers, which can cause variability in our results. In addition, our success in marketing to customer groups such as convention customers and the financial health of customer segments such as business travelers or high-end gaming customers from a specific country or region can affect our results.

Financial Impact of COVID-19

The spread of COVID-19 and developments surrounding the global pandemic have had a significant impact on our business, financial condition, results of operations and cash flows in 2020 and 2021 and may continue to impact our business in 2022 and thereafter. In March 2020, all of our domestic properties were temporarily closed pursuant to state and local government restrictions imposed as a result of COVID-19. Throughout the second and third quarters of 2020, all of our properties that were temporarily closed re-opened to the public, with temporary re-closures and re-openings occurring for certain of our properties or portions thereof into the first quarter of 2021. Upon re-opening, the properties continued to operate without certain amenities and subject to certain occupancy limitations, with restrictions varying by jurisdiction. Beginning in the latter part of the first quarter of 2021 and continuing into the second quarter of 2021, our domestic jurisdictions eased and removed prior operating restrictions, including capacity and occupancy limits, as well as social distancing policies.

Although all of our properties have re-opened, in light of the unpredictable nature of the pandemic, including the emergence and spread of COVID-19 variants, the properties may be subject to new operating restrictions and/or temporary, complete, or partial shutdowns in the future. At this time, we opened MGM Cotaicannot predict whether jurisdictions, states or the federal government will adopt similar or more restrictive measures in the future than in the past, including stay-at-home orders or the temporary closure of all or a portion of our properties as a result of the pandemic.

In Macau, following a temporary closure of our properties on February 13, 2018. MGM Cotai5, 2020, operations resumed on February 20, 2020, subject to certain health safeguards, such as limiting the number of seats available at each table game, slot machine spacing, reduced operating hours at a number of restaurants and bars, temperature checks, and mask protection. Although the issuance of tourist visas (including the individual visit scheme) for residents of Zhuhai, Guangdong Province and all other provinces in mainland China to travel to Macau resumed on August 12, 2020, August 26, 2020 and September 23, 2020, respectively, several travel and entry restrictions in Macau, Hong Kong and mainland China remain in place (including the temporary suspension of ferry services between Hong Kong and Macau, the negative nucleic acid test result certificate, and mandatory quarantine requirements for returning residents, for visitors from Hong Kong, Taiwan, and
37

mainland China, and bans on entry on other visitors), which significantly impacted visitation to our Macau properties. In the third and fourth quarters of 2021, local COVID-19 cases were identified in Macau. Upon such occurrences, a state of immediate prevention was declared and mass mandatory nucleic acid testing was imposed in Macau, the validity period of negative test results for re-entry into mainland China was shortened and quarantine requirements were imposed, certain events were cancelled or suspended, and in some instances, certain entertainment and leisure facilities were closed throughout Macau. Although gaming and hotel operations have remained open during these states of immediate prevention, such measures have had a negative effect on our operations and it is an integrated casino, hoteluncertain whether further closures, including the closure of our properties, or travel restrictions to Macau will be implemented if additional local COVID-19 cases are identified.

The Las Vegas Strip segment results of operations are heavily impacted by visitor volume and trends. During the year ended December 31, 2021, Las Vegas visitor volume increased 69% compared to the prior year period according to information published by the Las Vegas Convention and Visitors Authority. The Las Vegas market has had the addition of new sporting events and venues, the expansion of convention centers, as well as music and entertainment resort located on an 18 acre site onevents, which have positively impacted visitation, along with the Cotai Stripeasing of COVID-19 related restrictions, as discussed above.

The MGM China segment results of operations also are heavily impacted by visitor volume and trends. During the year ended December 31, 2021, Macau visitor arrivals increased 31% compared to the prior year period according to statistics published by the Statistics and Census Service of the Macau Government, as the prior year period was more negatively affected by travel and entry restrictions in Macau. The Gaming Inspection and Coordination Bureau of Macau (“DICJ”) approved 100 gaming tables for the opening of MGM Cotai and 25 additional gaming tables effective for operation on January 1, 2019, for a total of 125 gaming tables in aggregate. In addition, the DICJ approved the initial transfer of 77 gaming tables from MGM Macau to MGM Cotai.

Additionally, we were awarded a casino license to build and operate MGM Springfield in Springfield, Massachusetts. MGM Springfield is being developed on approximately 14 acres of land in downtown Springfield. MGM’s plans for the resort currently include a casino with approximately 2,550 slots and 120 table games including poker; a 250-room hotel; 100,000 square feet of retail and restaurant space; 44,000 square feet of meeting and event space; and a 3,500 space parking garage; with an expected development and construction cost of approximately $960 million, excluding capitalized interest and land-related costs. Construction of MGM Springfield is expected to be completedthan in the third quarter of 2018.

In August 2015, we announced the implementation ofcurrent year period.


For a Profit Growth Plan for sustained growth and margin enhancement. The Profit Growth Plan’s initiatives focused on improving business processes to leverage our scale for greater efficiency and lower costs, and to identify areas of opportunity to organically drive incremental revenue growth. The Profit Growth Plan included a large number of initiatives to optimize operations and in 2017 we transitioned from the Profit Growth Plan to a continuous improvement approach to explore additional opportunities to drive further improvement.

Formation and Initial Public Offering of MGP

On April 25, 2016, MGM Growth Properties LLC (“MGP”), a consolidated subsidiary, completed its initial public offering (“IPO”). MGP is organized as an umbrella partnership REIT (commonly referred to as an “UPREIT”) structure in which substantially all of its assets are owned by, and substantially all of its businesses are conducted through the Operating Partnership. MGP has two classes of authorized and outstanding voting common shares (collectively, the “shares”): Class A shares and a single Class B share.


We own MGP’s Class B share, which does not provide its holder any rights to profits or losses or any rights to receive distributions from operations of MGP or upon liquidation or winding up of MGP. MGP’s Class A shareholders are entitled to one vote per share, while we, as the ownerdiscussion of the Class B share, are entitledrisks to an amountour business resulting from COVID-19, please see “Item 1A. Risk Factors — Risks Related to Our Business, Industry, and Market Conditions.”


Other Developments

As of votes representing a majority of the total voting power of MGP’s shares so long as our and our controlled affiliates’ (excluding MGP’s) aggregate beneficial ownership of the combined economic interests in MGP and the Operating Partnership does not fall below 30%. The sole general partner of the Operating Partnership is also a subsidiary of MGP.

In connection with the formation of MGP, MGP used the proceeds from the IPO to purchase operating partnership units in the Operating Partnership. Concurrently,December 31, 2021, we contributedlease the real estate assets associated withof The Mirage, Mandalay Bay, Luxor, New York-New York, Monte Carlo,Park MGM, Excalibur, The Park, Gold Strike Tunica, MGM Grand Detroit, and Beau Rivage, to the Operating Partnership in exchange for operating partnership units. A wholly owned subsidiary of the Operating Partnership (the “landlord”) subsequently leased the properties to a subsidiary of ours (the “tenant”)Borgata, Empire City, MGM National Harbor, MGM Northfield Park, and MGM Springfield pursuant to a long-term triple-net master lease agreement (the “master lease”).  

In August 2016, we completed the acquisition of Boyd Gaming Corporation’s (“Boyd Gaming”) ownership interest in Borgata, at which time Borgata became a consolidated subsidiary of ours. Subsequently, MGP acquired Borgata’s real property from us, and in October 2017, MGP also acquired the long-term leasehold interest and real property associated with MGM National Harbor from us. Amendments to the master lease agreement provided that we then lease the real estate assets of Borgata and MGM National Harbor from a subsidiary of the Operating Partnership. As of December 31, 2017, we owned 73.4% of the Operating Partnership units, and MGP held the remaining 26.6% ownership interest in the Operating Partnership.

MGP. See Note 1 in the accompanying consolidated financial statements for information regarding MGP and its subsidiaries,the Operating Partnership, which we consolidate in our financial statements, and from which we lease certain of our real estate assets pursuant to a master lease agreement.statements. All intercompany transactions, including transactions under the master lease with MGP, have been eliminated in consolidation.

Reportable Segments

We have two reportable segments: domestic resorts


As further discussed below, we lease the real estate assets of Bellagio pursuant to a lease agreement with Bellagio BREIT Venture, the real estate assets of Mandalay Bay and MGM China.Grand Las Vegas pursuant to a lease agreement with MGP BREIT Venture, and the real estate assets of Aria (including Vdara) pursuant to a lease agreement with a fund managed by Blackstone, as further discussed below.

In April 2019, we acquired the membership interests of Northfield Park Associates, LLC (“Northfield”), an Ohio limited liability company that owned the real estate assets and operations of the Hard Rock Rocksino Northfield Park, from MGP and MGP retained the real estate assets. We currently ownthen rebranded the property to MGM Northfield Park, and operate 14 resortsadded it to the master lease between us and MGP. See Note 18 in the United States.accompanying financial statements for information regarding this acquisition.

Also, in January 2019, we acquired the real property and operations associated with Empire City in Yonkers, New York for consideration of approximately $865 million. Subsequently, MGP acquired the developed real property associated with Empire City from us and Empire City was added to the master lease between us and MGP. In addition, pursuant to the master lease amendment, we agreed to provide MGP a right of first offer with respect to certain undeveloped land adjacent to the property to the extent that we develop additional gaming facilities and choose to sell or transfer such property in the future. See Note 4 and Note 18 in the accompanying consolidated financial statements for information regarding this acquisition.

In March 2019, we entered into an amendment to the master lease between us and MGP with respect to improvements made by us related to the rebranding of the Park MGM China’s operations consistand NoMad Las Vegas. See Note 18 in the accompanying financial statements for information regarding this transaction with MGP, which is eliminated in consolidation.

In November 2019, we completed the Bellagio transaction, pursuant to which Bellagio BREIT Venture was formed, which acquired the Bellagio real estate assets from us and entered into a lease agreement to lease the real estate assets back to us. The Bellagio lease has an initial term of 30 years with two 10-year renewal periods, exercisable at our option. The initial term of the lease provides for an initial annual rent of $245 million with a fixed 2% escalator for the first 10 years
38

and, thereafter, an escalator equal to the greater of 2% and the CPI increase during the prior year, subject to a cap of 3% during the 11th through 20th years and 4% thereafter. In addition, the lease obligates us to spend a specified percentage of net revenues at the property on capital expenditures and that we comply with certain financial covenants, which, if not met, would require us to maintain cash security or provide one or more letters of credit in favor of the landlord in an amount equal to rent for the succeeding 2-year period. In exchange for the contribution of the real estate assets, we received total consideration of $4.25 billion, which consisted of a 5% equity interest in the venture and cash of approximately $4.2 billion. We also provide a shortfall guarantee of the principal amount of indebtedness of Bellagio BREIT Venture (and any interest accrued and unpaid thereon). As a result of the sale, we recorded a gain of approximately $2.7 billion. See Note 1, Note 11, and Note 12 in the accompanying consolidated financial statements for information regarding this transaction, lease agreement, and shortfall guarantee, respectively.

In December 2019, we sold Circus Circus Las Vegas and adjacent land for $825 million, which consisted of $663 million paid in cash and a secured note due 2024 with a face value of $163 million and fair value of $134 million. In connection with our review of the carrying value of assets to be sold due to the offer for sale received during the third quarter of 2019, we recorded a non-cash impairment charge of $219 million. Upon completion of the sale in the fourth quarter, we recorded a loss of $2 million. See Note 1 and Note 16 in the accompanying consolidated financial statements for information regarding this transaction.

In February 2020, we completed the MGP BREIT Venture Transaction pursuant to which the real estate assets of MGM Macau resortGrand Las Vegas and Mandalay Bay (including Mandalay Place) were contributed to MGP BREIT Venture, owned 50.1% by the Operating Partnership and 49.9% by a subsidiary of BREIT. In exchange for the contribution of the real estate assets, MGM and MGP received total consideration of $4.6 billion, which was comprised of $2.5 billion of cash, $1.3 billion of the Operating Partnership’s secured indebtedness assumed by MGP BREIT Venture, and the Operating Partnership’s 50.1% equity interest in MGP BREIT Venture. In addition, the Operating Partnership issued approximately 3 million Operating Partnership units to us representing 5% of the equity value of MGP BREIT Venture. We also provide a shortfall guarantee of the principal amount of indebtedness of MGP BREIT Venture (and any interest accrued and unpaid thereon). On the closing date, BREIT also purchased approximately 5 million MGP Class A shares for $150 million. See Note 1, Note 11, and Note 12 in the accompanying consolidated financial statements for information regarding this transaction, lease agreement, and shortfall guarantee, respectively.

In connection with the MGP BREIT Venture Transaction, MGP BREIT Venture entered into a lease with us for the real estate assets of Mandalay Bay and MGM CotaiGrand Las Vegas. The lease has an initial term of 30 years with two 10-year renewal periods, exercisable at our option. The initial term of the lease provides for an initial annual rent of $292 million with a fixed 2% escalator for the first 15 years and, thereafter, an escalator equal to the greater of 2% and the CPI increase during the prior year, subject to a cap of 3%. In addition, the lease obligates us to spend a specified percentage of net revenues at the properties on capital expenditures and that we comply with certain financial covenants, which, if not met, would require us to maintain cash security or provide one or more letters of credit in favor of the landlord in an amount equal to the rent for the succeeding 1-year period. See Note 11 in the accompanying financial statements for information regarding this lease agreement.

In connection with the MGP BREIT Venture Transaction, the master lease with MGP was modified to remove the Mandalay Bay property and the annual cash rent under the MGP master lease was reduced by $133 million, as further discussed in Note 18.

Also, in January 2020, we, the Operating Partnership, and MGP entered into an agreement for the Operating Partnership to waive its right following the closing of the MGP BREIT Venture Transaction to issue MGP Class A shares, in lieu of cash, to us in connection with us exercising our right to require the Operating Partnership to redeem the Operating Partnership units we hold, at a price per unit equal to a 3% discount to the ten day average closing price prior to the date of the notice of redemption. The waiver was effective upon closing of the transaction on February 14, 2020 and was scheduled to terminate on the Cotai Stripearlier of February 14, 2022 or upon our receipt of cash proceeds of $1.4 billion as consideration for the redemption of our Operating Partnership units. On May 18, 2020 the Operating Partnership redeemed approximately 30 million Operating Partnership units that we held for $700 million, or $23.10 per unit, and on December 2, 2020, the Operating Partnership redeemed approximately 24 million Operating Partnership units that we held for the remaining $700 million, or $29.78 per unit. As a result, the waiver terminated in Macau. Weaccordance with its terms.

In March 2021, we delivered a notice of redemption to MGP covering approximately 37 million Operating Partnership units that we held which was satisfied with aggregate cash proceeds of approximately $1.2 billion, using cash on hand together with the proceeds from MGP's issuance of Class A shares. See Note 13 in the accompanying consolidated financial statements for information regarding this transaction, which eliminates in consolidation.

39

In August 2021, we entered into an agreement with VICI and MGP whereby VICI will acquire MGP. Pursuant to the agreement, MGP Class A shareholders will receive 1.366 shares of newly issued VICI stock in exchange for each MGP Class A share outstanding and we will receive 1.366 units of the new VICI OP in exchange for each Operating Partnership unit we hold. The fixed exchange ratio represents an agreed upon price of $43 per share of MGP Class A share to the five-day volume weighted average price of VICI stock as of the close of business on July 30, 2021. In connection with the exchange, VICI OP will redeem the majority of our VICI OP units for cash consideration of $4.4 billion, with us retaining an approximate $370 million ownership interest in the VICI OP (based upon the close price of VICI stock as of August 3, 2021). MGP’s Class B share that we hold will be cancelled. As part of the transaction, we will enter into an amended and restated master lease with VICI. The new master lease will have additional business activitiesan initial term of 25 years, with three 10-year renewals, and initial annual rent of $860 million, escalating annually at a rate of 2% per annum for the first 10 years and thereafter equal to the greater of 2% and the CPI increase during the prior year subject to a cap of 3%. The transaction is expected to close in the first half of 2022, subject to customary closing conditions, regulatory approvals, and approval by VICI stockholders (which was obtained on October 29, 2021). See “Item 1A. Risk Factors — Risks Related to Our Announced Transactions — The VICI Transaction, The Cosmopolitan transaction, and The Mirage transaction each remain subject to the satisfaction of certain closing conditions, including investmentsthe receipt of certain regulatory approvals, and any anticipated benefits from such transactions may take longer to realize than expected or may not be realized at all.”

In September 2021, we entered into an agreement to acquire the operations of The Cosmopolitan for cash consideration of $1.625 billion, subject to customary working capital adjustments. Additionally, we will enter into a lease agreement for the real estate assets of The Cosmopolitan. The Cosmopolitan lease will have an initial term of 30 years with three subsequent 10-year renewal periods, exercisable at our option. The initial term of the lease provides for an initial annual cash rent of $200 million with a fixed 2% escalator for the first 15 years, and thereafter, an escalator equal to the greater of 2% and the CPI increase during the prior year, subject to a cap of 3%. Additionally, the lease will require us to spend a specified percentage of net revenues over a rolling 5-year period at the property on capital expenditures and for us to comply with certain financial covenants, which, if not met, would require us to maintain cash security or one or more letters of credit in unconsolidated affiliates,favor of the landlord in an amount equal to rent for the succeeding 1-year period. The transaction is expected to close in the first half of 2022, subject to regulatory approvals and certain other corporatecustomary closing conditions.

In September 2021, we completed the acquisition of the 50% ownership interest in CityCenter held by Infinity World for cash consideration of $2.125 billion. Upon the closing of the transaction, we own 100% of CityCenter and management operations.accordingly no longer account for our interest under the equity method of accounting, and we now consolidate CityCenter isin our most significant unconsolidated affiliate,financial statements. See Note 4 in the accompanying consolidated financial statements for information regarding this transaction.

In September 2021, we sold the real estate assets of Aria (including Vdara) for cash consideration of $3.89 billion and entered into a lease pursuant to which we also managelease back the real property. The lease has an initial term of 30 years with three 10-year renewal periods, exercisable at our option. The initial term of the lease provides for an initial annual rent of $215 million with a fee. Our operationsfixed 2% escalator for the first 15 years and, thereafter, an escalator equal to the greater of 2% and the CPI increase during the prior year, subject to a cap of 3%. In addition, the lease obligates us to spend a specified percentage of net revenues at the properties on capital expenditures and that arewe comply with certain financial covenants, which, if not segregated into separate reportable segments are reported as “corporatemet, would require us to maintain cash security or provide a letter of credit in favor of the landlord in an amount equal to the rent for the succeeding 1-year period. See Note 11 in the accompanying consolidated financial statements for information regarding this lease.

In October 2021, MGP acquired the real estate assets of MGM Springfield from us and other” operationsMGM Springfield was added to the MGP master lease between us and MGP through which we lease back the real property. Transactions with MGP, including transactions under the MGP master lease, have been eliminated in our reconciliationsconsolidation of segment resultsMGP. Refer to consolidated results.

Domestic resorts. At December 31, 2017, our domestic resorts consistedNote 18 for further discussion of the following casino resorts:

master lease with MGP.

Las Vegas, Nevada:

Bellagio, MGM Grand Las Vegas (including The Signature), Mandalay Bay (including Delano and Four Seasons), The Mirage, Luxor, New York-New York (including the Park), Excalibur, Monte Carlo and Circus Circus Las Vegas.

Other:

MGM Grand Detroit in Detroit, Michigan; Beau Rivage in Biloxi, Mississippi; Gold Strike Tunica in Tunica, Mississippi; Borgata in Atlantic City, New Jersey; and MGM National Harbor in Prince George’s County, Maryland.


Over

In December 2021, we entered into an agreement to sell the operations of The Mirage to an affiliate of Hard Rock for cash consideration of $1.075 billion, subject to certain purchase price adjustments. Pursuant to the agreement, Hard Rock is obligated to use its reasonable best efforts to obtain the requisite antitrust and gaming regulatory approvals. The agreement may be terminated by either party if the closing has not occurred on or before December 13, 2022, which date may be extended by either party to March 13, 2023 under certain circumstances. The agreement contemplates a reverse termination fee of $322.5 million that is payable by Hard Rock to us in the event that the parties are unable to obtain antitrust or gaming regulatory approval. Upon closing, the master lease between us and VICI (or MGP in the event that the VICI Transaction is terminated) will be amended and restated to reflect a $90 million reduction in annual cash rent. The transaction is expected to close during the second half of the net revenue from our domestic resorts is derived from non-gaming operations including hotel, food and beverage, entertainment and other non-gaming amenities. We market to different customer groups and utilize our significant convention and meeting facilities to maximize hotel occupancy and customer volumes which also leads to better labor utilization. Our operating results are highly dependent on demand for our services, and the volume of customers at our resorts, which in turn affects the price we can charge for our hotel rooms and other amenities. Also, we generate a significant portion of our revenue from our domestic resorts in Las Vegas, Nevada, which exposes us2022, subject to certain risks, such as increased competition from newclosing conditions, including, but not limited to, the consummation or expanded Las Vegas resorts,termination of the VICI Transaction and from the expansionreceipt of gaming in the United States generally.

regulatory approvals.


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Key Performance Indicators

Key performance indicators related to gaming and hotel revenue at our domestic resorts are:


•Gaming revenue indicators: table games drop and slots handle (volume indicators); “win” or “hold” percentage, which is not fully controllable by us. Our normal table games hold percentage at our Las Vegas Strip Resorts is in the range of 20%25.0% to 23%35.0% of table games drop for Baccarat and 19.0% to 23.0% for non-Baccarat; however, reduced gaming volumes as a result of the COVID-19 pandemic could cause volatility in our normal slots hold percentage is in the range of 8.5% to 9% of slots handle;percentages; and



•

•Hotel revenue indicators: hotel occupancy (a volume indicator); average daily rate (“ADR,” a price indicator); and revenue per available room (“REVPAR,” a summary measure of hotel results, combining ADR and occupancy rate). Our calculation of ADR, which is the average price of occupied rooms per day, includes the impact of complimentary rooms. Complimentary room rates are determined based on an analysis of retail or “cash” rates for each customer segment and each type of room product to estimate complimentary rates which are consistent with retail rates. Complimentary rates are reviewed at least annually and on an interim basis if there are significant changes in market conditions. Because the mix of rooms provided on a complimentary basis, particularly to casino customers, includes a disproportionate suite component, the composite ADR including complimentary rooms is slightly higher than the ADR for cash rooms, reflecting the higher retail value of suites.

MGM China. We own an approximate 56% controlling interest in MGM China, which owns MGM Grand Paradise, the Macau company that owns and operates MGM Macau and MGM Cotai, the related gaming subconcession and land concessions. We believe our investment in MGM China plays an important role in extending our reach internationally and will foster future growth and profitability.

Revenues at MGM Macau are generated from three primary customer segments in the Macau gaming market: VIP casino gaming operations, main floor gaming operations, and slot machine operations. VIP players play mostly in dedicated VIP rooms or designated gaming areas. VIP customers can be further divided into customers sourced by in-house VIP programs and those sourced through gaming promoters. A significant portion of our VIP volume is generated through the use of gaming promoters. Gaming promoters introduce VIP gaming players to MGM Macau, assist these customers with travel arrangements, and extend gaming credit to these players. In exchange for their services, gaming promoters are compensated through payment of revenue-sharing arrangements or rolling chip turnover based commissions. In-house VIP players also typically receive a commission based on standalone selling price. Because the program in which they participate. MGM Macau main floor operations primarily consistmix of walk-inrooms provided on a complimentary basis, particularly to casino customers, includes a disproportionate suite component, the composite ADR including complimentary rooms is slightly higher than the ADR for cash rooms, reflecting the higher retail value of suites. Rooms that were out of service during the years ended December 31, 2021 and day trip visitors. Unlike gaming promoters and in-house VIP players, main floor players do not receive commissions. The profit contribution2020 as a result of closures due to the COVID-19 pandemic were excluded from the main floor segment exceeds the VIP segment due to commission costs paid to gaming promoters. Gaming revenues from the main floor segment have become an increasingly significant portion of total gaming revenues in recent yearsavailable room count when calculating hotel occupancy and we believe this segment represents the most potential for sustainable growth in the future.

VIP gaming at MGM Macau is conducted by the use of special purpose nonnegotiable gaming chips. Gaming promoters purchase these nonnegotiable chips from MGM Macau and in turn they sell these chips to their players. The nonnegotiable chips allow MGM Macau to track the amount of wagering conducted by each gaming promoters’ clients in order to determine VIP gaming play. Gaming promoter commissions are based on a percentage of the gross table games win or a percentage of the table games turnover they generate. They also receive a complimentary allowance based on a percentage of the table games turnover they generate, which can be applied to hotel rooms, food and beverage and other discretionary customers-related expenses. The estimated portion of the gaming promoter payments that represent amounts passed through to VIP customers is recorded as a reduction of casino revenue, and the estimated portion retained by the gaming promoter for its compensation is recorded as casino expense. In-house VIP commissions are based on a percentage of rolling chip turnover and are recorded as a reduction of casino revenue.

In addition to theREVPAR.


Additional key performance indicators used by our domestic resorts,at MGM MacauChina are:

•Gaming revenue indicators: MGM China utilizes “turnover,” which is the sum of nonnegotiable chip wagers won by MGM MacauChina calculated as nonnegotiable chips purchased plus nonnegotiable chips exchanged less nonnegotiable chips returned. Turnover provides a basis for measuring VIP casino win percentage. Win for VIP gaming operations at MGM MacauChina is typically in the range of 2.7%2.6% to 3.0%3.3% of turnover. Win for main floorturnover; however, reduced gaming operations at MGM Macau is typically in the range of 16-22% of table games drop.

Corporate and other. Corporate and other includes our investments in unconsolidated affiliates and certain management and other operations. See Note 1 and Note 7 to the accompanying consolidated financial statements for discussionvolumes as a result of the Company’s unconsolidated affiliates.

COVID-19 pandemic could cause volatility in MGM China’s hold percentages.


Results of Operations


The following discussion is based on our consolidated financial statements for the years ended December 31, 2017, 20162021, 2020 and 2015.

2019.


Summary FinancialOperating Results


The following table summarizes our operating results:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Net revenues

 

$

10,773,904

 

 

$

9,455,123

 

 

$

9,190,068

 

Operating income (loss)

 

 

1,715,492

 

 

 

2,079,787

 

 

 

(156,232

)

Net income (loss)

 

 

2,096,418

 

 

 

1,236,878

 

 

 

(1,039,649

)

Net income (loss) attributable to MGM Resorts International

 

 

1,960,286

 

 

 

1,101,440

 

 

 

(447,720

)


Summary Operating Results

 Year Ended December 31,
 202120202019
 (In thousands)
Net revenues$9,680,140 $5,162,082 $12,899,672 
Operating income (loss)2,278,699 (642,434)3,940,215
Net income (loss)1,208,389 (1,319,907)2,214,380
Net income (loss) attributable to MGM Resorts International1,254,370 (1,032,724)2,049,146

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Our domestic properties were temporarily closed due to COVID-19 on the dates shown below:

Las Vegas Strip Resorts(1)
Closure DateInitial Re-opening Date
BellagioMarch 17, 2020June 4, 2020
MGM Grand Las VegasMarch 17, 2020June 4, 2020
New York-New YorkMarch 17, 2020June 4, 2020
ExcaliburMarch 17, 2020June 11, 2020
LuxorMarch 17, 2020June 25, 2020
Mandalay Bay(2)
March 17, 2020July 1, 2020
The Mirage(3)
March 17, 2020August 27, 2020
Park MGM(2)
March 17, 2020September 30, 2020
Regional Operations
Gold Strike TunicaMarch 17, 2020May 25, 2020
Beau RivageMarch 17, 2020June 1, 2020
MGM Northfield ParkMarch 14, 2020June 20, 2020
MGM National HarborMarch 15, 2020June 29, 2020
MGM Springfield(4)
March 15, 2020July 13, 2020
BorgataMarch 16, 2020July 26, 2020
MGM Grand Detroit(5)
March 16, 2020August 7, 2020
Empire CityMarch 14, 2020September 21, 2020
(1)Aria was excluded from the table above, as it was not consolidated during 2020.
(2)Park MGM and Mandalay Bay’s hotel tower operations were closed midweek starting November 9, 2020 and November 30, 2020, respectively, and full week hotel tower operations resumed on March 3, 2021.
(3)The Mirage’s hotel tower operations were closed midweek beginning November 30, 2020. The entire property was closed midweek starting January 4, 2021, and re-opened on March 3, 2021.
(4)MGM Springfield’s hotel was re-closed beginning November 2, 2020, and partial hotel operations resumed with midweek closures on March 5, 2021. Full hotel operations resumed on December 13, 2021.
(5)MGM Grand Detroit re-closed on November 17, 2020 and re-opened on December 23, 2020, with the hotel tower operations resuming February 9, 2021.

Consolidated net revenues for 2017 increased 14%were $9.7 billion in 2021 compared to 2016 due primarily $5.2 billion in 2020, an increase of 88%. The current year benefited from the inclusion of the net revenues of Aria subsequent to consolidation in September 2021 and the full yearremoval of operationsmandated operational and capacity restrictions at Borgata and MGM National Harbor,our properties, as well as an increase in casino revenue, rooms revenue, valettravel, while the prior year was negatively affected by temporary property closures at certain of our Las Vegas Strip Resorts and parking fee revenueRegional Operations for a portion of the year due to the pandemic. At MGM China, the prior year was negatively affected by both property closures in the first quarter and was also more significantly impacted by travel and entry restrictions in Macau than in the current year. These factors resulted in a 111% increase in net revenues at our domestic resortsLas Vegas Strip Resorts, a 72% increase in net revenues at our Regional Operations, and an 84% increase in casino revenuenet revenues at MGM China. Consolidated net revenues for 2016 increased 3% compared to 2015 due primarily to the Borgata transaction on August 1, 2016, the opening of MGM National Harbor in December 2016 and an increase in casino revenue, rooms revenue, food and beverage revenue, and other revenue including parking fee revenue at our domestic resorts, partially offset by a decrease in casino revenue at MGM China. See “Operating Results – Detailed Segment Information” below for additional information related to segment revenues.

China.


Consolidated operating income was $1.7$2.3 billion in 2017for the year ended December 31, 2021 compared to $2.1 billiona loss of $642 million in 2016.2020, due primarily to the temporary property closures in the prior year as well as the inclusion of the operating income of Aria subsequent to consolidation in September 2021, as discussed above. The current year period included a fullgain on consolidation of CityCenter, net of $1.6 billion and the prior year of operations at Borgata, which included a benefit$1.5 billion gain on REIT transactions, net and $26 million in restructuring costs. In addition, corporate expense decreased $37 million compared to the prior year. Corporate expense in the current year included $34 million in transaction costs, while the prior year included $44 million of $36CEO transition expense and $49 million related to Borgata’s share of a property taxOctober 1 litigation settlement from Atlantic City, a full yearexpense. Included in the CEO transition expense is $20 million of operations at MGM National Harbor, and a benefitstock compensation expense, of $45which approximately $13 million related to the modification and accelerated vesting of outstanding stock compensation awards. Property transactions, net in the NV Energy exit fee, whichcurrent year included a gain of $29 million related to a reduction in the benefit recognized at our domestic resorts as well as our 50% shareestimate of contingent consideration related to the benefit recognized at CityCenter. TheEmpire City acquisition, a gain of $76 million relating to the sale of art, and an other-than-temporary impairment charge of $22 million related to an investment in an unconsolidated affiliate. Property transactions, net in the prior year included a $430$64 million gain recognizedother-than-temporary non-cash impairment charge on the Borgata acquisitionan equity method investment and a $401$17 million gain related to the sale of The Shops at Crystals (“Crystals”) at CityCenter, which was offset by charges of $152 million of NV Energy exita loss on production show costs. Depreciation expense associated with the Company’s strategic decision to exit the fully bundled sales system of NV Energy. Operating income at our domestic resorts increased 35%, or $481 million in 2017 compared to 2016, and benefitted from a full year of contributions from Borgata and MGM National Harbor and a decrease in preopening expense. See “Operating Results – Details of Certain Charges” below for additional detail on our preopening expense. Corporate expense increased to $357 million in 2017 from $313 million in 2016, primarily from a $16 million charge for the Operating Partnership’s share of real estate transfer taxes recorded in connection with the MGM National Harbor transaction, with the remainder of the increase primarily related to corporate brand campaign expenses, legal expenses, and charitable contributions. Operating income at MGM China decreased 24%, or $62$60 million compared to 2016 duethe prior year primarily to an increase in preopening expense related to the MGM Cotai project. Income from unconsolidated affiliates was $146 million in 2017 compared to $528 million in 2016, which included the gain related to the sale of Crystals. See “Operating Results – Income from Unconsolidated Affiliates” for additional detail.

Consolidated operating income was $2.1 billion in 2016 compared to an operating loss of $156 million in 2015. Operating income in 2016 was affected by the items discussed above. Operating loss in 2015 was negatively affected by a $1.5 billion non-cash impairment charge to goodwill recognized in the acquisition of a controlling interest in MGM China in 2011. The impairment charge resulted from our annual review of our goodwill carrying values and was incurred as a result of reduced cash flow forecasts for MGM China’s resorts based on market conditions at that time and lower valuation multiples for gamingcertain assets

42

becoming fully depreciated in the Macau market. Income from unconsolidated affiliates was $528current year at MGM China, primarily at MGM Cotai. General and administrative expense increased $385 million in 2016, as discussed above, compared to $258 million in 2015, which included $80 million related to our share of the gain recognized by CityCenter as a result of the final resolution of its construction litigation and related settlements. Corporate expense increased to $313 million in 2016 from $275 million in 2015,prior year due primarily to costs incurredthe prior year reflecting the temporary property closures, the inclusion of rent expense for the Aria lease, which commenced in September 2021, and also due to implementa full period of rent expense for the MGM Grand Las Vegas and Mandalay Bay lease in the current year, partially offset by realized benefits from our cost savings initiatives related to the Profit Growth Plan of $23 million, costs associated with the initial public offering of MGP of $25 million, transaction costs incurred in connection with the Borgata transaction, incremental performance-based compensation expense, and costs associated with a litigation settlement.

at our domestic properties.


Operating Results – Detailed

Net Revenues by Segment Information


The following table presents a detail by segment of consolidated net revenues and Adjusted EBITDA. Management uses Adjusted Property EBITDA as the primary profit measure for its reportable segments. See “Non-GAAP Measures” for additional information:  

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Net Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Domestic resorts

 

$

8,322,403

 

 

$

7,055,718

 

 

$

6,497,361

 

MGM China

 

 

1,970,494

 

 

 

1,920,487

 

 

 

2,214,767

 

Reportable segment net revenues

 

 

10,292,897

 

 

 

8,976,205

 

 

 

8,712,128

 

Corporate and other

 

 

481,007

 

 

 

478,918

 

 

 

477,940

 

 

 

$

10,773,904

 

 

$

9,455,123

 

 

$

9,190,068

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

 

Domestic resorts

 

$

2,514,819

 

 

$

2,063,016

 

 

$

1,689,966

 

MGM China

 

 

524,953

 

 

 

520,736

 

 

 

539,881

 

Reportable segment Adjusted Property EBITDA

 

 

3,039,772

 

 

 

2,583,752

 

 

 

2,229,847

 

Corporate and other

 

 

(202,675

)

 

 

211,932

 

 

 

9,073

 

 

 

$

2,837,097

 

 

$

2,795,684

 

 

$

2,238,920

 

Domestic resorts. The following table is a reconciliation of domestic resorts net revenues to domestic resorts same-store net revenues:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Domestic resorts net revenues

 

$

8,322,403

 

 

$

7,055,718

 

 

$

6,497,361

 

Net revenues related to Borgata

 

 

(850,766

)

 

 

(348,462

)

 

 

—

 

Net revenues related to MGM National Harbor

 

 

(717,436

)

 

 

(53,005

)

 

 

—

 

Net revenues related to sold resort operations

 

 

—

 

 

 

—

 

 

 

(78,792

)

Domestic resorts same-store net revenues

 

$

6,754,201

 

 

$

6,654,251

 

 

$

6,418,569

 


The following table presents detailed net revenues at our domestic resorts:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Casino revenue, net

 

 

 

 

 

 

 

 

 

 

 

 

Table games

 

$

1,436,065

 

 

$

1,051,147

 

 

$

880,318

 

Slots

 

 

2,473,720

 

 

 

1,920,284

 

 

 

1,720,028

 

Other

 

 

139,647

 

 

 

83,020

 

 

 

70,148

 

Casino revenue, net

 

 

4,049,432

 

 

 

3,054,451

 

 

 

2,670,494

 

Non-casino revenue

 

 

 

 

 

 

 

 

 

 

 

 

Rooms

 

 

2,095,605

 

 

 

1,965,378

 

 

 

1,813,838

 

Food and beverage

 

 

1,736,640

 

 

 

1,578,704

 

 

 

1,500,039

 

Entertainment, retail and other

 

 

1,273,331

 

 

 

1,166,477

 

 

 

1,167,488

 

Non-casino revenue

 

 

5,105,576

 

 

 

4,710,559

 

 

 

4,481,365

 

 

 

 

9,155,008

 

 

 

7,765,010

 

 

 

7,151,859

 

Less: Promotional allowances

 

 

(832,605

)

 

 

(709,292

)

 

 

(654,498

)

 

 

$

8,322,403

 

 

$

7,055,718

 

 

$

6,497,361

 

 Year Ended December 31,
 202120202019
 (In thousands)
Las Vegas Strip Resorts   
Casino$1,549,419 $728,254 $1,296,170 
Rooms1,402,712 662,813 1,863,521 
Food and beverage1,015,366 471,529 1,517,745 
Entertainment, retail and other769,688 383,189 1,153,615 
 4,737,185 2,245,785 5,831,051 
Regional Operations   
Casino2,721,515 1,569,193 2,537,780 
Rooms220,828 130,945 316,753 
Food and beverage307,750 184,153 494,243 
Entertainment, retail and other142,270 82,880 201,008 
 3,392,363 1,967,171 3,549,784 
MGM China   
Casino1,057,962 565,671 2,609,806 
Rooms66,498 36,624 142,306 
Food and beverage68,489 40,284 127,152 
Entertainment, retail and other17,812 14,124 26,158 
 1,210,761 656,703 2,905,422 
Reportable segment net revenues9,340,309 4,869,659 12,286,257 
Corporate and other339,831 292,423 613,415 
 $9,680,140 $5,162,082 $12,899,672 



The following table presents detailed domestic resorts same-store net revenues:

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

(In thousands)

 

 

Casino revenue, net

 

 

 

 

 

 

 

 

 

 

 

 

 

Table games

 

$

961,118

 

 

$

951,836

 

 

$

874,879

 

 

Slots

 

 

1,743,873

 

 

 

1,723,576

 

 

 

1,693,717

 

 

Other

 

 

68,134

 

 

 

60,398

 

 

 

69,114

 

 

Casino revenue, net

 

 

2,773,125

 

 

 

2,735,810

 

 

 

2,637,710

 

 

Non-casino revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

Rooms

 

 

1,935,625

 

 

 

1,910,765

 

 

 

1,794,289

 

 

Food and beverage

 

 

1,502,255

 

 

 

1,511,189

 

 

 

1,486,175

 

 

Entertainment, retail and other

 

 

1,192,355

 

 

 

1,143,361

 

 

 

1,148,877

 

 

Non-casino revenue

 

 

4,630,235

 

 

 

4,565,315

 

 

 

4,429,341

 

 

 

 

 

7,403,360

 

 

 

7,301,125

 

 

 

7,067,051

 

 

Less: Promotional allowances

 

 

(649,159

)

 

 

(646,874

)

 

 

(648,482

)

 

 

 

$

6,754,201

 

 

$

6,654,251

 

 

$

6,418,569

 

Las Vegas Strip Resorts

Casino


Las Vegas Strip Resorts casino revenue increased 33%was $1.5 billion in 20172021, compared to 2016. Same-store casino revenue increased 1%$728 million in 2017 compared to the prior year2020, an increase of 113%, due primarily to the temporary property closures for a 1% increase in both table games revenueportion of 2020 and slots revenue.

Casino revenue increased 14% in 2016 compared to 2015. Same-store casino revenue increased 4% compared to prior year due primarily toremoval of mandated operational and capacity restrictions, as well as an increase in table games revenue. Same-store table games revenue increased 9%travel in 2016 comparedthe current year, and the inclusion of the operating results of Aria subsequent to 2015 due to an increaseconsolidation in same-store table games hold percentage to 23.2% from 20.5% in 2015. On a same-store basis, slots revenue increased 2% compared to the prior year.

September 2021.


43

The following table shows key gaming statistics for the Company’s Las Vegas Strip resorts:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table Games Drop

 

$

3,777

 

 

$

3,723

 

 

$

4,029

 

Table Games Win %

 

 

24.7

%

 

 

24.4

%

 

 

21.2

%

Slot Handle

 

$

12,396

 

 

$

12,437

 

 

$

12,831

 

Slot Hold %

 

 

8.9

%

 

 

8.9

%

 

 

8.4

%

Domestic resorts rooms revenue increased 7% in 2017 compared to 2016. On a same-store basis, rooms revenue increased 1% in 2017 compared to 2016 as a result of a 2% increase in REVPAR at our Las Vegas Strip resorts. Domestic resorts rooms revenue increased 8% in 2016 compared to 2015. On a same-store basis, rooms revenue increased 6% in 2016 compared to 2015 as a result of a 6% increase in REVPAR at our Resorts:


 Year Ended December 31,
 202120202019
 (Dollars in millions)
Table Games Drop$3,597 $2,001 $3,526 
Table Games Win$885 $470 $789 
Table Games Win %24.6 %23.5 %22.4 %
Slots Handle$15,089 $6,904 $12,874 
Slots Win$1,417 $649 $1,194 
Slots Hold %9.4 %9.4 %9.3 %

Las Vegas Strip resorts.

Resorts rooms revenue was $1.4 billion in 2021, compared to $663 million in 2020, an increase of 112%, due primarily to the temporary property closures for a portion of the prior year and removal of mandated operational and capacity restrictions, as well as an increase in travel in the current year, and the inclusion of the operating results of Aria subsequent to consolidation in September 2021.


The following table shows key hotel statistics for our Las Vegas Strip resorts:

Resorts:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

Occupancy

 

 

91

%

 

 

93

%

 

 

93

%

Average Daily Rate (ADR)

 

$

165

 

 

$

157

 

 

$

149

 

Revenue per Available Room (REVPAR)

 

 

151

 

 

 

146

 

 

 

138

 


Food

 Year Ended December 31,
 202120202019
Occupancy(1)
74 %55 %91 %
Average Daily Rate (ADR)$173 $161 $167 
Revenue per Available Room (REVPAR)(1)
$128 $88 $153 

(1)Rooms that were out of service, including full and beverage revenues increased 10% in 2017 comparedmidweek closures, during the years ended December 31, 2021 and 2020 due to 2016. Same-storethe COVID-19 pandemic were excluded from the available room count when calculating hotel occupancy and REVPAR.

Las Vegas Strip Resorts food and beverage revenue decreased 1%was $1.0 billion in 20172021, compared to 2016 primarily due to a decrease at Monte Carlo as a result$472 million in 2020, an increase of disruption related to the transformation of Monte Carlo into Park MGM and NoMad Hotel. Food and beverage revenues increased 5% in 2016 compared to 2015. Same-store food and beverage revenue increased 2% in 2016 compared to 2015115%, due primarily to an increasethe temporary closures at certain properties and operational and capacity restrictions in conventionthe prior year and banquet business, andremoval of those restrictions in the opening of several new outlets.


Entertainment, retail and other revenues increased 9% in 2017 compared to 2016. Same-store entertainment, retail and other revenues increased 4% in 2017 compared to 2016 due primarily to valet and self-parking fees and ATM commissions. Entertainment, retail and other revenues decreased less than 1% in 2016 compared to 2015, and same-store entertainment, retail and other revenues decreased less than 1% due primarily to a 5% decrease in entertainment revenue as a result of our strategic decision to lease MGM Grand Garden Arena to a subsidiary of the Las Vegas Arena Company, LLC effective on January 1, 2016 offset by a 7% increase in other revenue primarily as a result of valet and self-parking fees which were implemented in June 2016.

The following table is a reconciliation of domestic resorts Adjusted Property EBITDA to domestic resorts Same-store Adjusted Property EBITDA. See “Non-GAAP Measures” for additional information on domestic resorts Same-store Adjusted Property EBITDA:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Domestic resorts Adjusted Property EBITDA

 

$

2,514,819

 

 

$

2,063,016

 

 

$

1,689,966

 

          Adjusted Property EBITDA related to Borgata

 

 

(283,353

)

 

 

(81,281

)

 

 

—

 

          Adjusted Property EBITDA related to MGM National Harbor

 

 

(134,293

)

 

 

(9,596

)

 

 

—

 

          Adjusted Property EBITDA related to sold resort operations

 

 

—

 

 

 

—

 

 

 

(3,441

)

Domestic resorts Same-store Adjusted Property EBITDA

 

$

2,097,173

 

 

$

1,972,139

 

 

$

1,686,525

 

Adjusted Property EBITDA at our domestic resorts was $2.5 billion in 2017, an increase of 22% compared to 2016, and was positively impacted by a fullcurrent year of operations at Borgata and MGM National Harbor. Same-store Adjusted Property EBITDA increased 6% in 2017 compared to 2016. Same-store Adjusted Property EBITDA margin increased in 2017 by 141 basis points compared to 2016 to 31.0% due to an increase in casino and non-casino revenue as discussed above as well as a decrease in general and administrative expense related to a decrease in payroll costs and utilities.  

Adjusted Property EBITDA at our domestic resorts was $2.1 billion in 2016, an increase of 22% compared to 2015 due primarily to approximately $244 million of incremental Adjusted Property EBITDA growth generated from the Company’s Profit Growth Plan initiatives as well as $81 million of Adjusted Property EBITDA resulting from the Borgata transaction and $10 million of Adjusted Property EBITDA resulting from the December 2016 opening of MGM National Harbor as well as an increase in revenuestravel in the current year, and the inclusion of the operating results of Aria subsequent to consolidation in September 2021. However, not all outlets were fully re-opened during the current year and the properties did not benefit from the removal of mandated operational and capacity restrictions as discussed above. Same-store Adjusted Property EBITDA increased 17% in 2016 compared to 2015. Same-store Adjusted Property EBITDA margin increased in 2016 by 336 basis points compared to 2015 to 29.6%.

MGM China. The following table presents detailed net revenue for MGM China:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Casino revenue, net

 

 

 

 

 

 

 

 

 

 

 

 

VIP table games

 

$

698,437

 

 

$

720,522

 

 

$

977,182

 

Main floor table games

 

 

1,054,028

 

 

 

999,506

 

 

 

986,063

 

Slots

 

 

179,280

 

 

 

161,586

 

 

 

209,098

 

Casino revenue, net

 

 

1,931,745

 

 

 

1,881,614

 

 

 

2,172,343

 

Non-casino revenue

 

 

119,686

 

 

 

119,419

 

 

 

135,585

 

 

 

 

2,051,431

 

 

 

2,001,033

 

 

 

2,307,928

 

Less: Promotional allowances

 

 

(80,937

)

 

 

(80,546

)

 

 

(93,161

)

 

 

$

1,970,494

 

 

$

1,920,487

 

 

$

2,214,767

 

Net revenue for MGM China increased 3% in 2017 compared to 2016 primarilywell as a result of an increase in main floor table gamestravel primarily until the latter part of the second quarter of the current year.


Las Vegas Strip Resorts entertainment, retail and other revenue of 5%, which was partially offset by a 3% decrease$770 million in VIP table games revenue. VIP table games volume increased slightly in 20172021, compared to 2016 while VIP hold percentage was 3.2% for both the current and prior year periods. Main floor table games volume decreased 1% and hold percentage increased to 20.2%$383 million in 2017 from 18.8% in 2016. Slots revenue increased 11% in 2017 compared to 20162020, an increase of 101%, due primarily to an 8% increase in slots volume.

MGM China’s Adjusted EBITDA was $525 million in 2017 and $521 million in 2016. Excluding intercompany branding feesthe temporary property closures for a portion of $34 million for both the years ended December 31, 2017 and 2016, Adjusted EBITDA increased 1% compared to 2016. Adjusted EBITDA margin was 26.6% in 2017 compared to 27.1% in 2016 and decreased in part as a result of a 7% increase in general and administrative expense.


Net revenue for MGM China decreased 13% in 2016 compared to 2015 primarily as a result of a decrease in VIP table games revenue of 26%, which was slightly offset by a 1% increase in main floor table games revenue. VIP table games turnover decreased 24% compared to the prior year and VIP table games hold percentage decreasedremoval of mandated operational and capacity restrictions as well as an increase in travel in the current year, and the inclusion of the operating results of Aria subsequent to 3.2%consolidation in 2016 from 3.3%September 2021. However, venue re-openings and events did not primarily occur until beginning in 2015. Slotsthe latter part of the second quarter of the current year.


Regional Operations

Regional Operations casino revenue decreased 23%was $2.7 billion in 20162021, compared to 2015$1.6 billion in 2020, an increase of 73%, due primarily to the temporary property closures in the prior year and removal of mandated operational and capacity restrictions and, to a lesser extent, increase in travel in the current year.

44

The following table shows key gaming statistics for our Regional Operations:

 Year Ended December 31,
 202120202019
 (Dollars in millions)
Table Games Drop$3,980 $2,422 $4,226 
Table Games Win$788 $488 $827 
Table Games Win %19.8 %20.1 %19.6 %
Slots Handle$25,566 $14,527 $25,031 
Slots Win$2,462 $1,405 $2,363 
Slots Hold %9.6 %9.7 %9.4 %

Regional Operations rooms revenue was $221 million in 2021, compared to $131 million in 2020, an 18% decreaseincrease of 69%, due primarily to the temporary property closures in slots volume. Casinothe prior year and removal of mandated operational and capacity restrictions and, to a lesser extent, increase in travel in the current year.

Regional Operations food and beverage revenue was $308 million in 2021, compared to $184 million in 2020, an increase of 67%, due primarily to the temporary property closures in the prior year and removal of mandated operational and capacity restrictions beginning primarily in the second quarter of the current year.

Regional Operations entertainment, retail and other revenue was $142 million in 2021, compared to $83 million in 2020, an increase of 72%, due primarily to temporary property closures in the prior year and removal of mandated operational and capacity restrictions beginning primarily in the second quarter of the current year.

MGM China

The following table shows key gaming statistics for MGM China:

 Year Ended December 31,
 202120202019
 (Dollars in millions)
VIP Table Games Turnover$8,499 $7,015 $38,071 
VIP Table Games Win$272 $213 $1,237 
VIP Table Games Win %3.2 %3.0 %3.2 %
Main Floor Table Games Drop$4,509 $2,037 $8,252 
Main Floor Table Games Win$966 $467 $1,907 
Main Floor Table Games Win %21.4 %22.9 %23.1 %

MGM China net revenues were $1.2 billion in 2021, compared to $657 million in 2020, an increase of 84%. The prior year was negatively affected by both property closures in 2016 by the changes in economic factorsFebruary 2020 and policy initiatives in China that began to take place in 2014, and VIP table games revenue was furthermore significantly impacted by travel and entry restrictions in Macau than in the new regulatory compliance requirements implemented in late 2015 and in 2016 for gaming promoters and operators, as well as the curtailing of “proxy” bets as a result of the ban on mobile phone usage at gaming tables, which began in 2016.

MGM China’s Adjusted EBITDA was $521 million in 2016 and $540 million in 2015. Excluding intercompany branding fees of $34 million and $39 million for the years ended December 31, 2016 and 2015, respectively, Adjusted EBITDA decreased 4% compared to 2015. Adjusted EBITDA margin increased 274 basis points to 27.1% in 2016 primarily as a result of an increase in main floor table games mix and cost reduction efforts.

current year.


Corporate and other.other

Corporate and other revenue includes revenues from other corporate operations, management services and reimbursed costs revenue primarily related to our CityCenter management agreement.agreement (which was terminated upon the acquisition of CityCenter in September 2021). Reimbursed costs revenue represents reimbursement of costs, primarily payroll-related, incurred by us in connection with the provision of management services and was $402$226 million, $397$245 million and $399$437 million for 2017, 20162021, 2020 and 2015,2019, respectively.

Adjusted EBITDA related to corporate and other in 2017 Reimbursed costs revenue for the year ended December 31, 2021 decreased compared to the prior year due primarily to the termination of the CityCenter management agreement as discussed above. See below for additional discussion of our share of operating results from unconsolidated affiliates.


45

Adjusted Property EBITDAR and Adjusted EBITDAR

The following table presents Adjusted Property EBITDAR and Adjusted EBITDAR. Adjusted Property EBITDAR is our reportable segment generally accepted accounting principles (“GAAP”) measure, which we utilize as the gain recognizedprimary profit measure for our reportable segments. See Note 17 to the accompanying consolidated financial statements and “Reportable Segment GAAP measure” below for additional information.

 Year Ended December 31,
 202120202019
 (In thousands)
Las Vegas Strip Resorts$1,738,211 $232,188 $1,643,122 
Regional Operations1,217,814 343,990 969,866 
MGM China25,367 (193,832)734,729 
Corporate and other(560,309)(530,843)(331,621)
Adjusted EBITDAR$2,421,083 

Las Vegas Strip Resorts

Las Vegas Strip Resorts Adjusted Property EBITDAR was $1.7 billion in 20162021 compared to $232 million in 2020. Las Vegas Strip Resorts Adjusted Property EBITDAR margin increased to 36.7% in 2021 compared to 10.3% in 2020. The current year benefited from the sale of Crystals at CityCenter, the gain on the acquisition of Borgata in 2016 and an increase in stock-based compensation, partially offset byrevenues, as discussed above, as well as realized benefits from our cost savings initiatives.

Regional Operations

Regional Operations Adjusted Property EBITDAR was $1.2 billion in 2021 compared to $344 million in 2020. Regional Operations Adjusted Property EBITDAR margin increased to 35.9% in 2021 compared to 17.5% in 2020 as the cessationcurrent year benefited from the increase in revenues, as discussed above, as well as realized benefits from our cost saving initiatives.

MGM China

MGM China’s Adjusted Property EBITDAR was $25 million in 2021 compared to a loss of equity method accounting for Borgata subsequent$194 million in 2020. The increase was due primarily to the acquisitiontemporary property closures in the prior year as well as the prior year being more significantly impacted by travel and an increaseentry restrictions in corporate expense as described in “Summary Operating Results.” See “Operating Results – Income from Unconsolidated Affiliates” for further discussion regarding CityCenterMacau and Borgata.

Adjusted EBITDAother operational restrictions related to corporatethe pandemic than in the current year. License fee expense was $21 million for 2021 and other$11 million in 2016 increased due to our share of the gain recognized from the sale of Crystals at CityCenter. See “Operating Results – Income from Unconsolidated Affiliates” for further discussion. The increase in income from unconsolidated affiliates was partially offset by an increase in corporate expense and an increase in stock-based compensation.

prior year.


Operating Results – Details of Certain Charges

Preopening and start-up expenses consisted of the following:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

MGM China

 

$

86,970

 

 

$

27,848

 

 

$

13,863

 

MGM Springfield

 

 

22,881

 

 

 

26,210

 

 

 

19,654

 

Monte Carlo rebranding

 

 

6,498

 

 

 

589

 

 

 

—

 

MGM National Harbor

 

 

366

 

 

 

77,242

 

 

 

32,837

 

Other

 

 

1,760

 

 

 

8,186

 

 

 

4,973

 

 

 

$

118,475

 

 

$

140,075

 

 

$

71,327

 


Preopening and start-up expenses decreased in 2017 due primarily to a decrease in preopening and start-up expenses at MGM National Harbor (as it opened in December 2016), partially offset by an increase in preopening and start-up expenses at MGM China related to MGM Cotai (which opened in February 2018) and at Monte Carlo as part of the property’s on-going rebrand to Park MGM and NoMad Hotel. Preopening and start-up expenses at MGM China include $7 million of amortization of the Cotai land concession premium in each of the years ended December 31, 2017, 2016 and 2015. Preopening and start-up expenses at MGM National Harbor include $15 million and $19 million of rent expense for the years ended December 31, 2016 and 2015, respectively, which relates to the ground lease for the land on which MGM National Harbor was developed. As the property was open for the entirety of 2017, no rent expense relating to the ground lease was recorded in preopening and start-up expenses at MGM National Harbor for 2017.


Property transactions, net consisted of the following:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Grand Victoria investment impairment

 

$

—

 

 

$

—

 

 

$

17,050

 

Gain on sale of Circus Circus Reno and Silver Legacy investment

 

 

—

 

 

 

—

 

 

 

(23,002

)

Other property transactions, net

 

 

50,279

 

 

 

17,078

 

 

 

41,903

 

 

 

$

50,279

 

 

$

17,078

 

 

$

35,951

 


 Year Ended December 31,
 202120202019
 (In thousands)
Loss related to sale of Circus Circus Las Vegas and adjacent land$— $— $220,294 
Other property transactions, net(67,736)93,567 55,508 
 $(67,736)$93,567 $275,802 

See Note 16 to the accompanying consolidated financial statements for a discussion of property transactions, net for the years ended December 31, 2017, 2016 and 2015.

net.



46

Operating Results – Income from Unconsolidated Affiliates


The following table summarizes information related to our share of operating income from unconsolidated affiliates:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

CityCenter

 

$

133,167

 

 

$

445,181

 

 

$

158,906

 

Borgata (through July 31, 2016)

 

 

—

 

 

 

61,169

 

 

 

75,764

 

Other

 

 

12,822

 

 

 

21,266

 

 

 

23,213

 

 

 

$

145,989

 

 

$

527,616

 

 

$

257,883

 


We

 Year Ended December 31,
 202120202019
 (In thousands)
CityCenter (through September 26, 2021)$128,127 $(29,753)$128,421 
MGP BREIT Venture155,817 136,755 — 
BetMGM(211,182)(61,663)(15,804)
Other12,061 (2,401)6,904 
 $84,823 $42,938 $119,521 

In September 2021, we completed ourthe acquisition of Borgata on August 1, 2016, at which time the subsidiary operating Borgata became a consolidated subsidiary. Prior to the acquisition, we held a 50% ownership interest in Borgata, which was accountedCityCenter held by Infinity World and now own 100% of the equity interest in CityCenter. Accordingly, we no longer account for our interest in CityCenter under the equity method.

method of accounting, and we now consolidate CityCenter in our financial statements.


In 2017,June 2021, CityCenter closed the sale of its Harmon land for $80 million on which it recorded a $30 million gain. We recorded a $50 million gain, which included $15 million of our 50% share of the gain recorded by CityCenter and $35 million representing the reversal of certain basis differences in 2021.

Our share of CityCenter’s operating results,income, including certain basis difference adjustments, was $133$128 million which included a benefit of $4 million relatedfor the current year period through September 26, 2021 compared to our share of CityCenter's operating loss of $30 million in 2020, due primarily to the modificationtemporary property closures in the prior year and removal of the NV Energy exit fee. At Aria, casino revenues increased 8% in 2017 compared to 2016, due to a 2% increase in table games dropmandated operational and capacity restrictions, an increase in hold percentage to 25.3%travel beginning primarily in 2017 compared to 24.6% in 2016 as well as a 6% increase in slots revenue. REVPAR increased by 5%the second quarter of the current year, and 2% at Aria and Vdara, respectively, which led to a 4% increase in CityCenter’s rooms revenue in 2017 compared to 2016. CityCenter food and beverage revenue increased 7% in 2017 due in part to an increase in catering and banquets during the year.

In 2016, our share of CityCenter’s operating results, including certain basis difference adjustments, was $445 million, which included $13 million related to our share of NV Energy exit expense representing CityCenter’s share of a charge associated with our strategic decision to exit the fully bundled sales system of NV Energy, $41 million related to our share of accelerated depreciationgain related to the April 2016 closure of the Zarkana theatre, as well as $401 million related to our share of a gain recognized by CityCenter on the sale of Crystals andits Harmon land in the reversal of certain basis differences, compared to $159 million in 2015, which included $80 million related to our share of a gain recognized by CityCentercurrent year, as a result of the final resolution of its construction litigation and related settlements. At Aria, casino revenues decreased 2% in 2016 compared to 2015, due to a 7% decrease in table games volume partially offset by an increase in hold percentage to 24.6% in 2016 compared to 23.8% in 2015. The decrease in table games revenue wasdiscussed above, partially offset by a 2% increaseshorter comparative period in slots revenue. REVPAR increased by 4% and 8% at Aria and Vdara, respectively, which led to a 7% increasethe current year given that, as of September 2021, we no longer account for our interest in CityCenter’s rooms revenue in 2016 compared to 2015.

