Document:

Exhibit 10-r-1

 

AGREEMENT AND GENERAL RELEASE

 

 

NEAL

J. KEATING, on the one hand, and ROCKWELL COLLINS, INC., on the other hand,

have reached the following Agreement and General Release (hereinafter the

“Agreement”).  In this Agreement,

“EMPLOYEE” refers to NEAL J. KEATING, and “COMPANY” refers to Rockwell Collins,

Inc. and its subsidiaries and affiliates.

 

FIRST:                                                                                                           Benefits.

 

a)                                      EMPLOYEE

and COMPANY agree to the following:

i)                                         EMPLOYEE

will cease actively working for COMPANY as of 4:00 p.m. on May 28, 2002.   Thereafter, EMPLOYEE will remain on COMPANY’s active payroll from

May 28, 2002 through the close of business on July 6, 2004 (hereinafter

referred to as his “salary continuation period”), at which time EMPLOYEE will

be placed on layoff.  EMPLOYEE will receive

no additional pay or notice at the time of his layoff.  EMPLOYEE will not be expected to perform any

work for the COMPANY during his salary continuation period and will not accrue

vacation or receive long term disability insurance coverage.  During his salary continuation period,

EMPLOYEE will be paid at his current monthly base salary rate as of May 28,

2002.  Except as provided in the Eighth

Paragraph of this Agreement, COMPANY will continue to pay EMPLOYEE salary

continuation whether or not he obtains other employment during the salary

continuation period.  Except as

otherwise provided in this Agreement, EMPLOYEE agrees to return to the COMPANY

by no later than June 4, 2002 all property of the COMPANY which has been

entrusted to EMPLOYEE for purposes of his employment including but not limited

to company proprietary documents, company telephone lists, credit cards, keys,

badges and personal digital assistants (such as a Palm Pilot).

ii)                                      EMPLOYEE

will receive a pro-rata (8/12ths) share of his Fiscal Year 2002 Incentive

Compensation, less all applicable federal, state and local taxes and other

applicable deductions, at the time the Fiscal Year 2002 ICP is paid out to the

other participants and in accordance with and based upon Rockwell Collins

Inc.’s Incentive Compensation Plan (“ICP”) and the enterprise performance

criteria approved by the Compensation Committee of the COMPANY.  COMPANY and EMPLOYEE further agree that

EMPLOYEE shall not be eligible to receive any incentive compensation or bonus

for the COMPANY’s Fiscal Years 2003 and 2004.

 

 

iii)                                   EMPLOYEE

will receive a pro-rata (8/24ths) share of the Fiscal Years  2002-2003 cash long term incentive plan

(“cash LTIP”) payment, less all applicable federal, state and local taxes and

other applicable deductions, at the time the cash LTIP is paid out to the other

participants and in accordance with and based upon the Rockwell Collins, Inc.

2001 Long-Term Incentives Plan and the enterprise performance criteria approved

by the Compensation Committee of the COMPANY. 

COMPANY and EMPLOYEE further agree that EMPLOYEE will not be eligible to

participate in any future cash LTIP programs, if any, for the COMPANY’s Fiscal

Years 2003 and 2004.

iv)                                  EMPLOYEE

shall not be eligible for award of any stock option grants after May 28,

2002.  Previously granted stock options

may be exercised, will vest, and will be forfeited according to the terms and

conditions of the COMPANY’S stock option plans and any written agreements

between COMPANY and EMPLOYEE related thereto.

v)                                     Within

15 days of EMPLOYEE signing this Agreement, COMPANY will pay EMPLOYEE for all

of his accrued but unused vacation during EMPLOYEE’s employment with COMPANY

through May 28, 2002, after taking into account EMPLOYEE’S use of vacation

covering the period from May 28, 2002 through July 6, 2002.

