SCHEDULE 14A INFORMATION

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LETTER FROM THE CHAIRMAN

 

 

Dear Stockholder:

 

You are cordially invited to attend the 2011 annual meeting of stockholders of Las Vegas Sands Corp., which will be held on June 10, 2011 at 2:00 p.m., New York time, at the Sheraton New York Hotel & Towers located at 811 Seventh Avenue, New York, New York 10019.

 

Details regarding admission to the meeting and the business to be presented at the meeting can be found in the accompanying Notice of Annual Meeting and Proxy Statement.

 

This year we again are pleased to take advantage of Securities and Exchange Commission rules that allow companies to furnish proxy materials to stockholders via the Internet. We believe that these rules allow us to provide our stockholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of producing and distributing materials for our annual meeting. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders of record and beneficial owners, unless they have directed us to provide the materials in a different manner. The Notice provides instructions on how to access and review all of the important information contained in the accompanying Proxy Statement and Annual Report to Stockholders, as well as how to submit a proxy by telephone or over the Internet. If you receive the Notice and would still like to receive a printed copy of our proxy materials, instructions for requesting these materials are included in the Notice. The Company plans to mail the Notice to stockholders by April 29, 2011. The Company will continue to mail a printed copy of this Proxy Statement and form of proxy to certain stockholders, and it expects that mailing to begin on or about April 29, 2011.

 

Your vote is important. Whether or not you are able to attend, it is important that your shares be represented at the meeting. Please follow the instructions in the Notice and vote as soon as possible.

 

On behalf of the Board of Directors and the management of Las Vegas Sands Corp., thank you very much for your support.

 

Yours sincerely,

 

Sheldon G. Adelson

Chairman of the Board

and Chief Executive Officer

 

April 29, 2011

 

NOTICE OF ANNUAL MEETING

 

to be held on

 

June 10, 2011

 

 

To the Stockholders:

 

The annual meeting of stockholders of Las Vegas Sands Corp., a Nevada corporation (the “Company”), will be held at the Sheraton New York Hotel & Towers located at 811 Seventh Avenue New York, New York 10019, on June 10, 2011, at 2:00 p.m., New York time, for the following purposes:

 

1. To elect three directors to the Board of Directors, each for a three-year term;

 

2. To consider and act upon the ratification of the selection of our independent registered public accounting firm;

 

3. To consider and act upon an advisory (non-binding) proposal on the compensation of the named executive officers;

 

4. To consider and act upon an advisory (non-binding) proposal on how frequently stockholders should vote to approve compensation of the named executive officers; and

 

5. To transact such other business as may properly come before the meeting or any adjournments thereof.

 

Stockholders of record at the close of business on April 15, 2011 are entitled to notice of and to vote at the meeting. A list of these stockholders will be available for examination by any stockholder, for any purpose relevant to the meeting, during ordinary business hours, at the Company’s executive offices, located at 3355 Las Vegas Boulevard South, Las Vegas, Nevada 89109, for a period of ten days prior to the meeting date. The list will also be available for inspection by any stockholder at the place of the stockholder meeting during the whole time thereof.

 

By Order of the Board of Directors,

 

 

Michael A. Leven

President, Chief Operating Officer

and Secretary

 

April 29, 2011

 

PLEASE FOLLOW THE INSTRUCTIONS IN THE COMPANY’S NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS TO VOTE YOUR PROXY.

 

PROXY STATEMENT

 

TABLE OF CONTENTS

 

 

PROXY STATEMENT

 

 

 

Our Board of Directors (the “Board”) has provided you with these proxy materials in connection with its solicitation of proxies to be voted at the annual meeting of stockholders. We will hold the annual meeting on Friday, June 10, 2011, at the Sheraton New York Hotel & Towers located at 811 Seventh Avenue, New York, New York 10019, beginning at 2:00 p.m., New York time. Please note that throughout these proxy materials we may refer to Las Vegas Sands Corp. as “the Company,” “we,” “us,” or “our.”

 

We are sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders of record and beneficial owners, unless they have directed us to provide the materials in a different manner. The Notice provides instructions on how to access and review all of the important information contained in this Proxy Statement, as well as how to submit a proxy by telephone or over the Internet. If you receive the Notice and would still like to receive a printed copy of our proxy materials, instructions for requesting these materials are included in the Notice. The Company plans to mail the Notice to stockholders by April 29, 2011. The Company will continue to mail a printed copy of this Proxy Statement and form of proxy to certain stockholders, and it expects that mailing to begin on or about April 29, 2011.

 

Only stockholders of record of the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), as of April 15, 2011, will be entitled to vote at the meeting or any adjournment thereof.

 

The authorized capital stock of the Company presently consists of 1,000,000,000 shares of Common Stock. At the close of business on April 15, 2011, 728,978,326 shares of Common Stock were outstanding and entitled to vote. Each stockholder is entitled to one vote for each share held of record on that date on all matters that may come before the meeting. There is no cumulative voting in the election of directors.

 

You may attend the annual meeting and vote your shares in person. You may also grant your proxy to vote by telephone or through the Internet by following the instructions included on the Notice, or by returning a signed, dated and marked proxy card if you received a paper copy of the proxy card.

 

The presence, in person or by proxy, of the holders of at least a majority of the total number of outstanding shares of the Common Stock is necessary to constitute a quorum at the meeting. If you are the beneficial owner of shares held in “street name” by a broker, your broker, as the record holder of the shares, must vote those shares in accordance with your instructions. In accordance with the rules of the New York Stock Exchange (the “NYSE”), a brokerage firm may give a proxy to vote its customer’s stock without customer instructions if the brokerage firm (i) transmitted proxy materials to the beneficial owner of the stock, (ii) did not receive voting instructions by the date specified in the statement accompanying the proxy materials and (iii) has no knowledge of any contest with respect to the actions to be taken at the stockholders’ meeting and such actions are adequately disclosed to stockholders. In addition, under new NYSE rules, brokerage firms may not vote their customers’ stock without instructions from the customer if the vote concerns the election of directors, a matter relating to executive compensation, including the advisory proposal on compensation and the advisory proposal on how frequently stockholders should vote to

approve the compensation of the named executive officers, which will be voted on at the meeting, or an authorization for a merger, consolidation or any matter that could substantially affect the rights or privileges of the stock. Abstentions and broker non-votes are counted as present for the purpose of determining the presence or absence of a quorum for the transaction of business.

 

The affirmative vote of a plurality of the votes cast at the meeting will be required for the election of directors. Each other item to be acted upon at the meeting requires the affirmative vote of the holders of a majority of the shares of Common Stock represented at the meeting in person or by proxy and entitled to vote on the item, assuming that a quorum is present or represented at the meeting. A properly executed proxy marked “WITHHOLD AUTHORITY” with respect to the election of one or more directors will not be voted with respect to the director or directors indicated, and will have no effect. With respect to the other proposals, a properly executed proxy marked “ABSTAIN,” although counted for purposes of determining whether there is a quorum, will not be voted. Accordingly, an abstention will have the same effect as a vote cast against a proposal. Under Nevada law, a broker non-vote will have no effect on the outcome of the matters presented for a stockholder vote.

 

Sheldon G. Adelson, the Chairman of the Board and Chief Executive Officer of our Company, his wife, Dr. Miriam Adelson, and trusts and other entities for the benefit of the Adelsons and their family members together beneficially owned approximately 47.1% of our outstanding Common Stock as of the record date. Mr. Adelson, Dr. Adelson, the trustees for the various trusts and individuals authorized to vote the shares of Common Stock held by such other entities have indicated that they will vote the shares of Common Stock over which they exercise voting control in accordance with the recommendations of our Board as set forth below.

 

Brokers are not permitted to vote on the election of directors or on the advisory proposal on executive compensation or the advisory proposal on how frequently stockholders should vote to approve compensation of the named executive officers without instructions from the beneficial owner. Therefore, if your shares are held in the name of your broker, bank or other nominee, your vote is especially important this year. Unless you vote your shares, your shares will not be voted in the election of directors as set forth in Proposal 1 below, the advisory proposal on executive compensation as set forth in Proposal 3 below or the advisory proposal on how frequently stockholders should vote to approve compensation of our executive officers as set forth in Proposal 4 below.

 

 

	•	“FOR” the election of each of the nominees for director as set forth under Proposal 1 below;
	•	“FOR” the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2011 as described in Proposal 2 below;
	•	“FOR” the advisory proposal on executive compensation as described in Proposal 3 below; and
	•	“FOR” every year as the frequency for advisory votes on the compensation of the named executive officers as described in Proposal 4 below.

 

 

You may revoke or change your proxy at any time before it is exercised in any of three ways:

 

 

You will not revoke a proxy merely by attending the annual meeting. To revoke or change a proxy, you must take one of the actions described above.

 

If you hold your shares in a brokerage or other account, you may submit new voting instructions by contacting your broker, bank or nominee.

Any revocation of a proxy, or a new proxy bearing a later date, should be sent to the following address: Corporate Secretary, Las Vegas Sands Corp., 3355 Las Vegas Sands Boulevard South, Las Vegas, Nevada 89109. To revoke a proxy previously submitted by telephone, Internet or mail, simply submit a new proxy at a later date before the taking of the vote at the Annual Meeting, in which case, the later submitted proxy will be recorded and the earlier proxy will be revoked.

 

Our Board presently is not aware of any matters other than those specifically stated in the Notice of Annual Meeting that are to be presented for action at the annual meeting. If any matter other than those described in this Proxy Statement is presented at the annual meeting on which a vote may properly be taken, the shares represented by proxies will be voted in accordance with the judgment of the person or persons voting those shares.

 

Any action on the items of business described above may be considered at the annual meeting at the time and on the date specified above or at any time and date to which the annual meeting may be properly adjourned or postponed.

 

The Notice of Annual Meeting and Proxy Statement and the Company’s 2011 Annual Report are available at http://investor.lasvegassands.com/proxy.cfm. These materials are also available on the Investor Relations page of our website, www.lasvegassands.com. In the future, for stockholders who have not already opted to do so, instead of receiving copies of the Notice of Annual Meeting and Proxy Statement and annual report in the mail, stockholders may elect to view proxy materials for the annual meeting on the Internet or receive proxy materials for the annual meeting by e-mail. The Notice will provide you with instructions regarding how to view our proxy materials for the annual meeting on the Internet and how to instruct us to send future proxy materials to you electronically by e-mail. Receiving your proxy materials online saves the Company the cost of producing and mailing documents to your home or business and gives you an automatic link to the proxy voting site.

