|
|
|
|
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
Maryland
|
|
52-1893632
|
||
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
||
|
|
|
|
|
6801 Rockledge Drive,
|
Bethesda,
|
Maryland
|
|
20817
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
Common Stock, $1 par value
|
LMT
|
New York Stock Exchange
|
|
|
|
|
Page
|
|
|
||
|
|||
|
|
|
|
|
ITEM 1.
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
ITEM 2.
|
||
|
|
|
|
|
ITEM 3.
|
||
|
|
|
|
|
ITEM 4.
|
||
|
|
||
|
|||
|
|
|
|
|
ITEM 1.
|
||
|
|
|
|
|
ITEM 1A.
|
||
|
|
|
|
|
ITEM 2.
|
||
|
|
|
|
|
ITEM 6.
|
||
|
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
|
|
|
|
|
|
||||
Products
|
|
$
|
13,166
|
|
|
|
$
|
11,970
|
|
|
|
Services
|
|
2,485
|
|
|
|
2,366
|
|
|
|
||
Total net sales
|
|
15,651
|
|
|
|
14,336
|
|
|
|
||
Cost of sales
|
|
|
|
|
|
|
|
||||
Products
|
|
(11,742
|
)
|
|
|
(10,625
|
)
|
|
|
||
Services
|
|
(2,213
|
)
|
|
|
(2,047
|
)
|
|
|
||
Other unallocated, net
|
|
395
|
|
|
|
524
|
|
|
|
||
Total cost of sales
|
|
(13,560
|
)
|
|
|
(12,148
|
)
|
|
|
||
Gross profit
|
|
2,091
|
|
|
|
2,188
|
|
|
|
||
Other income, net
|
|
31
|
|
|
|
95
|
|
|
|
||
Operating profit
|
|
2,122
|
|
|
|
2,283
|
|
|
|
||
Interest expense
|
|
(148
|
)
|
|
|
(171
|
)
|
|
|
||
Other non-operating income (expense), net
|
|
56
|
|
|
|
(167
|
)
|
|
|
||
Earnings before income taxes
|
|
2,030
|
|
|
|
1,945
|
|
|
|
||
Income tax expense
|
|
(313
|
)
|
|
|
(241
|
)
|
|
|
||
Net earnings
|
|
$
|
1,717
|
|
|
|
$
|
1,704
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings per common share
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
6.10
|
|
|
|
$
|
6.03
|
|
|
|
Diluted
|
|
$
|
6.08
|
|
|
|
$
|
5.99
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash dividends paid per common share
|
|
$
|
2.40
|
|
|
|
$
|
2.20
|
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net earnings
|
|
$
|
1,717
|
|
|
|
$
|
1,704
|
|
|
|
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
||||
Recognition of previously deferred postretirement benefit plan amounts
|
|
110
|
|
|
|
227
|
|
|
|
||
Other, net
|
|
(97
|
)
|
|
|
—
|
|
|
|
||
Other comprehensive income, net of tax
|
|
13
|
|
|
|
227
|
|
|
|
||
Comprehensive income
|
|
$
|
1,730
|
|
|
|
$
|
1,931
|
|
|
|
|
|
March 29,
2020 |
|
December 31,
2019 |
||||||
|
|
(unaudited)
|
|
|
|
|||||
Assets
|
|
|
|
|
|
|
||||
Current assets
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,988
|
|
|
|
$
|
1,514
|
|
|
Receivables, net
|
|
2,892
|
|
|
|
2,337
|
|
|
||
Contract assets
|
|
10,189
|
|
|
|
9,094
|
|
|
||
Inventories
|
|
3,539
|
|
|
|
3,619
|
|
|
||
Other current assets
|
|
614
|
|
|
|
531
|
|
|
||
Total current assets
|
|
19,222
|
|
|
|
17,095
|
|
|
||
Property, plant and equipment, net
|
|
6,605
|
|
|
|
6,591
|
|
|
||
Goodwill
|
|
10,565
|
|
|
|
10,604
|
|
|
||
Intangible assets, net
|
|
3,142
|
|
|
|
3,213
|
|
|
||
Deferred income taxes
|
|
3,164
|
|
|
|
3,319
|
|
|
||
Other noncurrent assets
|
|
6,550
|
|
|
|
6,706
|
|
|
||
Total assets
|
|
$
|
49,248
|
|
|
|
$
|
47,528
|
|
|
Liabilities and equity
|
|
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
|
|
||||
Accounts payable
|
|
$
|
3,166
|
|
|
|
$
|
1,281
|
|
|
Contract liabilities
|
|
7,205
|
|
|
|
7,054
|
|
|
||
Salaries, benefits and payroll taxes
|
|
2,022
|
|
|
|
2,466
|
|
|
||
Current maturities of long-term debt
|
|
1,250
|
|
|
|
1,250
|
|
|
||
Other current liabilities
|
|
2,009
|
|
|
|
1,921
|
|
|
||
Total current liabilities
|
|
15,652
|
|
|
|
13,972
|
|
|
||
Long-term debt, net
|
|
11,439
|
|
|
|
11,404
|
|
|
||
Accrued pension liabilities
|
|
13,078
|
|
|
|
13,234
|
|
|
||
Other noncurrent liabilities
|
|
5,592
|
|
|
|
5,747
|
|
|
||
Total liabilities
|
|
45,761
|
|
|
|
44,357
|
|
|
||
Stockholders’ equity
|
|
|
|
|
|
|
||||
Common stock, $1 par value per share
|
|
279
|
|
|
|
280
|
|
|
||
Additional paid-in capital
|
|
—
|
|
|
|
—
|
|
|
||
Retained earnings
|
|
18,708
|
|
|
|
18,401
|
|
|
||
Accumulated other comprehensive loss
|
|
(15,541
|
)
|
|
|
(15,554
|
)
|
|
||
Total stockholders’ equity
|
|
3,446
|
|
|
|
3,127
|
|
|
||
Noncontrolling interests in subsidiary
|
|
41
|
|
|
|
44
|
|
|
||
Total equity
|
|
3,487
|
|
|
|
3,171
|
|
|
||
Total liabilities and equity
|
|
$
|
49,248
|
|
|
|
$
|
47,528
|
|
|
|
|
Quarters Ended
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
||||||
Operating activities
|
|
|
|
|
|
|
||||
Net earnings
|
|
$
|
1,717
|
|
|
|
$
|
1,704
|
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities
|
|
|
|
|
|
|
||||
Depreciation and amortization
|
|
301
|
|
|
|
277
|
|
|
||
Stock-based compensation
|
|
42
|
|
|
|
37
|
|
|
||
Gain on property sale
|
|
—
|
|
|
|
(51
|
)
|
|
||
Changes in assets and liabilities
|
|
|
|
|
|
|
||||
Receivables, net
|
|
(555
|
)
|
|
|
(389
|
)
|
|
||
Contract assets
|
|
(1,095
|
)
|
|
|
(1,025
|
)
|
|
||
Inventories
|
|
80
|
|
|
|
(288
|
)
|
|
||
Accounts payable
|
|
1,894
|
|
|
|
744
|
|
|
||
Contract liabilities
|
|
151
|
|
|
|
305
|
|
|
||
Postretirement benefit plans
|
|
(39
|
)
|
|
|
278
|
|
|
||
Income taxes
|
|
167
|
|
|
|
243
|
|
|
||
Other, net
|
|
(349
|
)
|
|
|
(172
|
)
|
|
||
Net cash provided by operating activities
|
|
2,314
|
|
|
|
1,663
|
|
|
||
Investing activities
|
|
|
|
|
|
|
||||
Capital expenditures
|
|
(293
|
)
|
|
|
(284
|
)
|
|
||
Other, net
|
|
(2
|
)
|
|
|
27
|
|
|
||
Net cash used for investing activities
|
|
(295
|
)
|
|
|
(257
|
)
|
|
||
Financing activities
|
|
|
|
|
|
|
||||
Dividends paid
|
|
(693
|
)
|
|
|
(638
|
)
|
|
||
Repurchases of common stock
|
|
(756
|
)
|
|
|
(281
|
)
|
|
||
Repayments of commercial paper, net
|
|
—
|
|
|
|
(200
|
)
|
|
||
Other, net
|
|
(96
|
)
|
|
|
(68
|
)
|
|
||
Net cash used for financing activities
|
|
(1,545
|
)
|
|
|
(1,187
|
)
|
|
||
Net change in cash and cash equivalents