 

b)                     In addition, except as noted in

subparagraph iii) below, COMPANY and EMPLOYEE agree that the EMPLOYEE will be

provided the following benefits until July 6, 2004:

i)                                         COMPANY

will continue to provide EMPLOYEE a monthly car allowance of $1,700.

ii)                                      Outplacement

services or career transition counseling.

iii)                                   Reimbursement

for out of pocket income tax preparation/estate planning expenses in an amount

not to exceed $5,000 for each Calendar Years 2002, 2003, and 2004 (EMPLOYEE may

seek reimbursement for such expenses related to Calendar Year 2004 until April

15, 2005).

iv)                                  An

annual COMPANY paid executive physical in Fiscal Years 2002 and 2003.

v)                                     Continued

use of the COMPANY provided cellular telephone and continued use of the Sprint

VPN FONCARD (the telephone bills of which are paid for by the COMPANY) for the

sole purpose of seeking employment with another company.

vi)                                  Medical,

including vision and dental, benefits coverage for amounts and under terms and

conditions comparable to that being provided to the active executive vice

presidents working at the COMPANY during the salary continuation period.

vii)                               COMPANY

will continue to pay the membership dues and assessments at the Elmcrest

Country Club.

 

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viii)                            EMPLOYEE

will be eligible to contribute to the COMPANY’s retirement savings plan for

salaried employees (including the COMPANY matching contributions).

ix)                                    COMPANY

will permit EMPLOYEE to continue using the COMPANY-provided lap top computer

currently in his possession, provided, however, that EMPLOYEE provides the

COMPANY access to that computer by no later than June 4, 2002 so that COMPANY

can inspect the hard drive and delete any COMPANY proprietary information or software,

as necessary to comply with license agreements with third parties, contained

therein and remove any COMPANY Network access.

x)                                       Life

insurance and other death benefit coverage for amounts and under terms and

conditions comparable to that being provided to the active executive vice

presidents working at the COMPANY during the salary continuation period (it

being understood, however, that such benefits shall not include any short-term

or long-term disability coverages).

 

c)                                      COMPANY

and EMPLOYEE specifically acknowledge and agree that any entitlement by

EMPLOYEE to certain benefits provided by this First Paragraph is subject to

forfeiture pursuant to the Eighth Paragraph of this Agreement.

d)                     In addition, any COMPANY property used

by EMPLOYEE during the salary continuation period must be returned to the

COMPANY by no later than   July 6, 2004.

e)                      EMPLOYEE agrees to inform the COMPANY’s

General Counsel within two business days after obtaining full or part time

reemployment whether as an employee, consultant, agent, director, or otherwise.

 

SECOND:                                                                                            No

Obligation to Provide These Benefits Under Normal Policies.

 

EMPLOYEE

acknowledges that, under COMPANY’S normal policies and procedures and absent

this Agreement, he would receive only 13 weeks rather than 24 months of salary

continuation and medical coverage between the date he stops work for the

COMPANY and the date of his layoff, he would not receive pro-rata Fiscal Year

2002 incentive compensation, he would not receive a pro-rata Fiscal Years

2002-2003 cash LTIP payment; he would not be eligible to contribute to the

COMPANY’s retirement savings plan for salaried employees (including the COMPANY

matching contributions); he would not continue using the COMPANY-provided lap

top computer currently in his possession; he would not receive a car allowance

of $1,700 per month for two years to defray automobile expenses; and he would

not be eligible to receive $5,000 in income tax preparation/estate planning

benefits for three calendar years, to receive an annual COMPANY paid physical

for two years, to receive continued use of his cellular telephone and Sprint

VPN FONCARD for two years, to receive the country club membership paid for by

the COMPANY for two years and to receive free outplacement services for two

years, which benefits are set forth in the First Paragraph of this Agreement.

 

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THIRD:                                                                                                       Complete

Mutual Release.

 

EMPLOYEE

and COMPANY agree to release each other and each of their predecessors,

successors and assigns, any subsidiaries, any related companies, and the

employees, directors, officials, agents, officers, representatives and

attorneys of any of them, from all claims or demands EMPLOYEE or COMPANY may

have based on EMPLOYEE’S employment with COMPANY or the termination of that

employment.  This includes, but is not

limited to, a release of any rights or claims EMPLOYEE may have under the Age

Discrimination in Employment Act, which prohibits age discrimination in employment;

under Title VII of the Civil Rights Act of 1964; or under any other federal,

state or local laws or regulations prohibiting employment discrimination.  This also includes, but is not limited to, a

