Exhibit 10(u)
RETENTION AGREEMENT
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AGREEMENT entered into effective as of November 1, 1997 between Lockheed
Martin Corporation (the "Corporation") and [ ] (the "Executive").
Whereas the Corporation wishes to assure that it retains the continued services
of the Executive for the strategically important [ ] competition, the
Corporation and Executive agree as follows:
1. RETENTION PERIOD
This Agreement shall become effective as of November 1, 1997, and shall end
on December 31, 2001. The period during which this Agreement is effective
shall be known as the "Retention Period."
2. NATURE OF EMPLOYMENT
During the Retention Period the Executive agrees to continue to perform and
discharge faithfully his duties as the []. The Executive agrees to devote
his full attention to the business of the Corporation and shall not engage
in any other business activity whether or not that business activity is
pursued for gain, profit or other pecuniary advantage.
3. RETENTION BONUS
In addition to the compensation and benefits otherwise payable to the
Executive, the Executive is eligible to receive a Retention Bonus in
accordance with the following terms and conditions:
a. Completion of Retention period and [ ] Win.
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Subject to Section 3(d), if the Executive remains employed through the
completion of the Retention Period and the Company wins the [ ]
competition, the Executive will receive a lump-sum retention bonus
equal to two times Base Salary and Average Bonus. The retention bonus
shall be paid as soon as practicable following completion of the
Retention Period.
b. Completion of Retention Period and [ ] Loss.
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If the Executive remains employed through the completion of the
Retention Period and the Corporation does not win the [ ] competition,
he will receive a lump-sum retention bonus equal to the amount
calculated in Section 3(a), reduced by one-third (1/3). The retention
bonus shall be paid as soon as practicable following completion of the
Retention Period.
c. Termination for Reasons other than Good Cause or Substantial and
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Serious Cause. If the Executive dies, becomes disabled or resigns for
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reasons other than Good Cause prior to completion of the Retention
Period, he (or his estate, if applicable) will receive a lump-sum
retention bonus equal to the amount calculated under Section 3(a),
reduced by one-third (1/3) and further reduced on a pro-rata basis for
each day by which the Executive's death disability or resignation date
precedes December 31, 2001. The retention bonus shall be paid as soon
as practicable following the Executive's death, disability or
resignation.
d. Delay in [ ] Award. If the [ ] award decision is delayed beyond
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December 31, 2001, a retention bonus calculated under Section 3(b)
shall be paid to the Executive as soon as practicable following
completion of the Retention Period. If the Company wins the [ ]
competition, an additional amount equal to the difference between the
amount paid pursuant to the preceding sentence and the amount payable
under Section 3(a) shall be paid as soon as practicable following the
award decision. Notwithstanding the foregoing, the Compensation
Committee of the Company's Board of Directors may, in its sole
discretion, elect to pay such additional amount prior to the receipt
of the award decision. Any such payment will be final and not subject
to repayment to the Company by the Executive if the Company does not
win the [ ] competition.
e. Termination By Corporation For Substantial and Serious Cause. If,
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prior to the completion of the Retention Period, the Executive's
employment is terminated by the Corporation for Substantial and
Serious Cause, no retention bonus will be payable and no further
obligation under this Agreement shall exist on the part of the
Corporation (or its Affiliates) to the Executive.
f. Termination By Corporation For Other than Substantial and Serious
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Cause or Resignation by Executive For Good Cause. If, prior to the
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completion of the Retention Period, the Executive's employment is
terminated by the Corporation for any reason other than Substantial
and Serious Cause or the Executive resigns for Good Cause, the
Corporation shall pay to the Executive a retention bonus equal to the
retention bonus payable under Section 3a as soon as practicable
following the Executive's termination of employment. Additionally,
the Corporation may unilaterally terminate this Agreement at any time,
in which case the Corporation shall pay to the Executive a retention
bonus equal to the retention bonus payable under Section 3a as soon as
practicable following the termination of the Agreement.
g. Definitions.
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For the purpose of this Section 3,
AVERAGE BONUS shall mean the greater of (i) the average of the
Executive's annual bonuses awarded (regardless of when paid) during
the three year period ending on December 31, 2001(or the December 31
preceding or coinciding with his date of termination of employment
prior to December 31, 2001) under the Lockheed Martin Corporation
Management Incentive Compensation Plan ("MICP"), or (ii) the average
of the Executive's annual MICP bonuses awarded (regardless of when
paid) during the three year period ending on December 31, 1997.
BASE SALARY shall be the greater of (i) Executive's
Base Salary on December 31, 2001 (or the day immediately preceding his
termination of employment prior to such date) or (ii) his Base Salary
on December 31, 1997.
GOOD CAUSE shall mean any of the following, if undertaken without the
consent of the Executive:
Assignment of duties inconsistent with the position, duties,
responsibilities and status of an executive of the Corporation;
Reduction of reporting responsibilities, or titles from those
previously held with the Corporation;
Reduction in the amount of the Executive's salary from the salary
previously paid to the Executive by the Corporation, or reduction in
the Executive's bonus target from the bonus previously targeted for
the Executive by the Corporation;
Notwithstanding the foregoing, Good Cause shall not include
termination by the Corporation for Substantial and Serious Cause or
any act taken by the Corporation in furtherance of its obligations
under the Administrative Agreement between the Corporation and the
United States Air Force, entered into in June 1995.
