{"id":38770,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/deferred-management-incentive-compensation-plan-lockheed-martin2.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"deferred-management-incentive-compensation-plan-lockheed-martin2","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/deferred-management-incentive-compensation-plan-lockheed-martin2.html","title":{"rendered":"Deferred Management Incentive Compensation Plan &#8211; Lockheed Martin Corp."},"content":{"rendered":"<pre>\n                           LOCKHEED MARTIN CORPORATION\n                           ---------------------------\n\n                          DEFERRED MANAGEMENT INCENTIVE\n                          -----------------------------\n                                COMPENSATION PLAN\n                                -----------------\n                             (Adopted July 27, 1995)\n                            As Amended August 1, 1998\n\n                            As Amended June 28, 2001\n\n                                    ARTICLE I\n                                    ---------\n\n                              PURPOSES OF THE PLAN\n                              --------------------\n\n                  The purposes of the Lockheed Martin Corporation Deferred\nManagement Incentive Compensation Plan (the \"Deferral Plan\") are to provide\ncertain key management employees of Lockheed Martin Corporation and its\nsubsidiaries (the \"Company\") the opportunity to defer receipt of Incentive\nCompensation awards under the Lockheed Martin Corporation Management Incentive\nCompensation Plan (the \"MICP\") and to encourage key employees to maintain a\nfinancial interest in the Company's performance. Except as expressly provided\nhereinafter, the provisions of this Deferral Plan and the MICP shall be\nconstrued and applied independently of each other.\n\n                  The Deferral Plan applies solely to MICP awards and expressly\ndoes not apply to any special awards which may be made under any of the\nCompany's other incentive plans, except and to the extent specifically provided\nunder the terms of such other incentive plans and the relevant awards.\n\n                                   ARTICLE II\n                                   ----------\n\n                                   DEFINITIONS\n                                   -----------\n\n                  Unless the context indicates otherwise, the following words\nand phrases shall have the meanings hereinafter indicated:\n\n                  1. ACCOUNT -- The bookkeeping account maintained by the\nCompany for each Participant which is credited with the Participant's Deferred\nCompensation and earnings (or losses) attributable to the investment options\nselected by the Participant, and which is debited to reflect distributions and\nforfeitures; the portions of a Participant's Account allocated to different\ninvestment options will be accounted for separately.\n\n                  2. ACCOUNT BALANCE -- The total amount credited to a\nParticipant's Account at any point in time, including the portions of the\nAccount allocated to each investment option.\n\n                  3. AWARD YEAR -- The calendar year with respect to which an\nEligible Employee is awarded Incentive Compensation.\n\n\n\n\n\n                  4. BENEFICIARY -- The person or persons (including a trust or\ntrusts) validly designated by a Participant, on the form provided by the\nCompany, to receive distributions of the Participant's Account Balance, if any,\nupon the Participant's death. In the absence of a valid designation, or if the\ndesignated Beneficiary has predeceased the Participant, the Beneficiary shall be\nthe person or persons entitled by will or the laws of descent and distribution\nto receive the amounts otherwise payable to the Participant under this Deferral\nPlan; a Participant may amend his or her Beneficiary designation at any time\nbefore the Participant's death.\n\n                  5. BOARD -- The Board of Directors of Lockheed Martin\nCorporation.\n\n                  6. COMMITTEE -- The committee described in Section 1 of\nArticle VIII.\n\n                  7. COMPANY -- Lockheed Martin Corporation and its\nsubsidiaries.\n\n                  8. COMPANY STOCK INVESTMENT OPTION -- The investment option\nunder which the amount credited to a Participant's Account will be based on the\nmarket value and investment return of the Company's Common Stock.\n\n                  9. DEFERRAL AGREEMENT -- The written agreement executed by an\nEligible Employee on the form provided by the Company under which the Eligible\nEmployee elects to defer Incentive Compensation for an Award Year.\n\n                  10. DEFERRAL PLAN -- The Lockheed Martin Corporation Deferred\nManagement Incentive Compensation Plan, adopted by the Board on July 27, 1995,\nand as amended from time to time.\n\n                  11. DEFERRED COMPENSATION -- The amount of Incentive\nCompensation credited to a Participant's Account under the Deferral Plan for an\nAward Year.\n\n                  12. ELIGIBLE EMPLOYEE -- An employee of the Company who is a\nparticipant in the MICP and who has satisfied such additional requirements for\nparticipation in this Deferral Plan as the Committee may from time to time\nestablish. In the exercise of its authority under this provision, the Committee\nshall limit participation in the Plan to employees whom the Committee believes\nto be a select group of management or highly compensated employees within the\nmeaning of Title I of the Employee Retirement Income Security Act of 1974, as\namended.\n\n                  13. EXCHANGE ACT -- The Securities Exchange Act of 1934.\n\n\n                                       - 2 -\n\n\n\n                  14. INCENTIVE COMPENSATION -- The MICP amount granted to an\nemployee for an Award Year.\n\n                  15. INTEREST OPTION -- The investment option under which\nearnings will be credited to a Participant's Account based on the interest rate\napplicable under Cost Accounting Standard 415, Deferred Compensation.\n\n                  16. MICP -- The Lockheed Martin Corporation Management\nIncentive Compensation Plan.\n\n                  17. PARTICIPANT -- An Eligible Employee for whom Incentive\nCompensation has been deferred for one or more years under this Deferral Plan;\nthe term shall include a former employee whose Deferred Compensation has not\nbeen fully distributed.\n\n                  18. PAYMENT DATE -- Means, as to any Participant, the January\n15 or July 15 on or about on which payment to the Participant is to begin in\naccordance with the Participant's election made pursuant to Section 2 of Article\nV.\n\n                  19. SECTION 16 PERSON -- A Participant who at the relevant\ntime is subject to the reporting and short-swing liability provisions of Section\n16 of the Securities Exchange Act of 1934.\n\n                  20. SUBSIDIARY -- Means, as to any person, any corporation,\nassociation, partnership, joint venture or other business entity of which 50% or\nmore of the voting stock or other equity interests (in the case of entities\nother than corporation), is owned or controlled (directly or indirectly) by that\nentity, or by one or more of the Subsidiaries of that entity, or by a\ncombination thereof.\n\n                  21. TRADING DAY -- A day upon which transactions with respect\nto Company Common Stock are reported in the consolidated transaction reporting\nsystem.