|
|
474
|
|
|
|
219
|
|
|
||
Cash and cash equivalents at beginning of period
|
|
1,514
|
|
|
|
772
|
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
1,988
|
|
|
|
$
|
991
|
|
|
|
Common
Stock |
Additional
Paid-in Capital |
Retained
Earnings |
Accumulated
Other Comprehensive Loss |
Total
Stockholders’ Equity |
Noncontrolling
Interests in Subsidiary |
Total
Equity |
||||||||||||||||||
Balance at December 31, 2019
|
$
|
280
|
|
$
|
—
|
|
|
$
|
18,401
|
|
$
|
(15,554
|
)
|
|
$
|
3,127
|
|
|
$
|
44
|
|
|
$
|
3,171
|
|
Net earnings
|
—
|
|
—
|
|
|
1,717
|
|
—
|
|
|
1,717
|
|
|
—
|
|
|
1,717
|
|
|||||||
Other comprehensive income, net of tax
|
—
|
|
—
|
|
|
—
|
|
13
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|||||||
Repurchases of common stock
|
(2
|
)
|
(29
|
)
|
|
(733
|
)
|
—
|
|
|
(764
|
)
|
|
—
|
|
|
(764
|
)
|
|||||||
Dividends declared
|
—
|
|
—
|
|
|
(677
|
)
|
—
|
|
|
(677
|
)
|
|
—
|
|
|
(677
|
)
|
|||||||
Stock-based awards, ESOP activity and other
|
1
|
|
29
|
|
|
—
|
|
—
|
|
|
30
|
|
|
—
|
|
|
30
|
|
|||||||
Net decrease in noncontrolling interests in subsidiary
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||||||
Balance at March 29, 2020
|
$
|
279
|
|
$
|
—
|
|
|
$
|
18,708
|
|
$
|
(15,541
|
)
|
|
$
|
3,446
|
|
|
$
|
41
|
|
|
$
|
3,487
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2018
|
$
|
281
|
|
$
|
—
|
|
|
$
|
15,434
|
|
$
|
(14,321
|
)
|
|
$
|
1,394
|
|
|
$
|
55
|
|
|
$
|
1,449
|
|
Net earnings
|
—
|
|
—
|
|
|
1,704
|
|
—
|
|
|
1,704
|
|
|
—
|
|
|
1,704
|
|
|||||||
Other comprehensive income, net of tax
|
—
|
|
—
|
|
|
—
|
|
227
|
|
|
227
|
|
|
—
|
|
|
227
|
|
|||||||
Repurchases of common stock
|
(1
|
)
|
(46
|
)
|
|
(237
|
)
|
—
|
|
|
(284
|
)
|
|
—
|
|
|
(284
|
)
|
|||||||
Dividends declared
|
—
|
|
—
|
|
|
(623
|
)
|
—
|
|
|
(623
|
)
|
|
—
|
|
|
(623
|
)
|
|||||||
Stock-based awards, ESOP activity and other
|
1
|
|
46
|
|
|
—
|
|
—
|
|
|
47
|
|
|
—
|
|
|
47
|
|
|||||||
Net increase in noncontrolling interests in subsidiary
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||||
Balance at March 31, 2019
|
$
|
281
|
|
$
|
—
|
|
|
$
|
16,278
|
|
$
|
(14,094
|
)
|
|
$
|
2,465
|
|
|
$
|
57
|
|
|
$
|
2,522
|
|
|
|
Quarters Ended
|
|
||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||
Weighted average common shares outstanding for basic computations
|
|
281.3
|
|
|
|
282.5
|
|
|
|
Weighted average dilutive effect of equity awards
|
|
1.3
|
|
|
|
1.8
|
|
|
|
Weighted average common shares outstanding for diluted computations
|
|
282.6
|
|
|
|
284.3
|
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
|
|
|
|
|
|
||||
Aeronautics
|
|
$
|
6,369
|
|
|
|
$
|
5,584
|
|
|
|
Missiles and Fire Control
|
|
2,619
|
|
|
|
2,350
|
|
|
|
||
Rotary and Mission Systems
|
|
3,746
|
|
|
|
3,762
|
|
|
|
||
Space
|
|
2,917
|
|
|
|
2,640
|
|
|
|
||
Total net sales
|
|
$
|
15,651
|
|
|
|
$
|
14,336
|
|
|
|
Operating profit
|
|
|
|
|
|
|
|
||||
Aeronautics
|
|
$
|
672
|
|
|
|
$
|
585
|
|
|
|
Missiles and Fire Control
|
|
396
|
|
|
|
417
|
|
|
|
||
Rotary and Mission Systems
|
|
376
|
|
|
|
379
|
|
|
|
||
Space
|
|
281
|
|
|
|
334
|
|
|
|
||
Total business segment operating profit
|
|
1,725
|
|
|
|
1,715
|
|
|
|
||
Unallocated items
|
|
|
|
|
|
|
|
||||
FAS/CAS operating adjustment (a)
|
|
469
|
|
|
|
512
|
|
|
|
||
Stock-based compensation
|
|
(42
|
)
|
|
|
(37
|
)
|
|
|
||
Other, net
|
|
(30
|
)
|
|
|
93
|
|
|
|
||
Total unallocated items
|
|
397
|
|
|
|
568
|
|
|
|
||
Total consolidated operating profit
|
|
$
|
2,122
|
|
|
|
$
|
2,283
|
|
|
|
Intersegment sales
|
|
|
|
|
|
|
|
||||
Aeronautics
|
|
$
|
59
|
|
|
|
$
|
42
|
|
|
|
Missiles and Fire Control
|
|
136
|
|
|
|
121
|
|
|
|
||
Rotary and Mission Systems
|
|
499
|
|
|
|
499
|
|
|
|
||
Space
|
|
108
|
|
|
|
68
|
|
|
|
||
Total intersegment sales
|
|
$
|
802
|
|
|
|
$
|
730
|
|
|
|
(a)
|
The FAS/CAS operating adjustment represents the difference between the service cost component of financial accounting standards (FAS) pension income (expense) and total pension costs recoverable on U.S. Government contracts as determined in accordance with CAS.
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Total FAS income (expense) and CAS costs
|
|
|
|
|
|
|
|
||||
FAS pension income (expense)
|
|
$
|
30
|
|
|
|
$
|
(273
|
)
|
|
|
Less: CAS pension cost
|
|
494
|
|
|
|
641
|
|
|
|
||
Net FAS/CAS pension adjustment
|
|
$
|
524
|
|
|
|
$
|
368
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service and non-service cost reconciliation
|
|
|
|
|
|
|
|
||||
FAS pension service cost
|
|
$
|
(25
|
)
|
|
|
$
|
(129
|
)
|
|
|
Less: CAS pension cost
|
|
494
|
|
|
|
641
|
|
|
|
||
FAS/CAS operating adjustment
|
|
469
|
|
|
|
512
|
|
|
|
||
Non-operating FAS pension income (expense)
|
|
55
|
|
|
|
(144
|
)
|
|
|
||
Net FAS/CAS pension adjustment
|
|
$
|
524
|
|
|
|
$
|
368
|
|
|
|
|
|
Quarter Ended March 29, 2020
|
||||||||||||||||||
|
|
Aeronautics
|
|
MFC
|
|
RMS
|
|
Space
|
|
Total
|
||||||||||
Net sales
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Products
|
|
$
|
5,455
|
|
|
$
|
2,275
|
|
|
$
|
2,986
|
|
|
$
|
2,450
|
|
|
$
|
13,166
|
|
Services
|
|
914
|
|
|
344
|
|
|
760
|
|
|
467
|
|
|
2,485
|
|
|||||
Total net sales
|
|
$
|
6,369
|
|
|
$
|
2,619
|
|
|
$
|
3,746
|
|
|
$
|
2,917
|
|
|
$
|
15,651
|
|
Net sales by contract type
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-price
|
|
$
|
4,584
|
|
|
$
|
1,718
|
|
|
$
|
2,482
|
|
|
$
|
519
|
|
|
$
|
9,303
|
|
Cost-reimbursable
|
|
1,785
|
|
|
901
|
|
|
1,264
|
|
|
2,398
|
|
|
6,348
|
|
|||||
Total net sales
|
|
$
|
6,369
|
|
|
$
|
2,619
|
|
|
$
|
3,746
|
|
|
$
|
2,917
|
|
|
$
|
15,651
|
|
Net sales by customer
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Government
|
|
$
|
4,033
|
|
|
$
|
1,955
|
|
|
$
|
2,788