CityCenter under the equity method of accounting, as discussed above.


Non-operating Results


Interest expense. The following table summarizes information related to interest on our long-term debt:

expense, net:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Total interest incurred – MGM Resorts (excluding MGM China)

 

$

691,475

 

 

$

746,467

 

 

$

808,733

 

Total interest incurred – MGM China

 

 

88,380

 

 

 

68,264

 

 

 

53,644

 

Interest capitalized

 

 

(111,110

)

 

 

(119,958

)

 

 

(64,798

)

 

 

$

668,745

 

 

$

694,773

 

 

$

797,579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash paid for interest, net of amounts capitalized

 

$

658,637

 

 

$

661,166

 

 

$

776,540

 

End-of-year ratio of fixed-to-floating debt

 

73/27

 

 

68/32

 

 

67/33

 

End-of-year weighted average interest rate

 

 

5.2

%

 

 

5.4

%

 

 

5.9

%


In 2017,

 Year Ended December 31,
 202120202019
 (In thousands)
Total interest incurred$800,156 $679,251 $853,007 
Interest capitalized(563)(2,871)(5,075)
 $799,593 $676,380 $847,932 

Gross interest cost related to MGM Resorts, excluding MGM China, decreasedexpense was $800 million in 2021 compared to 2016$679 million in 2020. The increase in gross interest expense was due primarily as a result of a decreaseto an increase in the average debt outstanding related to our senior notes due to the issuances by us, the Operating Partnership and MGM China in 2020 and 2021, partially offset by a decrease in the weighted average interest rate of ourthe senior notes. ThisSee Note 9 to the accompanying consolidated financial statements for additional discussion on long-term debt and see “Liquidity and Capital Resources” for additional discussion on issuances and repayments of long-term debt and other sources and uses of cash.

Other, net. Other income, net was $66 million in 2021 compared to other expense, net of $89 million in 2020. The current year included a $28 million net gain on change in fair value of an equity instrument, a $39 million gain on the Operating Partnership’s unhedged interest rate swaps, and $22 million of interest income, partially offset by an increase in the average debt outstanding under our credit facilities and an increase in amortization$13 million of debt issuance costs. Interest costforeign currency remeasurement losses primarily related to MGM China increased in 2017 compared to 2016 due to an increase in the average outstanding amounts borrowed under the MGM China credit facility and an increase in the weighted average interest rate. In 2016, interest cost related to MGM Resorts, excluding MGM China, decreased compared to 2015 primarily asChina’s U.S. dollar-denominated senior notes. The prior year included a result of a decrease in the average long-term debt outstanding, and also due to a decrease in the weighted average interest rate, partially offset by an increase in amortization of debt issuance cost associated with the MGP related financing transactions in April 2016. Interest cost related to MGM China increased in 2016 compared to 2015 due to an increase in the average outstanding amounts borrowed under the MGM China credit facility partially offset by a decrease in amortization of debt issuance costs.

Capitalized interest in 2017 decreased from 2016 due primarily to the opening of MGM National Harbor in December 2016, partially offset due to the MGM Cotai and MGM Springfield projects. Capitalized interest in 2016 increased compared to 2015 due primarily to the MGM Cotai, MGM National Harbor, and MGM Springfield projects.

Non-operating items from unconsolidated affiliates. Non-operating expense from unconsolidated affiliates decreased $18 million in 2017 compared to 2016, and decreased $23 million in 2016 compared to 2015, due primarily to the acquisition of Borgata on August 1, 2016, at which time the subsidiary operating Borgata became a consolidated subsidiary of our company. Prior to the acquisition, we held a 50% ownership interest in Borgata, which was accounted for under the equity method.

Other, net. Other expense in 2017 primarily consisted of a $30$109 million loss incurred on the early retirement of debt related to our 11.375% senior notes due 2018,and the termination of our revolving facility, as well as a $14an $18 million loss incurred on the early retirement of debt related to the MGM National Harbor credit facility. Other expense in 2016Operating Partnership’s repayment of its term loan A facility and its term loan B facility, partially offset by $9 million of foreign currency remeasurement gains primarily consisted of a $16 million loss on the early retirement of debt related to our 7.625%MGM China’s U.S. dollar-denominated senior notes, due 2017, as well as a $49and $32 million loss incurred on the early retirement of debt related to our previously outstanding 7.5% senior notes due 2016 and 10% senior notes due 2016 and our prior senior credit facility, recorded in the second quarter of 2016. The previously discussed losses related to the early retirement of debt recorded in 2016 are primarily responsible for the increase in other non-operating expense from 2016 to 2015.

interest income.

47


Income taxes. The following table summarizes information related to our income taxes:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Income (loss) before income taxes

 

$

963,755

 

 

$

1,259,177

 

 

$

(1,046,243

)

Benefit (provision) for income taxes

 

 

1,132,663

 

 

 

(22,299

)

 

 

6,594

 

Effective income tax rate

 

 

(117.5

)%

 

 

1.8

%

 

 

0.6

%

Federal, state and foreign income taxes paid, net of refunds

 

$

181,651

 

 

$

68,236

 

 

$

11,801

 

 Year Ended December 31,
 202120202019
 (In thousands)
Income (loss) before income taxes$1,461,804 $(1,511,479)$2,846,725 
Benefit (provision) for income taxes(253,416)191,572 (632,345)
Effective income tax rate17.3 %12.7 %22.2 %
Federal, state and foreign income taxes paid, net of refunds$43,018 $8,543 $28,493 

Our effective tax rate in 2017for 2021 was favorably impacted by a non-recurring, non-cash income tax benefit of $1.4 billion resulting from the remeasurement of deferred tax assets and liabilities required as a result of the enactment of the U.S. Tax Cuts and Jobs Act (the “Tax Act”). Our effective tax rate in 2016 was favorably impacted by income tax benefits attributable to a decrease in valuation allowance on foreign tax credit carryovers and permanent exclusion of a portion of the gain on the Borgata transaction,consolidation of CityCenter partially offset


by income tax expense attributable to the remeasurementunfavorable impact of losses in Macau deferred tax liabilities resulting from a change in assumption concerning renewal of the exemption from the Macau complementary tax on gaming profits. Ourthat we could not benefit. The effective tax rate in 2015for 2020 was unfavorably impacted by the non-cash impairment charge on MGM China goodwilllosses in Macau that we could not benefit and adjustments to valuation allowances for which we did not record incomeMacau deferred tax benefit,assets and foreign tax credits, partially offset by an income tax benefit for foreignresulting from carrying back net operating losses to tax credits, net of valuation allowance.

years with a higher tax rate than is currently in effect.


Cash taxes paid increased in 20172021 compared to 20162020 primarily as a result ofdue to an increase in federal income taxes paid due toresulting from increased U.S. taxable income and state income taxes attributable to Borgata, which has been consolidated sincefollowing the August 2016 acquisitionrecovery of Boyd Gaming’s interest in the company. Cash taxes paid increased in 2016 compared to 2015 primarily as a resultbusiness from the impacts of an increase in federal income taxes paid due to increased U.S. taxable income.

Non-GAAP Measures

COVID-19.


Reportable Segment GAAP measure

“Adjusted EBITDA”Property EBITDAR” is our reportable segment GAAP measure, which we utilize as the primary profit measure for our reportable segments and underlying operating segments. Adjusted Property EBITDAR is a measure defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening and start-up expenses, gain on REIT transactions, net, restructuring costs (which represents costs related to severance, accelerated stock compensation expense, and consulting fees directly related to the operating model component of the MGM 2020 Plan), rent expense associated with triple-net operating and ground leases, income from unconsolidated affiliates related to investments in real estate ventures, property transactions, net, and also excludes gain on consolidation of CityCenter, net, gain related to CityCenter's sale of Harmon land recorded within income from unconsolidated affiliates and corporate expense (which includes CEO transition expense and October 1 litigation settlement) and stock compensation expense, which are not allocated to each operating segment, and rent expense related to the master lease with MGP that eliminates in consolidation. We manage capital allocation, tax planning, stock compensation, and financing decisions at the corporate level. “Adjusted Property EBITDAR margin” is Adjusted Property EBITDAR divided by related segment net revenues.

Non-GAAP Measure

“Adjusted EBITDAR” is earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening and start-up expenses, NV Energy exit expense,property transactions, net, gain on Borgata transaction, goodwill impairment charges, and propertyREIT transactions, net. “Adjusted Property EBITDA” is Adjusted EBITDA before corporatenet, gain on consolidation of CityCenter, net, CEO transition expense, andOctober 1 litigation settlement, restructuring costs (which represents costs related to severance, accelerated stock compensation expense, related to the MGM Resorts and MGP stock compensation plans, which are not allocated to each property. MGM China recognizes stock compensation expense related to its stock-based compensation plan which is included in the calculation of Adjusted EBITDA for MGM China. “Same-store Adjusted Property EBITDA” is Adjusted Property EBITDAconsulting fees directly related to the operating resorts which were consolidated bymodel component of the Company for both the entire currentMGM 2020 Plan), rent expense associated with triple-net operating and prior year periods presented. “Adjusted EBITDA margin”ground leases, gain related to CityCenter's sale of Harmon land recorded within income from unconsolidated affiliates, and income from unconsolidated affiliates related to investments in real estate ventures.

Adjusted EBITDAR information is Adjusted EBITDA divided by net revenues. “Same-store Adjusted Property EBITDA margin” is Same-store Adjusted Property EBITDA divided by “same-store” net revenues. Adjusted EBITDA informationa valuation metric, should not be used as an operating metric, and is presented solely as a supplemental disclosure to reported GAAP measures because management believes these measures are 1)we believe this measure is widely used measures of operating performance in the gaming industry,by analysts, lenders, financial institutions, and 2)investors as a principal basis for the valuation of gaming companies. We present Adjusted Property EBITDA on a “same-store” basis as supplemental information because management believes that providing performance measures on a “same-store” basis is useful for evaluating the period-to-period performance of our domestic casino resorts.

We believe that while items excluded from Adjusted EBITDA, Adjusted Property EBITDA, Same-Store Adjusted Property EBITDA, Adjusted EBITDA margin, and Same-store Adjusted Property EBITDA marginEBITDAR may be recurring in nature and should not be disregarded in evaluation of our earnings performance, it is useful to exclude such items when analyzing current results and trends compared to other periods because these items can vary significantly depending on specific underlying transactions or events that may not be comparable between the periods being presented.trends. Also, we believe excluded items may not relate specifically to current operating trends or be indicative of future results. For example, preopening and start-up expenses will be significantly different in periods when we are developing and constructing a major expansion project and will depend on where the current period lies within the development cycle, as well as the size and scope of the project(s). Property transactions, net includes normal recurring disposals, gains and losses on sales of assets related to specific assets within our resorts, but also includes gains or losses on sales of an entire operating resort or a group of resorts and impairment charges on entire asset groups or investments in unconsolidated affiliates, which may not be comparable period over period. In addition, capital allocation, tax planning, financing and stock compensation awards are all managed at the corporate level. Therefore, we useHowever, as discussed herein, Adjusted Property EBITDA and Same-store Adjusted Property EBITDAEBITDAR should not be viewed as the primarya measure of domestic resortsoverall operating performance.

performance, considered in isolation, or as an alternative to net income, because this measure is not

48

presented on a GAAP basis and exclude certain expenses, including the rent expense associated with our triple-net operating and ground leases, and are provided for the limited purposes discussed herein.

Adjusted EBITDA, Adjusted Property EBITDA, Same-store Adjusted Property EBITDA, Adjusted EBITDA margin or Same-store Adjusted Property EBITDA marginEBITDAR should not be construed as alternativesan alternative to operating income or net income, as indicatorsan indicator of our performance; or as alternativesan alternative to cash flows from operating activities, as measuresa measure of liquidity; or as any other measure determined in accordance with generally accepted accounting principles.GAAP. We have significant uses of cash flows, including capital expenditures, interest payments, taxes, real estate triple-net lease and ground lease payments, and debt principal repayments, which are not reflected in Adjusted EBITDA, Adjusted Property EBITDA, Same-store Adjusted Property EBITDA, Adjusted EBITDA margin, or Same-store Adjusted Property EBITDA margin.EBITDAR. Also, other companies in the gaming and hospitality industries that report Adjusted EBITDA, Adjusted Property EBITDA Same-store Adjusted Property EBITDA, Adjusted EBITDA margin or Same-store Adjusted Property EBITDA marginEBITDAR information may calculate Adjusted EBITDA, Adjusted Property EBITDA, Same-store Adjusted Property EBITDA, Adjusted EBITDA margin or Same-store Adjusted Property EBITDA marginEBITDAR in a different manner.

manner and such differences may be material.


The following table presents a reconciliation of net income (loss) attributable to MGM Resorts International to Adjusted EBITDA:

EBITDAR:

 

Year Ended December 31,

 

 Year Ended December 31,

 

2017

 

 

2016

 

 

2015

 

 202120202019

 

(In thousands)

 

 (In thousands)

Net income (loss) attributable to MGM Resorts International

 

$

1,960,286

 

 

$

1,101,440

 

 

$

(447,720

)

Net income (loss) attributable to MGM Resorts International$1,254,370 $(1,032,724)$2,049,146 

Plus: Net income (loss) attributable to noncontrolling interests

 

 

136,132

 

 

 

135,438

 

 

 

(591,929

)

Plus: Net income (loss) attributable to noncontrolling interests(45,981)(287,183)165,234 

Net income (loss)

 

 

2,096,418

 

 

 

1,236,878

 

 

 

(1,039,649

)

Net income (loss)1,208,389 (1,319,907)2,214,380 

Provision (benefit) for income taxes

 

 

(1,132,663

)

 

 

22,299

 

 

 

(6,594

)

Provision (benefit) for income taxes253,415 (191,572)632,345 

Income (loss) before income taxes

 

 

963,755

 

 

 

1,259,177

 

 

 

(1,046,243

)

Income (loss) before income taxes1,461,804 (1,511,479)2,846,725 

Non-operating expense

 

 

 

 

 

 

 

 

 

 

 

 

Non-operating (income) expenseNon-operating (income) expense

Interest expense, net of amounts capitalized

 

 

668,745

 

 

 

694,773

 

 

 

797,579

 

Interest expense, net of amounts capitalized799,593 676,380 847,932 

Non-operating items from unconsolidated affiliates

 

 

34,751

 

 

 

53,139

 

 

 

76,462

 

Non-operating items from unconsolidated affiliates83,243 103,304 62,296 

Other, net

 

 

48,241

 

 

 

72,698

 

 

 

15,970

 

Other, net(65,941)89,361 183,262 

 

 

751,737

 

 

 

820,610

 

 

 

890,011

 

 816,895 869,045 1,093,490 

Operating income (loss)

 

 

1,715,492

 

 

 

2,079,787

 

 

 

(156,232

)

Operating income (loss)2,278,699 (642,434)3,940,215 

NV Energy exit expense

 

 

(40,629

)

 

 

139,335

 

 

 

—

 

Preopening and start-up expenses

 

 

118,475

 

 

 

140,075

 

 

 

71,327

 

Preopening and start-up expenses5,094 84 7,175 

Property transactions, net

 

 

50,279

 

 

 

17,078

 

 

 

35,951

 

Property transactions, net(67,736)93,567 275,802 

Goodwill impairment

 

 

—

 

 

 

—

 

 

 

1,467,991

 

Gain on Borgata transaction

 

 

—

 

 

 

(430,118

)

 

 

—

 

Gain on REIT transactions, netGain on REIT transactions, net— (1,491,945)(2,677,996)
Gain on consolidation of CityCenter, netGain on consolidation of CityCenter, net(1,562,329)— — 

Depreciation and amortization

 

 

993,480

 

 

 

849,527

 

 

 

819,883

 

Depreciation and amortization1,150,610 1,210,556 1,304,649 

Adjusted EBITDA

 

$

2,837,097

 

 

$

2,795,684

 

 

$

2,238,920

 

CEO transition expenseCEO transition expense— 44,401 — 
October 1 litigation settlementOctober 1 litigation settlement— 49,000 — 
RestructuringRestructuring— 26,025 92,139 
Triple-net operating lease and ground lease rent expenseTriple-net operating lease and ground lease rent expense833,158 710,683 74,656 
Gain related to sale of Harmon land - unconsolidated affiliateGain related to sale of Harmon land - unconsolidated affiliate(49,755)— — 
Income from unconsolidated affiliates related to real estate venturesIncome from unconsolidated affiliates related to real estate ventures(166,658)(148,434)(544)
Adjusted EBITDARAdjusted EBITDAR$2,421,083 



Guarantor Financial Information

As of December 31, 2021, all of our principal debt arrangements are guaranteed by each of our wholly owned material domestic subsidiaries that guarantee our senior credit facility. Our principal debt arrangements are not guaranteed by MGP, the Operating Partnership, MGM Grand Detroit, MGM National Harbor, Blue Tarp reDevelopment, LLC (the entity that operates MGM Springfield), and each of their respective subsidiaries. Our foreign subsidiaries, including MGM China and its subsidiaries, are also not guarantors of our principal debt arrangements. In the event that any subsidiary is no longer a guarantor of our credit facility or any of our future capital markets indebtedness, that subsidiary will be released and relieved of its obligations to guarantee our existing senior notes. The following tables present reconciliationsindentures governing the senior notes further provide that in the event of a sale of all or substantially all of the assets of, or capital stock in a subsidiary guarantor then such subsidiary guarantor will be released and relieved of any obligations under its subsidiary guarantee.

49

The guarantees provided by the subsidiary guarantors rank senior in right of payment to any future subordinated debt of ours or such subsidiary guarantors, junior to any secured indebtedness to the extent of the value of the assets securing such debt and effectively subordinated to any indebtedness and other obligations of our subsidiaries that do not guarantee the senior notes. In addition, the obligations of each subsidiary guarantor under its guarantee is limited so as not to constitute a fraudulent conveyance under applicable law, which may eliminate the subsidiary guarantor’s obligations or reduce such obligations to an amount that effectively makes the subsidiary guarantee lack value.

The summarized financial information of us and our guarantor subsidiaries, on a combined basis, is presented below. Certain of our guarantor subsidiaries collectively own Operating Partnership units and each subsidiary accounts for its respective investment under the equity method within the summarized financial information presented below. These subsidiaries have also accounted for the MGP master lease as an operating income (loss) to Adjusted Property EBITDAlease, recording operating lease liabilities and Adjusted EBITDA:

 

 

Year Ended December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

Preopening

 

 

Property

 

 

Depreciation

 

 

 

 

 

 

 

Operating

 

 

NV Energy

 

 

and Start-up

 

 

Transactions,

 

 

and

 

 

Adjusted

 

 

 

Income (Loss)

 

 

Exit Expense

 

 

Expenses

 

 

Net

 

 

Amortization

 

 

EBITDA

 

 

 

(In thousands)

 

Bellagio

 

$

418,581

 

 

$

(6,970

)

 

$

—

 

 

$

924

 

 

$

92,320

 

 

$

504,855

 

MGM Grand Las Vegas

 

 

279,205

 

 

 

(7,424

)

 

 

6

 

 

 

1,752

 

 

 

70,510

 

 

 

344,049

 

Mandalay Bay

 

 

169,678

 

 

 

(8,524

)

 

 

—

 

 

 

590

 

 

 

96,577

 

 

 

258,321

 

The Mirage

 

 

140,363

 

 

 

(4,043

)

 

 

—

 

 

 

304

 

 

 

39,854

 

 

 

176,478

 

Luxor

 

 

89,045

 

 

 

(3,394

)

 

 

—

 

 

 

2,428

 

 

 

38,489

 

 

 

126,568

 

New York-New York

 

 

108,102

 

 

 

(2,025

)

 

 

(162

)

 

 

720

 

 

 

28,550

 

 

 

135,185

 

Excalibur

 

 

97,331

 

 

 

(2,658

)

 

 

—

 

 

 

485

 

 

 

18,352

 

 

 

113,510

 

Monte Carlo

 

 

(30,597

)

 

 

(2,461

)

 

 

6,532

 

 

 

33,510

 

 

 

42,269

 

 

 

49,253

 

Circus Circus Las Vegas

 

 

55,239

 

 

 

(3,130

)

 

 

452

 

 

 

940

 

 

 

16,756

 

 

 

70,257

 

MGM Grand Detroit

 

 

154,801

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

22,747

 

 

 

177,548

 

Beau Rivage

 

 

62,352

 

 

 

—

 

 

 

—

 

 

 

370

 

 

 

24,865

 

 

 

87,587

 

Gold Strike Tunica

 

 

44,402

 

 

 

—

 

 

 

—

 

 

 

91

 

 

 

9,069

 

 

 

53,562

 

Borgata

 

 

208,628

 

 

 

—

 

 

 

1,430

 

 

 

1,417

 

 

 

71,878

 

 

 

283,353

 

MGM National Harbor

 

 

51,183

 

 

 

—

 

 

 

366

 

 

 

—

 

 

 

82,744

 

 

 

134,293

 

Domestic Resorts

 

 

1,848,313

 

 

 

(40,629

)

 

 

8,624

 

 

 

43,531

 

 

 

654,980

 

 

 

2,514,819

 

MGM China

 

 

193,619

 

 

 

—

 

 

 

86,970

 

 

 

6,286

 

 

 

238,078

 

 

 

524,953

 

Unconsolidated resorts

 

 

145,989

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

145,989

 

Management and other operations

 

 

19,812

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

7,925

 

 

 

27,737

 

 

 

 

2,207,733

 

 

 

(40,629

)

 

 

95,594

 

 

 

49,817

 

 

 

900,983

 

 

 

3,213,498

 

Stock compensation

 

 

(50,365

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(50,365

)

Corporate

 

 

(441,876

)

 

 

—

 

 

 

22,881

 

 

 

462

 

 

 

92,497

 

 

 

(326,036

)

 

 

$

1,715,492

 

 

$

(40,629

)

 

$

118,475

 

 

$

50,279

 

 

$

993,480

 

 

$

2,837,097

 

operating ROU assets with the related rent expense of guarantor subsidiaries reflected within the summarized financial information.

 

 

Year Ended December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transactions, Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preopening

 

 

and Gain on

 

 

Depreciation

 

 

 

 

 

 

 

Operating

 

 

NV Energy

 

 

and Start-up

 

 

Borgata

 

 

and

 

 

Adjusted

 

 

 

Income (Loss)

 

 

Exit Expense

 

 

Expenses

 

 

Transaction

 

 

Amortization

 

 

EBITDA

 

 

 

(In thousands)

 

Bellagio

 

$

366,543

 

 

$

23,815

 

 

$

—

 

 

$

118

 

 

$

88,783

 

 

$

479,259

 

MGM Grand Las Vegas

 

 

231,327

 

 

 

25,365

 

 

 

82

 

 

 

1,719

 

 

 

72,188

 

 

 

330,681

 

Mandalay Bay

 

 

114,202

 

 

 

29,123

 

 

 

252

 

 

 

2,377

 

 

 

89,655

 

 

 

235,609

 

The Mirage

 

 

85,300

 

 

 

13,813

 

 

 

—

 

 

 

44

 

 

 

40,270

 

 

 

139,427

 

Luxor

 

 

57,653

 

 

 

11,594

 

 

 

1,625

 

 

 

708

 

 

 

36,612

 

 

 

108,192

 

New York-New York

 

 

93,169

 

 

 

7,439

 

 

 

479

 

 

 

210

 

 

 

20,432

 

 

 

121,729

 

Excalibur

 

 

71,885

 

 

 

9,083

 

 

 

—

 

 

 

4,405

 

 

 

16,152

 

 

 

101,525

 

Monte Carlo

 

 

33,291

 

 

 

8,409

 

 

 

1,929

 

 

 

1,131

 

 

 

34,102

 

 

 

78,862

 

Circus Circus Las Vegas

 

 

33,516

 

 

 

10,694

 

 

 

—

 

 

 

816

 

 

 

16,963

 

 

 

61,989

 

MGM Grand Detroit

 

 

147,865

 

 

 

—

 

 

 

—

 

 

 

(59

)

 

 

23,608

 

 

 

171,414

 

Beau Rivage

 

 

68,054

 

 

 

—

 

 

 

—

 

 

 

(172

)

 

 

25,880

 

 

 

93,762

 

Gold Strike Tunica

 

 

39,831

 

 

 

—

 

 

 

—

 

 

 

67

 

 

 

9,792

 

 

 

49,690

 

Borgata

 

 

38,616

 

 

 

—

 

 

 

90

 

 

 

8,652

 

 

 

33,923

 

 

 

81,281

 

MGM National Harbor

 

 

(13,626

)

 

 

—

 

 

 

17,986

 

 

 

—

 

 

 

5,236

 

 

 

9,596

 

Domestic Resorts

 

 

1,367,626

 

 

 

139,335

 

 

 

22,443

 

 

 

20,016

 

 

 

513,596

 

 

 

2,063,016

 

MGM China

 

 

255,264

 

 

 

—

 

 

 

27,848

 

 

 

(216

)

 

 

237,840

 

 

 

520,736

 

Unconsolidated resorts

 

 

524,448

 

 

 

—

 

 

 

3,168

 

 

 

—

 

 

 

—

 

 

 

527,616

 

Management and other operations

 

 

4,316

 

 

 

—

 

 

 

1,150

 

 

 

29

 

 

 

7,505

 

 

 

13,000

 

 

 

 

2,151,654

 

 

 

139,335

 

 

 

54,609

 

 

 

19,829

 

 

 

758,941

 

 

 

3,124,368

 

Stock compensation

 

 

(44,957

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(44,957

)

Corporate

 

 

(26,910

)

 

 

—

 

 

 

85,466

 

 

 

(432,869

)

 

 

90,586

 

 

 

(283,727

)

 

 

$

2,079,787

 

 

$

139,335

 

 

$

140,075

 

 

$

(413,040

)

 

$

849,527

 

 

$

2,795,684

 

December 31,
2021
Balance Sheet(In thousands)
Current assets$5,663,171 
Investment in the MGP Operating Partnership2,284,222 
Intercompany accounts due from non-guarantor subsidiaries— 
MGP master lease right-of-use asset, net6,629,140 
Other long-term assets17,025,933 
MGP master lease operating lease liabilities – current154,287 
Other current liabilities2,752,185 
Intercompany accounts due to non-guarantor subsidiaries16,697 
MGP master lease operating lease liabilities – noncurrent7,083,505 
Other long-term liabilities18,472,138 


 

 

Year Ended December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

Property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transactions,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preopening

 

 

Net

 

 

Depreciation

 

 

 

 

 

 

 

Operating

 

 

and Start-up

 

 

and Goodwill

 

 

and

 

 

Adjusted

 

 

 

Income (Loss)

 

 

Expenses

 

 

Impairment

 

 

Amortization

 

 

EBITDA

 

 

 

(In thousands)

 

Bellagio

 

$

303,858

 

 

$

—

 

 

$

1,085

 

 

$

90,442

 

 

$

395,385

 

MGM Grand Las Vegas

 

 

206,896

 

 

 

—

 

 

 

110

 

 

 

73,260

 

 

 

280,266

 

Mandalay Bay

 

 

120,142

 

 

 

—

 

 

 

3,599

 

 

 

79,733

 

 

 

203,474

 

The Mirage

 

 

66,069

 

 

 

115

 

 

 

1,729

 

 

 

44,562

 

 

 

112,475

 

Luxor

 

 

49,369

 

 

 

(2

)

 

 

94

 

 

 

37,708

 

 

 

87,169

 

New York-New York

 

 

81,618

 

 

 

(74

)

 

 

4,931

 

 

 

19,982

 

 

 

106,457

 

Excalibur

 

 

67,545

 

 

 

—

 

 

 

111

 

 

 

14,591

 

 

 

82,247

 

Monte Carlo

 

 

55,594

 

 

 

—

 

 

 

3,219

 

 

 

27,149

 

 

 

85,962

 

Circus Circus Las Vegas

 

 

27,305

 

 

 

280

 

 

 

21

 

 

 

15,639

 

 

 

43,245

 

MGM Grand Detroit

 

 

131,016

 

 

 

—

 

 

 

(36

)

 

 

23,999

 

 

 

154,979

 

Beau Rivage

 

 

62,613

 

 

 

—

 

 

 

(5

)

 

 

26,235

 

 

 

88,843

 

Gold Strike Tunica

 

 

34,362

 

 

 

—

 

 

 

221

 

 

 

11,440

 

 

 

46,023

 

Other resort operations

 

 

2,975

 

 

 

—

 

 

 

—

 

 

 

466

 

 

 

3,441

 

Domestic Resorts

 

 

1,209,362

 

 

 

319

 

 

 

15,079

 

 

 

465,206

 

 

 

1,689,966

 

MGM China

 

 

(1,212,377

)

 

 

13,863

 

 

 

1,472,128

 

 

 

266,267

 

 

 

539,881

 

Unconsolidated resorts

 

 

254,408

 

 

 

3,475

 

 

 

—

 

 

 

—

 

 

 

257,883

 

Management and other operations

 

 

27,395

 

 

 

1,179

 

 

 

1,080

 

 

 

7,765

 

 

 

37,419

 

 

 

 

278,788

 

 

 

18,836

 

 

 

1,488,287

 

 

 

739,238

 

 

 

2,525,149

 

Stock compensation

 

 

(32,125

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(32,125

)

Corporate

 

 

(402,895

)

 

 

52,491

 

 

 

15,655

 

 

 

80,645

 

 

 

(254,104

)

 

 

$

(156,232

)

 

$

71,327

 

 

$

1,503,942

 

 

$

819,883

 

 

$

2,238,920

 

Year Ended
December 31,
2021
Income Statement(In thousands)
Net revenues$6,841,788 
MGP master lease rent expense(630,364)
Operating income2,025,160 
Income from continuing operations1,963,979 
Net income1,702,096 
Net income attributable to MGM Resorts International1,702,096 


Liquidity and Capital Resources


Cash Flows – Summary

We require a certain amount of cash on hand to operate our resorts. In addition to required cash on hand for operations, we utilize company-wide cash management procedures to minimize the amount of cash held on hand or in banks. Funds are swept from the accounts at most of our domestic resorts daily into central bank accounts, and excess funds are invested overnight or are used to repay borrowings under our senior secured credit facility. In addition, from time to time we may use excess funds to repurchase our outstanding debt securities subject to limitations in our senior secured credit facility. At December 31, 2017 and 2016, we held cash and cash equivalents of $1.5 billion and $1.4 billion, respectively. Cash and cash equivalents related to MGM China at December 31, 2017 and 2016 was $676 million and $454 million, respectively. Cash and cash equivalents related to the Operating Partnership at December 31, 2017 and 2016 was $260 million and $360 million, respectively.


Our cash flows consisted of the following:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Net cash provided by operating activities

 

$

2,206,411

 

 

$

1,533,972

 

 

$

1,005,079

 

Net cash used in investing activities

 

 

(1,580,592

)

 

 

(2,276,204

)

 

 

(795,058

)

Net cash provided by (used in) financing activities

 

 

(568,778

)

 

 

519,422

 

 

 

(257,879

)

 Year Ended December 31,
 202120202019
 (In thousands)
Net cash provided by (used in) operating activities$1,373,423 $(1,493,043)$1,810,401 
Net cash provided by investing activities1,543,645 2,159,304 3,519,434 
Net cash provided by (used in) financing activities(2,814,095)2,103,427 (4,529,594)



50

Cash Flows


Operating activities.Trends in our operating cash flows tend to follow trends in operating income, excluding non-cash charges, but can be affected by changes in working capital, cash paid for interest, the timing of significant interest payments, tax payments or refunds, and distributions from unconsolidated affiliates.affiliates. Cash provided by operating activities was $2.2$1.4 billion in 20172021 compared to cash used in operating activities of $1.5 billion in 2016. Operating cash flows increased2020. The change from the prior year was due primarily to the increase in Adjusted Property EBITDAR discussed within the current periodresults of operations section above, and due to an increasethe prior year being negatively affected by a change in operating income at our domestic resorts,working capital related to gaming and non-gaming deposits, gaming taxes and other gaming liabilities, and payroll related liabilities as a result of the COVID-19 pandemic, partially offset by an increase in cash paid for taxes. Cash provided by operating activities in 2017 was positively affected by changes in working capital primarily related to the timing of significant purchases of chips by gaming promoters at MGM China.


Cash provided by operating activities in 2016 increased from 2015 due to an increase in operating income at our domestic resortstriple-net lease rent payments and a decrease in cash paid for interest partially offset by an increase in cash paid forand taxes. Cash provided by operating activities in 2015 was negatively affected by changes in working capital primarily related to short-term gaming liabilities.

We paid net taxes of $182 million, $68 million and $12 million in 2017, 2016 and 2015, respectively.


Investing activities.Our investing cash flows can fluctuate significantly from year to year depending on our decisions with respect to strategic capital investments in new or existing resorts, business acquisitions or dispositions, and the timing of maintenance capital expenditures to maintain the quality of our resorts. Capital expenditures related to regular investments in our existing resorts can also vary depending on timing of larger remodel projects related to our public spaces and hotel rooms. Mostrooms.

Cash provided by investing activities was $1.5 billion in 2021 compared to $2.2 billion in 2020. In 2021, we received $3.9 billion in net cash proceeds from the sale of such costs relate to construction materials, furniturethe real estate of Aria (including Vdara), received $107 million in net proceeds from the sale of property and fixtures, and external labor costs.

In 2017, we had capital expenditures of $1.9 billion, which included $908 million at MGM China, excluding development fees and capitalized interest on development fees eliminated in consolidation. Capital expenditures at MGM China included $856 million related to the construction of MGM Cotai and $53 million related to improvements at MGM Macau.Capital expenditures at our domestic resorts and corporate entities of $956 million included $269 million related to the construction of MGM Springfield, $221 million related to the Monte Carlo rebranding project, and $195 millionequipment, primarily related to the finalizationsale of constructionart, which were partially offset by our payments of MGM National Harbor,$1.8 billion to acquire CityCenter, net of cash acquired, $491 million in capital expenditures, as well as various resorts’ room remodels, constructionfurther discussed below, and contributions of additional convention space at$225 million to BetMGM. In comparison, in the prior year we received $2.5 billion in net cash proceeds from the Mandalay Bay and MGM Grand Las Vegas real estate transaction, which were partially offset by $271 million in capital expenditures and $80 million in contributions to BetMGM. In the parking garage at Excalibur,prior year period, distributions from unconsolidated affiliates included $51 million related to our share of a waterpark at Circus Circus, and various restaurant and entertainment venue remodels.

distribution paid by CityCenter.

Capital Expenditures


In 2016,2021, we hadmade capital expenditures of $2.3 billion,$491 million, of which included $971 million at MGM China, excluding development fees and capitalized interest on development fees eliminated in consolidation. Capital expenditures at MGM China included $948$68 million related to the construction of MGM Cotai and $23 million related to improvements at MGM Macau.Capital expenditures at our domestic resorts and corporate entities of $1.3 billion included $741 million related to the construction of MGM National Harbor, $121 million related to the construction of MGM Springfield, $39 million related to the construction of The Park, as well as various room remodels including the tower rooms at Mandalay Bay, construction of additional exhibit space at the Mandalay Bay Convention Center, construction of the Park Theater and rebranding at Monte Carlo, construction of the parking garage at Excalibur and restaurant and entertainment venue remodels.

In 2015, we had capital expenditures of $1.5 billion, which included $579 million at MGM China, excluding development fees and capitalized interest on development fees eliminated in consolidation.China. Capital expenditures at MGM China included $543$49 million primarily related to construction of the Emerald Tower project at MGM Cotai and $19 million related to the construction of MGM Cotai and $36 million related to improvementsprojects at MGM Macau. Capital expenditures at our domestic resortsLas Vegas Strip Resorts, Regional Operations and corporate entities of $888$423 million included $361primarily relate to expenditures in information technology and room remodels.


In 2020, we made capital expenditures of $271 million, and $35of which $108 million related to theMGM China. Capital expenditures at MGM China included $95 million primarily related to construction close-out and projects at MGM Cotai and $13 million related to projects at MGM Macau. Capital expenditures at our Las Vegas Strip Resorts, Regional Operations and corporate entities of MGM National Harbor$162 million included expenditures relating to information technology, health and MGM Springfield, respectively,safety initiatives, and various room, remodels including the tower rooms at Mandalay Bay and the suites at Bellagio, construction of additional exhibit space at the Mandalay Bay Convention Center, construction of the Park Theatre, construction of The Park entertainment district, and restaurant, and entertainment venue remodels.


We additionally

Financing activities.Cash used in financing activities was $2.8 billion in 2021 compared to cash provided by financing activities of $2.1 billion in 2020. In 2021, we had other investing activities. Distributions from unconsolidated affiliates for 2017 consistednet repayments of debt of $1.3 billion, as further discussed below, distributed $324 million to noncontrolling interest owners, and we repurchased $1.8 billion of our $300common stock, partially offset by net proceeds received of $793 million sharefrom the issuance of a $600 million dividend paid by CityCenterMGP's Class A shares. In comparison, in April 2017.

During 2016,the prior year period, we received $15 million ofnet proceeds related tofrom the sale of a portion of our investment in the Las Vegas Arena Company, LLC, and we paid approximately $604 million and acquired cash of approximately $43 million in connection with the acquisition of Boyd Gaming’s ownership interest in Borgata. Distributions from unconsolidated affiliates for 2016 primarily related to a $540 million distribution paid by CityCenter in May 2016.

In 2015, investments in and advances to unconsolidated affiliates primarily represented investments in CityCenter pursuant to the completion guarantee of $141 million and investments in the Las Vegas Arena Company, LLC of $50 million. In 2015, investing activities also included proceeds of $20 million related to the sale of Railroad Pass and Gold Strike Jean, proceeds of $72 million (net of cash included in the sale) related to the sale of Circus Circus Reno and the Company’s 50% interest in Silver Legacy, and $202 million of distributions received from unconsolidated affiliates, which includes a $200 million distribution paid by CityCenter in April 2015. In addition, we invested $200 million in certificates of deposit with original maturities longer than 90 days and received proceeds of $770 million related to the maturity of certificates of deposit with original maturities longer than 90 days.


Financing activities. In 2017, we repaid net debt of $138 million which included the following repayments:

$503 million for the redemption of our $475 million 11.375% senior notes, including a premium;

$478 million for the repaymentincurrence of the MGM National Harbor credit facility, which consisted of $425 million in term loans and $53 million drawn on the revolving creditbridge loan facility in connection with the MGM National Harbor transaction;

$42MGP BREIT Venture Transaction of $1.3 billion, net proceeds of $525 million from MGP’s Class A share issuances, net debt borrowings of $1.1 billion, as further discussed below, repurchased $354 million of amortization paymentsour common stock, distributed $286 million to noncontrolling interest owners, and paid $78 million in dividends to our shareholders.


Borrowings and Repayments of Long-term Debt

In 2021, we had net repayments of debt of $1.3 billion, which consisted of the repayment of the $1.7 billion outstanding on the Operating Partnership seniorCityCenter's credit facility term loans;

$77in full, which was assumed in the acquisition, using cash on hand, and net repayments of $407 million of amortization payments on the MGM ChinaChina’s first revolving credit facility term loans; and

$13 million of amortization payments on our senior credit facility term loan.

Thefacility. These repayments were partially offset by MGM China’s March 2021 issuance of $750 million in aggregate principal amount of 4.75% senior notes due 2027 at an issue price of 99.97% and net draws of $40 million on the following issuancesOperating Partnership's revolving credit facility, of which $35 million was used in connection with MGP's acquisition of MGM Springfield with the remainder used to fund the Operating Partnership's and draws:

MGP's distribution and dividend payments. The net proceeds from MGM China’s 4.75% senior notes due 2027 issuance were used to partially repay amounts outstanding under the MGM China first revolving credit facility and for general corporate purposes.

$350

51

In 2020, we had net proceeds from the incurrence of the bridge loan facility in connection with the MGP BREIT Venture Transaction of $1.3 billion and net debt borrowings of $1.1 billion, which consisted of net borrowings on MGM China’s credit facility of $103 million, forour issuance of $750 million of 4.75% senior notes and $750 million of 6.75% senior notes, the Operating Partnership’s issuance of 4.50%$750 million of 3.875% senior notes due 2028 in connection with the MGM National Harbor transaction;

$135and $800 million of net draws on our4.625% senior secured revolving credit facility;

$462notes, and MGM China’s issuance of $500 million of net draws on5.25% senior notes, partially offset by the MGM China revolving credit facility; and

$28tender of $750 million of net draws on the MGM National Harbor revolving credit facility.

Additionally, we paid $10 million of debt issuance costs related to the issuance of the Operating Partnership’sour senior notes and the amendments tocorresponding $97 million of tender offer costs, and the MGM China andnet repayment of $1.7 billion on the Operating Partnership credit facilities.

In 2016, we repaid net debt of $301 million. In April 2016, in connection with the MGP IPO and related financing transactions we permanently repaid $2.7 billion under our priorPartnership's senior secured credit facility and entered into an amended and restated senior secured creditconsisting of the repayment of $1.3 billion of its term loan B facility underin full using the proceeds of the $1.3 billion bridge loan facility, which we borrowed $250 million. The Operating Partnership borrowedwas then assumed by MGP BREIT Venture, the repayment of its $399 million term loan A facility in full using the net debtproceeds from MGP’s settlement of $2.1 billion during 2016 under its senior credit facility. In addition, MGM National Harbor borrowed $450forward equity agreements, partially offset by a net draw of $10 million under its credit facility, MGM China borrowed $374 million underon its revolving credit facility, andfacility.


In March 2020, with certain of the proceeds from the MGP BREIT Venture Transaction, we permanently repaid $584completed cash tender offers for an aggregate amount of $750 million under Borgata’s credit facility. The followingof our senior notes, were issued during 2016:

$500comprised of $325 million principal amount of our outstanding 5.75% senior notes due 2025, $100 million principal amount of our outstanding 4.625% senior notes due 2026, issued by us;

$500and $325 million 4.5%principal amount of our outstanding 5.5% senior notes due 20262027.


In May 2020, we issued by the Operating Partnership; and

$1.05 billion 5.625%$750 million in aggregate principal amount of 6.750% senior notes due 2024 issued by2025. The proceeds were used to further increase our liquidity position.


In June 2020, the Operating Partnership.

We redeemed the following senior notes during 2016:

$743Partnership issued $800 million 7.625%in aggregate principal amount of 4.625% senior notes due 2017 at a premium;

2025. The proceeds were used to repay borrowings on the Operating Partnership’s senior credit facility, which were used to fund the May 2020 redemption of $700 million of Operating Partnership units held by us.

$732.7In June 2020, MGM China issued $500 million 7.5%in aggregate principal amount of 5.25% senior notes due 2016 at a premium;

$500 million 10% senior notes, due 2016 at a premium; and

$242.9 million 6.875% senior notes in April 2016 at maturity.

Additionally, we paid $140 million of debt issuance costs related2025. The proceeds were used to the senior notes issued in August 2016, the MGP financing transactions, the MGM National Harbor credit facility and the February 2016 amendment to the MGM China credit facility.

In 2015, we had net borrowings of $102 million, including $1.0 billion of borrowingspartially repay amounts outstanding under the MGM China credit facility and for general corporate purposes.


In October 2020, we issued $750 million in aggregate principal amount of 4.75% senior notes due 2028. The proceeds were used for general corporate purposes.

In November 2020, the repaymentOperating Partnership issued $750 million in aggregate principal amount of $283.875% senior notes due 2029. The proceeds were used for general corporate purposes, which included the December 2020 redemption of $700 million under our senior secured credit facility and the repayment of the $875 million 6.625% senior notes at maturity in July 2015 using cash on hand. Additionally, we paid $46 million of debt issuance costs relatedOperating Partnership units held by us.

Dividends, Distributions to the refinancing of the MGM China credit facility.

Other financing activities during the year ended 2017 included MGP’s receipt of net proceeds of $388 million from a secondary offering of its Class A shares issued in September 2017 in connection with the MGM National Harbor transaction. During the year ended 2016, MGP received proceeds of $1.2 billion in connection with the MGP IPO in April 2016Noncontrolling Interest Owners and paid $75 million of issuance costs related to the IPO, and we paid $100 million as part of the consideration for the purchase of an additional 188.1 million common shares of our MGM China subsidiary.

Additionally, in September 2017,Share Repurchases


In 2021, we repurchased and retired $328$1.8 billion of our common stock pursuant to our May 2018 $2.0 billion and February 2020 $3.0 billion stock repurchase programs. As a result of those repurchases, we completed our May 2018 $2.0 billion stock repurchase program, and the remaining availability under the February 2020 $3.0 billion stock repurchase program was $1.3 billion as of December 31, 2021. In 2020, we repurchased and retired $354 million of our common stock pursuant to our May 2018 $2.0 billion stock repurchase plan. As discussed further below,program.

In March 2021, June 2021, September 2021, and December 2021, we paid dividends to common shareholdersof $0.0025 per share, totaling $5 million for 2021. In March 2020, we paid a dividend of $0.15 per share, and in 2017June 2020, September 2020 and have made distributions to noncontrolling interests in each of 2017, 2016, and 2015.

We received $47 million and $6 million in 2016 and 2015, respectively, related to proceeds from the issuance of non-voting membership interests in MGM National Harbor. No non-voting membership interests in MGM National Harbor were issued in 2017.


Other Factors Affecting Liquidity

Anticipated uses of cash. We have significant outstanding debt and contractual obligations in addition to planned capital expenditures. At December 31, 2017, we had $13.0 billion in principal amount of indebtedness, including $373 million of borrowings outstanding under our $1.5 billion senior secured credit facility, $2.1 billion outstanding under the $2.7 billion Operating Partnership credit facility, and $2.3 billion outstanding under the $2.9 billion MGM China credit facility. In the next twelve months, we have due an estimated $710 million of cash interest payments and $820 million of term loan principal payments, of which approximately $774 million relates to MGM China’s existing credit facility. MGM China is in the process of amending its credit facility to extend the maturity date, extend the timing of and reduce the amount of scheduled amortization payments, and increase the maximum leverage ratio. We believe we have the ability to meet known obligations, including principal and interest obligations as well as planned capital expenditures, over the next twelve months from the balance sheet date with existing cash and cash deposits, cash flows from operations, and availability under our revolving credit facilities.

In addition, we have made significant investments through December 31, 2017 and we expect to make capital investments as described below during 2018. See “Executive Overview” for further information regarding the scope and timing of our significant development projects.

Approximately $640 million in capital expenditures at our domestic resorts and corporate entities, excluding MGM Springfield;

Approximately $455 million on the MGM Cotai project, excluding development fees and capitalized interest;

Approximately $375 million on the MGM Springfield project, excluding capitalized interest and land-related costs; and

Approximately $115 million in maintenance capital improvements at MGM China.

Our capital expenditures fluctuate depending on our decisions with respect to strategic capital investments in new or existing resorts and the timing of capital investments to maintain the quality of our resorts, the amounts of which can vary depending on timing of larger remodel projects related to our public spaces and hotel rooms. Future capital expenditures could vary from our current expectations depending on the progress of our development efforts and the structure of our ownership interests in future developments.

MGM Resorts International stock repurchase program. In September 2017, our Board of Directors authorized a $1.0 billion stock repurchase program, under which we may repurchase shares from time to time in the open market or in privately negotiated agreements. The timing, volume and nature of stock repurchases will be at the sole discretion of management, dependent on market conditions, applicable securities laws, and other factors, and may be suspended or discontinued at any time. Repurchased shares are retired. The remaining availability under the stock repurchase program was approximately $672 million as of December 31, 2017.

MGM Resorts International dividends. During 2017,2020, we paid dividends each quarter of $0.11$0.0025 per share, totaling $252$78 million for 2020.


In 2020, MGM China paid the year. On February 19, 2018 the Boardfinal dividend for 2019 of Directors approved a quarterly dividend to holders$41 million, of record on March 9, 2018 of $0.12 per share, totaling $68which we received $23 million which will be paid on March 15, 2018. Our intention is to pay a comparable quarterly dividend in each quarter of 2018, subject to our operating results, cash requirements and financial conditions, any applicable provisions of state law that may limit the amount of funds available to us, and compliance with covenants and financial ratios related to existing or future agreements governing the indebtedness at our subsidiaries and any limitations in other agreements such subsidiaries may have with third parties.

Operating Partnership distributions and MGP dividends. noncontrolling interests received $18 million.


The Operating Partnership paid the following distributions to its partnership unit holders:

holders during 2021 and 2020:

•$112545 million distributionof distributions paid in January 2018,2021, of which the Companywe received $82$243 million and MGP received $30received $302 million, which MGP concurrently paid as a dividend to its Class A shareholders;

and

•$385602 million of distributions paid in 2017,2020, of which the Companywe received $290$358 million and MGP received $95$244 million, which MGP concurrently paid as a dividend to its Class A shareholders;

shareholders.

Other Factors Affecting Liquidity and Anticipated Uses of Cash

As previously discussed, the spread of COVID-19 and developments surrounding the global pandemic have had a significant impact on our business, financial condition, results of operations, and cash flows in 2020 and 2021 and may continue to impact our business in 2022 and thereafter. We require a certain amount of cash on hand to operate our resorts.
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In addition to required cash on hand for operations, we utilize corporate cash management procedures to minimize the amount of cash held on hand or in banks. Funds are swept from the accounts at most of our domestic resorts daily into central bank accounts, and excess funds are invested overnight or are used to repay amounts drawn under our revolving credit facility. In addition, from time to time we may use excess funds to repurchase our outstanding debt and equity securities subject to limitations in our revolving credit facility and Delaware law, as applicable. We have significant outstanding debt, interest payments, rent payments, and contractual obligations in addition to planned capital expenditures and commitments, including acquiring the operations of The Cosmopolitan for cash consideration of $1.625 billion, as discussed further in Note 1.


As of December 31, 2021, we had cash and cash equivalents of $4.7 billion, of which MGM China held $399 million and the Operating Partnership held $8 million. In addition to our cash and cash equivalent balance, we have significant holdings: a 41.5% economic interest in MGP (refer to Note 1 for discussion on our agreement entered into in August 2021 regarding the VICI Transaction) and an approximate 56% interest in MGM China.

At December 31, 2021, we had $12.9 billion in principal amount of indebtedness, including $360 million outstanding under the $1.25 billion MGM China first revolving credit facility and $50 million outstanding under the $1.35 billion Operating Partnership revolving credit facility. No amounts were drawn on our $1.675 billion revolving credit facility or the $400 million MGM China second revolving credit facility. We have $1.0 billion of debt maturing in the next twelve months, which we expect to repay with cash on hand.

Due to the continued impact of the COVID-19 pandemic, in February 2021, MGM China further amended each of its first revolving credit facility and its second revolving credit facility to provide for waivers of the maximum leverage ratio and minimum interest coverage ratio through the fourth quarter of 2022. In February 2022, MGM China further amended each of its first revolving credit facility and its second revolving credit facility to extend the financial covenant waivers through maturity.

As of December 31, 2021, our expected cash interest payments, excluding MGP and MGM China, for 2022, 2023, and 2024 are approximately $300 million, $225 million, and $190 million, respectively, and our expected cash interest payments on a consolidated basis, which includes MGP if the VICI Transaction does not close and MGM China, for 2022, 2023, and 2024, are approximately $715 million, $625 million, and $585 million, respectively. We are also required as of December 31, 2021 to make annual cash rent payments of $1.6 billion, in the aggregate, under the triple-net lease agreements, which leases are also subject to annual escalators and also require us to pay substantially all costs associated with the lease, including real estate taxes, ground lease payments, insurance, utilities and routine maintenance, in addition to the annual cash rent.

We have planned capital expenditures in 2022 of approximately $775 million to $815 million domestically and approximately $110 million to $130 million at MGM China, which is inclusive of the capital expenditures required under the triple-net lease agreements, each of which requires us to spend a specified percentage of net revenues, at the respective properties, on capital expenditures. We additionally have planned contributions to BetMGM in 2022 of approximately $225 million.

We also expect to continue to repurchase shares pursuant to our February 2020 $3.0 billion share repurchase program. Subsequent to December 31, 2021, we repurchased approximately 15 million shares of our common stock at an average price of $15143.88 per share for an aggregate amount of $670 million. Repurchased shares were retired.

In January 2022, the Operating Partnership paid $141 million of distributions paid in 2016,to its partnership unit holders, of which the Companywe received $113$59 million and MGP received $38$82 million, which MGP concurrently paid as a dividend to its Class A shareholders.


MGM China dividends. MGM China paid, or

On February 9, 2022, our Board of Directors approved a quarterly dividend of $0.0025 per share. The dividend will pay,be payable on March 15, 2022 to holders of record on March 10, 2022. Future determinations regarding the followingdeclaration and payment of dividends, to its shareholders:

$47 million dividend, toif any, will be paid in 2018 if approved at the MGM China 2018 annual shareholders meeting, of which the Company would receive $26 million and noncontrolling interests would receive $21 million;

$134 million of dividends paid in 2017, of which the Company received $75 million and noncontrolling interests received $59 million;


•

$104 million of dividends paid in 2016, of which the Company received $53 million and noncontrolling interests received $51 million;

$596 million of dividends paid in 2015, of which the Company received $304 million and noncontrolling interests received $292 million.

During 2017, we paid $7 milliondiscretion of our shareboard of MGM China’s dividenddirectors and will depend on then-existing conditions, including our results of operations, financial condition, and other factors that our Board of Directors may deem relevant.


As previously discussed, the COVID-19 pandemic has caused, and is continuing to Grand Paradise Macau (“GPM”) under a deferred cash payment arrangement. See Note 12cause, significant economic disruption both globally and in the accompanying consolidatedUnited States, and impacted our business, financial statements forcondition, results of operations and cash flows in 2020 and 2021 and may continue to impact our business in 2022 and thereafter. As widespread vaccine distribution continues and operational restrictions have been removed, we have seen economic recovery in some of the market segments in which we operate, as shown in our Summary Operating Results. However, some areas continue to experience renewed outbreaks and surges in infection rates. As a result, our business segments continue to face many uncertainties and our operations remain vulnerable to reversal of these trends or other continuing negative effects caused by
53

the pandemic. We cannot predict the degree, or duration, to which our operations will be affected by the COVID-19 pandemic, and the effects could be material. We continue to monitor the evolving situation and guidance from international and domestic authorities, including federal, state and local public health authorities and may take additional actions based on their recommendations. In these circumstances, there may be developments outside our control requiring us to further adjust our operating plan, including the implementation or extension of new or existing restrictions, which may include the reinstatement of stay-at-home orders in the jurisdictions in which we operate or additional restrictions on travel and/or our business operations. Because the situation is ongoing, and because the duration and severity remain unclear, it is difficult to forecast any impacts on our future results.

For additional information regardingrelated to our long-term obligations, refer to the deferred cash payment arrangement.

maturities of long-term debt table in Note 9 and the lease liability maturity table in Note 11.


Principal Debt Arrangements


See Note 109 to the accompanying consolidated financial statements for information regarding our debt agreements as of December 31, 2017.

Off Balance Sheet Arrangements

Our off-balance sheet arrangements consist primarily of investments in unconsolidated affiliates, which consist primarily of our investments in CityCenter, Grand Victoria, and Las Vegas Arena Company, LLC. We have not entered into any transactions with special purpose entities, nor have we engaged in any derivative transactions, other than the Operating Partnership’s cash flow hedges. See Note 10 to the accompanying consolidated financial statements for additional information. Our unconsolidated affiliate investments allow us to realize the proportionate benefits of owning a full-scale resort or other entertainment facilities in a manner that minimizes our initial investment. We guarantee the T-Mobile Arena credit facility as described in Item 2 – Properties. In addition, there are no other provisions in the agreements with our investees which we believe are unusual or subject us to risks to which we would not be subjected if we had full ownership of the resort.

Commitments and Contractual Obligations

The following table summarizes our scheduled contractual obligations as of December 31, 2017:

 

 

2018

 

 

2019

 

 

2020

 

 

2021

 

 

2022

 

 

Thereafter

 

 

Total

 

 

 

(In millions)

 

Long-term debt (1)

 

$

820

 

 

$

2,424

 

 

$

1,546

 

 

$

1,832

 

 

$

1,018

 

 

$

5,378

 

 

$

13,018

 

Estimated interest payments on long-term debt (2)

 

 

710

 

 

 

583

 

 

 

548

 

 

 

443

 

 

 

315

 

 

 

276

 

 

 

2,875

 

Construction commitments

 

 

295

 

 

 

7

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

302

 

Operating leases (3)

 

 

39

 

 

 

36

 

 

 

34

 

 

 

35

 

 

 

32

 

 

 

1,360

 

 

 

1,536

 

Other Long-term liabilities (4)

 

 

—

 

 

 

46

 

 

 

—

 

 

 

7

 

 

 

7

 

 

 

63

 

 

 

123

 

Other purchase obligations (5)

 

 

84

 

 

 

21

 

 

 

18

 

 

 

17

 

 

 

17

 

 

 

101

 

 

 

258

 

 

 

$

1,948

 

 

$

3,117

 

 

$

2,146

 

 

$

2,334

 

 

$

1,389

 

 

$

7,178

 

 

$

18,112

 

(1)

Refer to Note 10 for further information on long-term debt.

2021.

(2)

Estimated interest payments, adjusted for the impact of interest rate swap agreements, are based on principal amounts and expected maturities of debt outstanding at December 31, 2017 and management’s forecasted LIBOR rates for our senior credit facility and HIBOR rates for the MGM China credit facility.


(3)

Refer to Note 12 for further information on operating leases.

(4)

Reflects future expected cash outlays of our other long-term liabilities recorded on our balance sheet as of December 31, 2017, and, accordingly, we have not included such liabilities above that do not have future cash payments, such as deferred rent. We have also excluded deferred income tax liabilities and unrecognized tax benefits from the amounts presented in the table as the amounts that will be settled in cash are not known and the timing of any payments is uncertain.

(5)

Our purchase obligations represent minimum obligations we have under agreements with certain of our vendors, primarily utility and entertainment contracts. Also, although open purchase orders are considered enforceable and legally binding, the terms generally allow us the option to cancel, reschedule, and adjust our requirements based on our business needs prior to the delivery of goods or performance of services, and hence, have not been included in the table above.

Critical Accounting Policies and Estimates


Management’s discussion and analysis of our results of operations and liquidity and capital resources are based on our consolidated financial statements. To prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, we must make estimates and assumptions that affect the amounts reported in the consolidated financial statements. We regularly evaluate these estimates and assumptions, particularly in areas we consider to be critical accounting estimates, where changes in the estimates and assumptions couldinvolve a significant level of estimation uncertainty and have had or are reasonably likely to have a material effect on our financial condition or results of operations, financial position or cash flows. Senior management and the Audit Committee of the Board of Directors have reviewed the disclosures included herein about our critical accounting estimates, and have reviewed the processes to determine those estimates.operations. However, by their nature, judgments are subject to an inherent degree of uncertainty and therefore actual results can differ from our estimates.



Allowance

Loss Reserve for Doubtful Casino Accounts Receivable


Marker play represents a significant portion of the table games volume at certain of our Las Vegas resorts. Our other casinos do not emphasize marker play to the same extent, although we offer markers to customers at those casinos as well. MGM China extends credit to certain in-house VIP gaming customers and, historically, to gaming promoters. We maintain strict controls over the issuance of markers and aggressively pursue collection from our customers who fail to pay their marker balances timely. These collection efforts are similar to those used by most large corporations when dealing with overdue customer accounts, including the mailing of statements and delinquency notices, personal contacts, the use of outside collection agencies and civil litigation. Markers are generally legally enforceable instruments in the United States and Macau. Markers are not legally enforceable instruments in some foreign countries, but the United States assets of foreign customers may be reached to satisfy judgments entered in the United States. We consider the likelihood and difficulty of enforceability, among other factors, when we issue credit to customers at our domestic resorts who are not residents of the United States. MGM China performs background checks and investigates the credit worthiness of gaming promoters and casino customers prior to issuing credit. At December 31, 2017 and 2016, approximately 60% and 49%, respectively,Refer to Note 2 for further discussion of our gross casino accounts receivable were owed byreceivables and those due from customers from the United States.

residing in foreign countries.


