MGM Resorts International amended its voting agreement with People Incorporated, formerly IAC, and Barry Diller, changing how their holdings may grow and how they can be voted. The amendment also limits MGM’s ability to adopt defensive measures aimed specifically at them while they comply with the agreement.
The changes add constraints on People and Diller’s share purchases and voting rights, while setting conditions for their support of a company sale. The underlying agreement, signed April 3, 2026, otherwise remains in effect.
Key details
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A 29.9% cap on additional acquisitions: People, Diller and their controlled affiliates may not acquire MGM shares or related derivatives if the purchase would take their combined beneficial ownership above 29.9% of MGM’s outstanding common stock.
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An exception if MGM reduces its share count: Their ownership could rise above 29.9% because of MGM repurchases, redemptions or other acquisitions of its own securities. If that happens, they may not make further acquisitions while above the threshold.
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Voting limits on routine stockholder matters: For matters other than a change-of-control transaction, they must vote any securities representing voting power above 25.73% in line with the majority of votes cast by other stockholders. The comparison excludes votes held by People and Diller, MGM directors and executive officers, and their controlled affiliates. Securities that are not voted are disregarded.
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Conditions on their votes in a sale or change of control: They must follow the MGM board’s recommendation on a change-of-control vote only if several conditions are met:
- People-designated directors serve on the board’s transaction committee, unless they decline or a legal conflict prevents them from serving.
- The buyer is unaffiliated with MGM, its controlled affiliates, and its directors and executive officers.
- People and Diller receive the same form and amount of consideration per share, and the same terms, as other holders of the same class, unless they agree otherwise. If their consideration includes securities, MGM must use commercially reasonable efforts to provide liquidity opportunities for those securities.
- The transaction does not impose new or additional restrictions on People and Diller relating to the surviving, resulting or acquiring company.
If any condition is unmet, the amendment does not restrict how they vote on that transaction.
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Limits on targeted defensive actions by MGM: While People and Diller comply with the agreement, MGM may not implement a stockholder rights plan or other defensive action primarily intended to harm them, or that MGM knows would disadvantage them disproportionately compared with other holders of the same class. This restriction does not cover MGM’s responses to a proxy contest or other contested solicitation involving People or Diller, or actions directed at a third party that buys or agrees to buy a significant portion of their voting shares. They must notify MGM before completing such a sale.
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Clarification of what counts as a change of control: For purposes of ending the voting agreement, People and Diller acquiring voting securities with a majority of MGM’s total voting power—alone or as part of a group, in one transaction or a series—will not by itself count as a change of control. It would count only if MGM’s board specifically approves that designation under the agreement.
Plain-English implications
The amendment constrains both sides: it limits how far People and Diller can build their stake and how they can vote above a specified level, while restricting certain defensive actions MGM could take against them. Their obligation to follow the board’s recommendation in a sale is conditional, rather than automatic, and does not apply if the stated protections are not met.