{"id":39811,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/executive-deferred-compensation-plan-northrop-grumman-corp.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"executive-deferred-compensation-plan-northrop-grumman-corp","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/executive-deferred-compensation-plan-northrop-grumman-corp.html","title":{"rendered":"Executive Deferred Compensation Plan &#8211; Northrop Grumman Corp."},"content":{"rendered":"<pre>                                NORTHROP GRUMMAN\n                      EXECUTIVE DEFERRED COMPENSATION PLAN\n\n1.  Purpose.\n    --------\n\nThe purpose of the Plan is to provide an arrangement whereby executives can\nelect to defer receipt of compensation for which a deduction to the Corporation\nwould otherwise be disallowed for federal income tax purposes under Section\n162(m) of the Internal Revenue Code of 1986, as amended (\"Code\"). The Plan as\namended and restated herein is effective November 2, 2000.\n\n2.  Definitions.\n    ------------\n\n    (a) \"Committee\" is the Compensation and Management Development Committee (or\nits successor) of the Board of Directors of Northrop Grumman Corporation.\n\n    (b)  \"Company\" means Northrop Grumman Corporation and any of its\nsubsidiaries or affiliates.\n\n    (c)  \"Compensation\" means salary and other items of includible compensation\npaid to a Participant from the Company or a calendar year.\n\n    (d)  \"Corporation\" means Northrop Grumman Corporation.\n\n    (e)  \"Disability\" means a permanent and total disability for which a\nParticipant is currently receiving benefits from a long-term disability plan\nsponsored by the Company.\n\n    (f)  \"Effective Date\" means December 30, 1994, or such other date as\nspecified by the Board of Directors.\n\n    (g)  \"Eligible Employee\" means an employee who meets the conditions for\neligibility under Section 3 of this Plan.\n\n    (h)  \"Estate Enhancement Program Election\" means an election made by a\nparticipant to participate in the Northrop Grumman Estate Enhancement Program\nunder which the Participant elects to have all or any portion of his or her\ndeferral account balance converted to an Estate Enhancement Program Account.\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\n    (i)  \"Estate Enhancement Program Account\" means all or any portion of the\nParticipant's Plan account balance with respect to which the Participant has\nmade an Estate Enhancement Program Election.\n\n    (j)  \"Participant\" means an Eligible Employee who makes an election to defer\nCompensation under this Plan.\n\n    (k)  \"Plan\" means the Executive Deferred Compensation Plan of the Northrop\nGrumman Corporation as set forth herein and as from time to time amended.\n\n    (l)  \"Plan Year\" means the calendar year.\n\n    (m)  \"Retirement\" means retirement pursuant to one or more of the qualified\npension or profit-sharing plans maintained by the Company.\n\n    (n)  \"Section 162(m) limit\" means the limit on deductibility of salary and\nother compensation imposed by Section 162(m) of the Code, and any subsequent or\nsuperseding provisions of the Code.\n\n    (o)  \"Termination\" means a complete separation from service by the\nParticipant from the Company.\n\n3.  Eligibility.\n    ------------\n\nAn employee of the Company who is eligible to receive Compensation in excess of\nthe Section 162(m) limit may be eligible to participate in this Plan for that\nyear, upon approval of his eligibility by the Committee.\n\n4.  Participation.\n    --------------\n\n    (a)  An Eligible Employee may become a Participant by electing to defer some\nor all of his Compensation under this Plan, on a form and in the manner\nspecified by the Committee.\n\n    (b)  Eligible Employees must make a separate election to participate with\nrespect to each Plan Year. Any deferral made under this Plan shall only be\neffective with respect to the Plan Year to which it relates.\n\n                                       2\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\n5.   Time of Deferral.\n     -----------------\n\n     (a)  An election to defer Compensation under this Plan shall be made no\nlater than December 31 preceding the calendar year in which the services are\nperformed to which the Compensation relates.\n\n     (b)  Any deferral election under this Plan shall be binding with respect to\nthe period for which it was made and shall be irrevocable with respect to that\nperiod.\n\n6.   Deferral Account.\n     -----------------\n\nThere shall be established on the books of the Corporation a deferral account\nfor each Participant, and all amounts deferred by the Participant under this\nPlan for all years of participation shall be credited to that account, together\nwith any interest or earnings on such amounts.\n\n7.   Investment options.\n     -------------------\n\n     (a)  During the first full Plan Year, interest will be credited to deferral\naccounts at a rate equal to 115-percent of the fourth quarter monthly rate of\nMoody's Average Corporate Bond rate.\n\n     (b)  With respect to subsequent Plan Years, the Committee, in its sole\ndiscretion, may make available one or more investment options under this Plan in\nwhich Participants may elect to direct investment of their deferral accounts. In\naddition, the Committee may determine that one or more of the accounts shall\nearn interest at a stated rate over a specified term.\n\n     (c)  Notwithstanding the other provisions of this Section 7, amounts in an\nEstate Enhancement Program Account shall not be credited with any interest or\nother investment earnings or losses.\n\n8.   No Guarantee of Payment; No Funding.