Lockheed Martin Corp. Contracts
Sample Business Contracts
Special Agreement - Lockheed Martin Corp. and Louis R. Hughes
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SPECIAL AGREEMENT
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AGREEMENT entered into as of April 3, 2000 (the "Effective Date") between
Lockheed Martin Corporation (the "Corporation") and Louis R. Hughes (the
"Executive").
1. Employment. The Corporation hereby agrees to employ the Executive and the
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Executive hereby accepts employment upon the terms and conditions set forth
in this Agreement (the "Agreement").
2. Term. The period of employment of the Executive by the Corporation
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hereunder (the "Term") shall commence as of April 27, 2000 (the
"Commencement Date") and shall end on April 26, 2003, provided, however,
that the Term shall automatically renew for two additional one-year periods
unless no later than six months prior to a scheduled expiration of the
Term, the Corporation or the Executive shall have notified the other in
writing that the Term shall not renew. Notwithstanding the foregoing, the
Term may be earlier terminated by either party ("Party") in accordance with
the provisions of Section 5.
3. Nature of Employment.
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(a) During the Term, the Corporation shall employ the Executive as
President and Chief Operating Officer of the Corporation, reporting
directly to the Chief Executive Officer. He shall have such powers
and duties as are assigned to him by the Chief Executive Officer.
(b) The Executive's office will be in the Corporation's Bethesda, Maryland
corporate headquarters.
(c) The Executive promises to perform and discharge faithfully his duties
as the Corporation's President and Chief Operating Officer. The
Executive agrees to serve the Corporation for the Term. The Executive
agrees to devote substantially all of his business time and attention
to the business of the Corporation and shall not during the Term be
engaged in any other business activity whether or not that business
activity is pursued for gain, profit or other pecuniary advantage.
Anything in this Section 3(c) to the contrary notwithstanding, nothing
herein shall preclude the Executive from (i) serving on boards of
directors of the companies listed in Exhibit A and the boards of
directors of a reasonable number of other corporations with the
concurrence of the Chief Executive Officer, (ii) serving on the boards
of a reasonable number of trade associations and/or charitable
organizations, (iii) engaging in charitable activities and community
affairs, and (iv) managing his personal investments and affairs,
provided that such activities set forth in this Section 3(c) do not
conflict or materially interfere with the effective discharge of his
duties and responsibilities under this Section 3(c).
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4. Compensation and Benefits.
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(a) Base Salary. The Executive shall be paid an annualized Base Salary in
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accordance with the letter agreement dated March 31, 2000 between the
Corporation and the Executive (the "Letter Agreement").
(b) Annual Incentive Award. During the Term, commencing in 2000 the
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Executive shall participate in the Corporation's Management Incentive
Compensation Plan ("MICP") or successor plan, in accordance with the
Letter Agreement.
(c) Long-Term Incentive Awards.
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(i) Stock Option Award. As of the Commencement Date, the
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Corporation shall grant the Executive an option to purchase
450,000 shares of Common Stock of the Corporation based on the
terms set forth in Exhibit B attached hereto.
(ii) Restricted Stock Award. As of the Commencement Date, the
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Corporation shall grant the Executive 50,000 shares of
restricted stock based on the terms set forth in Exhibit C
attached hereto.
(iii) Long-Term Incentive Plan ("LTIP") Award. The Executive shall
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participate in the Corporation's 2000-2002 LTIP with a target
award of $2,000,000, based on the terms set forth in Exhibit D
attached hereto.
(iv) On-going Long-Term Incentives. In addition to the foregoing
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awards, the Executive shall be eligible to participate in the
Corporation's on-going long-term incentive programs, including,
without limitation, the stock option and other long-term
incentive programs on the same basis as other senior
executives.
5. Termination of Employment during Term. The Term shall be terminated upon
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the termination of the Executive's employment as provided in this Section
5. In such event the Executive shall have the entitlements as provided
below:
(a) Termination Due to Death. In the event that the Executive's
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employment is terminated due to his death, his estate or his
beneficiaries, as the case may be, shall be entitled to the following:
(i) Base Salary through the end of the month in which death
occurs;
(ii) pro-rata annual incentive award for the year in which the
Executive's death occurs, when bonuses are paid to other
officers; and
(iii) in respect of stock options as provided in Exhibit B,
restricted stock as provided in Exhibit C and LTIP awards as
provided in Exhibit D.
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(b) Termination Due to Disability.
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(i) "Disability" shall be as defined in the Corporation's long-
term disability plan applicable to Corporate Headquarters
employees.
(ii) In the event that the Executive's employment is terminated due
to his Disability, he shall be entitled to the following:
(A) disability benefits in accordance with the long-term
disability program, if purchased by the Executive through
the Corporation's benefit plan;
(B) Base Salary through the end of the month in which
disability benefits commence;
(C) pro-rata annual incentive award for the year in which the
Executive's termination occurs, payable when bonuses are
paid to other officers; and
(D) in respect of stock options as provided in Exhibit B,
restricted stock as provided in Exhibit C and LTIP awards
as provided in Exhibit D.
(c) Termination by the Corporation for Cause.
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(i) "Substantial and Serious Cause" or "Cause" shall mean the
Executive's final conviction of (x) a Federal or state felony
or (y) a Federal or state offense involving fraud, corruption,
or moral turpitude; the Executive's engaging in willful fraud
involving material funds or other assets of the Corporation;
or the debarrment of the Executive from engaging in
contracting or subcontracting activities with the Federal
government if such debarment is the result of a final
determination by a government agency that the Executive
knowingly acted in a manner justifying such debarment.
(ii) In the event the Corporation terminates the Executive's
employment for Cause, he shall be entitled to the following:
(A) Base Salary through the date of the termination; and
(B) in respect of stock options as provided in Exhibit B,
restricted stock as provided in Exhibit C and LTIP awards
as provided in Exhibit D.
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(d) Termination without Cause or Constructive Termination without Cause.
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(i) In the event the Executive's employment is terminated by the
Corporation without Cause, other than due to Disability or
death, or in the event there is a Constructive Termination
without Cause (as defined in Section 5(d)(ii) below), the
Executive shall be entitled to the following:
(A) Base Salary through the date of termination;
(B) a pro-rata annual incentive award for the year in which
termination occurs based on the target MICP for the year
of termination;
(C) a lump sum payment in cash (less applicable withholdings)
equal to the sum of two times the Executive's highest
annual base rate of pay during the Executive's Term,
payable within 15 days of the Executive's termination;
(D) a lump sum payment in cash (less applicable withholdings)
equal to two times the target MICP for the year of
termination (assuming target MICP for President and Chief
Operating Officer), payable within 15 days of the
Executive's termination;
(E) in respect of stock options as provided in Exhibit B,
restricted stock as provided in Exhibit C and LTIP awards
as provided in Exhibit D.