release by EMPLOYEE of any claims for breach of contract or wrongful discharge,

including but not limited to breach of any obligation contained in COMPANY’S

offer of employment to EMPLOYEE, which is superceded by and rendered null and

void by this Agreement.  Furthermore,

this includes a release by EMPLOYEE of any claims under any and all state workers

compensation  or unemployment

statutes.  This release covers both

claims that EMPLOYEE knows about and those he may not know about.  Notwithstanding the provisions of any state

laws or statutes, and for the purpose of implementing a full and complete

release, EMPLOYEE and COMPANY expressly acknowledge that this Agreement is

intended to include all claims which EMPLOYEE does not know or suspect to exist

in EMPLOYEE’S favor at the time of his signature on this Agreement, and that

this Agreement will extinguish any such claims.

 

This

release does not include, however, a release of EMPLOYEE’s rights, if any, to

pension, retiree, health or similar benefits under the COMPANY’s standard

retirement programs, to EMPLOYEE’s rights under the COMPANY’s stock option

plans, or to any claims arising after EMPLOYEE signs this Agreement.

 

FOURTH:                                                                                           No

Future Lawsuits.

 

EMPLOYEE

promises never to file a lawsuit or request arbitration asserting any claims

that are released in the Third Paragraph of this Agreement.  EMPLOYEE also promises never to file any

claims for workers compensation, unemployment benefits, or with any

administrative agencies or initiate a lawsuit or request arbitration asserting

any claims that are released in the Third Paragraph of this Agreement.

 

FIFTH:                                                                                                          Non-Release

of Future Claims.

 

This

Agreement does not waive or release any rights or claims that EMPLOYEE may have

under the Age Discrimination in Employment Act which arise after the date the

EMPLOYEE signs this Agreement.

 

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SIXTH:                                                                                                        Consequences

of EMPLOYEE’S Violation of Promises.

 

If a

party breaks its or his promise in the Fourth Paragraph of this Agreement and

files a lawsuit, request for arbitration or other claim or action based on

legal claims that the party has released, that party will pay for all costs

incurred by the other party, any related companies or the directors or

employees of any of them, including reasonable attorneys’ fees, in defending

against the claim.

 

SEVENTH:                                                                                      Confidentiality

and Cooperation.

 

EMPLOYEE

agrees to maintain strict confidentiality regarding the existence of and the

terms and conditions in this Agreement except to show this Agreement to his

personal attorney, personal accountant or any other personal adviser as required

for the sole purpose of obtaining advice with respect to the terms and

conditions hereof, provided that such person to whom disclosure is made agrees

to be bound by the confidentiality provisions hereof.

 

EMPLOYEE

agrees to reasonable cooperation with COMPANY in the defense or prosecution of

any litigation, arbitration, or claim against or by any person or party.  COMPANY agrees to pay EMPLOYEE’S reasonable,

documented, out-of-pocket  expenses in

providing any such cooperation pursuant to the terms of this Paragraph.  EMPLOYEE shall not, however, be paid for his

time or inconvenience in providing cooperation pursuant to the terms of this

Paragraph.

 

EIGHTH:                                                                                                Non-Competition,

Non-Solicitation and Confidential Information.

 

In

consideration for the receipt of salary continuation and all of the other

benefits set forth herein, the EMPLOYEE agrees that for a two year period

commencing on the date EMPLOYEE signs this Agreement, EMPLOYEE shall not (i)

directly or indirectly, except with the advance written approval, which shall

not unreasonably be withheld, of the President and Chief Executive Officer of

the COMPANY, engage or otherwise participate in any business which is

competitive with any significant line of business of the COMPANY (other than

through ownership of not more than 5% of the voting securities of any such

competitive business) or (ii) solicit or induce any employee of the COMPANY to

leave his or her employment with the COMPANY to accept employment or other

engagement with any such competitive business. 

In the event that EMPLOYEE breaches this undertaking, in addition to any

and all other remedies the COMPANY may have, the EMPLOYEE shall reimburse the

COMPANY for all monies paid to the EMPLOYEE by the COMPANY under this

Agreement, salary continuation payments shall immediately and permanently

cease, EMPLOYEE shall be laid off immediately and he forfeits his right to any

future payments or benefits set forth in this Agreement.