\n     ------------------------------------\n\n     (a)  Participants in this Plan shall have no rights on account of this Plan\nin or to any specific assets of the Company, and any rights that a Participant\nshall\n\n                                       3\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\nhave on account of this Plan shall be no greater than those of a general,\nunsecured creditor of the Corporation.\n\n     (b)  The Corporation in no way guarantees the principal, or any other\nportion of a Participant deferral account and any earnings thereon. Any and all\ninvestments remain the property of the Corporation.\n\n     (c)  The Corporation, in its sole discretion, may establish a separate\nrabbi trust for the purpose of funding its obligations under this Plan, and may\nalso fund its obligations under a rabbi trust which funds other nonqualified\nbenefit obligations of the Corporation. However, nothing contained herein shall\nrequire the establishment or funding of any such trust with respect to benefit\nobligations or liabilities under this Plan.\n\n     (d)  This Plan is intended to qualify as an unfunded plan maintained\nprimarily for the purpose of providing deferred compensation for a select group\nof management and highly compensated employees (\"a Top-Hat Plan\"), for purposes\nof Title I of the Employee Retirement Income Security Act of 1974, as amended\n(\"ERISA\"). In the event of any change in law which the Committee determines, in\nits discretion, will cause the Plan to fail to qualify as a Top-Hat Plan, the\nCommittee may terminate the participation of such Participants as it deems\nnecessary to preserve or restore the Plan's status, and may take such other\naction, including the acceleration of payment of Participant deferral accounts,\nif necessary to preserve or restore the Plan's status as a Top-Hat Plan.\n\n9. Form and Timing of Distributions.\n   ---------------------------------\n\n     (a)  At the time a Participant makes a deferral election under this Plan,\nhe or she shall also make an election with respect to the form of payment of\nthat deferral (a \"Distribution Election\"). Each Distribution Election shall be\neffective only with respect to the deferral elected for that period (and\npro-rata earnings on that deferral, if any), and a separate Distribution\nElection shall be made for any subsequent deferrals.\n\n     (b)  A Distribution Election shall consist of one of the following:\n\n          (1)  A lump sum payment to be made in the year following the earliest\n               to occur of the Participant's Termination, Retirement or\n               Disability; and\n\n                                       4\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\n          (2)  Annual installment payments for a period of five or ten years,\n               beginning in the year following the earliest to occur of the\n               Participant's Termination, Retirement or Disability.\n\n     (c)  Distributions shall be paid in January of each year or as soon\nthereafter as administratively possible.\n\n     (d)  The death of a Participant prior to his Retirement or Disability shall\nbe treated as a Termination of employment for purposes of the distribution of\nbenefits under this Plan. In the event that a Participant receiving installment\ndistributions dies prior to the receipt of all such installments, installment\npayments shall continue to the Participant's beneficiary or beneficiaries, as\ndesignated under this Plan.\n\n     (e)  Notwithstanding the other provisions of this Section 9, any amounts in\na Participant's Estate Enhancement Program Account shall be paid in a single sum\nwithin sixty (60) days after the Participant's death (or the death of the\nsurvivor of the Participant and the Participant's spouse, if the life insurance\npolicy issued pursuant to the Participant's Estate Enhancement Program Election\nis a survivorship policy insuring the Participant and the Participant's spouse).\n\n10.  Beneficiary Designation.\n     ------------------------\n\n     (a)  At the time of deferral election or any time thereafter, a Participant\nmay designate one or more beneficiaries to receive any benefits due upon death.\nIn the absence of any designation under this Plan, the beneficiary of a married\nParticipant shall be the Participant's spouse to whom he was married at the time\nof death, and the beneficiary of an unmarried Participant shall be his estate.\n\n     (b)  The Participant can elect to change his beneficiary at any time up to\nthe date of distribution, and no consent shall be required for a married\nParticipant to designate a non-spouse beneficiary.\n\n     (c)  A Participant who has an Estate Enhancement Program Account shall\ndesignate one or more beneficiaries to receive any benefits payable from such\naccount upon death, and a beneficiary designation made with respect to any such\namounts before such amounts are converted to the Estate Enhancement Program\nAccount shall not be effective with respect to such amounts. In the absence of\nany\n\n                                       5\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\nsuch designation, amounts in the Estate Enhancement Program Account shall be\npaid in a single sum to the estate of the Participant (or, if the insurance\npolicy issued pursuant to the Participant's Estate Enhancement Program Election\nis a survivorship policy insuring the Participant and the Participant's spouse,\nthe estate of the survivor of the Participant and the Participant's spouse).\n\n11.  Emergency Benefit.