Hello and welcome to Lockheed Martin Corporation 2025 Annual Meeting of Stockholders. Please note that today's meeting is being recorded. At the conclusion of the business of the meeting, we will have a discussion period. If you access the meeting by entering the control number provided to you in your proxy materials, you may submit one question or comment at any time by clicking the Q&A icon near the top right of your screen, typing your question into the box that appears, and then clicking Send. Please also be advised that remarks made during today's meeting may include forward-looking statements covering future events, that the company's actual results may differ materially from those projected in the statements.
Please refer to our SEC filings, including our 2024 Form 10-K and first quarter 2025 Form 10-Q, for information on factors that could cause actual results to differ materially from those in the forward-looking statements. These filings are available on Lockheed Martin's website and on the SEC's website. It is now my pleasure to turn today's meeting over to Jim Taiclet, Chairman, President, and Chief Executive Officer of Lockheed Martin Corporation. Mr. Taiclet, the floor is yours.
Thank you and good morning, everyone. Welcome to Lockheed Martin's 2025 Annual Meeting of Stockholders. I would like to start by thanking our Lockheed Martin team, many of whom are stockholders, for their remarkable work and ingenuity that enables our enterprise-wide transformation and advances our 21st-century security vision. I would also like to thank the stockholders who have taken the time to join our meeting today. We appreciate your continued investment in Lockheed Martin. This meeting is hereby called to order. Joining us for today's meeting are members of our management team, including Frank St.
John, our Chief Operating Officer; Evan Scott, our Chief Financial Officer; Kevin O'Connor, our Senior Vice President, General Counsel, and Corporate Secretary, who will act as the Secretary of the Meeting; Chris Wronsky, our Senior Vice President and Chief Human Resources Officer; Leo Mackay, our Senior Vice President of Ethics and Enterprise Assurance; and Maria Ricciardone, our Vice President, Treasurer, and investor Relations. We're also joined by members of the Board of Directors, including Bruce Carlson, who has reached our mandatory retirement age and is not standing for reelection. I would personally like to thank Bruce, who served as a director since 2015, for his many years of dedicated service and contributions to the board and our company. A representative from Ernst & Young LLP, our independent auditors, is present and will be available to answer questions during the discussion period.
Also present are representatives of Computershare Trust Company, who have been appointed to serve as the inspectors of election at the meeting. As we begin, please note that the agenda and the rules and procedures that we will be following today are posted on the virtual meeting site. Stockholders who wish to submit a question for the discussion period may do so at any point during the meeting, and those who wish to vote during the meeting may do so until I announce that the polls have been closed. If you have already voted, there is no need to vote during the meeting unless you wish to change your vote. Kevin O'Connor has advised me that the notice of this meeting, the proxy statement, and the annual report were duly and properly distributed to all stockholders of record as of the close of business on February 28, 2025.
The inspectors of election have reported that a quorum of stockholders is present to conduct the meeting based on stockholder proxies received. With the notice and quorum requirements of our bylaws satisfied, we may proceed with today's meeting. Now to the official business of this meeting. The proxy statement includes detailed information regarding each of the five proposals to be voted upon today. Please note that proposal six was withdrawn. At this time, I introduce and present proposals one through three. Proposal one is the election of 10 directors to serve on the board of directors. The board recommends for each nominee. Proposal two is the advisory vote to approve the compensation of our named executive officers. The board recommends for proposals. Proposal three is the ratification of the appointment of Ernst & Young LLP as our independent auditors for 2025. The board recommends for proposals.
Proposals four and five are stockholder proposals that will be introduced and presented by their proponents. The Board recommends against these proposals. I now invite the stockholder who submitted proposal four, requesting a stockholder approval requirement for excessive golden parachutes, to present the proposal. Operator, please activate the proponent slot.
Hello, this is John Chavedden. Proposal four, general approval requirement for excessive golden parachutes. This requests that the board seeks general approval of any senior manager's new or renewed pay package that provides for severance payments with an estimated value exceeding 2.99 times the sum of the executive base salary plus target short-term bonus. This proposal only applies to the named executive officers. This provision shall be included in the governance guidelines of the company and be readily accessible on the company website. The board shall retain the option to seek serial approval after material terms are agreed upon. Unfortunately, many companies only limit cash golden parachutes to the 2.99 figure, which means that there is no limit on non-cash golden parachutes. This proposal is relevant even if there are current golden parachute limits. A limit on golden parachutes is like a speed limit.