\n\n\n                                   ARTICLE III\n                                   -----------\n\n                           ELECTION OF DEFERRED AMOUNT\n                           ---------------------------\n\n                  1. Timing of Deferral Elections. An Eligible Employee may\n                     ----------------------------\nelect to defer Incentive Compensation for an Award Year by executing and\ndelivering to the Company a Deferral Agreement no later than October 15 of the\nAward Year or such other date established by the Committee for an Award Year\nthat is not later than October 31 of that Award Year, provided that any election\nby a Section 16 Person shall be subject to the provisions of Section 4 of\nArticle IV. An employee who first qualifies as an Eligible Employee after\nSeptember 15 of an Award Year may elect to defer Incentive Compensation for that\nAward Year by entering into a Deferral Agreement up to thirty (30)\n\n\n\n                                       - 3 -\n\n\n\n\ndays after the date on which such employee first becomes a participant in the\nMICP. An Eligible Employee's Deferral Agreement shall be irrevocable when\ndelivered to the Company. Each Deferral Agreement shall apply only to amounts\ndeferred in that Award Year and a separate Deferral Agreement must be completed\nfor each Award Year for which an Eligible Employee defers Incentive\nCompensation.\n\n                  2. Amount of Deferral Elections. An Eligible Employee's\n                     ----------------------------\ndeferral election may be stated as:\n\n                     (a) a dollar amount which is at least $5,000 and is an even\n                  multiple of $1,000,\n\n                     (b) the greater of $5,000 or a designated percentage of the\n                  Eligible Employee's Incentive Compensation (adjusted to the\n                  next highest multiple of $1,000),\n\n                     (c) the excess of the Eligible Employee's Incentive\n                  Compensation over a dollar amount specified by the Eligible\n                  Employee (which must be an even multiple of $1,000), or\n\n                     (d) all of the Eligible Employee's Incentive Compensation.\n\nAn Eligible Employee's deferral election shall be effective only if the\nParticipant is awarded at least $10,000 of Incentive Compensation for that\nAward Year, and, in the case of a deferral election under paragraph (c) of this\nSection 2, only if the resulting excess amount is at least $5,000.\n\n                  3. Effect of Taxes on Deferred Compensation. The amount that\n                     ----------------------------------------\nwould otherwise be deferred and credited to an Eligible Employee's Account will\nbe reduced by the amount of any tax that the Company is required to withhold\nwith respect to the Deferred Compensation. The reduction for taxes shall be made\nproportionately out of amounts otherwise allocable to the Interest Option and\nthe Company Stock Investment Option.\n\n\n                                   ARTICLE IV\n                                   ----------\n\n                              CREDITING OF ACCOUNTS\n                              ---------------------\n\n                  1. Crediting of Deferred Compensation. Incentive\n                     ----------------------------------\nCompensation that has been deferred hereunder shall be credited to a\nParticipant's Account as of the day on which the Incentive Compensation would\nhave been paid to the Participant if no Deferral Agreement had been made.\n\n                  2. Crediting of Earnings. Earnings shall be credited to a\n                     ---------------------\nParticipant's Account based on the investment option or options to which the\nAccount has been allocated, beginning with the day as of which Deferred\nCompensation (or any reallocation under Section 4, 5, or 6 of Article IV) is\n\n\n                                       - 4 -\n\n\n\ncredited to the Participant's Account. Any amount distributed from a\nParticipant's Account shall be credited with earnings through the last day of\nthe month preceding the month in which a distribution is to be made pursuant to\nthe Participant's election as set forth in Article V. The earnings credited\nunder each of the investment options shall be determined as follows:\n\n                           (a) Interest Option: The portion of a Participant's\n                               ---------------\n                  Account allocated to the Interest Option shall be credited\n                  with interest, compounded monthly, at a rate equivalent to the\n                  then published rate for computing the present value of future\n                  benefits at the time cost is assignable under Cost Accounting\n                  Standard 415, Deferred Compensation, as determined by the\n                  Secretary of the Treasury on a semi-annual basis pursuant to\n                  Pub. L. 92-41, 85 Stat. 97.\n\n                           (b) Company Stock Investment Option: The portion of a\n                               -------------------------------\n                  Participant's Account allocated to the Company Stock\n                  Investment Option shall be credited as if such amount had been\n                  invested in the Company's Common Stock at the published\n                  closing price of the Company's Common Stock on the last\n                  Trading Day preceding the day as of which Deferred\n                  Compensation (or any reallocation under Section 4, 5, or 6 of\n                  Article IV) is credited to the Participant's Account; this\n                  portion of the Participant's Account Balance shall reflect any\n                  subsequent appreciation or depreciation in the market value of\n                  the Company's Common Stock based on the closing price of the\n                  stock on the New York Stock Exchange on the last Trading Day\n                  of each month and shall reflect dividends on the Company's\n                  Common Stock as if such dividends had been reinvested in the\n                  Company's Common Stock.\n\n                           (c) Interest Crediting For Late Payments:\n                               ------------------------------------\n                  Notwithstanding the investment option to which a Participant's\n                  Account has been allocated, in the event payment does not\n                  commence by the last day of the month in which the Payment\n                  Date occurs, earnings shall be credited on the Participant's\n                  entire Account from the last day of the month preceding the\n                  Payment Date to the last day of the month preceding the actual\n                  commencement of payment at the rate set forth under Section\n                  2(a) of this Article IV. Interest credited under this Section\n                  2(c) of this Article IV shall be paid on the date payment\n                  under the Plan first commences.\n\n                  3. Selection of Investment Options. Except as otherwise\n                     -------------------------------\nprovided in this Deferral Plan, a Participant's investment selections shall be\nmade as part of his or her Deferral Agreement for an Award Year and shall be\nirrevocable with respect to amounts deferred for that Award Year, and no\nsubsequent reallocations shall be made. At the time of entering into a Deferral\nAgreement for any subsequent Award Year, a Participant shall select the\ninvestment options for the Deferred Compensation to be credited to the\nParticipant's Account for that Award Year. A Participant's allocations\n\n\n                                       - 5 -\n\n\n\nbetween investment options shall be subject to such minimum allocations as the\nCommittee may establish.