 

In

addition, EMPLOYEE acknowledges that, by virtue of his senior management

position with the COMPANY, EMPLOYEE has detailed and extensive current

knowledge of the COMPANY’s highly confidential and proprietary information,

including but not limited to competitive operating and strategic plans and

objectives, customer lists, cost structures and capabilities and that

disclosure of such information to

 

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the COMPANY’s

competitors would cause irreparable harm to the COMPANY.  EMPLOYEE agrees that he shall maintain such

information as strictly confidential for a period of two years commencing on

the date EMPLOYEE signs this Agreement.  

In the event that EMPLOYEE breaches this undertaking, in addition to any

and all other remedies the COMPANY may have, the EMPLOYEE shall reimburse the

COMPANY for all monies paid to the EMPLOYEE by the COMPANY under this

Agreement, salary continuation payments shall immediately and permanently

cease, EMPLOYEE shall be laid off immediately and EMPLOYEE forfeits his right

to any future payments or benefits set forth in this Agreement.

 

NINTH:                                                                                                      Period

for Review and Consideration of Agreement.

 

EMPLOYEE

understands that EMPLOYEE has been given a period of 21 days to review and

consider this Agreement before signing it. 

EMPLOYEE further understands that EMPLOYEE may use as much of this

21-day period as EMPLOYEE wishes prior to signing.

 

TENTH:                                                                                                    Non-Admission

of Liability.

 

By

making this Agreement, the COMPANY does not admit that it has done anything

wrong.

 

ELEVENTH:                                                                               Representation

by Counsel.

 

EMPLOYEE

was encouraged by COMPANY to consult with an attorney before signing this

Agreement.

 

TWELFTH:                                                                                  EMPLOYEE’S

Right to Revoke Agreement.

 

EMPLOYEE

may revoke this Agreement within seven (7) days of EMPLOYEE’S signing it.  Revocation can be made by delivering a written

notice of revocation to:

 

Gary R. Chadick

Senior Vice President,

General Counsel & Secretary

Rockwell Collins, Inc.

400 Collins Road NE

Cedar Rapids, IA 52498

 

For this

revocation to be effective, written notice must be received by Mr. Chadick no

later than the close of business on the seventh day after EMPLOYEE signs this

Agreement.  If EMPLOYEE revokes this

Agreement, it shall not be effective or enforceable and EMPLOYEE will not

receive the benefits described in this Agreement.

 

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THIRTEENTH:                                                                Arbitration.

 

Any

and all disputes regarding this Agreement will be resolved by binding

Arbitration pursuant to the “Mutual Agreement to Arbitrate Claims” between

EMPLOYEE and COMPANY, and such arbitration to take place at the American

Arbitration Association’s offices nearest to COMPANY’S Cedar Rapids, Iowa

Headquarters.

 

FOURTEENTH:                                                            In

the Event of a Change of Control.

 

EMPLOYEE

agrees and understands that after this Agreement becomes effective, the Change

of Control Agreement dated June 29, 2001 between EMPLOYEE and COMPANY becomes

null and void and EMPLOYEE will not be entitled to any benefits so described in

that Change of Control Agreement.

 

FIFTEENTH:                                                                           Parties

Affected.

 

This Agreement

shall be binding on the EMPLOYEE and his heirs, successors, and legal

representatives.  EMPLOYEE may not

assign this Agreement or any of his rights hereunder and may not delegate any

obligation hereunder.  This Agreement is

intended to benefit EMPLOYEE and COMPANY, including its subsidiaries,

affiliates, employees, directors, officers, agents, attorneys, successors, and

assigns thereof.

 

SIXTEENTH:                                                                         Equitable

Relief

 

It is

agreed that remedies for breach of the Eighth Paragraph of this Agreement shall

include equitable relief in addition to any other legal remedies available to

the COMPANY under the circumstances.

 

SEVENTEENTH:                                                       Governing

Law

 

This

Agreement is governed by the laws of the State of Iowa, without reference to

its conflict of laws provisions.

 

EIGHTEENTH:                                                                 Entire

Agreement/Modifications

 

This

is the entire agreement between EMPLOYEE and COMPANY regarding the subject

matter hereof.  The “Mutual Agreement to

Arbitrate Claims” agreement and EMPLOYEE’s October 15, 2001 stock option

agreement are specifically incorporated herein by reference and shall continue

to bind both parties.  COMPANY has made

no promises of any kind pertaining to the subject matter hereof to EMPLOYEE

other than those set forth in this Agreement. 