A speed limit by itself does not guarantee that the speed limit will never be exceeded. Like this proposal, the rules associated with the speed limit provide consequences if the limit is exceeded. With this proposal, the consequences are a non-binding shareholder vote is required for reasonably rich golden parachutes. This proposal places no limit on long-term equity pay or any other type pay. This proposal thus has no impact on the ability to attract executive talent and does not discourage the use of long-term equity pay because it places no limit on golden parachutes. It simply requires that overly rich golden parachutes be subject to a non-binding shareholder vote at a shareholder meeting already scheduled for other matters. This proposal is relevant because the annual stay on executive pay vote does not have a separate section for approving or rejecting golden parachutes.
This proposal topic received between 51% and 65% support at FedEx, Spirit AeroSystems, and Alaska Air. Please vote yes to shareholder approval requirement for excessive golden parachutes, Proposal four.
Thank you. The line is now muted.
Thank you for presenting the proposal. It has been properly submitted. I now invite the operator to play a recorded message on behalf of the shareholder who submitted proposal five, requesting a report on alignment of political activities with human rights policy. Operator, please play the proponent statement.
Thank you. We will play the statement.
Good morning, members of the board and shareholders. My name is Tom McCaney, and I represent the Sisters of St. Francis of Philadelphia. I'm here today to move shareholder proposal number five, which calls for an alignment report of Lockheed's political activities with its human rights policy. We encourage all shareholders to support the proposal. As people of faith, we believe there is a clear moral responsibility for Lockheed and its investors to acknowledge the direct role the defense industry plays in perpetuating human rights harms in war and conflict. Despite its commitments to uphold the highest standards of human rights, Lockheed and its peers spend significant funds on direct and indirect lobbying, electioneering, and think tank donations. In 2024 alone, Lockheed spent over $12 million on federal lobbying. Investors are concerned that these opaque political activities may undermine its own human rights commitments.
Independent reporting has shown that Lockheed has continued to lobby to keep its contracts and weapons supplies to multiple states engaged in conflict and connected to human rights violations, including Saudi Arabia, the United Arab Emirates, and Israel. For example, Lockheed continues to lobby heavily to maintain and increase the F-35 budget, even though these fighter jets have been used in Israel's attacks against Palestinian civilians in Gaza and are connected to apparent war crimes. Despite this, in June 2024, Israel signed a $3 billion deal with Lockheed to sell 25 F-35s to Israel. We are asking for more transparency in Lockheed's political activities. Reputational damage that comes from misalignment can harm a company's performance, and most importantly, political activities promoting war and conflict can cause irreparable harm, including the loss of human life, which we hold sacred.
This proposal is an invitation to deeply examine the business model in the context of Lockheed's human rights commitments and political activities, and a call for the company to stop incentivizing war. We therefore urge all shareholders to support this proposal for Lockheed to produce a political activities alignment report. Thank you.
Thank you. The recorded statement has ended.
Thank you. The proposal has been properly submitted. That concludes the presentation of the proposals. The polls will close in one minute to allow stockholders time to complete their online voting on all proposals properly presented.
Time has elapsed.
Thank you. The polls are now closed. At this time, I'd like to announce the preliminary voting results for the proposals properly presented today. The preliminary results are based on all proxies returned as of this morning prior to the meeting. After the meeting, inspectors will count any additional votes received through closing of the polls. Official results will be announced by the filing of a Form 8-K with the SEC within four business days. The preliminary results are: Proposal one, each of the 10 director nominees is elected to the Board of Directors. Proposal two, the compensation of our named executive officers is approved on an advisory basis. Proposal three, the appointment of Ernst & Young LLP as our independent auditors for 2025 is ratified. Proposal four, the stockholder proposal requesting shareholder approval requirement for excessive golden parachutes is not approved.
Proposal five, the stockholder proposal requesting a report on alignment of political activities with the human rights policy is not approved. Your board and management team take seriously the feedback that we receive from you, our stockholders. We want to thank you for that input and for your participation in the voting process today. The board will discuss today's voting outcomes at its next meeting. This concludes the official business of our meeting today, and the meeting is now adjourned. We will now take questions from our stockholders. We'll answer as many questions as we can during the remaining time available. I will now turn to Maria Ricciardone to moderate the Q&A. Over to you, Maria.