\n\n                  4. Special Rules for Section 16 Persons. Notwithstanding the\n                     ------------------------------------\nforegoing, an election by a Section 16 Person to have Deferred Compensation\nallocated to the Company Stock Investment Option shall be given effect only if\nirrevocably made at least six months prior to the effective date of the\nallocation. If a Section 16 Person's Deferral Agreement for an Award Year is\nentered into less than six months prior to the date that Deferred Compensation\nis credited for that Award Year, and if he or she has elected to have any\nportion of the Deferred Compensation for that Award Year allocated to the\nCompany Stock Investment Option, that portion shall initially be allocated to\nthe Interest Option and shall be reallocated and credited to the Company Stock\nInvestment Option as of the first day of the seventh month following the month\nin which the Deferral Agreement was made. An Eligible Employee who first becomes\na Section 16 Person after his or her Deferral Agreement has been entered into\nfor an Award Year shall be subject to the requirements of this Section 4, except\nthat such an Eligible Employee shall be permitted, within ten business days\nafter becoming a Section 16 Person, to make irrevocable modified investment\nelections for that Award Year; any allocations to the Company Stock Investment\nOption on behalf of such a Section 16 Person shall be deferred until the first\nday of the seventh month following the month in which the Eligible Employee's\nmodified election is made (or, if later, the first day of the seventh month\nfollowing the month in which the election period expires without a modified\nelection having been made).\n\n                  5. Reallocations to Company Stock Investment Option. Each\n                     ------------------------------------------------\nEligible Employee for whom an account is maintained under the Deferred\nManagement Incentive Compensation Plan of Lockheed Corporation and its\nSubsidiaries (the \"Lockheed Plan\") will be given a one-time opportunity during\ncalendar year 1996 to make an irrevocable election to have all or a portion of\nthat account balance credited to the Eligible Employee's Account under this\nDeferral Plan and reallocated to the Company Stock Investment Option. That\nreallocation shall be credited to the Participant's Account under this Deferral\nPlan as of the first day of the month following the last month in which such\nelections are permitted, but in the case of a Section 16 Person not earlier than\nthe first day of the seventh month after the month in which the election is\ndelivered to the Company. If such a reallocation is made, the Eligible\nEmployee's right to receive benefits under the Lockheed Plan will be reduced\naccordingly, and the Company will be released from liability under the\nLockheed Plan for the amount reallocated. Although the terms of this Deferral\nPlan shall generally apply to any amount so reallocated, the Eligible Employee's\nirrevocable payment elections under the Lockheed Plan will continue to apply to\nthe reallocated amount.\n\n                  6. Reallocations to Interest Option. If benefit payments to a\n                     --------------------------------\nParticipant or Beneficiary are to be paid or commenced to be paid over a period\nthat extends more than six months after the date of the Participant's\ntermination of employment with the Company or death, the Participant or\n\n\n                                       - 6 -\n\n\n\nBeneficiary, as applicable, may elect irrevocably at any time after the\nParticipant's termination of employment or death and before the commencement of\nbenefit payments to have the portion of the Participant's Account that is\nallocated to the Company Stock Investment Option reallocated to the Interest\nOption. A reallocation under this Section 6 shall take effect as of the first\nday of the month following the month in which an executed reallocation election\nis delivered to the Company, but in the case of a Section 16 Person not earlier\nthan the first day of the seventh month following the month in which the\nreallocation election is delivered to the Company.\n\n\n                                    ARTICLE V\n                                    ---------\n\n                               PAYMENT OF BENEFITS\n                               -------------------\n\n                  1. General. The Company's liability to pay benefits to a\n                     -------\nParticipant or Beneficiary under this Deferral Plan shall be measured by and\nshall in no event exceed the Participant's Account Balance. Except as otherwise\nprovided in this Deferral Plan, a Participant's Account Balance shall be paid to\nhim in accordance with the Participant's elections under Sections 2 and 3 of\nthis Article, and such elections shall be continuing and irrevocable. All\nbenefit payments shall be made in cash and, except as otherwise provided, shall\nreduce allocations to the Interest Option and the Company Stock Investment\nOption in the same proportions that the Participant's Account Balance is\nallocated between those investment options at the end of the month preceding the\ndate of distribution. Notwithstanding the foregoing, no amount shall be\ndistributed to a Section 16 Person under this Deferral Plan unless the amount\nwas allocated to the Participant's Account at least six months prior to the date\nof distribution or no portion of the amount was allocated to the Company Stock\nInvestment Option.\n\n                  2. Election for Commencement of Payment. At the time a\n                     ------------------------------------\nParticipant first completes a Deferral Agreement, he or she shall elect from\namong the following options governing the date on which the payment of benefits\nshall commence:\n\n                           (A)      Payment to begin on or about the January\n                                    15th or July 15th next following the date of\n                                    the Participant's termination of employment\n                                    with the Company for any reason.\n\n                           (B)      Payment to begin on or about January 15th of\n                                    the year next following the year in which\n                                    the Participant terminates employment with\n                                    the Company for any reason.\n\n                           (C)      Payment to begin on or about the January\n                                    15th or July 15th next following the date on\n                                    which the Participant has both terminated\n                                    employment with the Company for\n\n\n                                       - 7 -\n\n\n\n                                    any reason and attained the age designated\n                                    by the Participant in the Deferral\n                                    Agreement.\n\n                  3. Election for Form of Payment.  At the time a\n                     ----------------------------\nParticipant first completes a Deferral Agreement, he or she shall elect the form\nof payment of his or her Account Balance from among the following options:\n\n                           (A)      A lump sum.