(F) a lump sum payment in cash equal to the COBRA premium for
health insurance for a period of 18 months.
(ii) "Constructive Termination Without Cause" shall mean a
termination of the Executive's employment at his initiative
following the occurrence, without the Executive's written
consent, of one or more of the following events:
(A) a reduction in the Executive's then current Base Salary,
target award opportunity under the Corporation's MICP or
successor plan or long-term opportunities as contemplated
by Section 4(c)(iv) above or the termination or material
reduction of any employee benefit or perquisite enjoyed by
him (other than as part of an across-the-board reduction
applicable to all executive officers of the Corporation);
(B) the failure to elect or reelect the Executive as a
director during the Term;
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(C) failure to appoint or reappoint the Executive to the
positions described in Section 3 above or removal of him
from any such position; or
(D) the occurrence of a Change of Control as defined in
Section 7(c) of the 1995 Omnibus Performance Award Plan
(adopted March 15, 1995 and amended April 23, 1998) and
(X) a material diminution in the Executive's duties
or the assignment to the Executive of duties which
are materially inconsistent with his duties or which
materially impair the Executive's ability to function
as the President and Chief Operating Officer of the
Corporation; or
(Y) the failure of the Corporation to obtain the
assumption in writing of its obligation to perform
this Agreement by any successor to all or
substantially all of the assets of the Corporation
within 15 days after a merger, consolidation, sale or
similar transaction.
(e) Voluntary Termination. A termination of employment by the Executive
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on his own initiative, other than a termination due to death,
Disability or a Constructive Termination without Cause, shall have the
same consequences as provided in Section 5(c)(ii) above for a
Termination for Cause. A voluntary termination under this Section
5(e) shall be effective 30 calendar days after prior written notice is
received by the Corporation, unless the Corporation elects to make it
effective earlier.
(f) Non-renewal by the Corporation. In the event that the Corporation
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notifies the Executive pursuant to Section 2 of this Agreement that
the Term shall not renew, the Executive shall be entitled to the same
benefits as provided in Section 5(d) above provided, however that the
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multiple provided in Sections 5(d)(i)(C) and (D) above shall be one
rather than two.
(g) Consequences of a Change of Control. Should any payments,
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entitlements or benefits hereunder (or under any other agreement
between the Executive and the Corporation) be subject to excise tax
pursuant to Section 4999 of the Internal Revenue Code of 1986, as
amended, or comparable state or local tax laws, the Corporation shall
pay to the Executive such additional compensation as is necessary
(after taking into account all Federal, state and local income, excise
and employment taxes payable by the Executive as a result of the
receipt of such compensation) to place the Executive in the same
after-tax position he would have been in had no excise tax been paid
or incurred.
The determination of whether these covered payments are subject to an
excise tax and the amount of additional compensation to be paid to the
Executive shall be made by an independent auditor jointly selected by
the Corporation and the Executive and paid by the Corporation. If the
Executive and the Corporation cannot agree on the firm to serve as the
auditor, the Executive and the Corporation shall each select an
accounting firm and those two firms shall jointly select a third firm
to act as the auditor.
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(h) No Mitigation; No Offset. In the event of any termination of
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employment under this Section 5, the Executive shall be
under no obligation to seek other employment and there shall
be no offset against amounts due the Executive under this
Agreement on account of any remuneration attributable to any
subsequent employment that he may obtain.
(i) Nature of Payments. Any amounts due under this Section 5 are
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considered to be reasonable by the Corporation and are not in
the nature of a penalty.
6. Disclosure of Information and Intellectual Property.
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While serving as the Corporation's President and Chief Operating Officer,
the Executive will have access to confidential information of the
Corporation. The Executive recognizes and acknowledges that the
Corporation's proprietary developments, trade secrets, confidential,
technical and business data, and sensitive management, financial, business,
planning, marketing information, and the like ("Proprietary Information"),
are valuable, special and unique assets of the Corporation's business,
access to and knowledge of which are essential to the performance of the
Executive's duties under this Agreement. Proprietary Information means any
information of the Corporation or of others which has come into the
Corporation's or the Executive's possession, custody or knowledge in the
course of employment that has independent economic value as a result of its
not being generally known to the public and is the subject of reasonable
means to preserve the confidentiality of the information. Proprietary
Information includes(without limitation) information, whether written or
otherwise, regarding the Corporation's earnings, expenses, marketing
information, cost estimates, forecasts, bid and proposal data, financial
data, trade secrets, products, procedures, inventions, systems or designs,
manufacturing or research processes, material sources, equipment sources,
customers and prospective customers, business plans, strategies, buying
practices and procedures, prospective and executed contracts and other
business arrangements or business prospects, except to the extent such
information becomes readily available to the general public lawfully and
without breach of a confidential, contractual, or fiduciary duty of the
Executive. The Executive shall not, other than in the course of performing
his duties hereunder, during or after the Term, in whole or in part,
disclose such Proprietary Information to any person, firm, corporation,
association or other entity for any reason or purpose whatsoever; nor shall
the Executive make use of any such property for his own purposes or for the
benefit of any person, firm, corporation or other entity except the
Corporation under any circumstance; provided that the restrictions shall
not apply to such Proprietary Information which is in the public domain so
long as the Executive was not responsible, directly or indirectly, for such
Proprietary Information entering the public domain without the
Corporation's consent. Anything herein to the contrary notwithstanding,
the Executive may disclose Confidential Information to the extent
disclosure is or may be required by a statute, by a court of law, by any
governmental agency having supervisory authority over the business of the
Corporation or by any administrative or legislative body (including a
committee thereof) with apparent jurisdiction to order him to divulge,
disclose or make accessible such information; provided, however, upon
learning of any such required disclosure of Confidential Information, the
Executive shall give prompt notice to the Corporation of such required
disclosure in order to give the Corporation the opportunity, if it chooses,
to oppose any such required disclosure and/or to seek a protective order.
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7. Non-competition.
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In consideration for the covenants contained in this Agreement, the
Executive agrees that in the event he terminates employment with the
Corporation during the Term, whether involuntarily, voluntarily and for any
reason, the Executive shall not during the Non-Competition Period (as
defined below) engage in any business (whether as an officer, director,
owner, employee, consultant, partner, or other direct or indirect
participant) competing with that of the Corporation in any area in which
the Corporation is conducting any business on the date of termination. The
Executive also agrees, that during the Non-Competition Period, he will not
interfere with, disrupt, or attempt to disrupt the relationship,
contractual or otherwise, between the Corporation and any customer,
supplier or employee of the Corporation. The Executive acknowledges that
the duration and area for which these restrictions are to be effective are
fair and reasonable and are reasonably required for the protection of the
Corporation's legitimate business interests from unfair competition as a
result of the high level executive and management position he will hold
within the Corporation and the attendant access and extensive knowledge of
the Corporation's confidential and proprietary property and information,
including trade secrets, customer and supplier relationships and good will.