 

Stockholders of Record.  If your shares are registered in your own name, to enroll in the electronic delivery service go directly to our transfer agent’s website at www.amstock.com anytime and follow the instructions.

 

Beneficial Stockholders.  If your shares are not registered in your name, to enroll in the electronic delivery service check the information provided to you by your bank or broker, or contact your bank or broker for information on electronic delivery service.

 

In connection with the Company’s annual meeting of stockholders, the Company is required to send to each stockholder of record a Notice or a Proxy Statement and annual report, and to arrange for a Notice or a Proxy Statement and annual report to be sent to each beneficial stockholder whose shares are held by or in the name of a broker, bank, trust or other nominee. Because many stockholders hold shares of Common Stock in multiple accounts, this process would result in duplicate mailings of Notices or Proxy Statements and annual reports to stockholders who share the same address. To avoid this duplication, unless the Company receives instructions to the contrary from one or more of the stockholders sharing a mailing address, only one Notice or Proxy Statement will be sent to each address. Stockholders may, on their own initiative, avoid receiving duplicate mailings and save the Company the cost of producing and mailing duplicate documents as follows:

 

Stockholders of Record.  If your shares are registered in your own name and you are interested in consenting to the delivery of a single Notice or Proxy Statement and annual report, to enroll in the electronic delivery service go directly to our transfer agent’s website at www.amstock.com anytime and follow the instructions.

 

Beneficial Stockholders.  If your shares are not registered in your own name, your broker, bank, trust or other nominee that holds your shares may have asked you to consent to the delivery of a single Notice or Proxy Statement

and annual report if there are other Las Vegas Sands Corp. stockholders who share an address with you. If you currently receive more than one Notice or Proxy Statement and annual report at your household, and would like to receive only one copy of each in the future, you should contact your nominee.

 

Right to Request Separate Copies.  If you consent to the delivery of a single Notice or Proxy Statement and annual report but later decide that you would prefer to receive a separate copy of the Notice or Proxy Statement or annual report, as applicable, for each stockholder sharing your address, then please notify us or your nominee, as applicable, and we or they will promptly deliver such additional Notices or Proxy Statements or annual reports. If you wish to receive a separate copy of the Notice or Proxy Statement or annual report for each stockholder sharing your address in the future, you may contact our transfer agent, American Stock Transfer & Trust Company, directly by telephone at 1-800-937-5449 or by visiting its website at www.amstock.com and following the instructions.

 

All meeting attendees may be asked to present a valid, government-issued photo identification (federal, state or local), such as a driver’s license or passport, and proof of beneficial ownership if you hold your shares through a broker, bank or other nominee before entering the meeting. Attendees may be subject to security inspections. Video and audio recording devices and other electronic devices will not be permitted at the meeting.

 

The following table sets forth information as of March 31, 2011 as to the beneficial ownership of our Common Stock, in each case, by:

 

 

 

 

 

Our Board currently has eight directors, divided into three classes, designated as Class I, Class II and Class III. Members of each class serve for a three-year term. Stockholders elect one class of directors at each annual meeting. Our directors are expected to attend each annual meeting of stockholders and all of our directors attended our 2010 annual meeting of stockholders held on June 3, 2010. The term of office of the current Class I directors will expire at the 2011 meeting. The term of office of the current Class II directors will be subject to renewal in 2012, and the term of office of the current Class III directors will be subject to renewal in 2013. Each director holds office until his or her successor has been duly elected and qualified or the director’s earlier resignation, death or removal. The nominees are all current directors of the Company, and each nominee has indicated that he will serve if elected. We do not anticipate that any nominee will be unable or unwilling to stand for election, but if that happens, your proxy will be voted for another person nominated by the Board.

 

In addition to the specific professional experience of each director, we chose our directors because they are highly accomplished in their respective fields, insightful and inquisitive. In addition, we believe each of our directors possesses sound business judgment and is highly ethical. While we do not have a formal diversity policy, we consider a wide range of factors in determining the composition of our Board, including professional experience, skills, education, training and background.

 

The nominees for re-election for a three-year term ending in 2014 are as follows:

 

 

The other members of the Board are as follows:

 

 

There is no family relationship between any director or executive officer of the Company.

 

Board

 

NYSE Listing Standards.  Until November 5, 2010, the Company qualified as a “controlled company” under the corporate governance rules of the NYSE, and certain provisions of the rules were not applicable to the Company until that date. “Controlled companies” under the NYSE corporate governance rules are companies of which more than 50 percent of the voting power is held by an individual, a group or another company. The Company previously qualified as a “controlled company” under this definition by virtue of the ownership by Mr. Adelson, his wife and trusts and other entities for the benefit of the Adelsons and their family members of more than 50 percent of the voting power of the Common Stock and their ability to elect the entire Board. During the time that it qualified as a controlled company, the Company chose to take advantage of certain of the exemptions provided in the NYSE’s rules and was not required to have a majority of independent directors or a nominating and governance committee or a compensation committee composed entirely of independent directors.

 

Under the NYSE transition rules, the Company must have a majority of independent directors and a nominating and governance committee and a compensation committee composed entirely of independent directors by November 5, 2011.

 

Independent Directors.  The Board has determined that four of the eight members of the Board satisfy the criteria for independence under applicable rules promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the NYSE corporate governance rules, namely Messrs. Ader, Koo, Schwartz and Siegel. In making its determinations, the Board reviewed all the relevant facts and circumstances, the standards set forth in our Corporate Governance Guidelines, the NYSE rules and other applicable laws and regulations.

 

Two of our directors, Messrs. Chafetz and Forman, have business and personal relationships with our controlling stockholder, Mr. Adelson. Mr. Chafetz was a stockholder, vice president and director of the entity that owned and operated the COMDEX trade show and The Sands Expo and Convention Center, which were created and developed by Mr. Adelson. Mr. Forman was Vice President and General Counsel of this entity. Mr. Chafetz also is a trustee of several trusts for the benefit of Mr. Adelson’s family members that beneficially own shares of our Common Stock. For additional information, see “Proxy and Voting Information — How You Can Vote” and “Principal Stockholders” above. These relationships with Mr. Adelson also include making joint investments and other significant financial dealings. As a result, Messrs. Adelson, Chafetz and Forman may have their financial interests aligned and therefore, the Board does not consider Messrs. Chafetz and Forman to be independent directors.

 

Board Meetings.  The Board held ten meetings and acted by written consent four times during 2010. The work of the Company’s directors is performed not only at meetings of the Board and its committees, but also by consideration of the Company’s business through the review of documents and in numerous communications among Board members and others. In 2010, all directors attended at least 75% of the aggregate of all meetings of the Board and committees on which they served during the periods in which they served.

 

Committees

 

Standing Committees.  Our Board has three standing committees: an audit committee (the “Audit Committee”), a compensation committee (the “Compensation Committee”) and a nominating and governance committee (the “Nominating and Governance Committee”).

 

Audit Committee.  The Audit Committee operates under a written charter, a copy of which is attached as Appendix A to this proxy statement. The primary purpose of the Audit Committee is to assist the Board in monitoring the integrity of our financial statements, our independent registered public accounting firm’s qualifications and independence, the performance of our audit function and independent registered public accounting firm and our compliance with legal and regulatory requirements. Among other things, our Audit Committee selects our independent registered public accounting firm and reviews with such firm the plan, scope and results of such audit, and the fees for the services performed. The Audit Committee also reviews with management, the

independent registered public accounting firm and internal auditors the adequacy of internal control systems, receives internal audit reports and subsequently reports its findings to the full Board.

 

The current members of our Audit Committee are Irwin A. Siegel (Chairman), Jason N. Ader and Jeffrey H. Schwartz. The Board has determined that Messrs. Siegel, Ader and Schwartz are each independent under applicable NYSE and federal securities rules and regulations on independence of Audit Committee members. The Board has determined that each of the members of the Audit Committee is “financially literate” and that Mr. Siegel qualifies as an “audit committee financial expert,” as defined in the NYSE’s listing standards and federal securities rules and regulations. The Audit Committee held ten meetings and acted by written consent two times during 2010.

 

Compensation Committee.  The Compensation Committee operates under a written charter pursuant to which it has direct responsibility for the compensation of our executive officers. The Compensation Committee has the authority to set salaries, bonuses and other elements of employment and to approve employment agreements for our executive officers. The Compensation Committee also may delegate its authority to the extent permitted by the Board, the Compensation Committee charter, our by-laws, state law and NYSE regulations. In addition, the Compensation Committee has the authority to approve employee benefit plans as well as to administer our 2004 Equity Award Plan. The current members of the Compensation Committee are Charles D. Forman (Chair), Irwin Chafetz, George P. Koo, Jeffrey H. Schwartz (who joined the Compensation Committee on February 1, 2011) and Irwin A. Siegel. The Compensation Committee held nine meetings and acted by written consent six times during 2010. Under Section 162(m) of the Internal Revenue Code (“Section 162(m)”), compensation paid to members of senior management (other than our chief financial officer) in excess of $1 million per year is not deductible by the Company unless the compensation is “performance-based” as described in the applicable regulations. As required by its charter, the Compensation Committee established a Performance Subcommittee to make the required determinations relating to “performance-based” compensation for purposes of Section 162(m). Messrs. Koo, Schwartz (as of February 1, 2011) and Siegel are the current members of the Performance Subcommittee and are outside directors for purposes of Section 162(m). The Performance Subcommittee met as part of each Compensation Committee meeting and did not act by written consent during 2010. Additional information about the Compensation Committee, its responsibilities and its activities is provided under the caption “Compensation Discussion and Analysis.”

 

Nominating and Governance Committee.  The Nominating and Governance Committee operates under a written charter and has the authority to, among other things, review and make recommendations regarding the composition of the Board and its committees; develop and implement policies and procedures for the selection of Board members; identify individuals qualified to become Board members and select, or recommend that the Board select, director nominees; assess, develop and make recommendations to the Board with respect to Board effectiveness and related corporate governance matters, including corporate governance guidelines and procedures intended to organize the Board appropriately; and oversee the evaluation of the Board and management. The current members of the Nominating and Governance Committee are Sheldon G. Adelson, Jason N. Ader and Jeffrey H. Schwartz. Mr. Leven resigned from the Nominating and Governance Committee on February 1, 2010 at the time of Mr. Schwartz’s election to the Committee. The Nominating and Governance Committee held one formal meeting and did not act by written consent during 2010. The activities of the members of the Nominating and Governance Committee are undertaken by numerous communications among its members and were discussed during regularly scheduled Board meetings.