Any amendment, modification or change to this Agreement shall not be

binding unless in writing and duly executed by an authorized representative of

both parties.  This Agreement may be

executed in counterparts.

 

EMPLOYEE ACKNOWLEDGES THAT HE HAS

READ THIS AGREEMENT, UNDERSTANDS IT AND IS VOLUNTARILY ENTERING INTO IT.

 

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PLEASE  READ THIS

AGREEMENT CAREFULLY.  IT CONTAINS A

RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. 

THIS AGREEMENT WILL NOT TAKE EFFECT FOR SEVEN (7) DAYS AFTER EMPLOYEE

SIGNS IT.

 

IN

WITNESS THEREOF, the parties have caused this Agreement to be signed below on

the dates shown opposite their signatures. 

This Agreement is effective upon the execution of this Agreement by both

parties provided that prior to execution of this Agreement EMPLOYEE executes a

resignation letter in which EMPLOYEE resigns from all corporate officer

positions of the COMPANY.

 

	

  Dated:

  	

    July 16, 2002

  	

   

  	

  AN INDIVIDUAL

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

    /s/ Neal J. Keating

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  NEAL J. KEATING

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  Dated:

  	

    July 16, 2002

  	

   

  	

  ROCKWELL

  COLLINS, INC.

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

    /s/ William J. Richter

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  WILLIAM J.

  RICHTER,

  SENIOR VICE PRESIDENT,

  HUMAN RESOURCES

  

 

8Exhibit 10-s-1

 

 

July 9, 2002

 

 

Mr. Donald R.

Beall

Retired

Non-Executive Chairman of the Board

Rockwell Collins,

Inc.

5 Civic Plaza,

Suite 320

Newport Beach,

CA  92660-5956

 

Re:  Transition Agreement With Rockwell

Collins, Inc. (the “Corporation”)

 

Dear Don:

 

This letter

confirms the arrangements that have been recommended by the Compensation

Committee and agreed upon by the Board of Directors under which you will act as

a consultant to the Corporation for a transition period in connection with your

stepping down as Chairman of the Board. 

In effect, this agreement extends your role as a mentor and senior

consultant to the executive management team that the Board of Directors found

to be very beneficial during your service as Chairman of the Board.  You will make yourself available to the

Corporation, at mutually convenient times and places, for such consulting

services as may be requested by the undersigned or the Board of Directors of

this Corporation.

 

It is understood

that, separate from your duties as a continuing member of our Board of

Directors, your responsibilities as a consultant will require you to devote a

reasonable portion of your time to this work. 

You will not be otherwise restricted in your business activities so long

as they do not interfere with your reasonable availability to the

Corporation.  It is agreed, however,

that you will not engage in any activity which presents a conflict of interest

in light of your relationship with the Corporation.

 

You will be

treated as an independent contractor of the Corporation for purposes of this

consulting arrangement.  Without

limiting the generality of the foregoing, you shall not by reason of your

services to the Corporation under this agreement be eligible for participation

in or be entitled to benefits under any employee benefit plans or program

sponsored by the Corporation.

 

The Corporation

will pay you a fee for these consulting services at the rate of $150,000 per

year for the period July 1, 2002 to June 30, 2003 and at the rate of $50,000

per year for the period July 1, 2003 to June 30, 2004, payable quarterly in

advance during the period of this agreement. 

The Corporation will also reimburse you for reasonable travel expenses

and for out-of-pocket expenditures which you may incur in serving as a

consultant to the Corporation.

 

 

Page 2

 

 

If this correctly

sets forth our understanding, please sign the duplicate original of this letter

and return it to me.

 

Sincerely,

 

ROCKWELL COLLINS,

INC.

 

	

  /s/

  	

  Clayton M. Jones

  	

   

  
	

   

  
	

  Clayton M. Jones

  
	

  Chairman, President

  and Chief Executive Officer

  
	

   

  
	

   

  
	

  ACCEPTED:

  
	

   

  
	

   

  
	

  /s/

  	

  Donald R. Beall

  	

   

  
	

  Donald R. Beall

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