We maintain an allowance, ora loss reserve for doubtful casino accounts at all of our operating casino resorts. The provision for doubtful accounts, an operating expense, increases the allowance for doubtful accounts.loss reserve. We regularly evaluate the allowanceloss reserve for doubtful casino accounts. At domestic resorts where marker play is not significant, the allowanceloss reserve is generally established by applying standard reserve percentages to aged account balances.balances, which is supported by relevant historical analysis and any other known information such as the current economic conditions that could drive losses. At domestic resorts where marker play is significant, we apply standard reserve percentages to aged account balances under a specified dollar amount and specifically analyze the collectability of each account with a balance over the specified dollar amount, based on the age of the account, the customer’s current and expected future financial condition, collection history and any other known information.current and expected future economic conditions. MGM China specifically analyzes the collectability of casino receivables on an individual basis taking into account the age of the account, the financial condition and the collection history of the customer or, historically, the gaming promoter or casino customer.

promoter.


In addition to enforceability issues, the collectability of unpaid markers given by foreign customers at our domestic resorts is affected by a number of factors, including changes in currency exchange rates and economic conditions in the customers’ home countries. Because individual customer account balances can be significant, the allowanceloss reserve and the provision can change significantly between periods, as information about a certain customer becomes known or as changes in a region’s economy occur.

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The following table shows key statistics related to our casino receivables, net of discounts:

 

 

 

December 31,

 

 

 

 

2017

 

 

2016

 

 

 

 

(In thousands)

 

 

Casino receivables

 

$

343,869

 

 

$

332,443

 

 

Allowance for doubtful casino accounts receivable

 

 

86,126

 

 

 

92,424

 

 

Allowance as a percentage of casino accounts receivable

 

 

25

%

 

 

28

%

 December 31,
 20212020
 (In thousands)
Casino receivables$380,907$260,998
Loss reserve for casino accounts receivable117,539107,723
Loss reserve as a percentage of casino accounts receivable31 %41 %


Approximately $31$63 million and $35$54 million of casino receivables and $7$31 million and $8$18 million of the allowanceloss reserve for doubtful casino accounts receivable relate to MGM China at December 31, 20172021 and 2016,2020, respectively. The allowance for doubtful accountsloss reserve as a percentage of casino accounts receivable has decreased in the current year due to a decrease in specific reserves at our domestic resorts, as well as the inclusion of Aria in the current year, which had a lower loss reserve compared to our other domestic resorts due to the age of its outstanding account balances.receivables, partially offset by an increase in the loss reserve at MGM China primarily due to an increase in its specific reserves. At December 31, 2017,2021, a 100 basis-point change in the allowance for doubtful accountsloss reserve as a percentage of casino accounts receivable would change income before income taxes by $3$4 million.


Fixed Asset Capitalization and Depreciation Policies


Property and equipment are stated at cost. A significant amount of our property and equipment was acquired through business combinations and was therefore recognized at fair value at the acquisition date. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Depreciation and amortization are provided on a straight-line basis over the estimated useful lives of the assets. When we construct assets, we capitalize direct costs of the project, including fees paid to architects and contractors, property taxes, and certain costs of our design and construction subsidiaries. In addition, interest cost associated with major development and construction projects is capitalized as part of the cost of the project. Interest is typically capitalized on amounts expended on the project using the weighted-averageweighted average cost of our outstanding borrowings. Capitalization of interest starts when construction activities begin and ceases when construction is substantially complete, or development activity is suspended for more than a brief period.



We must make estimates and assumptions when accounting for capital expenditures. Whether an expenditure is considered a maintenance expense, or a capital asset is a matter of judgment. When constructing or purchasing assets, we must determine whether existing assets are being replaced or otherwise impaired, which also may be a matter of judgment. In addition, our depreciation expense is highly dependent on the assumptions we make about our assets’ estimated useful lives. We determine the estimated useful lives based on our experience with similar assets, engineering studies, and our estimate of the usage of the asset. Whenever events or circumstances occur which change the estimated useful life of an asset, we account for the change prospectively.


Impairment of Long-lived Assets, Goodwill and Indefinite-lived Intangible Assets


We evaluate our property and equipment and other long-lived assets for impairment based on our classification as held for sale or to be held and used. Several criteria must be met before an asset is classified as held for sale, including that management with the appropriate authority commits to a plan to sell the asset at a reasonable price in relation to its fair value and is actively seeking a buyer. For assets classified as held for sale, we recognize the asset at the lower of carrying value or fair market value less costs of disposal, as estimated based on comparable asset sales, offers received, or a discounted cash flow model. For assets to be held and used, we review for impairment whenever indicators of impairment exist. We then compare the estimated future cash flows of the asset, on an undiscounted basis, to the carrying value of the asset. If the undiscounted cash flows exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying value, then an impairment is recorded based on the fair value of the asset. For operating assets, fair value is typically measured using a discounted cash flow model whereby future cash flows are discounted using a weighted-averageweighted average cost of capital, developed using a standard capital asset pricing model, based on guideline companies in our industry. If an asset is still under development, future cash flows include remaining construction costs. All recognized impairment losses, whether for assets to be held for sale or assets to be held and used, are recorded as operating expenses.


There are several estimates, assumptions and decisions in measuring impairments of long-lived assets. First, management must determine the usage of the asset. To the extent management decides that an asset will be sold, it is more likely that an impairment may be recognized. Assets must be tested at the lowest level for which identifiable cash flows exist. This means that some assets must be grouped, and management has some discretion in the grouping of assets. Future cash flow estimates are, by their nature, subjective and actual results may differ materially from our estimates.

55


On a quarterly basis, we review our major long-lived assets to determine if events have occurred or circumstances exist that indicate a potential impairment. Potential factors which could trigger an impairment include underperformance compared to historical or projected operating results, negative industry or economic factors, significant changes to our operating environment, or changes in intended use of the asset group. We estimate future cash flows using our internal budgets and probability weight cash flows in certain circumstances to consider alternative outcomes associated with recoverability of the asset group, including potential sale. Historically, undiscounted cash flows of our significant operating asset groups have exceeded their carrying values by a substantial margin.

During 2019, we recorded a non-cash impairment charge relating to the carrying value of Circus Circus Las Vegas and adjacent land. Refer to Note 16 for further discussion.


We review indefinite-lived intangible assets at least annually and between annual test dates in certain circumstances. We perform our annual impairment test for indefinite-lived intangible assets in the fourth quarter of each fiscal year. Indefinite-lived intangible assets consist primarily of license rights and trademarks. For our 20172021 annual impairment test,tests, we utilized the option to perform a qualitative (“step zero”) analysis for certain of our indefinite-lived intangibles and concluded it was more likely than not that the fair values of such intangibles exceeded their carrying values by a substantial margin. We elected to perform a quantitative analysis for the Borgata trade nameMGM Northfield Park gaming license in 2021 primarily using athe discounted cash flow approach, for which the fair value exceeded its carrying value by approximately 4%. For our 2016 and 2015 annual impairment tests we utilized the two-step quantitative analysis for all of our intangible assets, using a discounted cash flow approach for license rights and using the relief-from-royalty method for trademarks. The estimated fair values of the intangibles were substantially in excess of their carrying values, with the fair value of the Borgata trade name exceeding its carrying value by approximately 2%, reflecting the recentness of the Borgata Transaction.substantial margin. As discussed below, management makes significant judgments and estimates as part of these analyses. If certain future operating results do not meet current expectations it could cause carrying values of the intangibles to exceed their fair values in future periods, potentially resulting in an impairment charge.


We review goodwill at least annually and between annual test dates in certain circumstances. With the exceptionNone of our MGM China reporting unit, discussed below, none of our other reporting units incurred any goodwill impairment charges in 2017, 2016 or 2015.2021. For our 2017 annual goodwill impairment tests, we utilized the option to perform a step zero analysis for all of our domestic resorts reporting units and concluded it was more likely than not that the fair values of such reporting units exceeded their carrying values. We utilized the quantitative analysis for the MGM China reporting unit, for which the fair value of such reporting unit exceeded its carrying value by a substantial margin. For our 20162021 annual impairment tests, we utilized the option to perform a step zero analysis for certain of our domestic resorts reporting units and concluded it was more likely than not that the fair values of such reporting units exceeded their carrying values by a substantial margin. The estimated fair values of reporting units for which we elected to forego the step zero analysis and instead utilized the two-step quantitative analysis were substantially in excess of their carrying values. As discussed below, management makes significant judgments and estimates as part of these analyses. If future operating results of our reporting units do not meet current expectations it could cause carrying values of our reporting units to exceed their fair values in future periods, potentially resulting in a goodwill impairment charge.



During the fourth quarter of 2015 we conducted our annual impairment tests of goodwill by reviewing each of our reporting units, including our MGM China reporting unit. The step one goodwill analysis of the MGM China reporting unit indicated the fair value was less than its carrying value by 4%. The decrease in fair value resulted from a decrease in forecasted cash flows based on then current market conditions and a sustained decline in the enterprise value multiples of the MGM China reporting unit as well as those of the MGM China reporting unit’s peer group. As a result of the indication of impairment from the step one analysis, we proceeded to perform a step two impairment analysis to measure the impairment loss. As such, we determined the fair values of all assets of the MGM China reporting unit, including its separately identifiable intangible assets. The fair values of each of the separately identifiable intangible assets exceeded their respective carrying values by a significant amount, leading to a lower implied fair value of goodwill. Therefore, we recorded a $1.5 billion non-cash impairment charge to reduce the historical carrying value of goodwill related to the MGM China reporting unit to its implied fair value in 2015.

There are several estimates inherent in evaluating these assets for impairment. In particular, future cash flow estimates are, by their nature, subjective and actual results may differ materially from our estimates. In addition, the determination of multiples, capitalization rates and the discount rates used in the impairment tests are highly judgmental and dependent in large part on expectations of future market conditions.


See Note 2 and Note 87 to the accompanying consolidated financial statements for further discussion of goodwill and other intangible assets.


Impairment of Investments in Unconsolidated Affiliates


See Note 7 and Note 162 to the accompanying consolidated financial statements for discussion of our evaluation of other-than-temporary impairment.

impairment of investments in unconsolidated affiliates. During 2021 and 2020, we recorded $22 million and $64 million, respectively, in other-than-temporary impairment charges on equity method investments. Refer to Note 6 for further discussion. Our investments in unconsolidated affiliates had no material impairments in 2019.


Income Taxes


We recognize deferred tax assets, net of applicable reserves, relatedare subject to net operating loss and tax credit carryforwards and certain temporary differences with a future tax benefit to the extent that realization of such benefit is more likely than not. Otherwise, a valuation allowance is applied.

We file income tax returnstaxes in the U.S. federal jurisdiction, various state and local jurisdictions, and foreign jurisdictions, although the income taxes paid in foreign jurisdictions are not material. Our


We recognize deferred tax assets and liabilities related to net operating losses, tax credit carryforwards and temporary differences with future tax consequences. We reduce the carrying amount of deferred tax assets by a valuation allowance if it is more likely than not such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed at each reporting period based on such "more-likely-than-not" realization threshold. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the scheduled reversal of deferred tax liabilities, the duration of statutory carryforward periods, and tax planning strategies.

We recorded a valuation allowance on the net deferred tax assets of our domestic jurisdictions of $2.7 billion as of both December 31, 2021 and 2020, and a valuation allowance on certain net deferred tax assets of foreign jurisdictions of $149 million and $156 million as of December 31, 2021 and 2020, respectively. We reassess the realization of deferred tax assets each reporting period. In the event we were to determine that it is more likely than not that we will be unable to
56

realize all or part of our deferred tax assets in the future, we would increase the valuation allowance and recognize a corresponding charge to earnings or other comprehensive income in the period in which we make such a determination. Likewise, if we later determine that we are more likely than not to realize the deferred tax assets, we would reverse the applicable portion of the previously recognized valuation allowance. In order for us to realize our deferred tax assets, we must be able to generate sufficient taxable income in the jurisdictions in which the deferred tax assets are located.

Furthermore, we are subject to routine corporate income tax audits in many of these jurisdictions. We believe that positions taken on our tax returns are subject tofully supported, but tax authorities may challenge these positions, which may not be fully sustained on examination by the Internal Revenue Service (“IRS”) and otherrelevant tax authorities. Positions taken in tax returns are sometimes subject to uncertainty in the tax laws and may not ultimately be accepted by the IRS or other tax authorities. See Note 11 in the accompanying consolidated financial statements for a discussion of the status and impact of examinations by tax authorities.

We assessAccordingly, our tax positions using a two-step process. A tax position is recognized if it meets a “more likely than not” threshold, and is measured at the largest amount of benefit that is greater than fifty percent likely of being realized. Uncertain tax positions must be reviewed at each balance sheet date. Liabilities we record as a result of this analysis are recorded separately from any current or deferred income tax accounts, and are classified as current in “Other accrued liabilities” or long-term in “Other long-term liabilities” based onprovision includes amounts intended to satisfy assessments that may result from these challenges. Determining the time until expected payment. Additionally, we recognize accrued interest and penalties, if any, related to unrecognized tax benefits in income tax expense.

provision for these potential assessments and recording the related effects requires management judgments and estimates. The amounts ultimately paid on resolution of an audit could be materially different from the amounts previously included in our income tax provision and, therefore, could have a material impact on our income tax provision, net income and cash flows.


Refer to Note 1110 in the accompanying consolidated financial statements for further discussion relating to income taxes.


ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk


In addition to the inherent risks associated with our normal operations, we are also exposed to additional market risks. Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates and foreign currency exchange rates. Our primary exposure to market risk is interest rate risk associated with our variable rate long-term debt. We attempt to limit our exposure to interest rate risk by managing the mix of our long-term fixed rate borrowings and short-term borrowings under our bank credit facilities and by utilizing interest rate swap agreements that provide for a fixed interest payment on the Operating Partnership’s term loan Bcredit facility. A change in interest rates generally does not have an impact upon our future earnings and cash flow for fixed-rate debt instruments. As fixed-rate debt matures, however, and if additional debt is acquired to fund the debt repayment, future earnings and cash flow may be affected by changes in interest rates. This effect would be realized in the periods subsequent to the periods when the debt matures. We do not hold or issue financial instruments for trading purposes and do not enter into derivative transactions that would be considered speculative positions.

positions.

As of December 31, 2017,2021, variable rate borrowings represented approximately 27%3% of our total borrowings after giving effect toon the $500 million and $700 millionOperating Partnership’s borrowings for the currently effective interest rate swap agreements on which the Operating Partnership pays a weighted average of 1.783% on a total notional amount of $700 million. Additionally, the Operating Partnership interest ratehas $900 million of notional amount of forward starting swaps with weighted average fixed rates that we pay 1.764% and 1.901%, respectively.are not currently effective. The following table provides additional information about the maturities of our gross long-term debt subject to changes in interest rates, excluding the effect of the Operating Partnership interest rate swaps discussed above:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value

 

 

Debt maturing in,

 

 

December 31,

 

 Debt maturing inFair Value December 31, 2021

 

2018

 

 

2019

 

 

2020

 

 

2021

 

 

2022

 

 

Thereafter

 

 

Total

 

 

2017

 

 20222023202420252026ThereafterTotal

 

(In millions)

 

 (In millions except interest rates)

Fixed-rate

 

$

—

 

 

$

850

 

 

$

1,500

 

 

$

1,250

 

 

$

1,000

 

 

$

3,653

 

 

$

8,253

 

 

$

8,855

 

Fixed-rate$1,000 $1,250 $1,800 $2,725 $1,650 $4,026 $12,451 $12,948 

Average interest rate

 

N/A

 

 

 

8.6

%

 

 

6.3

%

 

 

6.6

%

 

 

7.8

%

 

 

5.4

%

 

 

6.3

%

 

 

 

 

Average interest rate7.8 %6.0 %5.5 %5.6 %5.2 %4.9 %5.5 % 

Variable rate

 

$

820

 

 

$

1,574

 

 

$

46

 

 

$

582

 

 

$

18

 

 

$

1,725

 

 

$

4,765

 

 

$

4,770

 

Variable rate$— $50 $360 $— $— $— $410 $410 

Average interest rate

 

 

3.7

%

 

 

3.6

%

 

 

4.0

%

 

 

4.0

%

 

 

3.8

%

 

 

3.8

%

 

 

3.8

%

 

 

 

 

Average interest rateN/A1.9 %3.0 %N/AN/AN/A2.8 % 


In addition to the risk associated with our variable interest rate debt, we are also exposed to risks related to changes in foreign currency exchange rates, mainly related to MGM China and to our operations at MGM Macau and the development of MGM Cotai. While recent fluctuations in exchange rates have not been significant, potential changes in policy by governments or fluctuations in the economies of the United States, China, Macau or Hong Kong could cause variability in these exchange rates. We cannot assure you that the Hong Kong dollar will continue to be pegged to the U.S. dollar or the current peg rate for the Hong Kong dollar will remain at the same level. The possible changes to the peg of the Hong Kong dollar may result in severe fluctuations in the exchange rate thereof. For U.S. dollar denominated debt incurred by MGM China, fluctuations in the exchange rates of the Hong Kong dollar in relation to the U.S. dollar could have adverse effects on our financial position and results of operations. As of December 31, 2017,2021, a 1% increase inweakening of the Hong Kong dollar (the functional currency of MGM China) to the U.S. dollar exchange rate would impact the carrying value of our cash balance by $7 million and a 1% decrease in the exchange rate would impact the carrying value of our debt balance by $23 million.

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We incorporate by reference the information appearing under “Market Risk” in Item 7 of this Form 10-K.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Our financial statements and supplementary data required by this Item 8 are included at the end of this report as listed on Item 15.  

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.

CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer) have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“the Exchange Act”)) were effective as of December 31, 2017 to provide reasonable assurance that information required to be disclosed in the Company’s reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and regulations and to provide that such information is accumulated and communicated to management to allow timely decisions regarding required disclosures. This conclusion is based on an evaluation as required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act conducted under the supervision and participation of the principal executive officer and principal financial officer along with company management.

Changes in Internal Control over Financial Reporting

During the quarter ended December 31, 2017, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


Management’s Annual Report on Internal Control over Financial Reporting

Management’s Annual Report on Internal Control Over Financial Reporting, referred to in Item 15(a)(1) of this Form 10-K, is included at page 63 of this Form 10-K.

Attestation Report of the Independent Registered Public Accounting Firm

The Independent Registered Public Accounting Firm’s Attestation Report on our internal control over financial reporting referred to in Item 15(a)(1) of this Form 10-K, is included at page 64 of this Form 10-K.

ITEM 9B.  

OTHER INFORMATION

On February 23, 2018, the Compensation Committee of the Board of Directors approved a special cash bonus award to each of Mr. Murren, Mr. Baldwin, Mr. Hornbuckle, Mr. Sanders and Mr. D’Arrigo of $833,000, $333,000, $500,000, $500,000 and $333,000, respectively. The Compensation Committee approved these one-time awards in recognition of the extraordinary leadership efforts displayed by each of the executives during 2017. The Company paid these amountsresult in a lump sum in February 2018.

Because this report is being filed within four business days from the dateforeign currency transaction loss of the reportable event, we have made the foregoing disclosure in this report rather than in a Form 8-K under Item 5.02 (Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers)$28 million.


57

PART III

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

We incorporate by reference the information appearing under “Executive Officers of the Registrant” in Item 1 of this Form 10-K and under “Election of Directors” and “Corporate Governance” in our definitive Proxy Statement for our 2018 Annual Meeting of Stockholders, which we expect to file with the SEC on or before April 2, 2018 (the “Proxy Statement”).

ITEM 11.

EXECUTIVE COMPENSATION


We incorporate by reference the information appearing under “Director Compensation” and “Executive Compensation” and “Corporate Governance — Compensation Committee Interlocks and Insider Participation” and “Compensation Committee Report” in the Proxy Statement.

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

We incorporate by reference the information appearing under “Principal Stockholders” and “Election of Directors” in the Proxy Statement.

Equity Compensation Plan Information

The following table includes information about our equity compensation plans at December 31, 2017:

 

 

Securities to be issued

 

 

Weighted average

 

 

Securities available for

 

 

 

upon exercise of

 

 

exercise price of

 

 

future issuance under

 

 

 

outstanding options,

 

 

outstanding options,

 

 

equity compensation

 

 

 

warrants and rights

 

 

warrants and rights

 

 

plans

 

 

 

(In thousands, except per share data)

 

Equity compensation plans approved by

   security holders (1)

 

 

14,945

 

 

$

20.59

 

 

 

20,869

 

Equity compensation plans not approved by

   security holders

 

 

—

 

 

 

—

 

 

 

—

 

(1)

As of December 31, 2017 we had 2.6 million restricted stock units and 3.6 million performance share units outstanding that do not have an exercise price; therefore, the weighted average per share exercise price only relates to outstanding stock appreciation rights. The amount included in the securities outstanding above for performance share units assumes that each target price is achieved.

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

We incorporate by reference the information appearing under “Transactions with Related Persons” and “Corporate Governance” in the Proxy Statement.

ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

We incorporate by reference the information appearing under “Selection of Independent Registered Public Accounting Firm” in the Proxy Statement.


PART IV

ITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES


(a)(1).

Financial Statements.

Included in Part II of this Report:

Management’s Annual Report on Internal Control Over Financial Reporting

Statements:

63

64

59

Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements

65

66

62

Years Ended December 31, 2017, 20162021, 2020 and 2015

2019

Consolidated Statements of Operations

67

63

Consolidated Statements of Comprehensive Income (Loss)

68

64

Consolidated Statements of Cash Flows

69

65

Consolidated Statements of Stockholders’ Equity

70

66

71

67

Audited consolidated financial statements for CityCenter Holdings, LLC as of and for the three years in the period ended December 31, 2017 are presented in Exhibit 99.3 and are incorporated herein by reference.


Financial Statement Schedule:

(a)(2).

Financial Statement Schedule.

Years Ended December 31, 2017, 2016 and 2015

Schedule II — Valuation and Qualifying Accounts

113

107

We

The financial information included in the financial statement schedule should be read in conjunction with the consolidated financial statements. All other financial statement schedules have been omitted schedules other than the one listed above because they are not required or are not applicable, or the required information is shownincluded in the Consolidated Financial Statements or Notes to Consolidated Financial Statements.

(a)(3).

Exhibits.

Exhibit
Number

Description

2.1

Master Contribution Agreement by and among the Company, MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP, dated as of April 25, 2016 (incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).

3.1

Amended and Restated Certificate of Incorporation of the Company, dated June 14, 2011 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2011).

3.2

Amended and Restated Bylaws of the Company, effective January 13, 2016 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on January 15, 2016).

4.1(1)

Indenture, dated February 1, 1996, by and between Mandalay and First Interstate Bank of Nevada, N.A., as Trustee (the “Mandalay February 1996 Indenture”) (incorporated by reference to Exhibit 4(b) to Mandalay’s Current Report on Form 8-K filed on February 13, 1996).

4.1(2)

Supplemental Indenture, dated as of November 15, 1996, by and between Mandalay and Wells Fargo Bank (Colorado), N.A., (successor to First Interstate Bank of Nevada, N.A.), as Trustee, to the Mandalay February 1996 Indenture, with respect to $150 million aggregate principal amount of 6.70% Senior Notes due 2096 (incorporated by reference to Exhibit 4(c) to Mandalay’s Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 1996 (the “Mandalay October 1996 10-Q”)).

4.1(3)

6.70% Senior Notes due February 15, 2096 in the principal amount of $150,000,000 (incorporated by reference to Exhibit 4(d) to the Mandalay October 1996 10-Q).

4.1(4)

Indenture, dated November 15, 1996, by and between Mandalay and Wells Fargo Bank (Colorado), N.A., as Trustee (the “Mandalay November 1996 Indenture”) (incorporated by reference to Exhibit 4(e) to the Mandalay October 1996 10-Q).


4.1(5)

Supplemental Indenture, dated as of November 15, 1996, to the Mandalay November 1996 Indenture, with respect to $150 million aggregate principal amount of 7.0% Senior Notes due 2036 (incorporated by reference to Exhibit 4(f) to the Mandalay October 1996 10-Q).

4.1(6)

7.0% Senior Notes due February 15, 2036, in the principal amount of $150,000,000 (incorporated by reference to Exhibit 4(g) to the Mandalay October 1996 10-Q).

4.1(7)

Indenture, dated as of January 17, 2012, among the Company, the guarantors named therein and U.S. Bank National Association, as Trustee with respect to $850 million aggregate principal amount of 8.625% Senior Notes due 2019 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on January 17, 2012).

4.1(8)

Indenture, dated March 22, 2012, between the Company and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 22, 2012).

4.1(9)

First Supplemental Indenture, dated March 22, 2012, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee with respect to $1.0 billion aggregate principal amount of 7.75% senior notes due 2022 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on March 22, 2012).

4.1(10)

Indenture, dated as of September 19, 2012, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee with respect to $1.0 billion aggregate principal amount of 6.750% Senior Notes due 2020 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on September 19, 2012).

4.1(11)

Second Supplemental Indenture, dated December 20, 2012, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee to the Indenture, dated as of March 22, 2012, among the Company and U.S. Bank National Association, as trustee, relating to the 6.625% senior notes due 2021 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on December 20, 2012).

4.1(12)

Third Supplemental Indenture, dated December 19, 2013, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee to the Indenture, dated as of March 22, 2012, among the Company and U.S. Bank National Association, as trustee, relating to the 5.250% senior notes due 2020 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on December 19, 2013).

4.1(13)

Fourth Supplemental Indenture, dated November 25, 2014, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among the Company and U.S. Bank National Association, as trustee, relating to the 6.000% senior notes due 2023 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on November 25, 2014).

4.1(14)

Fifth Supplemental Indenture, dated August 19, 2016, among MGM Resorts International, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among MGM Resorts International and U.S. Bank National Association, as trustee, relating to the 4.625% senior notes due 2026 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on August 19, 2016).

4.1(15)

Indenture, dated as of August 12, 2016, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on August 12, 2016).

4.1(16)

Indenture, dated as of April 20, 2016, among MGP Escrow Issuer, LLC and MGP Escrow Co-Issuer, Inc. and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed April 21, 2016).

4.1(17)

Indenture, dated as of September 21, 2017, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 21, 2017).

4.2(1)

Guarantee (Mandalay Resort Group 6.70% Senior Notes due 2096), dated as of April 25, 2005, by the Company certain subsidiaries of the Company, in favor of The Bank of New York, as successor in interest to First Interstate Bank of Nevada, N.A., as trustee for the benefit of the holders of the Notes pursuant to the Indenture referred to therein (incorporated by reference to Exhibit 10.21 to the September 2005 10-Q).


4.2(2)

Guarantee (Mandalay Resort Group 7.0% Senior Notes due 2036), dated as of April 25, 2005, by the Company and certain subsidiaries of the Company, in favor of The Bank of New York, as trustee for the benefit of the holders of the Notes pursuant to the Indenture referred to therein (incorporated by reference to Exhibit 10.22 to the September 2005 10-Q).

4.3

Registration Rights Agreement, dated as of April 20, 2016, among MGP Escrow Issuer, LLC and MGP Escrow Co-Issuer, Inc. and J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the initial purchasers of the Notes (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed April 21, 2016).

10.1(1)

Amended and Restated Credit Agreement, dated as of April 25, 2016, among MGM Resorts International, the Lenders from time to time party thereto and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed April 25, 2016).

10.1(2)

Credit Agreement, dated as of April 25, 2016, among MGM Growth Properties Operating Partnership LP, the financial institutions referred to as Lenders therein and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.17 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).

10.1(3)

First Amendment to Credit Agreement, dated October 26, 2016, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on October 26, 2016).

10.1(4)

Second Amendment to Credit Agreement, dated May 1, 2017, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on May 1, 2017).

10.1(5)

Second Supplemental Agreement, dated June 9, 2015, between MGM China Holdings Limited and MGM Grand Paradise, S.A., certain Lenders and Arrangers named therein, Bank of America, N.A., Hong Kong Branch, as Facility Agent and Issuing Bank, and Banco Nacional Ultramarino, S.A., as Original Security Agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 12, 2015).

10.1(6)

Third Supplemental Agreement, by and among MGM China Holdings Limited, MGM Grand Paradise, S.A., the guarantors named therein, and Bank of America, N.A., as facility agent, dated February 2, 2016 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 4, 2016).

10.1 (7)

Fourth Supplemental Agreement, dated February 15, 2017, among MGM China Holdings Limited, MGM Grand Paradise, S.A., the guarantors named therein and Bank of America, N.A., as facility agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed February 16, 2017).

10.2(1)

Subconcession Contract for the Exploitation of Games Fortune and Chance or Other Games in Casino in the Special Administrative Region of Macau, dated April 19, 2005, between Sociedade de Jogos de Macau, S.A., as concessionaire, and MGM Grand Paradise S.A., as subconcessionaire (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on November 7, 2011).

10.2(2)

Land Concession Agreement, dated as of April 18, 2005, relating to the MGM Macau resort and casino between the Special Administrative Region of Macau and MGM Grand Paradise, S.A. (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2011).

10.2(3)

Land Concession Agreement, effective as of January 9, 2013, relating to the MGM Macau resort and casino between the Special Administrative Region of Macau and MGM Grand Paradise S.A. (incorporated by reference to Exhibit 10.2(4) to the Company’s Annual Report on Form 10-K filed on March 1, 2013).

10.3(1)

Third Amended and Restated Limited Liability Company Agreement of CityCenter Holdings, LLC, dated December 22, 2015 (incorporated by reference to Exhibit 10.3(1) to the Company’s Annual Report on Form 10-K filed on February 29, 2016).

10.3(2)

Company Stock Purchase and Support Agreement, dated August 21, 2007, by and between the Company and Infinity World Investments, LLC (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed August 27, 2007).


10.3(3)

Amendment No. 1, dated October 17, 2007, to the Company Stock Purchase and Support Agreement by and between the Company and Infinity World Investments, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 23, 2007).

10.4(1)

Master Lease between MGP Lessor, LLC and MGM Lessee, LLC, dated April 25, 2016 (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).

10.4(2)

First Amendment to Master Lease, dated as of August 1, 2016, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 1, 2016).

10.4(3)

Second Amendment to Master Lease, dated as of October 5, 2017, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on October 6, 2017).

†10.4(4)

Hotel & Casino Ground Lease between National Harbor Beltway L.C., as landlord, and MGM National Harbor, LLC, as tenant, dated as of April 26, 2013 (incorporated by reference to Exhibit 10.4(3) to the Company’s Annual Report on Form 10‑K filed on March 1, 2017).

†10.4(5)

First Amendment to Hotel and Casino Ground Lease, dated July 23, 2014 between National Harbor Beltway L.C. and MGM National Harbor, LLC (incorporated by reference to Exhibit 10.4(4) to the Company’s Annual Report on Form 10‑K filed on March 1, 2017).

†10.4(6)

Second Amendment to Hotel and Casino Ground Lease, dated November 24, 2015 between National Harbor Grand LLC and MGM National Harbor, LLC (incorporated by reference to Exhibit 10.4(5) to the Company’s Annual Report on Form 10‑K filed on March 1, 2017).

10.4(7)

Third Amendment to the Hotel and Casino Ground Lease, dated as of August 21, 2017, by and between National Harbor Grand LLC and MGM National Harbor, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10‑Q filed on November 9, 2017).

*10.5(1)

Amended and Restated 2005 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 10, 2014).

*10.5(2)

Second Amended and Restated Annual Performance-Based Incentive Plan for Executive Officers (incorporated by reference to Appendix A to the Company’s Proxy Statement filed on April 20, 2016).

*10.5(3)

Deferred Compensation Plan II, as Amended and Restated, effective December 17, 2014 (incorporated by reference to Exhibit 10.4(6) to the Company’s Annual Report on Form 10-K filed on March 2, 2015).

*10.5(4)

Supplemental Executive Retirement Plan II, dated as of December 30, 2004 (incorporated by reference to Exhibit 10.1 on Form 8-K filed on January 10, 2005).

*10.5(5)

Amendment No. 1 to the Supplemental Executive Retirement Plan II, dated as of July 10, 2007 (incorporated by reference to Exhibit 10.3(12) to the 2007 10-K).

*10.5(6)

Amendment No. 2 to the Supplemental Executive Retirement Plan II, dated as of October 15, 2007 (incorporated by reference to Exhibit 10.3(14) to the 2007 10-K).

*10.5(7)

Amendment No. 1 to the Supplemental Executive Retirement Plan II, dated as of November 4, 2008 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on November 7, 2008).

*10.5(8)

Employment Agreement, effective as of December 13, 2014, between the Company and Robert H. Baldwin (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 13, 2015).

*10.5(9)

Employment Agreement, dated as of October 3, 2016, by and between the Company and James J. Murren (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 5, 2016).

*10.5(10)

Employment Agreement, executed as of August 24, 2015, between the Company and Daniel J. D’Arrigo (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 28, 2015).


*10.5(11)

Employment Agreement, effective as of November 15, 2016, between the Company and Corey Sanders (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on December 7, 2016).

*10.5(12)

Employment Agreement, effective as of November 15, 2016, between the Company and William Hornbuckle (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on December 7, 2016).

*10.5(13)

Deferred Compensation Plan for Non-Employee Directors, effective as of June 12, 2012 (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2012).

*10.5(14)

Form of Restricted Stock Units Agreement of the Company, effective for awards granted in August 2012 through 2015 (incorporated by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2012).

*10.5(15)

Form of Restricted Stock Units Agreement of the Company (Non-Employee Director), effective for awards granted in August 2012 and thereafter (incorporated by reference to Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2012).

*10.5(16)

Form of Restricted Stock Units Agreement of the Company (Performance), effective for awards granted in August 2012 through 2015 (incorporated by reference to Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2012).

*10.5(17)

Form of Restricted Stock Units Agreement of the Company effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).

*10.5(18)

Form of Restricted Stock Units Agreement of the Company (Performance) effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).

*10.5(19)

Form of Sign-On RSU Award Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on October 5, 2016).

*10.5(20)

Form of Performance Share Units Agreement of the Company, effective for bonus awards granted in March 2014 through March 2015 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 8, 2014).

*10.5(21)

Form of Performance Share Units Agreement of the Company effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).

*10.5(22)

Form of Bonus Performance Share Units Agreement of the Company, effective for bonus awards granted in March 2016 and thereafter (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on May 6, 2016).

*10.5(23)

Change of Control Policy for Executive Officers, dated as of November 5, 2012 (incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K filed on November 8, 2012).

*10.5(24)

Form of Memorandum Agreement re: Changes to Severance and Change of Control Policies (incorporated by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K filed on November 8, 2012).

*10.5(25)

Form of Freestanding Stock Appreciation Right Agreement of the Company effective for awards granted in August 2012 and thereafter (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2012).

*10.5(26)

Form of Freestanding Stock Appreciation Right Agreement of the Company effective for awards granted in October 2013 and thereafter (incorporated by reference to Exhibit 10.4(43) of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013).

*10.5(27)

Amendment to all Stock Appreciation Right Agreements adopted by the Compensation Committee of the Board of Directors on October 7, 2013 (incorporated by reference to Exhibit 10.4(44) of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013).


*10.5(28)

Form of Freestanding Stock Appreciation Right Agreement of the Company effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).

*10.5(29)

Profit Growth Share Incentive Plan of the Company (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).

*10.5(30)

Form of Performance Share Units Agreement (Profit Growth Share Incentive Plan) of the Company (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).

*10.5(31)

MGM Growth Properties LLC 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 99.1 of the Registration Statement on Form S-8 of MGM Growth Properties LLC (File No. 333-210832) filed on April 19, 2016).

*10.5(32)

MGM Growth Properties LLC Form of 2016 Restricted Share Units Agreement (MGM Non-Employee Directors) (incorporated by reference to Exhibit 10.15 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).

*10.5(33)

MGM Growth Properties LLC Form of 2016 Restricted Share Units Agreement (MGM Employees) (incorporated by reference to Exhibit 10.16 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).

*10.5(34)

Form of Letter to Employees re: Existing Equity Awards (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed March 10, 2017).

*10.5(35)

Form of Performance Share Unit Agreement (Bonus Payout) (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed March 10, 2017).

*10.5(36)

Form of Performance Share Unit Agreement (Annual Grant) (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed March 10, 2017).

*10.5(37)

Form of Restricted Stock Unit Agreement (Non-Employee Director) (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed March 10, 2017).

*10.5(38)

Form of Restricted Stock Unit Agreement (with Performance Hurdle) (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed March 10, 2017).

*10.5(39)

Form of Restricted Stock Unit Agreement (no Performance Hurdle) (incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K filed March 10, 2017).

*10.5(40)

Form of Restricted Stock Unit Agreement (Bonus RSUs).

*10.5(41)

Form of Relative Performance Share Unit Agreement (Annual Grant).

12

Computation of ratio of earnings to fixed charges.

21

List of subsidiaries of the Company.

23.1

Consent of Deloitte & Touche LLP, independent auditors to the Company.

23.2

Consent of Deloitte & Touche LLP, independent auditors to CityCenter Holdings, LLC.

31.1

Certification of Chief Executive Officer of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d‑14(a).

31.2

Certification of Chief Financial Officer of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d‑14(a).

**32.1

Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.

**32.2

Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.

99.1

Description of our Operating Resorts.


99.2

Description of Regulation and Licensing.

99.3

Audited consolidated financial statements of CityCenter Holdings, LLC, as of and for the three years in the period ended December 31, 2017.

101

The following information from the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 formatted in eXtensible Business Reporting Language: (i) Consolidated Balance Sheets at December 31, 2017 and December 31, 2016; (ii) Consolidated Statements of Operations for the years ended December 31, 2017, 2016 and 2015; (iii) Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2017, 2016 and 2015; (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016 and 2015; (v) Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2017, 2016 and 2015; (vi) Notes to the Consolidated Financial Statements and (vii) Financial Statement Schedule.

†

Portions of this Exhibit have been omitted pursuant to Rule 24b-2, are filed separately with the SEC and are subject to a confidential treatment request.

*

Management contract or compensatory plan or arrangement.

**

Exhibits 32.1 and 32.2 shall not be deemed filed with the SEC, nor shall they be deemed incorporated by reference in any filing with the SEC under the Exchange Act or the Securities Act of 1933, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any filings


MANAGEMENT’S ANNUAL REPORT

ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management’s Responsibilities

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Sections 13a-15(f) and 15d-15(f) of the Exchange Act) for MGM Resorts International and subsidiaries (the “Company”).

Objective of Internal Control over Financial Reporting

In establishing adequate internal control over financial reporting, management has developed and maintained a system of internal control, policies and procedures designed to provide reasonable assurance that information contained in the accompanying consolidated financial statements and other information presented in this annual report is reliable, does not contain any untrue statement of a material fact or omit to state a material fact, and fairly presents in all material respects the financial condition, results of operations and cash flows of the Company as of and for the periods presented in this annual report. These include controls and procedures designed to ensure that this information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate for all timely decisions regarding required disclosure. Significant elements of the Company’s internal control over financial reporting include, for example:

notes thereto.

Hiring skilled accounting personnel and training them appropriately;

58

Written accounting policies;


Written documentation of accounting systems and procedures;

Segregation of incompatible duties;

Internal audit function to monitor the effectiveness of the system of internal control; and

Oversight by an independent Audit Committee of the Board of Directors.

Management’s Evaluation

Management, with the participation of the Company’s principal executive officer and principal financial officer, has evaluated the Company’s internal control over financial reporting using the criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on its evaluation as of December 31, 2017, management believes that the Company’s internal control over financial reporting is effective in achieving the objectives described above.

Report of Independent Registered Public Accounting Firm

Deloitte & Touche LLP audited the Company’s consolidated financial statements as of and for the year ended December 31, 2017 and issued their report thereon, which is included in this annual report. Deloitte & Touche LLP has also issued an attestation report on the effectiveness of the Company’s internal control over financial reporting and such report is also included in this annual report.


REPORTREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Stockholders and the Board of Directors of MGM Resorts International


Opinion on Internal Control over Financial Reporting


We have audited the internal control over financial reporting of MGM Resorts International and subsidiaries (the “Company”) as of December 31, 2017,2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017,2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.


We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements and financial statement schedule as of and for the year ended December 31, 2017,2021, of the Company and our report dated March 1, 2018,February 25, 2022, expressed an unqualified opinion on those financial statements.


Basis for Opinion


The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.


We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.


Definition and Limitations of Internal Control over Financial Reporting


A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.


Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.


/s/ DELOITTEDeloitte & TOUCHETouche LLP


Las Vegas, Nevada

March 1, 2018


February 25, 2022

REPORT




59

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Stockholders and the Board of Directors of MGM Resorts International


Opinion on the Financial Statements


We have audited the accompanying consolidated balance sheets of MGM Resorts International and subsidiaries (the "Company") as of December 31, 20172021 and 2016,2020, the related consolidated statements of operations, comprehensive income (loss), cash flows and stockholders' equity for each of the three years in the period ended December 31, 2017,2021, and the related notes and the financial statement schedule of Valuation and Qualifying Accounts included in Item 15(a)(2), (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 20172021 and 2016,2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2017,2021, in conformity with accounting principles generally accepted in the United States of America.


We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2017,2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 1, 2018,February 25, 2022, expressed an unqualified opinion on the Company's internal control over financial reporting.


Basis for Opinion


These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.


We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.


Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Acquisition and Goodwill and Other Intangible Assets Valuation of CityCenter — Refer to Notes 1 and 4 to the financial statements

On September 27, 2021, the Company completed the acquisition of the 50% ownership interest in CityCenter Holdings, LLC (“CityCenter”) held by Infinity World Development Corp for cash consideration of $2.125 billion. Prior to the acquisition, the Company held a 50% ownership interest, which was accounted for under the equity method. The Company accounted for the acquisition under the acquisition method of accounting for business combinations, and the fair value was allocated to the assets acquired and liabilities assumed at the acquisition date, which included $180.0 million of trademarks and $1.4 billion of goodwill. Management estimated the fair value of the trademarks using the relief from royalty method, which is a specific discounted cash flow method. Goodwill was recognized as the excess of the cash consideration and the acquisition-date fair value of the Company’s equity method investment over the identifiable assets acquired and liabilities assumed.

The fair value determination of the trademarks required management to make significant estimates and assumptions around expected cash flows and projected financial results, including forecasted revenues (collectively the “forecast”), as
60

well as the selection of discount rates. Changes to these assumptions and estimates could have a significant impact on the fair value of the trademarks and the recognition of goodwill. Therefore, auditing the forecast and the selection of discount rates involved a higher degree of auditor judgment and subjectivity, as well as an increased level of audit effort, including the involvement of fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the forecast and selection of discount rates used by management to determine the fair value of the acquired intangible assets and the reporting unit assigned goodwill included the following, among others:

•We tested the effectiveness of controls over determining the fair value of the tradename, including those over management’s forecast and the selection of discount rates.

•We evaluated the assumptions and estimates included in the forecast by:
◦Comparing the forecasts to information included in the Company’s communications to the Board of Directors, earnings and press releases, gaming industry reports, investor presentations, and analyst reports for the Company and certain of its peer companies;
◦Comparing the forecasts to historical financial results;
◦Conducting inquiries with management; and
◦Evaluating whether the forecast was consistent with evidence obtained in other areas of the audit.

•With the assistance of our fair value specialists, we evaluated the reasonableness of the discount rates by:
◦Testing the market-based source information underlying the determination of the discount rates and the mathematical accuracy of the discount rate calculations.
◦Developing a range of independent estimates and comparing those to the discount rate selected by management.

/s/ DELOITTEDeloitte & TOUCHETouche LLP


Las Vegas, Nevada

March 1, 2018

February 25, 2022

We have served as the Company's auditor since 2002.


61


MGM RESORTS INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

 

 

December 31,

 

 

 

2017

 

 

2016

 

ASSETS

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,499,995

 

 

$

1,446,581

 

Accounts receivable, net

 

 

540,545

 

 

 

542,924

 

Inventories

 

 

102,292

 

 

 

97,733

 

Income tax receivable

 

 

42,551

 

 

 

—

 

Prepaid expenses and other

 

 

189,244

 

 

 

142,349

 

Total current assets

 

 

2,374,627

 

 

 

2,229,587

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

19,635,459

 

 

 

18,425,023

 

 

 

 

 

 

 

 

 

 

Other assets

 

 

 

 

 

 

 

 

Investments in and advances to unconsolidated affiliates

 

 

1,034,161

 

 

 

1,220,443

 

Goodwill

 

 

1,806,531

 

 

 

1,817,119

 

Other intangible assets, net

 

 

3,877,960

 

 

 

4,087,706

 

Other long-term assets, net

 

 

430,440

 

 

 

393,423

 

Total other assets

 

 

7,149,092

 

 

 

7,518,691

 

 

 

$

29,159,178

 

 

$

28,173,301

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$

255,028

 

 

$

250,477

 

Construction payable

 

 

474,807

 

 

 

270,361

 

Income tax payable

 

 

—

 

 

 

10,654

 

Current portion of long-term debt

 

 

158,042

 

 

 

8,375

 

Accrued interest on long-term debt

 

 

135,785

 

 

 

159,028

 

Other accrued liabilities

 

 

2,068,720

 

 

 

1,594,526

 

Total current liabilities

 

 

3,092,382

 

 

 

2,293,421

 

 

 

 

 

 

 

 

 

 

Deferred income taxes, net

 

 

1,304,835

 

 

 

2,551,228

 

Long-term debt, net

 

 

12,751,052

 

 

 

12,979,220

 

Other long-term obligations

 

 

284,416

 

 

 

325,981

 

Commitments and contingencies (Note 12)

 

 

 

 

 

 

 

 

Redeemable noncontrolling interests

 

 

79,778

 

 

 

54,139

 

Stockholders' equity

 

 

 

 

 

 

 

 

Common stock, $.01 par value: authorized 1,000,000,000 shares, issued and

   outstanding 566,275,789 and 574,123,706 shares

 

 

5,663

 

 

 

5,741

 

Capital in excess of par value

 

 

5,357,709

 

 

 

5,653,575

 

Retained earnings

 

 

2,252,890

 

 

 

545,811

 

Accumulated other comprehensive income (loss)

 

 

(3,610

)

 

 

15,053

 

Total MGM Resorts International stockholders' equity

 

 

7,612,652

 

 

 

6,220,180

 

Noncontrolling interests

 

 

4,034,063

 

 

 

3,749,132

 

Total stockholders' equity

 

 

11,646,715

 

 

 

9,969,312

 

 

 

$

29,159,178

 

 

$

28,173,301

 


 December 31,
 20212020
ASSETS
Current assets  
Cash and cash equivalents$4,703,059 $5,101,637 
Restricted cash500,000 — 
Accounts receivable, net583,915 316,502 
Inventories96,374 88,323 
Income tax receivable273,862 243,415 
Prepaid expenses and other258,972 200,782 
Total current assets6,416,182 5,950,659 
 
Property and equipment, net14,435,493 14,632,091 
 
Other assets
Investments in and advances to unconsolidated affiliates967,044 1,447,043 
Goodwill3,480,997 2,091,278 
Other intangible assets, net3,616,385 3,643,748 
Operating lease right-of-use assets, net11,492,805 8,286,694 
Other long-term assets, net490,210 443,421 
Total other assets20,047,441 15,912,184 
 $40,899,116 $36,494,934 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities  
Accounts payable$263,097 $142,523 
Construction payable23,09930,149
Current portion of long-term debt1,000,000— 
Accrued interest on long-term debt172,624138,832
Other accrued liabilities1,983,4441,545,079
Total current liabilities3,442,2641,856,583
 
Deferred income taxes, net2,439,3642,153,016
Long-term debt, net11,770,79712,376,684
Operating lease liabilities11,802,4648,390,117
Other long-term obligations319,914472,084
Commitments and contingencies (Note 12)00
Redeemable noncontrolling interests147,54766,542
Stockholders' equity
Common stock, $0.01 par value: authorized 1,000,000,000 shares, issued and
 outstanding 453,803,759 and 494,317,865 shares
4,5384,943
Capital in excess of par value1,750,1353,439,453
Retained earnings4,340,5883,091,007
Accumulated other comprehensive loss(24,616)(30,677)
Total MGM Resorts International stockholders' equity6,070,6456,504,726
Noncontrolling interests4,906,1214,675,182
Total stockholders' equity10,976,76611,179,908
 $40,899,116 $36,494,934 

The accompanying notes are an integral part of these consolidated financial statements.



62

MGM RESORTS INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Casino

 

$

5,984,335

 

 

$

4,936,490

 

 

$

4,842,836

 

Rooms

 

 

2,151,380

 

 

 

2,023,841

 

 

 

1,876,733

 

Food and beverage

 

 

1,790,287

 

 

 

1,639,910

 

 

 

1,575,496

 

Entertainment

 

 

542,706

 

 

 

517,433

 

 

 

539,318

 

Retail

 

 

214,331

 

 

 

200,340

 

 

 

201,688

 

Other

 

 

605,832

 

 

 

533,528

 

 

 

506,934

 

Reimbursed costs

 

 

402,042

 

 

 

397,152

 

 

 

398,836

 

 

 

 

11,690,913

 

 

 

10,248,694

 

 

 

9,941,841

 

Less: Promotional allowances

 

 

(917,009

)

 

 

(793,571

)

 

 

(751,773

)

 

 

 

10,773,904

 

 

 

9,455,123

 

 

 

9,190,068

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

Casino

 

 

3,241,180

 

 

 

2,718,483

 

 

 

2,882,752

 

Rooms

 

 

608,103

 

 

 

576,426

 

 

 

564,094

 

Food and beverage

 

 

1,004,949

 

 

 

943,803

 

 

 

917,993

 

Entertainment

 

 

430,981

 

 

 

411,657

 

 

 

410,284

 

Retail

 

 

102,886

 

 

 

96,928

 

 

 

102,904

 

Other

 

 

375,865

 

 

 

351,215

 

 

 

348,513

 

Reimbursed costs

 

 

402,042

 

 

 

397,152

 

 

 

398,836

 

General and administrative

 

 

1,559,915

 

 

 

1,378,617

 

 

 

1,309,104

 

Corporate expense

 

 

356,875

 

 

 

312,774

 

 

 

274,551

 

NV Energy exit expense

 

 

(40,629

)

 

 

139,335

 

 

 

—

 

Preopening and start-up expenses

 

 

118,475

 

 

 

140,075

 

 

 

71,327

 

Property transactions, net

 

 

50,279

 

 

 

17,078

 

 

 

35,951

 

Goodwill impairment

 

 

—

 

 

 

—

 

 

 

1,467,991

 

Gain on Borgata transaction

 

 

—

 

 

 

(430,118

)

 

 

—

 

Depreciation and amortization

 

 

993,480

 

 

 

849,527

 

 

 

819,883

 

 

 

 

9,204,401

 

 

 

7,902,952

 

 

 

9,604,183

 

Income from unconsolidated affiliates

 

 

145,989

 

 

 

527,616

 

 

 

257,883

 

Operating income (loss)

 

 

1,715,492

 

 

 

2,079,787

 

 

 

(156,232

)

Non-operating income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net of amounts capitalized

 

 

(668,745

)

 

 

(694,773

)

 

 

(797,579

)

Non-operating items from unconsolidated affiliates

 

 

(34,751

)

 

 

(53,139

)

 

 

(76,462

)

Other, net

 

 

(48,241

)

 

 

(72,698

)

 

 

(15,970

)

 

 

 

(751,737

)

 

 

(820,610

)

 

 

(890,011

)

Income (loss) before income taxes

 

 

963,755

 

 

 

1,259,177

 

 

 

(1,046,243

)

Benefit (provision) for income taxes

 

 

1,132,663

 

 

 

(22,299

)

 

 

6,594

 

Net income (loss)

 

 

2,096,418

 

 

 

1,236,878

 

 

 

(1,039,649

)

Less: Net (income) loss attributable to noncontrolling interests

 

 

(136,132

)

 

 

(135,438

)

 

 

591,929

 

Net income (loss) attributable to MGM Resorts International

 

$

1,960,286

 

 

$

1,101,440

 

 

$

(447,720

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

3.39

 

 

$

1.94

 

 

$

(0.82

)

Diluted

 

$

3.35

 

 

$

1.92

 

 

$

(0.82

)

Weighted average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

572,253

 

 

 

568,134

 

 

 

542,873

 

Diluted

 

 

578,795

 

 

 

573,317

 

 

 

542,873

 

Dividends declared per common share

 

$

0.44

 

 

$

—

 

 

$

—

 


 Year Ended December 31,
 202120202019
Revenues   
Casino$5,362,912 $2,871,720 $6,517,759 
Rooms1,690,037 830,382 2,322,579 
Food and beverage1,391,605 696,040 2,145,247 
Entertainment, retail and other1,009,503 518,991 1,477,200 
Reimbursed costs226,083 244,949 436,887 
 9,680,140 5,162,082 12,899,672 
Expenses
Casino2,551,169 1,701,783 3,623,899 
Rooms600,942 419,156 829,677 
Food and beverage1,034,780 674,118 1,661,626 
Entertainment, retail and other617,635 412,705 1,051,400 
Reimbursed costs226,083 244,949 436,887 
General and administrative2,507,239 2,122,333 2,101,217 
Corporate expense422,777 460,148 464,642 
Preopening and start-up expenses5,094 84 7,175 
Property transactions, net(67,736)93,567 275,802 
Gain on REIT transactions, net— (1,491,945)(2,677,996)
Gain on consolidation of CityCenter, net(1,562,329)— — 
Depreciation and amortization1,150,610 1,210,556 1,304,649 
 7,486,264 5,847,454 9,078,978 
Income from unconsolidated affiliates84,823 42,938 119,521 
Operating income (loss)2,278,699 (642,434)3,940,215 
Non-operating income (expense)
Interest expense, net of amounts capitalized(799,593)(676,380)(847,932)
Non-operating items from unconsolidated affiliates(83,243)(103,304)(62,296)
Other, net65,941 (89,361)(183,262)
 (816,895)(869,045)(1,093,490)
Income (loss) before income taxes1,461,804 (1,511,479)2,846,725 
Benefit (provision) for income taxes(253,415)191,572 (632,345)
Net income (loss)1,208,389 (1,319,907)2,214,380 
Less: Net (income) loss attributable to noncontrolling interests45,981 287,183 (165,234)
Net income (loss) attributable to MGM Resorts International$1,254,370 $(1,032,724)$2,049,146 
 
Earnings (loss) per share
Basic$2.44 $(2.02)$3.90 
Diluted$2.41 $(2.02)$3.88 
Weighted average common shares outstanding
Basic481,930494,152524,173
Diluted487,356494,152527,645

The accompanying notes are an integral part of these consolidated financial statements.




63

MGM RESORTS INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

Net income (loss)

 

$

2,096,418

 

 

$

1,236,878

 

 

$

(1,039,649

)

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(43,188

)

 

 

(2,680

)

 

 

3,727

 

Unrealized gain on cash flow hedges

 

 

7,995

 

 

 

1,879

 

 

 

—

 

Other

 

 

—

 

 

 

—

 

 

 

(672

)

Other comprehensive income (loss)

 

 

(35,193

)

 

 

(801

)

 

 

3,055

 

Comprehensive income (loss)

 

 

2,061,225

 

 

 

1,236,077

 

 

 

(1,036,594

)

Less: Comprehensive (income) loss attributable to noncontrolling interests

 

 

(119,700

)

 

 

(134,680

)

 

 

589,905

 

Comprehensive income (loss) attributable to MGM Resorts International

 

$

1,941,525

 

 

$

1,101,397

 

 

$

(446,689

)


 Year Ended December 31,
 202120202019
Net income (loss)$1,208,389 $(1,319,907)$2,214,380 
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment(24,655)27,762 28,870 
Unrealized gain (loss) on cash flow hedges34,788 (79,365)(29,505)
Other comprehensive income (loss)10,133 (51,603)(635)
Comprehensive income (loss)1,218,522 (1,371,510)2,213,745 
Less: Comprehensive (income) loss attributable to noncontrolling interests35,700 309,969 (168,447)
Comprehensive income (loss) attributable to MGM Resorts International$1,254,222 $(1,061,541)$2,045,298 

The accompanying notes are an integral part of these consolidated financial statements.