 

Compensation Committee Interlocks and Insider Participation.  The members of the Compensation Committee during 2010 were Messrs. Forman, Chafetz, Koo and Siegel. Mr. Forman was, from 1989 to 1995, an officer of Interface Group Massachusetts Inc. and Interface Group-Nevada, Inc., companies controlled by Mr. Adelson. Mr. Chafetz is a manager of The Interface Group, LLC, a Massachusetts limited liability company that controls Interface Group-Massachusetts, LLC, a company that formerly owned and operated Interface Travel. From 1989 to 1995, Mr. Chafetz was a Vice President and director of Interface Group-Nevada, Inc. and a director and Vice-President of our subsidiary, Las Vegas Sands, Inc. Except as described above, none of the other individuals who served as a member of our Compensation Committee during 2010 is, or has been, an employee or officer of the Company. None of our executive officers serves, or in the past year has served, as a member of the Board or Compensation Committee of any entity that has one or more executive officers who serve on our Board or Compensation Committee. Mr. Chafetz is a party to certain transactions described under “Certain Transactions” below.

 

Commitment to Corporate Governance.  Our Board and management have a strong commitment to effective corporate governance. We have in place a comprehensive corporate governance framework for our operations which, among other things, takes into account the requirements of the Sarbanes-Oxley Act of 2002 and the applicable rules and regulations of the Securities and Exchange Commission and the NYSE. The key components of this framework are set forth in our amended and restated articles of incorporation and by-laws, along with the following additional documents:

 

 

Copies of each of these documents are available on our website at www.lasvegassands.com by clicking on “Investor Relations,” and then on “Documents & Charters” under the section entitled “Corporate Governance.” Copies also are available without charge by sending a written request to Investor Relations at the following address: Las Vegas Sands Corp., 3355 Las Vegas Boulevard South, Las Vegas, Nevada 89109.

 

Corporate Governance Guidelines.  We have adopted Corporate Governance Guidelines for the Company setting forth the general principles governing the conduct of the Company’s business and the role, functions, duties and responsibilities of the Board, including, but not limited to, such matters as composition, membership criteria, orientation and continuing education, retirement, committees, compensation, meeting procedures, annual evaluation and management succession planning.

 

Code of Business Conduct and Ethics.  We have adopted a Code of Business Conduct and Ethics that applies to all of the Company’s directors, officers (including the principal executive officer, principal financial officer and principal accounting officer), employees and agents. The Code of Business Conduct and Ethics establishes policies and procedures that the Board believes promote the highest standards of integrity, compliance with the law and personal accountability. The Company’s Code of Business Conduct and Ethics is provided to all new directors, officers and employees.

 

Statement on Reporting Ethical Violations.  We have adopted a Statement on Reporting Ethical Violations to facilitate and encourage the reporting of any misconduct at the Company, including violations or potential violations of our Code of Business Conduct and Ethics, and to ensure that those reporting such misconduct will not be subject to harassment, intimidation or other retaliatory action. The Statement on Reporting Ethical Violations is provided to all new directors, officers and employees.

 

Related Party Transactions.  We have established policies and procedures for the review, approval and/or ratification of related party transactions. Under its charter, the Audit Committee approves all related party transactions required to be disclosed in our public filings and all transactions involving executive officers or directors of the Company that are required to be approved by the Audit Committee under the Company’s Code of Business Conduct and Ethics. Under our procedures, our executive officers and directors provide our corporate counsel’s office with the details of any such proposed transactions. Proposed transactions are then presented to our Audit Committee for review, discussion and approval. The Audit Committee may, in its discretion, request additional information from the director or executive officer involved in the proposed transaction or from management prior to granting approval for a related party transaction. All other related party transactions by individuals subject to our Code of Business Conduct and Ethics must be approved by our Chief Compliance Officer and reported to the Compliance Committee and the Audit Committee.

 

Nomination of Directors.  The Nominating and Governance Committee proposed to the Board the candidates nominated for election at this annual meeting. The Nominating and Governance Committee, in making its selection

of director candidates, considers the appropriate skills and personal characteristics required in light of the then-current makeup of the Board and in the context of the perceived needs of the Company at the time.

 

The Nominating and Governance Committee considers a number of factors in selecting director candidates, including:

 

 

The Nominating and Governance Committee has the discretion to weight these factors as it deems appropriate. The importance of these factors may vary from candidate to candidate.

 

The Nominating and Governance Committee will consider candidates recommended by directors and members of management and may, in its discretion, engage one or more search firms to assist in the recruitment of director candidates. The Nominating and Governance Committee does not have a policy for considering director candidates recommended by security holders and believes that not having such a policy is appropriate in light of the significant ownership of the Company’s Common Stock by Mr. Adelson and his family.

 

Board Leadership Structure.  Mr. Adelson serves as the Chairman of the Board and Chief Executive Officer of our Company. Mr. Adelson is the founder of our Company and has served as its Chairman and Chief Executive Officer since the Company was founded. The Board believes that Mr. Adelson is best suited to serve as both its

Chairman and Chief Executive Officer because he is the most familiar with the Company’s businesses and industry and best able to establish strategic priorities for the Company. In addition, Mr. Adelson, his wife and trusts and other entities for the benefit of the Adelsons and their family members together beneficially owned approximately 47.1% of our outstanding Common Stock as of the record date. Accordingly, Mr. Adelson exercises significant influence over our business policies and affairs, including the composition of our Board of Directors. As a result, the Board believes that Mr. Adelson’s continuing service as both Chairman and Chief Executive Officer is beneficial to the Company and provides an effective leadership structure. The Company does not have a lead director.

 

The Board’s Role in Risk Oversight.  The Board of Directors, directly and through its committees, is actively involved in the oversight of the Company’s risk management policies. The Audit Committee is charged with overseeing enterprise risk management, generally, and with reviewing and discussing with management the Company’s major financial risk exposures and the steps management has taken to monitor, control and manage these exposures, including the Company’s risk assessment and risk management guidelines and policies. The Compensation Committee oversees the Company’s compensation policies generally to determine whether they create risks that are reasonably likely to have a material adverse effect on the Company. The Audit Committee and the Compensation Committee receive reports from, and discuss these matters with, management and regularly report on these matters to the Board.

 

2010 Executive Compensation Risk Assessment.  The Compensation Committee has evaluated the Company’s compensation structure from the perspective of enterprise risk management and the terms of the Company’s compensation policies generally and does not believe that that the Company’s compensation policies and practices provide incentives for employees to take inappropriate business risks. As described under “Compensation Discussion and Analysis” below regarding bonuses for named executive officers, Mr. Adelson is eligible to receive bonuses under his employment agreement, subject to the Company’s achieving predetermined EBITDA-based performance goals. Under their employment agreements or other arrangements, the other named executive officers are eligible for discretionary bonuses, up to a target percentage of their respective base salaries. Similarly, any bonuses for employees other than the named executive officers are granted on a discretionary basis. The Compensation Committee believes that the discretionary nature of these bonuses does not incentivize the named executive officers or other employees to take inappropriate business risks.

 

Presiding Non-Management Director.  In accordance with applicable rules of the NYSE and the Company’s Corporate Governance Guidelines, the Board meets at least quarterly in executive session without management directors or any members of the Company’s management being present. At each executive session a presiding director chosen by a majority of the directors present at such session presides over the session.

 

Stockholder Communications with the Board and Audit Committee.  The Board has established a process for stockholders and interested parties to communicate with members of the Board, the Audit Committee, the non-management directors and the presiding non-management director of executive sessions of the Board.

 

Director Communications

 

Stockholders and interested parties who wish to contact our Board, the Chairman of the Board, the presiding non-management director of executive sessions or any individual director are invited to do so by writing to:

 

Board of Directors of Las Vegas Sands Corp.

c/o Corporate Secretary

3355 Las Vegas Boulevard South

Las Vegas, Nevada 89109

 

Complaints and concerns relating to our accounting, internal accounting controls or auditing matters should be communicated to the Audit Committee of our Board using the procedures described below. All other stockholder and other communications addressed to our Board will be referred to our presiding non-management director of executive sessions and tracked by the Corporate Secretary. Stockholder and other communications addressed to a particular director will be referred to that director.

Audit Committee Communications

 

Complaints and concerns relating to our accounting, internal accounting controls, or auditing matters should be communicated to the Audit Committee of our Board, which consists solely of non-employee directors. Any such communication may be anonymous and may be reported to the Audit Committee through the Office of the General Counsel by writing to:

 

Las Vegas Sands Corp.

3355 Las Vegas Boulevard South

Las Vegas, Nevada 89109

Attention: Office of the General Counsel

 

All communications will be reviewed under Audit Committee direction and oversight by the Office of the General Counsel, the Audit Services Group, which performs the Company’s internal audit function, or such other persons as the Audit Committee determines to be appropriate. Confidentiality will be maintained to the fullest extent possible, consistent with the need to conduct an adequate review. Prompt and appropriate corrective action will be taken when and as warranted in the judgment of the Audit Committee. The Office of the General Counsel will prepare a periodic summary report of all such communications for the Audit Committee.

 

This section contains certain information about our executive officers, including their names and ages (as of the mailing of these proxy materials), positions held and periods during which they have held such positions. There are no arrangements or understandings between our officers and any other person pursuant to which they were selected as officers.

 

 

For background information on Messrs. Adelson and Leven, please see “Board of Directors.”

 

Robert G. Goldstein has been the Executive Vice President and President of Global Gaming Operations of our Company since January 1, 2011 and the Executive Vice President of our Company since July 2009. He served as the Senior Vice President of our Company from August 2004 until July 2009. He has been the Executive Vice President of Las Vegas Sands, LLC (or its predecessor, Las Vegas Sands, Inc.) since July 2009 and was its Senior Vice President from December 1995 until July 2009. From 1992 until joining our Company in December 1995, Mr. Goldstein was the Executive Vice President of Marketing at the Sands Hotel in Atlantic City as well as an Executive Vice President of the parent Pratt Hotel Corporation.

 

Mr. Kay has served as the Company’s Executive Vice President and Chief Financial Officer since October 10, 2010 and as its Senior Vice President and Chief Financial Officer since December 1, 2008. Prior to joining our Company, Mr. Kay served as the Senior Executive Vice President and Chief Financial Officer of CB Richard Ellis Group, Inc. from July 2002 to November 2008. From December 1999 until June 2002, Mr. Kay served as the Vice President and Chief Financial Officer of Dole Food Company, Inc.