|
|
|
$
|
2,483
|
|
|
$
|
11,259
|
|
International (a)
|
|
2,321
|
|
|
660
|
|
|
855
|
|
|
420
|
|
|
4,256
|
|
|||||
U.S. commercial and other
|
|
15
|
|
|
4
|
|
|
103
|
|
|
14
|
|
|
136
|
|
|||||
Total net sales
|
|
$
|
6,369
|
|
|
$
|
2,619
|
|
|
$
|
3,746
|
|
|
$
|
2,917
|
|
|
$
|
15,651
|
|
Net sales by geographic region
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
4,048
|
|
|
$
|
1,959
|
|
|
$
|
2,891
|
|
|
$
|
2,497
|
|
|
$
|
11,395
|
|
Asia Pacific
|
|
995
|
|
|
75
|
|
|
318
|
|
|
28
|
|
|
1,416
|
|
|||||
Europe
|
|
948
|
|
|
168
|
|
|
167
|
|
|
398
|
|
|
1,681
|
|
|||||
Middle East
|
|
328
|
|
|
407
|
|
|
207
|
|
|
(6
|
)
|
|
936
|
|
|||||
Other
|
|
50
|
|
|
10
|
|
|
163
|
|
|
—
|
|
|
223
|
|
|||||
Total net sales
|
|
$
|
6,369
|
|
|
$
|
2,619
|
|
|
$
|
3,746
|
|
|
$
|
2,917
|
|
|
$
|
15,651
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended March 31, 2019
|
||||||||||||||||||
|
|
Aeronautics
|
|
MFC
|
|
RMS
|
|
Space
|
|
Total
|
||||||||||
Net sales
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Products
|
|
$
|
4,796
|
|
|
$
|
1,916
|
|
|
$
|
3,059
|
|
|
$
|
2,199
|
|
|
$
|
11,970
|
|
Services
|
|
788
|
|
|
434
|
|
|
703
|
|
|
441
|
|
|
2,366
|
|
|||||
Total net sales
|
|
$
|
5,584
|
|
|
$
|
2,350
|
|
|
$
|
3,762
|
|
|
$
|
2,640
|
|
|
$
|
14,336
|
|
Net sales by contract type
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-price
|
|
$
|
4,170
|
|
|
$
|
1,535
|
|
|
$
|
2,619
|
|
|
$
|
523
|
|
|
$
|
8,847
|
|
Cost-reimbursable
|
|
1,414
|
|
|
815
|
|
|
1,143
|
|
|
2,117
|
|
|
5,489
|
|
|||||
Total net sales
|
|
$
|
5,584
|
|
|
$
|
2,350
|
|
|
$
|
3,762
|
|
|
$
|
2,640
|
|
|
$
|
14,336
|
|
Net sales by customer
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Government
|
|
$
|
3,435
|
|
|
$
|
1,633
|
|
|
$
|
2,675
|
|
|
$
|
2,236
|
|
|
$
|
9,979
|
|
International (a)
|
|
2,095
|
|
|
670
|
|
|
995
|
|
|
395
|
|
|
4,155
|
|
|||||
U.S. commercial and other
|
|
54
|
|
|
47
|
|
|
92
|
|
|
9
|
|
|
202
|
|
|||||
Total net sales
|
|
$
|
5,584
|
|
|
$
|
2,350
|
|
|
$
|
3,762
|
|
|
$
|
2,640
|
|
|
$
|
14,336
|
|
Net sales by geographic region
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
3,489
|
|
|
$
|
1,680
|
|
|
$
|
2,767
|
|
|
$
|
2,245
|
|
|
$
|
10,181
|
|
Asia Pacific
|
|
906
|
|
|
122
|
|
|
330
|
|
|
8
|
|
|
1,366
|
|
|||||
Europe
|
|
798
|
|
|
122
|
|
|
198
|
|
|
381
|
|
|
1,499
|
|
|||||
Middle East
|
|
337
|
|
|
413
|
|
|
285
|
|
|
6
|
|
|
1,041
|
|
|||||
Other
|
|
54
|
|
|
13
|
|
|
182
|
|
|
—
|
|
|
249
|
|
|||||
Total net sales
|
|
$
|
5,584
|
|
|
$
|
2,350
|
|
|
$
|
3,762
|
|
|
$
|
2,640
|
|
|
$
|
14,336
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
International sales include foreign military sales (FMS) contracted through the U.S. Government and direct commercial sales to international governments and other international customers.
|
|
|
March 29,
2020 |
|
December 31,
2019 |
||||||
Assets
|
|
|
|
|
|
|
||||
Aeronautics
|
|
$
|
10,003
|
|
|
|
$
|
9,109
|
|
|
Missiles and Fire Control
|
|
5,210
|
|
|
|
5,030
|
|
|
||
Rotary and Mission Systems
|
|
18,901
|
|
|
|
18,751
|
|
|
||
Space
|
|
6,164
|
|
|
|
5,844
|
|
|
||
Total business segment assets
|
|
40,278
|
|
|
|
38,734
|
|
|
||
Corporate assets (a)
|
|
8,970
|
|
|
|
8,794
|
|
|
||
Total assets
|
|
$
|
49,248
|
|
|
|
$
|
47,528
|
|
|
(a)
|
Corporate assets primarily include cash and cash equivalents, deferred income taxes, assets for the portion of environmental costs that are probable of future recovery and investments held in a separate trust.
|
|
|
March 29,
2020 |
|
December 31,
2019 |
||||||
Contract assets
|
|
$
|
10,189
|
|
|
|
$
|
9,094
|
|
|
Contract liabilities
|
|
7,205
|
|
|
|
7,054
|
|
|
|
|
March 29,
2020 |
|
December 31,
2019 |
||||||
Materials, spares and supplies
|
|
$
|
521
|
|
|
|
$
|
532
|
|
|
Work-in-process
|
|
2,717
|
|
|
|
2,783
|
|
|
||
Finished goods
|
|
301
|
|
|
|
304
|
|
|
||
Total inventories
|
|
$
|
3,539
|
|
|
|
$
|
3,619
|
|
|
|
|
Quarters Ended
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
||||||
Qualified defined benefit pension plans
|
|
|
|
|
|
|
||||
Service cost
|
|
$
|
25
|
|
|
|
$
|
129
|
|
|
Interest cost
|
|
385
|
|
|
|
452
|
|
|
||
Expected return on plan assets
|
|
(566
|
)
|
|
|
(575
|
)
|
|
||
Recognized net actuarial losses
|
|
212
|
|
|
|
351
|
|
|
||
Amortization of prior service credits
|
|
(86
|
)
|
|
|
(84
|
)
|
|
||
Total net periodic benefit (income) cost
|
|
$
|
(30
|
)
|
|
|
$
|
273
|
|
|
Retiree medical and life insurance plans
|
|
|
|
|
|
|
||||
Service cost
|
|
$
|
3
|
|
|
|
$
|
4
|
|
|
Interest cost
|
|
18
|
|
|
|
24
|
|
|
||
Expected return on plan assets
|
|
(32
|
)
|
|
|
(28
|
)
|
|
||
Recognized net actuarial losses
|
|
(1
|
)
|
|
|
1
|
|
|
||
Amortization of prior service costs
|
|
10
|
|
|
|
10
|
|
|
||
Total net periodic benefit (income) cost
|
|
$
|
(2
|
)
|
|
|
$
|
11
|
|
|
|
|
March 29, 2020
|
|
December 31, 2019
|
||||||||||||||||||||
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Total
|
|
Level 1
|
|
Level 2
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||||||||||
Mutual funds
|
|
$
|
979
|
|
|
$
|
979
|
|
|
$
|
—
|
|
|
$
|
1,363
|
|
|
$
|
1,363
|
|
|
$
|
—
|
|
U.S. Government securities
|
|
77
|
|
|
—
|
|
|
77
|
|
|
99
|
|
|
—
|
|
|
99
|
|
||||||
Other securities
|
|
299
|
|
|
132
|
|
|
167
|
|
|
319
|
|
|
171
|
|
|
148
|
|
||||||
Derivatives
|
|
66
|
|
|
—
|
|
|
66
|
|
|
18
|
|
|
—
|
|
|
18
|
|
||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivatives
|
|
37
|
|
|
—
|
|
|
37
|
|
|
23
|
|
|
—
|
|
|
23
|
|
||||||
Assets measured at NAV (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other commingled funds
|
|
19
|
|
|
|
|
|
|
19
|
|
|
|
|
|
(a)
|
Net Asset Value (NAV) is the total value of the fund divided by the number of the fund’s shares outstanding.