Anything herein to the contrary notwithstanding, the Executive may engage
in activity that otherwise might be deemed to be in competition with the
Corporation if the Chairman approves, in writing, such activity.
The term "Non-Competition Period" shall mean (a) in the case of termination
under Section 5(c) or 5(d) above (whether for Substantial and Serious Cause
or otherwise), two years, or the remaining Term, whichever is longer; and
(b) in the case of voluntary termination by the Executive under Section
5(e) above, the remaining Term.
8. Dispute Resolution.
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(a) Any disputes arising under or in connection with this Agreement shall,
at the election of the Executive or the Corporation, be resolved by
binding arbitration, to be held in Bethesda, Maryland in accordance
with the rules and procedures of the American Arbitration Association.
Judgment upon the award rendered by the arbitrator(s) may be entered
in any court having jurisdiction thereof. Costs of the arbitrator(s)
shall be borne equally by the Parties, and each Party shall otherwise
bear his or its own costs of the arbitration, including, without
limitation, reasonable attorneys' fees.
(b) Injunction. The parties acknowledge that the Executive's obligations
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as set forth in Sections 6 and 7 above are of a special, unique and
extraordinary character; that the Corporation would suffer irreparable
harm as a result of the Executive's breach of
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such covenants; and that the Executive's breach of such covenants
could not reasonably or adequately be compensated in damages in law or
through the offset or withholding of any monies to which he may be
entitled from the Corporation. If there is a breach or threatened
breach of the provisions of Section 6 or 7 above, the Corporation
shall be entitled to seek an injunction restraining the Executive from
such breach. Nothing herein shall be construed as prohibiting the
Corporation from pursuing any other remedies for such breach or
threatened breach.
9. Indemnification.
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(a) The Corporation agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding,
whether civil, criminal, administrative or investigative (a
"Proceeding"), by reason of the fact that he is or was a director,
officer or employee of the Corporation or is or was serving at the
request of the Corporation as a director, officer, member, employee or
agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to employee benefit
plans, whether or not the basis of such Proceeding is the Executive's
alleged action in an official capacity while serving as a director,
officer, member, employee or agent, the Executive shall be indemnified
and held harmless by the Corporation to the fullest extent permitted
or authorized by the Corporation's charter or bylaws or, if greater,
by the laws of the State of Maryland, against all cost, expense,
liability and loss (including, without limitation, attorney's fees,
judgments, fines, ERISA excise taxes or penalties and amounts paid or
to be paid in settlement) reasonably incurred or suffered by the
Executive in connection therewith, and such indemnification shall
continue as to the Executive even if he has ceased to be a director,
member, employee or agent of the Corporation or other entity and shall
inure to the benefit of the Executive's heirs, executors and
administrators.
(b) The Corporation agrees to continue and maintain a directors' and
officers' liability insurance policy covering the Executive. The
amount of coverage shall be reasonable in relation to the Executive's
position and responsibilities during the Term.
10. Effect of Agreement on Compensation and Other Benefits.
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Except as specifically provided in this Agreement, the existence of this
Agreement shall not prohibit or restrict the Executive's entitlement to
full participation in the compensation, employee benefit and other plans or
programs in which senior executives of the Corporation are eligible to
participate.
11. Assumption and Assignability of Agreement.
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This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the
Executive) and assigns. No rights or obligations of the Corporation under
this Agreement may be assigned or transferred by the
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Corporation except that such rights or obligations may be assigned or
transferred pursuant to a merger or consolidation in which the Corporation
is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Corporation, provided that the
assignee or transferee is the successor to all or substantially all of the
assets of the Corporation and such assignee or transferee assumes the
liabilities, obligations and duties of the Corporation, as contained in
this Agreement, either contractually or as a matter of law. The Corporation
further agrees that, in the event of a sale of assets or liquidation as
described in the preceding sentence, it shall take whatever action it
legally can in order to cause such assignee or transferee to expressly
assume the liabilities, obligations and duties of the Corporation
hereunder. No rights or obligations of the Executive under this Agreement
may be assigned or transferred by the Executive other than his rights to
compensation and benefits, which may be transferred only by will or
operation of law, except as provided in Section 19 below.
12. Entire Agreement. This Agreement contains the entire understanding and
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agreement between the Parties concerning the subject matter hereof and
supersedes all prior agreements, understandings, discussions, negotiations
and undertakings, whether written or oral, between the Parties with respect
thereto.
13. Amendment or Waiver of this Agreement. No provision in this Agreement may
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be amended unless such amendment is agreed to in writing and signed by the
Executive and an authorized officer of the Corporation. No waiver by
either Party of any breach by the other Party of any condition or provision
contained in this Agreement to be performed by such other Party shall be
deemed a waiver of a similar or dissimilar condition or provision at the
same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Corporation, as the
case may be.
14. Other Rights or Remedies. No actions taken by either Party under the terms
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and conditions of this Agreement shall be deemed to be a waiver of any of
that Party's other rights or remedies available at law, in equity or
otherwise.
15. Governing Law. This Agreement shall be governed in all respects by and in
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accordance with the laws of the State of Maryland without reference to
the principles of conflict of laws.
16. Severability. The invalidity or unenforceability of any portion of this
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Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
17. Representations. The Corporation represents and warrants that it is fully
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authorized and empowered to enter into this Agreement and that the
performance of its obligations under this Agreement will not violate any
agreement between it and any other person, firm or organization or any
applicable law and that all necessary corporate actions have been taken to
duly authorize its entering into this Agreement. The Executive represents
that he knows of no agreement between him and any other person, firm or
organization that would be violated by the performance of his obligations
under this Agreement.
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18. Survivorship.
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The respective rights and obligations of the Parties hereunder shall
survive any termination of the Term to the extent necessary to the intended
preservation of such rights and obligations.
19. Beneficiaries/References. The Executive shall be entitled, to the extent
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permitted under any applicable law, to select and change a beneficiary or
beneficiaries to receive any compensation or benefit payable hereunder
following the Executive's death by giving the Corporation written notice
thereof. In the event of the Executive's death or a judicial determination
of his incompetence, reference in this Agreement to the Executive shall be
deemed, where appropriate, to refer to his beneficiary, estate or other
legal representative.
20. Notices. Any notice given to a Party shall be in writing and shall be
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deemed to have been given when delivered personally or sent by certified or
registered mail, postage prepaid, return receipt requested, overnight
courier service or facsimile with printed record of receipt by the
recipient's facsimile machine, duly addressed to the Party concerned at the
address indicated below or to such changed address as such Party may
subsequently give such notice of (and in the case of a facsimile sent to
the correct facsimile number):
If to the Corporation: LOCKHEED MARTIN CORPORATION
6801 Rockledge Drive
Bethesda, Maryland 20817
Attn: Frank H. Menaker, Jr.