Thank you, Jim. As a reminder to our stockholders on the call, you may submit a question by clicking the Q&A icon near the top right of your screen, typing your question into the box that appears, and then clicking Send. For the first question, if the Trump administration is able to bring peace to the Middle East and the Ukraine, will this result in lower revenues for the coming two to three years?
Myself and everyone at Lockheed Martin strongly support the Trump administration's efforts to bring peace to the Middle East and to Ukraine and to preserve peace around the world. While we may be in the aerospace industry, our product is deterrence from armed conflict, and we aim to keep deterring armed conflict through strength and to provide the most effective tools to do that that anyone can do in the world. This company is the best at that. Our goal is providing deterrence to armed conflict and preserving peace. I don't expect our revenues to go down with peace. I expect our products and services to demonstrate their capabilities into the future and be in high demand and to preserve peace in the future.
Thank you. Next question. Is there a chance the x-59 will be canceled due to delays?
We are on pace and on target with the x-59 program, low-boom supersonic jet. I've spoken about it to the most senior levels of government, and there is great interest in the program. We have had no interruptions or requests to either slow down or stop the x-59 program.
Thank you. The next question. The company has in place a director resignation provision that provides the board post-election discretion to determine whether to accept or reject the resignation of an incumbent director who fails to be reelected. Does the provision undermine the voting rights of shareholders by allowing the board to have the final say on the unelected director's status?
We believe this provision is important and effective and gives the board the discretion to make good decisions based on individual circumstances should a director receive less than 50% of the vote. I think it actually preserves shareholder rights and the ability of the board to really manage the company's affairs to the specific circumstance.
Great. Thank you. It appears that there are no additional questions today. I will turn it back over to you, Jim.
Thank you all for your questions and comments. I also want to thank everyone who attended today's meeting. This concludes our 2025 annual stockholders meeting.
This concludes the meeting, and you may now disconnect.
Hello and welcome to Lockheed Martin Corporation's 2025 Annual Meeting of Stockholders. Please note that today's meeting is being recorded. At the conclusion of the business of the meeting, we will have a discussion period. If you access the meeting by entering the control number provided to you in your proxy materials, you may submit one question or comment at any time by clicking the Q&A icon near the top right of your screen, typing your question into the box that appears, and then clicking Send. Please also be advised that remarks made during today's meeting may include forward-looking statements covering future events, that the company's actual results may differ materially from those projected in the statements.
Please refer to our SEC filings, including our 2024 Form 10-K and first quarter 2025 Form 10-Q, for information on factors that could cause actual results to differ materially from those in the forward-looking statements. These filings are available on Lockheed Martin's website and on the SEC's website. It is now my pleasure to turn today's meeting over to Jim Taiclet, Chairman, President, and Chief Executive Officer of Lockheed Martin Corporation. Mr. Taiclet, the floor is yours.
Thank you. Good morning, everyone. Welcome to Lockheed Martin's 2025 Annual Meeting of Stockholders. I would like to start by thanking our Lockheed Martin team, many of whom are stockholders, for their remarkable work and ingenuity that enables our enterprise-wide transformation and advances our 21st-century security vision. I would also like to thank the stockholders who have taken the time to join our meeting today. We appreciate your continued investment in Lockheed Martin. This meeting is hereby called to order. Joining us for today's meeting are members of our management team, including Frank St. John.
John, our Chief Operating Officer; Evan Scott, our Chief Financial Officer; Kevin O'Connor, our Senior Vice President, General Counsel, and Corporate Secretary, who will act as the Secretary of the Meeting; Chris Wronsky, our Senior Vice President and Chief Human Resources Officer; Leo Mackay, our Senior Vice President of Ethics and Enterprise Assurance; and Maria Ricciardone, our Vice President, Treasurer, and investor relations. We're also joined by members of the Board of Directors, including Bruce Carlson, who has reached our mandatory retirement age and is not standing for reelection. I would personally like to thank Bruce, who served as a director since 2015, for his many years of dedicated service and contribution to the board and our company. A representative from Ernst & Young LLP, our independent auditors, is present and will be available to answer questions during the discussion period.
