Summary
Lockheed Martin Corporation (LMT) filed an 8-K on November 2, 2005, reporting on several key corporate governance and financial communication events that occurred on or around October 28, 2005. The most significant announcement for investors pertains to the compensation of non-employee directors. The Board of Directors approved an increase in the annual cash retainer for these directors from $75,000 to $90,000, effective November 1, 2005. Additionally, the equity-based award value under the Directors Equity Plan will also increase to $90,000, effective January 1, 2006. Committee chairmen will also see increased retainers. Furthermore, the company announced its intention to reaffirm its 2005 and 2006 financial projections during an upcoming investor conference on November 8, 2005. This communication is designed to provide clarity and reinforce investor confidence in the company's financial outlook. Minor amendments to the company's bylaws were also made to clarify the Nominating and Corporate Governance Committee's authority regarding the selection of search firms for director candidates.
Key Highlights
- 1Non-employee director annual cash retainer increased from $75,000 to $90,000, effective November 1, 2005.
- 2Annual equity-based award for non-employee directors to increase to $90,000 (fair market value) effective January 1, 2006.
- 3Increased annual retainers for various committee chairmen, including a higher amount for the Audit Committee Chairman.
- 4Amendments to the Lockheed Martin Directors Equity Plan and Directors Deferred Compensation Plan were made to comply with Section 409A of the Internal Revenue Code.
- 5The Nominating and Corporate Governance Committee's sole authority to retain and terminate search firms for director candidates was clarified in the bylaws.
- 6Lockheed Martin plans to reaffirm its 2005 and 2006 financial projections at an investor conference on November 8, 2005.
- 7The investor conference will be webcast, providing broad access to the financial outlook reaffirmation.