|
|
|
Postretirement
Benefit Plans
|
|
Other, net
|
|
AOCL
|
||||||
Balance at December 31, 2019
|
|
$
|
(15,528
|
)
|
|
$
|
(26
|
)
|
|
$
|
(15,554
|
)
|
Other comprehensive income before reclassifications
|
|
—
|
|
|
5
|
|
|
5
|
|
|||
Amounts reclassified from AOCL
|
|
|
|
|
|
|
||||||
Recognition of net actuarial losses (a)
|
|
172
|
|
|
—
|
|
|
172
|
|
|||
Amortization of net prior service credits (a)
|
|
(62
|
)
|
|
—
|
|
|
(62
|
)
|
|||
Other
|
|
—
|
|
|
(102
|
)
|
|
(102
|
)
|
|||
Total reclassified from AOCL
|
|
110
|
|
|
(102
|
)
|
|
8
|
|
|||
Total other comprehensive income
|
|
110
|
|
|
(97
|
)
|
|
13
|
|
|||
Balance at March 29, 2020
|
|
$
|
(15,418
|
)
|
|
$
|
(123
|
)
|
|
$
|
(15,541
|
)
|
|
|
|
|
|
|
|
||||||
Balance at December 31, 2018
|
|
$
|
(14,254
|
)
|
|
$
|
(67
|
)
|
|
$
|
(14,321
|
)
|
Other comprehensive income before reclassifications
|
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|||
Amounts reclassified from AOCL
|
|
|
|
|
|
|
||||||
Recognition of net actuarial losses (a)
|
|
287
|
|
|
—
|
|
|
287
|
|
|||
Amortization of net prior service credits (a)
|
|
(60
|
)
|
|
—
|
|
|
(60
|
)
|
|||
Other
|
|
—
|
|
|
5
|
|
|
5
|
|
|||
Total reclassified from AOCL
|
|
227
|
|
|
5
|
|
|
232
|
|
|||
Total other comprehensive income
|
|
227
|
|
|
—
|
|
|
227
|
|
|||
Balance at March 31, 2019
|
|
$
|
(14,027
|
)
|
|
$
|
(67
|
)
|
|
$
|
(14,094
|
)
|
(a)
|
Reclassifications from AOCL related to our postretirement benefit plans were recorded as a component of net periodic benefit cost for each period presented (see “Note 6 – Postretirement Benefit Plans”).
|
|
|
Quarters Ended
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
||||||
Net sales
|
|
$
|
15,651
|
|
|
|
$
|
14,336
|
|
|
Cost of sales
|
|
(13,560
|
)
|
|
|
(12,148
|
)
|
|
||
Gross profit
|
|
2,091
|
|
|
|
2,188
|
|
|
||
Other income, net
|
|
31
|
|
|
|
95
|
|
|
||
Operating profit
|
|
2,122
|
|
|
|
2,283
|
|
|
||
Interest expense
|
|
(148
|
)
|
|
|
(171
|
)
|
|
||
Other non-operating income (expense), net
|
|
56
|
|
|
|
(167
|
)
|
|
||
Earnings before income taxes
|
|
2,030
|
|
|
|
1,945
|
|
|
||
Income tax expense
|
|
(313
|
)
|
|
|
(241
|
)
|
|
||
Net earnings
|
|
$
|
1,717
|
|
|
|
$
|
1,704
|
|
|
Diluted earnings per common share
|
|
$
|
6.08
|
|
|
|
$
|
5.99
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Products
|
|
$
|
13,166
|
|
|
|
$
|
11,970
|
|
|
|
% of total net sales
|
|
84.1
|
%
|
|
|
83.5
|
%
|
|
|
||
Services
|
|
2,485
|
|
|
|
2,366
|
|
|
|
||
% of total net sales
|
|
15.9
|
%
|
|
|
16.5
|
%
|
|
|
||
Total net sales
|
|
$
|
15,651
|
|
|
|
$
|
14,336
|
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Cost of sales – products
|
|
$
|
(11,742
|
)
|
|
|
$
|
(10,625
|
)
|
|
|
% of product sales
|
|
89.2
|
%
|
|
|
88.8
|
%
|
|
|
||
Cost of sales – services
|
|
(2,213
|
)
|
|
|
(2,047
|
)
|
|
|
||
% of service sales
|
|
89.1
|
%
|
|
|
86.5
|
%
|
|
|
||
Other unallocated, net
|
|
395
|
|
|
|
524
|
|
|
|
||
Total cost of sales
|
|
$
|
(13,560
|
)
|
|
|
$
|
(12,148
|
)
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
|
|
|
|
|
|
||||
Aeronautics
|
|
$
|
6,369
|
|
|
|
$
|
5,584
|
|
|
|
Missiles and Fire Control
|
|
2,619
|
|
|
|
2,350
|
|
|
|
||
Rotary and Mission Systems
|
|
3,746
|
|
|
|
3,762
|
|
|
|
||
Space
|
|
2,917
|
|
|
|
2,640
|
|
|
|
||
Total net sales
|
|
$
|
15,651
|
|
|
|
$
|
14,336
|
|
|
|
Operating profit
|
|
|
|
|
|
|
|
||||
Aeronautics
|
|
$
|
672
|
|
|
|
$
|
585
|
|
|
|
Missiles and Fire Control
|
|
396
|
|
|
|
417
|
|
|
|
||
Rotary and Mission Systems
|
|
376
|
|
|
|
379
|
|
|
|
||
Space
|
|
281
|
|
|
|
334
|
|
|
|
||
Total business segment operating profit
|
|
1,725
|
|
|
|
1,715
|
|
|
|
||
Unallocated items
|
|
|
|
|
|
|
|
||||
FAS/CAS operating adjustment (a)
|
|
469
|
|
|
|
512
|
|
|
|
||
Stock-based compensation
|
|
(42
|
)
|
|
|
(37
|
)
|
|
|
||
Other, net
|
|
(30
|
)
|
|
|
93
|
|
|
|
||
Total unallocated items
|
|
397
|
|
|
|
568
|
|
|
|
||
Total consolidated operating profit
|
|
$
|
2,122
|
|
|
|
$
|
2,283
|
|
|
|
(a)
|
The FAS/CAS operating adjustment represents the difference between the service cost component of financial accounting standards (FAS) pension income (expense) and total pension costs recoverable on U.S. Government contracts as determined in accordance with CAS.
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Total FAS income (expense) and CAS costs
|
|
|
|
|
|
|
|
||||
FAS pension income (expense)
|
|
$
|
30
|
|
|
|
$
|
(273
|
)
|
|
|
Less: CAS pension cost
|
|
494
|
|
|
|
641
|
|
|
|
||
Net FAS/CAS pension adjustment
|
|
$
|
524
|
|
|
|
$
|
368
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service and non-service cost reconciliation
|
|
|
|
|
|
|
|
||||
FAS pension service cost
|
|
$
|
(25
|
)
|
|
|
$
|
(129
|
)
|
|
|
Less: CAS pension cost
|
|
494
|
|
|
|
641
|
|
|
|
||
FAS/CAS operating adjustment
|
|
469
|
|
|
|
512
|
|
|
|
||
Non-operating FAS pension income (expense)
|
|
55
|
|
|
|
(144
|
)
|
|
|
||
Net FAS/CAS pension adjustment
|
|
$
|
524
|
|
|
|
$
|
368
|
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
$
|
6,369
|
|
|
|
$
|
5,584
|
|
|
|
Operating profit
|
|
672
|
|
|
|
585
|
|
|
|
||
Operating margin
|
|
10.6
|
%
|
|
|
10.5
|
%
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
$
|
2,619
|
|
|
|
$
|
2,350
|
|
|
|
Operating profit
|
|
396
|
|
|
|
417
|
|
|
|
||
Operating margin
|
|
15.1
|
%
|
|
|
17.7
|
%
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
$
|
3,746
|
|
|
|
$
|
3,762
|
|
|
|
Operating profit
|
|
376
|
|
|
|
379
|
|
|
|
||
Operating margin
|
|
10.0
|
%
|
|
|
10.1
|
%
|
|
|
|
|
Quarters Ended
|
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
|
||||||
Net sales
|
|
$
|
2,917
|
|
|
|
$
|
2,640
|
|
|
|
Operating profit
|
|
281
|
|
|
|
334
|
|
|
|
||
Operating margin
|
|
9.6
|
%
|
|
|
12.7
|
%
|
|
|
|
|
Quarters Ended
|
||||||||
|
|
March 29,
2020 |
|
March 31,
2019 |
||||||
Cash and cash equivalents at beginning of year
|
|
$
|
1,514
|
|
|
|
$
|
772
|
|
|
Operating activities
|
|
|
|
|
|
|
||||
Net earnings
|
|
1,717
|
|
|
|
1,704
|
|
|
||
Non-cash adjustments
|
|
343
|
|
|
|
263
|
|
|
||
Changes in working capital
|
|
475
|
|
|
|
(653
|
)
|
|
||
Other, net
|
|
(221
|
)
|
|
|
349
|
|
|
||
Net cash provided by operating activities
|
|
2,314
|
|
|
|
1,663
|
|
|
||
Net cash used for investing activities
|
|
(295
|
)
|
|
|
(257
|
)
|
|
||
Net cash used for financing activities
|
|
(1,545
|
)
|
|
|
(1,187
|
)
|
|
||
Net change in cash and cash equivalents
|
|
474
|
|
|
|
219
|
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
1,988
|
|
|
|
$
|
991
|
|
|
•
|
the impact of the COVID-19 outbreak or future epidemics on our business, including the potential for facility closures or work stoppages, supply chain disruptions, program delays, our ability to recover our costs under contracts,
|
•
|
our reliance on contracts with the U.S. Government, which are conditioned upon the availability of funding and can be terminated by the U.S. Government for convenience, and our ability to negotiate favorable contract terms;
|
•
|
budget uncertainty, affordability initiatives or the risk of future budget cuts;
|
•
|
risks related to the development, production, sustainment, performance, schedule, cost and requirements of complex and technologically advanced programs including our largest, the F-35 program;
|
•
|
planned production rates for significant programs; compliance with stringent performance and reliability standards; materials availability;
|
•
|
the performance and financial viability of key suppliers, teammates, joint ventures, joint venture partners, subcontractors and customers;
|
•
|
economic, industry, business and political conditions including their effects on governmental policy and government actions that disrupt our supply chain or prevent the sale or delivery of our products (such as delays in obtaining Congressional approvals for exports requiring Congressional notification and export license delays due to COVID-19);
|
•
|
trade policies or sanctions (including Turkey’s removal from the F-35 program, the impact of U.S. Government sanctions on Turkey and potential sanctions on the Kingdom of Saudi Arabia);
|
•
|
our success expanding into and doing business in adjacent markets and internationally and the differing risks posed by international sales;
|
•
|
changes in foreign national priorities and foreign government budgets;
|
•
|