 

Section 16(a) Beneficial Ownership Reporting Compliance

 

Section 16(a) of the Exchange Act requires the Company’s executive officers and directors to file reports of ownership of our Common Stock with the Securities and Exchange Commission. Executive officers and directors are required to furnish the Company with copies of all Section 16(a) forms that they file. Based upon a review of these filings and representations from the Company’s directors and executive officers that no other reports were required, the Company notes that all reports for the year 2010 were filed on a timely basis.

 

The following discussion and analysis contains statements regarding Company performance objectives and targets. These objectives and targets are disclosed in the limited context of our compensation program and should not be understood to be statements of management’s expectations or estimates of results or other guidance. We specifically caution investors not to apply these statements to other contexts.

 

This discussion supplements the more detailed information concerning executive compensation in the tables and narrative discussion that follow under “Executive Compensation and Other Information.” This Compensation Discussion and Analysis section discusses our compensation philosophy and objectives and the compensation policies and programs for the following individuals who are referred to as “named executive officers”:

 

 

2010 Financial and Business Performance

 

2010 was the most successful year in the Company’s history. In addition to the opening of the Marina Bay Sands integrated resort in April, the Company achieved record financial results. Highlights of the Company’s 2010 financial performance include:

 

 

The Objectives of Our Executive Compensation Program

 

Our executive compensation program is directed by the Compensation Committee of the Board of Directors. The Compensation Committee has developed an executive compensation program that is designed to:

 

 

The Process of Setting Executive Compensation

 

We entered into employment agreements with Messrs. Adelson, Leven, Goldstein, Kay and Arasi that provide the overall framework for each executive’s compensation, including base salary and target bonus amounts. The Compensation Committee approved the compensation packages for each of these individuals at the time we entered into their respective employment agreements and approves all bonus and equity awards granted during the terms of these agreements. In making its determinations, the Compensation Committee considered the views and recommendations of our Chief Executive Officer and Chief Operating Officer in establishing 2010 compensation for Messrs. Goldstein, Kay and Arasi and certain other highly compensated employees.

 

The Committee’s Compensation Consultant

 

The Compensation Committee has retained HVS Executive Search as its independent executive compensation consultant since 2006. HVS has advised the Compensation Committee in its evaluation of compensation levels for our Chief Executive Officer and our other named executive officers. HVS provides its advice on an as-needed basis upon the request of the Compensation Committee. During 2010, the Compensation Committee instructed HVS Executive Search to provide advice on a compensation package for Mr. Adelson, whose renewed employment

agreement was scheduled to expire in December 2010. The Compensation Committee also directed HVS to provide advice on new compensation packages for Mr. Leven and Mr. Goldstein. In addition, the Company retained HVS during 2010 to advise on management compensation generally.

 

HVS Executive Search is a division of HVS, a consulting firm focused on the hospitality industry. During 2010, HVS provided appraisal services to the lenders to Sands China Ltd. In the past, HVS has provided appraisal services to lenders to the Company and Sands China Ltd. and may do so again in the future.

 

Benchmarking

 

In connection with the Compensation Committee’s 2010 review of Mr. Adelson’s employment agreement and its development of new compensation packages for Mr. Leven and Mr. Goldstein, the Compensation Committee compared the elements of executive compensation and total compensation against compensation levels of executives in comparable positions at peer group companies. The current peer group was selected by the Compensation Committee’s consultant, based on industry, revenue and market capitalization and other shared characteristics and consists of the following companies

 

 

Elements of Executive Officer Compensation and Why We Chose to Pay Each Element

 

In 2010, the principal components of compensation for the named executive officers were:

 

 

Employment Agreements

 

Messrs. Adelson, Leven, Goldstein and Kay are, and Mr. Arasi prior to his resignation was, employed pursuant to multi-year employment agreements that reflect the individual negotiations with the relevant named executive officer. The Company uses multi-year employment agreements to foster retention, to be competitive and to protect the business with restrictive covenants, such as non-competition, non-solicitation and confidentiality provision. The employment agreements provide for severance pay in the event of the involuntary termination of the executive’s employment without cause (or, where applicable, termination for good reason), which serves as consideration for the restrictive covenants and allows the executive to remain focused on the Company’s interests.

 

Mr. Adelson.  In 2004, in connection with our initial public offering, we entered into a long-term employment agreement with Mr. Adelson with an initial term of five years, subject to extensions for successive one-year periods upon

mutual agreement of the parties no later than 90 days prior to the expiration of the initial or any renewal term of the agreement. The Company and Mr. Adelson agreed to extend his employment agreement for one year on the same financial terms in each of December 2009 and December 2010. The Compensation Committee believed that extending Mr. Adelson’s employment agreement was in the best interests of the Company and its stockholders and that, based on information provided by the compensation consultant, the terms of Mr. Adelson’s 2004 agreement were fair to the Company.

 

Mr. Leven.  In March 2009, we entered into an employment agreement with Mr. Leven that was scheduled to expire on March 11, 2011. On November 13, 2010, we entered into a new employment agreement with Mr. Leven that became effective on January 1, 2011 and will expire on November 12, 2012. The Compensation Committee considered factors including Mr. Leven’s performance as the Company’s President and Chief Operating Officer since March 2009, his knowledge and experience in the hospitality industry and the Chief Executive Officer’s recommendations when approving Mr. Leven’s new employment agreement.

 

Mr. Goldstein.  On July 10, 2009, in connection with Mr. Goldstein’s promotion to his new position as the Company’s Executive Vice President, we entered into a new employment agreement with him that was scheduled to terminate on December 31, 2011. On January 11, 2011, we entered into a new employment agreement with Mr. Goldstein in connection with his assuming his new position as the Company’s Executive Vice President and President of Global Gaming Operations. Mr. Goldstein’s new employment agreement was effective as of January 1, 2011 and terminates on December 31, 2012, but may be extended by agreement of the parties. The Compensation Committee considered factors including Mr. Goldstein’s performance as the Company’s Executive Vice President and his tenure at the Company, his business experience and knowledge of the gaming industry and the Chief Executive Officer’s recommendations when approving Mr. Goldstein’s new employment agreement.

 

Mr. Kay.  We entered into an employment agreement with Mr. Kay that was effective on December 1, 2008 and terminates on December 31, 2011, subject to extensions. Mr. Kay’s employment agreement was amended on January 10, 2010, to increase his base salary, retroactive to December 1, 2009, and to accelerate the vesting of some of his options. The Compensation Committee considered factors including Mr. Kay’s performance during 2009, his leadership role in the Company, compensation levels for individuals holding similar positions in other organizations and the Chief Executive Officer’s recommendations when approving the amendment to Mr. Kay’s employment agreement.

 

Mr. Arasi.  Mr. Arasi served as the Chief Executive Officer of the Company’s subsidiary, Marina Bay Sands Pte. Ltd. from August 3, 2009 and has resigned, effective April 30, 2011. The Compensation Committee considered factors, including Mr. Arasi’s performance as the Chief Executive Officer of Marina Bay Sands and extensive experience as a senior executive in other international hospitality companies, when approving Mr. Arasi’s employment arrangements.

 

Mr. Jacobs.  Mr. Jacobs served as the Chief Executive Officer of the Company’s subsidiary, Sands China Ltd., whose shares are listed on The Stock Exchange of Hong Kong Limited, until July 23, 2010. The Remuneration Committee of the Board of Directors of Sands China Ltd. was responsible for approving all decisions relating to Mr. Jacobs’s 2010 compensation.

 

The major elements of our executive officer compensation and details regarding how each component was determined are described below.

 

Base Salary

 

Base salary levels for the named executive officers are set forth in their respective employment agreements or other arrangements. The base salary amounts were determined at the time we entered into the various employment agreements or the other arrangements were determined, based on each individual’s professional experience and scope of responsibilities within the organization.

 

The employment agreements or other arrangements for Messrs. Adelson, Leven, Goldstein, Kay, Arasi and Jacobs provide for the following annual base salaries:

 

 

 

Short-term Incentives

 

Messrs. Adelson, Leven, Goldstein, Kay and Arasi are eligible for annual performance-based cash incentives under the Company’s Executive Cash Incentive Plan, which was created to establish a program of annual incentive compensation awards for designated officers and other key executives that is directly related to our performance results. Some of these named executive officers also are entitled to discretionary bonuses awarded pursuant to their employment agreements or by a determination of the Compensation Committee. The Compensation Committee retains the right to exercise discretion in determining bonus levels for these named executive officers.

 

Mr. Adelson

 

Mr. Adelson is eligible for two types of annual performance-based incentive opportunities, a base bonus and an annual supplemental bonus. The target base bonus and annual bonus opportunities are described in Mr. Adelson’s employment agreement, as set forth below.

 

Base bonus.  Mr. Adelson is eligible for cash incentive bonuses earned and payable quarterly primarily subject to the Company’s attainment of predetermined EBITDA-based performance targets. Base bonus payments may range from $0 (if the Company does not achieve the predetermined EBITDA performance target) to a defined maximum opportunity specified in Mr. Adelson’s employment agreement. Mr. Adelson’s target base bonus for 2005 was $500,000. Commencing with 2006 and for each year during the term of his employment, Mr. Adelson’s target annual base bonus increases automatically by at least four percent (4%) of the sum of (x) his base salary for the immediately preceding year plus (y) the base bonus paid to him with respect to the immediately preceding year.

 

Annual supplemental bonus.  Under his employment agreement, Mr. Adelson is eligible to receive an annual cash incentive bonus equal to a percentage of the sum of his base salary plus his base bonus. The annual bonus payable to Mr. Adelson is contingent on the Company’s achievement of annual performance targets that are primarily EBITDA-based. The amount of Mr. Adelson’s annual supplemental bonus is equal to a percentage of the sum of (x) his base salary for the year plus (y) the base bonus paid to him for the year. Mr. Adelson’s annual supplemental bonus payments may range from $0 (if the Company does not achieve 80% of the predetermined EBITDA performance target) to a defined maximum opportunity (if the Company achieves 110% of the predetermined EBITDA performance target). Mr. Adelson’s annual supplemental bonus payments increase ratably if EBITDA reaches 80% to 100% of the predetermined EBITDA target. Mr. Adelson’s target and maximum annual supplemental bonus opportunities as a percentage of base salary and base bonus for 2010 were 90% and 180%, respectively.