\n     ------------------\n\nIf a Participant suffers an unforeseeable and immediate financial emergency, the\nCommittee, in its sole discretion and upon the written application of the\nParticipant, may distribute to the Participant at such time as the Committee may\nprescribe that portion of his deferral account, if any, which the Committee\ndetermines is necessary to meet the financial emergency. A financial emergency\nshall include major uninsured medical expenses or such other circumstances as\nthe Committee may, in its discretion, determine, provided that the Participant\ndemonstrates to the Committee's satisfaction that he lacks available resources\nto meet the emergency. Any such distribution shall reduce the balance in the\nParticipants deferral account available for distribution. Notwithstanding the\nforegoing, no portion of a Participant's Estate Enhancement Program Account is\neligible to be distributed to a Participant as an emergency benefit.\n\n12.  Administration of the Plan.\n     ---------------------------\n\n     (a)  The Committee shall be the Administrator of the Plan, and it may\ndelegate responsibilities therefor to the Vice President, Human Resources, or\nhis delegates.\n\n     (b)  The Committee shall have the full and exclusive authority to interpret\nthe Plan, to construe ambiguities and to decide all matters under the Plan in\nits discretion. Such interpretation and decision shall be final, conclusive and\nbinding on all Participants and any person claiming under or through any\nParticipant.\n\n     (c)  The Committee shall have full discretionary authority to interpret and\nadminister the Plan, and to make such rules and regulations as it deems\nnecessary or appropriate to carry out its responsibilities under this Plan as\nwell as the purposes for which it was established, including any rules relating\nto the availability of investment options for deferral accounts.\n\n                                       6\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\n13.  Taxes.\n     ------\n\nThe Corporation may withhold from any distribution under this Plan any and all\namounts necessary for the payment of any taxes, including without limitation,\nincome and employment taxes, and the amounts payable to Participants shall be\nreduced by the tax so withheld.\n\n14.  Amendment and Termination.\n     --------------------------\n\n     (a)  The Committee may at any time amend the Plan in any manner (including\nany method for determining earnings on deferral accounts), provided that no such\namendment shall reduce the amounts previously credited to a deferral account of\nany Participant for periods prior to the amendment.\n\n     (b)  The Plan shall continue in effect until terminated by action of the\nBoard of Directors of the Corporation. Upon termination of the Plan, no further\ndeferrals of Compensation shall be made, and distribution of any amounts\ncredited to deferral accounts shall be made in accordance with rules of the\nCommittee.\n\n15.  No Assignment of Benefits.\n     --------------------------\n\nParticipants rights to benefit payments under the Plan are not subject in any\nmanner to anticipation, alienation, sale, transfer, assignment, pledge,\nencumbrance, attachment, or garnishment by creditors of the Participant or the\nParticipant's beneficiary.\n\n16.  Future Rights.\n     --------------\n\nNo person shall have any claim or right under this Plan to be retained in the\nemploy of the Company, or to remain eligible for any Compensation able to be\ndeferred under this Plan.\n\n17.  Governing Law\n     -------------\n\nThe terms of this Plan shall be construed in accordance with the laws of the\nState of Delaware, to the extent not preempted by federal law.\n\n                                       7\n\n\n\nNorthrop Grumman Executive Deferred Compensation Plan\n\n\n18.  Forfeitures.\n     ------------\n\nNotwithstanding anything in this Plan to the contrary, any benefit payable to a\nParticipant hereunder may be forfeited, discontinued or reduced if the\nParticipant is discharged for gross misconduct of a type which is or was\ndirectly or indirectly harmful to the business or reputation of the Corporation.\n\n                                       8\n\n\n\n                             FIRST AMENDMENT TO THE\n                                NORTHROP GRUMMAN\n                      EXECUTIVE DEFERRED COMPENSATION PLAN\n\n     The following changes to the Northrop Grumman Executive Deferred\nCompensation Plan effective November 2, 2000 (the \"Plan\"), as described below,\nare intended to transfer certain liabilities to the Northrop Grumman Deferred\nCompensation Plan, effective March 1, 2001.\n\n1.   A new Section 19 is added as follows:\n\n     19.  Transfer of Liabilities.\n          -----------------------\n\n     Effective March 1, 2001, all liabilities under this Plan, other than the\n     Estate Enhancement Program Account, are transferred to the Northrop Grumman\n     Deferred Compensation Plan. After the transfer, those liabilities will be\n     governed by the terms of that plan, and the provisions of this Plan will\n     cease to apply. After the transfer, any assets set aside for these\n     liabilities in a rabbi trust will instead be set aside for the liabilities\n     under the Northrop Grumman Deferred Compensation Plan.\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8374],"corporate_contracts_industries":[9473],"corporate_contracts_types":[9539,9542],"class_list":["post-39811","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-northrop-grumman-corp","corporate_contracts_industries-aerospace__aircraft","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\/39811","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=39811"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=39811"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=39811"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=39811"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}