What is the primary purpose of the amendment to the stock incentive plan?

The primary purpose is to provide participants, specifically those with vested Deferred Bonus Stock and Deferred Stock Contract awards, the option to elect an earlier distribution of their shares. This election is available for a limited period within 2005, with shares being issued in the first quarter of 2006.

Does this amendment allow executives to receive their stock awards sooner regardless of vesting schedules?

No, the amendment allows for accelerated distribution of shares that have already vested. It does not alter the underlying vesting schedule for the awards themselves. Furthermore, participants who elect to accelerate are still subject to the company's existing stock ownership guidelines.

What is the significance of the increased share repurchase authorization?

The increase in share repurchase authorization by 25 million shares, bringing the total to approximately 28.8 million (about 13% of outstanding Class A Common Stock), signals the company's intent to return value to shareholders. It provides flexibility for the company to potentially buy back a significant portion of its stock, which can support the stock price and increase earnings per share.

How can Marriott repurchase these shares?

The company can purchase the shares through open market transactions or privately negotiated transactions, providing flexibility in executing its buyback strategy.

MAR 8-K: Material Agreements

Summary

Marriott International, Inc. (MAR) filed an 8-K on August 8, 2005, reporting two key board actions taken on August 4, 2005. Firstly, the company's Board of Directors amended its 2002 Comprehensive Stock and Cash Incentive Plan. This amendment allows participants to elect, within a limited 2005 timeframe, to accelerate the distribution of shares for vested Deferred Bonus Stock and Deferred Stock Contract awards. While vesting schedules remain unchanged, elected accelerations will result in share issuance in the first quarter of 2006. Importantly, this acceleration does not exempt participants from the company's existing stock ownership guidelines, which current named executive officers have met. Secondly, the Board significantly increased the authorization for the repurchase of the company's Class A Common Stock by 25 million shares. This brings the total outstanding repurchase authorization to approximately 28.8 million shares, representing about 13% of the company's outstanding Class A Common Stock. These repurchases can be executed through open market or privately negotiated transactions. These actions suggest potential shareholder value enhancement through both executive compensation adjustments and a strengthened share buyback program.

Key Highlights

1Marriott's Board amended the 2002 Comprehensive Stock and Cash Incentive Plan to allow accelerated share distribution for certain vested awards.
2Participants can elect to accelerate share distribution during a limited window in 2005.
3Accelerated shares will be issued in Q1 2006; future vesting dates remain unaffected.
4The amendment does not waive existing stock ownership guidelines for executives.
5The Board authorized an additional 25 million shares for common stock repurchases.
6Total outstanding share repurchase authorization increased to approximately 28.8 million shares.
7The repurchase authorization represents roughly 13% of outstanding Class A Common Stock.

MARRIOTT INTERNATIONAL INC /MD/ 8-K Report, Material Agreement (Aug 8, 2005)

Summary

Key Highlights

Frequently Asked Questions