\n\n                           (B)      Annual payments for a period of years\n                                    designated by the Participant which shall\n                                    not exceed fifteen (15). The amount of each\n                                    annual payment shall be determined by\n                                    dividing the Participant's Account Balance\n                                    at the end of the month prior to such\n                                    payment by the number of years remaining in\n                                    the designated installment period. The\n                                    installment period may be shortened, in the\n                                    sole discretion of the Committee, if the\n                                    Committee at any time determines that the\n                                    amount of the annual payments that would be\n                                    made to the Participant during the\n                                    designated installment period would be too\n                                    small to justify the maintenance of the\n                                    Participant's Account and the processing of\n                                    payments.\n\n                  4. Prospective Change of Payment Elections. At the time of\n                     ---------------------------------------\nentering into a Deferral Agreement for an Award Year, a Participant may modify\nhis payment elections under Sections 2 and 3 with respect to the portion of his\nor her Account allocable to the amounts to be deferred for that Award Year and\nsubsequent Award Years. If a Participant has different payment elections in\neffect, the Company shall maintain sub-accounts for the Participant to determine\nthe amounts subject to each payment election; no modification of payment\nelections will be accepted if it would require the Company to maintain more than\nfive (5) sub-accounts within the Participant's Account in order to make payments\nin accordance with the Participant's elections.\n\n                  5. Acceleration upon Early Termination. Notwithstanding a\n                     ------------------------------------\nParticipant's payment elections under Sections 2 and 3, if the Participant\nterminates employment with the Company other than by reason of layoff, death or\ndisability and before the Participant is eligible to commence receiving\nretirement benefits under a pension plan maintained by the Company (or before\nthe Participant has attained age 55 if the Participant does not participate in\nsuch a pension plan), the Participant's Account Balance shall be distributed to\nhim or her in a lump sum on or about the January 15th or July 15th next\nfollowing the date of the Participant's termination of employment with the\nCompany.\n\n                  6. Acceleration Upon Conflict of Interest. Notwithstanding a\n                     ---------------------------------------\nParticipant's payment elections under Sections 2 and 3, if following a\nParticipant's termination of employment with the Company, the Participant takes\na position (or accepts a position) with a governmental entity, agency,\n\n\n                                       - 8 -\n\n\n\n\nor instrumentality and that employer has determined or indicated that the\nParticipant's continued participation in the Plan may constitute a conflict of\ninterest precluding the Participant from continuing in his position (or from\naccepting an offered position) with that employer or subjecting the Participant\nto penalty, sanction, or otherwise limiting the Participant's responsibilities\nfor that employer, then the Participant's Account Balance shall be distributed\nto him or her in a lump sum as soon as practical following the later of (i) the\ndate on which the Participant commences employment with the government employer;\nor (ii) the date on which it is determined that the conflict of interest may\nexist.\n\n                  7. Death Benefits. Upon the death of a Participant before a\n                     --------------\ncomplete distribution of his or her Account Balance, the Account Balance will be\npaid to the Participant's Beneficiary in accordance with the payment elections\napplicable to the Participant. If a Participant dies while actively employed or\notherwise before the payment of benefits has commenced, payments to the\nBeneficiary shall commence on the date payments to the Participant would have\ncommenced, taking account of the Participant's termination of employment (by\ndeath or before) and, if applicable, by postponing commencement until after the\ndate the Participant would have attained the commencement age specified by the\nParticipant. Whether the Participant dies before or after the commencement of\ndistributions, payments to the Beneficiary shall be made for the period or\nremaining period elected by the Participant.\n\n                  8. Early Distributions in Special Circumstances.\n                     --------------------------------------------\nNotwithstanding a Participant's payment elections under Sections 2 and 3 of this\nArticle V, a Participant or Beneficiary may request an earlier distribution in\nthe following limited circumstances:\n\n                     (a) Hardship Distributions. Subject to the last sentence\n                         ----------------------\n                  of this Section 8(a) with respect to Section 16 Persons, the\n                  Committee shall have the power and discretion at any time to\n                  approve a payment to a Participant if the Committee determines\n                  that the Participant is suffering from a serious financial\n                  emergency caused by circumstances beyond the Participant's\n                  control which would cause a hardship to the Participant unless\n                  such payment were made. Any such hardship payment will be in a\n                  lump sum and will not exceed the lesser of (i) the amount\n                  necessary to satisfy the financial emergency (taking account\n                  of the income tax liability associated with the distribution),\n                  or (ii) the Participant's Account Balance. In the event that a\n                  Section 16 Person seeks a hardship withdrawal under this\n                  Section 8(a), the distribution will be made first out of the\n                  portion of the Participant's Account, if any, allocated to the\n                  Interest Option; if the hardship distribution cannot be\n                  satisfied in full out of amounts allocated to the Interest\n                  Option, no distribution will be made from the portion of the\n                  Participant's Account allocated to the Company Stock\n                  Investment Option until the seventh month following the month\n                  in which the Participant's application under\n\n\n                                       - 9 -\n\n\n\n                  this Section 8(a) was made, which application shall be\n                  irrevocable when made.