Also present are representatives of Computershare Trust Company, who have been appointed to serve as the inspectors of election at the meeting. As we begin, please note that the agenda and the rules and procedures that we will be following today are posted on the virtual meeting site. Stockholders who wish to submit a question for the discussion period may do so at any point during the meeting, and those who wish to vote during the meeting may do so until I announce that the polls have been closed. If you have already voted, there is no need to vote during the meeting unless you wish to change your vote. Kevin O'Connor has advised me that the notice of this meeting, the proxy statement, and the annual report were duly and properly distributed to all stockholders of record as of the close of business on February 28, 2025.
The inspectors of election have reported that a quorum of stockholders is present to conduct the meeting based on stockholder proxies received. With the notice and quorum requirements of our bylaws satisfied, we may proceed with today's meeting. Now to the official business of this meeting. The proxy statement includes detailed information regarding each of the five proposals to be voted upon today. Please note that proposal six was withdrawn. At this time, I introduce and present proposals one through three. Proposal 1 is the election of 10 directors to serve on the Board of Directors. The board recommends for each nominee. Proposal two is the advisory vote to approve the compensation of our named executive officers. The board recommends for proposal two. Proposal three is the ratification of the appointment of Ernst & Young LLP as our independent auditors for 2025. The board recommends for proposal three.
Proposals four and five are stockholder proposals that will be introduced and presented by their proponents. The board recommends against these proposals. I now invite the stockholder who submitted proposal four, requesting a shareholder approval requirement for excessive golden parachutes, to present the proposal. Operator, please activate the proponent's line.
Hello, this is John Chavedden. Proposal four, shareholder approval requirement for excessive golden parachutes. Charles requests that the board seeks shareholder approval of any senior manager's new or renewed pay package that provides for severance payments with an estimated value exceeding 2.99 times the sum of the executive base salary plus target short-term bonus. This proposal only applies to the named executive officers. This provision shall be included in the governance guidelines of the company and be readily accessible on the company website. The board shall retain the option to seek shareholder approval after material terms are agreed upon. Unfortunately, many companies only limit cash golden parachutes to the 2.99 figure, which means that there is no limit on non-cash golden parachutes. This proposal is relevant even if there are current golden parachute limits. A limit on golden parachutes is like a speed limit.
A speed limit by itself does not guarantee that the speed limit will never be exceeded. Like this proposal, the rules associated with the speed limit provide consequences if the limit is exceeded. With this proposal, the consequences are a non-binding shareholder vote is required for reasonably rich golden parachutes. This proposal places no limit on long-term equity pay or any other type pay. This proposal thus has no impact on the ability to attract executive talent and does not discourage the use of long-term equity pay because it places no limit on golden parachutes. It simply requires that overly rich golden parachutes be subject to a non-binding shareholder vote at a shareholder meeting already scheduled for other matters. This proposal is relevant because the annual say on executive pay vote does not have a separate section for approving or rejecting golden parachutes.
This proposal topic received between 51% and 65% support at FedEx, Spirit AeroSystems, and Alaska Air. Please vote yes to shareholder approval requirement for excessive golden parachutes, Proposal four.
Thank you. The line is now muted.
Thank you for presenting the proposal. It has been properly submitted. I now invite the operator to play a recorded message on behalf of the shareholder who submitted proposal five, requesting a report on alignment of political activities with human rights policy. Operator, please play the proponent's statement.
Thank you. We will play the statement.
Good morning, members of the board and shareholders. My name is Tom McCaney, and I represent the Sisters of St. Francis of Philadelphia. I'm here today to move shareholder proposal number five, which calls for an alignment report of Lockheed's political activities with its human rights policy. We encourage all shareholders to support the proposal. As people of faith, we believe there is a clear moral responsibility for Lockheed and its investors to acknowledge the direct role the defense industry plays in perpetuating human rights harms in war and conflict. Despite its commitments to uphold the highest standards of human rights, Lockheed and its peers spend significant funds on direct and indirect lobbying, electioneering, and think tank donations. In 2024 alone, Lockheed spent over $12 million on federal lobbying. Investors are concerned that these opaque political activities may undermine its own human rights commitments.
