Lockheed Martin Equity FAQ

Standard RSU grants at Lockheed Martin have a 3-year cliff vesting schedule, meaning 100% of your RSUs vest after three years. This is a backloaded schedule, so you won't receive any shares until the full three-year period is complete. Annual refresher grants may follow the same pattern, with RSUs representing approximately 30% of long-term incentive opportunities.

Yes, Lockheed Martin offers an ESPP with a 15% discount and a lookback provision. The plan has 12-month offering periods with semi-annual purchases every 6 months, and the lookback period is 6 months. You can contribute up to $25,000 per year to purchase company stock at a discount.

Stock options at Lockheed Martin typically vest in three equal installments: one-third on each of the first, second, and third anniversaries of the grant date. You have 10 years from the grant date to exercise your options before they expire. The company offers both ISOs (Incentive Stock Options) and NSOs (Non-Qualified Stock Options).

From a tax perspective, ESPP shares are often recommended to be sold last compared to RSUs or stock options due to favorable tax treatment for qualifying dispositions. A qualifying disposition occurs if you hold shares for over 1 year after purchase AND over 2 years after the offering date, which can result in more favorable capital gains treatment on a portion of your gain.

Lockheed Martin's default tax withholding rate for RSUs is 100%, though you can adjust this rate. Keep in mind that if you're a Section 16 Insider and elect a lower withholding rate, you could face additional tax liability. When your RSUs vest, they're taxed as ordinary income at your marginal tax rate.

Yes, Lockheed Martin offers a 401(k) with a generous company match: 50% on the first 8% you contribute (up to $12,000 maximum), plus an automatic 6% contribution for non-represented employees. You're immediately vested in all employer contributions, and the plan offers both traditional and Roth 401(k) options. The company also has a Deferred Management Incentive Compensation Plan (DMICP) for executive officers.

Your unvested RSUs and options will typically be forfeited when you leave the company, unless you meet retirement eligibility requirements which may trigger vesting acceleration. For vested stock options, you'll need to exercise them before they expire (within the 10-year window from grant date). Note that executive-level employees may be subject to a Post-Employment Conduct Agreement with non-compete provisions lasting 1-2 years.

Quarterly trading blackout periods begin 14 days before the accounting closing date for each quarter and continue until the market opens the day after earnings are publicly announced (with at least one full trading day elapsed). For Q4, the blackout starts on December 18th. Additionally, short sales, publicly traded options, hedging transactions, and pledging securities are prohibited at all times.