the competitive environment for our products and services, including increased pricing pressures, aggressive pricing in the absence of cost realism evaluation criteria, competition from outside the aerospace and defense industry, and bid protests;
|
•
|
the timing and customer acceptance of product deliveries;
|
•
|
our ability to continue to innovate and develop new products and to attract and retain key personnel and transfer knowledge to new personnel; the impact of work stoppages or other labor disruptions;
|
•
|
the impact of cyber or other security threats or other disruptions to our businesses;
|
•
|
our ability to implement and continue, and the timing and impact of, capitalization changes such as share repurchases and dividend payments;
|
•
|
our ability to recover costs under U.S. Government contracts and changes in contract mix;
|
•
|
the accuracy of our estimates and projections;
|
•
|
timing and estimates regarding pension funding and movements in interest rates and other changes that may affect pension plan assumptions, stockholders’ equity, the level of the FAS/CAS adjustment and actual returns on pension plan assets;
|
•
|
the successful operation of joint ventures that we do not control and our ability to recover our investments;
|
•
|
realizing the anticipated benefits of acquisitions or divestitures, joint ventures, teaming arrangements or internal reorganizations;
|
•
|
our efforts to increase the efficiency of our operations and improve the affordability of our products and services;
|
•
|
risk of an impairment of our assets, including a potential non-cash impairment charge as early as the second quarter for our equity investment in Advanced Military Maintenance, Repair and Overhaul Center LLC (AMMROC) and the potential impairment of goodwill, intangible assets and inventory recorded as a result of the acquisition of the Sikorsky business;
|
•
|
the availability and adequacy of our insurance and indemnities;
|
•
|
the effect of changes in (or in the interpretation of) procurement and other regulations and policies affecting our industry, including export of our products, cost allowability or recovery and potential changes to the U.S. Department of Defense’s (DoD) acquisition regulations relating to progress payments and performance-based payments and a preference for fixed-price contracts; including the potential for DoD to temporarily modify these in response to COVID-19;
|
•
|
our ability to benefit fully from or adequately protect our intellectual property rights;
|
•
|
the effect of changes in accounting, taxation, or export laws, regulations, and policies and their interpretation or application; and
|
•
|
the outcome of legal proceedings, bid protests, environmental remediation efforts, audits, government investigations or government allegations that we have failed to comply with law, other contingencies and U.S. Government identification of deficiencies in our business systems.
|
Period (a)
|
|
Total Number
of Shares
Purchased
|
Average
Price Paid
Per Share
|
Total Number of
Shares
Purchased as
Part of Publicly
Announced Plans
or Programs (b) |
Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs (b)
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|||||||
January 1, 2020 – January 26, 2020
|
|
91,200
|
|
|
|
$
|
423.82
|
|
|
|
91,200
|
|
|
$
|
2,772
|
|
|
January 27, 2020 – February 23, 2020
|
|
463,418
|
|
|
|
$
|
433.08
|
|
|
|
188,270
|
|
|
$
|
2,690
|
|
|
February 24, 2020 – March 29, 2020(c)(d)
|
|
1,453,821
|
|
|
|
$
|
350.37
|
|
|
|
1,452,284
|
|
|
$
|
2,047
|
|
|
Total(c)
|
|
2,008,439
|
|
|
$
|
396.95
|
|
|
|
1,731,754
|
|
|
|
|
(a)
|
We close our books and records on the last Sunday of each month to align our financial closing with our business processes, except for the month of December, as our fiscal year ends on December 31. As a result, our fiscal months often differ from the calendar months. For example, January 26, 2020 was the last day of our January 2020 fiscal month.
|
(b)
|
In October 2010, our Board of Directors approved a share repurchase program pursuant to which we are authorized to repurchase our common stock in privately negotiated transactions or in the open market at prices per share not exceeding the then-current market prices. From time to time, our Board of Directors authorizes increases to our share repurchase program. The total remaining authorization for future common share repurchases under our share repurchase program was $2.0 billion as of March 29, 2020. Under the program, management has discretion to determine the dollar amount of shares to be repurchased and the timing of any repurchases in compliance with applicable law and regulation. This includes purchases pursuant to Rule 10b5-1 plans, including accelerated share repurchases. The program does not have an expiration date.
|
(c)
|
During the quarter ended March 29, 2020, we entered into an accelerated share repurchase (ASR) agreement to repurchase $500 million of our common stock through April 2020. Under the terms of the ASR agreement, we made a payment of $500 million and received an initial delivery of 1.0 million shares of our common stock. The total number of shares of common stock to be received is based on an average volume-weighted average price (VWAP) of our common stock during the term of the ASR agreement, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR agreement. Based on the average VWAP as of April 20, 2020, we expect to receive approximately 0.5 million additional shares upon final settlement. See “Note 9 – Stockholders’ Equity” included in our Notes to Consolidated Financial Statements. Average Price Paid Per Share above does not include ASR shares.
|
(d)
|
During the quarter ended March 29, 2020, the total number of shares purchased included 276,685 shares that were transferred to us by employees in satisfaction of tax withholding obligations associated with the vesting of restricted stock units and performance stock units. These purchases were made pursuant to a separate authorization by our Board of Directors and are not included within the program.
|
Exhibit No.
|
|
Description
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
10.6
|
|
|
|
|
|
15
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
|
|
|
101.SCH
|
|
Inline XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB
|
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
104
|
|
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document contained in Exhibit 101
|
|
|
Lockheed Martin Corporation
|
|
|
(Registrant)
|
|
|
|
Date: April 22, 2020
|
|
By: /s/ Brian P. Colan
|
|
|
Brian P. Colan
|
|
|
Vice President and Controller
|
|
|
(Duly Authorized Officer and Chief Accounting Officer)
|
1.
|
CONSIDERATION FOR AWARD
|
2.
|
RIGHTS OF OWNERSHIP, RESTRICTIONS ON TRANSFER
|
3.
|
RESTRICTED PERIOD, FORFEITURE
|
4.
|
DEATH, DISABILITY, LAYOFF, RETIREMENT
|
(a)
|
Death and Disability
|
(i)
|
you die while still employed by the Corporation; or
|
(ii)
|
you terminate employment as a result of your total disability. Your employment will be treated as terminating because of a total disability on the date you commence receiving a benefit under the Corporation’s long-term disability plan in which you participate (or, if you are not enrolled in the Corporation’s long-term disability plan, on the date on which long-term disability benefits would have commenced under the plan under which you would have been covered, had you enrolled, using the standards set forth in that plan).
|
(b)
|
Retirement or Layoff
|
5.
|
RESIGNATION OR TERMINATION BEFORE FEBRUARY 27, 2023
|
6.
|
DIVESTITURE
|
7.
|
CHANGE IN CONTROL DURING THE RESTRICTED PERIOD
|
(a)
|
“Cause” shall mean either of the following:
|
(i)
|
Conviction for an act of fraud, embezzlement, theft or other act constituting a felony (other than traffic-related offenses or as a result of vicarious liability); or
|
(ii)
|
Willful misconduct that is materially injurious to the Corporation’s financial position, operating results or reputation; provided, however that no act or failure to act shall be considered “willful” unless done, or omitted to be done, by you (a) in bad faith; (b) for the purpose of receiving an actual improper personal benefit in the form of money, property or services; or (c) in circumstances where you had reasonable cause to believe that the act or failure to act was unlawful.