\n\n                           (b) Withdrawal with Forfeiture. A Participant may\n                               --------------------------\n                  elect at any time to withdraw ninety percent (90%) of the\n                  amount credited to the Participant's Account. If such a\n                  withdrawal is made, the remaining ten percent (10%) of the\n                  Participant's Account shall be permanently forfeited, and the\n                  Participant will be prohibited from deferring any amount under\n                  the Deferral Plan for the Award Year in which the withdrawal\n                  is received (or the first Award Year in which any portion of\n                  the withdrawal is received). In the event that a Section 16\n                  Person seeks a withdrawal under this Section 8(b), any portion\n                  of the Section 16 Person's Account allocated to the Company\n                  Stock Investment Option will not be subject to distribution or\n                  forfeiture until the seventh month following the month in\n                  which the Participant's election under this Section 8(b) was\n                  made, which election shall be irrevocable when made; any\n                  portion of the Section 16 Person's Account allocated to the\n                  Interest Option will be subject to immediate distribution and\n                  forfeiture; the ten percent forfeiture shall be separately\n                  applied to each such portion of the Section 16 Person's\n                  Account at the time of distribution.\n\n                           (c) Death or Disability. In the event that a\n                               -------------------\n                  Participant dies or becomes permanently disabled before the\n                  Participant's entire Account Balance has been distributed, the\n                  Committee, in its sole discretion, may modify the timing of\n                  distributions from the Participant's Account, including the\n                  commencement date and number of distributions, if it concludes\n                  that such modification is necessary to relieve the financial\n                  burdens of the Participant or Beneficiary.\n\n                  9.       Acceleration upon Change in Control.\n                           -----------------------------------\n\n                           (a) Notwithstanding any other provision of the\n                  Deferral Plan, the Account Balance of each Participant shall\n                  be distributed in a single lump sum within fifteen (15)\n                  calendar days following a \"Change in Control.\"\n\n                           (b) For purposes of this Deferral Plan, a Change in\n                  Control shall include and be deemed to occur upon the\n                  following events:\n\n                                    (1) A tender offer or exchange offer is\n                           consummated for the ownership of securities of the\n                           Company representing 25% or more of the combined\n                           voting power of the Company's then outstanding voting\n                           securities entitled to vote in the election of\n                           directors of the Company.\n\n\n\n                                       - 10 -\n\n\n\n                                    (2) The Company is merged, combined,\n                           consolidated, recapitalized or otherwise reorganized\n                           with one or more other entities that are not\n                           Subsidiaries and, as a result of the merger,\n                           combination, consolidation, recapitalization or other\n                           reorganization, less than 75% of the outstanding\n                           voting securities of the surviving or resulting\n                           corporation shall immediately after the event be\n                           owned in the aggregate by the stockholders of the\n                           Company (directly or indirectly), determined on the\n                           basis of record ownership as of the date of\n                           determination of holders entitled to vote on the\n                           action (or in the absence of a vote, the day\n                           immediately prior to the event).\n\n                                    (3) Any person (as this term is used in\n                           Sections 3(a)(9) and 13(d)(3) of the Exchange Act,\n                           but excluding any person described in and satisfying\n                           the conditions of Rule 13d-1(b)(1) thereunder),\n                           becomes the beneficial owner (as defined in Rule\n                           13d-3 under the Exchange Act), directly or\n                           indirectly, of securities of the Company representing\n                           25% or more of the combined voting power of the\n                           Company's then outstanding securities entitled to\n                           vote in the election of directors of the Company.\n\n                                    (4) At any time within any period of two\n                           years after a tender offer, merger, combination,\n                           consolidation, recapitalization, or other\n                           reorganization or a contested election, or any\n                           combination of these events, the \"Incumbent\n                           Directors\" shall cease to constitute at least a\n                           majority of the authorized number of members of the\n                           Board. For purposes hereof, \"Incumbent Directors\"\n                           shall mean the persons who were members of the Board\n                           immediately before the first of these events and the\n                           persons who were elected or nominated as their\n                           successors or pursuant to increases in the size of\n                           the Board by a vote of at least three-fourths of the\n                           Board members who were then Board members (or\n                           successors or additional members so elected or\n                           nominated).\n\n                                    (5) The stockholders of the Company approve\n                           a plan of liquidation and dissolution or the sale or\n                           transfer of substantially all of the Company's\n                           business and\/or assets as an entirety to an entity\n                           that is not a Subsidiary.\n\n                           (c) Notwithstanding the provisions of Section 9(a),\n                  if a distribution in accordance with the provisions of Section\n                  9(a) would result in a nonexempt short-swing transaction under\n                  Section 16(b) of the Exchange Act with respect to any Section\n                  16 Person, then the date of distribution to such Section 16\n                  Person shall be delayed until the earliest date upon which the\n                  distribution either would not result in a nonexempt\n                  short-swing transaction or would\n\n\n                                       - 11 -\n\n\n\n                  otherwise not result in liability under Section 16(b) of the\n                  Exchange Act.\n\n                           (d) This Section 9 shall apply only to a Change in\n                  Control of Lockheed Martin Corporation and shall not cause\n                  immediate payout of Deferred Compensation in any transaction\n                  involving the Company's sale, liquidation, merger, or other\n                  disposition of any subsidiary.\n\n                           (e) The Committee may cancel or modify this Section 9\n                  at any time prior to a Change in Control. In the event of a\n                  Change in Control, this Section 9 shall remain in force and\n                  effect, and shall not be subject to cancellation or\n                  modification for a period of five years, and any defined term\n                  used in Section 9 shall not, for purposes of Section 9, be\n                  subject to cancellation or modification during the five year\n                  period.