64

MGM RESORTS INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

2,096,418

 

 

$

1,236,878

 

 

$

(1,039,649

)

Adjustments to reconcile net income (loss) to net cash provided by

   operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

993,480

 

 

 

849,527

 

 

 

819,883

 

Amortization of debt discounts, premiums and issuance costs

 

 

32,996

 

 

 

40,493

 

 

 

46,280

 

Loss on retirement of long-term debt

 

 

45,696

 

 

 

66,933

 

 

 

1,924

 

Provision for doubtful accounts

 

 

20,603

 

 

 

10,863

 

 

 

54,691

 

Stock-based compensation

 

 

62,494

 

 

 

55,487

 

 

 

42,872

 

Property transactions, net

 

 

50,279

 

 

 

17,078

 

 

 

35,951

 

Goodwill impairment

 

 

—

 

 

 

—

 

 

 

1,467,991

 

Gain on Borgata transaction

 

 

—

 

 

 

(430,118

)

 

 

—

 

(Income) loss from unconsolidated affiliates

 

 

(111,238

)

 

 

(471,309

)

 

 

(177,946

)

Distributions from unconsolidated affiliates

 

 

13,050

 

 

 

16,905

 

 

 

29,333

 

Deferred income taxes

 

 

(1,264,674

)

 

 

(80,628

)

 

 

(3,615

)

Change in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(18,438

)

 

 

(33,208

)

 

 

(62,720

)

Inventories

 

 

(4,656

)

 

 

10,806

 

 

 

(2,649

)

Income taxes receivable and payable, net

 

 

(53,204

)

 

 

13,385

 

 

 

(5,946

)

Prepaid expenses and other

 

 

(46,974

)

 

 

20,192

 

 

 

(13,694

)

Prepaid Cotai land concession premium

 

 

(7,765

)

 

 

(22,376

)

 

 

(22,427

)

Accounts payable and accrued liabilities

 

 

419,525

 

 

 

272,828

 

 

 

(139,069

)

Other

 

 

(21,181

)

 

 

(39,764

)

 

 

(26,131

)

Net cash provided by operating activities

 

 

2,206,411

 

 

 

1,533,972

 

 

 

1,005,079

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures, net of construction payable

 

 

(1,864,082

)

 

 

(2,262,473

)

 

 

(1,466,819

)

Dispositions of property and equipment

 

 

718

 

 

 

3,944

 

 

 

8,032

 

Proceeds from partial disposition of investment in unconsolidated affiliate

 

 

—

 

 

 

15,000

 

 

 

—

 

Proceeds from sale of business units and investment in unconsolidated affiliate

 

 

—

 

 

 

—

��

 

 

92,207

 

Acquisition of Borgata, net of cash acquired

 

 

—

 

 

 

(559,443

)

 

 

—

 

Investments in and advances to unconsolidated affiliates

 

 

(16,727

)

 

 

(3,633

)

 

 

(196,062

)

Distributions from unconsolidated affiliates in excess of cumulative earnings

 

 

301,211

 

 

 

542,097

 

 

 

201,612

 

Investments in cash deposits - original maturities longer than 90 days

 

 

—

 

 

 

—

 

 

 

(200,205

)

Proceeds from cash deposits - original maturities longer than 90 days

 

 

—

 

 

 

—

 

 

 

770,205

 

Other

 

 

(1,712

)

 

 

(11,696

)

 

 

(4,028

)

Net cash used in investing activities

 

 

(1,580,592

)

 

 

(2,276,204

)

 

 

(795,058

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

Net borrowings under bank credit facilities – maturities of

   90 days or less

 

 

15,001

 

 

 

491,032

 

 

 

977,275

 

Borrowings under bank credit facilities – maturities longer than 90 days

 

 

—

 

 

 

1,845,375

 

 

 

5,118,750

 

Repayments under bank credit facilities – maturities longer than 90 days

 

 

—

 

 

 

(1,845,375

)

 

 

(5,118,750

)

Issuance of long-term debt

 

 

350,000

 

 

 

2,050,000

 

 

 

—

 

Retirement of senior notes

 

 

(502,669

)

 

 

(2,258,053

)

 

 

(875,504

)

Repayment of Borgata credit facility

 

 

—

 

 

 

(583,598

)

 

 

—

 

Debt issuance costs

 

 

(9,977

)

 

 

(139,584

)

 

 

(46,170

)

Issuance of MGM Growth Properties Class A shares in public offering

 

 

404,685

 

 

 

1,207,500

 

 

 

—

 

MGM Growth Properties Class A share issuance costs

 

 

(17,137

)

 

 

(75,032

)

 

 

—

 

Acquisition of MGM China shares

 

 

—

 

 

 

(100,000

)

 

 

—

 

Dividends paid to common shareholders

 

 

(252,014

)

 

 

—

 

 

 

—

 

Distributions to noncontrolling interest owners

 

 

(170,402

)

 

 

(103,367

)

 

 

(307,227

)

Proceeds from issuance of redeemable noncontrolling interests

 

 

—

 

 

 

47,325

 

 

 

6,250

 

Purchases of common stock

 

 

(327,500

)

 

 

—

 

 

 

—

 

Other

 

 

(58,765

)

 

 

(16,801

)

 

 

(12,503

)

Net cash provided by (used in) financing activities

 

 

(568,778

)

 

 

519,422

 

 

 

(257,879

)

Effect of exchange rate on cash

 

 

(3,627

)

 

 

(921

)

 

 

793

 

Cash and cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) for the period

 

 

53,414

 

 

 

(223,731

)

 

 

(47,065

)

Change in cash related to assets held for sale

 

 

—

 

 

 

—

 

 

 

3,662

 

Balance, beginning of period

 

 

1,446,581

 

 

 

1,670,312

 

 

 

1,713,715

 

Balance, end of period

 

$

1,499,995

 

 

$

1,446,581

 

 

$

1,670,312

 

Supplemental cash flow disclosures

 

 

 

 

 

 

 

 

 

 

 

 

Interest paid, net of amounts capitalized

 

$

658,637

 

 

$

661,166

 

 

$

776,540

 

Federal, state and foreign income taxes paid, net of refunds

 

 

181,651

 

 

 

68,236

 

 

 

11,801

 

Non-cash investing and financing activities

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued for acquisition of MGM China shares

 

$

—

 

 

$

174,041

 

 

$

—

 

Deferred cash payment for acquisition of MGM China shares

 

 

—

 

 

 

43,265

 

 

 

—

 

Conversion of convertible senior notes to equity

 

 

—

 

 

 

—

 

 

 

1,449,499

 

Increase (decrease) in investment in and advances to CityCenter related to change

   in completion guarantee liability

 

 

—

 

 

 

—

 

 

 

(8,198

)

Increase in construction accounts payable

 

 

204,446

 

 

 

20,241

 

 

 

79,681

 


 Year Ended December 31,
 202120202019
Cash flows from operating activities   
Net income (loss)$1,208,389 $(1,319,907)$2,214,380 
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization1,150,610 1,210,556 1,304,649 
Amortization of debt discounts, premiums and issuance costs40,328 34,363 38,972 
Loss on early retirement of debt37 126,462 198,151 
Provision for credit losses21,852 71,422 39,270 
Stock-based compensation65,183 106,956 88,838 
Property transactions, net(67,736)93,567 275,802 
Gain on REIT transactions, net— (1,491,945)(2,677,996)
Gain on consolidation of CityCenter, net(1,562,329)— — 
Noncash lease expense188,917 183,399 71,784 
Other investment gains(28,417)— — 
Loss (income) from unconsolidated affiliates(1,580)60,366 (57,225)
Distributions from unconsolidated affiliates99,370 86,584 299 
Deferred income taxes241,947 18,347 595,046 
Change in operating assets and liabilities:
Accounts receivable(236,182)960,099 (726,610)
Inventories3,107 14,705 6,522 
Income taxes receivable and payable, net(30,444)(216,250)1,259 
Prepaid expenses and other(36,608)(37)7,567 
Accounts payable and accrued liabilities442,626 (1,382,980)465,602 
Other(125,647)(48,750)(35,909)
Net cash provided by (used in) operating activities1,373,423 (1,493,043)1,810,401 
Cash flows from investing activities
Capital expenditures(490,697)(270,579)(739,006)
Dispositions of property and equipment106,600 6,136 2,578 
Proceeds from real estate transactions3,888,431 2,455,839 4,151,499 
Proceeds from sale of Circus Circus Las Vegas and adjacent land— — 652,333 
Acquisitions, net of cash acquired(1,789,604)— (535,681)
Investments in unconsolidated affiliates(226,889)(96,925)(81,877)
Distributions from unconsolidated affiliates9,694 63,960 100,700 
Other46,110 873 (31,112)
Net cash provided by investing activities1,543,645 2,159,304 3,519,434 
Cash flows from financing activities
Net repayments under bank credit facilities – maturities of 90 days or less(2,096,217)(1,595,089)(3,634,049)
Issuance of long-term debt749,775 3,550,000 3,250,000 
Retirement of senior notes— (846,815)(3,764,167)
Debt issuance costs(18,726)(62,348)(63,391)
Proceeds from issuance of bridge loan facility— 1,304,625 — 
Issuance of MGM Growth Properties Class A shares, net792,851 524,704 1,250,006 
Dividends paid to common shareholders(4,789)(77,606)(271,288)
Distributions to noncontrolling interest owners(324,190)(286,385)(223,303)
Purchases of common stock(1,753,509)(353,720)(1,031,534)
Other(159,290)(53,939)(41,868)
Net cash provided by (used in) financing activities(2,814,095)2,103,427 (4,529,594)
Effect of exchange rate on cash, cash equivalents, and restricted cash(1,551)2,345 2,601 
Cash, cash equivalents, and restricted cash
Net increase for the period101,422 2,772,033 802,842 
Balance, beginning of period5,101,637 2,329,604 1,526,762 
Balance, end of period$5,203,059 $5,101,637 $2,329,604 
Supplemental cash flow disclosures
Interest paid, net of amounts capitalized$705,680 $639,718 $826,970 
Federal, state and foreign income taxes paid, net43,018 8,543 28,493 
Non-cash investing and financing activities
Note receivable related to sale of Circus Circus Las Vegas and adjacent land$— $— $133,689 
Investments in unconsolidated affiliates— 802,000 62,133
MGP BREIT Venture assumption of bridge loan facility— 1,304,625 — 

The accompanying notes are an integral part of these consolidated financial statements.

65

MGM RESORTS INTERNATIONAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For the Years ended December 31, 2021, 2020 and 2019
(In thousands)
 Common StockCapital in Excess of Par ValueRetained Earnings (Accumulated Deficit)Accumulated Other Comprehensive Income (Loss)
Total MGM Resorts International Stockholders' Equity
Noncontrolling InterestsTotal Stockholders' Equity
 SharesPar Value
Balances, January 1, 2019527,480 $5,275 $4,092,085 $2,423,479 $(8,556)$6,512,283 $3,957,508 $10,469,791 
Net income— — — 2,049,146 — 2,049,146 156,141 2,205,287 
Currency translation adjustment— — — — 16,125 16,125 12,745 28,870 
Cash flow hedges— — — — (19,973)(19,973)(9,532)(29,505)
Stock-based compensation— — 83,897 — — 83,897 4,941 88,838 
Issuance of common stock pursuant to stock-based compensation awards2,150 20 (25,985)— — (25,965)— (25,965)
Cash distributions to noncontrolling interest owners— — — — — — (181,816)(181,816)
Dividends declared and paid to common shareholders ($0.52 per share)— — — (271,288)— (271,288)— (271,288)
MGP dividend payable to Class A shareholders— — — — — — (53,489)(53,489)
Issuance of restricted stock units— — 1,546 — — 1,546 — 1,546 
Repurchases of common stock(35,854)(358)(1,031,176)— — (1,031,534)— (1,031,534)
Adjustment of redeemable noncontrolling interest to redemption value— — (2,714)— — (2,714)— (2,714)
Empire City acquisition9,372 94 265,671 — — 265,765 — 265,765 
Empire City MGP transaction— — (18,913)— 195 (18,718)23,745 5,027 
MGP Class A share issuance— — 150,464 — 1,512 151,976 1,049,582 1,201,558 
Park MGM Transaction— — (1,984)— 16 (1,968)2,496 528 
Northfield transaction— — 21,681 — (2)21,679 (27,439)(5,760)
Other— — (3,473)— 481 (2,992)772 (2,220)
Balances, December 31, 2019503,148 5,031 3,531,099 4,201,337 (10,202)7,727,265 4,935,654 12,662,919 
Net loss— — — (1,032,724)— (1,032,724)(293,401)(1,326,125)
Currency translation adjustment— — — — 15,711 15,711 12,051 27,762 
Cash flow hedges— — — — (44,528)(44,528)(34,837)(79,365)
Stock-based compensation— — 100,907 — — 100,907 6,049 106,956 
Issuance of common stock pursuant to stock-based compensation awards2,031 21 (16,424)— — (16,403)— (16,403)
Cash distributions to noncontrolling interest owners— — — — — — (221,690)(221,690)
Dividends declared and paid to common shareholders ($0.1575 per share)— — — (77,606)— (77,606)— (77,606)
MGP dividend payable to Class A shareholders— — — — — — (64,086)(64,086)
Issuance of restricted stock units— — 2,142 — — 2,142 — 2,142 
Repurchases of common stock(10,861)(109)(353,611)— — (353,720)— (353,720)
Adjustment of redeemable noncontrolling interest to redemption value— — 35,520 — — 35,520 — 35,520 
MGP Class A share issuances— — 64,188 — 646 64,834 442,717 507,551 
MGP BREIT Venture Transaction— — (6,503)— (59)(6,562)8,287 1,725 
Redemption of Operating Partnership units— — 83,859 — 8,773 92,632 (114,924)(22,292)
Other— — (1,724)— (1,018)(2,742)(638)(3,380)
Balances, December 31, 2020494,318 4,943 3,439,453 3,091,007 (30,677)6,504,726 4,675,182 11,179,908 
Net income (loss)— — — 1,254,370 — 1,254,370 (55,793)1,198,577 
Currency translation adjustment— — — — (13,871)(13,871)(10,784)(24,655)
Cash flow hedges— — — — 13,723 13,723 21,065 34,788 
Stock-based compensation— — 59,492 — — 59,492 5,691 65,183 
Issuance of common stock pursuant to stock-based compensation awards2,574 25 (44,543)— — (44,518)— (44,518)
Cash distributions to noncontrolling interest owners— — — — — — (250,910)(250,910)
Dividends declared and paid to common shareholders ($0.01 per share)— — — (4,789)— (4,789)— (4,789)
MGP dividend payable to Class A shareholders— — — — — — (82,294)(82,294)
Repurchases of common stock(43,088)(430)(1,753,079)— — (1,753,509)— (1,753,509)
Adjustment of redeemable noncontrolling interest to redemption value— — (78,298)— — (78,298)— (78,298)
MGP Class A share issuances— — 99,934 — 3,240 103,174 656,361 759,535 
Redemption of Operating Partnership units— — 171,332 — 5,327 176,659 (227,487)(50,828)
MGM Springfield transaction— — (133,844)— — (133,844)172,749 38,905 
Other— — (10,312)— (2,358)(12,670)2,341 (10,329)
Balances, December 31, 2021453,804 $4,538 $1,750,135 $4,340,588 $(24,616)$6,070,645 $4,906,121 $10,976,766 

The accompanying notes are an integral part of these consolidated financial statements.


66


MGM RESORTS INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

For the Years ended December 31, 2017, 2016 and 2015

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retained

 

 

Accumulated

 

 

MGM Resorts

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Capital in

 

 

Earnings

 

 

Other

 

 

International

 

 

Non-

 

 

Total

 

 

 

 

 

 

 

Par

 

 

Excess of

 

 

(Accumulated

 

 

Comprehensive

 

 

Stockholders'

 

 

Controlling

 

 

Stockholders'

 

 

 

Shares

 

 

Value

 

 

Par Value

 

 

Deficit)

 

 

Income (Loss)

 

 

Equity

 

 

Interests

 

 

Equity

 

Balances, January 1, 2015

 

 

491,292

 

 

$

4,913

 

 

$

4,180,922

 

 

$

(107,909

)

 

$

12,991

 

 

$

4,090,917

 

 

$

3,537,357

 

 

$

7,628,274

 

Net loss

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(447,720

)

 

 

—

 

 

 

(447,720

)

 

 

(591,929

)

 

 

(1,039,649

)

Currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,703

 

 

 

1,703

 

 

 

2,024

 

 

 

3,727

 

Other comprehensive loss from

   unconsolidated affiliates, net

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(672

)

 

 

(672

)

 

 

—

 

 

 

(672

)

Stock-based compensation

 

 

—

 

 

 

—

 

 

 

38,464

 

 

 

—

 

 

 

—

 

 

 

38,464

 

 

 

4,538

 

 

 

43,002

 

Issuance of common stock pursuant to

   stock-based compensation awards

 

 

1,844

 

 

 

18

 

 

 

(24,896

)

 

 

—

 

 

 

—

 

 

 

(24,878

)

 

 

—

 

 

 

(24,878

)

Conversion of convertible debt to

  common stock

 

 

71,703

 

 

 

717

 

 

 

1,448,779

 

 

 

—

 

 

 

—

 

 

 

1,449,496

 

 

 

—

 

 

 

1,449,496

 

Cash distributions to noncontrolling

   interest owners

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(307,494

)

 

 

(307,494

)

Issuance of performance share units

 

 

—

 

 

 

—

 

 

 

4,872

 

 

 

—

 

 

 

—

 

 

 

4,872

 

 

 

—

 

 

 

4,872

 

Other

 

 

—

 

 

 

—

 

 

 

7,745

 

 

 

—

 

 

 

—

 

 

 

7,745

 

 

 

4

 

 

 

7,749

 

Balances, December 31, 2015

 

 

564,839

 

 

 

5,648

 

 

 

5,655,886

 

 

 

(555,629

)

 

 

14,022

 

 

 

5,119,927

 

 

 

2,644,500

 

 

 

7,764,427

 

Net income

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,101,440

 

 

 

—

 

 

 

1,101,440

 

 

 

134,902

 

 

 

1,236,342

 

Currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(1,477

)

 

 

(1,477

)

 

 

(1,203

)

 

 

(2,680

)

Stock-based compensation

 

 

—

 

 

 

—

 

 

 

51,460

 

 

 

—

 

 

 

—

 

 

 

51,460

 

 

 

4,147

 

 

 

55,607

 

Issuance of common stock pursuant to

   stock-based compensation awards

 

 

2,225

 

 

 

22

 

 

 

(30,065

)

 

 

—

 

 

 

—

 

 

 

(30,043

)

 

 

—

 

 

 

(30,043

)

Issuance of performance share units

 

 

—

 

 

 

—

 

 

 

5,817

 

 

 

—

 

 

 

—

 

 

 

5,817

 

 

 

—

 

 

 

5,817

 

Cash distributions to noncontrolling

   interest owners

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(103,457

)

 

 

(103,457

)

MGM Growth Properties IPO

 

 

—

 

 

 

—

 

 

 

(150,414

)

 

 

—

 

 

 

—

 

 

 

(150,414

)

 

 

1,334,252

 

 

 

1,183,838

 

MGP dividend payable to Class A

   shareholders

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(22,281

)

 

 

(22,281

)

MGM China common stock acquisition

 

 

7,060

 

 

 

71

 

 

 

127,146

 

 

 

—

 

 

 

1,074

 

 

 

128,291

 

 

 

(270,903

)

 

 

(142,612

)

Borgata transaction

 

 

—

 

 

 

—

 

 

 

(18,385

)

 

 

—

 

 

 

—

 

 

 

(18,385

)

 

 

28,752

 

 

 

10,367

 

Other comprehensive income - cash flow

   hedges

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,434

 

 

 

1,434

 

 

 

445

 

 

 

1,879

 

Other

 

 

—

 

 

 

—

 

 

 

12,130

 

 

 

—

 

 

 

—

 

 

 

12,130

 

 

 

(22

)

 

 

12,108

 

Balances, December 31, 2016

 

 

574,124

 

 

 

5,741

 

 

 

5,653,575

 

 

 

545,811

 

 

 

15,053

 

 

 

6,220,180

 

 

 

3,749,132

 

 

 

9,969,312

 

Net income

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,960,286

 

 

 

—

 

 

 

1,960,286

 

 

 

128,320

 

 

 

2,088,606

 

Currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(23,995

)

 

 

(23,995

)

 

 

(19,193

)

 

 

(43,188

)

Other comprehensive income - cash flow

   hedges

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,234

 

 

 

5,234

 

 

 

2,761

 

 

 

7,995

 

Stock-based compensation

 

 

—

 

 

 

—

 

 

 

57,531

 

 

 

—

 

 

 

—

 

 

 

57,531

 

 

 

4,991

 

 

 

62,522

 

Issuance of common stock pursuant to

   stock-based compensation awards

 

 

2,152

 

 

 

22

 

 

 

(33,802

)

 

 

—

 

 

 

—

 

 

 

(33,780

)

 

 

—

 

 

 

(33,780

)

Issuance of performance share units

 

 

—

 

 

 

—

 

 

 

9,648

 

 

 

—

 

 

 

—

 

 

 

9,648

 

 

 

95

 

 

 

9,743

 

Cash distributions to noncontrolling

   interest owners

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(147,685

)

 

 

(147,685

)

Dividends paid to common shareholders

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(252,014

)

 

 

—

 

 

 

(252,014

)

 

 

—

 

 

 

(252,014

)

MGP dividend payable to Class A

   shareholders

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(29,777

)

 

 

(29,777

)

National Harbor transaction

 

 

—

 

 

 

—

 

 

 

(12,486

)

 

 

—

 

 

 

(11

)

 

 

(12,497

)

 

 

19,383

 

 

 

6,886

 

Repurchase of common stock

 

 

(10,000

)

 

 

(100

)

 

 

(327,400

)

 

 

—

 

 

 

—

 

 

 

(327,500

)

 

 

—

 

 

 

(327,500

)

MGP Class A share issuance

 

 

—

 

 

 

—

 

 

 

35,029

 

 

 

—

 

 

 

109

 

 

 

35,138

 

 

 

326,484

 

 

 

361,622

 

Adjustment of redeemable non-controlling

   interest to redemption value

 

 

—

 

 

 

—

 

 

 

(18,280

)

 

 

—

 

 

 

—

 

 

 

(18,280

)

 

 

—

 

 

 

(18,280

)

Other

 

 

—

 

 

 

—

 

 

 

(6,106

)

 

 

(1,193

)

 

 

—

 

 

 

(7,299

)

 

 

(448

)

 

 

(7,747

)

Balances, December 31, 2017

 

 

566,276

 

 

$

5,663

 

 

$

5,357,709

 

 

$

2,252,890

 

 

$

(3,610

)

 

$

7,612,652

 

 

$

4,034,063

 

 

$

11,646,715

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 


MGM RESORTS INTERNATIONAL AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — ORGANIZATION


Organization. MGM Resorts International (together with its consolidated subsidiaries, unless otherwise indicated or unless the context requires otherwise, the “Company”) is a Delaware corporation that acts largely as a holding company and, through subsidiaries, owns and operates casino resorts.

As discussed further below,of December 31, 2021, the Company leases certain of its real estate assets from MGM Growth Properties Operating Partnership LP (the “Operating Partnership”), which is a consolidated subsidiary.

The Company owns and operates the following integrated casino, hotel and entertainment resorts in Las Vegas, Nevada: Aria (including Vdara), Bellagio, MGM Grand Las Vegas (including The Signature), The Mirage, Mandalay Bay, Luxor, New York-New York, Monte Carlo, ExcaliburPark MGM, and Circus Circus Las Vegas. Operations at MGM Grand Las Vegas include management of The Signature at MGM Grand Las Vegas, a condominium-hotel consisting of three towers.Excalibur. The Company also operates and, along with local investors, owns MGM Grand Detroit in Detroit, Michigan, and MGM National Harbor in Prince George’s County, Maryland. The Company also owns and operatesMaryland, MGM Springfield in Springfield, Massachusetts, Borgata located on Renaissance Pointe in the Marina area of Atlantic City, New Jersey, Empire City in Yonkers, New York, MGM Northfield Park in Northfield Park, Ohio, and the following resorts in Mississippi: Beau Rivage in Biloxi and Gold Strike Tunica in Tunica. Additionally, the Company owns and operates theThe Park, a dining and entertainment district located between New York-New York and Monte Carlo,Park MGM, and the Company owns and operates Shadow Creek, an exclusive world-class golf course located approximately ten miles north of its Las Vegas Strip resorts, Primm Valley Golf Club at the California/Nevada state lineResorts and Fallen Oak golf course in Saucier, Mississippi.

On April 25, 2016,


MGM Growth Properties LLC (“MGP”), a consolidated subsidiary of the Company, completed its initial public offering (“IPO”) of 57,500,000 of its Class A shares representing limited liability company interests (inclusive of the full exercise by the underwriters of their option to purchase 7,500,000 Class A shares) at an initial offering price of $21 per share. In connection with the IPO, the Company and MGP entered into a series of transactions and several agreements that, among other things, set forth the terms and conditions of the IPO and provide a framework for the Company’s relationship with MGP.

MGP is organized as an umbrella partnership REIT (commonly referred to as an “UPREIT”)UPREIT) structure in which substantially all of its assets are owned by and substantially all of its businesses arebusiness is conducted through itsMGM Growth Properties Operating Partnership subsidiary.LP (the “Operating Partnership”). MGP has two classes of authorized and outstanding voting common shares (collectively, the “shares”): Class A shares and a single Class B share.share. The Company owns MGP’s Class B share, which does not provide its holder any rights to profits or losses or any rights to receive distributions from operations of MGP or upon liquidation or winding up of MGP. MGP’s Class A shareholders are entitled to one1 vote per share, while the Company, as the owner of the Class B share, holds a controlling interest in MGP as it is entitled to an amount of votes representing a majority of the total voting power of MGP’s shares so long as the Company and its controlled affiliates’ (excluding MGP) aggregate beneficial ownership of the combined economic interests in MGP and the Operating Partnership does not fall below 30%. The Company and MGP each hold Operating Partnership units representing limited partner interests in the Operating Partnership. The general partner of the Operating Partnership is also a wholly owned subsidiary of MGP which is 100% owned by MGP. The. The Operating Partnership units held by the Company are exchangeable into Class A shares of MGP on a one-to-one basis, or cash at the fair valueFair Market Value of a Class A share.share (as defined in the Operating Partnership's partnership agreement). The determination of settlement method is at the option of MGP’s independent conflicts committee. The Company and MGP’s ownership interest percentage in the Operating Partnership have varied based upon the transactions that MGP has completed, as discussed in Note 13. As of December 31, 2017,2021, the Company owned 73.4%41.5% of the Operating Partnership units, and MGP held the remaining 26.6%58.5% ownership interest in the Operating Partnership.

Pursuant to a master contribution agreement entered into in connection with the IPO by and between the


The Company MGP, and the Operating Partnership, the Company contributedleases the real estate assets of The Mirage, Mandalay Bay, Luxor, New York-New York, Monte Carlo,Park MGM, Excalibur, The Park, Gold Strike Tunica, MGM Grand Detroit, and Beau Rivage, to newly formed subsidiariesBorgata, Empire City, MGM National Harbor, MGM Northfield Park, and subsequently transferred 100% ownership in such subsidiaries to the Operating Partnership in exchange for a percentage ownership of Operating Partnership units. Concurrently,MGM Springfield pursuant to a master lease agreement between a subsidiary of the Company (the “tenant”) and a subsidiary of the Operating Partnership (the “landlord”),Partnership. The Company leases the tenant leased the contributed real estate assets from the landlord.

Subsequentof Bellagio pursuant to the Company completing its acquisition of Borgata in August 2016, as discussed in Note 4, MGP acquired Borgata’s real property froma lease agreement between a subsidiary of the Company and in October 2017, MGP alsoa venture that is 5% owned by such subsidiary and 95% owned by a subsidiary of Blackstone Real Estate Income Trust, Inc. (“BREIT”, and such venture, the “Bellagio BREIT Venture”). Additionally, the Company leases the real estate assets of Mandalay Bay and MGM Grand Las Vegas, pursuant to a lease agreement between a subsidiary of the Company and a venture that is 50.1% owned by a subsidiary of the Operating Partnership and 49.9% by a subsidiary of BREIT (such venture, the “MGP BREIT Venture”). Further, the Company leases the real estate assets of Aria (including Vdara) pursuant to a lease agreement between a subsidiary of the Company and funds managed by The Blackstone Group ("Blackstone"), as further discussed below. Refer to Note 11 for further discussion of the leases.


In January 2019, the Company acquired the long-term leasehold interestreal property and operations associated with the Empire City Casino's racetrack and casino ("Empire City"). Subsequently, MGP acquired the developed real property associated with Empire City from the Company and Empire City was added to the master lease between the Company and MGP. Refer to Note 4 and Note 18 for additional information.

In March 2019, the Company entered into an amendment to the master lease with respect to improvements made by the Company related to the rebranding of the Park MGM National Harborand NoMad Las Vegas. Refer to Note 18 for additional information on this transaction, which eliminates in consolidation.

In April 2019, the Company acquired the membership interests of Northfield Park Associates, LLC ("Northfield") from MGP and MGP retained the associated real estate assets. The Company then rebranded the property to MGM
67

Northfield Park, and added it to the master lease between the Company and MGP. Refer to Note 18 for additional information.

On November 15, 2019, Bellagio BREIT Venture was formed, which acquired the Bellagio real estate assets from the Company and leased such assets back to the Company pursuant to a lease agreement. In exchange for the contribution of the real estate assets, the Company received total consideration of $4.25 billion, which consisted of a 5% equity interest in the venture and cash of approximately $4.2 billion. The Company recorded a gain of $2.7 billion related to sale of the Bellagio real estate assets, recorded in “Gain on REIT transactions, net” in the consolidated statements of operations, which primarily reflects the difference between the carrying value of the real estate assets sold and the consideration received. The Company also provides a shortfall guarantee of the principal amount of indebtedness of the debt of Bellagio BREIT Venture’s $3.01 billion of debt (and any interest accrued and unpaid thereon). Refer to Note 11 and Note 12 for additional information relating to the lease and guarantee, respectively.

In December 2019, the Company completed the sale of Circus Circus Las Vegas and adjacent land. See Note 16 for additional information related to this transaction.

On February 14, 2020, the Company completed a series of transactions (collectively the “MGP BREIT Venture Transaction”) pursuant to which the real estate assets of MGM Grand Las Vegas and Mandalay Bay (including Mandalay Place) were contributed to the newly formed MGP BREIT Venture. In exchange for the contribution of the real estate assets, the Company received total consideration of $4.6 billion, which was comprised of $2.5 billion of cash, $1.3 billion of the Operating Partnership’s secured indebtedness assumed by MGP BREIT Venture, and the Operating Partnership’s 50.1% equity interest in MGP BREIT Venture. In addition, the Operating Partnership issued approximately 3 million Operating Partnership units to the Company representing 5% of the equity value of MGP BREIT Venture. The Company recorded the difference between consideration received of $2.5 billion and the carrying value of the MGM Grand Las Vegas real estate assets of $733 million and selling costs of $27 million as a net gain on sale of assets of $1.7 billion, which is reflected within “Gain on REIT transactions, net” in the consolidated statements of operations. The Company also recorded the difference between consideration received of $2.1 billion and the carrying value of the Mandalay Bay real estate assets of $2.3 billion and selling costs of $10 million as a net loss on sale of assets of $252 million, which is reflected within “Gain on REIT transactions, net” in the consolidated statements of operations. In connection with the transactions, the Company provides a shortfall guarantee of the principal amount of indebtedness of MGP BREIT Venture (and any interest accrued and unpaid thereon) as further discussed in Note 12. On the closing date, BREIT also purchased approximately 5 million MGP Class A shares for $150 million.

In connection with the MGP BREIT Venture Transaction, MGP BREIT Venture entered into a lease with a subsidiary of the Company for the real estate assets of Mandalay Bay and MGM Grand Las Vegas as further discussed in Note 11. Additionally, the master lease with MGP was modified to remove the Mandalay Bay property and the annual cash rent under the MGP master lease was reduced by $133 million, as further discussed in Note 18.

Also, on January 14, 2020, the Company, the Operating Partnership, and MGP entered into an agreement for the Operating Partnership to waive its right following the closing of the MGP BREIT Venture Transaction to issue MGP Class A shares, in lieu of cash, to the Company in connection with the Company exercising its right to require the Operating Partnership to redeem Operating Partnership units that the Company holds, at a price per unit equal to a 3% discount to the ten day average closing price prior to the date of the notice of redemption. The waiver was effective upon closing of the transaction on February 14, 2020 and was scheduled to terminate on the earlier of February 14, 2022 or upon the Company’s receipt of cash proceeds of $1.4 billion as consideration for the redemption of the Company’s Operating Partnership units. On May 18, 2020, the Operating Partnership redeemed approximately 30 million Operating Partnership units that the Company held for $700 million, or $23.10 per unit, and on December 2, 2020, the Operating Partnership redeemed approximately 24 million of the Operating Partnership units that the Company held for the remaining $700 million, or $29.78 per unit. As a result, the waiver terminated in accordance with its terms.

On March 4, 2021, certain subsidiaries of the Company delivered a notice of redemption to MGP covering approximately 37 million Operating Partnership units that they held, as further discussed in Note 13.

On August 4, 2021, the Company entered into an agreement with VICI Properties, Inc. (“VICI”) and MGP whereby VICI will acquire MGP in a stock-for-stock transaction (such transaction, the “VICI Transaction”). Pursuant to the agreement, MGP Class A shareholders will receive 1.366 shares of newly issued VICI stock in exchange for each MGP Class A share outstanding and the Company will receive 1.366 units of the new VICI operating partnership (“VICI OP”) in exchange for each Operating Partnership unit held by the Company. The fixed exchange ratio represents an agreed upon price of $43 per share of MGP Class A share to the five-day volume weighted average price of VICI stock as of the close of business on July 30, 2021. In connection with the exchange, VICI OP will redeem the majority of the Company’s VICI OP units for cash consideration of $4.4 billion, with the Company retaining an approximate $370 million ownership
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interest in the VICI OP (based upon the close price of VICI stock as of August 3, 2021). MGP’s Class B share that is held by the Company will be cancelled. As part of the transaction, the Company will enter into an amended and restated master lease with VICI. The new master lease will have an initial term of 25 years, with 3 10-year renewals, and initial annual rent of $860 million, escalating annually at a rate of 2% per annum for the first 10 years and thereafter equal to the greater of 2% and the CPI increase during the prior year subject to a cap of 3%. The transaction is expected to close in the first half of 2022, subject to customary closing conditions, regulatory approvals, and approval by VICI stockholders (which was obtained on October 29, 2021).

On September 26, 2021, the Company entered into an agreement to acquire the operations of The Cosmopolitan of Las Vegas ("The Cosmopolitan") for cash consideration of $1.625 billion, subject to customary working capital adjustments. Pursuant to the agreement, the Company is obligated to use its reasonable best efforts to obtain the requisite antitrust and gaming regulatory approvals. The agreement may be terminated by either party if the transaction has not closed on or before June 26, 2022, which date may be extended by either party to a date on or prior to September 26, 2022 under certain circumstances. The agreement contemplates a reverse termination fee of $500 million that is payable by the Company in the event that the parties are unable to obtain antitrust or gaming regulatory approval. Additionally, the Company will enter into a lease agreement for the real estate assets of The Cosmopolitan. The Cosmopolitan lease will have an initial term of 30 years with 3 subsequent 10-year renewal periods, exercisable at the Company’s option. The initial term of the lease provides for an initial annual cash rent of $200 million with a fixed 2% escalator for the first 15 years, and thereafter, an escalator equal to the greater of 2% and the CPI increase during the prior year, subject to a cap of 3%. Additionally, the lease will require the Company to spend a specified percentage of net revenues over a rolling 5-year period at the property on capital expenditures and for the Company to comply with certain financial covenants, which, if not met, would require the Company to maintain cash security or one or more letters of credit in favor of the landlord in an amount equal to rent for the succeeding 1-year period. The transaction is expected to close in the first half of 2022, subject to regulatory approvals and other customary closing conditions.

On September 27, 2021, the Company completed the acquisition of the 50% ownership interest in CityCenter Holdings, LLC ("CityCenter") held by Infinity World Development Corp ("Infinity World"), a wholly owned subsidiary of Dubai World, a Dubai, United Arab Emirates government decree entity. CityCenter is located between Bellagio and Park MGM and consists of Aria, an integrated casino, hotel and entertainment resort; and Vdara, a luxury condominium-hotel. Refer to Note 4 for additional information on this acquisition.

On September 28, 2021, the Company sold the real estate assets of Aria (including Vdara) to funds managed by The Blackstone Group Inc. ("Blackstone") for cash consideration of $3.89 billion and entered into a lease through which the real property is leased back to a subsidiary of the Company, as further discussed in Note 11.

On October 29, 2021, MGP acquired the real estate assets of MGM Springfield from the Company and MGM Springfield was added to the MGP master lease between the Company and MGP through which MGP leases back the real property to a subsidiary of the Company. Amendments toTransactions with MGP, including transactions under the MGP master lease, agreement provides forhave been eliminated in the CompanyCompany’s consolidation of MGP. Refer to lease the real estate assets of Borgata and MGM National Harbor from a subsidiary of the Operating Partnership. See Note 10, Note 13, and Note 18 for additional information related to MGP, its ownership and transactions, and certain other intercompany agreements and debt financing transactionsinformation.

On December 13, 2021, the Company entered into an agreement to sell the operations of The Mirage to an affiliate of Seminole Hard Rock Entertainment, Inc. ("Hard Rock") for cash consideration of $1.075 billion, subject to certain purchase price adjustments. Pursuant to the agreement, Hard Rock is obligated to use its reasonable best efforts to obtain the requisite antitrust and gaming regulatory approvals. The agreement may be terminated by either party if the closing has not occurred on or before December 13, 2022, which date may be extended by either party to March 13, 2023 under certain circumstances. The agreement contemplates a reverse termination fee of $322.5 million that is payable by Hard Rock to the Company in connection therewith.  

the event that the parties are unable to obtain antitrust or gaming regulatory approval. Upon closing, the master lease between the Company and VICI (or MGP in the event that the VICI Transaction is terminated) will be amended and restated to reflect a $90 million reduction in annual cash rent. The transaction is expected to close during the second half of 2022, subject to certain closing conditions, including, but not limited to, the consummation or termination of the VICI Transaction and receipt of regulatory approvals.


The Company has an approximate 56% controlling interest in MGM China Holdings Limited (together with its subsidiaries, “MGM China”), which owns MGM Grand Paradise, S.A. (“MGM Grand Paradise”). MGM Grand Paradise owns and operates the MGM Macau resort and MGM Cotai, 2 integrated casino, hotel and entertainment resorts in Macau, as well as the related gaming subconcession and land concessions.

Gaming in Macau is currently administered by the Macau Government through concessions awarded to three different concessionaires and three subconcessionaires, of which a subsidiary of MGM China, MGM Grand Paradise, is a subconcessionaire. In 2019, the expiration of MGM Grand Paradise’s subconcession term was extended from March 31, 2020 to June 26, 2022, consistent with the expiration of the other concessionaires and subconcessionaires. Pursuant to the
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Macau gaming law, upon reaching the maximum duration of 20 years, the term of the concessions may be extended one or more times by order of the Chief Executive, which period may not exceed, in total, 5 years. On January 14, 2022, the Macau Government disclosed the content of a bill to amend Macau gaming law, which followed a 45-day public consultation process regarding draft amendment proposals that were issued in September 2021. Under the bill the existing subconcessions will be discontinued and a maximum of six concessions will be awarded for a term to be specified in the concession contract that may not exceed 10 years and which may be extended by three years under certain circumstances. The bill is subject to debate and approval by the Macau Legislative Assembly. The approval of the new gaming law bill will precede the public tender for the awarding of new gaming concessions and to date the Macau Government has provided no indication as well asto whether the public tender will take place before expiry of the existing gaming concessions and subconcessions but acknowledged that it could consider the extension of the existing concessions and subconcessions beyond their current term if the public tender is held at a later date. Unless MGM Cotai, an integratedGrand Paradise's gaming subconcession is extended or legislation with regard to reversion of casino hotelpremises is amended the casino area premises and entertainment resort located on an 18 acre sitegaming-related equipment subject to reversion will automatically be transferred to the Macau Government upon expiration, and MGM China will cease to generate any revenues from such gaming operations. In addition, certain events relating to the loss, termination, rescission, revocation or modification of MGM Grand Paradise’s gaming subconcession in Macau, where such events have a material adverse effect on the Cotai Strip in Macau that opened on February 13, 2018. The Gaming Inspection and Coordination Bureaufinancial condition, business, properties, or results of Macau (“DICJ”) approved 100 gaming tables for the openingoperations of MGM CotaiChina, taken as a whole, may result in a special put option triggering event under MGM China’s senior notes and 25 additionalin an event of default under MGM China’s revolving credit facilities. MGM China continues to closely monitor developments regarding the retendering process or concession extensions including the issuance of guidance by the Macau Government. MGM China intends to respond proactively to all relevant Macau Government requirements when known relating to the process. Management cannot provide any assurance that the gaming tables effective for operation on January 1, 2019, forsubconcession will be extended beyond the current term or that it will be able to obtain a total of 125 gaming tablesconcession in aggregate. In addition, the DICJ approved the initial transfer of 77a public tender; however, management believes that MGM Grand Paradise will be successful in obtaining a gaming tables from MGM Macau to MGM Cotai.

concession when a public tender is held.


The Company owns 50% of and manages CityCenter Holdings,BetMGM, LLC (“CityCenter”BetMGM”), located between Bellagiowhich provides online sports betting and Monte Carlo.iGaming in certain jurisdictions in the United States. The other 50% of CityCenterBetMGM is owned by Infinity World Development Corp, a wholly owned subsidiary of Dubai World, a Dubai, United Arab Emirates government decree entity. CityCenter consists of Aria, an integrated casino, hotel and entertainment resort; Mandarin Oriental Las Vegas, a non-gaming boutique hotel; and Vdara, a luxury condominium-hotel. In addition, CityCenter features residential units in the Residences at Mandarin Oriental and Veer. See Note 7 and Note 18 for additional information related to CityCenter.

The Company and a subsidiary of Anschutz Entertainment Group, Inc. (“AEG”) each own 42.5% of the Las Vegas Arena Company, LLC (“Las Vegas Arena Company”), the entity which owns the T-Mobile Arena, and Athena Arena, LLC owns the remaining 15%. The Company manages the T-Mobile Arena, which is located on a parcel of the Company’s land between Frank Sinatra Drive and New York-New York, adjacent to the Las Vegas Strip. The T-Mobile Arena is a 20,000 seat venue designed to host world-class events – from mixed martial arts, boxing, basketball and bull riding, to high profile awards shows and top-name concerts, and is the home of the Vegas Golden Knights of the National Hockey League. Additionally, the Company leases the MGM Grand Garden Arena, located adjacent to the MGM Grand Las Vegas, to the Las Vegas Arena Company. See Note 7 for additional information regarding the Company’s investment in the Las Vegas Arena Company.

The Company also has a 50% interest in Grand Victoria. Grand Victoria is a riverboat casino in Elgin, Illinois; an affiliate of Hyatt Gaming owns the other 50% of Grand Victoria and also operates the resort. See Note 7 for additional information regarding the Company’s investment in Grand Victoria.

A subsidiary of the Company was awarded a casino license to build and operate MGM Springfield in Springfield, Massachusetts. MGM Springfield is in the process of being developed on approximately 14 acres of land in downtown Springfield. The Company’s plans for the resort currently include a casino with approximately 2,550 slots and 120 table games including poker; a 250-room hotel; 100,000 square feet of retail and restaurant space; 44,000 square feet of meeting and event space; and a 3,500 space parking garage, with an expected development and construction cost of approximately $960 million, excluding capitalized interest and land-related costs. Construction of MGM Springfield is expected to be completed in the third quarter of 2018.

Entain plc.


The Company has two3 reportable segments: domestic resortsLas Vegas Strip Resorts, Regional Operations and MGM China. See Note 17 for additional information about the Company’s segments.


Financial Impact of COVID-19. The spread of the novel 2019 coronavirus (“COVID-19”) and developments surrounding the global pandemic have had a significant impact on the Company’s business, financial condition, results of operations and cash flows in 2020 and 2021 and may continue to impact the Company's business in 2022 and thereafter. In March 2020, all of the Company’s domestic properties were temporarily closed pursuant to state and local government restrictions imposed as a result of COVID-19. Throughout the second and third quarters of 2020, all of the Company’s properties that were temporarily closed re-opened to the public, with temporary re-closures and re-openings occurring for certain of the Company’s properties or portions thereof into the first quarter of 2021. Upon re-opening, the properties continued to operate without certain amenities and subject to certain occupancy limitations, with restrictions varying by jurisdiction. Beginning in the latter part of the first quarter of 2021 and continuing into the second quarter of 2021, the Company’s domestic jurisdictions eased and removed prior operating restrictions, including capacity and occupancy limits, as well as social distancing policies.

Although all of the Company’s properties have re-opened, in light of the unpredictable nature of the pandemic, including the emergence and spread of COVID-19 variants, the properties may be subject to new operating restrictions and/or temporary, complete, or partial shutdowns in the future. At this time, the Company cannot predict whether jurisdictions, states or the federal government will adopt similar or more restrictive measures in the future than in the past, including stay-at-home orders or the temporary closure of all or a portion of the Company’s properties as a result of the pandemic.

In Macau, following a temporary closure of the Company’s properties on February 5, 2020, operations resumed on February 20, 2020, subject to certain health safeguards, such as limiting the number of seats available at each table game, slot machine spacing, reduced operating hours at a number of restaurants and bars, temperature checks, and mask protection. Although the issuance of tourist visas (including the individual visit scheme) for residents of Zhuhai, Guangdong Province and all other provinces in mainland China to travel to Macau resumed on August 12, 2020, August 26, 2020 and September 23, 2020, respectively, several travel and entry restrictions in Macau, Hong Kong and mainland China remain in place (including the temporary suspension of ferry services between Hong Kong and Macau, the negative nucleic acid test result certificate, and mandatory quarantine requirements for returning residents, for visitors from Hong Kong, Taiwan, and certain regions in mainland China, and bans on entry on other visitors), which significantly impacted visitation to the Company’s Macau properties. In the third and fourth quarters of 2021, local COVID-19 cases were identified in Macau. Upon such occurrences, a state of immediate prevention was declared and mass mandatory nucleic acid testing was imposed in Macau, the validity period of negative test results for re-entry into mainland China was shortened and quarantine requirements were imposed, certain events were cancelled or suspended, and in some instances,
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certain entertainment and leisure facilities were closed throughout Macau. Although gaming and hotel operations have remained open during these states of immediate prevention, such measures have had a negative effect on the Company's operations and it is uncertain whether further closures, including the closure of the Company’s properties, or travel restrictions to Macau will be implemented if additional local COVID-19 cases are identified.

NOTE 2 — BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation. For entities not determined to be a variable interest entity (“VIE”), the Company consolidates such entities in which the Company owns 100% of the equity. For entities in which the Company owns less than 100% of the equity interest, the Company consolidates the entity if it has the direct or indirect ability to control the entities’ activities based upon the terms of the respective entities’ ownership agreements. For these entities, the Company records a noncontrolling interest in the consolidated balance sheets. The Company’s investments in unconsolidated affiliates which are 50% or less owned are accounted for under the equity method when the Company can exercise significant influence over or has joint control of the unconsolidated affiliate. All intercompany balances and transactions are eliminated in consolidation.

The Company evaluates entities for which control is achieved through means other than voting rights to determine if it is the primary beneficiary of a VIE.variable interest entity (“VIE”). A VIE is an entity in which either (i) the equity investors as a group, if any, lack the power through voting or similar rights to direct the activities of such entity that most significantly impact such entity’s economic performance or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. The Company identifies the primary beneficiary of a VIE as the enterprise that has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance; and (ii) the obligation to absorb losses or receive benefits of the VIE that could potentially be significant to the entity. The Company consolidates its investment in a VIE when it determines that it is its primary beneficiary. For these VIEs, the Company records a noncontrolling interest in the consolidated balance sheets. The Company may change its original assessment of a VIE upon subsequent events such as the modification of contractual arrangements that affect the characteristics or adequacy of the entity’s equity investments at risk and the disposition of all or a portion of an interest held by the primary beneficiary. The Company performs this analysis on an ongoing basis.

basis.

Management has determined that MGP is a VIE because the Class A equity investors as a group lack the power through voting or similar rights to direct the activities of such entity that most significantly impact such entity’s economic performance. The Company has determined that it is the primary beneficiary of MGP and consolidates MGP because (i) its ownership of MGP’s single Class B share entitles it to a majority of the total voting power of MGP’s shares, and (ii) the exchangeable nature of the Operating Partnership units owned provide the Company the right to receive benefits from MGP that could potentially be significant to MGP. The Company has recorded MGP’s ownership interest in the Operating Partnership of 26.6% as of December 31, 2017 as noncontrolling interest in the Company’s consolidated financial statements. As of December 31, 2017,2021, on a consolidated basis MGP had total assets of $10.4 billion, primarily related to its real estate investments, and total liabilities of $4.3$5.1 billion, primarily related to its indebtedness.

Reclassifications.

Management has determined that Bellagio BREIT Venture is a VIE because the equity holders as a group lack the power through voting or similar rights to direct the activities of such entity that most significantly impact such entity’s economic performance. The Company has determined that it is not the primary beneficiary of Bellagio BREIT Venture and, accordingly, does not consolidate the venture, because the Company does not have power to direct the activities that could potentially be significant to the venture; BREIT, as the managing member, has such power. The Company has recorded its 5% ownership interest in Bellagio BREIT Venture as an investment in unconsolidated affiliates in the Company’s consolidated financial statements, for which such amount was $58 million as of December 31, 2021. The Company’s maximum exposure to loss as a result of its involvement with Bellagio BREIT Venture is equal to the carrying value of its investment, assuming no future capital funding requirements, plus the exposure to loss resulting from the Company’s guarantee of the debt of Bellagio BREIT Venture, which guarantee is immaterial as of December 31, 2021, as further discussed in Note 12.
For entities determined not to be a VIE, the Company consolidates such entities in which the Company owns 100% of the equity. For entities in which the Company owns less than 100% of the equity interest, the Company consolidates the entity under the voting interest model if it has a controlling financial interest based upon the terms of the respective entities’ ownership agreements, such as MGM China. For these entities, the Company records a noncontrolling interest in the consolidated balance sheets and all intercompany balances and transactions are eliminated in consolidation. If the entity does not qualify for consolidation under the voting interest model and the Company has significant influence over the operating and financial decisions of the entity, the Company accounts for the entity under the equity method, such as the Company’s investments in MGP BREIT Venture and BetMGM, which do not qualify for consolidation as the Company has joint control, given the entities are structured with substantive participating rights whereby both owners participate in the decision making process, which prevents the Company from exerting a controlling financial interest in such entities, as defined in ASC 810.
For equity interests in entities in which the Company does not have significant influence, the Company records its equity investment under ASC 321 and reflects such investments within “Other long-term assets, net” on the consolidated balance sheets. The fair value of such equity investments was $66 million as of December 31, 2021.
Reclassifications. Certain reclassifications have been made to conform the prior period presentation.

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Management’s use of estimates. The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. These principles require the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.


Fair value measurements. Fair value measurements affect the Company’s accounting and impairment assessments of its long-lived assets, investments in unconsolidated affiliates cost method investments,or equity interests, assets acquired, and liabilities assumed in an acquisition, and goodwill and other intangible assets. Fair value measurements also affect the Company’s accounting for certain of its financial assets and liabilities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured according to a hierarchy that includes: Level 1 inputs, such as quoted prices in an active market; Level 2 inputs, which are observable inputs for similar assets; or Level 3 inputs, which are unobservable inputs.The Company used the following inputs in its fair value measurements:


•Level 1 inputs when measuring its equity investments under ASC 321;

•Level 1 and Level 2 inputs for its long-term debt fair value disclosures. See Note 10;

9;
•Level 2 inputs when measuring the Operating Partnership’s fair value of its interest rate swaps. See Note 9;

•Level 1, Level 2, and Level 3 inputs when assessing the fair value of assets acquired and liabilities assumed duringin the Borgata transaction.CityCenter acquisition. See Note 4;

and

•Level 2 and Level 3 inputs when measuring the impairment of goodwill related to the MGM China reporting unit. See Note 8; and

Level 3 inputs when assessing the fair value of its investment in Grand Victoria.the note receivable relating to the Circus Circus Las Vegas and adjacent land sale. See Note 7

16.

Cash and cash equivalents. Cash and cash equivalents include cash on hand, investments and interest bearinginterest-bearing instruments with maturities of 90 days or less at the date of acquisition. Such investments are carried at cost, which approximates market value. Book overdraft balances resulting from the Company’s cash management program are recorded as accounts payable“Accounts payable” or construction payable“Construction payable” as applicable.


Restricted cash. Restricted cash reflects cash held in an escrow account related to the reverse termination fee that was contractually required to be prefunded for The Cosmopolitan acquisition and is reflected as "Restricted Cash" on the consolidated balance sheets as of December 31, 2021. "Restricted Cash" and "Cash and cash equivalents" on the consolidated balance sheets as of December 31, 2021 equal "Cash, cash equivalents, and restricted cash" on the consolidated statements of cash flows.

Accounts receivable and credit risk. Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of casino accounts receivable. The Company issues credit to approved casino customers and gaming promoters following background checks and investigations of creditworthiness. At December 31, 2017, 35%2021 and 2020, approximately 43% and 52%, respectively, of the Company’s gross casino receivables at its domestic resortsaccounts receivable were dueowed by customers from customers residing in foreign countries, and 8% of the Company’s casino receivables related to MGM China.primarily within Asia. Business or economic conditions or other significant events in these countries could affect the collectability of such receivables.


Accounts receivable are typically non-interest bearing and are initially recorded at cost. Accounts are written off when management deems the account to be uncollectible. Recoveries of accounts previously written off are recorded when received. An estimated allowance for doubtful accountsloss reserve is maintained to reduce the Company’s receivables to their net carrying amount, which approximates fair value. The allowanceloss reserve is estimated based on both a specific review of customer accounts as well as historical collection experience and current and expected future economic and business conditions. Management believes that as of December 31, 2017,2021, no significant concentrations of credit risk existed for which an allowancea loss reserve had not already been recorded.


Inventories. Inventories consist primarily of food and beverage, retail merchandise and operating supplies, and are stated at the lower of cost or net realizable value. Cost is determined primarily using the average cost method for food and beverage and operating supplies. Cost for retail merchandise is determined using the cost method.



Property and equipment. Property and equipment are stated at cost. A significant amount of the Company’s property and equipment was acquired through business combinations and therefore recognized at fair value at the acquisition date. Gains or losses on dispositions of property and equipment are included in the determination of income or loss. Maintenance costs are expensed as incurred. As of December 31, 2017 and 2016, the Company had accrued $28 million and $36 million for property and equipment within accounts payable and $34 million and $32 million related to construction retention within other long-term liabilities, respectively.


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Property and equipment are generally depreciated over the following estimated useful lives on a straight-line basis:


Buildings and improvements

2015 to 40 years

Land improvements

10 to 20 years

Furniture and fixtures

3 to 20 years

Equipment

3 to 15 years


The Company evaluates its property and equipment and other long-lived assets for impairment based on its classification as held for sale or to be held and used. Several criteria must be met before an asset is classified as held for sale, including that management with the appropriate authority commits to a plan to sell the asset at a reasonable price in relation to its fair value and is actively seeking a buyer. For assets held for sale, the Company recognizes the asset at the lower of carrying value or fair market value less costs to sell, as estimated based on comparable asset sales, offers received, or a discounted cash flow model. For assets to be held and used, the Company reviews for impairment whenever indicators of impairment exist. The Company then compares the estimated future cash flows of the asset, on an undiscounted basis, to the carrying value of the asset. If the undiscounted cash flows exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying value, then an impairment charge is recorded based on the fair value of the asset, typically measured using a discounted cash flow model. If an asset is still under development, future cash flows include remaining construction costs. All recognized impairment losses, whether for assets held for sale or assets to be held and used, are recorded as operating expenses.

Refer to Note 16 for discussion on the impairment loss recorded on Circus Circus Las Vegas and adjacent land in 2019.


Capitalized interest. The interest cost associated with major development and construction projects is capitalized and included in the cost of the project. When no debt is incurred specifically for a project, interest is capitalized on amounts expended on the project using the weighted-averageweighted average cost of the Company’s outstanding borrowings. Capitalization of interest ceases when the project is substantially complete, or development activity is suspended for more than a brief period.


Investments in and advances to unconsolidated affiliates. The Company has investments in unconsolidated affiliates accounted for under the equity method. Under the equity method, carrying value is adjusted for the Company’s share of the investees’ earnings and losses, amortization of certain basis differences, as well as capital contributions to and distributions from these companies. Distributions in excess of equity method earnings are recognized as a return of investment and recorded as investing cash inflows in the accompanying consolidated statements of cash flows. The Company classifies operating income and losses as well as gains and impairments related to its investments in unconsolidated affiliates as a component of operating income or loss and classifies non-operating income or losses related to its investments in unconsolidated affiliates as a component of non-operating income or loss, as the Company’s investments in such unconsolidated affiliates are an extension of the Company’s core business operations.


The Company evaluates its investments in unconsolidated affiliates for impairment whenever events or changes in circumstances indicate that the carrying value of its investment may have experienced an “other-than-temporary”other-than-temporary decline in value. If such conditions exist, the Company compares the estimated fair value of the investment to its carrying value to determine if an impairment is indicated and determines whether the impairment is “other-than-temporary” based on its assessment of all relevant factors, including consideration of the Company’s intent and ability to retain its investment. The Company estimates fair value using a discounted cash flow analysis based on estimated future results of the investee and market indicators of terminal year capitalization rates, and a market approach that utilizes business enterprise value multiples based on a range of multiples from the Company’s peer group. See Note 7 and Note 16 for results of the Company’s review of its investment in certain of its unconsolidated affiliates.


Goodwill and other intangible assets. Goodwill represents the excess of purchase price over fair market value of net assets acquired in business combinations. Goodwill and indefinite-lived intangible assets must be reviewed for impairment at least annually and between annual test dates in certain circumstances. The Company performs its annual impairment tests in the fourth quarter of each fiscal year. No material impairments were indicated or recorded as a result of the annual impairment review for goodwill and indefinite-lived intangible assets in 20172021, 2020, and 2016. An impairment of goodwill related to the MGM China reporting unit was recorded as a result of the annual impairment review in 2015. See Note 8.

2019.


Accounting guidance provides entities the option to perform a qualitative assessment of goodwill and indefinite-lived intangible assets (commonly referred to as “step zero”) in order to determine whether further impairment testing is necessary. In performing the step zero analysis the Company considers macroeconomic conditions, industry and market considerations, current and forecasted financial performance, entity-specific events, and changes in the composition or carrying amount of net assets of reporting units for


goodwill. In addition, the Company takes into consideration the amount of excess of fair value over carrying value determined in the last quantitative analysis that was performed, as well as the

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period of time that has passed since the last quantitative analysis. If the step zero analysis indicates that it is more likely than not that the fair value is less than its carrying amount, the entity would proceed to a quantitative analysis.


Under the quantitative analysis, goodwill for relevant reporting units is tested for impairment using a discounted cash flow analysis based on the estimated future results of the Company’s reporting units discounted using market discount rates and market indicators of terminal year capitalization rates, and a market approach that utilizes business enterprise value multiples based on a range of multiples from the Company’s peer group. Effective January 1, 2017,If the Company prospectively adopted accounting guidance that simplifies goodwill impairment testing by eliminating the requirement to calculate the implied fair value of goodwill (formerly “Step 2”) in the event that impairmentreporting unit is identified. Instead,less than its carrying value, an impairment charge is recognized forequal to the amount by which the carrying value exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to that reporting unit.difference. Under the quantitative analysis, license rights are tested for impairment using a discounted cash flow approach, and trademarks are tested for impairment using the relief-from-royalty method. If the fair value of an indefinite-lived intangible asset is less than its carrying amount, an impairment loss is recognized equal to the difference.


Revenue recognitionrecognition. The Company’s revenue from contracts with customers consists of casino wagers transactions, hotel room sales, food and promotional allowances. Casino revenuebeverage transactions, entertainment shows, and retail transactions.

The transaction price for a casino wager is the aggregate net difference between gaming wins and losses (“net win”). In certain circumstances, the Company offers discounts on markers, which is estimated based upon historical business practice, and recorded as a reduction of casino revenue. Commissions rebated to gaming promoters and VIP players at MGM China are also recorded as a reduction of casino revenue. The Company accounts for casino revenue on a portfolio basis given the similar characteristics of wagers by recognizing net win per gaming day versus on an individual wager basis.

For casino wager transactions that include other goods and services provided by the Company to gaming patrons on a discretionary basis to incentivize gaming, the Company allocates revenue from the casino wager transaction to the good or service delivered based upon standalone selling price (“SSP”). Discretionary goods and services provided by the Company and supplied by third parties are recognized as an operating expense.

For casino wager transactions that include incentives earned by customers under the Company’s loyalty programs, the Company allocates a portion of net win based upon the SSP of such incentive (less estimated breakage). This allocation is deferred and recognized as revenue when the customer redeems the incentive. When redeemed, revenue is recognized in the department that provides the goods or service. Redemption of loyalty incentives at third-party outlets are deducted from the loyalty liability and amounts owed are paid to the third party, with any discount received recorded as other revenue. After allocating revenue to other goods and services provided as part of casino wager transactions, the Company records the residual amount to casino revenue.

The transaction price of rooms, food and beverage, and retail contracts is the net amount collected from the customer for such goods and services. The transaction price for such contracts is recorded as revenue when the good or service is transferred to the customer over their stay at the hotel or when the delivery is made for the food & beverage and retail & other contracts. Sales and usage-based taxes are excluded from revenues. For some arrangements, the Company acts as an agent in that it arranges for another party to transfer goods and services and the Company is not the controlling entity, which primarily include certain of the Company’s entertainment shows and, in certain jurisdictions, the Company’s arrangement with BetMGM for online sports betting and iGaming.

The Company also has other contracts that include multiple goods and services, such as packages that bundle food, beverage, or entertainment offerings with hotel stays and convention services. For such arrangements, the Company allocates revenue to each good or service based on its relative SSP. The Company primarily determines the SSP of rooms, food and beverage, entertainment, and retail goods and services based on the amount that the Company charges when sold separately in similar circumstances to similar customers.

Contract and Contract-Related Liabilities. There may be a difference between the timing of cash receipts from the customer and the recognition of revenue, resulting in a contract or contract-related liability. The Company generally has three types of liabilities recognizedrelated to contracts with customers: (1) outstanding chip liability, which represents the amounts owed in exchange for gaming chips held by a customer, (2) loyalty program obligations, which represents the deferred allocation of revenue relating to loyalty program incentives earned, as discussed above, and (3) customer advances and other, which is primarily funds deposited by customers before gaming play occurs (“casino front money”) and for chips in the customers’ possession (“outstanding chip liability”). Hotel, foodadvance payments on goods and beverage, entertainment, retailservices yet to be provided such as advance ticket sales and other operating revenues are recognized as services are performed and goods are provided. Advance deposits on rooms and advance ticket salesconvention space or for unpaid wagers. These liabilities are generally expected to be recognized as revenue within one year of being purchased, earned, or deposited and are recorded aswithin “Other accrued liabilities until services are providedliabilities” on the consolidated balance sheets.

74

The following table summarizes the activity related to the customer.

