US Deal on F-35s Allows Lockheed to Win Back Withheld Payments

The Pentagon has agreed with Lockheed Martin Corp. on milestones the company can reach by year-end to earn some of a potential $500 million payment withheld for F-35 jets lacking necessary hardware and software upgrades, according to the US program manager.

That agreement also includes a $350 million investment by Lockheed into the Pentagon’s F-35 software development labs and testing facilities, the program manager, Lt. Gen. Michael Schmidt said in an interview.

Lockheed expects it will deliver by Dec. 31 between 75 and 110 of the upgraded F-35s, including both new aircraft and backlogged jets, the company has said. Lockheed ...