Executive Retention Agreement
Exhibit 99
Lockheed Xxxxxx Corporation
0000 Xxxxxxxxx Xxxxx Xxxxxxxx, XX 00000
Telephone 0000000000
LOCKHEED XXXXXX
The purpose of this agreement between Lockheed Xxxxxx Corporation Aeronautics Company (the “Business Unit”) and Xxxxx X. Xxxxx (the “Executive”) is to provide for continuity of management and the success of business operations for a major program by ensuring the commitment of the Executive to continue to serve the Business Unit diligently for a three-year period. The retention payment herein provided is intended to be consideration for the successful performance and satisfaction of the criteria set forth in Paragraph 2 by the personal services of the Executive.
1. Term of Agreement
This agreement will be in effect from the date of execution through July 1, 2006, unless terminated earlier in accordance with Paragraph 5 or 6.
2. Criteria for Retention Payment
The executive will be eligible for payments under this agreement if:
| • | The Executive remains employed at the Business Unit (or at the discretion of the Corporation, at another Lockheed Xxxxxx Business Area/Unit) through July 1, 2005, for the first payment, and through July 1, 2006, for the second payment. |
| • | The Executive devotes full effort and diligence to the operation and successful performance of the FA-22 Program, and to the execution of other Business Unit objectives as may be assigned by the Lockheed Xxxxxx Executive Vice President - Aeronautics Company. |
3. Amount of Retention Payment
The retention payment under this agreement will be $400,000. This payment is in addition to the Executive’s continued participation in the Corporation’s annual bonus and long-term incentive programs.
Key Executive Retention Agreement
Page 2
4. Payment of Retention Amount
The retention payment under this agreement shall be paid in two installments. The first installment will be $150,000 and will be payable within 30 days after July 1, 2005, or within 60 days of notice of termination if the executive becomes eligible for a payment under Paragraph 5. The second installment will be $250,000 and will be payable within 30 days after July 1, 2006, or within 60 days of notice of termination if the Executive becomes eligible for a payment under Paragraph 5.
5. Layoff, Disability or Death
If during the term of this agreement, the Executive (i) becomes disabled, or (ii) dies, the Executive will be eligible for a pro rata retention payment under this agreement. The pro rata payment shall be calculated by multiplying the total potential payment ($400,000) by a fraction, the numerator being the number of months prior to disability or death, and the denominator being the total number of months of the term of agreement. The amount so calculated shall be reduced by any installment payment already made. For a layoff, payment will be made in full in addition to any severance payments otherwise due the Executive.
6. Retirement, Resignation or Termination for Cause
If the Executive retires, resigns or is discharged for cause during the term of this agreement, the Executive will not be eligible for any remaining payment under this agreement, and the agreement will be terminated immediately.
7. Termination of Agreement
This retention agreement will terminate on July 1, 2006.
8. No Contract of Employment
This agreement does not limit the ability of either the Executive or Lockheed Xxxxxx to terminate the employment relationship at will.
9. No Assignment
No benefit payable under this agreement may be assigned, transferred, pledged or otherwise encumbered or subjected to any legal process for the payment of any claim against the Executive.
Key Executive Retention Agreement
Page 3
10. Governing Law
This agreement shall be governed in all respects by and in accordance with the laws of the State of Maryland without regard to its conflict of law provisions.
If you agree to all terms and provisions of this agreement, please indicate your acceptance by signing below.
| Agreed to and accepted: |
For Lockheed Xxxxxx: | |
| /s/ Xxxxx X. Xxxxx |
/s/ Xxxx X. Xxxxxxx | |
| Xxxxx X. Xxxxx |
Xxxx X. Xxxxxxx | |
| Dated: 28 June 2003 |
Executive Vice President | |
| Lockheed Xxxxxx Aeronautics Company | ||
| /s/ Xxxxx X. Xxxxxx | ||
| Xxxxx X. Xxxxxx | ||
| Xx. Vice President, Human Resources | ||
| Lockheed Xxxxxx Corporation | ||