Gaming revenues are recognized net of certain sales incentives, including discountscontract and points earned in point-loyalty programs. The retail value of hotel rooms, food and beverage, and other services furnished to guests without charge is included in gross revenue and then deducted as promotional allowances. The estimated cost of providing promotional allowances is primarily included in casino expenses as follows:

contract-related liabilities:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Rooms

 

$

139,992

 

 

$

120,369

 

 

$

112,313

 

Food and beverage

 

 

324,554

 

 

 

283,598

 

 

 

279,041

 

Entertainment, retail and other

 

 

42,357

 

 

 

39,611

 

 

 

39,388

 

 

 

$

506,903

 

 

$

443,578

 

 

$

430,742

 


Gaming promoters. A significant portion of the high-end (“VIP”) gaming volume at MGM Macau is generated through the use of gaming promoters, also known as junket operators. These operators introduce VIP gaming players to MGM Macau, assist these customers with travel arrangements, and extend gaming credit to these players. VIP gaming at MGM Macau is conducted by the use of special purpose nonnegotiable gaming chips. Gaming promoters purchase these nonnegotiable chips from MGM Macau and in turn sell these chips to their players. The nonnegotiable chips allow MGM Macau to track the amount of wagering conducted by each gaming promoter’s clients in order to determine VIP gaming play volume, or rolling chip turnover, which is the amount of nonnegotiable chips wagered and lost. In exchange for the gaming promoters’ services, MGM Macau compensates the gaming promoters through revenue-sharing arrangements and rolling chip turnover-based commissions. The estimated portion of the gaming promoter commissions that represent amounts passed through to VIP customers is recorded as a reduction of casino revenue, and the estimated portion retained by the gaming promoter for its compensation is recorded as casino expense.

 Outstanding Chip LiabilityLoyalty ProgramCustomer Advances and Other
 2021 20202021202020212020
 (in thousands)
Balance at January 1$212,671 $314,570 $139,756 $126,966 $382,287 $481,095 
Balance at December 31176,219 212,671 144,465 139,756 640,001 382,287 
Increase / (decrease)$(36,452)$(101,899)$4,709 $12,790 $257,714 $(98,808)

Reimbursed costs. The Company recognizes costscost. Costs reimbursed pursuant to management services are recognized as revenue in the period it incurs the costs.costs as this reflects when the Company performs its related performance obligation and is entitled to reimbursement. Reimbursed costs related primarily to the Company’s management of CityCenter.

Loyalty programs. CityCenter (such management agreement was terminated upon the acquisition of CityCenter in September 2021).


Revenue by source. The Company presents the revenue earned disaggregated by the type or nature of the good or service (casino, room, food and beverage, and entertainment, retail and other) and by relevant geographic region within Note 17.

Leases. The Company determines if an arrangement is or contains a lease at inception or modification of the arrangement. An arrangement is or contains a lease if there are identified assets and the right to control the use of an identified asset is conveyed for a period of time in exchange for consideration. Control over the use of the identified asset means the lessee has both the right to obtain substantially all of the economic benefits from the use of the asset and the right to direct the use of the asset.

The Company classifies a lease with terms greater than twelve months as either operating or finance. At commencement date, the right-of-use (“ROU”) assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. The initial measurement of the operating lease ROU assets also includes any prepaid lease payments and are reduced by any previously accrued deferred rent. When available, such as for the Company’s primary loyalty program is “M life Rewards” and is availabletriple-net operating leases for which the lessor has provided its implicit rate or provided the assumptions required for the Company to patrons atreadily determine the rate implicit in the lease, the Company uses the rate implicit in the lease to discount lease payments to present value. However, for most of the Company’s domestic resorts and CityCenter. Members may earn points and/or Express Compsleases, such as its equipment leases, the Company cannot readily determine the implicit rate. Accordingly, the Company uses its incremental borrowing rate to discount the lease payments for their gaming play which can be redeemed at restaurants, box offices or the M life Rewards front desk at participating properties. Points may also be redeemed for free slot play on participating machines. The Company records a liabilitysuch leases based on the pointsinformation available at the commencement date. Lease terms include options to extend or terminate the lease when it is reasonably certain that such option will be exercised. The Company’s triple-net operating leases each contain renewal periods at the Company’s option, each of which are not considered to be reasonably certain of being exercised. Many of the Company’s leases include fixed rental escalation clauses that are factored into the determination of lease payments. For operating leases, lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease term. For finance leases, the ROU asset depreciates on a straight-line basis over the shorter of the lease term or useful life of the ROU asset and the lease liability accretes interest based on the interest method using the discount rate determined at lease commencement.

Refer to Note 11 for discussion of leases under which the Company is a lessee. The master lease agreement with MGP is eliminated in consolidation; refer to Note 18 for further discussion of the master lease with MGP.

The Company is a lessor under certain other lease arrangements. Lease revenues earned multiplied by the redemption value, less an estimate for points not expectedCompany from third parties are classified within the line item corresponding to be redeemed,the type or nature of the tenant’s good or service. Lease revenues from third-party tenants include $43 million, $24 million and records a corresponding reduction in casino revenue. Customers also earn Express Comps based on their gaming play which can be redeemed for complimentary goods and services, including hotel rooms,$53 million recorded within food and beverage revenue for 2021, 2020 and entertainment. The Company records a liability2019, respectively, and $85 million, $60 million and $89 million recorded within entertainment, retail, and other revenue for the estimated costssame such periods, respectively. Lease revenues from the rental of providing goods and services for Express Comps based onhotel rooms are recorded as rooms revenues within the Express Comps earned multiplied by a cost margin, less an estimate for Express Comps not expected to be redeemed and records a corresponding expense in the casino department. MGM Macau also has loyalty programs, including M life Rewards as well as the Golden Lion Club, which provides benefits to customers focused on gaming.

consolidated statements of operations.


Advertising. The Company expenses advertising costs the first time the advertising takes place.as incurred. Advertising expense that primarily relates to media placement costs and which is generally included in general and administrative expenses, was $223$121 million, $171$88 million and $156$195 million for 2017, 20162021, 2020 and 2015,2019, respectively.


Corporate expense. Corporate expense represents unallocated payroll, aircraft costs, professional fees and various other expenses not directly related to the Company’s casino resort operations. In addition, corporate expense includes the costs associated with the Company’s evaluation and pursuit of new business opportunities, which are expensed as incurred.

75


Preopening and start-up expenses. Preopening and start-up costs, including organizational costs, are expensed as incurred. Costs classified as preopening and start-up expenses include payroll, outside services, advertising, and other expenses related to new or start-up operations.


Property transactions, net. The Company classifies transactions such as write-downs and impairments, demolition costs, and normal gains and losses on the sale of assets as “Property transactions, net.” See Note 16 for a detailed discussion of these amounts.


Redeemable noncontrolling interest. In 2015 and 2016, MGM National Harbor issuedCertain noncontrolling interest parties have non-voting economic interests in MGM National Harbor (“Interests”) to noncontrolling interest parties for a total aggregate purchase price of $53 million. The Interestswhich provide for annual preferred distributions by MGM National Harbor to the noncontrolling interest parties based on a percentage of its annual net gaming revenue (as defined in the MGM National Harbor operating agreement). Such distributions are accrued each quarter and are paid 90-days90 days after the end of each fiscal year.

Beginning on December 31, 2019 the The noncontrolling interest parties will each have the ability to require MGM National Harbor to purchase all or a portion of their Interestsinterests for a purchase price based on a contractually agreed upon formula. Additionally, certain noncontrolling interest parties each have the right to sell back all or a portion of their Interests prior to such date if MGM National Harbor were to guarantee or grant liens to secure any indebtedness of the Company or its affiliates other than the indebtedness of MGM National Harbor.


The Company has recorded the Interestsinterests as “Redeemable noncontrolling interests” in the mezzanine section of the accompanying consolidated balance sheets and not stockholders’ equity because their redemption is not exclusively in the Company’s control. InterestsThe interests were initially accounted for at fair value. Subsequently, the Company recognizes changes in the redemption value as they occur and adjusts the carrying amount of the redeemable noncontrolling interests to equal the maximum redemption value, provided such amount does not fall below the initial carrying value, at the end of each reporting period. The Company records any changes caused by such an adjustment in capital in excess of par value. Additionally, the carrying amount of the redeemable noncontrolling interests is adjusted for accrued annual preferred distributions, with changes caused by such adjustments recorded within net income (loss) attributable to noncontrolling interests.


Income (loss) per share of common stock. The table below reconciles basic and diluted income (loss) per share of common stock. Diluted net income (loss) attributable to common stockholders includes adjustments for redeemable noncontrolling interests and the potentially dilutive effect on the Company’s equity interests in MGP and MGM China due to shares outstanding under their respective stock compensation plans.interests. Diluted weighted-averageweighted average common and common equivalent shares include adjustments for potential dilution of share-based awards outstanding under the Company’s stock compensation plan.

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

Numerator:

 

(In thousands)

 

Net income (loss) attributable to MGM Resorts International

 

$

1,960,286

 

 

$

1,101,440

 

 

$

(447,720

)

Adjustment related to redeemable noncontrolling interests

 

 

(18,363

)

 

 

(28

)

 

 

—

 

Net income (loss) available to common stockholders - basic

 

 

1,941,923

 

 

 

1,101,412

 

 

 

(447,720

)

Potentially dilutive effect due to MGP Omnibus Plan

 

 

(90

)

 

 

(40

)

 

 

—

 

Potentially dilutive effect due to MGM China Share Option Plan

 

 

(178

)

 

 

(11

)

 

 

—

 

Net income (loss) attributable to common stockholders - diluted

 

$

1,941,655

 

 

$

1,101,361

 

 

$

(447,720

)

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding basic

 

 

572,253

 

 

 

568,134

 

 

 

542,873

 

Potential dilution from share-based awards

 

 

6,542

 

 

 

5,183

 

 

 

—

 

Weighted-average common and common equivalent shares - diluted

 

 

578,795

 

 

 

573,317

 

 

 

542,873

 

Antidilutive share-based awards excluded from the calculation of diluted

   earnings per share

 

 

2,601

 

 

 

4,207

 

 

 

18,276

 



 Year Ended December 31,
 202120202019
Numerator:(In thousands)
Net income (loss) attributable to MGM Resorts International$1,254,370 $(1,032,724)$2,049,146 
Adjustment related to redeemable noncontrolling interests(78,298)35,520 (2,713)
Net income (loss) available to common stockholders - basic1,176,072 (997,204)2,046,433 
Other— — (194)
Net income (loss) attributable to common stockholders - diluted$1,176,072 $(997,204)$2,046,239 
Denominator:
Weighted average common shares outstanding basic481,930 494,152 524,173 
Potential dilution from share-based awards5,426 — 3,472 
Weighted average common and common equivalent shares - diluted487,356 494,152 527,645 
Antidilutive share-based awards excluded from the calculation of diluted earnings per share198 9,493 1,617 

Currency translation. The Company translates the financial statements of foreign subsidiaries that are not denominated in U.S. dollars. Balance sheet accounts are translated at the exchange rate in effect at each balance sheet date. Income statement accounts are translated at the average rate of exchange prevailing during the period. Translation adjustments resulting from this process are recorded to other comprehensive income (loss).

Gains or losses from foreign currency remeasurements are recorded to other non-operating income (expense).


Accumulated other comprehensive income (loss). Comprehensive income (loss) includes net income (loss) and all other non-stockholder changes in equity, or other comprehensive income (loss). Elements of the Company’s accumulated other comprehensive income (loss) are reported in the accompanying consolidated statements of stockholders’ equity. Amounts reported in accumulated other comprehensive income related to cash flow hedges will be reclassified to interest expense as interest payments are made on our variable-rate debt. The following table summarizes the changes in the accumulated balance of other comprehensive income:

 

 

Currency Translation Adjustments

 

 

Cash Flow Hedges

 

 

Other

 

 

Total

 

 

 

(In thousands)

 

Balance, January 1, 2016

 

$

14,022

 

 

$

—

 

 

$

—

 

 

$

14,022

 

Other comprehensive income (loss) before reclassifications

 

 

(2,680

)

 

 

1,521

 

 

 

1,074

 

 

 

(85

)

Amounts reclassified from accumulated other comprehensive income to interest expense

 

 

—

 

 

 

358

 

 

 

—

 

 

 

358

 

Other comprehensive income (loss), net of tax

 

 

(2,680

)

 

 

1,879

 

 

 

1,074

 

 

 

273

 

Other comprehensive income (loss) attributable to noncontrolling interest

 

 

1,203

 

 

 

(445

)

 

 

—

 

 

 

758

 

Balance, December 31, 2016

 

 

12,545

 

 

 

1,434

 

 

 

1,074

 

 

 

15,053

 

Other comprehensive income (loss) before reclassifications

 

 

(43,188

)

 

 

(1,221

)

 

 

98

 

 

 

(44,311

)

Amounts reclassified from accumulated other comprehensive income (loss) to interest expense

 

 

—

 

 

 

9,216

 

 

 

—

 

 

 

9,216

 

Other comprehensive income (loss), net of tax

 

 

(43,188

)

 

 

7,995

 

 

 

98

 

 

 

(35,095

)

Other comprehensive income (loss) attributable to noncontrolling interest

 

 

19,193

 

 

 

(2,761

)

 

 

—

 

 

 

16,432

 

Balance, December 31, 2017

 

$

(11,450

)

 

$

6,668

 

 

$

1,172

 

 

$

(3,610

)


Recently issued accounting standards. In May 2014, the FASB issued ASC 606, “Revenue from Contracts with Customers (Topic 606)” which outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. Under the standard, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods and services.  

The Company adopted ASC 606 on a full retrospective basis, effective January 1, 2018, which will be reflected in future financial statements. The most significant impacts of adoption of the new accounting pronouncement are as follows:


Promotional Allowances: The Company is no longer permitted to recognize revenues for goods and services provided to customers for free as an inducement to gamble as gross revenue with a corresponding offset to promotional allowances to arrive at net revenues, and accordingly the promotional allowances line item will be removed in future filings. The majority of such amounts previously included in promotional allowances will now offset casino revenues based on stand-alone selling price. This change will primarily result in a reclassification of revenue between revenue line items;

76

Loyalty Accounting: Accounting for Express Comps granted under the M life Rewards program and points granted under the Golden Lion Club will be identified as separate performance obligations and recorded as a reduction in gaming revenues when earned at the retail value of such benefits owed to the customer (less estimated breakage) and an increase to the loyalty program liability representing outstanding performance obligations. Such amounts will be recognized as revenue in the line item of the corresponding good or service provided when the performance obligation is fulfilled. This change will result in a decrease to beginning retained earnings of approximately $41 million as a result of the initial application of the standard and will not have a significant impact to earnings;



•

Gaming Promoter Commission: Commissions paid to gaming promoters under MGM China’s incentive program will now be fully reflected as a reduction in casino revenue. This change will primarily result in a decrease in casino expense and a corresponding decrease in casino revenue;

Gross versus Net Presentation: Mandatory service charges on food and beverage and hotel offerings and wide area progressive operator fees will be recorded gross, that is, the amount received from the customer will be recorded as revenue with the corresponding amount paid as an expense. These changes will primarily result in an increase in revenue with a corresponding increase in expense;

Estimated Cost of Promotional Allowances: The Company will no longer reclassify the estimated cost of complimentaries provided to the gaming patron from other expense line items to the casino expense line item. This change will result in a reclassification of expense between expense line items which will reduce casino expense by $507 million, $444 million, and $431 million for the years ended December 31, 2017, 2016, and 2015, respectively, and increase Rooms, Food and beverage, Retail, Entertainment and Other expenses. Refer to the ‘Revenue recognition and promotional allowances’ section within this note for the historical amounts that will be reclassified back to each expense line item when the retrospective adoption to prior years is reflected in future filings.

These changes, and other less significant adjustments that were required upon adoption, will not have an aggregate material impact on operating income, net income, or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” (“ASU 2016-02”), which replaces the existing guidance in Accounting Standards Codification (“ASC”) 840, “Leases.” ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use (“ROU”) asset and a corresponding lease liability. For finance leases, the lessee would recognize interest expense and amortization of the ROU asset and for operating leases the lessee would recognize a straight-line total lease expense. The Company is currently assessing the impact the adoption of ASU 2016-02 will have on its consolidated financial statements and footnote disclosures.

In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force),” (“ASU 2016-15”), effective for fiscal years beginning after December 15, 2017. ASU 2016-15 amends the guidance of ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of ASU 2016-15 is to reduce the diversity in practice that has resulted from the lack of consistent principles, specifically clarifying the guidance on eight cash flow issues. The adoption of ASU 2016-15 did not have a material effect on the Company’s consolidated financial statements and footnote disclosures.

In January 2017, the Company adopted ASU No. 2016-09, “Compensation – Stock Compensation (Topic 718),” (“ASU 2016-09”). ASU 2016-09 simplifies the accounting for share-based payment transactions, including the income tax consequences, accounting for forfeitures, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 has separate transition guidance for each element of the new standard. The adoption of ASU 2016-09 did not have a material effect on the Company’s consolidated financial statements and footnote disclosures.

In January 2017, the Company adopted ASU No. 2016-17, “Consolidation (Topic 810): Interests Held Through Related Parties that are Under Common Control,” (“ASU 2016-17”). The amendments affect the evaluation of whether to consolidate a VIE in certain situations involving entities under common control. Specifically, the amendments change the evaluation of whether an entity is the primary beneficiary of a VIE for an entity that is a single decision-maker of a variable interest by changing how an entity treats indirect interests in the VIE held through related parties that are under common control with the reporting entity. The guidance in ASU 2016-17 must be applied retrospectively to all relevant periods. The adoption of ASU 2016-17 did not have a material effect on the Company’s consolidated financial statements and footnote disclosures.

In January 2017, the Company early adopted ASU No. 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the subsequent measurement of goodwill by eliminating step two from the goodwill impairment test. Under the amended guidance, the Company will perform its annual goodwill impairment tests (and interim tests if any are determined to be necessary) by comparing the fair value of its reporting units with their carrying value, and an impairment charge, if any, will be recognized for the amount by which the carrying value exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to that reporting unit. The adoption of ASU 2017-04 did not have a material effect on the Company’s consolidated financial statements and footnote disclosures.


NOTE 3 — ACCOUNTS RECEIVABLE, NET


Accounts receivable, net consisted of the following:

 

December 31,

 

 December 31,

 

2017

 

 

2016

 

 20212020

 

(In thousands)

 

 (In thousands)

Casino

 

$

343,869

 

 

$

332,443

 

Casino$380,907 $260,998 

Hotel

 

 

146,931

 

 

 

169,321

 

Hotel180,098 46,288 

Other

 

 

142,316

 

 

 

139,080

 

Other151,258 135,805 

 

 

633,116

 

 

 

640,844

 

 712,263 443,091 

Less: Allowance for doubtful accounts

 

 

(92,571

)

 

 

(97,920

)

Less: Loss reservesLess: Loss reserves(128,348)(126,589)

 

$

540,545

 

 

$

542,924

 

 $583,915 $316,502 


NOTE 4— BORGATA TRANSACTION

4 — ACQUISITIONS


CityCenter

On August 1, 2016,September 27, 2021, the Company completed the acquisition of Boyd Gaming Corporation’s (“Boyd Gaming”)Infinity World's 50% ownership interest in Borgata. Following the completionCityCenter for cash consideration of the acquisition of Boyd Gaming’s interest, MGP acquired Borgata’s real property from the Company and leased back the real property to a subsidiary of the Company.   

As part of the purchase and sale agreement, the Company agreed to pay Boyd Gaming half of any net amount received or utilized by the Company as it relates to the Atlantic City property tax refund owed to Borgata at the time of the transaction. After taking into account the contingent consideration paid related to the property tax refunds realized by Borgata through the finalization of purchase price accounting, cash paid to Boyd Gaming for its interest in Borgata was $604 million. As further discussed in Note 12, Borgata subsequently entered into a property tax reimbursement agreement in February 2017 with the Department of Community Affairs of the State of New Jersey and Atlantic City and received the settlement amount of $72 million in June 2017, half of which the Company paid Boyd Gaming, net of fees and expenses.  

$2.125 billion.


Through the acquisition, of Boyd Gaming’s interest in Borgata, the Company obtained 100% of the equity interests in BorgataCityCenter and therefore consolidated BorgataCityCenter as of August 1, 2016. The Company recognized 100% of the assets and liabilities of Borgata at fair value at the date of the acquisition.September 27, 2021. Prior to the acquisition, the Company held a 50% ownership interest, in Borgata, which was accounted for under the equity method. The fair value of the equity interests of BorgataCityCenter was determined by the transaction price and equaled approximately $1.2$4.25 billion. The carrying value of the Company’sCompany's equity method investment was significantly less than its share of the fair value of BorgataCityCenter at the acquisition date, resulting in a $430 millionnet gain of $1.6 billion upon consolidation, which is recognized as "Gain on consolidation of CityCenter, net" on the consolidated statements of operations.

On September 28, 2021, the Company sold the real estate assets of Aria (including Vdara) for cash consideration of $3.89 billion and entered into a lease agreement pursuant to which the Company leases back the real property. The Company classified the real estate assets as held for sale as of the acquisition date and accordingly measured the real estate assets at fair value less costs to sell, as reflected in the table below. See Note 11 for additional information regarding the lease.

The Company recognized 100% of the assets and liabilities of CityCenter at fair value at the date of the acquisition. Under the acquisition method, the fair value was allocated to the assets acquired and liabilities assumed in the transaction. The allocation ofCompany estimated fair value for substantially all of the assetsusing level 1 inputs, level 2 inputs, and liabilities has been finalized as of December 31, 2016.

level 3 inputs.


The following table sets forth the finalizedpurchase price allocation at December 31, 2016 (in thousands):

Fair value of assets acquired and liabilities assumed:

 

 

 

Current assets

$

112,221

 

Property and equipment and other long-term assets

 

1,373,567

 

Goodwill

 

386,892

 

Trade name

 

83,000

 

Customer list

 

22,000

 

Current liabilities

 

(122,743

)

Long-term debt

 

(583,187

)

Deferred taxes

 

(12,124

)

Other long-term obligations

 

(51,894

)

 

$

1,207,732

 

Fair value of assets acquired and liabilities assumed:
Cash and cash equivalents$335,396 
Receivables and other current assets106,417 
Property and equipment - real estate assets held for sale3,888,431 
Property and equipment323,093 
Trademarks180,000 
Goodwill1,397,338 
Other long-term assets13,923 
Accounts payable, accrued liabilities, and other current liabilities(201,093)
Debt(1,729,451)
Other long-term liabilities(64,054)
$4,250,000 

As discussed above, the


The Company recognized the identifiable intangible assets of BorgataCityCenter at fair value. Thevalue, which consisted of indefinite-lived trade name and customer relationship intangible assets did not have historical cost bases at Borgata. The estimated fair values of the intangible assets werenames, which was determined using methodologies under the income approachrelief from royalty method based on significant
77

inputs that were not observable.


Unfavorable lease liability. The Company has assumedgoodwill is primarily attributable to the liabilityprofitability of a seriesCityCenter in excess of ground leases for a totalidentifiable assets, of which approximately 11 acres of land on which the Borgata employee parking garage, public space expansion, rooms expansion, modified surface parking lot, beer garden and outdoor pool reside. The Company recorded an unfavorable lease liability of $1 million in “Current liabilities” and $47 million in “Other long-term obligations” for the excess contractual lease obligations over the market value50% of the leases, which will be amortized on a straight-line basis over the termgoodwill is deductible for income tax purposes. All of the lease contracts through December 2070. Both a market and income approach using Level 2 and Level 3 inputs were utilizedgoodwill was assigned to determine the fair value of these leases.

Deferred taxes. The Company recorded an additional net deferred tax liability of $89 million, of which $82 million and $7 million was recorded to income tax expense and goodwill, respectively. The net deferred tax liability represents the excess of the financial reporting amounts of the net assets of Borgata over their respective basis under U.S. and New Jersey tax law expected to be applied to taxable income in the periods such differences are expected to be realized.

Consolidated results. Borgata’sCompany’s Las Vegas Strip Resorts segment.


Results. CityCenter’s net revenue for the period from August 1, 2016September 27, 2021 through December 31, 20162021 was $348$367 million and operating income was $39 million and net income was $8 million.

Prowere $69 million and $68 million, respectively.


Unaudited pro forma information. The operating results for BorgataCityCenter are included in the accompanying consolidated statements of operations from the date of acquisition. The following unaudited pro forma consolidated financial information for the Company has been prepared assuming the Company’s acquisition of its controlling interest hashad occurred as of January 1, 20152020 and excludes the $430 million gain on consolidation discussed above. The pro forma information does not reflect transactions that occurred subsequent to acquisition, such as the subsequent sale-leaseback transaction or the repayment of CityCenter's assumed debt. The unaudited pro forma financial information below is not necessarily indicative of either future results of operations or results that might have been achieved had the acquisition been consummated as of January 1, 2015.

2020.

 

Year Ended December 31,

 

 

2016

 

 

2015

 

 

(In thousands, except per share data)

 

 

(unaudited)

 

Net revenues

$

9,940,176

 

 

$

9,993,718

 

Net income (loss) attributable to MGM Resorts International

 

819,278

 

 

 

(417,671

)

Basis net income (loss) per share

$

1.44

 

 

$

(0.77

)

Diluted net income (loss) per share

$

1.43

 

 

$

(0.77

)

Year Ended December 31,
20212020
(In thousands)
Net Revenues$10,153,603 $5,456,763 
Net income attributable to MGM Resorts International137,773 (1,041,271)

NOTE 5 — DISPOSITIONS


Empire City

On April 1, 2015,January 29, 2019, the Company closedacquired the salereal property and operations associated with Empire City for total consideration of Railroad Pass. At closing,approximately $865 million, plus customary working capital and other adjustments. The fair value of consideration paid included the Company received $8 million in cash proceeds. On April 30, 2015, the Company closed the saleissuance of Gold Strike and related assets in Jean, Nevada. At closing, the Company received $12approximately $266 millionin cash proceeds. On July 7, 2015, the Company entered into an agreement with Eldorado Resorts, Inc. to sell Circus Circus Reno, as well as the Company’s 50% interest in Silver Legacy and associated real property. On November 23, 2015, the Company closed the sale and received $80 million in cash proceeds and recorded a gain of $23 million related to the sale, classified within “Property transactions, net.” See Note 7 for further discussion of the sale of the Company’s 50% investmentcommon stock, the incurrence of a new bridge facility, and the remaining balance in Silver Legacy. Railroad Pass, Gold Strikecash. If Empire City is awarded a license for live table games on or prior to December 31, 2022 and Circus Circus Reno were not classified as discontinued operations because the Company concluded thataccepts such license by December 31, 2024, the sales did not have a major effect onCompany will pay additional consideration of $50 million. The acquisition expands the Company’s presence in the northeast region and greater New York City market. Subsequent to the Company’s acquisition, MGP acquired the developed real property associated with Empire City from the Company and Empire City was added to the master lease between the Company and MGP. See Note 18 for additional information.

For the period from January 29, 2019 through December 31, 2019, Empire City’s net revenue was $193 million, operating income was $12 million and net income was $36 million. Pro forma results of operations or its financialfor the acquisition have not been presented because it is not material to the consolidated results of operations.

Northfield

In April 2019, the Company acquired the membership interests of Northfield from MGP, and they do not represent a disposal of a major geographic segment or product line.

MGP retained the associated real estate assets. MGM Northfield Park was then added to the master lease between the Company and MGP. Refer to Note 18 for additional information.


78

NOTE 65 — PROPERTY AND EQUIPMENT, NET


Property and equipment, net consisted of the following:

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

 

(In thousands)

 

Land

 

$

6,531,701

 

 

$

6,530,988

 

Buildings, building improvements and land improvements

 

 

12,245,950

 

 

 

11,969,984

 

Furniture, fixtures and equipment

 

 

5,157,363

 

 

 

4,863,647

 

Construction in progress

 

 

3,950,635

 

 

 

2,628,603

 

 

 

 

27,885,649

 

 

 

25,993,222

 

Less: Accumulated depreciation

 

 

(8,250,190

)

 

 

(7,568,199

)

 

 

$

19,635,459

 

 

$

18,425,023

 



 December 31,
 20212020
 (In thousands)
Land$4,082,842 $4,081,029 
Buildings, building improvements and land improvements12,236,042 12,053,422 
Furniture, fixtures and equipment5,722,565 5,600,579 
Construction in progress421,445 170,957 
 22,462,894 21,905,987 
Less: Accumulated depreciation(8,179,310)(7,474,876)
Finance lease ROU assets, net151,909 200,980 
 $14,435,493 $14,632,091 


NOTE 76 — INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED AFFILIATES


Investments in and advances to unconsolidated affiliates consisted of the following:

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

 

(In thousands)

 

CityCenter Holdings, LLC – CityCenter (50%)

 

$

809,084

 

 

$

1,007,358

 

Elgin Riverboat Resort–Riverboat Casino – Grand Victoria (50%)

 

 

124,342

 

 

 

123,585

 

Las Vegas Arena Company, LLC (42.5%)

 

 

76,619

 

 

 

80,339

 

Other

 

 

24,116

 

 

 

9,161

 

 

 

$

1,034,161

 

 

$

1,220,443

 

 December 31,
 20212020
 (In thousands)
CityCenter (50% as of December 31, 2020)$— $441,893 
MGP BREIT Venture (50.1% owned by the Operating Partnership)816,756 810,066 
BetMGM (50%)41,060 27,310 
Other109,228 167,774 
 $967,044 $1,447,043 


The Company recorded its share of the net income (loss) from unconsolidated affiliates, including adjustments for basis differences, as follows:

 

Year Ended December 31,

 

 Year Ended December 31,

 

2017

 

 

2016

 

 

2015

 

 202120202019

 

(In thousands)

 

 (In thousands)

Income from unconsolidated affiliates

 

$

145,989

 

 

$

527,616

 

 

$

257,883

 

Income from unconsolidated affiliates$84,823 $42,938 $119,521 

Preopening and start-up expenses

 

 

—

 

 

 

(3,168

)

 

 

(3,475

)

Non-operating items from unconsolidated affiliates

 

 

(34,751

)

 

 

(53,139

)

 

 

(76,462

)

Non-operating items from unconsolidated affiliates(83,243)(103,304)(62,296)

 

$

111,238

 

 

$

471,309

 

 

$

177,946

 

 $1,580 $(60,366)$57,225 

CityCenter

Crystals sale. In April 2016,


The following table summarizes further information related to the Company’s share of operating income (loss) from unconsolidated affiliates:
 Year Ended December 31,
 202120202019
 (In thousands)
CityCenter (through September 26, 2021)$128,127 $(29,753)$128,421 
MGP BREIT Venture155,817 136,755 — 
BetMGM(211,182)(61,663)(15,804)
Other12,061 (2,401)6,904 
 $84,823 $42,938 $119,521 

MGP BREIT Venture distributions. During the years ended December 31, 2021 and 2020, the Operating Partnership received $94 million and $81 million, respectively, in distributions from MGP BREIT Venture.
79


BetMGM contributions. During the years ended December 31, 2021 and 2020, the Company contributed $225 million and $80 million to BetMGM, respectively.

CityCenter closedacquisition. The Company obtained 100% of the saleequity interests in CityCenter and therefore consolidated CityCenter as of Crystals September 27, 2021. Prior to the acquisition, the Company held a 50% ownership interest, which was accounted for approximately $1.1 billion. under the equity method. Refer to Note 4.

CityCenter distributions. During the year ended December 31, 2016,2020, CityCenter recognized a gain onpaid $101 million in distributions, of which the Company received its 50% share, or approximately $51 million. During the year ended December 31, 2019, CityCenter paid $180 million in distributions, of which the Company received its 50% share, or approximately $90 million.

CityCenter sale of Harmon land.In June 2021, CityCenter closed the sale of Crystals of $400its Harmon land for $80 million and theon which it recorded a $30 million gain. The Company recognizedrecorded a $401$50 million gain, which included $200$15 million representingof its 50% share of the gain recorded by CityCenter and $201$35 million representing the reversal of certain basis differences. The basis differences primarily related toin 2021.

Other. During the years ended December 31, 2021 and 2020, the Company recognized other-than-temporary impairment charges recorded on the Company’s investment in CityCenter that were allocated to Crystals’ building assets.

CityCenter distributions. In April 2017, CityCenter paid a $600of $22 million dividend, consisting of a $350and $64 million, dividend using proceeds from the upsized senior credit facilities and a $250 million dividend from cash on hand, of which $78 million was part of its annual dividend policy. MGM Resorts received its 50% share, or $300 million. In March 2016, a $90 million distribution was declared in accordance with CityCenter’s annual distribution policy and in April 2016, CityCenter declared a $990 million special distribution in connection with the Crystals sale. The Company’s $540 million share of such distributions was paid in May 2016. In April 2015, CityCenter declared a special distribution of $400 million, of which the Company received its 50% share of $200 million.

CityCenter litigation settlement. During the first quarter of 2015, CityCenter recognized a $160 million gain as a result of the final resolution of its construction litigation and related settlements, of which the Company recorded $80 million, its 50% share of the gain.

CityCenter credit facility. In April 2017, CityCenter completed a refinancing of its senior credit facility. The new senior credit facility consists of a $1.6 billion term loan B facility maturing in April 2024 and a $125 million revolving credit facility maturing in April 2022. The term loan B was issued at 99.5% and bears interest at LIBOR plus 2.50% with a LIBOR floor of 0.75%. The revolving facility bears interest at LIBOR plus 2.00%. The term loan B facility requires CityCenter to make amortization payments of 0.25% of the original principal balance at each quarter end.

Borgata

As discussed in Note 4, the Company acquired Boyd Gaming’s ownership interest in Borgata on August 1, 2016, and therefore began to consolidate Borgata beginning on that date. Prior thereto, the Company’s investment in Borgata was accounted for under the equity method.


Grand Victoria

At December 31, 2015, the Company reviewed the carrying value of its Grand Victoria investment for impairment due to a greater than anticipated decline in operating results resulting in part from a continued loss of market share to video gaming terminals, as well as a decrease in forecasted cash flows compared to the prior forecast. The Company used a blended discounted cash flow analysis and guideline public company method to determine the estimated fair value from a market participant’s viewpoint. Key assumptions includedrespectively, within “Property transactions, net” in the discounted cash flow analysis were estimatesconsolidated statements of future cash flows including outflows for capital expenditures, a long-term growth rate of 2% and a discount rate of 10.5%. Key assumptionsoperations related to investments in unconsolidated affiliates previously classified within “Other” in the guideline public company method included business enterprise value multiples selected based on the range of multiples“Investments in Grand Victoria’s peer group. As a result of the analysis, the Company determined that it was necessaryand advances to record an other-than-temporary impairment charge of $17 million at December 31, 2015, based on an estimated fair value of $123 million for the Company’s 50% interest. The Company performed a sensitivity analysis surrounding its long-term growth rate assumption and noted that if a long-term growth rate of 1.5% had been used, the resulting estimated fair value of the Company’s 50% interest in Grand Victoria would have been approximately $120 million. The Company intends to, and believes it will be able to, retain its investment in Grand Victoria; however, due to the extent of the shortfall and the Company’s assessment of the uncertainty of fully recovering its investment, the Company has determined that the impairment was other-than-temporary.  

Las Vegas Arena Company, LLC

Athena Arena transaction. On September 1, 2016, the Company and AEG each sold a 7.5% membership interest in the Las Vegas Arena Company, LLC to Athena Arena, LLC. As a result of this transaction, the Company received $15 million in proceeds and recorded a $3 million gain in “Property transactions, net”.

Arena financing. Asunconsolidated affiliates” table above.


Unconsolidated Affiliate Financial Information – CityCenter (as of December 31, 2017, the senior secured credit facility consisted2020 and through September 26, 2021) & MGP BREIT Venture

Summarized balance sheet information is as follows:
 December 31,
 20212020
 (In thousands)
Cash and cash equivalents$16 $96,758 
Property and equipment, net4,439,851 10,237,004 
Other assets, net193,184 256,813 
Debt, net2,994,782 4,715,997 
Other liabilities8,018 270,583 

Summarized results of a $129 million term loan A and a $50 million term loan B. The senior secured credit facility matures in September 2019, is secured by substantially all the assets of the Las Vegas Arena Company, and contains certain financial covenants which became applicable upon the opening of the T-Mobile Arena in April 2016. See Note 12 for discussion of the Company’s repayment guarantee related to the Las Vegas Arena Company’s term loan B facility.

Silver Legacy

Silver Legacy sale. As discussed in Note 5, the Company closed the sale of its 50% interest in Silver Legacy on November 23, 2015, received proceeds of $58 million, and recorded a gain of $20 million. The Company’s investment in Silver Legacy was not classifiedoperations are as discontinued operations because the Company concluded that the sale would not have a major effect on the Company’s operations or its financial results and it did not represent a disposal of a major geographic segment or product line.

follows:

 Year Ended December 31,
 202120202019
 (In thousands)
Net revenues$1,084,503 $869,638 $1,294,861 
Net income (loss)294,797 (43,749)69,143 

Basis Differences


The Company’s investments in unconsolidated affiliates do not equal the Company’s share of venture-level equity due to various basis differences. Basis differences related to depreciable assets are being amortized based on the useful lives of the related assets and liabilities, and basis differences related to non–depreciable assets, such as land and indefinite-lived intangible assets, are not being amortized. Basis differences relating to the Company's investment in CityCenter were resolved in connection with the consolidation of CityCenter in 2021.

80

Differences between the Company’s share of venture-level equity and investment balances are as follows:

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Venture-level equity attributable to the Company

 

$

2,660,644

 

 

$

2,883,324

 

Adjustment to CityCenter equity upon contribution of net assets by MGM Resorts

   International (1)

 

 

(532,501

)

 

 

(537,819

)

CityCenter capitalized interest (2)

 

 

206,065

 

 

 

215,467

 

CityCenter completion guarantee (3)

 

 

322,703

 

 

 

337,223

 

CityCenter deferred gain (4)

 

 

(219,561

)

 

 

(221,638

)

CityCenter capitalized interest on sponsor notes (5)

 

 

(40,258

)

 

 

(42,095

)

Other-than-temporary impairments of CityCenter investment (6)

 

 

(1,504,161

)

 

 

(1,555,509

)

Acquisition fair value adjustments net of other-than-temporary impairments of Grand Victoria investment (7)

 

 

99,619

 

 

 

99,619

 

Other adjustments

 

 

41,611

 

 

 

41,871

 

 

 

$

1,034,161

 

 

$

1,220,443

 

(1)

Primarily relates to land and fixed assets.

(2)

Relates to interest capitalized on the Company’s investment balance during development and construction stages.

 December 31,
 20212020
 (In thousands)
Venture-level equity attributable to the Company$961,787 $2,981,550 
Adjustment to CityCenter equity upon contribution of net assets by MGM Resorts International(1)
— (504,171)
CityCenter capitalized interest(2)
— 168,966 
CityCenter completion guarantee(3)
— 248,730 
CityCenter deferred gain(4)
— (208,204)
CityCenter capitalized interest on sponsor notes(5)
— (33,010)
Other-than-temporary impairments of CityCenter investment(6)
— (1,256,516)
Other adjustments5,257 49,698 
 $967,044 $1,447,043 

(1)Primarily related to land and fixed assets.

(3)

Created by contributions to CityCenter under the completion guarantee recognized as equity contributions by CityCenter split between the members.

(2)Related to interest capitalized on the Company’s investment balance during development and construction stages.

(4)

Relates to a deferred gain on assets contributed to CityCenter upon formation of CityCenter.

(3)Created by contributions to CityCenter under the completion guarantee recognized as equity contributions by CityCenter split between the members.

(5)

Relates to interest on the sponsor notes capitalized by CityCenter during development. Such sponsor notes were converted to equity in 2013.  

(4)Related to a deferred gain on assets contributed to CityCenter upon formation of CityCenter.

(6)

The impairment of the Company’s CityCenter investment includes $379 million of impairments allocated to land.

(5)Related to interest on the sponsor notes capitalized by CityCenter during development. Such sponsor notes were converted to equity in 2013.

(7)

Relates to indefinite-lived gaming license rights for Grand Victoria and other-than-temporary impairments of the Company’s investment in Grand Victoria.

(6)The impairment of the Company’s CityCenter investment included $352 million of impairments allocated to land.



NOTE 87 — GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill and other intangible assets consisted of the following:

 

December 31,

 

 

2017

 

 

2016

 

 December 31,

Goodwill:

 

(In thousands)

 

Domestic resorts

 

$

457,867

 

 

$

457,867

 

MGM China

 

 

1,348,664

 

 

 

1,359,252

 

20212020
(In thousands)
GoodwillGoodwill$3,480,997 $2,091,278 

 

$

1,806,531

 

 

$

1,817,119

 

Indefinite-lived intangible assets:

 

 

 

 

 

 

 

 

Indefinite-lived intangible assets:

Detroit development rights

 

$

98,098

 

 

$

98,098

 

Detroit development rights$98,098 $98,098 

Trademarks, license rights and other

 

 

312,022

 

 

 

312,022

 

MGM Northfield Park and Empire City racing and gaming licensesMGM Northfield Park and Empire City racing and gaming licenses280,000 280,000 
Trademarks and otherTrademarks and other479,238 299,238 

Total indefinite-lived intangible assets

 

 

410,120

 

 

 

410,120

 

Total indefinite-lived intangible assets857,336 677,336 

Finite-lived intangible assets:

 

 

 

 

 

 

 

 

Finite-lived intangible assets:

MGM Grand Paradise gaming subconcession

 

 

4,478,911

 

 

 

4,514,073

 

MGM Grand Paradise gaming subconcession4,516,532 4,541,990 

Less: Accumulated amortization

 

 

(1,180,908

)

 

 

(1,024,185

)

Less: Accumulated amortization(1,865,219)(1,697,481)

 

 

3,298,003

 

 

 

3,489,888

 

 2,651,313 2,844,509 

MGM Macau land concession

 

 

84,076

 

 

 

84,736

 

MGM National Harbor and MGM Springfield gaming licensesMGM National Harbor and MGM Springfield gaming licenses106,600 106,600 

Less: Accumulated amortization

 

 

(27,870

)

 

 

(23,817

)

Less: Accumulated amortization(26,209)(19,102)

 

 

56,206

 

 

 

60,919

 

 80,391 87,498 

MGM China customer lists

 

 

127,969

 

 

 

128,974

 

Borgata customer list

 

 

22,000

 

 

 

22,000

 

Less: Accumulated amortization

 

 

(145,569

)

 

 

(135,574

)

 

 

4,400

 

 

 

15,400

 

Maryland license, Massachusetts license and other intangible assets

 

 

136,127

 

 

 

136,127

 

Other finite-lived intangible assetsOther finite-lived intangible assets65,207 60,649 

Less: Accumulated amortization

 

 

(26,896

)

 

 

(24,748

)

Less: Accumulated amortization(37,862)(26,244)

 

 

109,231

 

 

 

111,379

 

 27,345 34,405 

Total finite-lived intangible assets, net

 

 

3,467,840

 

 

 

3,677,586

 

Total finite-lived intangible assets, net2,759,049 2,966,412 

Total other intangible assets, net

 

$

3,877,960

 

 

$

4,087,706

 

Total other intangible assets, net$3,616,385 $3,643,748 




81

Goodwill. A summary of changes in the Company’s goodwill by reportable segment is as follows for 2017 and 2016:

follows:

 

 

2017

 

 

 

Balance at

January 1

 

 

Acquisitions

 

 

Currency exchange

 

 

Balance at December 31

 

 

 

(In thousands)

 

Goodwill, net by reportable segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic resorts

 

$

457,867

 

 

$

—

 

 

$

—

 

 

$

457,867

 

MGM China

 

 

1,359,252

 

 

 

—

 

 

 

(10,588

)

 

 

1,348,664

 

 

 

$

1,817,119

 

 

$

—

 

 

$

(10,588

)

 

$

1,806,531

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2016

 

 

 

Balance at

January 1

 

 

Acquisitions

 

 

Currency exchange

 

 

Balance at December 31

 

 

 

(In thousands)

 

Goodwill, net by reportable segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Domestic resorts

 

$

70,975

 

 

$

386,892

 

 

$

—

 

 

$

457,867

 

MGM China

 

 

1,359,792

 

 

 

—

 

 

 

(540

)

 

 

1,359,252

 

 

 

$

1,430,767

 

 

$

386,892

 

 

$

(540

)

 

$

1,817,119

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 2021
 Balance at January 1AcquisitionsCurrency exchangeBalance at December 31
 (In thousands)
Goodwill, net by segment:    
Las Vegas Strip Resorts$30,452 $1,397,338 $— $1,427,790 
Regional Operations701,463 — — 701,463 
MGM China1,359,363 — (7,619)1,351,744 
 $2,091,278 $1,397,338 $(7,619)$3,480,997 

 2020
 Balance at January 1AcquisitionsCurrency exchangeBalance at December 31
 (In thousands)
Goodwill, net by segment:
Las Vegas Strip Resorts$30,452 $— $— $30,452 
Regional Operations701,463 — — 701,463 
MGM China1,352,649 — 6,714 1,359,363 
 $2,084,564 $— $6,714 $2,091,278 

Goodwill concerning domestic resorts relateswas recognized in 2021 related to the acquisition of Mirage Resorts in 2001, the acquisition of Mandalay Resort Group in 2005, and the acquisition of Borgata in August 2016. See Note 4 for goodwill recognized in connection with the Borgata transaction. The Company recognized goodwill resulting from its acquisition of a controlling50% ownership interest in MGM ChinaCityCenter, which is included in 2011.

MGM China Goodwill Impairment. During the fourth quarter of 2015, the Company conducted its annual impairment tests of goodwill by reviewing each of its reporting units, including its MGM China reporting unit. The step one goodwill analysis of the MGM China reporting unit indicated the fair value was less than its carrying value by 4%. The decreaseLas Vegas Strip Resorts, as further discussed in fair value resulted from a decrease in forecasted cash flows based on then current market conditions and a sustained decline in the enterprise value multiples of the MGM China reporting unit as well as the multiples of the reporting unit’s peer group.

As a result of the indication of impairment from its step one analysis, the Company performed a step two impairment analysis to measure the impairment loss. As such, the Company determined the fair values of all assets of the MGM China reporting unit, including its separately identifiable intangible assets. The fair values of each of the separately identifiable intangible assets exceeded their respective carrying values by a significant amount, leading to a lower implied fair value of goodwill. Therefore, the Company recorded a $1.5 billion non-cash impairment charge to reduce the historical carrying value of goodwill related to the MGM China reporting unit to its implied fair value. The carrying value of goodwill related to the MGM China reporting unit as of December 31, 2015 following the impairment charge was $1.4 billion.

Indefinite-lived intangible assets. The Company’s indefinite-lived intangible assets consist primarily of development rights in Detroit, trademarks of which $210 million related to the Mandalay Resort Group trademarks and trade names, and $83 million related to the Borgata trade name, and license rights.

Note 4.


MGM Grand Paradise gaming subconcession. Pursuant to the agreement dated JuneApril 19, 20042005 between MGM Grand Paradise and SJM Resorts S.A. ("SJMSA", formerly Sociedade de Jogos de Macau, S.A.), a gaming subconcession was acquired by MGM Grand Paradise for the right to operate casino games of chance and other casino games for a period of 15 years commencing on April 20, 2005.2005 through March 31, 2020. In March 2019, MGM Grand Paradise and SJMSA entered into a Subconcession Extension Contract (the “Extension Agreement”), pursuant to which the gaming subconcession was extended to June 26, 2022, which coincides with the current expiration of all the other concessions and subconcessions. MGM Grand Paradise paid the government of Macau approximately $25 million and paid SJMSA approximately $2 million as a contract premium for such extension. The Company cannot provide any assurance that the gaming subconcessionMGM Grand Paradise will be extended beyondawarded a gaming concession subsequent to the original termsexpiration of the agreement;its gaming subconcession; however, as further discussed in Note 1, management believes that the gaming subconcessionMGM Grand Paradise will be extended, given that the Cotai landsuccessful in obtaining a gaming concession agreement with the government extends significantly beyond the gaming subconcession. As such,when a public tender is held. Accordingly, as of December 31, 2021 and 2020, the Company is amortizingamortizes the gaming subconcession intangible asset on a straight-line basis over the initial term of the Cotai land concession ending inthrough January 2038.


MGM Macau land concession. National Harbor and MGM Grand Paradise entered into a contract with the Macau government to use the land under MGM Macau commencing from April 6, 2006. Springfield gaming licenses. The land use right has an initial term through April 6, 2031, subject to renewal for additional periods. The land concession intangible asset is amortized on a straight-line basis over the remaining initial contractual term.


Customer lists. The Company recognized an intangible asset related to MGM China’s customer lists, which was amortized on an accelerated basis over its estimated useful life of five years. The MGM China customer list intangible asset became fully amortized in 2016. The Company recognized an intangible asset related to the Borgata customer list, which is amortized on an accelerated basis over its estimated useful life of two years and five months.

Gaming licenses. The Company was granted a license to operate a casino in Maryland. The considerationfee paid to the State of Maryland for the license fee of $22 million is considered a finite-lived intangible asset that is amortized on a straight-line basis over a period of its initial term of 15 years, beginning in December 2016, when the casinoMGM National Harbor started operations. The Company was granted a license to operate a casino in Massachusetts. The considerationfee paid to the State of Massachusetts for the license fee of $85 million is considered a finite-lived intangible asset that will beis amortized over a period of 15 years, beginning upon the opening of the casino resort.

Other. The Company’s other finite–lived intangible assets consist primarily of lease acquisition costs amortized over the life of the related leases, and certain license rights amortized over their contractual life.  

in August 2018, when MGM Springfield started operations.

82

Total amortization expense related to intangible assets was $173$197 million, $180$194 million and $199$192 million for 2017, 2016,2021, 2020, and 2015,2019, respectively. EstimatedAs of December 31, 2021, estimated future amortization is as follows:

 

 

 

 

 

Years ending December 31,

 

(In thousands)

 

2018

 

$

176,432

 

2019

 

 

176,755

 

2020

 

 

176,755

 

2021

 

 

176,755

 

2022

 

 

176,755

 

Thereafter

 

 

2,584,388

 

 

 

$

3,467,840

 


Years ending December 31,(In thousands)
2022$190,257 
2023177,982 
2024175,995 
2025174,210 
2026172,424 
Thereafter1,868,181 
 $2,759,049 


NOTE 98 — OTHER ACCRUED LIABILITIES


Other accrued liabilities consisted of the following:

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

 

(In thousands)

 

Payroll and related

 

$

483,101

 

 

$

483,194

 

Advance deposits and ticket sales

 

 

149,698

 

 

 

148,707

 

Casino outstanding chip liability

 

 

597,753

 

 

 

227,538

 

Casino front money deposits

 

 

304,652

 

 

 

214,727

 

MGM China gaming promoter commissions

 

 

23,651

 

 

 

31,445

 

Other gaming related accruals

 

 

131,109

 

 

 

119,446

 

Taxes, other than income taxes

 

 

170,639

 

 

 

166,916

 

MGP Dividend

 

 

29,777

 

 

 

22,281

 

Other

 

 

178,340

 

 

 

180,272

 

 

 

$

2,068,720

 

 

$

1,594,526

 




 December 31,
 20212020
 (In thousands)
Contract and contract-related liabilities:
 Outstanding chip liability$176,219 $212,671 
 Loyalty program obligations144,465 139,756 
 Casino front money206,244 133,114 
 Advance deposits and ticket sales283,188 123,079 
 Unpaid wagers and other150,569 126,094 
Other accrued liabilities:
 Payroll and related429,797 327,644 
 Taxes, other than income taxes195,973 109,100 
 Operating Partnership interest rate swaps - current14,071 32,155 
 MGP dividend82,294 64,086 
 Operating lease liabilities - current (Refer to Note 11)
31,706 31,843 
 Finance lease liabilities - current (Refer to Note 11)
87,665 80,193 
 Other181,253 165,344 
$1,983,444 $1,545,079 


83

NOTE 109 — LONG-TERM DEBT


Long-term debt consisted of the following:

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Senior credit facility

 

$

372,500

 

 

$

250,000

 

Operating Partnership senior credit facility

 

 

2,091,375

 

 

 

2,133,250

 

MGM China credit facility

 

 

2,301,584

 

 

 

1,933,313

 

MGM National Harbor credit facility

 

 

—

 

 

 

450,000

 

$475 million 11.375% senior notes, due 2018

 

 

—

 

 

 

475,000

 

$850 million 8.625% senior notes, due 2019

 

 

850,000

 

 

 

850,000

 

$500 million 5.25% senior notes, due 2020

 

 

500,000

 

 

 

500,000

 

$1,000 million 6.75% senior notes, due 2020

 

 

1,000,000

 

 

 

1,000,000

 

$1,250 million 6.625% senior notes, due 2021

 

 

1,250,000

 

 

 

1,250,000

 

$1,000 million 7.75% senior notes, due 2022

 

 

1,000,000

 

 

 

1,000,000

 

$1,250 million 6% senior notes, due 2023

 

 

1,250,000

 

 

 

1,250,000

 

$1,050 million 5.625% Operating Partnership senior notes, due 2024

 

 

1,050,000

 

 

 

1,050,000

 

$500 million 4.50% Operating Partnership senior notes, due 2026

 

 

500,000

 

 

 

500,000

 

$500 million 4.625% senior notes, due 2026

 

 

500,000

 

 

 

500,000

 

$350 million 4.50% Operating Partnership senior notes, due 2028

 

 

350,000

 

 

 

—

 

$0.6 million 7% debentures, due 2036

 

 

552

 

 

 

552

 

$2.3 million 6.7% debentures, due 2096

 

 

2,265

 

 

 

2,265

 

 

 

 

13,018,276

 

 

 

13,144,380

 

Less: Premiums, discounts, and unamortized debt issuance costs, net

 

 

(109,182

)

 

 

(156,785

)

 

 

 

12,909,094

 

 

 

12,987,595

 

Less: Current portion

 

 

(158,042

)

 

 

(8,375

)

 

 

$

12,751,052

 

 

$

12,979,220

 

 December 31,
 20212020
 
 (In thousands)
Operating Partnership senior credit facility$50,000 $10,000 
MGM China first revolving credit facility360,414 770,034 
7.75% senior notes, due 20221,000,000 1,000,000 
6% senior notes, due 20231,250,000 1,250,000 
5.625% Operating Partnership senior notes, due 20241,050,000 1,050,000 
5.375% MGM China senior notes, due 2024750,000 750,000 
6.75% senior notes, due 2025750,000 750,000 
5.75% senior notes, due 2025675,000 675,000 
4.625% Operating Partnership senior notes, due 2025800,000 800,000 
5.25% MGM China senior notes, due 2025500,000 500,000 
5.875% MGM China senior notes, due 2026750,000 750,000 
4.5% Operating Partnership senior notes, due 2026500,000 500,000 
4.625% senior notes, due 2026400,000 400,000 
5.75% Operating Partnership senior notes, due 2027750,000 750,000 
5.5% senior notes, due 2027675,000 675,000 
4.75% MGM China senior notes, due 2027750,000 — 
4.5% Operating Partnership senior notes, due 2028350,000 350,000 
4.75% senior notes, due 2028750,000 750,000 
3.875% Operating Partnership senior notes, due 2029750,000 750,000 
7% debentures, due 2036552 552 
 12,860,966 12,480,586 
Less: Premiums, discounts, and unamortized debt issuance costs, net(90,169)(103,902)
 12,770,797 12,376,684 
Less: Current portion(1,000,000)— 
$11,770,797 $12,376,684 

Debt due within one year of the December 31, 2017 balance sheet was classified as long-term as the Company had both the intent and ability to refinance current maturities on a long-term basis under its revolving senior credit facilities, with the exception that $158 million related to MGM China’s term loan amortization payments in excess of available borrowings under the MGM China revolving credit facility were classified as current. Debt due within one year of the December 31, 2016 balance sheet was classified as long-term as the Company had both the intent and ability to refinance current maturities on a long-term basis under its revolving senior credit facilities, with the exception that $8 million of MGP’s quarterly amortization payments under its senior credit facility were classified as current because MGP used cash to make such amortization payments in January 2017.


Interest expense, net consisted of the following:

Year Ended December 31,

 

 Year Ended December 31,

2017

 

 

2016

 

 

2015

 

 202120202019

 

 

 

 

 

 

 

 

 

 

 

    

(In thousands)

 

 (In thousands)

Total interest incurred

$

779,855

 

 

$

814,731

 

 

$

862,377

 

Total interest incurred$800,156 $679,251 $853,007 

Interest capitalized

 

(111,110

)

 

 

(119,958

)

 

 

(64,798

)

Interest capitalized(563)(2,871)(5,075)

$

668,745

 

 

$

694,773

 

 

$

797,579

 

 $799,593 $676,380 $847,932 


Senior credit facility. At December 31, 2017, 2021, the Company’s senior credit facility consisted of a $238 million term loan A facility and a $1.25$1.675 billion revolving facility. The term loan A facility of which no amounts were drawn.

On February 14, 2020, in connection with the MGP BREIT Venture Transaction, the Company used proceeds from the transaction to repay and terminate the$1.5 billion outstanding on its then existing revolving facility bear interest determined by reference toin full and entered into an unsecured credit agreement, comprised of a total net leverage ratio pricing grid which results in an interest rate of LIBOR plus 1.75% to 2.75%. Both the term loan A$1.5 billion unsecured revolving facility and the revolving facility willthat would mature in April 2021. The term loan A facility is subject to amortization of principal in equal quarterly installments, with 5.0% of the initial aggregate principal amount of the term loan A facility to be payable each year. The Company permanently repaid $13 million of the term loan A facility for the year ended December 31, 2017 in accordance with the scheduled amortization. At December 31, 2017, $135 million was drawn on the revolving credit facility. At December 31, 2017, the interest rate on the term loan A facility was 3.82% and the interest rate on the revolving credit facility was 3.74%. For the year ended December 31, 2016,February 2025. As a result, the Company incurred a$4 million loss on early retirement of its prior credit facility of approximately $28 milliondebt recorded in “Other, net” in the consolidated statements of operations.



The senior

84

In April 2020 and then in February 2021, the Company amended its credit facility contains representationsto provide it with certain relief from the effects of the COVID-19 pandemic, including certain financial maintenance covenant waivers, agreeing to liquidity tests, and warranties, customary events of default, and positive, negative and financial covenants, including thatpledging the Operating Partnership units held by loan parties to the lenders as collateral. In November 2021, the Company maintain compliance withterminated its existing revolving facility and entered into a maximumnew $1.675 billion secured revolving credit facility that matures in November 2026. The revolving credit facility bears interest of SOFR plus 1.50% to 2.25% determined by reference to a rent adjusted total net leverage ratio a maximum first lien net leverage ratio and a minimum interest coverage ratio. pricing grid.

The Company was in compliance with itsCompany's senior revolving credit facility covenants at December 31, 2017.

is, subject to gaming approval, guaranteed by each of the Company's existing direct and indirect wholly-owned material domestic restricted subsidiaries, subject to certain exclusions. The senior revolving credit facility is secured by (i) a mortgage on the real properties comprising the MGM Grand Las Vegas and the Bellagio, (ii) a pledge of substantially all existing and future personal property of the subsidiaries of the Company that own the MGM Grand Las Vegas and the Bellagio; and (iii) a pledge of the equity or limited liability company interestsin certain of the entities that own MGM Grand Las Vegas and the Bellagio.

Company's domestic operating properties. Mandatory prepayments of the credit facilities will be required upon the occurrence of certain events, including sales of certain assets, casualty events and the incurrence of certain additional indebtedness, subject to certain exceptionsexceptions. The Company’s senior revolving credit facility also contains customary representations and reinvestment rights.

warranties, events of default and positive and negative covenants. The Company was in compliance with its applicable covenants at December 31, 2021.


Operating Partnership senior credit facility and bridge facility. At December 31, 2017,2021, the Operating Partnership’s senior secured credit facility consisted of a $274 million term loan A facility, a $1.82$1.35 billion term loan B facility, and a $600 million revolving credit facility. The revolving credit facility and term loan A facility bearbears interest of LIBOR plus 1.75% to 2.25% determined by reference to a total net leverage ratio pricing grid which resultsand will mature in an interest rate of LIBOR plus 2.25% to 2.75%. Prior to February 2017,June 2023. At December 31, 2021, $50 million was drawn on the term loan B facility bore interest at LIBOR plus 2.75% with a LIBOR floor of 0.75%. In February 2017, the Operating Partnership received a reduction of its term loan B interest rate to LIBOR plus 2.50%, with a LIBOR floor of 0.75% upon achieving a minimum corporate family rating of Ba3/BB-. On May 1, 2017, the Operating Partnership repriced its term loan B interest rate to LIBOR plus 2.25% with a LIBOR floor of 0%. All other principal provisions of the existing credit facility remain unchanged. The revolving credit facility and the term loan A facility will mature in April 2021 and the term loan B facility will mature in April 2023.