Senior Vice President
and General Counsel
If to the Executive: Mr. Louis R. Hughes
c/o Lockheed Martin Corporation
6801 Rockledge Drive
Bethesda, Maryland 20817
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IN WITNESS WHEREOF, the parties have executed this Agreement as of April 3,
2000.
LOCKHEED MARTIN CORPORATION
By: /s/
April 3, 2000 ---------------------------
Date Name: Terry F. Powell
Title: Vice President, Human Resources
By: /s/
April 3, 2000 -----------------
Date Louis R. Hughes
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Exhibit A
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Boards of Directors
British Telecom plc
Deutsche Bank AG *
Electrolux AB *
*It is the intention of the Executive to resign from these boards at the
earliest practicable date.
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Exhibit B
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TERMS OF NON-STATUTORY STOCK OPTION AWARD
(The form of award, consistent with this term sheet, shall be recommended by
management for approval by the Stock Option Subcommittee of the Management
Development and Compensation Committee of the Board of Directors at its meeting
on April 27, 2000.)
1. Grant: An option to purchase 450,000 shares of the Common
Stock of the Corporation (the "Option Shares") shall be
granted as of April 27, 2000 ("Grant Date")
2. Exercise Closing price on the New York Stock Exchange
Price: on the Grant Date
3. Term: 10 years
4. Vesting and (a) Normal vesting and exercisability
Exercisability: schedule:
50% on the first anniversary of the Grant Date; another
50% on the second anniversary of the Grant Date.
(b) Vesting in accordance with the normal vesting schedule
upon the occurrence of any of the following:
- death
- Disability
- Termination without Cause
- Constructive Termination without Cause
(c) Full vesting upon the occurrence of a Change of Control
(d) Post-termination exercisability:
A vested option shall continue to be exercisable for
the remainder of its term except in the event of a
forfeiture as provided in the next paragraph.
(e) Forfeiture:
All options shall be forfeited upon a Termination for
Cause or a voluntary termination by the Executive
(other than a Constructive Termination without Cause).
5. Registration: Option Shares shall be registered, so as to be
fully tradeable, under the Securities Act of 1933.
6. Merger or Other The Option shall be exercisable as part of any merger
Reorganization: or other reorganization so as to permit the Executive
to participate in the merger or other reorganization on
the same basis as other shareholders
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Exhibit C
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TERMS OF RESTRICTED STOCK AWARD
(The form of award, consistent with this term sheet, shall be recommended by
management for approval by the Stock Option Subcommittee of the Management
Development and Compensation Committee of the Board of Directors at its meeting
on April 27, 2000.)
1. Grant: 50,000 shares of the Common Stock of the Corporation
(the "Restricted Shares") shall be granted on April 27, 2000
subject to restrictions as set forth below.
2. Lapse of Restrictions shall lapse as follows:
Restrictions:
(a) Normal lapsing schedule:
(i) Restrictions as to 16,667 shares shall lapse on the
second anniversary of the Grant Date.
(ii) Restrictions as to 33,333 shares shall lapse on the
fourth anniversary of the Grant Date.
(b) All restrictions shall lapse upon the occurrence of any
of the following:
- death
- Disability
- Termination without Cause
- Constructive Termination without Cause
- Change of Control
(c) Forfeiture:
All Restricted Shares shall be forfeited upon a
Termination for Cause or a Voluntary Termination by the
Executive (other than a Constructive Termination without
Cause).
3. Ownership The Executive shall be entitled to the rights of
Rights: ownership to the Restricted Shares, subject to the terms
of the grant, including but not limited to voting rights
and rights to receive dividends (if and as dividends are
paid).
4. Registration: Restricted Shares shall be registered under the
Securities Act of 1933 so as to be fully tradeable upon
lapsing of restrictions.
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Exhibit D
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TERM OF LONG TERM PERFORMANCE AWARD
(The form of award, consistent with this term sheet, shall be recommended by
management for approval by the Stock Option Subcommittee of the Management
Development and Compensation Committee of the Board of Directors at its meeting
on April 27, 2000).
1. Target Award: $2,000,000
2. Performance Period: 2000-2002
3. Performance Target: Determined by the Corporation's performance as measured
by its relative ranking in Total Stockholder Return to
Total Stockholder Return of the companies that comprise
the Standard & Poor's Index.
4. Vesting: (a) Normal vesting:
Award shall be 100% vested as of December 31,
2002.
(b) Vesting in accordance with the plan (with pro-rata
payout if event occurs prior to end of performance
period):
- death
- Disability
- Termination without Cause
- Constructive Termination
- Change in Control
(c) Forfeiture:
Award is forfeited upon a Termination for Cause or
Voluntary Termination by the Executive other than a
Constructive Termination without Cause.
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March 31, 2000
Mr. Louis R. Hughes
258 Walden Road
Glencoe, IL 60022
Dear Louis:
We are pleased to extend this offer of employment with Lockheed Martin
Corporation as President and Chief Operating Officer, reporting to me. You will
be recommended for election to the Board of Directors and as a Corporate Officer
at the April 2000 Board meeting. Your beginning annual base salary will be
$1,000,000, payable on a weekly basis, and you will participate in the
Corporation's Management Incentive Compensation Plan (MICP), beginning with the
current plan year, at a Target Award level of 100% of base salary. Actual
payments under the MICP are subject both to the individual's and the
Corporation's performance in any given year.
Effective with your employment, you will be granted 450,000 Options to purchase
shares of Lockheed Martin common stock; 50,000 Lockheed Martin Restricted Stock
shares (vesting in the restricted shares will be 1/3 of the grant after two
years and 2/3 after four years); and a Long Term Incentive Plan (LTIP) Target
Award of $2,000,000 for the 2000 through 2002 Performance Period (a summary
description of the LTIP program is attached). You will additionally be granted a
Special Termination Agreement.
Currently, Lockheed Martin reviews salaries, MICP and the long term components
of compensation (stock options and LTIP) annually, and your total compensation
components will be reviewed and adjusted accordingly, subject to recommendation
by the Chief Executive Officer, approval by the Management Development and
Compensation Committee and ratification by the Board.
Lockheed Martin provides an excellent offering of Employee Benefit programs,
including pension, 401(k) savings plan, healthcare coverage, etc. As a
Corporate Officer, you will also be eligible for other benefits and perquisites
afforded to elected officers of the Corporation, and an executive relocation
package (see attached).
Louis, we are pleased to have selected you for this important leadership
position at Lockheed Martin, and are excited about your joining our Executive
Management Team. We look forward to your acceptance of this offer of employment
with the Corporation.
