This excerpt taken from the MRO DEF 14A filed Mar 10, 2005.
Long-Term Incentive PlansAwards in Last Fiscal Year
To emphasize the long-term nature of the awards, vesting decisions are based on three-year average operational and financial performance, as compared with three-year peer-group performance as described in the Compensation Committee Report. In the event of a change of control of the Company, all performance shares would immediately vest at target levels.
Dividends are paid on all unvested shares.
The Compensation Committee (the "Committee") of Marathon Oil Corporation sets policies and administers programs regarding compensation for Marathon's executive officers and regularly reports its actions to the Board. In addition, the Committee reviews and approves the compensation of the Marathon Ashland Petroleum LLC ("MAP") officers on behalf of the MAP Board of Managers. The Committee is comprised only of independent, non-employee directors. The members who served on the committee are Mr. Yearley, Mr. Davis, Dr. Jackson, Mr. Lader, Mr. Reilley, and Mr. Schofield.
The purpose of this report is to summarize the philosophy, compensation components and specific program objectives that are considered by the Committee when making decisions regarding compensation for Marathon officers.