Independent reporting has shown that Lockheed has continued to lobby to keep its contracts and weapons supplies to multiple states engaged in conflict and connected to human rights violations, including Saudi Arabia, the United Arab Emirates, and Israel. For example, Lockheed continues to lobby heavily to maintain and increase the F-35 budget, even though these fighter jets have been used in Israel's attacks against Palestinian civilians in Gaza and are connected to apparent war crimes. Despite this, in June 2024, Israel signed a $3 billion deal with Lockheed to sell 25 F-35s to Israel. We are asking for more transparency in Lockheed's political activities. Reputational damage that comes from misalignment can harm a company's performance, and most importantly, political activities promoting war and conflict can cause irreparable harm, including the loss of human life, which we hold sacred.
This proposal is an invitation to deeply examine the business model in the context of Lockheed's human rights commitments and political activities, and a call for the company to stop incentivizing war. We therefore urge all shareholders to support this proposal for Lockheed to produce a political activities alignment report. Thank you.
Thank you. The recorded statement has ended.
Thank you. The proposal has been properly submitted. That concludes the presentation of the proposals. The polls will close in one minute to allow stockholders time to complete their online voting on all proposals properly presented.
Time has elapsed.
Thank you. The polls are now closed. At this time, I'd like to announce the preliminary voting results for the proposals properly presented today. The preliminary results are based on all proxies returned as of this morning prior to the meeting. After the meeting, inspectors will count any additional votes received through closing of the polls. Official results will be announced by the filing of a Form 8-K with the SEC within four business days. The preliminary results are: Proposal one, each of the 10 director nominees is elected to the Board of Directors. Proposal two, the compensation of our named executive officers is approved on an advisory basis. Proposal three, the appointment of Ernst & Young LLP as our independent auditors for 2025 is ratified. Proposal four, the stockholder proposal requesting shareholder approval requirement for excessive golden parachutes is not approved.
Proposal five, the stockholder proposal requesting a report on alignment of political activities with the human rights policy is not approved. Your board and management team take seriously the feedback that we receive from you, our stockholders. We want to thank you for that input and for your participation in the voting process today. The board will discuss today's voting outcomes at its next meeting. This concludes the official business of our meeting today, and the meeting is now adjourned. We will now take questions from our stockholders. We'll answer as many questions as we can during the remaining time available. I will now turn to Maria Ricciardone to moderate the Q&A. Over to you, Maria.
Thank you, Jim. As a reminder to our stockholders on the call, you may submit a question by clicking the Q&A icon near the top right of your screen, typing your question into the box that appears, and then clicking Send. For the first question, if the Trump administration is able to bring peace to the Middle East and the Ukraine, will this result in lower revenues for the coming two to three years?
Myself and everyone at Lockheed Martin strongly support the Trump administration's efforts to bring peace to the Middle East and to Ukraine and to preserve peace around the world. While we may be in the aerospace industry, our product is deterrence from armed conflict, and we aim to keep deterring armed conflict through strength and to provide the most effective tools to do that that anyone can do in the world. This company is the best at that. Our goal is providing deterrence to armed conflict and preserving peace. I do not expect our revenues to go down with peace. I expect our products and services to demonstrate their capabilities into the future and be in high demand and to preserve peace in the future.
Thank you. Next question, is there a chance the x-59 will be canceled due to delays?
We are on pace and on target with the x-59 program, low-boom supersonic jet. I've spoken about it to the most senior levels of government, and there's great interest in the program. We have had no interruptions or requests to either slow down or stop the x-59 program.
Thank you. The next question, the company has in place a director resignation provision that provides the board post-election discretion to determine whether to accept or reject the resignation of an incumbent director who fails to be re-elected. Does the provision undermine the voting rights of shareholders by allowing the board to have the final say on the unelected director's status?
We believe this provision is important and effective and gives the board the discretion to make good decisions based on individual circumstances should a director receive less than 50% of the vote. I think it actually preserves shareholder rights and the ability of the board to really manage the company's affairs to the specific circumstance.
Great. Thank you. It appears that there are no additional questions today. I will turn it back over to you, Jim.
Thank you all for your questions and comments. I also want to thank everyone who attended today's meeting. This concludes our 2025 annual stockholders meeting.
This concludes the meeting, and you may now disconnect.