SUBSTANTIAL AND SERIOUS CAUSE shall mean the Executive's final
conviction of a felony or Federal offense involving fraud, corruption,
or moral turpitude; the Executive's engaging in willful fraud or
defalcation involving material funds or other assets of the
Corporation; or the debarment of the Executive or the Executive
engaging in any other offense described in Administrative Agreement
between the Corporation and the United States Air Force, entered into
in June 1995.
A WIN of the [ ] competition shall mean an award to the Corporation of
any portion of the [ ] program.
4. DISCLOSURE OF INFORMATION AND INTELLECTUAL PROPERTY
a. 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.
The Executive shall not, during or after the Retention Period, 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 after the Executive's employment
terminates, the restrictions shall not apply to such Proprietary
Information which are 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.
b. The Executive shall disclose promptly and fully to the Corporation all
innovations, inventions, works of authorship prepared by him within
the scope of his employment, and any other items of intellectual
property ("Intellectual Property"), whether or not patentable,
copyrightable or registrable, that have been conceived, made or
authored by him solely or jointly with others during the period of his
employment with the Corporation: (i) which relate to the business or
investigations of the Corporation or its affiliates; (ii) which result
from any work that the Executive may do for or on behalf of the
Corporation; (iii) which result from any Proprietary Information that
may have been made available to the Executive; or (iv) that are
otherwise made through the use of the Corporation's time, facilities
or materials. All such Intellectual Property shall be the sole and
exclusive property of
the Corporation. The Executive hereby assigns all of his right, title
and interest to such Intellectual Property to the Corporation.
5. COVENANT NOT TO COMPETE
For a period ending twelve months from and after the termination of the
Executive's employment during the Retention Period, the Executive shall not
engage in any business (whether as an officer, director owner, employee,
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 such termination of employment. For such period, the
Executive shall also not interfere with, disrupt, or attempt to disrupt the
relationship, contractual of otherwise, between the Corporation and any
customer, supplier or employee of the Corporation.
It is the desire and intent of the parties that the provisions of this
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 Section 5 shall be
adjudicated to be invalid or unenforceable, this Section shall be deemed
amended to delete therefrom the portion thus adjudicated to be invalid or
unenforceable, such deletion to apply only with respect to the operation of
this Section in the particular jurisdiction in which such adjudication is
made.
6. NON-WAIVER OF OTHER RIGHTS OR REMEDIES
No actions taken by the Corporation under the terms and conditions of this
Agreement shall be deemed to be a waiver of any of its other rights or
remedies available at law, in equity or otherwise.
7. ASSUMPTION AND ASSIGNABILITY OF AGREEMENT
The Executive may not delegate, subcontract or otherwise transfer or assign
his rights or obligations under this Agreement. The rights and obligations
of the Corporation
under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of the Corporation.
8. AMENDMENT
This Agreement may not be modified, changed or altered except in writing
signed by both the Executive and the Corporation.
9. MEDIATION
The parties shall attempt in good faith to resolve any dispute (other than
a dispute under 4 or 5) arising out of or relating to this Agreement
promptly by negotiation. Any party may give the other party written notice
of any dispute not resolved in the normal course of business. Within 15
days after delivery of the notice, the receiving party shall submit to the
other a written response. The notice and the response shall include (i) a
statement of each party's position and a summary of arguments supporting
that position, and (ii) the name and title of the individual who will
represent that party. Within thirty (30) days after delivery of the
disputing party's notice, the representatives of both parties shall meet at
a mutually acceptable time and place, and thereafter as often as they
reasonably deem necessary, to attempt to resolve the dispute. All
reasonable requests for information made by one party to the other will be
honored. If the dispute has not been resolved by negotiation within sixty
(60) days of the disputing party's notice, or if the parties fail to meet
within thirty (30) days, the parties shall endeavor to settle the dispute
by mediation under CPR Model Mediation Procedure for Business Disputes in
effect on the date of this Agreement. The time periods contained in this
paragraph may be extended by mutual consent.
10. INJUNCTION
If there is a breach or threatened breach of the provisions of Section 4 or
5, the Corporation shall be entitled to 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. However, nothing herein should be construed as requiring the
Corporation to mediate its claims under Section 9 above prior to seeking
the injunction.
12. GOVERNING LAW
This Agreement shall be governed in all respects by and in accordance with
the laws of the State of Maryland.
13. SEPARABILITY
The invalidity or unenforceability of any portion of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as of
November 1, 1997.
LOCKHEED MARTIN CORPORATION
By:
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Robert B. Corlett
Vice President
Human Resources
ADDENDUM TO RETENTION AGREEMENT
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This Addendum is entered into effective as of November 1, 1997, by and
between Lockheed Martin Corporation (the "Corporation") and [ ]. (the
"Executive").
Whereas the Corporation and the Executive are parties to a Retention
Agreement dated as of November 1, 1997 (the "Agreement"); and
Whereas the Corporation and the Executive wish to clarify the term of the
Covenant Not to Compete set forth in Section 5 of the Agreement.
NOW THEREFORE, the Corporation and the Executive agree that the first
sentence of Section 5 of the Agreement is revised to read as follows:
For a period ending upon the earlier of (i) the [ ] award decision or (ii)
twelve months from and after the termination of the Executive's employment
during the Retention Period, the Executive shall not engage in any business
(whether as an officer, director owner, employee, 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 such
termination of employment.
IN WITNESS WHEREOF, the parties have executed this Addendum effective as of
November 1, 1997.
LOCKHEED MARTIN CORPORATION
By:
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Robert B. Corlett
Vice President
Human Resources
Date: December ___, 1997 Date: December ___, 1997