 

The performance targets specified under Mr. Adelson’s employment agreement are primarily EBITDA-based. The EBITDA-based performance targets are established annually by the Performance Subcommittee following consultation with the other members of the Compensation Committee, our executive officers and such other members of our management as the Performance Subcommittee deems appropriate. The Performance Subcommittee established different EBITDA-based performance targets for the base bonus and the annual supplemental bonus. The 2010 targets represent the EBITDA level that must be achieved in order for Mr. Adelson to receive 100% of his target base bonus or his target annual supplemental bonus. For 2010, the Performance Subcommittee established an EBITDA-based performance target of $1.025 billion relating to Mr. Adelson’s base bonus. The

Performance Subcommittee ultimately established an EBITDA-based performance target relating to Mr. Adelson’s 2010 annual supplemental bonus based on the following two components:

 

 

In determining the 2010 annual EBITDA-based targets, the Performance Subcommittee’s goal was to set an aggressive objective based on its review of the annual budget information provided by management and the Board’s discussions with our executive officers and management about the assumptions underlying the 2010 budget, including the Company’s development and operating plans for the upcoming year and the projected opening date and first year performance for Marina Bay Sands. In making its determinations, the Performance Subcommittee recognized the inherent difficulty of providing appropriate financial targets for Mr. Adelson, given the economy generally, the competitive challenges facing the Company in the markets in which it operates and the Company’s global development plans. The Performance Subcommittee believed that the achievement of the 2010 performance targets required Mr. Adelson to perform at a high level to earn the target bonus payments.

 

In 2010, the Company achieved the predetermined EBITDA-based performance target required for the payment of Mr. Adelson’s base bonus. In addition, the Company achieved 123.3% of the predetermined EBITDA-based performance target relating to all Company properties, except for Marina Bay Sands, and 103.5% of the revised EBITDA-based performance target relating to Marina Bay Sands. Accordingly, Mr. Adelson received a base bonus of $1,508,400 and an annual supplemental bonus of $4,150,069 for his 2010 performance. Mr. Adelson’s base and annual supplemental bonuses are shown in the Summary Compensation Table under “Non-Equity Incentive Plan Compensation.”

 

Messrs. Leven, Goldstein, Kay and Arasi

 

Messrs. Leven, Goldstein, Kay and Arasi are eligible to receive discretionary bonuses subject to their achievement of individual or Company performance objectives established by the Performance Subcommittee following consultation with the other members of the Compensation Committee, the named executive officers and such other members of our management as the Performance Subcommittee deems appropriate. In making its determinations regarding 2010 bonuses, the Compensation Committee gave equal 50% weighting to (a) the Company’s achievement of the EBITDA-based performance targets described below and (b) the individual performances of Messrs. Leven, Goldstein, Kay and Arasi, including, where applicable, their achievement of individual performance goals as described below. In evaluating the qualitative aspects of the individual performances of Messrs. Leven, Goldstein, Kay and Arasi, the Compensation Committee also considered factors, including the achievement of specific property-related performance objectives and the status of the Company’s development projects. The Committee also considered Mr. Adelson’s recommendations for the amount of 2010 bonus payments to these executive officers.

 

The Performance Subcommittee established the following EBITDA-based performance-based financial targets:

 

 

 

In 2010, in addition to meeting the EBITDA-based performance targets for all Company properties, except for Marina Bay Sands, and the EBITDA-based performance target for Marina Bay Sands, the Company also achieved 95.1% of the EBITDA-based performance target relating to the Las Vegas properties. Overall, the Company achieved 108.4% of its predetermined EBITDA-based financial performance targets.

 

Mr. Leven.  Under his 2009 employment agreement, Mr. Leven is eligible to receive an annual bonus, with a target bonus of 50% of his base salary, or $1,000,000. The Performance Subcommittee did not establish individual performance goals for Mr. Leven. However, during its deliberations about Mr. Leven’s 2010 bonus, the Performance Subcommittee evaluated Mr. Leven’s performance generally, including his global leadership role and his impact on the Company’s operations and development plans, and assessed a 100% performance weighting for these qualitative factors. In February 2011, based on these reasons and the Company’s achievement of 108.4% of its predetermined EBITDA-based performance targets, Mr. Leven was awarded a bonus of $1,020,000 in respect of his 2010 performance, representing 102% of his target bonus opportunity. Mr. Leven’s bonus is shown in the Summary Compensation Table under “Bonus.”

 

Mr. Goldstein.  Under Mr. Goldstein’s 2009 employment agreement, he is eligible to receive a discretionary cash bonus in each of 2010 and 2011 of a maximum of $250,000. The Performance Subcommittee did not establish individual performance goals for Mr. Goldstein. However, during its deliberations about Mr. Goldstein’s 2010 bonus, the Performance Subcommittee evaluated Mr. Goldstein’s performance generally, including his leadership of the Las Vegas operations and the Company’s gaming operations and assessed a 100% performance weighting for these qualitative factors. In February 2011, based on these reasons and the achievement by the Company’s Las Vegas operations of 95.1% of the predetermined EBITDA-based performance target, Mr. Goldstein was awarded a bonus of $243,750 in respect of his 2010 performance, representing 97.5% of his target bonus opportunity. Mr. Goldstein’s bonus is shown in the Summary Compensation Table under “Bonus.”

 

Mr. Kay.  Under his employment agreement, Mr. Kay is eligible to receive an annual cash bonus based on the achievement of annual performance objectives and in an amount not to exceed 100% of his base salary, absent a determination of unusual circumstances or exceptional performance. The Performance Subcommittee established the following four 2010 performance goals for Mr. Kay: (1) develop and execute on a plan to enhance the company’s capital structure, including managing the upcoming debt maturities in Macau and Las Vegas in 2011 and 2012; (2) build a comprehensive Corporate operational and financial model to support and enhance the Corporate Finance forecasting capabilities and to support decision making; (3) enhance leadership of the information technology function and develop company-wide consensus on an information technology three year plan; and (4) create a global PMO organization to project manage strategic, construction and information technology projects. The Performance Subcommittee determined that Mr. Kay achieved all of his individual performance objectives. In February 2011, based on these reasons and the Company’s achievement of 108.4% of its predetermined EBITDA-based performance targets, Mr. Kay was awarded a bonus of $1,100,000 in respect of his 2010 performance, representing 100% of his target bonus opportunity. Mr. Kay’s bonus is shown in the Summary Compensation Table under “Non-Equity Incentive Plan Compensation.”

 

Mr. Arasi.  Under his employment agreement, Mr. Arasi is eligible to receive a discretionary cash bonus based on his achievement of individual and company goals and objectives, with a target bonus of 50% of his base salary, or $548,322 (pro- rated for Mr. Arasi’s salary increase during 2010). The Performance Subcommittee did not establish individual performance goals for Mr. Arasi. However, during its deliberations about Mr. Arasi’s 2010 bonus, the Performance Subcommittee evaluated Mr. Arasi’s performance generally, including his leadership role and contributions to the opening of Marina Bay Sands and the ramping up of operations at Marina Bay Sands following its opening and assessed a 50% performance weighting for these qualitative factors. In February 2011, based on these reasons and the achievement by Marina Bay Sands of 103.5% of its predetermined EBITDA-based performance targets, Mr. Arasi was awarded a bonus of $421,111 in respect of his 2010 performance, representing 76.8% of his target bonus opportunity. Mr. Arasi’s bonus is shown in the Summary Compensation Table under “Bonus.”

Mr. Jacobs

 

Mr. Jacobs ceased to serve as the Chief Executive Officer of Sands China Ltd. on July 23, 2010. The Remuneration Committee did not establish bonus performance targets for Mr. Jacobs in respect of his 2010 performance prior to the termination of his employment. Mr. Jacobs did not receive a bonus in respect of his 2010 performance.

 

Long-term Incentives (Equity Awards)

 

Messrs. Adelson, Leven, Goldstein, Kay and Arasi are eligible for long-term, equity incentives under the Company’s 2004 Equity Award Plan, which is administered by the Compensation Committee and was created to give us a competitive edge in attracting, retaining and motivating employees and to enable us to provide incentives directly related to increases in our stockholder value. Mr. Adelson is entitled to annual equity incentive awards under his employment agreement, subject to the Company’s achievement of EBITDA-based performance targets as described below. The employment agreements for Messrs. Leven, Goldstein, Kay and Arasi do not provide for annual grants of equity incentive awards, although the Compensation Committee is authorized to award such grants in its sole discretion.

 

Mr. Adelson.  Mr. Adelson’s annual equity incentive awards under his employment agreement are split into two equal components:

 

 

Under his employment agreement, Mr. Adelson is entitled to a specified aggregate target grant value of his equity incentive awards as the Company achieves higher annualized six-month EBITDA levels. Mr. Adelson is entitled to receive equity incentive awards with a total value of $3,650,000 because the Company, prior to 2009, had achieved more than $1 billion of annualized six-month EBITDAR.

 

The value of Mr. Adelson’s 2010 stock option award opportunity was $1,825,000 (one half of the total equity incentive award of $3,650,000). Accordingly, on February 23, 2010, Mr. Adelson received a grant of options to purchase 151,076 shares of our Common Stock, based on the Black-Scholes value of the stock option award on the grant date. The grant date fair value of this award of $1,825,000 is shown in the Summary Compensation Table under “Option Awards.”

 

Mr. Adelson’s target grant value for his restricted stock award for 2010 was $1,825,000 (one half of the total equity incentive award of $3,650,000). However, in 2009, the Company did not achieve the predetermined EBITDAR-based performance target of $1.5 billion relating to the award of restricted stock. As a result, Mr. Adelson was not entitled to receive a grant in 2010 of restricted stock in respect of his 2009 performance.

 

Mr. Leven.  Under his employment agreement, Mr. Leven was granted an option to purchase 3,000,000 shares of our Common Stock on March 11, 2009 and an additional option to purchase 1,000,000 shares of our Common Stock on January 1, 2010. Each option vested as to 25% of the shares subject to such option on March 11, 2010 and each option fully vested on March 11, 2011. Each option will expire on March 11, 2014. The grant date fair value of Mr. Leven’s option awards are shown in the Summary Compensation Table under “Option Awards.” In addition,

pursuant to his 2011 employment agreement, Mr. Leven received a grant of 350,000 shares of restricted stock on January 1, 2011.

 

Mr. Goldstein.  Mr. Goldstein did not receive a grant of stock options or restricted stock during 2010. Under his 2009 employment agreement, Mr. Goldstein was granted options to purchase 500,000 shares of our Common Stock on July 11, 2009, 250,000 of which vested on January 1, 2010 and 250,000 of which vested on January 1, 2011. In addition, Mr. Goldstein’s 2009 and 2011 employment agreements provide that if Mr. Goldstein remains continuously employed with the Company through December 31, 2011, then upon termination of his employment with the Company at or following that date, Mr. Goldstein will be entitled to receive accelerated vesting of all of his awards of stock options and restricted stock that were outstanding as of July 10, 2009. Mr. Goldstein also received a grant of 125,000 shares of restricted stock on January 11, 2011 at the time he entered into his 2011 employment agreement.