|
(i)
|
A material and substantial reduction in the nature or status of your authority or responsibilities;
|
(ii)
|
A material reduction in your annualized rate of base salary;
|
(iii)
|
A material reduction in the aggregate value of your level of participation in any short or long term incentive cash compensation plan, employee benefit or retirement plan or compensation practices, arrangements, or policies;
|
(iv)
|
A material reduction in the aggregate level of participation in equity-based incentive compensation plans; or
|
(v)
|
Your principal place of employment is relocated to a location that is greater than 50 miles from your principal place of employment on the date the Change in Control is consummated.
|
8.
|
AMENDMENT AND TERMINATION OF PLAN OR AWARDS
|
9.
|
ACCEPTANCE OF AWARD AGREEMENT; ELECTRONIC DELIVERY
|
10.
|
POST-EMPLOYMENT COVENANTS
|
11.
|
STOCK OWNERSHIP REQUIREMENTS
|
12.
|
DATA PRIVACY CONSENT FOR EMPLOYEES LOCATED OUTSIDE OF THE UNITED STATES
|
13.
|
EMPLOYEE ACKNOWLEDGEMENT
|
14.
|
ENGLISH LANGUAGE
|
15.
|
CURRENCY EXCHANGE RISK
|
16.
|
EXCHANGE CONTROL REQUIREMENTS
|
17.
|
MISCELLANEOUS
|
(i)
|
oversees, controls or affects the design, operation, research, manufacture, marketing, sale or distribution of “Competitive Products or Services” (as defined in Section 6) of or by the Restricted Company, or
|
(ii)
|
would involve a substantial risk that the “Confidential or Proprietary Information” (as defined in Section 1(c) below) of the Corporation (including but not limited to technical information or intellectual property, strategic plans, information relating to pricing offered to the Corporation by vendors or suppliers or to prices charged or pricing contemplated to be charged by the Corporation, information relating to employee performance, promotions or identification for promotion, or information relating to the Corporation’s cost base) could be used to the disadvantage of the Corporation.
|
(iii)
|
Post-Employment Activity As a Lawyer – I acknowledge that as counsel to the Corporation, I owe ethical and fiduciary obligations to the Corporation and that at least some of these obligations will continue even after my Termination Date with the Corporation. I agree that after my Termination Date I will comply fully with all applicable ethical and fiduciary obligations that I owe to the Corporation. To the extent permitted by applicable law, including but not limited to any applicable rules governing attorney conduct, I agree that I will not:
|
a.
|
Represent any client in the same or a substantially related matter in which I represented the Corporation where the client’s interests are materially adverse to the Corporation; or
|
b.
|
Disclose confidential information relating to my representation of the Corporation, including the disclosure of information that is to the disadvantage of the Corporation, except for information that is or becomes generally known.
|
(i)
|
existing and contemplated business, marketing and financial business information such as business plans and methods, marketing information, cost estimates, forecasts, financial data, cost or pricing data, bid and proposal information, customer identification, sources of supply, contemplated product lines, proposed business alliances, and information about customers and competitors,
|
(ii)
|
existing and contemplated technical information and documentation pertaining to technology, know how, equipment, machines, devices and systems, computer hardware and software, compositions, formulas, products, processes, methods, designs, specifications, mask works, testing or evaluation procedures, manufacturing processes, production techniques, research and development activities, inventions, discoveries, and improvements, and
|
(iii)
|
human resources and personnel information.
|
(i)
|
I will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that is made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney and solely for the purpose of reporting or investigating a suspected violation of law; or (2) in a complaint or other document that is filed under seal in a lawsuit or other proceeding.
|
(ii)
|
If I file a lawsuit for retaliation by the Corporation for reporting a suspected violation of law, I may disclose the Corporation’s trade secrets to my attorney and use the trade secret information in the court proceeding if I (1) file any document containing the trade secret under seal; and (2) do not disclose the trade secret, except pursuant to court order.
|
(i)
|
I breach any of the covenants or agreements in Section 1;
|
(ii)
|
The Corporation determines that either (a) my intentional misconduct or gross negligence, or (b) my failure to report another person’s intentional misconduct or gross negligence of which I had knowledge during the period I was employed by the Corporation, contributed to the Corporation having to restate all or a portion of its financial statements filed for any period with the Securities and Exchange Commission;
|
(iii)
|
The Corporation determines that I engaged in fraud, bribery, or any other illegal act, or that my intentional misconduct or gross negligence (including the failure to report another person’s intentional misconduct or gross negligence of which I had knowledge during the period I was employed by the Corporation) contributed to another person’s fraud, bribery, or other
|
(iv)
|
The Corporation determines that my intentional misconduct or gross negligence caused severe reputational or financial harm to the Corporation;
|
(v)
|
The Corporation determines that I misappropriated Confidential or Proprietary Information, as defined in Section 1(c), and I (A) intended to use the misappropriated Confidential or Proprietary Information to cause severe reputational or financial harm to the Corporation or (B) used the misappropriated Confidential or Proprietary Information in a manner that caused severe reputational or financial harm to the Corporation; or
|
(vi)
|
Under such other circumstances specified by final regulation issued by the Securities and Exchange Commission entitling the Corporation to recapture or clawback “Benefits and Proceeds” (as defined below).
|
(i)
|
with respect to the Chairman, President and Chief Executive Officer, the Management Development and Compensation Committee of the Corporation’s Board of Directors;
|
(ii)
|
with respect to any Elected Officer (other than the Chairman, President and Chief Executive Officer), the Corporation’s Chief Executive Officer; or
|
(iii)
|
with respect to all other employees, the Senior Vice President, Human Resources of the Corporation.
|
Title
|
Annual Base Pay Multiple
|
|
|
Chairman, President, and Chief Executive Officer
|
6 times
|
Chief Operating Officer
|
5 times
|
Chief Financial Officer
|
4 times
|
Executive Vice Presidents
|
3 times
|
Senior Vice Presidents
|
2 times
|
Other Elected Officers
|
2 times
|
Other Vice Presidents
|
1 times
|
•
|
Shares owned directly.
|
•
|
Shares owned by a spouse or a trust.
|
•
|
Shares represented by monies invested in 401(k) Company Common Stock Funds or comparable plans.
|
•
|
Share equivalents as represented by income deferred to the Company Stock Investment Option of the Deferred Management Incentive Compensation Plan (DMICP).
|
•
|
Unvested Restricted Stock Units.
|
Section 1.
|
Shares Awarded; Performance Period; Vesting Period; Payment of Award.
|
1.1
|
Shares Awarded.
|
ROIC Band
|
ROIC Performance Factor
|
Target +≥ 160 basis points
|
200% (Maximum)
|
Target + 120 basis points
|
175%
|
Target + 80 basis points
|
150%
|
Target + 40 basis points
|
125%
|
Target
|
100%
|
Target – 10 basis points
|
75%
|
Target – 20 basis points
|
50%
|
Target – 30 basis points
|
25% (Threshold)
|
Cash Flow Band
|
Cash Flow Performance Factor
|
Target + ≥ $2.0B
|
200% (Maximum)
|
Target + $1.5B
|
175%
|
Target + $1.0B
|
150%
|
Target + $0.5B
|
125%
|
Target
|
100%
|
Target – $0.2B
|
75%
|
Target - $0.5B
|
50%
|
Target - $0.7B
|
25% (Threshold)
|
(d)
|
Resignation or Termination before February 27, 2023.
|
(a)
|
“Cause” shall mean either of the following:
|
Section 11.
|
No Assurance of Employment; No Right to an Award; Value of Award.
|
Average TSR
|
§ 3.2(a)
|
Award
|
1st ¶
|
Award Date
|
Header
|
Cash Flow
|
§ 4.2(a)
|
Cash Flow Performance Factor
Cash Flow Target
|
§ 4.2
§ 2.1(c)
|
Cause
|
§ 8.3(a)
|
Change in Control
|
Plan
|
Code
|
Plan
|
Committee
|
2nd ¶
|
Corporation
|
1st ¶
|
Currency Exchange Risk
|
§ 16
|
DDE
|
§ 1.1(c)
|
Divestiture
|
§ 5.1(c)(ii)
|
Employee
|
Plan
|
Exchange Act
|
Plan
|
Fair Market Value
|
Plan
|
Good Reason
|
§ 8.3(b)
|
Insider
|
Plan
|
Maximum Award
|
§ 1.1(b)
|
Ownership Requirements
|
§ 14
|
Peer Performance Group
|
§ 3.1
|
Performance-Based Award
|
Plan
|
Performance Period
|
§ 1.2
|
Personal Data
|
§ 10
|
Plan
|
1st ¶
|
Post-Employment Conduct Agreement
|
4th ¶
|
PSU
|
§ 1.1(a)
|
Retirement
|
§ 5.1(c)(iii)
|
Return
|
§ 4.1(a)
|
ROIC
|
§ 4.1(a)
|
ROIC Performance Factor
ROIC Target
Share-Based Awards
|
§ 4.1
§ 2.1(b)
Plan
|
Stock
|
Plan
|
Stock Plan System
|
2nd ¶
|
Subsidiary
|
Plan
|
Target Award
|
1st ¶; § 1.1(a)
|
Tax Reform
|
§ 4.1(a)
|
Total Disability
|
§ 5.1(c)(i)
|
Total Stockholder Return
|
Plan; § 3.2(a)
|
Total Stockholder Return Performance Factor
|
§ 3.1; § 3.2
|
Vesting Period
|
§ 1.3
|
(i)
|
oversees, controls or affects the design, operation, research, manufacture, marketing, sale or distribution of “Competitive Products or Services” (as defined in Section 6) of or by the Restricted Company, or
|
(ii)
|
would involve a substantial risk that the “Confidential or Proprietary Information” (as defined in Section 1(c)) of the Corporation (including but not limited to technical information or intellectual property, strategic plans, information relating to pricing offered to the Corporation by vendors or suppliers or to prices charged or pricing contemplated to be charged by the Corporation, information relating to employee performance, promotions or identification for promotion, or information relating to the Corporation’s cost base) could be used to the disadvantage of the Corporation.
|
(a)
|
Represent any client in the same or a substantially related matter in which I represented the Corporation where the client’s interests are materially adverse to the Corporation; or
|
(b)
|
Disclose confidential information relating to my representation of the Corporation, including the disclosure of information that is to the disadvantage of the Corporation, except for information that is or becomes generally known.
|
(i)
|
existing and contemplated business, marketing and financial business information such as business plans and methods, marketing information, cost estimates, forecasts, financial data, cost or pricing data, bid and proposal information, customer identification, sources of supply, contemplated product lines, proposed business alliances, and information about customers or competitors, and
|
(ii)
|
existing and contemplated technical information and documentation pertaining to technology, know how, equipment, machines, devices and systems, computer hardware and software, compositions, formulas, products, processes, methods, designs, specifications, mask works, testing or evaluation procedures, manufacturing processes, production techniques, research and development activities, inventions, discoveries, and improvements, and
|
(i)
|
I will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that is made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney and solely for the purpose of reporting or investigating a suspected violation of law; or (2) in a complaint or other document that is filed under seal in a lawsuit or other proceeding.
|
(ii)
|
If I file a lawsuit for retaliation by the Corporation for reporting a suspected violation of law, I may disclose the Corporation’s trade secrets to my attorney and use the trade secret information in the court proceeding if I (1) file any document containing the trade secret under seal; and (2) do not disclose the trade secret, except pursuant to court order.
|
(ii)
|
The Corporation determines that either (a) my intentional misconduct or gross negligence, or (b) my failure to report another person’s intentional misconduct or gross negligence of which I had knowledge during the period I was employed by the Corporation, contributed to the Corporation having
|
(i)
|
The Corporation determines that I engaged in fraud, bribery or any other illegal act or that my intentional misconduct or gross negligence (including the failure to report the acts of another person of which I had knowledge during the period I was employed by the Corporation) contributed to another person’s fraud, bribery or other illegal act, which in any such case adversely affected the Corporation’s financial position or reputation;
|
(ii)
|
The Corporation determines that my intentional misconduct or gross negligence caused severe reputational or financial harm to the Corporation;
|
(iii)
|
The Corporation determines that I misappropriated Confidential or Proprietary Information, as defined in Section 1(c), and I (A) intended to use the misappropriated Confidential or Proprietary Information to cause severe reputational or financial harm to the Corporation or (B) used the misappropriated Confidential or Proprietary Information in a manner that caused severe reputational or financial harm to the Corporation; or
|
(vi)
|
Under such other circumstances specified by final regulation issued by the Securities and Exchange Commission entitling the Corporation to recapture or clawback “Benefits and Proceeds” (as defined below).
|
(i)
|
with respect to the Chairman, President and Chief Executive Officer, the Management and Development Committee of the Corporation’s Board of Directors;
|
(ii)
|
with respect to an Elected Officer, the Corporation’s Chairman, President and Chief Executive Officer; or
|
(iii)
|
with respect to all other employees, the Senior Vice President, Human Resources of the Corporation.
|
Title
|
Annual Base Pay Multiple
|
Chairman, President and Chief Executive Officer
|
6 times
|
Chief Operating Officer
|
5 times
|
Chief Financial Officer
|
4 times
|
Executive Vice Presidents
|
3 times
|
Senior Vice Presidents
|
2 times
|
Other Elected Officers
|
2 times
|
Other Vice Presidents
|
1 times
|
•
|
Shares owned directly.
|
•
|
Shares owned by a spouse or a trust.
|
•
|
Shares represented by monies invested in 401(k) Company Common Stock Funds or comparable plans.
|
•
|
Share equivalents as represented by income deferred to the Company Stock Investment Option of the Deferred Management Incentive Compensation Plan (DMICP).
|
•
|
Unvested Restricted Stock Units
|
Cash Flow Band
|
Cash Flow Performance Factor
|
Target + ≥$2.0B
|
200% (Maximum)
|
Target + $1.5B
|
175%
|
Target + $1.0B
|
150%
|
Target + $0.5B
|
125%
|
Target
|
100%
|
Target – $0.2B
|
75%
|
Target - $0.5B
|
50%
|
Target - $0.7B
|
25% (Threshold)
|
Section 10.
|
Data Privacy Consent For Employees Located Outside Of The United States.
|
Section 11.
|
No Assurance of Employment; No Right to an Award; Value of Award.
|
Average TSR
|
§ 3.2(a)
|
Award
|
1st ¶
|
Award Date
Cash-Based Award
Cash Flow
|
Header
Plan
§ 4.2(a)
|
Cash Flow Performance Factor
|
§ 4.2
|
Cash Flow Target
Cause
Change in Control
|
§ 2.1(c)
§ 8.2(a)
Plan
|
Code
Committee
|
Plan
2nd ¶
|
Corporation
|
1st ¶
|
Currency Exchange Risk
|
§ 16
|
Divestiture
Employee
Exchange Act
Good Reason
Insider
|
§ 5.1(c)(2)
Plan
Plan
§ 8.2(b)
Plan
|
Ownership Requirements
|
§ 14
|
Payable Portion
Peer Performance Group
|
§ 5.2(a)
§ 3.1
|
Performance-Based Award
Performance Period
|
Plan
§ 1.2
|
Personal Data
|
§ 10
|
Plan
|
1st ¶
|
Post-Employment Conduct Agreement
|
4th ¶
|
Potential Award
|
§ 2.1(d)
|
Retirement
Return
ROIC
|
§ 5.1(c)(3)
§ 4.1(a)
§ 4.1(a)
|
ROIC Performance Factor
ROIC Target
|
§ 4.1
§ 2.1(b)
|
Stock Plan System
|
2nd ¶
|
Subsidiary
|
Plan
|
Target Award
|
1st ¶, § 1.1
|
Tax Reform
|
§ 4.1(a)
|
Total Disability
Total Stockholder Return
|
§ 5.1(c)(1)
Plan; § 3.2(a)
|
Total Stockholder Return Performance Factor
|
§ 3.1; § 3.2
|
(i)
|
oversees, controls or affects the design, operation, research, manufacture, marketing, sale or distribution of “Competitive Products or Services” (as defined in Section 6) of or by the Restricted Company, or
|
(ii)
|
would involve a substantial risk that the “Confidential or Proprietary Information” (as defined in Section 1(c)) of the Corporation (including but not limited to technical information or intellectual property, strategic plans, information relating to pricing offered to the Corporation by vendors or suppliers or to prices charged or pricing contemplated to be charged by the Corporation, information relating to employee performance, promotions or identification for promotion, or information relating to the Corporation’s cost base) could be used to the disadvantage of the Corporation.
|
(iii)
|
Post-Employment Activity As a Lawyer – I acknowledge that as counsel to the Corporation, I owe ethical and fiduciary obligations to the Corporation and that at least some of these obligations will continue even after my Termination Date with the Corporation. I agree that after my Termination Date I will comply fully with all applicable ethical and fiduciary obligations that I owe to the Corporation. To the extent permitted by applicable law, including but not limited to any applicable rules governing attorney conduct, I agree that I will not:
|
(a)
|
Represent any client in the same or a substantially related matter in which I represented the Corporation where the client’s interests are materially adverse to the Corporation; or
|
(b)
|
Disclose confidential information relating to my representation of the Corporation, including the disclosure of information that is to the disadvantage of the Corporation, except for information that is or becomes generally known.