The term loan facilities are subject to amortization of principal in equal quarterly installments, with 5.0% of the initial aggregate principal amount of the term loan A facility and 1.0% of the initial aggregate principal amount of the term loan B facility to be payable each year. The Operating Partnership permanently repaid $19 million of the term loan A facility and $23 million of the term loan B facility for the year ended December 31, 2017, in accordance with the scheduled amortization. At December 31, 2017, the interest rate on the revolving credit facility was 1.85%.


In February 2020, in connection with the MGP BREIT Venture Transaction, the Operating Partnership amended its senior secured credit facility to, among other things, allow for the transaction to occur, permit the incurrence by the Operating Partnership of a nonrecourse guarantee relating to the debt of MGP BREIT Venture (refer to Note 12 for description of such guarantee), and permit the incurrence of the bridge loan facility. As a result of the transaction and the amendment, the Operating Partnership repaid its $1.3 billion outstanding term loan B facility in full with the proceeds of a bridge facility, which was then assumed by MGP BREIT Venture as partial consideration for the Operating Partnership’s contribution. Additionally, the Operating Partnership used the proceeds from the settlement of the forward equity issuances to pay off the outstanding balance of $399 million on its term loan A facility was 4.32% andin full. As a result, the Operating Partnership incurred an $18 million loss on early retirement of debt recorded in “Other, net” in the consolidated statements of operations.

The Operating Partnership is party to interest rate swaps to mitigate the effects of interest rate volatility inherent in its variable rate debt as well as forecasted debt issuances. As of December 31, 2021, the Operating Partnership has currently effective interest rate swap agreements on which it pays a weighted average fixed rate of 1.783% on total notional amount of $700 million. The Operating Partnership has an additional $900 million total notional amount of forward starting interest rate swaps that are not currently effective. The fair value of interest rate swaps designated as cash flow hedges was $25 million, with $5 million recorded as a current liability and $20 million recorded as a long-term liability as of December 31, 2021, and $41 million, with $1 million recorded as a current liability and $40 million recorded as a long-term liability, as of December 31, 2020. The fair value of interest rate swaps not designated as cash flow hedges was $27 million, with $8 million recorded as a current liability and $19 million recorded as a long-term liability as of December 31, 2021, and $78 million, with $31 million recorded as a current liability and $47 million recorded as a long-term liability, as of December 31, 2020. Interest rate swaps in a current liability position are recorded within “Other accrued expenses,” and those in a long-term liability position are recorded within “Other long-term obligations” on the term loan B facility was 3.82%. No amounts have been drawn on the revolving credit facility.

consolidated balance sheets.


The Operating Partnership credit facility contains customary representations and warranties, events of default and positive and negative and financial covenants, including that the Operating Partnership maintain compliance with a maximum senior secured net debt to adjusted total assets ratio, a maximum total net debt to adjusted assets ratio and a minimum interest coverage ratio. The Operating Partnership was in compliance with its credit facility covenants at December 31, 2017. 

2021.


The Operating Partnership senior credit facility is guaranteed by each of the Operating Partnership’s existing and subsequently acquired direct and indirect wholly owned material domestic restricted subsidiaries, except for MGM Springfield reDevelopment, which owns the real estate assets of MGM Springfield, and secured by a first priority lien security interest on substantially all of the Operating Partnership’s and such restricted subsidiaries’ material assets, including mortgages on its real estate, subject to customary exclusions, other than thatexcluding the real estate assets of MGM National Harbor.

The Operating Partnership is partyHarbor, Empire City, and MGM Springfield and subject to interest rate swaps to mitigate the interest rate risk inherent in its senior secured term loan B facility. As of December 31, 2017, the Operating Partnership pays a weighted average fixed rate of 1.844% on total notional amount of $1.2 billion and the variable rate received resets monthly to the one-month LIBOR with no minimum floor. Net unrealized gain on the interest rate swaps was $11 million as of December 31, 2017. As of December 31, 2016 the Operating Partnership had interest rate swaps with a notional amount of $500 million outstanding with a weighted average fixed rate of 1.825% and a net unrealized gain of $2 million.

other customary exclusions.


MGM China first revolving credit facility. At December 31, 2017,2021, the MGM China first revolving credit facility consisted of $1.47a $1.25 billion of term loans and a $1.45 billionunsecured revolving credit facility. The MGM China first revolving credit facility which bearbears interest at a fluctuating rate per annum based on HIBORHong Kong Interbank Offered Rate (“HIBOR”) plus a margin that ranges between 1.375% and 2.5% based on1.625% to 2.75%, as
85

determined by MGM China’s leverage ratio. The MGM China credit facility is scheduled toratio and will mature in April 2019 with the term loan facilities subject to amortization of principal in quarterly installments as a percentage of the original principal amount of 5% due in January 2018, 15% due in each of the subsequent quarters of 2018 and the first quarter of 2019, and the balance due at maturity in April 2019. The Company permanently repaid $77 million of term loans for the year ended December 31, 2017 in accordance with the scheduled amortization. The MGM China credit facility is secured by MGM Grand Paradise’s interest in the Cotai land use right, and MGM China, MGM Grand Paradise and their guarantor subsidiaries have granted a security interest in substantially all of their assets to secure the facility.May 2024. At December 31, 2017, $8322021, $360 million was drawn on the MGM China first revolving credit facility. At December 31, 2017, the weighted average interest rate on the term loans was 3.71%facility and the weighted average interest rate on the revolving credit facility was 3.57%2.95%.


The MGM China first revolving credit facility contains customary representations and warranties, events of default, and positive, negative and financial covenants, including that MGM China maintains compliance with a maximum leverage ratio and a minimum interest coverage ratio. In February 2017, the2021, MGM China amended its credit facility was amendedagreement to increase theprovide for a waiver of its maximum total leverage ratio to 6.00 to 1.00and its minimum interest coverage ratio through December 31, 2017, declining to 5.50 to 1.00 at March 31, 2018, 5.00 to 1.00 at June 30, 2018, 4.50 to 1.00 at September 30, 2018 and thereafter.the fourth quarter of 2022. MGM China was in compliance with its applicable MGM China credit facility covenants at December 31, 2017.

2021. In February 2022, MGM China is infurther amended its first revolving credit facility to extend the process of amending itsfinancial covenant waivers through maturity.

MGM China second revolving credit facility. The proposed amendedAt December 31, 2021,the MGM China second revolving credit facility extends the maturity date, extends the timingconsisted of and reducesa $400 million unsecured revolving credit facility with an option to increase the amount of scheduled amortization payments,the facility up to $500 million, subject to certain conditions. The MGM China second credit facility bears interest at a fluctuating rate per annum based on HIBOR plus 1.625% to 2.75%, as determined by MGM China’s leverage ratio and increaseswill mature in May 2024. Draws will be subject to satisfaction of certain conditions precedent, including evidence that the maximum leverage ratio.  

MGM National Harbor credit agreement. In October 2017, theChina first revolving credit facility has been fully drawn. At December 31, 2021, no amounts were drawn on the MGM China second revolving credit facility.


The MGM China second credit facility contains customary representations and warranties, events of default, and positive, negative and financial covenants, including that MGM China maintains compliance with a maximum leverage ratio and a minimum interest coverage ratio beginning in the third quarter of 2021. In February 2021, MGM China further amended its second credit facility agreement to provide for a waiver of its maximum leverage ratio and its minimum interest coverage ratio through the fourth quarter of 2022. MGM China was repaid and terminated byin compliance with its applicable MGM China second credit facility covenants at December 31, 2021. In February 2022, MGM China further amended its second revolving credit facility to extend the financial covenant waivers through maturity.

Senior Notes. In October 2020, the Company issued $750 million in aggregate principal amount of 4.75% senior notes due 2028.

In May 2020, the Company issued $750 million in aggregate principal amount of 6.75% senior notes due 2025.

In March 2020, the Company completed cash tender offers for an aggregate amount of $750 million of its senior notes, comprised of $325 million principal amount of its outstanding 5.75% senior notes due 2025, $100 million principal amount of its outstanding 4.625% senior notes due 2026, and the $425$325 million in principal amount of its outstanding term loans were assumed, and immediately repaid, by5.5% senior notes due 2027. As a subsidiary of MGP in conjunction withresult, the MGM National Harbor transaction. The Company incurred a $14$105 million loss on the early retirement of debt related to the MGM National Harbor credit facility recorded in “Other, net” in the consolidated statements of operations.

Senior Notes.


In July 2017,December 2019, the Company redeemedused a portion of the net proceeds from the Bellagio transaction to redeem for cash all $475$267 million principal amount of its outstanding 11.375%5.250% senior notes due 2018.2020, all $361 million principal amount of its outstanding 6.750% senior notes due 2020, and all $1.25 billion principal amount of its outstanding 6.625% senior notes due 2021. The Company incurred a $30$171 million loss on the early retirement of such notes recorded in “Other, net” in the consolidated statements of operations.


In August 2016,April 2019, the Company issued $500$1.0 billion in aggregate principal amount of 5.50% senior notes due 2027. The Company primarily used the net proceeds from the offering to fund the purchase of $639 million in aggregate principal amount of its outstanding 6.75% senior notes due 2020 and $233 million in aggregate principal amount of its outstanding 5.25% senior notes due 2020 through cash tender offers.

In February 2019, the Company repaid its $850 million 8.625% senior notes due 2019.

Operating Partnership senior notes. In November 2020, the Operating Partnership issued $750 million in aggregate principal amount of 3.875% senior notes due 2029.

In June 2020, the Operating Partnership issued $800 million in aggregate principal amount of 4.625% senior notes due 2026 for net proceeds of $493 million. The Company used the net proceeds, together with cash on hand, to redeem the $743 million outstanding aggregate principal amount of its 7.625% senior notes due 2017, in September 2016. The Company incurred a loss on early retirement of the 7.625% senior notes of approximately $16 million recorded in “Other, net” in the consolidated statements of operations.

2025.


In connection with the closing of MGP’s IPO, on May 25, 2016 (the “Redemption Date”) the Company redeemed for cash all $1.23 billion aggregate principal amount of its outstanding 7.5% senior notes due 2016 and 10% senior notes due 2016 in accordance with the terms of the applicable indenture. The Company incurred a loss on early retirement of such notes of approximately $22 million recorded in “Other, net” in the consolidated statements of operations.

Operating Partnership senior notes. In September 2017,January 2019, the Operating Partnership issued $350$750 million in aggregate principal amount of 4.50%5.75% senior notes due 2028 for net proceeds of $346 million.

In August 2016, the Operating Partnership issued $500 million in aggregate principal amount of 4.5% senior notes due 2026 for net proceeds of $492 million.

In April 2016, a subsidiary of the Operating Partnership issued $1.05 billion in aggregate principal amount of 5.625% senior notes due 2024 and on MGP’s IPO date, the Operating Partnership entered into a supplemental indenture through which it assumed the obligations under the notes from such subsidiary (which merged into the Operating Partnership on such date).

2027.


86

Each series of the Operating Partnership's senior notes are fully and unconditionally guaranteed, jointly and severally, on a senior basis by all of the Operating Partnership’s subsidiaries that guarantee the Operating Partnership’s credit facilities, other than MGP Finance Co-Issuer, Inc., which is a co-issuer of the senior notes. The Operating Partnership may redeem all or part of the senior notes at a redemption price equal to 100% of the principal amount of the senior notes plus, to the extent the Operating Partnership is redeeming senior notes prior to the date that is three months prior to their maturity date, an applicable make whole premium, plus, in each case, accrued and unpaid interest. The indentures governing the senior notes contain customary covenants and events of default. These covenants are subject to a number of important exceptions and qualifications set forth in the applicable indentures governing the senior notes, including, with respect to the restricted payments covenants, the ability to make unlimited restricted payments to maintain the REIT status of MGP.

Bridge Facilities.


MGM China senior notes. In March 2021, MGM China issued $750 million in aggregate principal amount of 4.75% senior notes due 2027 at an issue price of 99.97%.

In June 2020, MGM China issued $500 million in aggregate principal amount of 5.25% senior notes due 2025.

In May 2019, MGM China issued $750 million in aggregate principal amount of 5.375% senior notes due 2024 and $750 million in aggregate principal amount of 5.875% senior notes due 2026. The Company primarily used the net proceeds from the offering to pay down outstanding borrowings under the MGM China first revolving credit facility. MGM China incurred a $16 million loss on the debt retirement recorded in “Other, net” in the consolidated statements of operations.

CityCenter senior credit facility. In connection with the Borgata transaction in August 2016,CityCenter acquisition, the Company borrowed $545 million under certain bridge facilities, the proceedsassumed $1.7 billion of CityCenter's indebtedness, which were used to repay existing Borgata debt. The bridge facilities were subsequently contributed to the Operating Partnership. The Operating Partnership immediatelywas repaid the bridge facilitiesand extinguished in September 2021 with a combination of cash on hand and a draw down on its revolving credit facility, which it subsequently refinanced with proceeds from its offering of its 4.5% senior notes due 2026.

hand.


In connection with the master contribution agreement and related transactions in April 2016, the Company borrowed $4.0 billion under certain bridge facilities, the proceeds of which were used to repay its outstanding obligations under its prior senior credit facility and were used to repay its 7.5% senior notes due 2016 and its 10% senior notes due 2016 on the Redemption Date. The bridge facilities were subsequently assumed by the Operating Partnership pursuant to the master contribution agreement. The Operating Partnership repaid the bridge facilities with a combination of proceeds from financing its transactions and the proceeds from the IPO.

Maturities of long-term debt. The maturities of the principal amount of the Company’s long-term debt as of December 31, 20172021 are as follows:

Years ending December 31,

 

 

 

(In thousands)

 

2018

 

 

 

$

819,572

 

2019

 

 

 

 

2,424,013

 

2020

 

 

 

 

1,546,000

 

2021

 

 

 

 

1,832,250

 

2022

 

 

 

 

1,018,500

 

Thereafter

 

 

 

 

5,377,941

 

 

 

 

 

$

13,018,276

 

 

 

 

 

 

 

 


Years ending December 31,(In thousands)
2022$1,000,000 
20231,300,000 
20242,160,414 
20252,725,000 
20261,650,000 
Thereafter4,025,552 
 $12,860,966 

Fair value of long-term debt. The estimated fair value of the Company’s long-term debt was $13.6$13.4 billion and $13.9$13.2 billion at December 31, 20172021 and 2016,2020, respectively. Fair value was estimated using quoted market prices for the Company’s senior notes and senior credit facilities.


NOTE 1110 — INCOME TAXES


The Company recognizes deferred income tax assets, net of applicable reserves, related to net operating losses, tax credit carryforwards and certain temporary differences. The Company recognizes future tax benefits to the extent that realization of such benefit is more likely than not. Otherwise, a valuation allowance is applied.


Income (loss) before income taxes for domestic and foreign operations consisted of the following:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In thousands)

 

Domestic operations

 

$

750,055

 

 

$

985,683

 

 

$

155,296

 

Foreign operations

 

 

213,700

 

 

 

273,494

 

 

 

(1,201,539

)

 

 

$

963,755

 

 

$

1,259,177

 

 

$

(1,046,243

)



 Year Ended December 31,
 202120202019
 (In thousands)
Domestic operations$2,094,324 $(665,376)$2,717,756 
Foreign operations(632,520)(846,103)128,969 
 $1,461,804 $(1,511,479)$2,846,725 


87

The benefit (provision) for income taxes attributable to income (loss) before income taxes is as follows:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

Federal:

 

(In thousands)

 

Current

 

$

(120,980

)

 

$

(97,502

)

 

$

(13,540

)

Deferred (excluding separate components)

 

 

203,674

 

 

 

(125,181

)

 

 

280,220

 

Deferred – change in enacted rates

 

 

994,249

 

 

 

—

 

 

 

—

 

Deferred – valuation allowance

 

 

101,443

 

 

 

222,688

 

 

 

(247,867

)

Other noncurrent

 

 

1,356

 

 

 

3,608

 

 

 

(590

)

Benefit for federal income taxes

 

 

1,179,742

 

 

 

3,613

 

 

 

18,223

 

State:

 

 

 

 

 

 

 

 

 

 

 

 

Current

 

 

(6,798

)

 

 

4,069

 

 

 

(1,840

)

Deferred (excluding separate components)

 

 

(25,233

)

 

 

2,313

 

 

 

(2,768

)

Deferred – operating loss carryforward

 

 

44,242

 

 

 

(16,024

)

 

 

(2,263

)

Deferred – valuation allowance

 

 

(40,078

)

 

 

23,058

 

 

 

(4,465

)

Other noncurrent

 

 

(3,875

)

 

 

(2,901

)

 

 

7,153

 

Benefit (provision) for state income taxes

 

 

(31,742

)

 

 

10,515

 

 

 

(4,183

)

Foreign:

 

 

 

 

 

 

 

 

 

 

 

 

Current

 

 

(470

)

 

 

(2,015

)

 

 

(2,127

)

Deferred (excluding separate components)

 

 

(40,653

)

 

 

(34,425

)

 

 

(5,832

)

Deferred – operating loss carryforward

 

 

4,688

 

 

 

2,988

 

 

 

10,472

 

Deferred – valuation allowance

 

 

21,098

 

 

 

(2,975

)

 

 

(9,959

)

Provision for foreign income taxes

 

 

(15,337

)

 

 

(36,427

)

 

 

(7,446

)

 

 

$

1,132,663

 

 

$

(22,299

)

 

$

6,594

 


 Year Ended December 31,
 202120202019
Federal:(In thousands)
Current$(8,984)$207,544 $(4,928)
Deferred (excluding separate components)(189,657)19,852 (537,993)
Deferred – valuation allowance
(14,967)(42,109)(20,175)
Other noncurrent(14,262)4,922 (5,745)
Benefit (provision) for federal income taxes(227,870)190,209 (568,841)
State:
Current5 (816)(22,685)
Deferred (excluding separate components)(28,068)(33,087)(32,793)
Deferred – operating loss carryforward
(27,936)47,728 (5,241)
Deferred – valuation allowance
(601)(3,375)(191)
Other noncurrent13,260 (946)(1,401)
Benefit (provision) for state income taxes(43,340)9,504 (62,311)
Foreign:
Current(3,717)(828)(2,454)
Deferred (excluding separate components)8,943 4,206 44,374 
Deferred – operating loss carryforward
5,793 39,920 32,915 
Deferred – valuation allowance
6,776 (51,439)(76,028)
Benefit (provision) for foreign income taxes17,795 (8,141)(1,193)
 $(253,415)$191,572 $(632,345)

A reconciliation of the federal income tax statutory rate and the Company’s effective tax rate is as follows:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal income tax statutory rate

 

 

35.0

%

 

 

35.0

%

 

 

35.0

%

Change in enacted rates

 

 

(103.1

)

 

 

—

 

 

 

—

 

Foreign tax credit

 

 

(70.1

)

 

 

(10.5

)

 

 

63.7

 

Repatriation of foreign earnings

 

 

35.3

 

 

 

5.2

 

 

 

(32.0

)

Foreign goodwill impairment

 

 

—

 

 

 

—

 

 

 

(49.1

)

Federal valuation allowance

 

 

(10.5

)

 

 

(17.7

)

 

 

(23.7

)

State taxes, net

 

 

2.4

 

 

 

—

 

 

 

—

 

Stock-based compensation

 

 

(2.1

)

 

 

—

 

 

 

—

 

Gain on Borgata transaction

 

 

—

 

 

 

(5.4

)

 

 

—

 

Foreign jurisdiction income/losses taxed at other than 35%

 

 

(4.9

)

 

 

(3.8

)

 

 

6.9

 

Permanent and other items

 

 

0.5

 

 

 

(1.0

)

 

 

(0.2

)

 

 

 

(117.5

)%

 

 

1.8

%

 

 

0.6

%



 Year Ended December 31,
 202120202019
Federal income tax statutory rate21.0 %21.0 %21.0 %
Net operating loss carryback rate differential— 5.5 — 
Noncontrolling interest(3.2)1.6 (0.8)
Foreign jurisdiction income/losses taxed at other than U.S. statutory rate8.2 (12.5)(0.5)
Federal valuation allowance1.0 (2.8)0.7 
State taxes, net2.3 0.5 1.7 
Gain on consolidation of CityCenter, net(10.1)— — 
Permanent and other items(1.9)(0.6)0.1 
 17.3 %12.7 %22.2 %

88


The major tax-effected components of the Company’s net deferred tax liability are as follows:

 

December 31,

 

 December 31,

 

2017

 

 

2016

 

 20212020

Deferred tax assets – federal and state:

 

(In thousands)

 

Deferred tax assets – federal and state:(In thousands)

Bad debt reserve

 

$

25,432

 

 

$

40,330

 

Deferred compensation

 

 

5,232

 

 

 

6,881

 

Net operating loss carryforward

 

 

46,702

 

 

 

9,669

 

Net operating loss carryforward$35,350 $57,419 

Accruals, reserves and other

 

 

85,626

 

 

 

168,712

 

Accruals, reserves and other39,163 167,553 

Investments in unconsolidated affiliates

 

 

84,006

 

 

 

152,092

 

Stock-based compensation

 

 

24,390

 

 

 

33,311

 

Lease liabilitiesLease liabilities2,714,308 1,972,343 

Tax credits

 

 

3,045,138

 

 

 

2,824,312

 

Tax credits3,060,733 3,095,856 

 

 

3,316,526

 

 

 

3,235,307

 

 5,849,554 5,293,171 

Less: Valuation allowance

 

 

(2,462,272

)

 

 

(2,510,140

)

Less: Valuation allowance(2,735,451)(2,720,008)

 

 

854,254

 

 

 

725,167

 

 3,114,103 2,573,163 

Deferred tax assets – foreign:

 

 

 

 

 

 

 

 

Deferred tax assets – foreign:

Bad debt reserve

 

 

821

 

 

 

895

 

Net operating loss carryforward

 

 

76,909

 

 

 

72,788

 

Net operating loss carryforward185,936 180,143 

Accruals, reserves and other

 

 

—

 

 

 

3,945

 

Accruals, reserves and other15,228 17,083 

Stock-based compensation

 

 

4,423

 

 

 

3,830

 

Property and equipmentProperty and equipment27,366 17,890 
Lease liabilitiesLease liabilities1,458 1,368 

 

 

82,153

 

 

 

81,458

 

 229,988 216,484 

Less: Valuation allowance

 

 

(51,466

)

 

 

(73,134

)

Less: Valuation allowance(148,811)(155,587)

 

 

30,687

 

 

 

8,324

 

 81,177 60,897 

Total deferred tax assets

 

$

884,941

 

 

$

733,491

 

Total deferred tax assets$3,195,280 $2,634,060 

Deferred tax liabilities – federal and state:

 

 

 

 

 

 

 

 

Deferred tax liabilities – federal and state:

Property and equipment

 

$

(1,670,704

)

 

$

(2,657,230

)

Property and equipment$(1,361,356)$(1,349,355)

Long-term debt

 

 

(48,809

)

 

 

(146,018

)

Investments in unconsolidated affiliatesInvestments in unconsolidated affiliates(1,252,816)(1,158,342)
ROU assetsROU assets(2,570,620)(1,860,195)

Intangibles

 

 

(79,167

)

 

 

(124,729

)

Intangibles(141,934)(108,728)

 

 

(1,798,680

)

 

 

(2,927,977

)

 (5,326,726)(4,476,620)

Deferred tax liabilities – foreign:

 

 

 

 

 

 

 

 

Deferred tax liabilities – foreign:

Accruals, reserves and other

 

 

(26,657

)

 

 

—

 

Property and equipment

 

 

(16,277

)

 

 

(4,691

)

Intangibles

 

 

(348,162

)

 

 

(352,051

)

Intangibles(307,522)(309,256)
ROU AssetsROU Assets(396)(1,200)

 

 

(391,096

)

 

 

(356,742

)

 (307,918)(310,456)

Total deferred tax liability

 

$

(2,189,776

)

 

$

(3,284,719

)

Total deferred tax liability$(5,634,644)$(4,787,076)

Net deferred tax liability

 

$

(1,304,835

)

 

$

(2,551,228

)

Net deferred tax liability$(2,439,364)$(2,153,016)

On December 22, 2017,


In March 2020, the U.S. government enacted comprehensive tax legislation commonly referred to as the U.S. Tax CutsCoronavirus Aid, Relief, and JobsEconomic Security Act (the “Tax“CARES Act”). was signed into law. The TaxCARES Act makes broad and complex changescontains certain income tax provisions that are beneficial to the U.S.Company; namely, the relaxation of the interest expense deduction limitation for the 2019 and 2020 tax code that will generally be applicableyears and the allowance of a 5-year carryback of net operating losses (“NOLs”) incurred during tax years 2018 through 2020. The Company has recorded a federal income tax receivable of $226 million to reflect the carryback of its 2020 NOL. Furthermore, since the NOL was carried back to tax years beginning after December 31, 2017, including, but not limited to, (1) reducingwhen the U.S. federal corporateincome tax rate from 35 percentwas 35%, compared to 21 percent; (2) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries; (3) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; (4) adding a new provision designed to tax global intangible low-taxed income (GILTI), which allows for the possibility of using foreign tax credits (FTCs) and a deduction of up to 50 percent to offset21% rate currently in effect, the Company realized $90 million more income tax liability (subject to some limitations); (5) creating a new limitation on deductible interest expense; (6) imposing additional limitations on the deductibility of executive compensation and certain employee fringe benefits; and (7) increasing bonus depreciation to allow for full expensing of qualified property.

The SEC staff issued Staff Accounting Bulletin No. 118 (SAB 118), which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effects of the Tax Act is incomplete butbenefit than if it iswould have only been able to determine a reasonable estimate, it must record a provisional estimate incarry the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act.  

NOL forward.


In connection with its initial analysis of the impact of the Tax Act, the Company’s accounting for certain elements of the Tax Act is incomplete. However, the

The Company was able to make reasonable estimates of certain effects and, therefore,has recorded a provisional discrete non-cash net tax benefitvaluation allowance of $1.4$2.7 billion in the period ended December 31, 2017, consisting of a benefit of $994 million for the corporate rate reduction and a benefit of $438 million from its provisional re-assessment of the Tax Act’s impact on the valuation allowance on its foreign tax credit (“FTC”) carryovers. The Company did not provide tax expense for the transition tax on its unrepatriated earnings, which totaled $669 million without regard to actual 2017 distributions of $62 million, because such earnings are fully offset by FTCs. Furthermore, the Company has made an accounting policy decision to treat taxes due, if any, on future inclusions in U.S. taxable income under the GILTI provisions as a current period expense when incurred. Accordingly, the Company has not provided a deferred tax liability for any GILTI taxes that may result in future periods.

The Company’s accounting for the impact of the Tax Act is incomplete. The Company was able to make a reasonable estimate of the impact on the valuation allowance against its FTC carryovers and provided the provisional adjustment described above. This amount may be adjusted during the measurement period as the Company gathers additional information and evaluates any future regulatory or other guidance on items that may impact the valuation allowance, including, but not limited to, the computations of foreign derived intangible income and allocations of interest and other expenses to active foreign source income. In addition, the Company was not able to make reasonable estimates and provided no provisional amounts for the potential impact, if any, of indirect costs of providing certain employee fringe benefits that may be subject to limitation under the Tax Act.  

The Company has recorded a provisional valuation allowance of $2.4 billion on its FTC carryover of $3.0$3.1 billion as of December 31, 2017 based upon its initial assessment of future realization under the Tax Act,2021, resulting in an FTC net deferred tax asset of $618$332 million. The FTCs are attributable to the Macau Special Gaming Tax, which is 35% of gross gaming revenue in Macau. Because MGM Grand Paradise is presently exempt from the Macau 12% complementary tax on gaming profits, the Company believes that payment of the Macau Special Gaming Tax qualifies as a tax paid in lieu of an income tax that is creditable against U.S. taxes. While the Company generally does not expect to generate new FTC carryovers underafter the Tax Act,year ended December 31, 2017, it will be able to utilize its existing FTC carryovers to the extent that it has active foreign source income during the 10-year FTC carryforward period. Such foreign source income includes the recapture, to the extent of 50% of U.S. taxable income each year, of overall domestic losses that totaled $2.3$1.3 billion at December 31, 2017.2021. The Company relies on future U.S. source

89

operating income in assessing utilization of the overall domestic losses and, by extension, future FTC realization during the 10-year FTC carryover period. The FTC carryovers will expire if not utilized as follows: $752$297 million in 2022; $976 million in 2023; $787$780 million in 2024; $331$674 million in 2025; and $199$134 million in 2026; and $200 million in 2027.


The Company’s assessment of the realization of its FTC deferred tax asset is based on available evidence, including assumptions concerning future U.S. operating profits and its initial interpretations of the Tax Act in the absence of regulatory or other clarifying guidance.foreign source income. As a result, significant judgment is required in assessing the possible need for a valuation allowance and changes to such assumptions could result in a material change in the valuation allowance with a corresponding impact on the provision for income taxes in the period including such change.

Income generated from gaming operations of MGM Grand Paradise, which is owned by MGM China, is exempted from Macau’s 12% complementary tax, pursuant to approval from the Macau government. Absent this exemption, “Net income attributable to MGM Resorts International” would have decreased by $23 million and $25 million in 2017 and 2016, respectively, and diluted earnings per share would have decreased by $0.04 in each year.


On September 7, 2016,March 30, 2020, MGM Grand Paradise was granted an additional extension of its exemption from the Macau 12% complementary tax exemptionon gaming profits through March 31, 2020,June 26, 2022, concurrent with the end of the term of its current gaming subconcession. A competitor ofAbsent the exemption from complementary tax on gaming profits, “Net income attributable to MGM Grand Paradise subsequently received an additional extension of its exemption through March 31,Resorts International” would have decreased by $10 million in 2021 and increased by $4 million in 2020 which also runs concurrent with the end of the term of its current gaming concession. Based upon these developments and the uncertainty concerning taxation after the concession renewal process, thediluted earnings per share would have decreased by $0.02 in 2021 and increased by $0.01in 2020. The Company has assumedcontinues to assume that MGM Grand Paradise will pay the Macau 12% complementary tax on gaming profits for all periods beyond March 31, 2020June 26, 2022 and has factored that assumption into the measurement of Macau deferred tax assets and liabilities.


Non-gaming operations remain subject to the Macau complementary tax. At December 31, 2021, MGM Grand Paradise had at December 31, 2017 a complementary tax net operating lossNOL carryforward of $625 million$1.5 billion resulting from non-gaming operations that will expire if not utilized against non-gaming income in years 20182022 through 2020.

2024.


MGM Grand Paradise’s exemption from the Macau 12% complementary tax on gaming profits does not apply to dividend distributions of such profits to MGM China. However,On July 26, 2021, MGM Grand Paradise has had anextended its agreement with the Macau government to settle the 12% complementary tax that would otherwise be due by its shareholder, MGM China, on distributions of its gaming profits by paying a flat annual payment (“annual fee arrangement”) regardless of the amount of distributable dividends. Such annual fee arrangement was effective forThe extension covers distributions of profits earned through December 31, 2016. MGM China was not subject to the complementary tax on distributions covered by the annual fee arrangement, which required annual payments of $2 million through


2016. Since the earnings for 2017 were not covered by an annual fee arrangement as of December 31, 2017, the Company provided deferred taxes on such earnings, which total $41 million as of December 31, 2017. Subsequent to year-end, on February 27, 2018, MGM Grand Paradise was notified of the terms of an extension of the annual fee arrangement, which covers the distributions ofgaming profits earned for the period of JanuaryApril 1, 20172020 through March 31, 2020. It will require annualJune 26, 2022. The agreement requires payments of approximately $1 million for 2017the period April 1, 2020 through 2019December 31, 2020, $2 million for January 1, 2021 through December 31, 2021, and a payment of approximately $300,000$1 million for the first quarter 2020. Whenperiod January 1, 2022 through June 26, 2022. The Company recorded $3 million of income tax expense during the extension is executed,year ended December 31, 2021 under the Company will reverse the deferred taxes previously recorded on 2017 earnings, which is anticipated to be within the first quarter 2018, resulting in a reduction in provision for income taxes in such period that will be partially offset by the 2017 annual payment amount.

extension.


The Company has net operating lossesNOLs in certain of the states in which it operates that total $708$536 million as of December 31, 2017,2021, which equates to deferred tax assets of $47$35 million after federal tax effect and before valuation allowance. These net operating lossThe majority of these NOL carryforwards will expire if not utilized by 20212025 through 2037.2040 with the remaining being carried forward indefinitely. The Company has provided a valuation allowance of $36$6 million on certain of its state deferred tax assets, including the net operating lossesa portion of NOLs described above.


In addition, there is a valuation allowance of $49$146 million on certain Macau deferred tax assets, and a valuation allowance of $2$3 million on Hong Kong net operating lossesNOLs because the Company believes these assets do not meet the “more likely than not” criteria for recognition.


A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits is as follows:

 

Year Ended December 31,

 

 Year Ended December 31,

 

2017

 

 

2016

 

 

2015

 

 2021 2020 2019

 

(In thousands)

 

 (In thousands)

Gross unrecognized tax benefits at January 1

 

$

14,026

 

 

$

13,724

 

 

$

31,143

 

Gross unrecognized tax benefits at January 1$35,617 $33,298 $24,464 
Gross increases - prior period tax positionsGross increases - prior period tax positions12,949 3,717 8,960 

Gross decreases - prior period tax positions

 

 

(2,280

)

 

 

(3,375

)

 

 

(14,158

)

Gross decreases - prior period tax positions(13,388)(1,398)(1,006)

Gross increases - current period tax positions

 

 

6,842

 

 

 

3,677

 

 

 

1,222

 

Gross increases - current period tax positions654 — 880 

Settlements with taxing authorities

 

 

—

 

 

 

—

 

 

 

(2,408

)

Lapse in Statutes of Limitations

 

 

—

 

 

 

—

 

 

 

(2,075

)

Settlements with Taxing Authorities Settlements with Taxing Authorities(16,264)— — 

Gross unrecognized tax benefits at December 31

 

$

18,588

 

 

$

14,026

 

 

$

13,724

 

Gross unrecognized tax benefits at December 31$19,568 $35,617 $33,298 


The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was $11 million and $9 million at December 31, 20172021 and 2016,2020, respectively.


The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense, which were not material asfor each of December 31, 2017, 2016 or 2015. The Company does not anticipate that the total amounts of unrecognized tax benefits at December 31, 2017 will change materially within the next twelve months.

periods presented.


90

The Company files income tax returns in the U.S. federal jurisdiction, various state and local jurisdictions, and foreign jurisdictions, although the income taxes paid in foreign jurisdictions are not material. As of December 31, 2017,2021, the IRS can generally no longer assess tax with respect to years ended prior to 2014; however2016. During the twelve months ended December 31, 2021, the Company reached a settlement with the IRS may adjust NOLs generated in such years that were utilized in 2014. The Company’sAppeals Office on the examination of its 2014 U.S. consolidated federal income tax return and the 2014 U.S. incomereturn. No cash tax return of CityCenter Holdings, LLC, an unconsolidated affiliate treatedpayments were due as a partnership for income tax purposes are currently under examination by the IRS. During 2015, the Company received final approval from the Joint Committee on Taxationresult of the results of the IRS examination of the 2009 tax year and agreed to all IRS adjustments to the 2010 and 2011 tax years of CityCenter Holdings, LLC. The Company received a refund of $16 million of taxes and associated interest in connection with the settlement of these examinations, which are considered settled for financial accounting purposes.

settlement.


As of December 31, 2017,2021, other than adjustments resulting from the federal and state income tax audits discussed above,herein, the various state and local tax jurisdictions in which the Company files tax returns can no longer assess tax with respect to years ended prior to 2013.2016. However, such state and local tax jurisdictions may adjust NOLs generated in such years that are utilized in subsequent years. SubsequentDuring 2021, an examination of income tax returns filed in New Jersey for tax years 2015 through 2018 closed with no change and an examination of income tax returns filed in Massachusetts for tax years 2017 and 2018 closed with no material adjustments. Additionally, the Company's income tax returns filed in New York City for the tax years 2017 through 2019 are currently under examination. The Company does not anticipate any material adjustments upon resolution of this audit.

The Company received a final audit determination with respect to year-end,the examination of income tax returns filed in the state of Mississippi informedMichigan for tax years 2014 through 2018. The Company had an informal conference with the Michigan Department of Treasury Hearings Division to contest the findings of the audit. The Hearings Division issued its decision and order and now the Company is determining its next course of action. Any final adjustments upon resolution of this matter are not expected to be material.

The Company believes that it would be opening an auditis reasonably possible that the total amounts of unrecognized tax benefits at December 31, 2021 may decrease by up to $13 million within the 2014 through 2016 Mississippinext twelve months on the expectation of resolution of a tax returns filed by the Company. During 2015, the state of New Jersey completedaccounting method related to its examination of Marina District Development Holding Company, LLC for the 2003 through 2009 tax years. All adjustments were agreed to by the members of Marina District Development Holding Company, LLC and the examination is now considered settled for financial accounting purposes. The Company made a $1 million payment of tax and associated interest as a result of this settlement. No other state or local income tax returns are currently under examination.

customer loyalty program.


NOTE 1211 – COMMITMENTS AND CONTINGENCIES

Leases.LEASES


The Company leases the land underlying certain of its properties, real estate, and various equipment under operating and, to a lesser extent, capitalfinance lease arrangements. Certain real estate leases provide for escalation of rent based upon a specified price index and/or based upon periodic appraisals.

At December 31, 2017, the Company was obligated under non-cancellable operating leases to make future minimum lease payments as follows:

Years ending December 31,

 

(In thousands)

 

2018

 

$

39,429

 

2019

 

 

35,525

 

2020

 

 

33,754

 

2021

 

 

35,293

 

2022

 

 

32,458

 

Thereafter

 

 

1,360,206

 

Total minimum lease payments

 

$

1,536,665

 

The table above excludes the Company’s future lease obligations to a subsidiary of the Operating Partnership pursuant to theMGP master lease, agreementwhich is further discussed in Note 18, as these lease obligations are eliminatedeliminates in consolidation. Rental expense for operating leases was $92 million, $80 millionconsolidation and, $74 million for 2017, 2016accordingly, is not included within the disclosures below.


Land. The Company, through MGP, is a lessee of land underlying MGM National Harbor and 2015, respectively, which included short-term rentals charged to rent expense as well as $7 million in each of 2017, 2016, 2015 related to the amortizationa portion of the Cotai land concession. The Company accountsunderlying Borgata and Beau Rivage. MGP is obligated to make lease payments through the non-cancelable term of the ground leases, which is through 2051 for theBeau Rivage, through 2070 for Borgata, and through 2082 for MGM National Harbor. Additionally, MGM Grand Paradise has MGM Macau and MGM Cotai land concession contract ascontracts, each with an operating lease for which the required upfront payments are amortized over the initial 25-year contract term. Amortization relating to the Cotaiterm ending in April 2031 and January 2038, respectively. The land concession is included in “Preopening and start-up expenses” prior to its opening.

In August 2016, in connection with the Borgata transaction, the Company has assumed the liability of a series of ground leases for a total of approximately 11 acres of land on which the Borgata employee parking garage, public space expansion, rooms expansion, and modified surface parking lot reside. are classified as operating leases.


Real Estate Assets. The Company recorded an unfavorableleases the real estate assets of Bellagio, Mandalay Bay and MGM Grand Las Vegas, and Aria (including Vdara) pursuant to triple-net lease liability for the excess contractual lease obligations over the market valueagreements, which are classified as operating leases. Each of the leases obligates the Company to spend a specified percentage of net revenues at the properties on capital expenditures and that the Company comply with certain financial covenants, which, will be amortized on a straight-line basis overif not met, would require the termCompany to maintain cash security or provide one or more letters of credit in favor of the landlord in an amount equal to 1 year of rent under the Mandalay Bay and MGM Grand lease contracts through December 2070.and Aria lease and 2 years of rent under the Bellagio lease. The remaining balance of the unfavorable lease liabilityCompany was $47 million and $48 millionin compliance with its applicable covenants as of December 31, 2017 and 2016, respectively.2021.

Bellagio lease. The ground lease is accounted for as an operating lease with rental expenseCompany leases the real estate assets of $6 million and $2 million for the years ending December 31, 2017 and December 31, 2016, respectively.

In April 2013, the Company entered into a ground lease agreement for an approximate 23 acre parcel of land in connection with the MGM National Harbor project.Bellagio from Bellagio BREIT Venture. The groundBellagio lease has an initial term of 2530 years with 2 10-year renewal periods, exercisable at the Company’s option, with a fixed 2% rent escalator for the first 10 years and, thereafter, an escalator equal to the rightgreater of 2% and the CPI increase during the prior year, subject to extenda cap of 3% during the 11th through 20th years and 4% thereafter. Annual cash rent payments for upthe third lease year that commenced on December 1, 2021 increased to 13 additional six year$255 million as a result of the second 2% fixed annual escalator.


Mandalay Bay and MGM Grand Las Vegas lease. The Company leases the real estate assets of Mandalay Bay and MGM Grand Las Vegas from MGP BREIT Venture. The Mandalay Bay and MGM Grand Las Vegas lease has an initial term of 30 years with 2 10-year renewal periods, exercisable at the Company’s option, with a fixed 2% rent escalator for the first 715 years and, thereafter, an escalator equal to the greater of those additional periods considered2% and the CPI increase during the prior year, subject to be reasonably assured.a cap of 3%. Annual cash rent payments for the second lease year that commenced on March 1, 2021 increased to $298 million as a result of the first 2% fixed annual escalator.

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Aria lease. The Company therefore amortizesleases the real estate assets of Aria (including Vdara) from funds managed by Blackstone. The Aria lease onhas an initial term of 30 years with 3 10-year renewal periods, exercisable at the Company's option, with a straight line basis over a 67 year term. The ground lease is accounted for as an operating lease with rental expense of $16 million, $16 million and $19 million recorded fixed 2% rent escalator for the first 15 years, ending December 31, 2017, 2016 and 2015, respectively. Rent recognizedthereafter, an escalator equal to the greater of 2% and the CPI increase during the prior year, subject to a cap of 3%. Annual cash rent payments for the groundfirst lease year that commenced on September 28, 2021 was recorded in "Preopening$215 million.

Other information. Components of lease costs and start-up expenses" prior to its opening in December 2016.

Borgata property tax reimbursement agreement. On February 15, 2017, Borgata, the Department of Community Affairs of the State of New Jersey and Atlantic City entered into an agreement wherein Borgata was to be reimbursed $72 million as settlement for property tax refunds in satisfaction of New Jersey Tax Court and Superior Court judgments totaling approximately $106 million, plus interest for the 2009-2012 tax years and the settlement of pending tax appeals for the tax years 2013-2015. Those pending tax appeals could potentially have resulted in Borgata being awarded additional refunds due of approximately $65 million. In June 2017, Atlantic City and the State of New Jersey issued bonds and used the proceeds to pay the $72 million settlement in full. The Company recorded the amounts received pursuant to the reimbursement agreement as an offset to general and administrative expenses in the consolidated statements of operations. As required by the purchase and sale agreement to acquire Borgata in August 2016, the Company paid Boyd Gaming half of the settlement amount received by the Company, net of fees and expenses. Amounts paid to Boyd Gaming were recorded in general and administrative expenses in the consolidated statements of operations.

NV Energy. In July 2016, the Company filed its notice to exit the fully bundled sales system of NV Energy and now purchases energy, capacity, and/or ancillary services from a provider other than NV Energy. The Company paid an upfront impact payment of $83 million, including $14 million related to CityCenter, in September 2016. Under the terms of the exit agreement, the Company and CityCenter were required to make ongoing payments to NV Energy for non-bypassable rate charges, which primarily relate to each entity’s share of NV Energy’s portfolio of renewable energy contracts which extended through 2040 and each entity’s share of the costs of decommissioning and remediation of coal-fired power plants in Nevada. The Company’s initial estimate of its obligation


related to non-bypassable charges was $71 million. The expense recognizedinformation related to the upfront paymentCompany’s leases was:

 Year Ended December 31,
 2021 20202019
 (In thousands)
Operating lease cost, primarily classified within "General and administrative"(1)
$870,779 $751,002 $143,954 
 
Finance lease costs
Interest expense(2)
$2,354 $(21,320)$1,164 
Amortization expense73,475 70,476 13,341 
Total finance lease costs$75,829 $49,156 $14,505 

(1)The Bellagio lease and the initial accrualMandalay Bay and MGM Grand Las Vegas lease are held with related parties, as further discussed in Note 18. Operating lease cost includes $331 million for each of the liability associated with the non-bypassable charges was recorded within “NV Energy exit expense” in the Company’s consolidated statements of operationsyears ended December 31, 2021 and 2020, and $42 million for the year ended December 31, 2016. Subsequent accretion2019, related to the Bellagio lease. Operating lease cost includes $395 million, $347 million, and $0 for the years ended December 31, 2021, 2020, and December 31, 2019, respectively, related to the Mandalay Bay and MGM Grand Las Vegas lease.
(2)For the years ended December 31, 2021 and 2020, interest expense includes the effect of the liability and changes in estimates areCOVID-19 related rent concessions, which was recognized within general and administrative expenses in the consolidated statement of operations. In the second quarter of 2017, the terms of the ongoing impact fee obligations were modified. Such modifications included a credit to be applied against future non-bypassable rate charges and substantially shortened the period over which the Company and CityCenter are responsible for such charges, with an end date in 2022. As such, the Company recognized a reduction in its liability for future charges of $41 million with a corresponding credit to “NV Energy exit expense”. Additionally, CityCenter recorded an $8 million reduction in liability and credit toas negative variable rent expense.


 December 31,
 20212020
Supplemental balance sheet information(In thousands)
Operating leases  
Operating lease right-of-use assets, net(1)
$11,492,805$8,286,694
Operating lease liabilities - current, classified within "Other accrued liabilities"
$31,706$31,843
Operating lease liabilities - long-term(2)
11,802,4648,390,117
Total operating lease liabilities$11,834,170$8,421,960
 
Finance leases
Finance lease right-of-use assets, net, classified within "Property and equipment, net"
$151,909$200,980
Finance lease liabilities - current, classified within "Other accrued liabilities"
$87,665$80,193
Finance lease liabilities - long-term, classified within "Other long-term obligations"
75,560134,287
Total finance lease liabilities$163,225$214,480
 
Weighted average remaining lease term (years)
Operating leases2930
Finance leases23
 
Weighted average discount rate (%)
Operating leases7 8 
Finance leases3 3 

(1)As of December 31, 20172021 and 2016,2020, operating lease right-of-use assets, net included $3.6 billion and $3.7 billion related to the Company has recorded an estimate of its remaining liability on a discounted basis of $10 millionBellagio lease, respectively and $8 million, respectively, in “Other accrued liabilities”$4.0 billion related to the Mandalay Bay and $23 million and $63 million, respectively, in “Other long-term obligations.”

MGM Grand Paradise Macau deferred cash payment. On September 1, 2016, the Company purchased 188.1 million common shares of its MGM China subsidiary from Grand Paradise Macau (“GPM”), an entity controlled by Ms. Ho, Pansy Catilina Chiu King (“Ms. Ho”). As partLas Vegas lease for each of the consideration for the purchase, the Company agreed to pay GPM a deferred cash payment of $50 million, which will be paid in amounts equal to the ordinary dividends received on such shares, with a final lump sum payment due on the fifth anniversary of the closing date of the transaction if any portion of the deferred cash payment remains unpaid at that time. In 2017, the total amount paid under the deferred cash payment arrangement was $7 million. respective periods.

(2)As of December 31, 2017,2021 and 2020, operating lease liabilities – long-term included $3.8 billion related to the Company recorded a remaining liabilityBellagio lease for each of the respective periods, and $4.2 billion and $4.1 billion related to the Mandalay Bay and MGM Grand Las Vegas lease, respectively.

92


 Year Ended December 31,
 2021 20202019
Cash paid for amounts included in the measurement of lease liabilities(In thousands)
Operating cash outflows from operating leases$669,681 $572,186 $117,072 
Operating cash outflows from finance leases4,761 2,956 1,164 
Financing cash outflows from finance leases(1)
73,257 34,494 10,311 
 
ROU assets obtained in exchange for new lease liabilities
Operating leases$3,388,120 $4,120,955 $3,814,115 
Finance leases24,433 177,085 84,934 

(1)Included within “Other” within cash flows from financing activities on a discounted basisthe consolidated statements of $39 million in “Other long-term obligations.”

T-Mobile Arena senior credit facility.cash flows.


Maturities of lease liabilities were as follows:
 Operating Leases Finance Leases
Year ending December 31,(In thousands)
2022$838,062 $90,633 
2023850,305 73,568 
2024862,796 1,747 
2025876,046 1,253 
2026885,863 24 
Thereafter26,660,145 — 
Total future minimum lease payments30,973,217 167,225 
Less: Amount of lease payments representing interest(19,139,047)(4,000)
Present value of future minimum lease payments11,834,170 163,225 
Less: Current portion(31,706)(87,665)
Long-term portion of lease liabilities$11,802,464 $75,560 


NOTE 12 – COMMITMENTS AND CONTINGENCIES

Litigation. The Company is a party to a repayment guarantee for the term loan B facility under the Las Vegas Arena Company’s senior credit facility. Asvarious legal proceedings, most of December 31, 2017, the term loan B outstanding balance was $50 million. As of December 31, 2017, the Companywhich relate to routine matters incidental to its business. Management does not believe it is probable that itthe outcome of such proceedings will need to performhave a material adverse effect on the guarantee.

Company’s financial position, results of operations or cash flows.


Other guarantees. The Company and its subsidiaries are party to various guarantee contracts in the normal course of business, which are generally supported by letters of credit issued by financial institutions. The Company’s senior credit facility limits the amount of letters of credit that can be issued to $250 million, MGP’s senior credit facility limits the amount to $75 million, and MGM China’s credit facility limits the amount to $100 million.$1.35 billion. At December 31, 2017, $152021, $33 million in letters of credit were outstanding under the Company’s senior credit facility. The Operating Partnership’s senior credit facility and $39 million inlimits the amount of letters of credit were outstanding under MGM China’s credit facility.that can be issued to $75 million. No letters of credit were outstanding under the MGPOperating Partnership’s senior credit facility at December 31, 2017.2021. The amount of available borrowings under each of the credit facilities is reduced by any outstanding letters of credit.

October 1 litigation.


MGM China bank guarantee.In connection with the extension of the expiration of the gaming subconcession to June 2022, MGM Grand Paradise provided a bank guarantee to the government of Macau in May 2019 to warrant the fulfillment of an existing commitment of labor liabilities upon expiration of the gaming subconcession in June 2022. The amount of the bank guarantee was approximately $102 million as of December 31, 2021 when giving effect to foreign currency exchange rate fluctuations.

Bellagio BREIT Venture shortfall guarantee.The Company and/provides a shortfall guarantee of the $3.01 billion principal amount of indebtedness (and any interest accrued and unpaid thereon) of Bellagio BREIT Venture, which matures in 2029. The terms of the shortfall guarantee provide that after the lenders have exhausted certain remedies to collect on the
93

obligations under the indebtedness, the Company would then be responsible for any shortfall between the value of the collateral, which is the real estate assets of Bellagio owned by Bellagio BREIT Venture, and the debt obligation. This guarantee is accounted for under ASC 460 at fair value; such value is immaterial.

MGP BREIT Venture shortfall guarantee. The Company provides a shortfall guarantee of the $3.0 billion principal amount of indebtedness (and any interest accrued and unpaid thereon) of MGP BREIT Venture, which has an initial term of 12 years, maturing in 2032, with an anticipated repayment date of March 2030. The terms of the shortfall guarantee provide that after the lenders have exhausted certain remedies to collect on the obligations under the indebtedness, the Company would then be responsible for any shortfall between the value of the collateral, which is the real estate assets of Mandalay Bay and MGM Grand Las Vegas, owned by MGP BREIT Venture, and the debt obligation. This guarantee is accounted for under ASC 460 at fair value; such value is immaterial.

MGP BREIT Venture bad acts guarantee. The Operating Partnership provides a guarantee for the losses incurred by the lenders of the indebtedness of MGP BREIT Venture arising out of certain bad acts by the Operating Partnership, its venture partner, or certain of its subsidiaries have been namedthe venture, such as defendants in a number of lawsuits related to the October 1, 2017 shooting in Las Vegas. The matters involve in large degree the same legal and factual issues, in each case being filed on behalf of individuals who are seeking damages for emotional distress, physical injury, medical expenses, economic damages and/fraud or wrongful deathwillful misconduct, based on assertions that the Company and/or certainparty’s percentage ownership of its subsidiaries were negligent. Pending lawsuits were first filed in October 2017 and include actions filed by multiple individuals in the District Court of Clark County, Nevada and in the Superior Court of Los Angeles County, California. SomeMGP BREIT Venture. This guarantee is capped at 10% of the original actions have been voluntarily dismissed, and plaintiffs’ counsel indicate they anticipate re-filingprincipal amount outstanding at the lawsuits in similar form. Additional lawsuits related to this incident may be filed in the future.

The Company is currently unable to reliably predict the developments in, outcome of, and economic costs and other consequences of pending or future litigation related to this matter. The Company will continue to investigate the factual and legal defenses, and evaluate these matters based on subsequent events, new information and future circumstances. The Company intends to defend against these lawsuits and ultimately believes it should prevail, but litigation of this type is inherently unpredictable. Although there are significant procedural, factual and legal issues to be resolved that could significantly affect the Company’s belief as to the possibility of liability, the Company currently believes that it is reasonably possible that it could incur liability in connection with certain of these lawsuits. The foregoing determination was made in accordance with generally accepted accounting principles, as codified in ASC 450-20, and is not an admission of any liability on the parttime of the Company or any ofloss. The Operating Partnership and its affiliates. Given that these cases are inventure partner have separately indemnified each other for the early stages and in lightother party’s share of the uncertainties surrounding them, the Company does not currently possess sufficient information to determine a range of reasonably possible liability. In the event the Company incurs anyoverall liability the Company believes itexposure, if at fault. The guarantee is unlikely it would incur losses in connection with these claims in excess of its insurance coverage. In addition, the Company’s general liability insurance coverage provides, as part of the contractual “duty to defend”, payment of legal fees and associated costs incurred to defend covered lawsuits that are filed arising from the October 1, 2017 shooting in Las Vegas. Payment ofaccounted for under ASC 460 at fair value; such fees and costsvalue is in addition to (and not limited by) the limits of the insurance policies and does not erode the total liability coverage available. The insurance carriers have not expressed any reservation of rights or coverage defenses that indicate they dispute coverage under the applicable policies.

immaterial.


Other litigation. The Company is a party to various other legal proceedings, most of which relate to routine matters incidental to its business. Management does not believe that the outcome of such proceedings will have a material adverse effect on the Company’s financial position, results of operations or cash flows.


94

NOTE 13 — STOCKHOLDERS’ EQUITY


Accumulated Other Comprehensive Loss

Changes in accumulated other comprehensive loss attributable to MGM Resorts International are as follows:

 Currency Translation AdjustmentsCash Flow HedgesOtherTotal
 (In thousands)
Balances, January 1, 2019$(18,872)$9,144 $1,172 $(8,556)
Other comprehensive income (loss) before reclassifications28,870 (28,783)— 87 
Amounts reclassified from accumulated other comprehensive loss to interest expense— (5,599)— (5,599)
Amounts reclassified from accumulated other comprehensive loss related to de-designation of interest rate swaps to "Other, net"— 4,877 — 4,877 
Other comprehensive income (loss), net of tax28,870 (29,505)— (635)
Other changes in accumulated other comprehensive loss:
Empire City MGP transaction— — 195 195 
MGP Class A share issuances— — 1,512 1,512 
Park MGM Transaction— — 16 16 
Northfield transaction— — (2)(2)
Other— — 481 481 
Changes in accumulated other comprehensive loss28,870 (29,505)2,202 1,567 
Other comprehensive (income) loss attributable to noncontrolling interest(12,745)9,532 — (3,213)
Balances, December 31, 2019(2,747)(10,829)3,374 (10,202)
Other comprehensive income (loss) before reclassifications27,762 (94,740)— (66,978)
Amounts reclassified from accumulated other comprehensive loss to interest expense— 17,922 — 17,922 
Amounts reclassified from accumulated other comprehensive loss to "Other, net"— (2,547)— (2,547)
Other comprehensive income (loss), net of tax27,762 (79,365)— (51,603)
Other changes in accumulated other comprehensive loss:
MGP Class A share issuances— — 646 646 
MGP BREIT Venture Transaction— — (59)(59)
Redemption of Operating Partnership units— — 8,773 8,773 
Other— — (1,018)(1,018)
Changes in accumulated other comprehensive loss27,762 (79,365)8,342 (43,261)
Other comprehensive (income) loss attributable to noncontrolling interest(12,051)34,837 — 22,786 
Balances, December 31, 202012,964 (55,357)11,716 (30,677)
Other comprehensive income (loss) before reclassifications(24,655)12,588 — (12,067)
Amounts reclassified from accumulated other comprehensive loss to interest expense— 22,200 — 22,200 
Other comprehensive income (loss), net of tax(24,655)34,788 — 10,133 
Other changes in accumulated other comprehensive loss
MGP Class A share issuances— — 3,240 3,240 
Redemption of Operating Partnership units— — 5,327 5,327 
Other— — (2,358)(2,358)
Changes in accumulated other comprehensive loss(24,655)34,788 6,209 16,342 
Other comprehensive (income) loss attributable to noncontrolling interest10,784 (21,065)— (10,281)
Balances, December 31, 2021$(907)$(41,634)$17,925 $(24,616)

At December 31, 2021, the estimated amount currently recorded in accumulated other comprehensive loss that will be recognized in earnings over the next 12 months is not material.

95

Noncontrolling interest


The following is a summary of net income attributable to MGM Resorts International and transfers to noncontrolling interest.

interest, which shows the effects of changes in the Company’s ownership interest in a subsidiary on the equity attributable to the Company:

 

 

 

 

For the Years Ended December 31,

 

 

 

 

 

2017

 

 

2016

 

 

 

 

 

(In thousands)

 

Net income attributable to MGM Resorts International

 

 

 

$

1,960,286

 

 

$

1,101,440

 

Transfers from/(to) to noncontrolling interest:

 

 

 

 

 

 

 

 

 

 

MGP formation transactions

 

 

 

 

—

 

 

 

(150,414

)

Borgata transaction

 

 

 

 

—

 

 

 

(18,385

)

MGP Class A share issuance

 

 

 

 

35,138

 

 

 

—

 

MGM National Harbor transaction

 

 

 

 

(12,497

)

 

 

—

 

MGM China transaction

 

 

 

 

—

 

 

 

(45,554

)

Other

 

 

 

 

(2,889

)

 

 

—

 

Net transfers from/(to) noncontrolling interest

 

 

 

 

19,752

 

 

 

(214,353

)

Change from net income attributable to MGM Resorts International and transfers to noncontrolling interest

 

 

 

$

1,980,038

 

 

$

887,087

 

 For the Years Ended December 31,
 202120202019
 (In thousands)
Net income (loss) attributable to MGM Resorts International$1,254,370 $(1,032,724)$2,049,146 
Transfers from/(to) noncontrolling interest:
Empire City MGP transaction— — (18,718)
MGP Class A share issuances103,174 64,834 151,976 
Park MGM Transaction— — (1,968)
Northfield transaction— — 21,679 
MGP BREIT Venture Transaction— (6,562)— 
Redemption of Operating Partnership units176,659 92,632 — 
Other(5,062)(1,759)(935)
Net transfers from noncontrolling interest274,771 149,145 152,034 
Change from net income (loss) attributable to MGM Resorts International and transfers to noncontrolling interest$1,529,141 $(883,579)$2,201,180 


Noncontrolling interest ownership transactions

Empire City MGP formation transactions. In 2016, the Company adjusted the carrying value of the noncontrolling interests to reflect MGP’s Class A shareholders’ initial 26.7% ownership interest in the consolidated net assets of MGP related to MGP’s IPO and related transactionstransaction. As further discussed in Note 1,18, on January 29, 2019, MGP acquired the developed real property associated with an offsetting adjustment to capital in excess of par value. Subsequent to the MGP formation transactions,Empire City from the Company indirectly owned 73.3% of partnership units in the Operating Partnership.