 

Mr. Kay.  Mr. Kay received discretionary grants of options to purchase 300,000 shares of our Common Stock on February 23, 2010, and 88,000 shares of our Common Stock on June 11, 2010. These option grants were awarded to him in recognition of his leadership role at the Company, including in connection with the Company’s financing arrangements and strengthening the Company’s finance organization. The grant date fair values of Mr. Kay’s option awards are shown in the Summary Compensation Table under “Option Awards.”

 

In addition, pursuant to his employment agreement, Mr. Kay received a grant of options to purchase 100,000 shares of our Common Stock on January 1, 2009. On January 10, 2010, as noted above under “— Employment Agreements,” the Company amended the terms of Mr. Kay’s employment agreement and option grant so that (a) an additional 20,000 options were deemed retroactively vested as of January 1, 2010 resulting in a cumulative total of 25,000 options being vested as of that date and (b) the remaining 75,000 options will vest in equal installments of 25,000 options each on January 1, 2011 (which has already vested), January 1, 2012 and January 1, 2013.

 

Mr. Arasi.  Pursuant to his employment agreement, Mr. Arasi received a grant of options to purchase 150,000 shares of our Common Stock on August 3, 2010. These options will be forfeited in connection with Mr. Arasi’s resignation from the Company. The grant date fair value of Mr. Arasi’s option award is shown in the Summary Compensation Table under “Option Awards.”

 

Mr. Jacobs.  On May 11, 2010, Mr. Jacobs received a grant of options to purchase 2,500,000 shares of Sands China Ltd. stock, subject to Mr. Jacobs’ timely acceptance of the offer of the grant of the options and to the Option Terms and Conditions. The grant was approved by the Remuneration Committee of the Board of Directors of Sands China Ltd. The options were awarded under the Sands China Ltd. Equity Award Plan. The options did not vest and expired upon the termination of Mr. Jacobs’s employment. The grant date fair value of Mr. Jacobs’s Sands China Ltd. option award is shown in the Summary Compensation Table under “Option Awards.”

 

For more information about equity incentive awards, see “— Executive Compensation Related Policies and Practices — Stock Option and Restricted Stock Grant Practices” and “Executive Compensation and Other Information — Employment Agreements.” Grants made during 2010 are included in the Grants of Plan-Based Awards Table.

 

Personal Benefits

 

Mr. Adelson is entitled to be reimbursed up to $100,000 annually for personal legal and financial planning fees and expenses under his employment agreement. Mr. Adelson also is entitled during the term of his employment to the full-time and exclusive use of an automobile and a driver of his choice and security services for himself, his spouse and minor children. In addition, pursuant to his employment agreement, Mr. Adelson is entitled to the use of a Boeing Business Jet for his travel in connection with Company business.

 

Mr. Leven is entitled to be reimbursed for the initiation fee for membership in a country club of his choice pursuant to his employment agreement, which he has not requested to date. In addition, the Company will make available to Mr. Leven a jet aircraft in connection with both business and personal use, including personal use by Mr. Leven’s spouse. The value of aircraft usage for personal purposes by Mr. Leven and/or his spouse is imputed to Mr. Leven as compensation using the Internal Revenue Service Standard Industry Fare Level tables.

Mr. Goldstein’s 2009 employment agreement provides that his spouse is entitled to accompany him on at least two trips to Asia each year at the Company’s sole cost and expense.

 

The Company provides certain of its named executive officers with access to corporate memberships at country clubs for business purposes. The Company requires these executives to reimburse it in full for personal use of these facilities. The Company also permits its named executive officers to use Company personnel for home repairs during business hours on a limited basis. The Company requires that these executives reimburse it in full for these services. The Company does not permit personal use of corporate aircraft by its executive officers, except for Mr. Leven as noted above. On certain occasions, an executive officer’s spouse or other immediate family member has accompanied the executive officer on business-related flights on aircraft that we own or lease. The Compensation Committee believes that providing these benefits to our executives is appropriate, given the status in our Company of these individuals, and helps facilitate our executives’ performance of their duties.

 

Our executive officers also participate in a group supplemental medical insurance program available only to certain of our senior officers. Our executive officers, as well as certain other employees, are also entitled to use workout facilities at the Canyon Ranch Spa at The Venetian Resort Hotel Casino and The Palazzo Resort Hotel Casino in Las Vegas and to receive dry cleaning services. Our executive officers are entitled to receive other employee benefits generally made available to our employees.

 

For more information, see footnote (5) to the Summary Compensation Table under “Executive Officer Compensation and Other Information.”

 

Change in Control and Termination Payments

 

The long-term employment agreements with Messrs. Adelson, Leven, Goldstein, Kay and Arasi provide for payments and the continuation of benefits upon certain terminations of employment or if there is a change in control of the Company. These provisions are based on negotiations with these named executive officers. In addition, the employment agreements with Messrs. Adelson, Goldstein, Kay and Arasi include restrictive covenants relating to future employment. The Compensation Committee believed the post-termination payments were necessary in order to enable us to provide a competitive compensation package so that we could retain these named executive officers.

 

The Company’s 2004 Equity Award Plan was established in 2004. The purpose of the plan is to provide a means through which the Company may attract able persons to enter and remain in the employ of the Company. The change in control provisions of the plan were designed in furtherance of this goal.

 

Further information about benefits under certain change in control and terminations of employment are described below under “Potential Payments Upon Termination or Change in Control.”

 

Tax and Accounting Considerations Relating to Executive Compensation

 

Section 162(m) of the Internal Revenue Code

 

The Compensation Committee’s general policy is that compensation should qualify as tax deductible to the Company for federal income tax purposes whenever possible. Under Section 162(m) of the Internal Revenue Code (the “Code”), compensation paid to certain members of senior management (other than our chief financial officer) in excess of $1 million per year is not deductible unless the compensation is “performance-based” as described in the regulations under Section 162(m). Compensation is generally “performance-based” if it is determined using pre-established objective formulas and criteria approved by stockholders within the past five years. Compensation awards under our Executive Cash Incentive Plan generally are designed to maximize tax deductibility by satisfying the performance-based compensation exception to Section 162(m). The maximum amount payable to a participant under the Executive Cash Incentive Plan in respect of an annual bonus award that is intended to qualify for the performance-based compensation exception to Section 162(m) is $10.0 million. In addition, awards under the 2004 Equity Award Plan also may satisfy the performance-based compensation exception to Section 162(m). The performance-based provisions of our Executive Cash Incentive Plan and 2004 Equity Award Plan were approved by our stockholders at the 2008 annual meeting of stockholders. Changes in applicable tax laws and regulations as well as factors beyond the control of the Compensation Committee can adversely impact the deductibility of compensation paid to our executive officers who are covered by Section 162(m).

Named executive officers and other officers or key executives designated by the Compensation Committee are eligible to receive cash bonuses payable under our Executive Cash Incentive Plan in the amounts determined in accordance with their employment agreements. The document governing the Executive Cash Incentive Plan specifies that the Compensation Committee, in its sole discretion, has full power and authority to administer the plan, including, among other things, the authority to designate an award as one that does not qualify as “performance-based” compensation under Section 162(m) of the Code. Accordingly, the bonuses paid to certain of the named executive officers and included in the Summary Compensation Table under the heading “Bonus” were not made pursuant to the Executive Cash Incentive Plan. The Performance Subcommittee makes all determinations relating to “performance-based” compensation for purposes of Section 162(m). The Compensation Committee believes that mathematical formulas cannot always anticipate and fairly address every situation that might arise. The Compensation Committee therefore retains the authority to adjust compensation in the case of unexpected, unusual or non-recurring events or to attract and retain key executive talent, even if this results in the payment of non-deductible compensation or to otherwise award or pay non-deductible compensation if the Committee deems it in the best interests of the Company and its stockholders to do so.

 

In addition, bonus awards granted under the Executive Cash Incentive Plan must specify performance criteria to be achieved, a minimum acceptable level of achievement below which no payment or award will be made and a formula for determining the amount of any payment or award to be made if performance is at or above the minimum acceptable level but falls short of full achievement of the specified performance criteria. The Compensation Committee may modify performance criteria or the related minimum acceptable level of achievement, in whole or in part, as the Committee deems appropriate and equitable, provided that no such modification may be made that would cause an award to no longer qualify as “performance-based” compensation under Section 162(m).

 

The Board of Directors has appointed the Compensation Committee to administer the 2004 Equity Award Plan. The Performance Subcommittee makes all determinations relating to “performance-based” compensation for purposes of Section 162(m). Under the plan, the Performance Subcommittee may not grant or provide payment in respect of an award intended to qualify as “performance-based” compensation unless the applicable performance goals have been achieved and, under the applicable performance formula, all or some of the performance award has been earned for the performance period.

 

Sections 280G and 4999 of the Code (“Golden Parachute Payments”)

 

If any payment to Mr. Adelson pursuant to his employment agreement is subject to the excise tax imposed by Section 4999 of the Code, the payment that is considered a “parachute payment” will be limited to the greatest amount which can be paid under Section 280G without causing any loss of deduction to the Company but only if, by reason of such reduction, the net after tax benefit to him (as defined in his employment agreement) exceeds the net after tax benefit if the reduction were not made.

 

Deferred Compensation

 

The Las Vegas Sands Corp. Deferred Compensation Plan was created to provide benefits to non-employee directors and a select group of management or highly paid Las Vegas Sands Corp. employees to be selected by our Compensation Committee. All non-employee directors are eligible to participate in the Deferred Compensation Plan. The Deferred Compensation Plan allows participating employees to defer payment of their base salary and/or bonus and non-employee directors to defer payment of director fees. There are currently no participants in the Deferred Compensation Plan.

 

Executive Compensation Related Policies and Practices

 

Policies Regarding Stock Ownership and Hedging the Economic Risk of Stock Ownership

 

The Company believes that the number of shares of the Company’s Common Stock owned by each named executive officer is a personal decision and encourages stock ownership, including through the compensation policies applicable to its named executive officers. Accordingly the Company has not adopted a policy requiring its named executive officers to hold a portion of their stock during their employment at the Company.

Under our securities trading policy, our officers, directors and employees are not permitted to purchase our Common Stock on margin, sell our Common Stock short or buy or sell puts, calls or other derivative instruments relating to our Common Stock. Although we discourage speculative hedging transactions, we do permit long-term hedging transactions that are designed to protect an individual’s investment in our Common Stock provided that the hedge is for at least six months in duration and relates to stock or options held by the individual.