\n\n                  10. Deductibility of Payments. In the event that the payment\n                      -------------------------\nof benefits in accordance with the Participant's elections under Sections 2 and\n3 would prevent the Company from claiming an income tax deduction with respect\nto any portion of the benefits paid, the Committee shall have the right to\nmodify the timing of distributions from the Participant's Account as necessary\nto maximize the Company's tax deductions. In the exercise of its discretion to\nadopt a modified distribution schedule, the Committee shall undertake to have\ndistributions made at such times and in such amounts as most closely approximate\nthe Participant's elections, consistent with the objective of maximum\ndeductibility for the Company. The Committee shall have no authority to reduce a\nParticipant's Account Balance or to pay aggregate benefits less than the\nParticipant's Account Balance in the event that all or a portion thereof would\nnot be deductible by the Company.\n\n                  11. Change of Law. Notwithstanding anything to the contrary\n                      -------------\nherein, if the Committee determines in good faith, based on consultation with\ncounsel, that the federal income tax treatment or legal status of the Plan has\nor may be adversely affected by a change in the Internal Revenue Code, Title I\nof the Employee Retirement Income Security Act of 1974, or other applicable law\nor by an administrative or judicial construction thereof, the Committee may\ndirect that the Accounts of affected Participants or of all Participants be\ndistributed as soon as practicable after such determination is made, to the\nextent deemed necessary or advisable by the Committee to cure or mitigate the\nconsequences, or possible consequences of, such change in law or interpretation\nthereof.\n\n                  12. Tax Withholding. To the extent required by law, the\n                      ---------------\nCompany shall withhold from benefit payments hereunder, or with respect to any\nIncentive Compensation deferred hereunder, any Federal, state, or local income\nor payroll taxes required to be withheld and shall furnish the recipient and the\napplicable government agency or agencies with such reports, statements, or\ninformation as may be legally required.\n\n\n                                       - 12 -\n\n\n\n                                   ARTICLE VI\n                                   ----------\n\n                         EXTENT OF PARTICIPANTS' RIGHTS\n                         ------------------------------\n\n\n                  1. Unfunded Status of Plan. This Deferral Plan constitutes a\n                     -----------------------\nmere contractual promise by the Company to make payments in the future, and each\nParticipant's rights shall be those of a general, unsecured creditor of the\nCompany. No Participant shall have any beneficial interest in any specific\nassets that the Company may hold or set aside in connection with this Deferral\nPlan. Notwithstanding the foregoing, to assist the Company in meeting its\nobligations under this Deferral Plan, the Company may set aside assets in a\ntrust described in Revenue Procedure 92-64, 1964-2 C.B. 44, and the Company may\ndirect that its obligations under this Deferral Plan be satisfied by payments\nout of such trust. The assets of any such trust will remain subject to the\nclaims of the general creditors of the Company. It is the Company's intention\nthat the Plan be unfunded for Federal income tax purposes and for purposes of\nTitle I of the Employee Retirement Income Security Act of 1974.\n\n                  2. Nonalienability of Benefits. A Participant's rights under\n                     ---------------------------\nthis Deferral Plan shall not be assignable or transferable and any purported\ntransfer, assignment, pledge or other encumbrance or attachment of any payments\nor benefits under this Deferral Plan, or any interest therein shall not be\npermitted or recognized, other than the designation of, or passage of payment\nrights to, a Beneficiary.\n\n\n                                   ARTICLE VII\n                                   -----------\n\n                            AMENDMENT OR TERMINATION\n                            ------------------------\n\n                  1. Amendment. The Board may amend, modify, suspend or\n                     ---------\ndiscontinue this Deferral Plan at any time subject to any shareholder approval\nthat may be required under applicable law, provided, however, that no such\namendment shall have the effect of reducing a Participant's Account Balance or\npostponing the time when a Participant is entitled to receive a distribution of\nhis Account Balance. Further, no amendment may alter the formula for crediting\ninterest to Participants' Accounts with respect to amounts for which deferral\nelections have previously been made, unless the amended formula is not less\nfavorable to Participants than that previously in effect, or unless each\naffected Participant consents to such change.\n\n                  2. Termination. The Board reserves the right to terminate this\n                     -----------\nPlan at any time and to pay all Participants their Account Balances in a lump\nsum immediately following such termination or at such time thereafter as the\nBoard may determine; provided, however, that if a distribution in accordance\nwith the provisions of this Section 2 would otherwise result in a nonexempt\n\n\n                                       - 13 -\n\n\n\nshort-swing transaction under Section 16(b) of the Exchange Act, the date of\ndistribution with respect to any Section 16 Person shall be delayed until the\nearliest date upon which the distribution either would not result in a nonexempt\nshort-swing transaction or would otherwise not result in liability under Section\n16(b) of the Exchange Act.\n\n                  3. Transfer of Liability. The Board reserves the right to\n                     ---------------------\ntransfer to another entity all of the obligations of Company with respect to a\nParticipant under this Plan if such entity agrees pursuant to a binding written\nagreement to assume all of the obligations of the Company under this Plan with\nrespect to such Participant.\n\n                                  ARTICLE VIII\n                                  ------------\n\n                                 ADMINISTRATION\n                                 --------------\n\n                  1. The Committee. This Deferral Plan shall be administered by\n                     -------------\nthe Compensation Committee of the Board or such other committee of the Board as\nmay be designated by the Board and constituted so as to permit this Deferral\nPlan to comply with the disinterested administration requirements of Rule 16b-3\nof the Exchange Act. The members of the Committee shall be designated by the\nBoard. A majority of the members of the Committee (but not fewer than two) shall\nconstitute a quorum. The vote of a majority of a quorum or the unanimous written\nconsent of the Committee shall constitute action by the Committee. The Committee\nshall have full authority to interpret the Plan, and interpretations of the Plan\nby the Committee shall be final and binding on all parties.