UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) | February 17, 2006 |
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FelCor Lodging Trust Incorporated |
(Exact name of registrant as specified in its charter) |
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Maryland | 001-14236 | 75-2541756 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
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545 E. John Carpenter Frwy., Suite 1300 Irving, Texas | | 75062 |
(Address of principal executive offices) | | (Zip Code) |
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Registrant’s telephone number, including area code | (972) 444-4900 |
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(Former name or former address, if changed since last report.) |
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act |
| (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act |
| (17 CFR 240.13e-4(c)) | |
Section 1 – Registrant’s Business and Operations
Item 1.01 Entry into a Material Definitive Agreement. |
On February 17, 2006, the Compensation Committee, or Committee, of the Board of Directors of FelCor Lodging Trust Incorporated, or the Company, established the performance goals for 2006 cash bonus compensation to the executive officers and other employees of the Company. The performance goals were reviewed and confirmed by the full Board of Directors on February 21, 2006. The 2006 performance criteria are based upon corporate and individual objectives. For the corporate objective, the Company must achieve specific levels of Funds From Operations, or FFO, per share. A summary of the performance criteria for 2006 is attached as an exhibit to this Current Report as Exhibit 10.38 and is incorporated herein by reference. The 2006 performance criteria in general are substantially the same as the performance criteria adopted for 2005, except that the specific targets and goals to be achieved have been determined based on the Company’s budget for 2006 as recently approved by the Board of Directors.
As a result of the recently approved 2006 budget and the finalization of the performance goals for 2006, the Committee also on February 17, 2006, awarded the Company’s executive officers and other employees, from one or more of the Company’s Restricted Stock and Stock Option Plans, a grant of shares of restricted common stock of the Company. The awards replace and supercede in their entirety the awards previously authorized by the Committee on February 1, 2006. No shares of restricted stock were issued and no restricted stock grant contracts were delivered under that prior authorization. The shares were awarded based on a percentage of the base compensation of the executive officer (200% for the chief executive officers, 100% for executive vice presidents, and 80% for senior vice presidents), divided by the closing sales price of the Company’s common stock on February 17, 2006, the Grant Date, rounded up or down to the nearest 1,000 shares. Under the terms of the restricted stock grant contracts, each grant of restricted shares will be subject to both time-based and performance-based vesting criteria on substantially the same basis as adopted by the Committee in 2005 and previously reported in the Form 8-K Current Report dated April 26, 2005 and filed May 2, 2005. With respect to the 50% of the granted shares that are also subject to performance-based criteria, or Performance Criteria, the Committee adopted Performance Criteria for 2006 based on the achievement by the Company of a minimum level of growth in FFO per share, and a minimum level of growth in total return to common shareholders, including appreciation and dividends. Each of the objectives is weighted equally. In measuring the Company’s performance against these Performance Criteria, the Committee will review each of these measures independently.
Any performance-based shares that fail to vest as a result of the failure to satisfy any Performance Criteria may still vest if, at the end of the four-year vesting period, the Company satisfies separate performance criteria established by the Compensation Committee. For performance-based shares awarded in 2006, the Committee established criteria based upon the achievement of a cumulative, compounded total return to common shareholders over the four-year vesting period. If the Company achieves this objective, any 2006 performance-based shares that had not vested, as a result of the failure to satisfy any Performance Criteria, will vest on the fourth anniversary of the Grant Date. If the Company fails to achieve this objective, then those unvested shares will be forfeited and the executive will have no further rights to those shares (including the right to vote those shares or to receive dividends). The restricted stock awards and the related Performance Criteria were reviewed and confirmed by the full Board of Directors on February 21, 2006.
Section 9 – Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits. |
(a) | Financial statements of businesses acquired. |
(b) | Pro forma financial information. |
The following exhibits are furnished in accordance with the provisions of Item 601 of Regulation S-K:
Exhibit Number | Description of Exhibit |
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10.38 | Summary of 2006 Performance Criteria for Annual Incentive Bonus Award Program. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
FELCOR LODGING TRUST INCORPORATED
Date: February 21, 2006 | By: | /s/ Lawrence D. Robinson |
| Name: | Lawrence D. Robinson | |
| Title: | Executive Vice President, | |
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General Counsel and Secretary
INDEX TO EXHIBITS
Exhibit Number | Description of Exhibit |
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10.38 | Summary of 2006 Performance Criteria for Annual Incentive Bonus Award Program. |