Borgata transaction. In 2016, MGP acquired Borgata’s real property from a subsidiary of the Company in exchange for MGP’s assumption of $545 million of indebtedness andconsideration that included the issuance of 27.4approximately 13 million Operating Partnership units to a subsidiary of the Company. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interestsinterests’ ownership percentage of the Operating Partnership’s net assets, including assets and liabilities transferred, with an offsetting adjustmentadjustments to capital in excess of par value.value and accumulated other comprehensive income. Subsequent to the BorgataEmpire City MGP transaction, the Company indirectly owned 76.3%74.6% of the partnership units in the Operating Partnership.

MGP Class A share issuance. In September 2017,issuance – January 2019.On January 31, 2019, MGP completed a publican offering of 13,225,000approximately 20 million of its Class A shares, including 1,725,000 shares sold pursuantshares. In connection with the offering, the Operating Partnership issued an equal amount of Operating Partnership units to the underwriters’ over-allotment option, at a public offering price of $30.60 per share for net proceeds of $388 million.MGP. The Company has adjusted the carrying value of the noncontrolling interests as a result of MGP’s Class A share issuance to adjust for the change in noncontrolling interestsinterests’ ownership percentage of the Operating Partnership'sPartnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to MGP’sthe issuance, of the incremental shares, the Company indirectly owned 72.3%69.7% of the partnership units in the Operating Partnership.

Park MGM National Harbor transaction. In October 2017,Transaction. As further discussed in Note 18, on March 7, 2019, the Company entered into an amendment to the MGP acquiredmaster lease with respect to improvements made by the long-term leasehold interest and real property associated with MGM National Harbor from a subsidiaryCompany related to the rebranding of the Company in exchangePark MGM and NoMad Las Vegas property (the “Park MGM Transaction”) for cash of $463 million, the assumption of $425 million of indebtedness, which was immediately repaid by MGP on the closing date, andconsideration included the issuance of 9.8approximately 1 million Operating Partnership units to a subsidiary of the Company. The Company adjusted the carrying value of the noncontrolling interest to adjustinterests for the change in noncontrolling interestinterests’ ownership percentage of the Operating Partnership’s net assets, including assets and liabilities transferred, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the MGM National Harbor transaction,issuance, the Company indirectly owned 73.4%69.8% of the partnership units in the Operating Partnership.

MGM China transaction. In September 2016,

Northfield transaction. As further discussed in Note 18, in April 2019, the Company acquired 188.1the membership interests of Northfield from MGP for consideration of approximately 9 million ordinary shares of MGM China from GPM. As a result ofOperating Partnership units that were ultimately redeemed by the transaction,Operating Partnership and MGP retained the Company owns approximately 56% of MGM China’s outstanding common shares. Ms. Ho owned approximately 22.5% immediately following the transaction. As consideration for the MGM China shares, the Company issued 7,060,492 shares of its common stock and paid $100 million to GPM. In addition, the Company agreed to pay GPM a deferred cash payment of $50 million. See Note 12 for additional information regarding the deferred cash payment.real estate assets. The Company adjusted the


carrying value of the noncontrolling interest and accumulated other comprehensive income to reflectinterests for the change in MGM China’s noncontrolling interests’ ownership interest resulting from the transaction. The difference between the fair valuepercentage of the consideration paid and the aforementionedOperating Partnership’s net assets, with offsetting adjustments was recognized as a reduction to capital in excess of par value.

Dividends

value and accumulated other comprehensive income. Subsequent to the transaction, the Company indirectly owned 68.8% of the partnership units in the Operating Partnership.


96

MGP Class A share issuances – At-the-Market (“ATM”) program. During the year ended December 31, 2019, MGP issued approximately 5 million Class A shares under its ATM program. In connection with the issuances, the Operating Partnership issued an equal amount of Operating Partnership units to MGP during the year ended December 31, 2019. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the collective issuances, the Company indirectly owned 67.6% of the partnership units in the Operating Partnership.
MGP Class A share issuance – November 2019.On November 22, 2019, MGP completed an offering of 30 million of its Class A shares. The offering consisted of 18 million shares sold directly to the underwriters at closing and 12 million shares sold to forward purchasers under forward sale agreements. In connection with the offering, the Operating Partnership issued 18 million Operating Partnership units to MGP. The Company adjusted the carrying value of the noncontrolling interests as a result of MGP’s Class A share issuance to adjust for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the issuance, the Company indirectly owned 63.7% of the partnership units in the Operating Partnership.

MGP Class A share issuance – Forward settlements. On February 11, 2020 through February 13, 2020, MGP settled approximately 13 million Class A shares issued under forward sales agreements from MGP's November 2019 offering and under MGP's ATM program. In connection with the settlements, the Operating Partnership issued an equal amount of Operating Partnership units to MGP. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the settlements, the Company indirectly owned 61.2% of the partnership units in the Operating Partnership.

MGP Class A share issuance – BREIT. On February 14, 2020, in connection with MGP’s registered sale of approximately 5 million Class A shares to BREIT, the Operating Partnership issued an equal amount of Operating Partnership units to MGP. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the issuance, the Company indirectly owned 60.3% of the partnership units in the Operating Partnership.

MGP Class A share issuance – MGP BREIT Venture Transaction. In February 2020, in connection with the MGP BREIT Venture Transaction, the Operating Partnership issued approximately 3 million Operating Partnership units to the Company as discussed in Note 1. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the issuance, the Company indirectly owned 60.6% of the partnership units in the Operating Partnership.

Redemption of Operating Partnership units. On May 18, 2020, the Operating Partnership redeemed approximately 30 million Operating Partnership units from the Company for $700 million pursuant to the waiver agreement discussed in Note 1. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the redemption, the Company indirectly owned 56.7% of the partnership units in the Operating Partnership. Further, on December 2, 2020, the Operating Partnership redeemed approximately 24 million Operating Partnership units from the Company for $700 million pursuant to the waiver agreement discussed in Note 1. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive income. Subsequent to the redemption and as of December 31, 2020, the Company indirectly owned 53.0% of the partnership units in the Operating Partnership.

MGP Class A share issuance – March 2021. On March 15, 2021, MGP completed an offering of 22 million of its Class A shares, the proceeds of which were used to partially satisfy MGP’s obligations pursuant to the notice of redemption delivered by certain MGM subsidiaries, discussed below. Subsequent to MGP’s Class A share issuance and the redemption of Operating Partnership units, discussed below, the Company indirectly owned 42.1% of the partnership units in the Operating Partnership.

Redemption of Operating Partnership units – March 2021. In March 2021, subsidiaries of the Company delivered a notice of redemption to MGP covering approximately 37 million Operating Partnership units that they held in accordance with the terms of the Operating Partnership’s partnership agreement. Upon receipt of the notice of redemption, MGP formed a conflicts committee to determine the mix of consideration that it would provide for the Operating
97

Partnership units. The conflicts committee determined that MGP would redeem approximately 15 million Operating Partnership units for cash (with such Operating Partnership units retired upon redemption) and would satisfy its remaining obligation under that notice covering the remaining 22 million Operating Partnership units using the proceeds, net of the underwriters’ discount, of MGP’s Class A offering, for aggregate cash proceeds received by the Company of approximately $1.2 billion. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive loss. Subsequent to the collective transactions, the Company indirectly owned 42.1% of the partnership units in the Operating Partnership.

MGP Class A share issuances – ATM program. During the year ended December 31, 2021, MGP issued approximately 3 million Class A shares under its ATM program, which completed its ATM program. In connection with the issuances, the Operating Partnership issued an equal amount of Operating Partnership units to MGP. The Company adjusted the carrying value of the noncontrolling interests for the change in noncontrolling interests’ ownership percentage of the Operating Partnership’s net assets, with offsetting adjustments to capital in excess of par value and accumulated other comprehensive loss. Subsequent to the collective issuances, the Company indirectly owned 41.6% of the partnership units in the Operating Partnership.
Other equity activity

MGM Resorts International dividends.The Company paid, or will pay, On February 9, 2022 the following dividends:

$68 millionCompany’s Board of Directors approved a quarterly dividend or $0.12of $0.0025 per share tothat will be paidpayable on March 15, 20182022 to holders of record as ofon March 9, 2018;

10, 2022.

$62 million quarterly dividend in December 2017, or $0.11 per share; and


$63 million quarterly dividend in each of September, June, and March 2017, or $0.11 per share.

The Company intends to pay a quarterly dividend in each future quarter subject to the Company’s operating results, cash requirements and financial conditions, any applicable provisions of state law that may limit the amount of available funds, and compliance with covenants and financial ratios related to existing or future agreements governing the indebtedness at the Company’s subsidiaries and any limitations in other agreements such subsidiaries may have with third parties.

Stock repurchase program

MGM Resorts International stock repurchase program. In September 2017,February 2020, upon substantial completion of the May 2018 $2.0 billion stock repurchase program, the Company’s Board of Directors authorized a $1.0$3.0 billion stock repurchase program (the “Stock Repurchase Program”).program. Under the Stock Repurchase Program,stock repurchase program, the Company may repurchase shares from time to time in the open market or in privately negotiated agreements. Repurchases of common stock may also be made under a Rule 10b5-1 plan, which would permit common stock to be repurchased when the Company might otherwise be precluded from doing so under insider trading laws. The timing, volume and nature of stock repurchases will be at the sole discretion of management, dependent on market conditions, applicable securities laws, and other factors, and may be suspended or discontinued at any time.

In September 2017,


During the year ended December 31, 2019, the Company repurchased 10approximately 36 million shares of its common stock at $32.75an average purchase price of $28.77 per share for a totalan aggregate amount of $328$1.0 billion. Repurchased shares were retired.

During the year ended December 31, 2020, the Company repurchased approximately 11 million shares of its common stock at an average purchase price of $32.57 per share for an aggregate amount of $354 million. Repurchased shares were retired. The

During the year ended December 31, 2021, the Company repurchased approximately 43 million shares of its common stock at an average price of $40.70 per share for an aggregate amount of $1.8 billion. Repurchased shares were retired. During the year ended December 31, 2021, the Company completed its May 2018 $2.0 billion stock repurchase program and the remaining availability under the Stock Repurchase ProgramFebruary 2020 $3.0 billion stock repurchase program was approximately $672 million$1.3 billion as of December 31, 2017.

2021.


Subsequent to the year ended December 31, 2021, the Company repurchased approximately 15 million shares of its common stock at an average price of $43.88 per share for an aggregate amount of $670 million, which included the February 2022 repurchase of 4.5 million shares at a price of $45.00 per share for an aggregate amount of $202.5 million from funds managed by Corvex Management LP, a related party. Repurchased shares were retired.

NOTE 14 — STOCK-BASED COMPENSATION


MGM Resorts 2005 Omnibus Incentive Plan. The Company’s omnibus incentive plan, as amended (the “Omnibus Plan”), allows it to grant up to 45 million shares or share-based awards, such as stock options, stock appreciation rights (“SARs”), restricted stock units (“RSUs”), performance share units (“PSUs”) and other stock-based awards to eligible directors, officers and employees of the Company and its subsidiaries.


As of December 31, 2017,2021, the Company had an aggregate of approximately 2120 million shares of common stock available for grant as share-based awards under the Omnibus Plan. Additionally, as of December 31, 2017,2021, the Company had approximately 91 million aggregate stock options and SARs outstanding and approximately 6 million aggregate RSUs and PSUs outstanding, including deferred share units and dividend equivalent rightsunits related to RSUs and PSUs.

Intrinsic value. The following table includes information related to the intrinsic value:

 

 

 

Year ended

 

 

 

 

December 31, 2017

 

 

 

 

(In thousands)

 

Share-based awards exercised and RSUs and PSUs vested

 

 

$

100,264

 

Stock options and SARs outstanding

 

 

 

112,604

 

Stock options and SARs vested and expected to vest

 

 

 

111,284

 

Stock options and SARs exercisable

 

 

 

78,865

 

98


As of December 31, 2017,2021, there was a total of $127$85 million of unamortized compensation related to stock options, SARs, RSUs, and PSUs, which is expected to be recognized over a weighted-averageweighted average period of 2.11.6 years.



MGM Growth Properties 2016 Omnibus Incentive Plan and MGM China Share Option Plan. The Company’s subsidiaries, MGP and MGM China, each adopted their own equity award plans for the issuance of share-based awards to each subsidiary’s eligible recipients. As of December 31, 2017, the MGP Omnibus Plan had approximately 244,000 aggregate RSUs and PSUs outstanding, including deferred share units and dividend equivalent rights related to RSUs and PSUs. As of December 31, 2017, MGM China had approximately 77 million stock options outstanding.


Recognition of compensation cost. Compensation cost was recognized as follows:

 

Year Ended December 31,

 

 Year Ended December 31,

 

2017

 

 

2016

 

 

2015

 

 202120202019

Compensation cost:

 

(In thousands)

 

Compensation cost:(In thousands)

Omnibus Plan

 

$

49,383

 

 

$

43,661

 

 

$

33,742

 

Omnibus Plan$53,683 $93,096 $76,995 

MGM Growth Properties Omnibus Incentive Plan

 

 

2,568

 

 

 

3,401

 

 

 

—

 

MGM Growth Properties Omnibus Incentive Plan4,827 2,854 2,277 

MGM China Share Option Plan

 

 

10,571

 

 

 

8,545

 

 

 

9,260

 

MGM China Share Option Plan6,673 11,006 9,566 

Total compensation cost

 

 

62,522

 

 

 

55,607

 

 

 

43,002

 

Total compensation cost65,183 106,956 88,838 

Less: Reimbursed costs and capitalized cost

 

 

(1,398

)

 

 

(1,350

)

 

 

(1,156

)

Less: Reimbursed costs and capitalized cost(1,198)(2,118)(3,487)

Compensation cost after reimbursed costs and capitalized cost

 

 

61,124

 

 

 

54,257

 

 

 

41,846

 

Compensation cost after reimbursed costs and capitalized cost63,985 104,838 85,351 

Less: Related tax benefit

 

 

(18,650

)

 

 

(16,782

)

 

 

(11,230

)

Less: Related tax benefit(12,982)(20,605)(16,752)

Compensation cost, net of tax benefit

 

$

42,474

 

 

$

37,475

 

 

$

30,616

 

Compensation cost, net of tax benefit$51,003 $84,233 $68,599 


NOTE 15 — EMPLOYEE BENEFIT PLANS


Multiemployer benefit plans. The Company currently participates in multiemployer pension plans in which the risks of participating differs from single-employer plans in the following aspects:

a)

a)Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers;

b)

b)If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers;

c)

c)If an entity chooses to stop participating in some of its multiemployer plans, the entity may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability; and

d)

d)If the plan is terminated by withdrawal of all employers and if the value of the nonforfeitable benefits exceeds plan assets and withdrawal liability payments, employers are required by law to make up the insufficient difference.

The Company’s participation in these plans is presented below.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EIN/Pension

 

Pension Protection Act Zone Status (2)

 

FIP/RP

 

Contributions by the Company

(in thousands)(4)

 

 

Surcharge

 

Expiration Dates of Collective Bargaining

Pension Fund(1)

 

Plan Number

 

2016

 

2015

 

Status (3)

 

2017

 

 

2016

 

 

2015

 

 

Imposed

 

Agreements

Southern Nevada Culinary and Bartenders Pension Plan

 

88-6016617/001

 

Green

 

Green

 

No

 

$

45,297

 

 

$

44,001

 

 

$

41,904

 

 

No

 

5/31/2018(5)

Legacy Plan of the National Retirement Fund (NRF)(6)

 

13-6130178/001

 

Red

 

Red

 

Yes

 

$

9,416

 

 

$

3,788

 

 

$

—

 

 

Yes

 

2/29/2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

The Company was listed in the plan's Form 5500 as providing more than 5% of the total contributions for the plan years 2016 and 2015 for the Southern Nevada Culinary and Bartenders Pension Plan and for the plan year 2016 for the NRF. At the date the financial statements were issued, Form 5500 was not available for the plan year 2017.

(2)

The zone status is based on information that the Company received from the plan and is certified by the plan's actuary. Plans in the red zone are generally less than 65% funded (critical status) and plans in the green zone are at least 80% funded.

 EIN/Pension
Pension Protection Act Zone Status (2)
FIP/RP
Contributions by the Company
(in thousands)(4)
SurchargeExpiration Dates of Collective Bargaining
Pension Fund(1)
Plan Number20202019
Status (3)
202120202019ImposedAgreements
Southern Nevada Culinary and Bartenders Pension Plan88-6016617/001GreenGreenNo$37,242 $24,610 $52,218 No
05/31/2023(5); 05/31/2024(5)
The Legacy Plan of the UNITE HERE Retirement Fund (UHF)82-0994119/001RedRedImplemented$7,683 $5,151 $10,151 No5/31/2022

(3)

Indicates plans for which a Financial Improvement Plan (FIP) or a Rehabilitation Plan (RP) is either pending or has been implemented.

(1)The Company was listed in the plan's Form 5500 as providing more than 5% of the total contributions for the plan years 2020 and 2019 for both plans. At the date the financial statements were issued, Form 5500 was not available for the plan year 2021.

(4)

There have been no significant changes that affect the comparability of contributions, other than those for the Legacy Plan of the National Retirement Fund which reflect the period from acquisition of Borgata of August 1, 2016 through December 31, 2016 within the 2016 column and a full-year of contributions within the 2017 column.

(2)The zone status is based on information that the Company received from the plan and is certified by the plan's actuary. Plans in the red zone are generally less than 65% funded (critical status) and plans in the green zone are at least 80% funded.

(5)

The Company is party to ten collective bargaining agreements (CBA) that require contributions. The agreements between CityCenter Hotel Casino, LLC, Bellagio, Mandalay Corp., MGM Grand Hotel, LLC and the Local Joint Executive Board of Las Vegas are the most significant because more than half of the Company’s employee participants in this plan are covered by those four agreements.

(3)Indicates plans for which a Financial Improvement Plan (FIP) or a Rehabilitation Plan (RP) is either pending or has been implemented.

(4)There have been no significant changes that affect the comparability of contributions.

(6)

In December 2017, the Pension Benefit Guaranty Corporation approved the spin-off of the UNITE HERE portion of the NRF to the plan of the newly-formed UNITE HERE Retirement Fund (UHF). As a result of the spin-off, the pension liabilities as well as certain assets of the plan were transferred to the new UHF Plan. The terms of the UHF Plan are identical to the NRF. The spin-off was effective as of January 1, 2018.

(5)The Company is party to 11 collective bargaining agreements (CBA) that require contributions with the Local Joint Executive Board of Las Vegas, which is made up of the Culinary Workers Union and Bartenders Union. The agreements between Aria, Bellagio, Mandalay Bay, and MGM Grand Las Vegas are the most significant because more than half of the Company’s employee participants in this plan are covered by those 4 agreements.


Multiemployer Benefit Plans Other Than Pensionsbenefit plans other than pensions. Pursuant to its collective bargaining agreements referenced above, the Company also contributes to UNITE HERE Health (the “Health Fund”), which provides healthcare benefits to
99

its active and retired members. The Company contributed $183$143 million, $187$138 million, and $192$206 million to the Health Fund in the years ended December 31, 2017, 2016,2021, 2020, and 2015,2019, respectively.

Self-insurance. The Company is self-insured for most health care benefits and workers compensation for its non-union employees. The liability for self-insurance was $87 million and $83 million at December 31, 2017 and 2016, respectively, which is included in “Other accrued liabilities.”


NOTE 16 — PROPERTY TRANSACTIONS, NET


Property transactions, net consisted of the following:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Grand Victoria investment impairment

 

$

—

 

 

$

—

 

 

$

17,050

 

Gain on sale of Circus Circus Reno and Silver Legacy investment

 

 

—

 

 

 

—

 

 

 

(23,002

)

Other property transactions, net

 

 

50,279

 

 

 

17,078

 

 

 

41,903

 

 

 

$

50,279

 

 

$

17,078

 

 

$

35,951

 

 Year Ended December 31,
 202120202019
 (In thousands)
Loss related to sale of Circus Circus Las Vegas and adjacent land$— $— $220,294 
Other property transactions, net(67,736)93,567 55,508 
 $(67,736)$93,567 $275,802 

Grand Victoria investment. See Note 7 for additional information related to the Grand Victoria investment impairment charge in 2015.


Circus Circus RenoLas Vegas and Silver Legacy investment sale. See Note 5 for additional information related toadjacent land. In December 2019, the Company completed the sale of Circus Circus RenoLas Vegas and Note 7the adjacent land for $825 million, which consisted of $663 million paid in cash and a secured note due 2024 with a face value of $163 million and fair value of $134 million. The note has a stated interest rate of 3% for the first two years, 4% for following two years, and 4.5% for the fifth year and is secured by the borrower with the land adjacent to Circus Circus Las Vegas as collateral with an effective interest rate of 7.31%. The interest on the note, which is comprised of the stated interest and the discount on the note, amortizes into interest income using the effective interest method over the length of the agreement. The carrying value of the note receivable was $155 million and $144 million as of December 31, 2021 and 2020, respectively, and was recorded within “Other long-term assets, net” in the consolidated balance sheets.

During the third quarter of 2019, the Company recorded a non-cash impairment charge of $219 million, which reflects the amount by which the assets’ carrying value exceeds the assets’ fair value (expected selling price). The Company further discussionrecognized a loss of $2 million during the fourth quarter of 2019 primarily relating to selling costs. The assets and liabilities of Circus Circus Las Vegas and the adjacent land of $810 million and $14 million, respectively, primarily consisted of property and equipment, net of $785 million. Circus Circus Las Vegas was not classified as discontinued operations for the year ended December 31, 2019 because the Company concluded that the sale is not a strategic shift that has a major effect on the Company’s operations or its financial results and it does not represent a major geographic segment or product line.

Other. Other property transactions, net in 2021 includes a gain of $76 million relating to the sale of art and a gain of $29 million related to a reduction in the Company’s 50%estimate of contingent consideration related to the Empire City acquisition, partially offset by an other-than-temporary impairment charge of $22 million related to an investment in Silver Legacyan unconsolidated affiliate, as discussed in 2015.

Other.Note 6, as well as miscellaneous asset disposals and write-downs.


Other property transactions, net in 2020 includes other-than-temporary impairment charges of $64 million related to an investment in an unconsolidated affiliate, as discussed in Note 6, a loss of $17 million related to production show costs, as well as miscellaneous asset disposals and write-downs.

Other property transactions, net for 2019 includes miscellaneous asset disposals and demolition costs in the periods presented in the above table, including a loss of $34 million related to the rebranding of the Monte Carlo Resort and Casino to Park MGM and NoMad Las Vegas in 2017, and a loss of $18 million in connection with the trade-in of Company aircraft in 2015.

costs.


100


NOTE 17 — SEGMENT INFORMATION


The Company’s management views each of its casino resorts as an operating segment. Operating segments are aggregated based on their similar economic characteristics, types of customers, types of services and products provided, the regulatory environments in which they operate and their management and reporting structure. The Company’s principal operating activities occur in two geographic regions: the United States and Macau S.A.R. The Company has aggregated its operationsoperating segments into twothe following reportable segments based on the similar characteristicssegments: Las Vegas Strip Resorts, Regional Operations and MGM China.

Las Vegas Strip Resorts. Las Vegas Strip Resorts consists of the operating segments: domestic resortsfollowing casino resorts: Aria (including Vdara) (upon acquisition in September 2021), Bellagio, MGM Grand Las Vegas (including The Signature), Mandalay Bay (including Delano and Four Seasons), The Mirage, Luxor, New York-New York (including The Park), Excalibur, Park MGM (including NoMad Las Vegas) and Circus Circus Las Vegas (until the sale of such property in December 2019).

Regional Operations. Regional Operations consists of the following casino resorts: MGM Grand Detroit in Detroit, Michigan; Beau Rivage in Biloxi, Mississippi; Gold Strike Tunica in Tunica, Mississippi; Borgata in Atlantic City, New Jersey; MGM National Harbor in Prince George’s County, Maryland; MGM Springfield in Springfield, Massachusetts; Empire City in Yonkers, New York (upon acquisition in January 2019); and MGM Northfield Park in Northfield Park, Ohio (upon MGM’s acquisition of the operations from MGP in April 2019).

MGM China. MGM China consists of MGM Macau and MGM Cotai.

The Company’s operations related to investments in unconsolidated affiliates, MGM Northfield Park (prior to April 1, 2019 as the operations were owned by MGP until that date), and certain other corporate operations and management services have not been identified as separate reportable segments; therefore, these operations are included in “Corporate and other” in the following segment disclosures to reconcile to consolidated results.

The Company’s management utilizes

Adjusted Property EBITDAEBITDAR is the Company’s reportable segment GAAP measure, which management utilizes as the primary profit measure for its reportable segments and underlying operating segments. Adjusted Property EBITDA is a measure defined as Adjusted EBITDA before corporate expense and stock compensation expense related to the Omnibus Plan and the MGM Growth Properties Omnibus Incentive Plan, which are not allocated to the reportable segments or each operating segment, as applicable. MGM China recognizes stock compensation expense related to the MGM China Share Option Plan which is included in the calculation of Adjusted EBITDA for MGM China. Adjusted EBITDAEBITDAR is a measure defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening and start-up expenses, NV Energy exit expense, gain on Borgata transaction, goodwill impairment charges,REIT transactions, net, restructuring costs (which represents costs related to severance, accelerated stock compensation expense, and consulting fees directly related to the operating model component of the MGM 2020 Plan), rent expense associated with triple-net operating and ground leases, income from unconsolidated affiliates related to investments in real estate ventures, property transactions, net.

net, and excludes gain on consolidation of CityCenter, net, gain related to CityCenter's sale of Harmon land recorded within income from unconsolidated affiliates, and corporate expense (which includes CEO transition expense and October 1 litigation settlement) and stock compensation expense, which are not allocated to each operating segment, and rent expense related to the master lease with MGP that eliminates in consolidation.

101


The following tables present the Company’s segment information:

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Net Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Domestic resorts

 

$

8,322,403

 

 

$

7,055,718

 

 

$

6,497,361

 

MGM China

 

 

1,970,494

 

 

 

1,920,487

 

 

 

2,214,767

 

Reportable segment net revenues

 

 

10,292,897

 

 

 

8,976,205

 

 

 

8,712,128

 

Corporate and other

 

 

481,007

 

 

 

478,918

 

 

 

477,940

 

 

 

$

10,773,904

 

 

$

9,455,123

 

 

$

9,190,068

 

Adjusted Property EBITDA

 

 

 

 

 

 

 

 

 

 

 

 

Domestic resorts

 

$

2,514,819

 

 

$

2,063,016

 

 

$

1,689,966

 

MGM China

 

 

524,953

 

 

 

520,736

 

 

 

539,881

 

Reportable segment Adjusted Property EBITDA

 

 

3,039,772

 

 

 

2,583,752

 

 

 

2,229,847

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other operating income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

Corporate and other

 

 

(202,675

)

 

 

211,932

 

 

 

9,073

 

NV Energy exit expense

 

 

40,629

 

 

 

(139,335

)

 

 

—

 

Preopening and start-up expenses

 

 

(118,475

)

 

 

(140,075

)

 

 

(71,327

)

Property transactions, net

 

 

(50,279

)

 

 

(17,078

)

 

 

(35,951

)

Goodwill impairment

 

 

—

 

 

 

—

 

 

 

(1,467,991

)

Gain on Borgata transaction

 

 

—

 

 

 

430,118

 

 

 

—

 

Depreciation and amortization

 

 

(993,480

)

 

 

(849,527

)

 

 

(819,883

)

Operating income (loss)

 

 

1,715,492

 

 

 

2,079,787

 

 

 

(156,232

)

Non-operating income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net of amounts capitalized

 

 

(668,745

)

 

 

(694,773

)

 

 

(797,579

)

Non-operating items from unconsolidated affiliates

 

 

(34,751

)

 

 

(53,139

)

 

 

(76,462

)

Other, net

 

 

(48,241

)

 

 

(72,698

)

 

 

(15,970

)

 

 

 

(751,737

)

 

 

(820,610

)

 

 

(890,011

)

Income (loss) before income taxes

 

 

963,755

 

 

 

1,259,177

 

 

 

(1,046,243

)

Benefit (provision) for income taxes

 

 

1,132,663

 

 

 

(22,299

)

 

 

6,594

 

Net income (loss)

 

 

2,096,418

 

 

 

1,236,878

 

 

 

(1,039,649

)

Less: Net (income) loss attributable to noncontrolling interests

 

 

(136,132

)

 

 

(135,438

)

 

 

591,929

 

Net income (loss) attributable to MGM Resorts International

 

$

1,960,286

 

 

$

1,101,440

 

 

$

(447,720

)

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets:

 

(In thousands)

 

Domestic resorts

 

$

16,428,885

 

 

$

16,451,461

 

 

$

13,261,882

 

MGM China

 

 

9,461,535

 

 

 

8,443,411

 

 

 

7,895,376

 

Reportable segment total assets

 

 

25,890,420

 

 

 

24,894,872

 

 

 

21,157,258

 

Corporate and other

 

 

3,338,882

 

 

 

3,333,625

 

 

 

4,099,837

 

Eliminated in consolidation

 

 

(70,124

)

 

 

(55,196

)

 

 

(41,917

)

 

 

$

29,159,178

 

 

$

28,173,301

 

 

$

25,215,178

 

 

 

December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and equipment, net:

 

(In thousands)

 

Domestic resorts

 

$

14,320,824

 

 

$

14,353,971

 

 

$

11,853,802

 

MGM China

 

 

3,827,391

 

 

 

2,857,626

 

 

 

1,896,815

 

Reportable segment property and equipment, net

 

 

18,148,215

 

 

 

17,211,597

 

 

 

13,750,617

 

Corporate and other

 

 

1,557,368

 

 

 

1,268,622

 

 

 

1,663,095

 

Eliminated in consolidation

 

 

(70,124

)

 

 

(55,196

)

 

 

(41,917

)

 

 

$

19,635,459

 

 

$

18,425,023

 

 

$

15,371,795

 


 Year Ended December 31,
 202120202019
 (In thousands)
Net revenue   
Las Vegas Strip Resorts   
Casino$1,549,419 $728,254 $1,296,170 
Rooms1,402,712 662,813 1,863,521 
Food and beverage1,015,366 471,529 1,517,745 
Entertainment, retail and other769,688 383,189 1,153,615 
 4,737,185 2,245,785 5,831,051 
Regional Operations
Casino2,721,515 1,569,193 2,537,780 
Rooms220,828 130,945 316,753 
Food and beverage307,750 184,153 494,243 
Entertainment, retail and other142,270 82,880 201,008 
 3,392,363 1,967,171 3,549,784 
MGM China
Casino1,057,962 565,671 2,609,806 
Rooms66,498 36,624 142,306 
Food and beverage68,489 40,284 127,152 
Entertainment, retail and other17,812 14,124 26,158 
 1,210,761 656,703 2,905,422 
Reportable segment net revenues9,340,309 4,869,659 12,286,257 
Corporate and other339,831 292,423 613,415 
 $9,680,140 $5,162,082 $12,899,672 
Adjusted Property EBITDAR
Las Vegas Strip Resorts$1,738,211 $232,188 $1,643,122 
Regional Operations1,217,814 343,990 969,866 
MGM China25,367 (193,832)734,729 
Reportable segment Adjusted Property EBITDAR2,981,392 382,346 3,347,717 
 
Other operating income (expense)
Corporate and other, net(560,309)(530,843)(331,621)
Preopening and start-up expenses(5,094)(84)(7,175)
Property transactions, net67,736 (93,567)(275,802)
Depreciation and amortization(1,150,610)(1,210,556)(1,304,649)
Gain on REIT transactions, net— 1,491,945 2,677,996 
Gain on consolidation of CityCenter, net1,562,329 — — 
CEO transition expense— (44,401)— 
October 1 litigation settlement— (49,000)— 
Restructuring— (26,025)(92,139)
Triple-net operating lease and ground lease rent expense(833,158)(710,683)(74,656)
Gain related to sale of Harmon land - unconsolidated affiliate49,755 — — 
Income from unconsolidated affiliates related to real estate ventures166,658 148,434 544 
Operating income (loss)2,278,699 (642,434)3,940,215 
Non-operating income (expense)
Interest expense, net of amounts capitalized(799,593)(676,380)(847,932)
Non-operating items from unconsolidated affiliates(83,243)(103,304)(62,296)
Other, net65,941 (89,361)(183,262)
 (816,895)(869,045)(1,093,490)
Income (loss) before income taxes1,461,804 (1,511,479)2,846,725 
Benefit (provision) for income taxes(253,415)191,572 (632,345)
Net income (loss)1,208,389 (1,319,907)2,214,380 
Less: Net (income) loss attributable to noncontrolling interests45,981 287,183 (165,234)
Net income (loss) attributable to MGM Resorts International$1,254,370 $(1,032,724)$2,049,146 

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures:

 

(In thousands)

 

Domestic resorts

 

$

486,611

 

 

$

317,951

 

 

$

383,367

 

MGM China

 

 

923,346

 

 

 

984,355

 

 

 

590,968

 

Reportable segment capital expenditures

 

 

1,409,957

 

 

 

1,302,306

 

 

 

974,335

 

Corporate and other

 

 

469,053

 

 

 

973,446

 

 

 

504,398

 

Eliminated in consolidation

 

 

(14,928

)

 

 

(13,279

)

 

 

(11,914

)

 

 

$

1,864,082

 

 

$

2,262,473

 

 

$

1,466,819

 



102

 Year Ended December 31,
 202120202019
Capital expenditures:(In thousands)
Las Vegas Strip Resorts$266,944 $87,511 $285,863 
Regional Operations77,406 41,456 187,489 
MGM China67,989 108,352 145,634 
Reportable segment capital expenditures412,339 237,319 618,986 
Corporate and other78,358 33,260 120,020 
 $490,697 $270,579 $739,006 

Total assets are not allocated to segments for internal reporting presentations or when determining the allocation of resources and, accordingly, are not presented.

Long-lived assets, which includes property and equipment, net, operating and finance lease right-of-use assets, net, goodwill, and other intangible assets, net, presented by geographic region in which the Company holds assets are presented below:
 December 31,
 202120202019
Long-lived assets:(In thousands)
United States$25,848,917 $21,035,992 $20,582,055 
China and all other foreign countries7,176,763 7,617,819 8,007,449 
 $33,025,680 $28,653,811 $28,589,504 

NOTE 18 — RELATED PARTY TRANSACTIONS


CityCenter


Management agreements. The Company andUntil the Company's acquisition of CityCenter have entered into agreements wherebyin September 2021, the Company is responsible forwas party to a management ofagreement pursuant to which it managed the operations of CityCenter for a fee of 2% of revenue and 5% of EBITDA (as defined)defined within the management agreement) for Aria and Vdara and $3 million per year for Crystals.Vdara. The Company earned fees of $49$29 million, $43$16 million and $41$48 million forduring the years ended December 31, 2017, 20162021, 2020, and 2015,2019, respectively. The Company is being reimbursed for certain costs in performing its development and management services. During the years ended December 31, 2017, 2016 and 2015, the Company incurred $390 million, $387 million and $393 million, respectively, of costs reimbursable by CityCenter, primarily for employee compensation and certain allocated costs.costs in performing the Company's management services, of $187 million, $212 million and $420 million during the years ended December 31, 2021, 2020, and 2019, respectively. As of December 31, 2017 and 2016,2020, CityCenter owed the Company $75$39 million and $77 million, respectively, for management services and reimbursable costs recorded in “Accounts receivable, net” inon the accompanying consolidated balance sheets.

The management agreement was terminated in connection with the Company's acquisition of CityCenter, as discussed in Note 4.


MGM China


Ms. Ho, Pansy Catilina Chiu King (“Ms. Ho”) is a memberthe Co-Chairperson of the Board of Directors of, and holds a minority ownership interest in, MGM China. Ms. Ho is also the managing director of Shun Tak Holdings Limited (together with its subsidiaries “Shun Tak”), a leading conglomerate in Hong Kong with core businesses in transportation, property, hospitality and investments. Shun Tak provides various services and products, including ferry tickets, travel products, rental of hotel rooms, laundry services advertising services and property cleaning services to MGM China. In addition, MGM China leases transportation equipment and office space from Shun Tak. MGM China incurred expenses relating to Shun Tak of $13$7 million, $10$7 million and $16 million for the years ended December 31, 2017,2021, 2020 and 2019, respectively.

In addition, Ms. Ho indirectly holds a 50% interest in an entity that provides, along with its subsidiary, marketing and public relations consulting services, including for the retendering of MGM China's gaming subconcession, to MGM China, which totaled $4 million, $1 million, and $4 million for the years ended December 31, 2021, 2020, and 2019, respectively.

Grand Paradise Macau deferred cash payment. On September 1, 2016, and 2015, respectively.

the Company purchased 188.1 million common shares of its MGM China subsidiary from Grand Paradise Macau (“GPM”), an entity controlled by Ms. Ho. As

103

part of the consideration for the purchase, the Company agreed to pay GPM or its nominee a deferred cash payment of $50 million. The payments included amounts equal to the ordinary dividends received on such shares, with a final lump sum payment due on the fifth anniversary of the closing date of the transaction, which was made in September 2021. Such amounts were paid to Expert Angels Limited, an entity controlled by an immediate family member of Ms. Ho. As of December 31, 2020, the Company recorded a remaining liability on a discounted basis of $33 million in “Other accrued liabilities” on the consolidated balance sheets.

MGM Branding and Development Holdings, Ltd. (together with its subsidiary MGM Development Services, Ltd., “MGM Branding and Development”), an entity included in the Company’s consolidated financial statements in which Ms. Ho indirectly holds a noncontrolling interest, is party to a brand license agreement and a development services agreement with MGM China, for which the related amounts are eliminated in consolidation. An entity owned by Ms. Ho received distributions of $15$8 million, during each of$5 million and $20 million for the years ended December 31, 2017, 20162021, 2020 and 20152019, respectively, in connection with the ownership of a noncontrolling interest in MGM Branding and Development Holdings, Ltd.


MGP


As further described in Note 1, pursuant to the master lease with MGP, the tenantCompany leases the real estate assets of The Mirage, Mandalay Bay, Luxor, New York-New York, Monte Carlo,Park MGM, Excalibur, The Park, Gold Strike Tunica, MGM Grand Detroit, and Beau Rivage, from the landlord. On August 1, 2016, Borgata, was added to the existing master lease and, on October 5, 2017,Empire City, MGM National Harbor, was also added to the existingMGM Northfield Park, and MGM Springfield from MGP.

MGP master lease.

The MGP master lease has an initial lease term of ten10 years beginningthat began on April 25, 2016 (other than with respect to MGM National Harbor, as described below) with the potential to extend the term for four4 additional five-year5-year terms thereafter at the option of the tenant.Company (with additional renewal options with respect to MGM Springfield, as described below). The MGP master lease provides that any extension of its term must apply to all of the real estate under the master lease at the time of the extension. The master lease has a triple-net structure, which requires the tenant to pay substantially all costs associated with the lease, including real estate taxes, insurance, utilities and routine maintenance, in addition to the base rent. Additionally, theMGP master lease provides the landlord with a right of first offer with respect to the Company’s development property located in Springfield, Massachusetts, which the landlord may exercise should the Company elect to sell this property in the future. In connection with the MGM National Harbor transaction, the master lease was amended to provide that the initial term with respect to MGM National Harbor ends on April 31, 2024. Thereafter, the initial term of the MGP master lease with respect to MGM National Harbor may be renewed at the option of the tenantCompany for an initial renewal period lasting until the earlier of the end of the then-current term of the master lease or


the next renewal term (depending on whether MGMthe Company elects to renew the other properties under the master lease in connection with the expiration of the initial ten-year10-year term). If, however, the tenantCompany chooses not to renew the lease with respect to MGM National Harbor after the initial MGM National Harbor term under the master Lease,lease, the tenantCompany would also lose the right to renew the MGP master lease with respect to the rest of the properties when the initial ten-year10-year lease term ends related to the rest of the properties in 2026.

In addition to the four 5-year renewal terms, the term of the lease with respect to MGM Springfield may be extended for an additional four 5-year renewal terms. The initial annual rent underMGP master lease has a triple-net structure, which requires the Company to pay substantially all costs associated with the lease, including real estate taxes, ground lease payments, insurance, utilities and routine maintenance, in addition to the base rent. Additionally, the master lease forprovides MGP with a right of first offer with respect to any further gaming development by the first lease year commencing April 25, 2016, was $550 million. In connection withCompany on the Borgata transaction on August 1, 2016, total annual rentundeveloped land adjacent to Empire City, which MGP may exercise should the Company elect to sell this property in the future.


Rent under the master lease increased to $650 million. In connection with the commencement of the second lease year on April 1, 2017, the total annual rent under the master lease increased to $662 million. Then, in connection with the MGM National Harbor Transaction on October 5, 2017, the total annual rent payments under the master lease for the second lease year increased to $757 million. Rent under theMGP master lease consists of a “base rent”base rent component and a “percentage rent”percentage rent component. As of December 31, 2017,2021, the base rent represents approximately 90%91% of the rent payments due and the percentage rent represents approximately 9% of the rent payments due under the master lease and the percentage rent represents approximately 10% of the rent payments due under theMGP master lease. The MGP master lease also provides for fixed annual escalators of 2% on the base rent inthrough the second through sixth yearslease year and the possibility for additional 2% increases thereafter subject to the tenant and operating subsidiary sublessee, collectively, meeting an adjusted net revenue to rent ratio, as well as potential increases in percentage rent in year six and every five years thereafter based on a percentage of average actual annual net revenue during the preceding five year period calculated in accordance with the terms under the master lease. With respect to the additional renewal terms for MGM Springfield, for the first two additional renewal terms, base rent will include a fixed annual rent escalator of 2.0%, subject to the adjusted net revenue to rent ratio, as discussed above. For each lease year subsequent to the first two additional renewal terms, the base rent shall be the Fair Market Rent (as defined in the MGP master lease) in respect of MGM Springfield. The MGP master lease also contains customary events of default and financial covenants.covenants; provided that the tenant will not be in default of the financial covenants in the event there is an unavoidable delay (as such term is defined in the lease). The Company was in compliance with all applicable covenants as of December 31, 2017.

2021.


Subsequent to the Company completing its acquisition of Empire City in January 2019, MGP acquired the developed real property associated with Empire City from the Company for consideration of approximately $634 million, which included the assumption of debt of approximately $246 million, which was immediately repaid, and the remainder in issuance of Operating Partnership units. The real estate assets of Empire City were then leased to the Company pursuant to an amendment to the MGP master lease, increasing the annual rent payment to MGP by $50 million, prorated for the remainder of the lease year. Consistent with the MGP master lease terms, 90% of this rent will be fixed and contractually
104

grow at 2% per year until 2022. As disclosed above, the master lease provides MGP with a right of first offer with respect to certain undeveloped land adjacent to the property to the extent the Company develops additional gaming facilities, which MGP may exercise should the Company elect to sell this property in the future.

On March 7, 2019, the Company entered into an amendment to the existing MGP master lease with respect to the Park MGM Transaction. In connection with the transaction, the Company received consideration of $638 million, of which approximately $606 million was paid in cash and the remainder in issuance of Operating Partnership units. Additionally, the annual rent payment to MGP was increased by $50 million, prorated for the remainder of the lease year. Consistent with the master lease terms, 90% of this rent will be fixed and contractually grow at 2% per year until 2022.

Additionally, on April 1, 2019, the Company acquired the membership interests of Northfield from MGP, which held the operations of Northfield, for fair value of consideration of approximately $305 million consisting primarily of approximately 9 million Operating Partnership units that were ultimately redeemed by the Operating Partnership, and MGP retained the associated real estate assets. The Company then rebranded the property to MGM Northfield Park, which was then added to the existing MGP master lease with MGP, increasing the annual rent payment to MGP by $60 million. Consistent with the master lease terms, 90% of this rent will be fixed and contractually grow at 2% per year until 2022.

The annual rent payments under the MGP master lease for the fourth lease year, which commenced on April 1, 2019, increased to $946 million from $770 million at the start of the third lease year. The increase was a result of the $50 million in additional rent for each of the Park MGM Transaction and the addition of Empire City in the beginning of 2019, the $60 million of additional rent for MGM Northfield Park, which entered the Master Lease on April 1, 2019, as well as the third 2% fixed annual rent escalator that went into effect on April 1, 2019.

On February 14, 2020, the Company amended the MGP master lease to remove Mandalay Bay from such master lease and the annual rent under the MGP master lease was reduced by $133 million to $813 million.

The annual cash rent payments under the MGP master lease for the fifth lease year, which commenced on April 1, 2020, increased to $828 million from $813 million, as a result of the fourth 2% fixed annual rent escalator that went into effect on April 1, 2020.

The annual cash rent payments under the MGP master lease for the sixth lease year, which commenced on April 1, 2021, increased to $843 million from $828 million, as a result of the fifth 2% fixed annual rent escalator that went into effect on April 1, 2021.

In October 2021, MGP acquired the real estate assets of MGM Springfield from the Company for $400 million of cash consideration, which was accounted for as a transaction between entities under common control. The Company adjusted the carrying value of noncontrolling interests to adjust for its share of the difference between the carrying value of the net assets transferred and the consideration received, with offsetting adjustments to capital in excess of par value. MGM Springfield was added to the master lease between the Company and MGP. Following the closing of the transaction, the annual rent payment to MGP increased from $843 million to $873 million, reflecting the addition of MGM Springfield, which increased the annual rent payment by $30 million, $27 million of which will be fixed and contractually grow at 2% per year with escalators subject to the adjusted net revenue to rent ratio, as further described above. Final regulatory approvals, which were not necessary for the transaction to close, are expected to be received within nine to twelve months following the close of the transaction. Until final regulatory approvals are obtained, the parties will be subject to a trust agreement, which provides for the property to go into a trust (or, at the Company’s option, be returned to the Company) during the interim period in the event that the regulator finds reasonable cause to believe that MGP may not be found suitable. The property will then remain in trust until a final determination regarding MGP’s suitability is made.

Additionally, refer to Note 1 for discussion relating to the waiver agreement with MGP and the Operating Partnership units redeemed in 2020 thereunder.

All intercompany transactions, including transactions under the MGP master lease, have been eliminated in the Company’s consolidation of MGP. The public ownership of MGP’s Class A shares is recognized as non-controllingnoncontrolling interests in the Company’s consolidated financial statements.

NOTE 19 —CONDENSED CONSOLIDATING


As further described in Note 1, in August 2021, the Company entered into an agreement with VICI and MGP whereby VICI will acquire MGP in a stock-for-stock transaction. As part of the transaction, the Company will enter into an amended and restated master lease with VICI. The transaction is expected to close in the first half of 2022, subject to customary closing conditions, regulatory approvals, and approval by VICI stockholders (which was obtained on October 29, 2021).

105

Bellagio BREIT Venture

The Company has a 5% ownership interest in Bellagio BREIT Venture, which owns the real estate assets of Bellagio and leases such assets to a subsidiary of the Company pursuant to a lease agreement. Refer to Note 11 for further information related to the Bellagio lease.

MGP BREIT Venture

MGP has a 50.1% ownership interest in MGP BREIT Venture, which owns the real estate assets of Mandalay Bay and MGM Grand Las Vegas and leases such assets to a subsidiary of the Company pursuant to a lease agreement. Refer to Note 11 for further information related to the Mandalay Bay and MGM Grand Las Vegas lease.





106

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS
(In thousands)

 Balance at Beginning of PeriodExpected Credit LossesWrite-offs, Net of RecoveriesBalance at End of Period
Loss reserve:    
Year Ended December 31, 2021$126,589 $21,852 $(20,093)$128,348 
Year Ended December 31, 202094,561 71,422 (39,394)126,589 
Year Ended December 31, 201990,775 39,270 (35,484)94,561 

 Balance at Beginning of PeriodIncreaseDecreaseBalance at End of Period
Deferred income tax valuation allowance:    
Year Ended December 31, 2021$2,875,595 $8,667 $— $2,884,262 
Year Ended December 31, 20202,574,056 301,539 — 2,875,595 
Year Ended December 31, 20192,477,703 96,353 — 2,574,056 


107

ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL INFORMATION

AsDISCLOSURE


None.

ITEM 9A.    CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer) have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“the Exchange Act”)) were effective as of December 31, 2017,2021 to provide reasonable assurance that information required to be disclosed in the Company’s reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and regulations and to provide that such information is accumulated and communicated to management to allow timely decisions regarding required disclosures. This conclusion is based on an evaluation as required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act conducted under the supervision and participation of the principal executive officer and principal financial officer along with company management.

Changes in Internal Control over Financial Reporting

During the quarter ended December 31, 2021, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Management’s Annual Report on Internal Control over Financial Reporting

Management’s Responsibilities

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Sections 13a-15(f) and 15d-15(f) of the Exchange Act) for MGM Resorts International and subsidiaries (the “Company”).

Objective of Internal Control over Financial Reporting

In establishing adequate internal control over financial reporting, management has developed and maintained a system of internal control, policies and procedures designed to provide reasonable assurance that information contained in the accompanying consolidated financial statements and other information presented in this annual report is reliable, does not contain any untrue statement of a material fact or omit to state a material fact, and fairly presents in all material respects the financial condition, results of operations and cash flows of the Company as of and for the periods presented in this annual report. These include controls and procedures designed to ensure that this information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate for all timely decisions regarding required disclosure. Significant elements of the Company’s internal control over financial reporting include, for example:

•Hiring skilled accounting personnel and training them appropriately;
•Written accounting policies;
•Written documentation of accounting systems and procedures;
•Segregation of incompatible duties;
•Internal audit function to monitor the effectiveness of the system of internal control; and
•Oversight by an independent Audit Committee of the Board of Directors.

Management’s Evaluation

Management, with the participation of the Company’s principal debt arrangements are guaranteed by each of its material domestic subsidiaries, other than MGPexecutive officer and the Operating Partnership, MGM Grand Detroit, LLC, MGM National Harbor, LLC and Blue Tarp reDevelopment, LLC (the company that will own and operateprincipal financial officer, has evaluated the Company’s casinointernal control over financial reporting using the criteria established in Springfield, Massachusetts), and eachInternal Control—Integrated Framework (2013) issued by the Committee of their respective subsidiaries. The Company’s international subsidiaries, including MGM China andSponsoring Organizations of the Treadway Commission.

Based on its subsidiaries, are not guarantors of such indebtedness. Separate condensed financial statement information for the subsidiary guarantors and non-guarantorsevaluation as of December 31, 20172021, management believes that the Company’s internal control over financial reporting is effective in achieving the objectives described above.

108

The Company’s independent registered public accounting firm’s report on the effectiveness of our internal control over financial reporting appears herein.

ITEM 9B.    OTHER INFORMATION

None.

ITEM 9C.    DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.
109

PART III


ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

We incorporate by reference the information appearing under “Information about our Executive Officers” in Item 1 of this Form 10-K and 2016under “Election of Directors” and “Corporate Governance” in our definitive Proxy Statement for our 2022 Annual Meeting of Stockholders, which we expect to file with the years endedSEC within 120 days after December 31, 2017, 20162021 (the “Proxy Statement”).

ITEM 11.    EXECUTIVE COMPENSATION

We incorporate by reference the information appearing under “Director Compensation” and 2015, are presented below. Within“Executive Compensation” and “Corporate Governance — Human Capital and Compensation Committee Interlocks and Insider Participation” and “Human Capital and Compensation Committee Report” in the Condensed Consolidating StatementsProxy Statement.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

We incorporate by reference the information appearing under “Principal Stockholders” and “Election of Cash Flows,Directors” in the Proxy Statement.

Equity Compensation Plan Information

The following table includes information about our equity compensation plans at December 31, 2021:

 Securities to be issued upon exercise of outstanding options, warrants and rightsWeighted average exercise price of outstanding options, warrants and rightsSecurities available for future issuance under equity compensation plans
 (In thousands, except per share data)
Equity compensation plans approved by security holders (1)
6,539$24.33 20,080
Equity compensation plans not approved by security holders———

(1)As of December 31, 2021, we had 4.0 million restricted stock units and 1.7 million performance share units outstanding that do not have an exercise price; therefore, the weighted average per share exercise price only relates to outstanding stock appreciation rights. The amount included in the securities outstanding above for performance share units assumes that each target price is achieved.

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORS, INDEPENDENCE

We incorporate by reference the information appearing under “Transactions with Related Persons” and “Corporate Governance” in the Proxy Statement.

ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES

We incorporate by reference the information appearing under “Ratification of Selection of Independent Registered Public Accounting Firm” in the Proxy Statement.
110

PART IV

ITEM 15.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a)(1).    Financial Statements. The following consolidated financial statements of the Company has presented net changes in intercompany accountsare filed as investing activities if the applicable entities have a net asset in intercompany accountspart of this report under Item 8 – “Financial Statements and as a financing activity if the applicable entities have a net intercompany liability balance.

CertainSupplementary Data.”


59
62
Years Ended December 31, 2021, 2020 and 2019
Consolidated Statements of Operations
63
Consolidated Statements of Comprehensive Income (Loss)
64
Consolidated Statements of Cash Flows
65
Consolidated Statements of Stockholders’ Equity
66
67

(a)(2).    Financial Statement Schedule. The following financial statement schedule of the Company’s subsidiaries collectively own 73.4%Company is filed as part of the Operating Partnership units as of December 31, 2017,this report under Item 8 – “Financial Statements and each subsidiary accounts for its respective investment under the equity method within the condensed consolidatingSupplementary Data.”
Years Ended December 31, 2021, 2020 and 2019
107

The financial information presented below. For these subsidiaries, such investment constitutes continuing involvement, and accordingly,included in the contribution and leaseback of the real estate assets do not qualify for sale-leaseback accounting. The real estate assets that were contributed to and owned by the Operating Partnershipfinancial statement schedule should be read in connectionconjunction with the IPO, along withconsolidated financial statements. All other financial statement schedules have been omitted because they are not applicable, or the related transactions, are reflectedrequired information is included in the balance sheets of the MGM subsidiaries that contributed such assets. In addition, such subsidiaries recognized finance liabilities within “Other long-term obligations” related to rent payments due under the master lease and recognized the related interest expense component of such payments. These real estate assets are also reflected on the balance sheet of the MGP subsidiary that received such assets in connection with the contribution. The condensed consolidatingconsolidated financial information presented below therefore includes the accounting for such activity within the respective columns presented and in the elimination column. For all periods prior to the commencement of the master lease arrangement, the condensed consolidating financial information set forth herein has been retrospectively adjusted to conform prior periods to the current presentation, as the transactions occurred between entities, which are considered businesses under common control. Accordingly, the real estate assets and associated operations in all periods prior to the IPO date were reclassified to conform to the current organizational structure, and are reflected in the MGP subsidiary that currently has legal title to such assets.