\n\n                  2. Delegation and Reliance. The Committee may delegate\n                     -----------------------\nto the officers or employees of the Company the authority to execute and deliver\nthose instruments and documents, to do all acts and things, and to take all\nother steps deemed necessary, advisable or convenient for the effective\nadministration of this Deferral Plan in accordance with its terms and purpose,\nexcept that the Committee may not delegate any authority the delegation of which\nwould cause this Deferral Plan to fail to satisfy the applicable requirements of\nRule 16b-3. In making any determination or in taking or not taking any action\nunder this Deferral Plan, the Committee may obtain and rely upon the advice of\nexperts, including professional advisors to the Company. No member of the\nCommittee or officer of the Company who is a Participant hereunder may\nparticipate in any decision specifically relating to his or her individual\nrights or benefits under the Deferral Plan.\n\n                  3. Exculpation and Indemnity. Neither the Company nor any\n                     -------------------------\nmember of the Board or of the Committee, nor any other person participating in\nany determination of any question under this Deferral Plan, or in the\ninterpretation, administration or application thereof, shall have any liability\nto any party for any action taken or not taken in good faith under this Deferral\nPlan or for the failure of the Deferral Plan or any\n\n\n                                       - 14 -\n\n\n\nParticipant's rights under the Deferral Plan to achieve intended tax\nconsequences, to qualify for exemption or relief under Section 16 of the\nExchange Act and the rules thereunder, or to comply with any other law,\ncompliance with which is not required on the part of the Company.\n\n                  4. Facility of Payment. If a minor, person declared\n                     -------------------\nincompetent, or person incapable of handling the disposition of his or her\nproperty is entitled to receive a benefit, make an application, or make an\nelection hereunder, the Committee may direct that such benefits be paid to, or\nsuch application or election be made by, the guardian, legal representative, or\nperson having the care and custody of such minor, incompetent, or incapable\nperson. Any payment made, application allowed, or election implemented in\naccordance with this Section shall completely discharge the Company and the\nCommittee from all liability with respect thereto.\n\n                  5. Proof of Claims. The Committee may require proof of the\n                     ---------------\n\ndeath, disability, incompetency, minority, or incapacity of any Participant or\nBeneficiary and of the right of a person to receive any benefit or make any\napplication or election.\n\n                  6. Claim Procedures. The procedures when a claim under this\n                     ----------------\nPlan is denied by the Committee are as follows:\n\n                           (A)      The Committee shall:\n\n                                    (i)       notify the claimant within a\n                                              reasonable time of such denial,\n                                              setting forth the specific\n                                              reasons therefor; and\n\n                                    (ii)      afford the claimant a reasonable\n                                              opportunity for a review of the\n                                              decision.\n\n                           (B)      The notice of such denial shall set forth,\n                                    in addition to the specific reasons for the\n                                    denial, the following:\n\n                                    (i)       identification of pertinent\n                                              provisions of this Plan;\n\n                                    (ii)      such additional information as\n                                              may be relevant to the denial\n                                              of the claim; and\n\n                                    (iii)     an explanation of the claims\n                                              review procedure and advice that\n                                              the claimant may request an\n                                              opportunity to submit a statement\n                                              of issues and comments.\n\n                           (C)      Within sixty days following advice of denial\n                                    of a claim, upon request made by the\n                                    claimant, the Committee shall take\n                                    appropriate steps to review its\n\n\n\n                                       - 15 -\n\n\n\n                                    decision in light of any further\n                                    information or comments submitted by the\n                                    claimant. The Committee may hold a\n                                    hearing at which the claimant may\n                                    present the basis of any claim for review.\n\n                           (D)      The Committee shall render a decision within\n                                    a reasonable time (not to exceed 120 days)\n                                    after the claimant's request for review and\n                                    shall advise the claimant in writing of its\n                                    decision, specifying the reasons and\n                                    identifying the appropriate provisions of\n                                    the Plan.\n\n\n                                   ARTICLE IX\n                                   ----------\n\n                      GENERAL AND MISCELLANEOUS PROVISIONS\n                      ------------------------------------\n\n                  1. Neither this Deferral Plan nor a Participant's Deferral\nAgreement, either singly or collectively, shall in any way obligate the Company\nto continue the employment of a Participant with the Company, nor does either\nthis Deferral Plan or a Deferral Agreement limit the right of the Company at any\ntime and for any reason to terminate the Participant's employment. In no event\nshall this Plan or a Deferral Agreement, either singly or collectively, by their\nterms or implications constitute an employment contract of any nature whatsoever\nbetween the Company and a Participant. In no event shall this Plan or a Plan\nAgreement, either singly or collectively, by their terms or implications in any\nway obligate the Company to award Incentive Compensation to any Eligible\nEmployee for any Award Year, whether or not the Eligible Employee is a\nParticipant in the Deferral Plan for that Award Year, nor in any other way limit\nthe right of the Company to change an Eligible Employee's compensation or other\nbenefits.\n\n                  2. Incentive Compensation deferred under this Deferral Plan\nshall not be treated as compensation for purposes of calculating the amount of a\nParticipant's benefits or contributions under any pension, retirement, or other\nplan maintained by the Company, except as provided in such other plan.\n\n                  3. Any written notice to the Company referred to herein shall\nbe made by mailing or delivering such notice to the Company at 6801 Rockledge\nDrive, Bethesda, Maryland 20817, to the attention of the Vice President, Human\nResources. Any written notice to a Participant shall be made by delivery to the\nParticipant in person, through electronic transmission, or by mailing such\nnotice to the Participant at his or her place of residence or business address.