Sincerely,
/s/______________
Vance D. Coffman
Acceptance: /s/ March 31, 2000
------------------- ----------------------
Louis R. Hughes Date
16
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EXHIBIT 10(b)
ADDENDUM 1
COVENANT NOT TO COMPETE, CONFIDENTIALITY and RELEASE AGREEMENT
Lockheed Martin Corporation (the "Corporation") and I, Peter B. Teets,
voluntarily enter into this Covenant Not to Compete, Confidentiality and Release
Agreement ("Agreement") and agree that all of these promises and obligations,
along with a three year consulting arrangement described in Addendum 2, are
adequately and collectively supported by good, sufficient consideration
described in the Letter, dated May 26, 2000 from Terry Powell, Vice President,
Human Resources to me ("Letter"), the terms of which are incorporated herein.
1. COVENANT NOT TO COMPETE. In exchange for the consideration described in the
---------------------------
Letter, I hereby agree, among other things, to restrict my employment and
business opportunities in essentially the same manner as they would have been
restricted had I remained employed by the Corporation during the three year
period commencing on May 1, 2000. I agree that the duty of loyalty that I owed
to the Corporation by virtue of my previous employment and position with the
Corporation shall continue to its fullest extent during these three years by
virtue of this Agreement. I shall continue to be governed by the same
principles that prohibit the Corporation's employees from engaging in personal
or family business activities constituting potential conflicts of interest,
including those outlined in CPS-712. Among other restrictions, I understand
that during this three year time period I will not, on my own or in association
with others, either (i) be directly or indirectly employed by or engage in or be
associated with or tender advice or services as an employee, advisor, director,
consultant or otherwise or (ii) seek or accept any financial or other personal
benefit, with or from, in either case, any corporation, partnership, or other
business entity competing with the Corporation in any area in which the
Corporation is conducting business on the date of my retirement. To the extent
that Draper Laboratory falls within the description of a "business entity
competing with the Corporation", the parties agree that my membership on the
Board of Directors of Draper Laboratory is excepted from this obligation. The
parties further agree and understand that this covenant not to compete does not
prohibit me from directly or indirectly owning up to one percent or less of the
listed or publicly held securities in a company that is a competitor of the
Corporation or holding investments of $100,000 or less in any such company that
is not publicly held. I currently have investment positions in corporations and
in mutual funds that have ownership positions in corporations which may compete
with the Corporation, and the Corporation agrees that these existing personal
business interests do not violate the terms of this Agreement. The parties
further agree that if I were to perform public service work on behalf of the
government, these services would not violate this Agreement.
I understand and agree that the duration and area for which these restrictions
are to be effective are fair and reasonable in light of the consideration paid
under this Agreement. I agree and acknowledge that these restrictions are
reasonably required for the protection of the Corporation's legitimate business
interests from unfair competition as a result of the high level executive and
management positions I have held within the Corporation and my attendant access
to and extensive knowledge of the Corporation's confidential and proprietary
property and information, including trade secrets, customer and supplier
relationships and good will.
It is the desire and intent of the parties that the provisions of this Covenant
Not to Compete shall be enforced to the fullest extent permissible under the
laws and public policies applied in each jurisdiction in which enforcement is
sought. Accordingly, if any particular portion of this Covenant Not to Compete
is adjudicated to be invalid or unenforceable, this Covenant Not to Compete
shall be deemed amended to delete therefrom the portion thus adjudicated to be
invalid
<PAGE>
or unenforceable, such deletion to apply only with respect to the operation of
this provision in the particular jurisdiction in which such adjudication is
made.
2. CONFIDENTIALITY. Throughout the duration of my employment with the
----------------------
Corporation, I have had access to and may have generated a substantial amount of
information that is proprietary and confidential to the Corporation.
Additionally, I may have had access to certain third-party proprietary
information that had been provided in confidence to the Corporation. In
consideration of my employment by the Corporation, I have undertaken an
obligation, both during and following my employment, not to use or disclose to
others, any Proprietary Information, except as authorized by the Corporation.
"Proprietary Information" means any information of the Corporation or of others
which has come into the Corporation's or my possession, custody or knowledge in
the course of my employment that has independent economic value as a result of
its not being generally known to the public and is the subject of reasonable
means to preserve the confidentiality of the information. Proprietary
Information includes (without limitation) information, whether written or
otherwise, regarding the Corporation's earnings, expenses, marketing
information, cost estimates, forecasts, bid and proposal data, financial data,
trade secrets, products, procedures, inventions, systems or designs,
manufacturing or research processes, material sources, equipment sources,
customers and prospective customers, business plans, strategies, buying
practices and procedures, prospective and executed contracts and other business
arrangements or business prospects, except to the extent such information
becomes readily available to the general public lawfully and without breach of a
confidential, contractual, or fiduciary duty. By signing this Agreement, I
acknowledge and agree that I have a continuing obligation to not use or disclose
Proprietary Information. Further, all materials to which I have had access, or
which were furnished or otherwise made available to me in connection with the
services performed for the Corporation shall be and remain the property of the
Corporation. All such materials, documents and information, including any
Proprietary Information and all reproductions thereof shall be returned by me
promptly to the Corporation upon request. The parties acknowledge and agree
that this confidentiality provision shall not affect my obligations to cooperate
with any U.S. government investigation or to respond truthfully to any lawful
governmental inquiry or to give truthful testimony in court.
3. RELEASE.
-------------
Claims not Released. By this Agreement, I am not releasing any rights to
--------------------
benefits I may have under any of the Corporation's benefit programs (such as the
pension plan or any deferred compensation plans).
Claims Released. Subject only to the exception noted in the previous paragraph,
----------------
I agree to waive and fully release all claims of any nature ("Claims") that I
may now have or have had against the Corporation, its affiliates, subsidiaries,
fiduciaries and the directors, officers, employees, shareholders and agents of
any of the foregoing ("Released Parties"). These Claims released include, but
are not limited to, claims that in any way relate to my employment with the
Corporation or the termination of that employment, and any claims for monetary
damages or other personal remedy sought in any legal proceeding or charge filed
with any court, federal, state or local agency either by me or by a person
claiming to act on my behalf or in my interest. I understand that the Claims I
am releasing expressly include but are not limited to any age discrimination
claims under the ADEA. I warrant that I have not assigned or transferred any
Claims described in this Agreement to any third parties.
2
<PAGE>
4. OTHER PROVISIONS
--------------------
The parties agree that this Agreement prohibits my ability to pursue any Claims
or charges against the Released Parties seeking monetary relief or other
remedies for myself and/or as a representative on behalf of others. This
agreement does not affect my ability to cooperate with any future ethics, legal
or other investigations, whether conducted by the Corporation or any
governmental agencies.