|
(i)
|
existing and contemplated business, marketing and financial business information such as business plans and methods, marketing information, cost estimates, forecasts, financial data, cost or pricing data, bid and proposal information, customer identification, sources of supply, contemplated product lines, proposed business alliances, and information about customers or competitors, and
|
(ii)
|
existing and contemplated technical information and documentation pertaining to technology, know how, equipment, machines, devices and systems, computer hardware and software, compositions, formulas, products, processes, methods, designs, specifications, mask works, testing or evaluation procedures, manufacturing processes, production techniques, research and development activities, inventions, discoveries, and improvements, and
|
(iii)
|
human resources and personnel information.
|
(i)
|
I will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that is made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney and solely for the purpose of reporting or investigating a suspected violation of law; or (2) in a complaint or other document that is filed under seal in a lawsuit or other proceeding.
|
(ii)
|
If I file a lawsuit for retaliation by the Corporation for reporting a suspected violation of law, I may disclose the Corporation’s trade secrets to my attorney and use the trade secret information in the court proceeding if I (1) file any document containing the trade secret under seal; and (2) do not disclose the trade secret, except pursuant to court order.
|
(i)
|
I breach any of the covenants or agreements in Section 1;
|
(ii)
|
The Corporation determines that either (a) my intentional misconduct or gross negligence, or (b) my failure to report another person’s intentional misconduct or gross negligence of which I had knowledge during the period I was employed by the Corporation, contributed to the Corporation having to restate all or a portion of its financial statements filed for any period with the Securities and Exchange Commission;
|
(iii)
|
The Corporation determines that I engaged in fraud, bribery or any other illegal act or that my intentional misconduct or gross negligence (including the failure to report the acts of another person of which I had knowledge during the period I was employed by the Corporation) contributed to another person’s fraud, bribery or other illegal act, which in any such case adversely affected the Corporation’s financial position or reputation;
|
(iv)
|
The Corporation determines that my intentional misconduct or gross negligence caused severe reputational or financial harm to the Corporation;
|
(v)
|
The Corporation determines that I misappropriated Confidential or Proprietary Information, as defined in Section 1(c), and I (A) intended to use the misappropriated Confidential or Proprietary Information to cause severe reputational or financial harm to the Corporation or (B) used the misappropriated Confidential or Proprietary Information in a manner that caused severe reputational or financial harm to the Corporation; or
|
(vi)
|
Under such other circumstances specified by final regulation issued by the Securities and Exchange Commission entitling the Corporation to recapture or clawback “Benefits and Proceeds” (as defined below).
|
(i)
|
with respect to the Chairman, President and Chief Executive Officer, the Management and Development Committee of the Corporation’s Board of Directors;
|
(ii)
|
with respect to an Elected Officer, the Corporation’s Chairman, President and Chief Executive Officer; or
|
(iii)
|
with respect to all other employees, the Senior Vice President, Human Resources of the Corporation.
|
Title
|
Annual Base Pay Multiple
|
|
|
Chairman, President and Chief Executive Officer
|
6 times
|
Chief Operating Officer
|
5 times
|
Chief Financial Officer
|
4 times
|
Executive Vice Presidents
|
3 times
|
Senior Vice Presidents
|
2 times
|
Other Elected Officers
|
2 times
|
Other Vice Presidents
|
1 times
|
•
|
Shares owned directly.
|
•
|
Shares owned by a spouse or a trust.
|
•
|
Shares represented by monies invested in 401(k) Company Common Stock Funds or comparable plans.
|
•
|
Share equivalents as represented by income deferred to the Company Stock Investment Option of the Deferred Management Incentive Compensation Plan (DMICP).
|
•
|
Unvested Restricted Stock Units
|
1.
|
CONSIDERATION FOR AWARD
|
2.
|
RIGHTS OF OWNERSHIP, RESTRICTIONS ON TRANSFER
|
3.
|
RESTRICTED PERIOD, FORFEITURE
|
4.
|
DEATH AND DISABILITY
|
5.
|
RETIREMENT, RESIGNATION OR TERMINATION WITH OR WITHOUT CAUSE
|
6.
|
DIVESTITURE
|
7.
|
CHANGE IN CONTROL DURING THE RESTRICTED PERIOD
|
(a)
|
“Cause” shall mean either of the following:
|
(i)
|
Conviction for an act of fraud, embezzlement, theft or other act constituting a felony (other than traffic-related offenses or as a result of vicarious liability); or
|
(ii)
|
Willful misconduct that is materially injurious to the Corporation’s financial position, operating results or reputation; provided, however that no act or failure to act shall be considered “willful” unless done, or omitted to be done, by you (a) in bad faith; (b) for the purpose of receiving an actual improper personal benefit in the form of money, property or services; or (c) in circumstances where you had reasonable cause to believe that the act, omission, or failure to act was unlawful.
|
(b)
|
“Good Reason” shall mean, without your express written consent, the occurrence of any one or more of the following after the Change in Control:
|
(i)
|
A material and substantial reduction in the nature or status of your authority or responsibilities;
|
(ii)
|
A material reduction in your annualized rate of base salary;
|
(iii)
|
A material reduction in the aggregate value of your level of participation in any short or long term incentive cash compensation plan, employee benefit or retirement plan or compensation practices, arrangements, or policies;
|
(iv)
|
A material reduction in the aggregate level of participation in equity-based incentive compensation plans; or
|
(v)
|
Your principal place of employment is relocated to a location that is greater than 50 miles from your principal place of employment on the date the Change in Control is consummated.
|
8.
|
AMENDMENT AND TERMINATION OF PLAN OR AWARDS
|
9.
|
ACCEPTANCE OF AWARD AGREEMENT; ELECTRONIC DELIVERY
|
10.
|
DATA PRIVACY CONSENT FOR EMPLOYEES LOCATED OUTSIDE OF THE UNITED STATES
|
11.
|
EMPLOYEE ACKNOWLEDGEMENT
|
12.
|
MISCELLANEOUS
|
•
|
33-63155 on Form S-8, dated October 3, 1995;
|
•
|
33-58083 on Form S-8 (Post-Effective Amendment No. 1), dated January 22, 1997;
|
•
|
333-20117 and 333-20139 on Form S-8, each dated January 22, 1997;
|
•
|
333-27309 on Form S-8, dated May 16, 1997;
|
•
|
333-37069 on Form S-8, dated October 2, 1997;
|
•
|
333-40997 on Form S-8, dated November 25, 1997;
|
•
|
333-58069 on Form S-8, dated June 30, 1998;
|
•
|
333-92197 on Form S-8, dated December 6, 1999;
|
•
|
333-92363 on Form S-8, dated December 8, 1999;
|
•
|
333-78279 on Form S-8 (Post-Effective Amendment No. 2), dated August 3, 2000;
|
•
|
333-56926 on Form S-8, dated March 12, 2001;
|
•
|
333-105118 on Form S-8, dated May 9, 2003;
|
•
|
333-113769, 333-113770, 333-113771, 333-113772, and 333-113773 on Form S-8, each dated March 19, 2004;
|
•
|
333-115357 on Form S-8, dated May 10, 2004;
|
•
|
333-127084 on Form S-8, dated August 1, 2005;
|
•
|
333-146963 on Form S-8, dated October 26, 2007;
|
•
|
333-155687 on Form S-8, dated November 25, 2008;
|
•
|
333-162716 on Form S-8, dated October 28, 2009;
|
•
|
333-155684 on Form S-8 (Post-Effective Amendment No. 1), dated August 23, 2011;
|
•
|
333-176440 on Form S-8, dated August 23, 2011;
|
•
|
333-188118 on Form S-8, dated April 25, 2013;
|
•
|
333-195466 on Form S-8, dated April 24, 2014 and July 23, 2014 (Post-Effective Amendment No.1);
|
•
|
333-219373 on Form S-3, dated July 20, 2017; and
|
•
|
333-219374 on Form S-3, dated July 20, 2017.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Lockheed Martin Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ Marillyn A. Hewson
|
|
|
|
Marillyn A. Hewson
|
|
|
|
Chief Executive Officer
|
|
Date: April 22, 2020
|
|
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Lockheed Martin Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ Kenneth R. Possenriede
|
|
|
|
Kenneth R. Possenriede
|
|
|
|
Chief Financial Officer
|
|
Date: April 22, 2020
|
|
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.
|
|
|
|
/s/ Marillyn A. Hewson
|
|
|
|
|
Marillyn A. Hewson
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
/s/ Kenneth R. Possenriede
|
|
|
|
|
Kenneth R. Possenriede
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
|
Date: April 22, 2020
|
|
|
|
|