\n\n                  4. In the event it should become impossible for the Company or\nthe Committee to perform any act required by this Plan, the Company or the\nCommittee may perform such other act as it in good faith determines will most\nnearly carry out the intent and the purpose of this Deferral Plan.\n\n\n                                       - 16 -\n\n\n\n                  5. By electing to become a Participant hereunder, each\nEligible Employee shall be deemed conclusively to have accepted and consented to\nall of the terms of this Deferral Plan and all actions or decisions made by the\nCompany, the Board, or Committee with regard to the Deferral Plan.\n\n                  6. The provisions of this Deferral Plan and the Deferral\nAgreements hereunder shall be binding upon and inure to the benefit of the\nCompany, its successors, and its assigns, and to the Participants and their\nheirs, executors, administrators, and legal representatives.\n\n                  7. A copy of this Deferral Plan shall be available for\ninspection by Participants or other persons entitled to benefits under the Plan\nat reasonable times at the offices of the Company.\n\n                  8. The validity of this Deferral Plan or any of its provisions\nshall be construed, administered, and governed in all respects under and by the\nlaws of the State of Maryland, except as to matters of Federal law. If any\nprovisions of this instrument shall be held by a court of competent jurisdiction\nto be invalid or unenforceable, the remaining provisions hereof shall continue\nto be fully effective.\n\n                  9. This Deferral Plan and its operation, including but not\nlimited to, the mechanics of deferral elections, the issuance of securities, if\nany, or the payment of cash hereunder is subject to compliance with all\napplicable federal and state laws, rules and regulations (including but not\nlimited to state and federal insider trading, registration, reporting and other\nsecurities laws) and such other approvals by any listing, regulatory or\ngovernmental authority as may, in the opinion of counsel for the Company, be\nnecessary or advisable in connection therewith.\n\n                  10. It is the intent of the Company that this Deferral Plan\nsatisfy and be interpreted in a manner, that, in the case of Participants who\nare or may be Section 16 Persons, satisfies any applicable requirements of Rule\n16b-3 of the Exchange Act or other exemptive rules under Section 16 of the\nExchange Act and will not subject Section 16 Persons to short-swing profit\nliability thereunder. If any provision of this Deferral Plan would otherwise\nfrustrate or conflict with the intent expressed in this Section 10, that\nprovision to the extent possible shall be interpreted and deemed amended so as\nto avoid such conflict. To the extent of any remaining irreconcilable conflict\nwith this intent, the provision shall be deemed disregarded. Similarly, any\naction or election by a Section 16 Person with respect to the Deferral Plan to\nthe extent possible shall be interpreted and deemed amended so as to avoid\nliability under Section 16 or, if this is not possible, to the extent necessary\nto avoid liability under Section 16, shall be deemed ineffective.\nNotwithstanding anything to the contrary in this Deferral Plan, the provisions\nof this Deferral Plan may at any time be bifurcated by the Board or the\nCommittee in any manner so that certain provisions of this Deferral Plan are\napplicable solely to Section 16 Persons. Notwithstanding\n\n\n                                       - 17 -\n\n\n\n\nany other provision of this Deferral Plan to the contrary, if a distribution\nwhich would otherwise occur is prohibited or proposed to be delayed because of\nthe provisions of Section 16 of the Exchange Act or the provisions of the\nDeferral Plan designed to ensure compliance with Section 16, the Section 16\nPerson involved may affirmatively elect in writing to have the distribution\noccur in any event; provided that the Section 16 Person shall concurrently enter\ninto arrangements satisfactory to the Committee in its sole discretion for the\nsatisfaction of any and all liabilities, costs and expenses arising from this\nelection.\n\n                  11. Notwithstanding any other provision of this Deferral Plan,\neach Eligible Employee who is a Section 16 Person and has entered into a\nDeferral Agreement prior to the initial distribution of a prospectus relating to\nthis Deferral Plan shall be entitled, during a ten-business-day period following\nthe initial distribution of that prospectus, to make an irrevocable election to\n(i) receive a distribution of all or any portion of his or her Account Balance\nattributable to Deferred Compensation for the 1995 Award Year during the seventh\nmonth following the month of the election, or (ii) reallocate all or any part of\nhis or her Account Balance attributable to Deferred Compensation for the 1995\nAward Year to a different investment option as of the end of the sixth month\nfollowing the month of the election.\n\n                  12. At no time shall the aggregate Account Balances of all\nParticipants to the extent allocated to the Company Stock Investment Option\nexceed an amount equal to the then fair market value of 5,000,000 shares of the\nCompany's Common Stock, nor shall the cumulative amount of Incentive\nCompensation deferred under this Deferral Plan by all Eligible Employees for all\nAward Years exceed $250,000,000.\n\n\n                                    ARTICLE X\n                                    ----------\n\n                     EFFECTIVE DATE AND SHAREHOLDER APPROVAL\n                     ---------------------------------------\n\n         This Deferral Plan was adopted by the Board on July 27, 1995 and became\neffective upon adoption to awards of Incentive Compensation for the Company's\nfiscal year ending December 31, 1995 and subsequent fiscal years; provided,\nhowever, that with respect to Section 16 Persons, the availability of the\nCompany Stock Investment Option is conditioned upon the approval of this\nDeferral Plan by the stockholders of Lockheed Martin Corporation. In the event\nthat this Deferral Plan is not approved by the stockholders, then Section 16\nPersons shall not be entitled to have Deferred Compensation allocated to the\nCompany Stock Investment Option; any prior elections by Section 16 Persons to\nhave allocations made to the Company Stock Investment Option shall retroactively\nbe deemed ineffective, and the Account Balances of those Section 16 Persons\nshall be restated as if all of their Deferred Compensation had been allocated to\nthe Interest Option at all times. Subsequent amendments to the Deferral Plan are\neffective as of the date stated in the amendment or the adopting resolution.\n\n\n                                       - 18 -\n\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8070],"corporate_contracts_industries":[9476],"corporate_contracts_types":[9539,9542],"class_list":["post-38770","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-lockheed-martin-corp","corporate_contracts_industries-aerospace__space","corporate_contracts_types-compensation","corporate_contracts_types-compensation__deferred"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38770","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38770"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38770"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38770"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38770"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}