CONDENSED CONSOLIDATING BALANCE SHEET INFORMATION

 

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Current assets

 

$

78,909

 

 

$

1,014,074

 

 

$

266,627

 

 

$

1,022,340

 

 

$

(7,323

)

 

$

2,374,627

 

Property and equipment, net

 

 

—

 

 

 

13,521,221

 

 

 

10,021,938

 

 

 

6,125,722

 

 

 

(10,033,422

)

 

 

19,635,459

 

Investments in subsidiaries

 

 

21,085,194

 

 

 

3,318,836

 

 

 

—

 

 

 

—

 

 

 

(24,404,030

)

 

 

—

 

Investments in the MGP Operating Partnership

 

 

—

 

 

 

3,549,063

 

 

 

—

 

 

 

862,037

 

 

 

(4,411,100

)

 

 

—

 

Investments in and advances to unconsolidated affiliates

 

 

—

 

 

 

1,003,767

 

 

 

—

 

 

 

5,394

 

 

 

25,000

 

 

 

1,034,161

 

Intercompany accounts

 

 

—

 

 

 

5,983,656

 

 

 

—

 

 

 

—

 

 

 

(5,983,656

)

 

 

—

 

Other non-current assets

 

 

49,142

 

 

 

913,602

 

 

 

62,555

 

 

 

5,134,220

 

 

 

(44,588

)

 

 

6,114,931

 

 

 

$

21,213,245

 

 

$

29,304,219

 

 

$

10,351,120

 

 

$

13,149,713

 

 

$

(44,859,119

)

 

$

29,159,178

 

Current liabilities

 

$

153,159

 

 

$

1,399,120

 

 

$

144,537

 

 

$

1,609,106

 

 

$

(213,540

)

 

$

3,092,382

 

Intercompany accounts

 

 

5,783,579

 

 

 

—

 

 

 

962

 

 

 

199,115

 

 

 

(5,983,656

)

 

 

—

 

Deferred income taxes, net

 

 

944,424

 

 

 

—

 

 

 

28,544

 

 

 

360,411

 

 

 

(28,544

)

 

 

1,304,835

 

Long-term debt, net

 

 

6,682,571

 

 

 

2,835

 

 

 

3,934,628

 

 

 

2,131,018

 

 

 

—

 

 

 

12,751,052

 

Other long-term obligations

 

 

36,860

 

 

 

7,268,664

 

 

 

174,710

 

 

 

2,305,353

 

 

 

(9,501,171

)

 

 

284,416

 

Total liabilities

 

 

13,600,593

 

 

 

8,670,619

 

 

 

4,283,381

 

 

 

6,605,003

 

 

 

(15,726,911

)

 

 

17,432,685

 

Redeemable noncontrolling interests

 

 

—

 

 

 

—

 

 

 

—

 

 

 

79,778

 

 

 

—

 

 

 

79,778

 

MGM Resorts International stockholders' equity

 

 

7,612,652

 

 

 

20,633,600

 

 

 

4,443,089

 

 

 

4,055,519

 

 

 

(29,132,208

)

 

 

7,612,652

 

Noncontrolling interests

 

 

—

 

 

 

—

 

 

 

1,624,650

 

 

 

2,409,413

 

 

 

—

 

 

 

4,034,063

 

Total stockholders' equity

 

 

7,612,652

 

 

 

20,633,600

 

 

 

6,067,739

 

 

 

6,464,932

 

 

 

(29,132,208

)

 

 

11,646,715

 

 

 

$

21,213,245

 

 

$

29,304,219

 

 

$

10,351,120

 

 

$

13,149,713

 

 

$

(44,859,119

)

 

$

29,159,178

 

 

 

December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Current assets

 

$

103,934

 

 

$

981,705

 

 

$

368,622

 

 

$

783,920

 

 

$

(8,594

)

 

$

2,229,587

 

Property and equipment, net

 

 

—

 

 

 

13,599,127

 

 

 

9,079,678

 

 

 

4,837,868

 

 

 

(9,091,650

)

 

 

18,425,023

 

Investments in subsidiaries

 

 

18,907,988

 

 

 

3,338,752

 

 

 

—

 

 

 

—

 

 

 

(22,246,740

)

 

 

—

 

Investments in the MGP Operating Partnership

 

 

—

 

 

 

3,553,840

 

 

 

—

 

 

 

636,268

 

 

 

(4,190,108

)

 

 

—

 

Investments in and advances to unconsolidated affiliates

 

 

—

 

 

 

1,189,590

 

 

 

—

 

 

 

5,853

 

 

 

25,000

 

 

 

1,220,443

 

Intercompany accounts

 

 

—

 

 

 

4,796,713

 

 

 

—

 

 

 

—

 

 

 

(4,796,713

)

 

 

—

 

Other non-current assets

 

 

50,741

 

 

 

934,836

 

 

 

58,440

 

 

 

5,302,132

 

 

 

(47,901

)

 

 

6,298,248

 

 

 

$

19,062,663

 

 

$

28,394,563

 

 

$

9,506,740

 

 

$

11,566,041

 

 

$

(40,356,706

)

 

$

28,173,301

 

Current liabilities

 

$

184,281

 

 

$

1,301,423

 

 

$

139,099

 

 

$

837,844

 

 

$

(169,226

)

 

$

2,293,421

 

Intercompany accounts

 

 

3,406,699

 

 

 

—

 

 

 

166

 

 

 

1,389,848

 

 

 

(4,796,713

)

 

 

—

 

Deferred income taxes, net

 

 

2,202,809

 

 

 

—

 

 

 

25,368

 

 

 

348,419

 

 

 

(25,368

)

 

 

2,551,228

 

Long-term debt, net

 

 

7,019,745

 

 

 

2,835

 

 

 

3,613,567

 

 

 

2,343,073

 

 

 

—

 

 

 

12,979,220

 

Other long-term obligations

 

 

28,949

 

 

 

7,360,887

 

 

 

120,279

 

 

 

1,051,754

 

 

 

(8,235,888

)

 

 

325,981

 

Total liabilities

 

 

12,842,483

 

 

 

8,665,145

 

 

 

3,898,479

 

 

 

5,970,938

 

 

 

(13,227,195

)

 

 

18,149,850

 

Redeemable noncontrolling interests

 

 

—

 

 

 

—

 

 

 

—

 

 

 

54,139

 

 

 

—

 

 

 

54,139

 

MGM Resorts International stockholders' equity

 

 

6,220,180

 

 

 

19,729,418

 

 

 

4,274,444

 

 

 

3,125,649

 

 

 

(27,129,511

)

 

 

6,220,180

 

Noncontrolling interests

 

 

—

 

 

 

—

 

 

 

1,333,817

 

 

 

2,415,315

 

 

 

—

 

 

 

3,749,132

 

Total stockholders' equity

 

 

6,220,180

 

 

 

19,729,418

 

 

 

5,608,261

 

 

 

5,540,964

 

 

 

(27,129,511

)

 

 

9,969,312

 

 

 

$

19,062,663

 

 

$

28,394,563

 

 

$

9,506,740

 

 

$

11,566,041

 

 

$

(40,356,706

)

 

$

28,173,301

 


CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME INFORMATION

 

 

Year Ended December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Net revenues

 

$

—

 

 

$

7,516,836

 

 

$

765,695

 

 

$

3,260,883

 

 

$

(769,510

)

 

$

10,773,904

 

Equity in subsidiaries' earnings

 

 

1,394,690

 

 

 

157,348

 

 

 

—

 

 

 

—

 

 

 

(1,552,038

)

 

 

—

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Casino and hotel operations

 

 

10,784

 

 

 

4,127,270

 

 

 

—

 

 

 

2,031,768

 

 

 

(3,816

)

 

 

6,166,006

 

General and administrative

 

 

8,742

 

 

 

1,181,329

 

 

 

84,348

 

 

 

369,844

 

 

 

(84,348

)

 

 

1,559,915

 

Corporate expense

 

 

127,092

 

 

 

200,804

 

 

 

34,085

 

 

 

(515

)

 

 

(4,591

)

 

 

356,875

 

NV Energy exit expense

 

 

—

 

 

 

(40,629

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(40,629

)

Preopening and start-up expenses

 

 

—

 

 

 

8,258

 

 

 

—

 

 

 

110,217

 

 

 

—

 

 

 

118,475

 

Property transactions, net

 

 

—

 

 

 

43,985

 

 

 

34,022

 

 

 

6,294

 

 

 

(34,022

)

 

 

50,279

 

Depreciation and amortization

 

 

—

 

 

 

649,676

 

 

 

260,455

 

 

 

343,804

 

 

 

(260,455

)

 

 

993,480

 

 

 

 

146,618

 

 

 

6,170,693

 

 

 

412,910

 

 

 

2,861,412

 

 

 

(387,232

)

 

 

9,204,401

 

Income (loss) from unconsolidated affiliates

 

 

—

 

 

 

147,001

 

 

 

—

 

 

 

(1,012

)

 

 

—

 

 

 

145,989

 

Operating income

 

 

1,248,072

 

 

 

1,650,492

 

 

 

352,785

 

 

 

398,459

 

 

 

(1,934,316

)

 

 

1,715,492

 

Interest expense, net of amounts capitalized

 

 

(466,907

)

 

 

(982

)

 

 

(184,175

)

 

 

(16,681

)

 

 

—

 

 

 

(668,745

)

Other, net

 

 

26,215

 

 

 

(402,602

)

 

 

2,286

 

 

 

(142,997

)

 

 

434,106

 

 

 

(82,992

)

Income before income taxes

 

 

807,380

 

 

 

1,246,908

 

 

 

170,896

 

 

 

238,781

 

 

 

(1,500,210

)

 

 

963,755

 

Benefit (provision) for income taxes

 

 

1,152,906

 

 

 

—

 

 

 

(4,906

)

 

 

(15,337

)

 

 

—

 

 

 

1,132,663

 

Net income

 

 

1,960,286

 

 

 

1,246,908

 

 

 

165,990

 

 

 

223,444

 

 

 

(1,500,210

)

 

 

2,096,418

 

Less: Net income attributable to noncontrolling interests

 

 

—

 

 

 

—

 

 

 

(41,775

)

 

 

(94,357

)

 

 

—

 

 

 

(136,132

)

Net income attributable to MGM Resorts International

 

$

1,960,286

 

 

$

1,246,908

 

 

$

124,215

 

 

$

129,087

 

 

$

(1,500,210

)

 

$

1,960,286

 

Net income

 

$

1,960,286

 

 

$

1,246,908

 

 

$

165,990

 

 

$

223,444

 

 

$

(1,500,210

)

 

$

2,096,418

 

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(23,995

)

 

 

(23,995

)

 

 

—

 

 

 

(43,188

)

 

 

47,990

 

 

 

(43,188

)

Unrealized gain on cash flow hedges

 

 

5,234

 

 

 

—

 

 

 

9,782

 

 

 

—

 

 

 

(7,021

)

 

 

7,995

 

Other comprehensive income (loss)

 

 

(18,761

)

 

 

(23,995

)

 

 

9,782

 

 

 

(43,188

)

 

 

40,969

 

 

 

(35,193

)

Comprehensive income

 

 

1,941,525

 

 

 

1,222,913

 

 

 

175,772

 

 

 

180,256

 

 

 

(1,459,241

)

 

 

2,061,225

 

Less: Comprehensive income attributable to noncontrolling interests

 

 

—

 

 

 

—

 

 

 

(44,536

)

 

 

(75,164

)

 

 

—

 

 

 

(119,700

)

Comprehensive income attributable to MGM Resorts International

 

$

1,941,525

 

 

$

1,222,913

 

 

$

131,236

 

 

$

105,092

 

 

$

(1,459,241

)

 

$

1,941,525

 


CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS INFORMATION

 

 

Year Ended December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Cash flows from operating activities

 

 

 

Net cash provided by (used in) operating activities

 

$

(584,251

)

 

$

1,150,814

 

 

$

482,578

 

 

$

1,157,270

 

 

$

—

 

 

$

2,206,411

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures, net of construction payable

 

 

—

 

 

 

(482,024

)

 

 

(488

)

 

 

(1,381,570

)

 

 

—

 

 

 

(1,864,082

)

Dispositions of property and equipment

 

 

—

 

 

 

502

 

 

 

—

 

 

 

216

 

 

 

—

 

 

 

718

 

Acquisition of National Harbor, net of cash acquired

 

 

—

 

 

 

—

 

 

 

(462,500

)

 

 

—

 

 

 

462,500

 

 

 

—

 

Investments in and advances to unconsolidated affiliates

 

 

—

 

 

 

(16,727

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(16,727

)

Distributions from unconsolidated affiliates in excess of cumulative earnings

 

 

—

 

 

 

301,211

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

301,211

 

Intercompany accounts

 

 

462,500

 

 

 

(1,186,942

)

 

 

—

 

 

 

—

 

 

 

724,442

 

 

 

—

 

Other

 

 

—

 

 

 

(1,754

)

 

 

—

 

 

 

42

 

 

 

—

 

 

 

(1,712

)

Net cash provided by (used in) investing activities

 

 

462,500

 

 

 

(1,385,734

)

 

 

(462,988

)

 

 

(1,381,312

)

 

 

1,186,942

 

 

 

(1,580,592

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net borrowings (repayments) under bank credit facilities - maturities of 90 days or less

 

 

122,500

 

 

 

—

 

 

 

(466,875

)

 

 

359,376

 

 

 

—

 

 

 

15,001

 

Issuance of long-term debt

 

 

—

 

 

 

—

 

 

 

350,000

 

 

 

—

 

 

 

—

 

 

 

350,000

 

Retirement of senior notes

 

 

(502,669

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(502,669

)

Debt issuance costs

 

 

—

 

 

 

—

 

 

 

(5,598

)

 

 

(4,379

)

 

 

—

 

 

 

(9,977

)

Issuance of MGM Growth Properties Class A shares in public offering

 

 

—

 

 

 

—

 

 

 

404,685

 

 

 

—

 

 

 

—

 

 

 

404,685

 

MGM Growth Properties Class A share issuance costs

 

 

—

 

 

 

—

 

 

 

(17,137

)

 

 

—

 

 

 

—

 

 

 

(17,137

)

Dividends paid to common shareholders

 

 

(252,014

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(252,014

)

MGP dividends paid to consolidated subsidiaries

 

 

—

 

 

 

—

 

 

 

(290,091

)

 

 

—

 

 

 

290,091

 

 

 

—

 

Distributions to noncontrolling interest owners

 

 

—

 

 

 

—

 

 

 

(95,344

)

 

 

(75,058

)

 

 

—

 

 

 

(170,402

)

Intercompany accounts

 

 

1,042,111

 

 

 

249,893

 

 

 

—

 

 

 

185,029

 

 

 

(1,477,033

)

 

 

—

 

Purchases of common stock

 

 

(327,500

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(327,500

)

Other

 

 

(33,802

)

 

 

(11,643

)

 

 

—

 

 

 

(13,320

)

 

 

—

 

 

 

(58,765

)

Net cash provided by (used in) financing activities

 

 

48,626

 

 

 

238,250

 

 

 

(120,360

)

 

 

451,648

 

 

 

(1,186,942

)

 

 

(568,778

)

Effect of exchange rate on cash

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(3,627

)

 

 

—

 

 

 

(3,627

)

Cash and cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) for the period

 

 

(73,125

)

 

 

3,330

 

 

 

(100,770

)

 

 

223,979

 

 

 

—

 

 

 

53,414

 

Balance, beginning of period

 

 

99,995

 

 

 

307,713

 

 

 

360,492

 

 

 

678,381

 

 

 

—

 

 

 

1,446,581

 

Balance, end of period

 

$

26,870

 

 

$

311,043

 

 

$

259,722

 

 

$

902,360

 

 

$

—

 

 

$

1,499,995

 


CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME INFORMATION

 

 

Year Ended December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Net revenues

 

$

—

 

 

$

6,918,748

 

 

$

467,548

 

 

$

2,539,794

 

 

$

(470,967

)

 

$

9,455,123

 

Equity in subsidiaries' earnings

 

 

1,780,707

 

 

 

175,729

 

 

 

—

 

 

 

—

 

 

 

(1,956,436

)

 

 

—

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Casino and hotel operations

 

 

9,063

 

 

 

3,894,478

 

 

 

—

 

 

 

1,595,542

 

 

 

(3,419

)

 

 

5,495,664

 

General and administrative

 

 

6,834

 

 

 

1,137,110

 

 

 

68,063

 

 

 

214,839

 

 

 

(48,229

)

 

 

1,378,617

 

Corporate expense

 

 

131,938

 

 

 

160,956

 

 

 

20,360

 

 

 

(194

)

 

 

(286

)

 

 

312,774

 

NV Energy exit expense

 

 

—

 

 

 

139,335

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

139,335

 

Preopening and start-up expenses

 

 

—

 

 

 

8,775

 

 

 

—

 

 

 

131,300

 

 

 

—

 

 

 

140,075

 

Property transactions, net

 

 

—

 

 

 

16,449

 

 

 

4,684

 

 

 

(246

)

 

 

(3,809

)

 

 

17,078

 

Gain on Borgata transaction

 

 

—

 

 

 

(430,118

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(430,118

)

Depreciation and amortization

 

 

—

 

 

 

524,123

 

 

 

220,667

 

 

 

261,730

 

 

 

(156,993

)

 

 

849,527

 

 

 

 

147,835

 

 

 

5,451,108

 

 

 

313,774

 

 

 

2,202,971

 

 

 

(212,736

)

 

 

7,902,952

 

Income (loss) from unconsolidated affiliates

 

 

—

 

 

 

527,934

 

 

 

—

 

 

 

(318

)

 

 

—

 

 

 

527,616

 

Operating income

 

 

1,632,872

 

 

 

2,171,303

 

 

 

153,774

 

 

 

336,505

 

 

 

(2,214,667

)

 

 

2,079,787

 

Interest expense, net of amounts capitalized

 

 

(562,536

)

 

 

(1,500

)

 

 

(115,438

)

 

 

(15,299

)

 

 

—

 

 

 

(694,773

)

Other, net

 

 

(7,864

)

 

 

(324,141

)

 

 

(726

)

 

 

(93,145

)

 

 

300,039

 

 

 

(125,837

)

Income before income taxes

 

 

1,062,472

 

 

 

1,845,662

 

 

 

37,610

 

 

 

228,061

 

 

 

(1,914,628

)

 

 

1,259,177

 

Benefit (provision) for income taxes

 

 

38,968

 

 

 

(22,579

)

 

 

(2,264

)

 

 

(36,424

)

 

 

—

 

 

 

(22,299

)

Net income

 

 

1,101,440

 

 

 

1,823,083

 

 

 

35,346

 

 

 

191,637

 

 

 

(1,914,628

)

 

 

1,236,878

 

Less: Net income attributable to noncontrolling interests

 

 

—

 

 

 

—

 

 

 

(29,938

)

 

 

(105,500

)

 

 

—

 

 

 

(135,438

)

Net income attributable to MGM Resorts International

 

$

1,101,440

 

 

$

1,823,083

 

 

$

5,408

 

 

$

86,137

 

 

$

(1,914,628

)

 

$

1,101,440

 

Net income

 

$

1,101,440

 

 

$

1,823,083

 

 

$

35,346

 

 

$

191,637

 

 

$

(1,914,628

)

 

$

1,236,878

 

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(1,477

)

 

 

(1,477

)

 

 

—

 

 

 

(2,680

)

 

 

2,954

 

 

 

(2,680

)

Unrealized gain on cash flow hedges

 

 

1,434

 

 

 

—

 

 

 

1,879

 

 

 

—

 

 

 

(1,434

)

 

 

1,879

 

Other comprehensive income (loss)

 

 

(43

)

 

 

(1,477

)

 

 

1,879

 

 

 

(2,680

)

 

 

1,520

 

 

 

(801

)

Comprehensive income

 

 

1,101,397

 

 

 

1,821,606

 

 

 

37,225

 

 

 

188,957

 

 

 

(1,913,108

)

 

 

1,236,077

 

Less: Comprehensive income attributable to noncontrolling interests

 

 

—

 

 

 

—

 

 

 

(30,383

)

 

 

(104,297

)

 

 

—

 

 

 

(134,680

)

Comprehensive income attributable to MGM Resorts International

 

$

1,101,397

 

 

$

1,821,606

 

 

$

6,842

 

 

$

84,660

 

 

$

(1,913,108

)

 

$

1,101,397

 


CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS INFORMATION

 

 

Year Ended December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Cash flows from operating activities

 

 

 

Net cash provided by (used in) operating activities

 

$

(603,136

)

 

$

1,312,165

 

 

$

297,781

 

 

$

527,162

 

 

$

—

 

 

$

1,533,972

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures, net of construction payable

 

 

—

 

 

 

(290,455

)

 

 

(138,987

)

 

 

(1,833,031

)

 

 

—

 

 

 

(2,262,473

)

Dispositions of property and equipment

 

 

—

 

 

 

1,940

 

 

 

—

 

 

 

2,004

 

 

 

—

 

 

 

3,944

 

Proceeds from partial disposition of investment in unconsolidated affiliates

 

 

—

 

 

 

15,000

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

15,000

 

Acquisition of Borgata, net of cash acquired

 

 

—

 

 

 

(559,443

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(559,443

)

Investments in and advances to unconsolidated affiliates

 

 

—

 

 

 

(3,633

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(3,633

)

Distributions from unconsolidated affiliates in excess of cumulative earnings

 

 

—

 

 

 

542,097

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

542,097

 

Intercompany accounts

 

 

—

 

 

 

(1,562,442

)

 

 

—

 

 

 

—

 

 

 

1,562,442

 

 

 

—

 

Other

 

 

—

 

 

 

(7,651

)

 

 

—

 

 

 

(4,045

)

 

 

—

 

 

 

(11,696

)

Net cash used in investing activities

 

 

—

 

 

 

(1,864,587

)

 

 

(138,987

)

 

 

(1,835,072

)

 

 

1,562,442

 

 

 

(2,276,204

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net borrowings (repayments) under bank credit facilities - maturities of 90 days or less

 

 

(2,016,000

)

 

 

4,094,850

 

 

 

(2,411,600

)

 

 

823,782

 

 

 

—

 

 

 

491,032

 

Borrowings under bank credit facilities - maturities longer than 90 days

 

 

1,845,375

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,845,375

 

Repayments under bank credit facilities - maturities longer than 90 days

 

 

(1,845,375

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(1,845,375

)

Issuance of long-term debt

 

 

500,000

 

 

 

—

 

 

 

1,550,000

 

 

 

—

 

 

 

—

 

 

 

2,050,000

 

Retirement of senior notes

 

 

(2,255,392

)

 

 

(2,661

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2,258,053

)

Repayment of Borgata credit facility

 

 

—

 

 

 

(583,598

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(583,598

)

Debt issuance costs

 

 

(29,871

)

 

 

—

 

 

 

(77,163

)

 

 

(32,550

)

 

 

—

 

 

 

(139,584

)

Issuance of MGM Growth Properties Class A shares in public offering

 

 

—

 

 

 

—

 

 

 

1,207,500

 

 

 

—

 

 

 

—

 

 

 

1,207,500

 

MGM Growth Properties Class A share issuance costs

 

 

—

 

 

 

—

 

 

 

(75,032

)

 

 

—

 

 

 

—

 

 

 

(75,032

)

Acquisition of MGM China shares

 

 

(100,000

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(100,000

)

MGP dividends paid to consolidated subsidiaries

 

 

—

 

 

 

—

 

 

 

(113,414

)

 

 

—

 

 

 

113,414

 

 

 

—

 

Distributions to noncontrolling interest owners

 

 

—

 

 

 

—

 

 

 

(37,415

)

 

 

(65,952

)

 

 

—

 

 

 

(103,367

)

Intercompany accounts

 

 

4,082,303

 

 

 

(2,952,624

)

 

 

158,822

 

 

 

387,355

 

 

 

(1,675,856

)

 

 

—

 

Proceeds from issuance of redeemable noncontrolling interests

 

 

—

 

 

 

—

 

 

 

—

 

 

 

47,325

 

 

 

—

 

 

 

47,325

 

Other

 

 

(16,765

)

 

 

—

 

 

 

—

 

 

 

(36

)

 

 

—

 

 

 

(16,801

)

Net cash provided by financing activities

 

 

164,275

 

 

 

555,967

 

 

 

201,698

 

 

 

1,159,924

 

 

 

(1,562,442

)

 

 

519,422

 

Effect of exchange rate on cash

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(921

)

 

 

—

 

 

 

(921

)

Cash and cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) for the period

 

 

(438,861

)

 

 

3,545

 

 

 

360,492

 

 

 

(148,907

)

 

 

—

 

 

 

(223,731

)

Balance, beginning of period

 

 

538,856

 

 

 

304,168

 

 

 

—

 

 

 

827,288

 

 

 

—

 

 

 

1,670,312

 

Balance, end of period

 

$

99,995

 

 

$

307,713

 

 

$

360,492

 

 

$

678,381

 

 

$

—

 

 

$

1,446,581

 


CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME INFORMATION

 

 

Year Ended December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Net revenues

 

$

—

 

 

$

6,429,103

 

 

$

—

 

 

$

2,763,862

 

 

$

(2,897

)

 

$

9,190,068

 

Equity in subsidiaries' earnings

 

 

376,074

 

 

 

(566,270

)

 

 

—

 

 

 

—

 

 

 

190,196

 

 

 

—

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Casino and hotel operations

 

 

6,717

 

 

 

3,807,569

 

 

 

—

 

 

 

1,813,987

 

 

 

(2,897

)

 

 

5,625,376

 

General and administrative

 

 

4,959

 

 

 

1,038,053

 

 

 

58,473

 

 

 

207,619

 

 

 

—

 

 

 

1,309,104

 

Corporate expense

 

 

120,615

 

 

 

154,424

 

 

 

—

 

 

 

(488

)

 

 

—

 

 

 

274,551

 

Preopening and start-up expenses

 

 

—

 

 

 

4,973

 

 

 

—

 

 

 

66,354

 

 

 

—

 

 

 

71,327

 

Property transactions, net

 

 

—

 

 

 

24,688

 

 

 

6,665

 

 

 

1,472,589

 

 

 

—

 

 

 

1,503,942

 

Depreciation and amortization

 

 

—

 

 

 

348,159

 

 

 

196,816

 

 

 

274,908

 

 

 

—

 

 

 

819,883

 

 

 

 

132,291

 

 

 

5,377,866

 

 

 

261,954

 

 

 

3,834,969

 

 

 

(2,897

)

 

 

9,604,183

 

Income (loss) from unconsolidated affiliates

 

 

—

 

 

 

259,002

 

 

 

—

 

 

 

(1,119

)

 

 

—

 

 

 

257,883

 

Operating income (loss)

 

 

243,783

 

 

 

743,969

 

 

 

(261,954

)

 

 

(1,072,226

)

 

 

190,196

 

 

 

(156,232

)

Interest expense, net of amounts capitalized

 

 

(762,529

)

 

 

(1,057

)

 

 

—

 

 

 

(33,993

)

 

 

—

 

 

 

(797,579

)

Other, net

 

 

49,497

 

 

 

(84,958

)

 

 

—

 

 

 

(56,971

)

 

 

—

 

 

 

(92,432

)

Income (loss) before income taxes

 

 

(469,249

)

 

 

657,954

 

 

 

(261,954

)

 

 

(1,163,190

)

 

 

190,196

 

 

 

(1,046,243

)

Benefit (provision) for income taxes

 

 

21,529

 

 

 

(7,125

)

 

 

—

 

 

 

(7,810

)

 

 

—

 

 

 

6,594

 

Net income (loss)

 

 

(447,720

)

 

 

650,829

 

 

 

(261,954

)

 

 

(1,171,000

)

 

 

190,196

 

 

 

(1,039,649

)

Less: Net loss attributable to noncontrolling interests

 

 

—

 

 

 

—

 

 

 

—

 

 

 

591,929

 

 

 

—

 

 

 

591,929

 

Net income (loss) attributable to MGM Resorts International

 

$

(447,720

)

 

$

650,829

 

 

$

(261,954

)

 

$

(579,071

)

 

$

190,196

 

 

$

(447,720

)

Net income (loss)

 

$

(447,720

)

 

$

650,829

 

 

$

(261,954

)

 

$

(1,171,000

)

 

$

190,196

 

 

$

(1,039,649

)

Other comprehensive income, net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

1,703

 

 

 

1,703

 

 

 

—

 

 

 

3,727

 

 

 

(3,406

)

 

 

3,727

 

Other

 

 

(672

)

 

 

(672

)

 

 

—

 

 

 

—

 

 

 

672

 

 

 

(672

)

Other comprehensive income

 

 

1,031

 

 

 

1,031

 

 

 

—

 

 

 

3,727

 

 

 

(2,734

)

 

 

3,055

 

Comprehensive income (loss)

 

 

(446,689

)

 

 

651,860

 

 

 

(261,954

)

 

 

(1,167,273

)

 

 

187,462

 

 

 

(1,036,594

)

Less: Comprehensive loss attributable to noncontrolling interests

 

 

—

 

 

 

—

 

 

 

—

 

 

 

589,905

 

 

 

—

 

 

 

589,905

 

Comprehensive income (loss) attributable to MGM Resorts International

 

$

(446,689

)

 

$

651,860

 

 

$

(261,954

)

 

$

(577,368

)

 

$

187,462

 

 

$

(446,689

)


CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS INFORMATION

 

 

Year Ended December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

Non-Guarantor

Subsidiaries

 

 

 

 

 

 

 

 

 

 

 

Parent

 

 

Guarantor

Subsidiaries

 

 

MGP

 

 

Other

 

 

Elimination

 

 

Consolidated

 

 

 

(In thousands)

 

Cash flows from operating activities

 

 

 

Net cash provided by (used in) operating activities

 

$

(776,996

)

 

$

1,375,703

 

 

$

(58,473

)

 

$

464,845

 

 

$

—

 

 

$

1,005,079

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures, net of construction payable

 

 

—

 

 

 

(353,245

)

 

 

(129,308

)

 

 

(984,266

)

 

 

—

 

 

 

(1,466,819

)

Dispositions of property and equipment

 

 

—

 

 

 

7,901

 

 

 

—

 

 

 

131

 

 

 

—

 

 

 

8,032

 

Proceeds from sale of business units and investment in unconsolidated affiliates

 

 

—

 

 

 

92,207

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

92,207

 

Investments in and advances to unconsolidated affiliates

 

 

(141,390

)

 

 

(54,672

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(196,062

)

Distributions from unconsolidated affiliates in excess of cumulative earnings

 

 

—

 

 

 

201,612

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

201,612

 

Investments in cash deposits - maturities longer than 90 days

 

 

(200,205

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(200,205

)

Proceeds from cash deposits - maturities longer than 90 days

 

 

770,205

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

770,205

 

Intercompany accounts

 

 

—

 

 

 

(1,059,181

)

 

 

—

 

 

 

—

 

 

 

1,059,181

 

 

 

—

 

Other

 

 

—

 

 

 

(7,516

)

 

 

—

 

 

 

3,488

 

 

 

—

 

 

 

(4,028

)

Net cash provided by (used in) investing activities

 

 

428,610

 

 

 

(1,172,894

)

 

 

(129,308

)

 

 

(980,647

)

 

 

1,059,181

 

 

 

(795,058

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net borrowings (repayments) under bank credit facilities - maturities of 90 days or less

 

 

(28,000

)

 

 

—

 

 

 

—

 

 

 

1,005,275

 

 

 

—

 

 

 

977,275

 

Borrowings under bank credit facilities - maturities longer than 90 days

 

 

3,768,750

 

 

 

—

 

 

 

—

 

 

 

1,350,000

 

 

 

—

 

 

 

5,118,750

 

Repayments under bank credit facilities - maturities longer than 90 days

 

 

(3,768,750

)

 

 

—

 

 

 

—

 

 

 

(1,350,000

)

 

 

—

 

 

 

(5,118,750

)

Retirement of senior notes

 

 

(875,504

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(875,504

)

Debt issuance costs

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(46,170

)

 

 

—

 

 

 

(46,170

)

Intercompany accounts

 

 

1,003,750

 

 

 

(157,958

)

 

 

187,781

 

 

 

25,608

 

 

 

(1,059,181

)

 

 

—

 

Distributions to noncontrolling interest owners

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(307,227

)

 

 

—

 

 

 

(307,227

)

Proceeds from issuance of redeemable noncontrolling interests

 

 

—

 

 

 

—

 

 

 

—

 

 

 

6,250

 

 

 

—

 

 

 

6,250

 

Other

 

 

(12,512

)

 

 

—

 

 

 

—

 

 

 

9

 

 

 

—

 

 

 

(12,503

)

Net cash provided by (used in) financing activities

 

 

87,734

 

 

 

(157,958

)

 

 

187,781

 

 

 

683,745

 

 

 

(1,059,181

)

 

 

(257,879

)

Effect of exchange rate on cash

 

 

—

 

 

 

—

 

 

 

—

 

 

 

793

 

 

 

—

 

 

 

793

 

Cash and cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

Net increase (decrease) for the period

 

 

(260,652

)

 

 

44,851

 

 

 

—

 

 

 

168,736

 

 

 

—

 

 

 

(47,065

)

Change in cash related to assets held for sale

 

 

—

 

 

 

3,662

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,662

 

Balance, beginning of period

 

 

799,508

 

 

 

255,655

 

 

 

—

 

 

 

658,552

 

 

 

—

 

 

 

1,713,715

 

Balance, end of period

 

$

538,856

 

 

$

304,168

 

 

$

—

 

 

$

827,288

 

 

$

—

 

 

$

1,670,312

 


NOTE 20 — SELECTED QUARTERLY FINANCIAL RESULTS (UNAUDITED)

 

 

Quarter

 

 

 

First

 

 

Second

 

 

Third

 

 

Fourth

 

 

Total

 

2017

 

(In thousands, except per share data)

 

Net revenues

 

$

2,708,179

 

 

$

2,641,737

 

 

$

2,826,740

 

 

$

2,597,248

 

 

$

10,773,904

 

Operating income

 

 

497,181

 

 

 

501,046

 

 

 

493,861

 

 

 

223,404

 

 

 

1,715,492

 

Net income

 

 

253,009

 

 

 

241,620

 

 

 

176,496

 

 

 

1,425,293

 

 

 

2,096,418

 

Net income attributable to MGM Resorts

   International

 

 

206,847

 

 

 

210,611

 

 

 

149,115

 

 

 

1,393,713

 

 

 

1,960,286

 

Earnings per share-basic

 

$

0.36

 

 

$

0.37

 

 

$

0.26

 

 

$

2.43

 

 

$

3.39

 

Earnings per share-diluted

 

$

0.36

 

 

$

0.36

 

 

$

0.26

 

 

$

2.40

 

 

$

3.35

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenues

 

$

2,209,686

 

 

$

2,269,502

 

 

$

2,515,115

 

 

$

2,460,820

 

 

$

9,455,123

 

Operating income

 

 

315,954

 

 

 

769,055

 

 

 

712,755

 

 

 

282,023

 

 

 

2,079,787

 

Net income

 

 

91,198

 

 

 

514,498

 

 

 

561,260

 

 

 

69,922

 

 

 

1,236,878

 

Net income attributable to MGM Resorts

   International

 

 

66,799

 

 

 

474,353

 

 

 

535,619

 

 

 

24,669

 

 

 

1,101,440

 

Earnings per share-basic

 

$

0.12

 

 

$

0.84

 

 

$

0.94

 

 

$

0.04

 

 

$

1.94

 

Earnings per share-diluted

 

$

0.12

 

 

$

0.83

 

 

$

0.93

 

 

$

0.04

 

 

$

1.92

 

Because earnings per share amounts are calculated using the weighted average number of common and dilutive common equivalent shares outstanding during each quarter, the sum of the per share amounts for the four quarters does not equal the total earnings per share amounts for the year. The following sections list certain items affecting comparability of quarterly and year-to-date results and related per share amounts. Additional information related to these items is included elsewhere instatements or the notes to the accompanying financial statements.

Certain items affecting comparability for the year ended December 31, 2017 are as follows:

First Quarter. None;

thereto.

Second Quarter. The Company recorded a $41 million gain ($0.05 per share in the quarter and full year of 2017) related to a modification of the 2016 NV Energy exit fee. Additionally, the Company recorded a $36 million gain ($0.04 per share in the quarter and full year of 2017) related to Borgata’s share of a property tax settlement from Atlantic City;


Third Quarter. None; and

(a)(3).    Exhibits.

Fourth Quarter. The Company recorded a $1.4 billion tax benefit ($2.50 per share in the quarter and $2.47 per share for full year of 2017) related to the enactment of the Tax Act.


Certain items affecting comparability for the year ended December 31, 2016 are as follows:

First Quarter. None;

Second Quarter. In the second quarter and the full year, the Company recorded a $406 million and a $401 million gain, respectively, ($0.57 and $0.56 per share in the quarter and full year of 2016, respectively) for its share of CityCenter’s gain related to the sale of Crystals;

Third Quarter. The Company recorded a $430 million gain ($0.60 and $0.61 per share in the quarter and full year of 2016, respectively) related to the acquisition of Borgata. Additionally, the Company recorded a $139 million charge ($0.18 loss per share in the quarter and full year of 2016) related to NV Energy exit expense and a $13 million charge ($0.02 loss per share in the quarter and full year of 2016) related to our share of CityCenter’s NV Energy exit expense associated with the Company’s strategic decision to exit the fully bundled sales system of NV Energy; and

Fourth Quarter. None.

ITEM 16.

Exhibit
Number		Description
2.1
Equity Purchase Agreement by and between MGM CC Holdings, Inc., Infinity World Development Corp. and, solely for purposes of Article X thereof, MGM Resorts International, dated as of June 30, 2021 (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K filed on July 1, 2021).FORM 10K SUMMARY

2.2
Master Transaction Agreement by and among MGM Resorts International, CityCenter Land, LLC and Ace Purchaser LLC, dated as of June 30, 2021 (incorporated by reference to Exhibit 2.2 of the Company’s Current Report on Form 8-K filed on July 1, 2021).
2.3
Master Transaction Agreement, by and among MGM Resorts International, MGM Growth Properties LLC, MGM Growth Properties Operating Partnership LP, VICI Properties Inc., Venus Sub LLC, VICI Properties L.P. and VICI Properties OP LLC, dated as of August 4, 2021 (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K filed on August 5, 2021).
2.4
Purchase Agreement by and among BRE Spade Parent LLC, BRE Spade PropCo Holdings LLC, BRE Spade Mezz 1 LLC, BRE Spade Voteco LLC and MGM Resorts International, dated as of September 26, 2021 (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K filed on September 28, 2021).
2.5
Purchase Agreement by and between MGM Resorts International and HR Nevada, LLC, dated as of December 13, 2021 (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K filed on December 14, 2021).
3.1
Amended and Restated Certificate of Incorporation of the Company, dated June 14, 2011 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2011).
3.2
Amended and Restated Bylaws of the Company, effective January 13, 2021 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on January 15, 2021).
4.1(1)
Indenture, dated November 15, 1996, by and between Mandalay and Wells Fargo Bank (Colorado), N.A., as Trustee (the “Mandalay November 1996 Indenture”) (incorporated by reference to Exhibit 4(e) to the Mandalay October 1996 10-Q).

111

4.1(2)
Supplemental Indenture, dated as of November 15, 1996, to the Mandalay November 1996 Indenture, with respect to $150 million aggregate principal amount of 7.0% Senior Notes due 2036 (incorporated by reference to Exhibit 4(f) to the Mandalay October 1996 10-Q).
4.1(3)
7.0% Senior Notes due February 15, 2036, in the principal amount of $150,000,000 (incorporated by reference to Exhibit 4(g) to the Mandalay October 1996 10-Q).
4.1(4)
Indenture, dated March 22, 2012, between the Company and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on March 22, 2012).
4.1(5)
First Supplemental Indenture, dated March 22, 2012, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee with respect to $1.0 billion aggregate principal amount of 7.75% senior notes due 2022 (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K filed on March 22, 2012).
4.1(6)
Fourth Supplemental Indenture, dated November 25, 2014, among the Company, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among the Company and U.S. Bank National Association, as trustee, relating to the 6.000% senior notes due 2023 (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on November 25, 2014).
4.1(7)
Fifth Supplemental Indenture, dated August 19, 2016, among MGM Resorts International, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among MGM Resorts International and U.S. Bank National Association, as trustee, relating to the 4.625% senior notes due 2026 (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on August 19, 2016).
4.1(8)
Sixth Supplemental Indenture, dated June 18, 2018, among MGM Resorts International, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among MGM Resorts International and U.S. Bank National Association, as trustee, relating to the 5.750% senior notes due 2025 (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on June 18, 2018).
4.1(9)
Seventh Supplemental Indenture, dated April 10, 2019, among MGM Resorts International, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among MGM Resorts International and U.S. Bank National Association, as trustee, relating to the 5.500% senior notes due 2027 (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on April 10, 2019).
4.1(10)
Eighth Supplemental Indenture, dated May 4, 2020, among MGM Resorts International, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among MGM Resorts International and U.S. Bank National Association, as trustee, relating to the 6.750% senior notes due 2025 (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on May 4, 2020).
4.1(11)
Ninth Supplemental Indenture, dated October 13, 2020, among MGM Resorts International, the guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of March 22, 2012, among MGM Resorts International and U.S. Bank National Association, as trustee, relating to the 4.750% senior notes due 2028 (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on October 13, 2020).
4.1(12)
Indenture, dated as of August 12, 2016, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on August 12, 2016).
4.1(13)
Indenture, dated as of April 20, 2016, among MGP Escrow Issuer, LLC and MGP Escrow Co-Issuer, Inc. and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed April 21, 2016).
4.1(14)
Indenture, dated as of September 21, 2017, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 21, 2017).
4.1(15)
Indenture, dated as of January 25, 2019, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on January 25, 2019).
4.1(16)
Supplemental Indenture to the Indentures, dated as of June 15, 2018, among MGP OH, Inc., MGP Finance Co-Issuer, Inc. and MGM Growth Properties Operating Partnership LP (incorporated by reference to Exhibit 4.1 to the Quarterly Report on Form 10-Q of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on August 7, 2018).
112

4.1(17)
Second Supplemental Indenture to the Indentures, dated as of July 10, 2018, among Northfield Park Associates LLC, Cedar Downs OTB, LLC, MGP Finance Co-Issuer, Inc. and MGM Growth Properties Operating Partnership LP (incorporated by reference to Exhibit 4.1 to the Quarterly Report on Form 10-Q of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on November 6, 2018).
4.1(18)
Third Supplemental Indenture to the Indentures, dated as of January 29, 2019, among MGP Yonkers Realty Sub, LLC, YRL Associates, L.P., MGP Finance Co-Issuer, Inc., MGM Growth Properties Operating Partnership LP, the Subsidiary Guarantors named therein, and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.2 to the Quarterly Report on Form 10-Q of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on May 7, 2019).
4.1(19)
Fourth Supplemental Indenture to the Indentures, dated as of March 29, 2019, among MGP, MGP OH Propco, LLC, MGP Finance Co-Issuer, Inc., MGM Growth Properties Operating Partnership LP, the Subsidiary Guarantors named therein, and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.3 of the Company’s Quarterly Report on Form 10-Q of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on May 7, 2019).
4.1(20)
Indenture governing the 5.375% senior notes due 2024, dated as of May 16, 2019, between MGM China Holdings Limited and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on May 16, 2019).
4.1(21)
Indenture governing the 5.875% senior notes due 2026, dated as of May 16, 2019, between MGM China Holdings Limited and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K filed on May 16, 2019).
4.1(22)
Indenture, dated as of June 5, 2020, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on June 5, 2020).
4.1(23)
Indenture governing the 5.25% senior notes due 2025, dated as of June 18. 2020, between MGM China Holdings Limited and Wilmington Savings Fund Society, FSB, as trustee (incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K filed on June 22, 2020).
4.1(24)
Indenture, dated as of November 19, 2020, among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on November 20, 2020).
4.1(25)
Indenture governing the 4.75% senior notes due 2027, dated as of March 31, 2021, between MGM China Holdings Limited and Wilmington Savings Fund Society, FSB, as trustee (incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K filed on March 31, 2021).
4.1(26)
Seventh Supplemental Indenture, dated as of September 23, 2021, to the Indenture dated as of April 20, 2016, by and among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the Subsidiary Guarantors party thereto and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 27, 2021).
4.1(27)
Seventh Supplemental Indenture, dated as of September 23, 2021, to the Indenture dated as of August 12, 2016, by and among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the Subsidiary Guarantors party thereto and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.2 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 27, 2021).
4.1(28)
Seventh Supplemental Indenture, dated as of September 23, 2021, to the Indenture dated as of September 21, 2017, by and among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the Subsidiary Guarantors party thereto and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.3 of theCurrent Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filedon September 27, 2021).
4.1(29)
Seventh Supplemental Indenture, dated as of September 23, 2021, to the Indenture dated as of January 25, 2019, by and among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the Subsidiary Guarantors party thereto and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.4 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 27, 2021).
4.1(30)
First Supplemental Indenture, dated as of September 23, 2021, to the Indenture dated as of June 5, 2020, by and among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the Subsidiary Guarantors party thereto and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.5 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 27, 2021).
113

4.1(31)
First Supplemental Indenture, dated as of September 23, 2021, to the Indenture dated as of November 19, 2020, by and among MGM Growth Properties Operating Partnership LP, MGP Finance Co-Issuer, Inc., the Subsidiary Guarantors party thereto and U.S. Bank National Association, as Trustee (incorporated by reference to Exhibit 4.6 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on September 27, 2021).
4.2
Guarantee (Mandalay Resort Group 7.0% Senior Notes due 2036), dated as of April 25, 2005, by the Company and certain subsidiaries of the Company, in favor of The Bank of New York, as trustee for the benefit of the holders of the Notes pursuant to the Indenture referred to therein (incorporated by reference to Exhibit 10.22 of the Company's Quarterly Report on Form 10-Qfiled on November 9, 2005).
4.3
Amended and Restated Registration Rights Agreement, between MGM Growth Properties LLC and MGM Resorts International, dated as of October 5, 2017 (incorporated by reference to Exhibit 10.8 of the Annual Report on Form 10-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on March 1, 2018).
4.4
Description of MGM Common Stock (incorporated by reference to Exhibit 4.4 of the Company's Annual Report on Form 10-K filed on February 26, 2021).
10.1(1)
Credit Agreement, dated as of April 25, 2016, among MGM Growth Properties Operating Partnership LP, the financial institutions referred to as Lenders therein and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.17 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).
10.1(2)
First Amendment to Credit Agreement, dated October 26, 2016, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on October 26, 2016).
10.1(3)
Second Amendment to Credit Agreement, dated May 1, 2017, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on May 1, 2017).
10.1(4)
Third Amendment to Credit Agreement, dated March 23, 2018, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on March 26, 2018).
10.1(5)
Fourth Amendment to Credit Agreement, dated June 14, 2018, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on June 18, 2018).
10.1(6)
Fifth Amendment to Credit Agreement, dated as of February 14, 2020, among MGM Growth Properties Operating Partnership LP, the other loan parties and lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.5 of MGM Growth Properties LLC Current Report on Form 8-K filed on February 18, 2020).
10.1(7)
Credit Agreement, dated as of November 24, 2021, among the Company, Bank of America, N.A., as administrative agent, and certain lenders party thereto (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on November 26, 2021).
10.1(8)
Revolving Credit Facility Agreement, dated August 12, 2019 (the “2019 Revolving Credit Facility”), by and among MGM China Holdings Limited and certain Arrangers and Lenders party thereto (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on August 13, 2019).
10.1(9)
Amendment Letter to the 2019 Revolving Credit Facility Agreement, dated February 18, 2020, by and among MGM China Holdings Limited and certain Arrangers and Lenders Party thereto (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on May 1, 2020).
10.1(10)
Amendment Letter to the 2019 Revolving Credit Facility Agreement, dated April 9, 2020, by and among MGM China Holdings Limited and certain Arrangers and Lenders Party thereto (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on August 3, 2020).
10.1(11)
Revolving Credit Facility Agreement, dated May 26, 2020 (the “2020 Revolving Credit Facility”), by and among MGM China Holdings Limited and certain Lenders party thereto (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on May 29, 2020).
10.1(12)
Increase Confirmation to 2020 Revolving Credit Facility dated as of June 29, 2020 between the Increase Lender and the Facility Agent (incorporated by reference to Exhibit 10.1(13) of the Company’s Annual Report on Form 10-K filed on February 26, 2021).
10.1(13)
Amendment Letter to the 2019 Revolving Credit Facility, dated October 5, 2020, by and among MGM China Holdings Limited and certain Arrangers and Lenders Party thereto (incorporated by reference to Exhibit 10.1(14) of the Company’s Annual Report on Form 10-K filed on February 26, 2021).
114

10.1(14)
Amendment Letter to the 2020 Revolving Credit Facility, dated October 5, 2020, by and among MGM China Holdings Limited and certain Arrangers and Lenders Party thereto (incorporated by reference to Exhibit 10.1(15) of the Company’s Annual Report on Form 10-K filed on February 26, 2021).
10.1(15)
Amendment Letter to the 2019 Revolving Credit Facility, dated February 24, 2021, by and among MGM China Holdings Limited and certain Arrangers and Lenders Party thereto (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2021).
10.1(16)
Amendment Letter to the 2020 Revolving Credit Facility, dated February 24, 2021, by and among MGM China Holdings Limited and certain Arrangers and Lenders Party thereto (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2021).
10.1(17)
Guaranty Agreement, dated as of November 15, 2019 (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on November 18, 2019).
10.1(18)
Guaranty Agreement, dated as of February 14, 2020 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on May 1, 2020).
10.2(1)
Subconcession Contract for the Exploitation of Games Fortune and Chance or Other Games in Casino in the Special Administrative Region of Macau, dated April 19, 2005, between Sociedade de Jogos de Macau, S.A., as concessionaire, and MGM Grand Paradise S.A., as subconcessionaire (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on November 7, 2011).
10.2(2)
Sub-Concession Extension Contract, dated as of March 15, 2019, between MGM Grand Paradise Limited and Sociedade de Jogos de Macau, S.A. (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on March 18, 2019).
10.2(3)
MGM SJM Agreement, dated as of March 15, 2019, between MGM Grand Paradise Limited and Sociedade de Jogos de Macau, S.A. (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on March 18, 2019).
10.2(4)
Land Concession Agreement, dated as of April 18, 2005, relating to the MGM Macau resort and casino between the Special Administrative Region of Macau and MGM Grand Paradise, S.A. (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on August 9, 2011).
10.2(5)
Land Concession Agreement, effective as of January 9, 2013, relating to the MGM Macau resort and casino between the Special Administrative Region of Macau and MGM Grand Paradise S.A. (incorporated by reference to Exhibit 10.2(4) of the Company’s Annual Report on Form 10-K filed on March 1, 2013).
10.4(1)
Master Lease between MGP Lessor, LLC and MGM Lessee, LLC, dated April 25, 2016 (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).
10.4(2)
First Amendment to Master Lease, dated as of August 1, 2016, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on August 1, 2016).
10.4(3)
Second Amendment to Master Lease, dated as of October 5, 2017, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on October 6, 2017).
10.4(4)
Third Amendment to Master Lease Agreement, dated as of January 29, 2019, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on January 29, 2019).
10.4(5)
Fourth Amendment to Master Lease Agreement, dated as of March 7, 2019, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP filed on March 8, 2019).
10.4(6)
Fifth Amendment to Master Lease Agreement, dated as of April 1, 2019, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of MGM Growth Properties LLC and MGM Growth Properties Operating Partnership LP on Form 8-K filed on April 4, 2019).
10.4(7)
Sixth Amendment to Master Lease, by and between MGP Lessor, LLC and MGP Lessee, LLC, dated as of February 14, 2020 (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the Commission on February 18, 2020).
10.4(8)
Seventh Amendment to Master Lease Agreement, dated as of October 29, 2021, between MGP Lessor, LLC and MGM Lessee, LLC (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on October 29, 2021).
10.4(9)
Lease, by and between BCORE Paradise LLC and Bellagio, LLC, dated as of November 15, 2019 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on November 18, 2019).
115

10.4(10)
First Amendment to Lease, by and between BCORE Paradise LLC and Bellagio, LLC, dated as of April 14, 2021 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on August 6, 2021).
10.4(11)
Lease, by and between Mandalay PropCo, LLC, MGM Grand PropCo, LLC and MGM Lessee II, LLC, dated as of February 14, 2020 (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on February 18, 2020).
10.4(12)
Master Lease by and among Ace A PropCo LLC, Ace V PropCo LLC and MGM Lessee III, LLC, dated as of September 28, 2021 (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on September 28, 2021).
10.4(13)
Tax Protection Agreement, by and among Bellagio, LLC, BCORE Paradise Parent LLC and BCORE Paradise JV LLC, dated as of November 15, 2019 (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on November 18, 2019).
10.4(14)
Tax Protection Agreement, by and among MGM Resorts International, MGM Growth Properties Operating Partnership LP and MGP BREIT Venture 1 LLC, dated as of February 14, 2020 (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed on February 18, 2020).
*10.5(1)
Amended and Restated 2005 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on June 10, 2014).
*10.5(2)
Second Amended and Restated Annual Performance-Based Incentive Plan for Executive Officers (incorporated by reference to Appendix A of the Company’s Proxy Statement filed on April 20, 2016).
*10.5(3)
Deferred Compensation Plan II, as Amended and Restated, effective December 17, 2014 (incorporated by reference to Exhibit 10.4(6) of the Company’s Annual Report on Form 10-K filed on March 2, 2015).
*10.5(4)
Supplemental Executive Retirement Plan II, dated as of December 30, 2004 (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on January 10, 2005).
*10.5(5)
Amendment No. 1 to the Supplemental Executive Retirement Plan II, dated as of July 10, 2007 (incorporated by reference to Exhibit 10.3(12) of the Company's Annual Report on Form 10-K filed on February 29, 2008).
*10.5(6)
Amendment No. 2 to the Supplemental Executive Retirement Plan II, dated as of October 15, 2007 (incorporated by reference to Exhibit 10.3(14) of the Company's Annual Report on Form 10-K filed on February 29, 2008).
*10.5(7)
Amendment No. 1 to the Supplemental Executive Retirement Plan II, dated as of November 4, 2008 (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on November 7, 2008).
*10.5(8)
Employment Agreement, effective as of April 1, 2020, by and between the Company and Corey Sanders (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed on March 31, 2020).
*10.5(9)
Employment Agreement, effective as of April 1, 2020, by and between the Company and John McManus (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed on March 31, 2020).
*10.5(10)
Employment Agreement, effective as of July 29, 2020, by and between the Company and William Hornbuckle (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on July 31, 2020).
*10.5(11)
Employment Agreement, effective as of January 11, 2021, by and between the Company and Jonathan Halkyard (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on January 6, 2021).
*10.5(12)
Employment Agreement, effective June 3, 2021, by and between the Company and Tilak Mandadi.
*10.5(13)
Amended and Restated Deferred Compensation Plan for Non-employee Directors, effective as of June 5, 2014 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on August 11, 2014).
*10.5(14)
Form of Restricted Stock Units Agreement of the Company effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).
*10.5(15)
Form of Restricted Stock Units Agreement of the Company (Performance) effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).
*10.5(16)
Form of Sign-On RSU Award Agreement (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on October 5, 2016).
*10.5(17)
Form of RSU Agreement (Named Executive Officer Employment Agreement Awards) (incorporated by reference to Exhibit 10.4 of the Company's Current Report on Form 8-K filed on March 31, 2020).
116

*10.5(18)
Form of RSU Agreement (Hornbuckle) (incorporated by reference to Exhibit 10.5 of the Company's Current Report on Form 8-K filed on March 31, 2020).
*10.5(19)
Form of Performance Share Units Agreement of the Company effective for awards granted in October 2015 and thereafter (incorporated by reference to Exhibit 10.6 of the Company’s Quarterly Report on Form 10-Q filed on November 6, 2015).
*10.5(20)
Form of Bonus Performance Share Units Agreement of the Company, effective for bonus awards granted in March 2016 and thereafter (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on May 6, 2016).
*10.5(21)
Change of Control Policy for Executive Officers, dated as of November 5, 2012 (incorporated by reference to Exhibit 10.6 of the Company’s Current Report on Form 8-K filed on November 8, 2012).
*10.5(22)
Form of Memorandum Agreement re: Changes to Severance and Change of Control Policies (incorporated by reference to Exhibit 10.7 of the Company’s Current Report on Form 8-K filed on November 8, 2012).
*10.5(23)
MGM Growth Properties LLC 2016 Omnibus Incentive Plan (incorporated by reference to Exhibit 99.1 of the Registration Statement on Form S-8 of MGM Growth Properties LLC (File No. 333-210832) filed on April 19, 2016).
*10.5(24)
MGM Growth Properties LLC Form of 2016 Restricted Share Units Agreement (MGM Non-Employee Directors) (incorporated by reference to Exhibit 10.15 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).
*10.5(25)
MGM Growth Properties LLC Form of 2016 Restricted Share Units Agreement (MGM Employees) (incorporated by reference to Exhibit 10.16 of the Current Report on Form 8-K of MGM Growth Properties LLC filed on April 25, 2016).
*10.5(26)
Retirement Policy for Senior Officers, adopted January 10, 2017 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on January 12, 2017).
*10.5(27)
Amended and Restated Retirement Policy for Senior Officers, dated October 7, 2019 (incorporated by reference to Exhibit 10.5(31) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
*10.5(28)
Form of Letter to Employees re: Existing Equity Awards (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on March 10, 2017).
*10.5(29)
Form of Performance Share Unit Agreement (Bonus Payout) (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on March 10, 2017).
*10.5(30)
Form of Performance Share Unit Agreement (Annual Grant) (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K filed on March 10, 2017).
*10.5(31)
Form of Restricted Stock Unit Agreement (Non-Employee Director) (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K filed on March 10, 2017).
*10.5(32)
Form of Restricted Stock Unit Agreement (with Performance Hurdle) (incorporated by reference to Exhibit 10.5 of the Company’s Current Report on Form 8-K filed on March 10, 2017).
*10.5(33)
Form of Restricted Stock Unit Agreement (no Performance Hurdle) (incorporated by reference to Exhibit 10.6 of the Company’s Current Report on Form 8-K filed on March 10, 2017).
*10.5(34)
Form of Restricted Stock Unit Agreement (Bonus RSUs) (incorporated by reference to Exhibit 10.5(40) of the Company’s Annual Report on Form 10-K filed on March 1, 2018).
*10.5(35)
Form of Restricted Stock Unit (Deferred Payment Bonus) (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on May 7, 2018).
*10.5(36)
Form of Relative Performance Share Unit Agreement (Annual Grant) (incorporated by reference to Exhibit 10.5(41) of the Company’s Annual Report on Form 10‑K filed on March 1, 2018).
*10.5(37)
Form of Performance Share Unit Agreement (Annual Grant) (incorporated by reference to Exhibit 10.5(41) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
*10.5(38)
Form of Performance Share Unit Agreement (Annual Grant, Messrs. Hornbuckle, Sanders & McManus) (incorporated by reference to Exhibit 10.5(42) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
*10.5(39)
Form of Restricted Stock Unit Agreement (with Performance Hurdle) (incorporated by reference to Exhibit 10.5(43) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
*10.5(40)
Form of Restricted Stock Unit Agreement (no Performance Hurdle) (incorporated by reference to Exhibit 10.5(44) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
*10.5(41)
Form of Relative Performance Share Unit Agreement (Annual Grant) (incorporated by reference to Exhibit 10.5(45) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
*10.5(42)
Form of Relative Performance Share Unit Agreement (Annual Grant, Messrs. Hornbuckle, Sanders & McManus) (incorporated by reference to Exhibit 10.5(46) of the Company’s Annual Report on Form 10-K filed on February 27, 2020).
117

*10.5(43)
Form of Omnibus Amendment to Relative Performance Share Unit Agreements (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2021).
*10.5(44)
Form of Relative Performance Share Unit Agreement (Annual Grant).
*10.5(45)
Form of Relative Performance Share Unit Agreement (Annual Grant, Messrs. Hornbuckle, Sanders & McManus).
21
List of subsidiaries of the Company.
22
Subsidiary Guarantors.
23.1
Consent of Deloitte & Touche LLP, independent auditors to the Company.
31.1
Certification of Chief Executive Officer of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d‑14(a).
31.2
Certification of Chief Financial Officer of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d‑14(a).
**32.1
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.
**32.2
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.
99.1
Description of Regulation and Licensing.
101.INSInline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCHInline XBRL Taxonomy Extension Schema Document.
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document.
101.LABInline XBRL Taxonomy Extension Label Linkbase Document.
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document.
104The cover page from this Annual Report on Form 10-K for the year ended December 31, 2021, has been formatted in Inline XBRL.
*Management contract or compensatory plan or arrangement.
**Exhibits 32.1 and 32.2 shall not be deemed filed with the SEC, nor shall they be deemed incorporated by reference in any filing with the SEC under the Exchange Act or the Securities Act of 1933, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.
In accordance with Rule 402 of Regulation S-T, the XBRL information included in Exhibit 101 and Exhibit 104 to this Form 10-K shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

ITEM 16.    FORM 10-K SUMMARY

None.


118


SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


MGM Resorts International


By:

/s/ JAMES J. MURREN

By:

James/s/ WILLIAM J. Murren

HORNBUCKLE

Chairman of the Board and William J. Hornbuckle

Chief Executive Officer

and President

(Principal Executive Officer)


Dated: March 1, 2018

February 25, 2022


Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature

Title

Date

Signature

TitleDate
/s/ Jamess/ William J. Murren

Hornbuckle

Chief Executive Officer and President
(Principal Executive Officer)
February 25, 2022
William J. Hornbuckle
/s/ Jonathan S. Halkyard
Chief Financial Officer and Treasurer
(Principal Financial Officer)
February 25, 2022
Jonathan S. Halkyard
/s/ Todd R. Meinert
Senior Vice President and Chief Accounting Officer
(Principal Accounting Officer)
February 25, 2022
Todd R. Meinert
/s/ Paul Salem
Chairman of the Board and

Chief Executive Officer

(Principal Executive Officer)

March 1, 2018

February 25, 2022

James J. Murren

Paul Salem

/s/ Robert H. Baldwin

s/ Mary Chris Jammet

Chief Customer

Development Officer and

Director

March 1, 2018

February 25, 2022

Robert H. Baldwin

Mary Chris Jammet

/s/ Daniel J. D’Arrigo

s/ Barry Diller

Executive Vice President

and Chief Financial Officer

(Principal Financial Officer)

Director

March 1, 2018

February 25, 2022

Daniel J. D’Arrigo

Barry Diller

/s/ Robert C. Selwood

Executive Vice President

and Chief Accounting Officer

(Principal Accounting Officer)

March 1, 2018

Robert C. Selwood

/s/ William A. Bible

Director

March 1, 2018

William A. Bible

/s/ Mary Chris Gay

Director

March 1, 2018

Mary Chris Gay

/s/ William W. Grounds

Director

March 1, 2018

William W. Grounds

/s/ s/ Alexis M. Herman

Director

March 1, 2018

February 25, 2022

Alexis M. Herman

 
/s/ Roland Hernandez

s/ Joseph Levin

Director

March 1, 2018

February 25, 2022

Roland Hernandez

Joseph Levin

/s/ Rose McKinney-James
Director
February 25, 2022
Rose McKinney-James

119

Signature

Title

Date

/s/ John B. Kilroy, Jr.

Signature

Director

Title

March 1, 2018

Date

John B. Kilroy, Jr.

/s/ Keith A. Meister

Director

February 25, 2022

/s/ Rose McKinney-James

Keith A. Meister

Director

March 1, 2018

Rose McKinney-James

/s/ s/ Gregory M. Spierkel

Director

March 1, 2018

February 25, 2022

Gregory M. Spierkel

 
/ss/ Janet Swartz
 

Director
February 25, 2022
Janet Swartz
/s/ Daniel J. Taylor

Director

March 1, 2018

February 25, 2022

Daniel J. Taylor


120

MGM RESORTS INTERNATIONAL

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

(In thousands)

 

 

Balance at

 

 

Provision for

 

 

Write-offs,

 

 

 

 

 

 

 

Beginning of

 

 

Doubtful

 

 

Net of

 

 

Balance at

 

 

 

Period

 

 

Accounts

 

 

Recoveries

 

 

End of Period

 

Allowance for doubtful accounts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2017

 

$

97,920

 

 

$

20,603

 

 

$

(25,952

)

 

$

92,571

 

Year Ended December 31, 2016

 

 

89,789

 

 

 

10,863

 

 

 

(2,732

)

 

 

97,920

 

Year Ended December 31, 2015

 

 

89,602

 

 

 

54,691

 

 

 

(54,504

)

 

 

89,789

 

 

 

Balance at

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning of

 

 

 

 

 

 

 

 

 

 

Balance at

 

 

 

Period

 

 

Increase

 

 

Decrease

 

 

End of Period

 

Deferred income tax valuation allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2017

 

$

2,583,274

 

 

$

—

 

 

$

(69,536

)

 

$

2,513,738

 

Year Ended December 31, 2016

 

 

2,807,131

 

 

 

2,975

 

 

 

(226,832

)

 

 

2,583,274

 

Year Ended December 31, 2015

 

 

2,558,767

 

 

 

248,504

 

 

 

(140

)

 

 

2,807,131

 

113