 

Stock Option and Restricted Stock Grant Practices

 

Mr. Adelson’s employment agreement provides that grants of stock options are to be made by March 15 of the year to which the grant relates. On February 23, 2010, the Company granted Mr. Adelson stock options for the 2010 calendar year. Grants of restricted stock to Mr. Adelson are to be made by March 15 following the year to which the award relates, provided that the performance goals for such prior year have been achieved. In 2009, the Company did not achieve the predetermined EBITDA-based performance target relating to the award of restricted stock. Accordingly, the Company did not grant Mr. Adelson restricted stock in respect of his 2009 performance.

 

Grants of stock options and restricted stock under our 2004 Equity Award Plan are approved by the Compensation Committee’s Performance Subcommittee. Each of the members of the Performance Subcommittee is an independent director. The stock option grants to Messrs. Adelson, Leven, Goldstein, Kay and Arasi under their employment agreements are effective as of their respective grant dates, which are either the date of approval or, if later, the first date of employment or a future date specified in the employment agreement. The exercise price of all stock options to purchase Las Vegas Sands Corp. Common Stock is equal to the fair market value of Las Vegas Sands Corp. Common Stock on the grant date. The stock option grant to purchase shares of Sands China Ltd. to Mr. Jacobs was made pursuant to the Sands China Ltd. Equity Award Plan and was approved by the Remuneration Committee of the Board of Directors of Sands China Ltd. The exercise price for Mr. Jacobs’s option grant to purchase shares of Sands China Ltd. was the average closing price of Sands China Ltd. shares on The Stock Exchange of Hong Kong Limited for the five trading days immediately preceding the grant date.

 

The Compensation Committee has reviewed and discussed the foregoing Compensation Discussion and Analysis contained in this Proxy Statement with management and, based on the review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included by reference in the Company’s Annual Report on Form 10-K and this Proxy Statement.

 

Charles D. Forman, Chair

Irwin Chafetz

George P. Koo

Jeffrey H. Schwartz (as of February 1, 2011)

Irwin A. Siegel

 

The foregoing Compensation Committee Report does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act of 1933 (the “Securities Act”) or the Exchange Act, except to the extent the Company specifically incorporates this report by reference therein.

 

The following table provides information regarding compensation for our Chief Executive Officer, Chief Financial Officer and each of our other three highest paid executive officers serving as such at December 31, 2010, and the former Chief Executive Officer of Sands China Ltd.

 

2010 Summary Compensation Table

 

 

 

 

 

All Other Compensation

 

 

 

 

 

 

2010 Grants of Plan-Based Awards

 

The following table presents information on potential payment opportunities in respect of 2010 performance under our Executive Cash Incentive Plan for the named executive officers and equity awards granted during 2010 under our 2004 Equity Award Plan or, in the case of Mr. Jacobs, the Sands China Equity Award Plan.

 

 

 

 

Employment Agreements

 

The executive employment agreements and other arrangements provide for the payment of base salary, cash incentive bonuses and equity incentive awards as described below.

 

Mr. Adelson.  Mr. Adelson’s employment agreement provides for an annual base salary. He also is eligible for target base bonus and annual supplemental bonus payments and annual awards of options to purchase shares of Common Stock and shares of restricted stock as described under “Compensation Discussion and Analysis — Employment Agreements.”

Mr. Leven.  Mr. Leven’s 2009 employment agreement provided for an annual base salary, a target bonus and stock option grants, as described under “Compensation Discussion and Analysis — Employment Agreements.” Mr. Leven’s 2011 employment agreement provides for an annual base salary and a grant of shares of restricted stock. Under his 2011 employment agreement, Mr. Leven is eligible to receive an annual bonus with a target bonus of 100% of his base salary, or $3,000,000, in respect of his 2011 performance, subject to the achievement of performance targets to be established in accordance with the Company’s management incentive plan.

 

Mr. Goldstein.  Mr. Goldstein’s 2009 employment agreement provided for an annual base salary, a maximum discretionary incentive bonus and a stock option grant, as described under “Compensation Discussion and Analysis — Employment Agreements.” Mr. Goldstein’s 2011 employment agreement provides for an annual base salary and a grant of shares of restricted stock. Under his 2011 employment agreement, Mr. Goldstein is eligible to receive a discretionary cash bonus of 100% of his base salary, or $1,500,000, in respect of his 2011 performance, subject to the achievement of performance targets to be established in accordance with the Company’s management incentive plan.

 

Mr. Kay.  Mr. Kay’s employment agreement provides for an annual base salary and an annual cash bonus, as described under “Compensation Discussion and Analysis — Employment Agreements.” Pursuant to his employment agreement, Mr. Kay received a grant of options to purchase 100,000 shares of our Common Stock on January 1, 2009, which provided that options to purchase 5,000 shares, 12,500 shares, 21,666 shares, 28,333 shares, 20,833 shares and 11,668 shares were to vest on the first, second, third, fourth, fifth and sixth anniversaries of the date of grant, respectively. Accordingly, options to purchase 5,000 shares vested on January 1, 2010. In January 2010, the Company amended the terms of Mr. Kay’s employment agreement and option grant so that (a) an additional 20,000 options were deemed retroactively vested as of January 1, 2010 resulting in a cumulative total of 25,000 options being vested as of that date and (b) the remaining 75,000 options vest in equal installments of 25,000 options each on January 1, 2011, 2012 and 2013.

 

Mr. Arasi.  Mr. Arasi’s employment agreement provided for an annual base salary, an annual bonus, with a bonus opportunity of 50% of his base salary as determined in the Company’s sole discretion and stock option grants, as described under “Compensation Discussion and Analysis — Employment Agreements.” Pursuant to his employment agreement, Mr. Arasi received a grant of options to purchase 150,000 shares of our Common Stock on August 3, 2009, 75,000 of which vested on August 3, 2010. The remaining 75,000 options were scheduled to vest on August 3, 2011; however, the vesting of these options was accelerated in connection with Mr. Arasi’s resignation from the Company as further described under “Potential Payments Upon Termination or Change in Control.” Mr. Arasi also received a grant of options to purchase 150,000 shares of our Common Stock on August 3, 2010, 75,000 of which were scheduled to vest on each of August 3, 2011 and 2012. This grant of options will be forfeited upon Mr. Arasi’s resignation from the Company.

 

Mr. Jacobs.  Mr. Jacobs’s employment was terminated on July 23, 2010. He did not receive a bonus in respect of his 2010 performance.

 

For additional information about the employment agreements, see “Compensation Discussion and Analysis — Elements of Executive Officer Compensation — Employment Agreements” and “— Potential Payments Upon Termination or Change in Control.”

Outstanding Equity Awards at 2010 Fiscal Year-End

 

The following table sets forth information concerning stock options and shares of restricted stock held by the named executive officers at December 31, 2010.

 

 

 

 

 

Option Exercises and Stock Vested in 2010

 

The following table sets forth information concerning the exercise of stock options and the vesting of restricted stock awards by the named executive officers during 2010.

 

 

 

Potential Payments Upon Termination or Change in Control

 

Employment Agreements

 

The employment agreements and other arrangements for the named executive officers provide for payments and the continuation of benefits upon certain terminations of employment or if there is a change in control of the Company. All payments under the executive employment agreements or other arrangements in connection with a termination of employment are subject to the applicable named executive officer’s agreement to release the Company from all claims relating to his employment and the termination of his employment. The applicable named executive officer also may be subject to covenants restricting his ability to compete with the Company or to hire Company employees for a specified period following termination of employment.

 

Mr. Adelson

 

In the event of a termination of Mr. Adelson’s employment for cause (as defined below) or his voluntary termination (other than for good reason (as defined below)), all of his salary and benefits will immediately cease (subject to any requirements of law).

 

In the event of a termination of Mr. Adelson’s employment by us without cause or a voluntary termination by Mr. Adelson for good reason (as defined below) other than during the two year period following a change in control (as defined below), we will be obligated to pay or provide Mr. Adelson with:

 

 

In the event of a termination of Mr. Adelson’s employment by us without cause, a termination by Mr. Adelson for good reason within the two-year period following a change in control or Mr. Adelson’s voluntary termination at any time during the one-year period following a change in control, we will be obligated to pay or provide Mr. Adelson with:

 

 

However, if the change in control does not satisfy the definition of a change in the ownership or effective control of a corporation or a change in the ownership of a substantial portion of the assets of a corporation, pursuant to Section 409A of the Code, then the payment of two times salary plus base bonus will be paid ratably for the

remainder of the term of the employment agreement and the pro rata annual bonus for the year of termination will be paid at the same time annual bonuses would normally be paid to other executive officers of the Company.

 

In the case of a termination of Mr. Adelson’s employment due to his death or disability (as defined in his employment agreement), Mr. Adelson (or his estate) will be entitled to receive:

 

 

If Mr. Adelson terminates his employment on or after the last day of a fiscal year but before the actual grant date of the restricted stock award for that fiscal year, he will be granted a fully vested award for that fiscal year on the date the award would have otherwise been made (and subject to the applicable performance target being achieved) equal to the number of shares he would have been awarded multiplied by the following applicable percentage:

 

 

All payments under Mr. Adelson’s employment agreements in connection with a termination of employment are subject to Mr. Adelson’s agreement to release the Company from all claims relating to his employment and the termination of his employment. In addition, Mr. Adelson is subject to covenants restricting his ability to compete with the Company or to hire Company employees for a specified period following termination of his employment.

 

Definitions.  The terms “cause,” “good reason” and “change in control” are defined in Mr. Adelson’s employment agreement as follows:

 

Mr. Adelson may be terminated by the Company for “cause” if:

 

 

Mr. Adelson may terminate his employment with the Company for “good reason” if:

 

 

 

A “change in control” occurs upon:

 

 

Mr. Leven

 

In the event that Mr. Leven’s employment is terminated by the Company (other than for cause as defined in his 2009 and 2011 employment agreements and below) or by reason of his death or disability or if Mr. Leven terminates his employment for good reason (as defined in his 2009 and 2011 employment agreements and below), then he will be entitled to receive:

 

(a) under his 2009 employment agreement:

 

 

 

(b) under his 2011 employment agreement:

 

 

In addition, if (a) Mr. Leven’s employment is terminated prior to the expiration of the term of his agreement because the Company discharges him (other than for cause), (b) he terminates his employment for good reason (as defined in the agreement and below), (c) his employment is terminated due to his death or disability, (d) his employment terminates by reason of expiration of the term of the agreement, or (e) there is a change in control of the Company (as defined in Mr. Leven’s 2009 and 2011 employment agreements and below), then:

 

(a) under his 2009 employment agreement, each stock option to purchase shares of our Common Stock provided for in his 2009 employment agreement will immediately become fully vested and exercisable and remain outstanding through its originally scheduled expiration date; and

 

(b) under his 2011 employment agreement, the restricted shares of Common stock provided for in his 2011 employment agreement will immediately become fully vested and the restrictions on the restricted shares shall lapse.