A determination by a court or arbitrator that any provision of this Agreement is
invalid, illegal or unenforceable shall not affect the validity, legality or
enforceability of any other provision of this Agreement.
With the exception of my Consulting Agreement, this Agreement supersedes any
other prior agreements or representations between me and the Corporation as to
the subjects covered herein. This Agreement may be modified, supplemented or
superseded only in a written document signed by both parties.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Maryland, without giving effect to the choice of law or conflict of
law principles thereof.
By signing below, in addition to releasing all Claims described herein, I
acknowledge that:
a) I have been advised to consult with an attorney prior to signing this
Agreement;
b) I have been given at least 21 days to consider the actual terms of this
Agreement.
c) I understand that I may revoke this Agreement within seven (7) calendar days
from the date of signing, in which case this Agreement shall be null and void
and of no force and effect on the Corporation or me. I further understand and
acknowledge that to be effective, the revocation must be in writing and either
personally delivered to the Corporation in the care of Terry Powell, Vice
President, Human Resources, whose office is located at the following address:
6801 Rockledge Drive, Bethesda, MD 20817, or sent via certified mail, return
receipt requested, to Lockheed Martin Corporation, Attention: Terry Powell, Vice
President, Human Resources at the same address so that it is received by the
Corporation by 5:00 p.m. on or before the seventh (7th) calendar day after I
sign this Agreement.
d) I have read this Agreement, and I am fully aware of the legal effects of the
Agreement. I have chosen to execute the Agreement freely, without reliance upon
any promises or representations made by the Corporation other than those
contained in this Agreement and the Letter.
3
<PAGE>
SIGNED this 27th day of May, 2000.
/s/ Peter B. Teets
____________________________________ --------------------------------------
Signature Printed name
-------------------------------------------------------------------------------
ACCEPTED AND AGREED TO BY LOCKHEED MARTIN CORPORATION ON
May 27, 2000 (date)
BY: /s/ TITLE: Vice President, Human Resources
---------------------------- -------------------------------
Terry F. Powell
4
<PAGE>
ADDENDUM 2
CONSULTANT SERVICES AGREEMENT between LOCKHEED MARTIN CORPORATION, a Maryland
corporation, (hereinafter "COMPANY"), and Peter B. Teets (hereinafter
"CONSULTANT"). In consideration of the promises and mutual obligations
hereafter set forth, the parties hereto agree as follows:
AGREEMENT
---------
1. EFFECTIVITY AND CONTENT
A. AGREEMENT is entered into as of June 1, 2000 by and between COMPANY and
CONSULTANT and consists of this Agreement and Exhibits A through C as listed
below, and incorporated herein by reference.
B. This Agreement is entered into by COMPANY for the purpose of retaining the
services of Peter B. Teets as a CONSULTANT. This Agreement is conditioned on the
CONSULTANT'S assent to, and strict compliance with, all of the terms and
conditions stated below.
2. ORDER OF PRECEDENCE
In the event of any conflict, the controlling document shall be determined by
the following order of precedence:
A. This Agreement
B. Exhibit A: Statement of Work
C. Exhibit B: Lockheed Martin Code of Ethics and Business Conduct, "Setting the
Standard"
D. Exhibit C: Consultant Activity Report (C-703-2)
3. COMPLIANCE WITH LAWS
A. By execution of this Agreement, CONSULTANT does (for each individual
performing services under this Agreement) now so certify and promise full
compliance with the provisions of all certifications, forms, contractual
provisions, and laws and regulations pertaining to the performance of services
by CONSULTANT.
B. CONSULTANT agrees to defend, indemnify and hold COMPANY harmless from any
claim, suit, loss, cost, damage, expense (including attorney's fees) or
liability by reason of CONSULTANT'S violation of any such law, order or
regulation. Nothing in this Agreement or in any requirement under this
Agreement shall be construed to mean that CONSULTANT should perform such work in
violation of any law, statute, code, or ordinance.
5
<PAGE>
4. PERIOD OF PERFORMANCE
The period of performance hereunder shall commence on June 1, 2000 and shall
terminate on May 31, 2003. COMPANY shall not be responsible for work performed
beyond the term of this Agreement.
5. DUTIES OF CONSULTANT
For the term of this Agreement, CONSULTANT shall provide consulting services on
a "best efforts" basis to COMPANY as set forth in Exhibit A, "Statement of
Work," at such COMPANY facilities and other locations as the performance of
services hereunder may require.
6. AGREEMENT MONITOR
CONSULTANT'S primary contact with COMPANY shall be Terry Powell, referred to
hereinafter as the "Agreement Monitor".
7. COMPENSATION FOR SERVICES
A. As full compensation for the services to be performed by CONSULTANT during
the entire term of this Agreement, COMPANY agrees to pay CONSULTANT a lump
sum fee of $950,000 per year for services to be rendered. This amount
represents the collective consideration for the Covenant Not to Compete,
Confidentiality and Release Agreement as well as for consulting services to
be rendered under this Agreement. The parties agree that the exact number of
hours to be worked per year by CONSULTANT under this Agreement is unknown,
but may be as many as 1,000 hours per year.
B. With prior approval of the Agreement Monitor, COMPANY shall reimburse
Consultant for:
(i) Reasonable travel expenses incurred in performance hereunder. First class
air travel will be allowed. All other expenses for travel, including lodging,
meals and incidental expenses shall be considered reasonable and allowable
only to the extent that they do not exceed the maximum per diem rate in
effect at the time of travel as set forth in the Federal Travel Regulations
for the area of travel covered by this Agreement.
(ii) Entertainment expenses and any other expenses shall be reimbursed only
when approved in advance by COMPANY. In connection therewith, CONSULTANT
shall strictly observe:
(a) Applicable restrictions relating to the entertainment of military
and government officials and employees and to the giving of any thing of
value to such officials and employees; and
(b) Applicable restrictions relating to the entertainment of and to the
giving of any thing of value to Members of Congress, Congressional
staff, and employees of Congress.
C. CONSULTANT shall attach to submitted invoices receipts and explanations for
any of the following expenditures in excess of $25.00: Travel expenses,
including expenditures for hotels, meals, air or rail fare, taxis, car rental
(at locations other than CONSULTANT'S office), mileage for use of personal
automobile, parking and toll fees, and telephone.
D. The total expenses to be paid under this Agreement shall not exceed $40,000
per year.
6
<PAGE>
8. LIMITATION OF OBLIGATION
COMPANY shall not be obligated to make payment to CONSULTANT in excess of the
funding limitation set forth in paragraph 7 above and CONSULTANT shall not be
obligated to continue performance under this Agreement in excess of the funding
limitation set forth in paragraph 7 above, unless and until COMPANY shall have
notified CONSULTANT in writing that such funding limitation has been increased
and shall have specified in such notice a revised funding limitation which shall
thereupon constitute the funding limitation for performance of this Agreement.
9. PAYMENT AND INVOICE
A. COMPANY shall pay CONSULTANT for reasonable expenses incurred in connection
with services performed hereunder within thirty (30) days following receipt and
approval of a proper invoice. With each invoice, CONSULTANT shall submit a
"Consultant Activity Report," form No. C-703-2, attached hereto as Exhibit C,
for the period covered by the invoice. The invoice must contain an itemized
breakdown of any time spent under this Agreement, segregating any efforts to
influence or attempt to influence federal actions from activities not involving
efforts to influence federal actions. For invoices claiming reimbursement for
expenses, CONSULTANT is required to attach receipts for any expenditures in
excess of $50.00 in a form satisfactory to COMPANY.
B. Each invoice submitted shall also contain the following statement:
"Submission of this invoice certifies compliance with the terms and conditions
of the consulting agreement under which this invoice is submitted, and certifies
compliance with all laws, regulations and Lockheed Martin policies and
procedures referenced therein."
C. Invoices and required supporting documentation shall be submitted to:
LOCKHEED MARTIN CORPORATION
6801 Rockledge Drive
Bethesda, Maryland 20817
Attention: Terry Powell (Agreement Monitor)
D. Invoices not in compliance with the requirements of this section shall be
returned to the CONSULTANT for correction and resubmittal.
10. INDEPENDENT CONTRACTOR
Neither this Agreement nor CONSULTANT'S performance hereunder shall constitute
or create an employee/employer relationship. CONSULTANT shall not be eligible
for any benefits applicable to active employees of COMPANY. CONSULTANT shall
act solely as an independent contractor, not as an employee or agent of COMPANY.
CONSULTANT'S authority is limited to providing consulting services, and
CONSULTANT shall have no authority, without the express written consent of
COMPANY, to incur any obligation or liability, or make any commitments on behalf
of COMPANY.
11. PROPRIETARY AND SENSITIVE INFORMATION
COMPANY may, from time to time, furnish CONSULTANT with literature, data, or
technical information which COMPANY considers necessary to the CONSULTANT for
the performance
7
<PAGE>
of services pursuant to this Agreement. In the event any of the furnished
material is proprietary or sensitive, COMPANY shall so inform CONSULTANT and
CONSULTANT agrees to disclose this information only to individuals or
organizations approved by COMPANY. CONSULTANT also agrees to return all such
materials as COMPANY may request upon the expiration or termination of this
Agreement, whichever shall occur first.
12. ACCESS TO CLASSIFIED INFORMATION
Performance of this Agreement may require access to classified information
involving National Security up to and including Top Secret. If access is
required, CONSULTANT shall furnish the COMPANY Security Department with all data
required to obtain or verify a personal security clearance with access to TOP
SECRET. Notwithstanding any provision of this Agreement to the contrary,
CONSULTANT shall not perform work involving access to classified information
until CONSULTANT'S security clearance has been obtained or verified by COMPANY.
13. GOVERNMENT AND COMPETITOR DATA AND INFORMATION
CONSULTANT agrees that he shall not solicit, attempt to obtain, or receive any
information that is unclassified, security classified or procurement sensitive,
directly or indirectly, from the U.S. government or any other source, except in
strict accordance with all laws and regulations and COMPANY policies and
procedures, or where there is reason to believe that such information cannot
lawfully be in COMPANY'S possession. The same prohibitions apply to information
of another company that is confidential, proprietary, or competitive
information. For the purpose of this Agreement, the term "information" includes
documents, video and audio materials, oral transmissions, electronic data, and
any other method or means by which information might be conveyed.
14. INTELLECTUAL PROPERTY
CONSULTANT agrees to assign, convey and transfer to COMPANY without requirement
for further consideration, each and every invention, discovery, patent and
improvement relating to the field of effort covered by the Statement of Work,
conceived or developed by CONSULTANT during performance of the Agreement and
upon request shall execute any required papers and furnish all reasonable
assistance to COMPANY to vest all right, title and interest in such matters in
COMPANY.
15. CERTIFICATIONS AND REPRESENTATIONS
A. By execution of this Agreement, CONSULTANT represents and certifies that he
has not been convicted of or pleaded guilty to a federal offense involving
fraud, corruption or moral turpitude and is not now listed by any federal agency
as debarred, suspended, proposed for suspension or debarment, or otherwise
ineligible for federal procurement programs. If CONSULTANT is a corporation,
partnership or other form of business organization, the representations and
certification shall apply not only to the individual(s) who shall be performing
the consulting services, but also to the principal officers and owners of the
business organization.
B. In performing this Agreement, CONSULTANT agrees to comply with applicable
laws and regulations and to not make or permit to be made or knowingly allow a
third party to make any improper payments, or to perform any unlawful act.
C. When requested to do so by COMPANY, CONSULTANT agrees to provide supporting
information and to execute certifications as may be required to permit COMPANY
to fully
8
<PAGE>
comply with applicable government regulations which may become effective during
the term of this Agreement.
D. Failure or refusal to furnish in a timely manner any required certificate or
disclosure upon request from either COMPANY or a U.S. government procurement
authority shall be the basis for immediate termination of this Agreement.
CONSULTANT further agrees that with regard to all certifications contained
herein or executed as part of this Agreement, CONSULTANT shall notify COMPANY
promptly of any change in CONSULTANT'S status. Failure to provide prompt notice
shall be cause for immediate termination of this Agreement.
E. CONSULTANT represents that he has made full disclosure of each instance where
CONSULTANT has provided a supplier, customer, or competitor of COMPANY services
similar to those provided for hereunder during a period of twelve (12) months
prior to the date of this Agreement.
F. Compliance with Contracting Restrictions:
(i) CONSULTANT certifies that he is familiar with and shall comply with all
federal laws and regulations relating to federal conflict of interest
("Revolving Door") concerns.
(ii) CONSULTANT further certifies that, to the best of his knowledge and
belief, CONSULTANT is not prohibited by law from performing services
contracted for under this AGREEMENT.
G. CONSULTANT represents that he shall not, in performance under this Agreement
(unless modified, as noted below), have any contact with any foreign COMPANY
customer or any foreign government official for the purpose of collecting
marketing intelligence or providing marketing-related services for markets
outside the U.S. In the event that COMPANY determines during the course of this
Agreement that it needs CONSULTANT to perform services hereunder that may
involve such marketing-related contact with a foreign customer or foreign
government official, then prior to such contact, the parties will modify this
Agreement in writing and otherwise take the necessary steps to comply with the
COMPANY'S policies governing International Consultants, including CPS-704.
H. CONSULTANT acknowledges receipt of a copy of COMPANY'S Code of Ethics and
Business Conduct, "Setting the Standard," attached hereto as Exhibit B.
CONSULTANT represents that he shall comply with all applicable provisions
thereof.
I. Compliance with Lobbying Prohibitions:
(i) CONSULTANT represents that he shall comply with 31 U.S. Code 1352 and
implementing regulations contained in the Federal Acquisition Regulation
(FAR) which prohibits use of federal appropriated funds to influence or
attempt to influence any federal actions. CONSULTANT represents that he shall
promptly inform COMPANY of any instance which may involve efforts to
influence or attempt to influence agency or congressional personnel with
respect to federal action (as these terms are defined by Section 1352 and its
implementing regulations). CONSULTANT represents that his invoices shall
separately identify any time spent under this Agreement for such efforts in
the form set forth in Section 9 of this Agreement.
(ii) CONSULTANT represents that he shall not engage in any effort on behalf
of COMPANY to lobby (i.e., to influence or attempt to influence) Congress,
any federal agency,
9
<PAGE>
any Member of Congress, any federal officer, or any federal agency employee
or employee of a Member of Congress, unless such activity is expressly
directed or approved by the Agreement Monitor in writing.
16. GRATUITIES/KICKBACKS
No gratuities (in the form of entertainment, gifts or otherwise) or kickbacks
shall be offered or given by CONSULTANT, to any employee of COMPANY with a view
toward securing favorable treatment as a contractor.
17. PERSONAL PERFORMANCE REQUIREMENT
CONSULTANT shall personally perform the consulting services described and shall
not assign to any third party the performance obligation or any rights to
compensation or benefits accruing to CONSULTANT under this Agreement without the
written consent of COMPANY.
18. RECORDS AND AUDIT
The CONSULTANT agrees to retain for a period of three (3) years from final
payment hereunder, books, records, documents and other evidence pertaining to
the costs and expenses of this Agreement (hereinafter collectively called the
"records") to the extent and in such detail as shall properly reflect all net
costs, direct and indirect, of labor, materials, equipment, supplies and
services, and other costs and expenses of whatever nature for which payment is
claimed under the provisions of this Agreement. The CONSULTANT agrees to make
available at the office of the CONSULTANT at all reasonable times during such
retention period any of the records for inspection, audit or reproduction by any
representative authorized by COMPANY. The term "records" shall also include work
product, trip reports (indicating persons visited and subjects discussed),
minutes of meetings, collateral memoranda, and related documents.
19. ASSIGNMENT
Neither this Agreement nor any interest herein shall be assignable by the
CONSULTANT. COMPANY reserves the right to assign its rights and obligations
hereunder to any subsidiary, affiliate, or successor in interest.
20. TERMINATION
A. Neither party may unilaterally terminate this Agreement without cause as
described further below. The parties may terminate the agreement by mutual
agreement provided the termination is in writing and signed by both parties. In
the event of termination, COMPANY'S obligations shall be limited to fees paid
by COMPANY and expenses incurred by CONSULTANT as of the effective date of
termination. Any reports in progress at the time of termination shall be
submitted by CONSULTANT to COMPANY at no additional fee.
B. This Agreement shall terminate for cause immediately and all payments made
or due shall be forfeited by CONSULTANT if, in rendering services hereunder,
improper payments are made, unlawful conduct is engaged in, or any part of the
fee or expenses payable under this Agreement is used for an illegal purpose.
This Agreement shall terminate for cause immediately and all payments made or
due shall be forfeited by CONSULTANT if CONSULTANT revokes the Covenant Not to
Compete, Confidentiality and Release Agreement, between himself and the
10
<PAGE>
COMPANY, within the 7-day revocation period following CONSULTANT'S execution of
that Agreement.
21. AMENDMENTS AND NOTICES
A. Only the Agreement Monitor or the COMPANY'S Procurement Representative have
the authority to make changes in or amendments to this Agreement on behalf of
COMPANY and to effect deviations (by the way of addition or deletion) from the
work herein specified. Changes in or amendments to this Agreement shall have no
effect unless they are in writing and signed by the COMPANY'S authorized
representative or designee and the CONSULTANT.
B. Except as otherwise specifically provided herein, any notices to be
furnished by CONSULTANT to COMPANY or by COMPANY to CONSULTANT shall be sent by
mail or FAX addressed respectively as follows:
To COMPANY:
-----------
ATTN: Terry Powell
LOCKHEED MARTIN CORPORATION
6801 Rockledge Drive
Bethesda, Maryland 20817
To CONSULTANT:
--------------
ATTN: Peter B. Teets
11118 Cripplegate Rd.
Potomac, MD 20854
22. ENTIRE AGREEMENT AND CHOICE OF LAW
This Agreement, together with all amendments: (a) shall be construed in
accordance with the laws of the State of Maryland; excluding its choice of law
rules and (b) together with the Letter dated May 26, 2000 from Terry Powell to
CONSULTANT and the Covenant Not to Compete, Confidentiality and Release
Agreement, constitutes the entire understanding of the parties concerning its
subject matter; (c) may be altered or amended only in writing signed by both
parties concurrently with or subsequent to its dae of execution; and (d)
together with the Letter dated May 26, 2000 from Terry Powell to CONSULTANT and
the Covenant Not to Compete, Confidentiality and Release Agreement supersedes
all prior written or oral understandings of the parties (including predecessors
or assigns) concerning its subject matter.
23. WAIVER
The failure of COMPANY in any one or more instances to insist upon performance
of any of the provisions of this Agreement shall not be construed a waiver of
such provisions with regard to future performance.
24. REMEDIES
The rights and remedies provided herein shall be cumulative and in addition to
any other rights and remedies provided by law or equity.
11
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
the 27th day of May, 2000.
CONSULTANT COMPANY
/s/ /s/
-------------------------- --------------------------
Peter B. Teets Terry Powell
Vice President, Human Resources
Lockheed Martin Corporation
12
<PAGE>
ADDENDUM 2
EXHIBIT A
TO CONSULTANT SERVICES AGREEMENT
STATEMENT OF WORK
CONSULTANT shall provide services on an as needed basis during the term of this
Agreement as requested by the COMPANY'S CEO or the Agreement Monitor. The
assignments will vary, but will include services such as providing management
and technical advice and guidance, representing Lockheed Martin Corporation by
participating in industry association affairs, boards, and other business
events, and serving on special projects and review teams.
13
<PAGE>
ADDENDUM 2
EXHIBIT B
TO CONSULTANT SERVICES AGREEMENT
SEE ATTACHED: LOCKHEED MARTIN CODE OF ETHICS AND BUSINESS CONDUCT "SETTING THE
STANDARD"
14
<PAGE>
ADDENDUM 2
EXHIBIT C
TO CONSULTANT SERVICES AGREEMENT
SEE ATTACHED: CONSULTANT ACTIVITY REPORT (C-703-2)
15