* Dubai World, MGM agree to CityCenter terms

* Dubai World withholds $35 mln CityCenter payment

* Bondholders float restructuring plan

* Shares close with 6.8 percent gain (Adds Icahn comments, CityCenter details)

By Deena Beasley

LOS ANGELES, April 17 (Reuters) - A plan for the restructuring of MGM Mirage (MGM.N: Quote, Profile, Research), suggested by investor Carl Icahn, would involve swapping debt for equity and be done in concert with Kirk Kerkorian, MGM's majority shareholder, a source familiar with the situation said on Friday.

Another source said MGM and Dubai World have agreed to a set of terms that would ensure the completion of CityCenter, their jointly owned project on the Las Vegas Strip. The deal has yet, however, to be approved by banks providing financing.

"This is a three-way negotiation," the source said. "Banks are being asked to amend terms" of a $1.8 billion facility slated to become available in June.

The agreement does not involve bringing in another partner for the $8.7 billion project, the source said.