 

Definitions.  The terms “cause,” “good reason” and “change in control” are defined in Mr. Leven’s 2009 and 2011 employment agreements as follows:

 

Mr. Leven may be terminated by the Company for “cause” if the Board, at a duly noticed meeting, has determined that one or more of the following events has occurred:

 

 

Mr. Leven may terminate his employment with the Company for “good reason” if:

 

 

 

Mr. Goldstein

 

In the event that Mr. Goldstein’s employment is terminated by the Company for cause (as defined in his 2009 and 2011 employment agreements and below), then pursuant to his 2009 and 2011 employment agreements, Mr. Goldstein will be entitled to receive:

 

 

In the event that Mr. Goldstein’s employment is terminated by the Company without cause (and other than due to death or disability), then pursuant to his 2009 and 2011 employment agreements, Mr. Goldstein will be entitled to receive:

 

 

In the event that Mr. Goldstein terminates his employment with the Company due to a change in control (as defined in the employment agreement for Mr. Adelson described above), then pursuant to his 2009 and 2011 employment agreements he will be entitled to receive:

 

 

In the event that Mr. Goldstein voluntarily terminates his employment with the Company, he shall be entitled to receive:

 

 

In the event Mr. Goldstein’s employment with the Company is terminated due to his death or disability, then pursuant to his 2009 and 2011 employment agreements, Mr. Goldstein or his estate, as the case may be, shall be entitled to receive:

 

 

Mr. Goldstein’s 2009 employment agreement provided that in the event his employment with the Company was terminated due to his death or disability, Mr. Goldstein or his estate, as the case may be, would be entitled to receive accelerated vesting of all equity awards under his 2004 and 2009 employment agreements such that the portion of each such award that would have vested during the twelve month period following the date of termination had he remained employed during that period would be immediately vested as of the date of termination. Mr. Goldstein’s 2011 employment agreement provides that in the event that Mr. Goldstein’s employment terminates due to his death or disability during the 2012 calendar year, he or his estate, as the case may be, shall be entitled to receive accelerated vesting of a portion of the restricted shares of Common Stock granted to him under his 2011 employment agreement such that the pro-rata portion of such award that would have vested through the date of termination (calculated on a straight line basis based on the number of days in the 2012 calendar year prior to the date of termination) shall be immediately vested as of the date of termination;

 

Mr. Goldstein’s 2009 employment agreement also provided that in the event that Mr. Goldstein voluntarily terminated his employment with the Company due to Sheldon G. Adelson not serving as Chief Executive Officer of the Company and Chairman of the Board, he would be entitled to receive:

 

 

In addition, if Mr. Goldstein remains continuously employed with the Company through December 31, 2011, then upon termination of his employment with the Company at or following that date, Mr. Goldstein shall be entitled to receive accelerated vesting of all of his awards of stock options and restricted stock that were outstanding as of July 10, 2009.

 

Definitions.  The term cause” is defined in Mr. Goldstein’s 2009 and 2011 employment agreements as follows:

 

Mr. Goldstein may be terminated by the Company for “cause” if the Board, at a duly noticed meeting, has determined that one or more of the following events has occurred:

 

 

 

Mr. Kay

 

In the event of a termination of Mr. Kay’s employment for cause (as defined in his employment agreement and below) or a voluntary termination by Mr. Kay (other than for good reason (as defined in his employment agreement and below)), all salary and benefits will immediately cease (subject to any requirements of law).

 

In the event of a termination of Mr. Kay’s employment by the Company without cause or a voluntary termination by Mr. Kay for good reason, the Company will be obligated to pay or provide Mr. Kay with:

 

 

 

In the case of a termination of Mr. Kay’s employment due to his death or disability (as defined in his employment agreement), he will be entitled to receive the following:

 

 

Definitions.  The terms “cause,” “good reason” and “change in control” are defined in Mr. Kay’s employment agreement as follows:

 

Mr. Kay may be terminated by the Company for “cause” if:

 

 

 

Mr. Kay may terminate his employment with the Company for “good reason” if:

 

 

Under Mr. Kay’s employment agreement, a “change of control” occurs if Sheldon G. Adelson and the estate planning trusts of Sheldon G. Adelson identified at the effective date of Mr. Kay’s employment agreement in the most recent filing with the Securities and Exchange Commission (the “SEC”) (including any amendments, revisions, conversions, substitutions or otherwise of such trusts) control less than 50% of the voting equity of the Company; provided that a “change of control” ceases to constitute “good reason” unless Mr. Kay gives notice to the Company that he is terminating his employment with the Company due to the “change of control” within 30 days after the first filing is made with the SEC by which the fact of such “change of control” could be determined. For purpose of the preceding sentence, Mr. Kay shall be considered to have determined the existence of a “change of control” on the date of the SEC filing if the filing announces a transaction that has occurred or on the date that a prospective transaction closes.

 

Mr. Arasi

 

In the event of a termination of Mr. Arasi’s employment for cause (as defined in his employment agreement and below) or a voluntary termination by Mr. Arasi (other than for good reason (as defined in his employment agreement and below)), he shall be entitled to:

 

 

In the event of a termination of Mr. Arasi’s employment by the Company without cause or a voluntary termination by Mr. Arasi for good reason, the Company will be obligated to pay or provide Mr. Arasi with:

 

 

 

In the case of a termination of Mr. Arasi’s employment due to his disability (as defined in his employment agreement), he will be entitled to receive the following:

 

 

Definitions.  The terms “cause,” “good reason” and “material breach” are defined in Mr. Arasi’s employment agreement as follows:

 

“Cause” means:

 

 

 

“Good Reason” means:

 

 

provided, however, that “Good Reason” shall not be deemed to occur solely as a result of a transaction in which the Company becomes a subsidiary of another company, so long as Mr. Arasi’s duties and responsibilities of office are not materially changed as they relate solely to the Company and, provided further, that Mr. Arasi may not terminate employment for Good Reason, unless (i) he gives written notice to the Company that Good Reason has occurred, which notice includes a reasonably detailed description of the alleged grounds for termination, and that he has elected to resign, and (ii) the Company has not cured such act or omission prior to the expiration of the 30 day period after delivery of such notice, in which case, his employment shall terminate 30 days after delivery of such notice.

 

“Material Breach” means an act or omission of Mr. Arasi’s not otherwise specified in the definition of “Cause” set forth above, which is (i) dishonest and relates to Mr. Arasi’s employment by the Company resulting in direct or indirect personal gain or enrichment at the expense of the Company or any of its affiliates; (ii) likely to cause a material adverse effect on the business of the Company or any of its affiliates; or (iii) serious and bad faith willful misconduct (including disclosure of confidential information) that is likely to cause a material adverse effect on the business of the Company or any of its affiliates.

 

Mr. Jacobs

 

In the event of a termination of Mr. Jacobs’s employment for cause, all salary and benefits will immediately cease (subject to any requirements of law). Mr. Jacobs’s employment was terminated for cause on July 23, 2010. He did not receive any payments relating to his termination.

 

2004 Equity Award Plan

 

In the event of a change in control (as defined above in the definition of change in control in the employment agreements for Messrs. Adelson, Goldstein and Leven and in the 2004 Equity Award Plan), if our Compensation Committee so determines:

 

 

In addition, performance compensation awards shall vest based on the level of attainment of the performance goals as determined by the Compensation Committee.

Potential Payments/Benefits Upon Termination of Employment for 2010

 

The table below sets forth information about the potential payments and benefits our executive officers who were employed by the Company on December 31, 2010 may receive under their employment agreements upon the termination of their employment with the Company. The amounts shown in the table below are estimates of the payments that each executive officer would receive in certain instances assuming a hypothetical employment termination date of December 31, 2010. The amounts actually payable will be determined only upon the termination of employment of each executive officer, taking into account the facts and circumstances surrounding the executive officer’s termination of employment.

 

The information in the table assumes that:

 

 

 

 

 

 

Since our initial public offering in 2004, each non-employee director has received an annual cash retainer of $50,000 and an annual grant of restricted stock equal in value to $50,000. The restricted stock is subject to a one year forfeiture period and may not be sold until the director retires from the Board (except to the extent necessary to cover taxes incurred as a result of the vesting of the restricted stock). In 2010, Messrs. Ader, Chafetz, Forman, Koo, Schwartz and Siegel each received 2,005 shares of restricted stock. In addition, each non-employee director receives a one time grant of options upon becoming a non-employee director with an aggregate value of $100,000 on the date of grant (based on the Black-Scholes option valuation model). The stock options vest in five equal installments on each of the first five anniversaries of the date of grant. Both the restricted stock grants and the options are granted to the directors pursuant to our 2004 Equity Award Plan.

 

We pay non-employee directors $1,500 for each meeting of the Board that they attended ($750 for telephonic meetings). We pay non-employee directors who are members of the Audit Committee or the Compensation Committee $1,000 for each committee meeting that they attended ($500 for telephonic meetings). During 2010, we paid an annual retainer of $20,000 to the chairperson of the Audit Committee and an annual retainer of $5,000 to the chairperson of the Compensation Committee.

 

Effective April 1, 2011, each non-employee director will receive an annual cash retainer of $75,000 and an annual grant of restricted stock equal in value to $75,000. The Chairman of the Audit Committee will receive an annual retainer of $50,000 and each member of the Audit Committee will receive an annual retainer of $15,000. The Chairman of the Compensation Committee will receive an annual retainer of $15,000 and each member of the Compensation Committee will receive an annual retainer of $5,000.

 

Non-employee directors may defer cash compensation payments into a deferred compensation plan. None of these payments have been deferred to date. Non-employee directors are also reimbursed for expenses incurred in connection with their service as directors, including travel expenses for meeting attendance.

 

Beginning in 2006, the Compensation Committee retained HVS Executive Search for advice on compensation-related matters, including a review of director compensation. HVS Executive Search provided advice on director compensation during 2011. The Compensation Committee may, in its discretion, seek the advice of our chief executive officer or any of our other executive officers, in determining or recommending the amount or form of compensation for our outside directors.

2010 Director Compensation Table

 

The following table describes the compensation arrangements with our non-employee directors for 2010.

 

 

 

 

The following table shows certain information with respect to our 2004 Equity Award Plan as of December 31, 2010: