Document:

ex10-10

 

EXHIBIT 10.10

SEVERANCE PROTECTION AGREEMENT

            SEVERANCE PROTECTION AGREEMENT dated ___________, by and between General Dynamics
Corporation, a Delaware corporation (the “Company”), and ___________________
(the “Executive”).

            The Board of Directors of the Company (the “Board”) recognizes that the
possibility of a Change in Control (as hereinafter defined) of the Company
exists and that the threat or occurrence of a Change in Control may result in
the distraction of its key management personnel because of the uncertainties
inherent in such a situation.

            The Board has determined that it is essential and in the best interests of
the Company and its stockholders to retain the services of the Executive in the
event of the threat or occurrence of a Change in Control and to ensure the
Executive’s continued dedication and efforts in such event without undue
concern for the Executive’s personal financial and employment security.

            In order to induce the Executive to remain in the employ of the Company,
particularly in the event of the threat or occurrence of a Change in Control,
the Company desires to enter into this Agreement to provide the Executive with
certain benefits in the event the Executive’s employment is terminated as a
result of, or in connection with, a Change in Control.

            NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:

            Section 1. Definitions. For purposes of this Agreement, the following
terms have the meanings set forth below:

            “Accounting Firm” has the meaning set forth in Section 5.2.

            “Accrued Compensation” means an amount which includes all amounts earned
or accrued by the Executive through and including the Termination Date but not
paid to the Executive on or prior to such date, including (a) all base salary,
(b) reimbursement for all reasonable and necessary expenses incurred by the
Executive on behalf of the Company during the period ending on the Termination
Date, (c) all vacation pay and (d) all bonuses and incentive compensation
(other than the Pro Rata Bonus).

            “Base Amount” means the greater of the Executive’s annual base salary (a)
at the rate in effect on the Termination Date and (b) at the highest rate in
effect at any time during the 180-day period prior to a Change in Control, and
will include all amounts of the Executive’s base salary that are deferred under
any qualified or non-qualified employee benefit plan of the Company or any
other agreement or arrangement.

 

 

            “Beneficial Owner” has the meaning as used in Rule 13d-3 promulgated under
the Securities Exchange Act. The term “Beneficially Owned” has a correlative
meaning.

            “Board” means the Board of Directors of the Company.

            “Bonus Amount” means the current portion of the annual bonus awarded
pursuant to the incentive compensation plan, and paid or payable at the
conclusion of each fiscal year. The term excludes the equity incentive program
portion of the incentive compensation plan and the Pro Rata Bonus.

            “Cause” for the termination of the Executive’s employment with the Company
will be deemed to exist if the Executive has been convicted of a felony or if
the Board determines by a resolution adopted in good faith by at least
two-thirds of the Board that the Executive has (a) intentionally and
continually failed to perform in all material respects the Executive’s
reasonably assigned duties with the Company (other than a failure resulting
from the Executive’s incapacity due to physical or mental disability or illness
or from the Executive’s assignment of duties that would constitute Good Reason
for the Executive’s termination of employment with the Company) which failure
has continued for a period of at least 30 days after a written notice of demand
for performance has been delivered to the Executive specifying the manner in
which the Executive has failed in all material respects to so perform or (b)
intentionally engaged in conduct which is demonstrably and materially injurious
to the Company; provided that no termination of the Executive’s employment will
be for Cause as set forth in clause (b) hereof unless (i) there has been
delivered to the Executive a written notice specifying in reasonable detail the
conduct of the Executive of the type described in clause (b) and (ii) the
Executive has been provided an opportunity to be heard in person by the Board
(with the assistance of the Executive’s counsel if the Executive so desires).
No act, nor failure to act, on the Executive’s part will be considered
intentional unless the Executive has acted, or failed to act, with a lack of
good faith and with a lack of reasonable belief that the Executive’s action or
failure to act was in or not opposed to the best interests of the Company.

            “Change in Control” means any following events:

		
	 	        (a)       An acquisition (other than directly from the Company) of any
voting securities of the Company by any Person immediately after which
such Person is the Beneficial Owner of 40% or more of the combined voting
power of the Company’s then outstanding voting securities; provided that
in determining whether a Change in Control has occurred, voting
securities which are acquired by (i) an employee benefit plan (or a trust
forming a part thereof) maintained by the Company or any Subsidiary of
the Company, (ii) the Company or any Subsidiary of the Company or (iii)
any Person in connection with a Non-Control Transaction (as hereinafter
defined), will not constitute an acquisition which results in a Change in
Control.

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	 	(b)       Consummation by the Company of:

		
	 	(i)       a merger, consolidation or reorganization involving the Company,
unless:
	 
	 	        (A)       the stockholders of the Company, immediately before such
merger, consolidation or reorganization, will own, directly or
indirectly, immediately following such merger, consolidation or
reorganization, at least 50% of the combined voting power of the
outstanding voting securities of the corporation resulting from
such merger, consolidation or reorganization (the “Surviving
Corporation”) in substantially the same proportion as their
ownership of the voting securities of the Company immediately
before such merger, consolidation or reorganization;
	 
	 	        (B)       the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement providing for
such merger, consolidation or reorganization constitute at least
50% of the members of the board of directors of the Surviving
Corporation; and
	 
	 	        (C)       no Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan (or any trust forming a part
thereof) maintained by the Company, the Surviving Corporation, any
Subsidiary of the Surviving Corporation, or any Person who,
immediately prior to such merger, consolidation or reorganization,
was the Beneficial Owner of 20% or more of the then outstanding
voting securities of the Company) is the Beneficial Owner of 20% or
more of the combined voting power of the Surviving Corporation’s
then outstanding voting securities.
	 
	 	        (D)       a transaction described in clauses (A) through (C) above
is referred to herein as a ''Non-Control Transaction”;
	 
	 	(ii)     the complete liquidation or dissolution of the Company; or
	 
	 	(iii)    an agreement for sale or other disposition of all or
substantially all of the assets of the Company to any Person (other
than a transfer to a Subsidiary of the Company).

		
	 	        (c)       Notwithstanding the foregoing, a Change in Control will not be
deemed to occur solely because any Person (a “Subject Person”) acquires
Beneficial Ownership of more than the permitted amount of the outstanding
voting securities of the Company as a result of the acquisition of voting
securities by the Company which, by reducing the number of voting
securities outstanding, increases the proportional number of shares
Beneficially Owned by the Subject Person, provided that if a Change in
Control would occur (but for the operation of this sentence) as a result
of the acquisition of voting securities by the Company, and after such
share acquisition by the Company, the Subject Person becomes the
Beneficial Owner of any additional voting securities which increases

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	 	the percentage of the then outstanding voting securities Beneficially
Owned by the Subject Person, then a Change in Control will be deemed to
have occurred.

		
	 	        (d)       Notwithstanding anything contained in this Agreement to the
contrary, if the Executive’s employment with the Company is terminated
prior to a Change in Control and the Executive reasonably demonstrates
that such termination (i) was at the request of a Person who has
indicated an intention or taken steps reasonably calculated to effect a
Change in Control and who subsequently effects a Change in Control or
(ii) otherwise occurred in connection with, or in anticipation of, a
Change in Control which subsequently occurs, then for all purposes of
this Agreement, the date of such Change in Control with respect to the
Executive will mean the date immediately prior to the date of such
termination of the Executive’s employment.

            “Code” means the Internal Revenue Code of 1986, as amended.

            “Company” means General Dynamics Corporation, a Delaware corporation, and
includes its Successors.

            “Continuation Period” has the meaning set forth in Section 3.1(b)(iii).

            “Determination” has the meaning set forth in Section 5.2.

            “Disability” means a physical or mental disability or illness which
substantially impairs the Executive’s ability to perform the Executive’s
regular duties with the Company for a period of 180 consecutive days or for a
period of 270 days in any 365-day period.

            “Dispute” has the meaning set forth in Section 5.2.

            “Excess Payment” has the meaning set forth in Section 5.3.

            “Excise Tax” has the meaning set forth in Section 5.1.

            “Final Determination” has the meaning set forth in Section 5.3.

            “Good Reason” means the occurrence after a Change in Control of any of the
events or conditions described in clauses (a) through (h) hereof:

		
	 	        (a)       any (i) change in the Executive’s status, title, position or
responsibilities (including reporting responsibilities) which, in the
Executive’s reasonable judgment, represents an adverse change from the
Executive’s status, title, position or responsibilities as in effect at
any time within 180 days preceding the date of the Change in Control or
at any time thereafter, (ii) assignment to the Executive of duties or
responsibilities which, in the Executive’s reasonable judgment, are
inconsistent with the Executive’s status, title, position or
responsibilities as in effect at any time within 180 days preceding the
date of the Change in Control or at any time thereafter, or (iii) removal
of the Executive from or failure to reappoint or reelect the Executive to
any of such offices or positions, in each

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	 	case except in connection with the termination of the Executive’s
employment for Disability, Cause, as a result of the Executive’s death or
by the Executive other than for Good Reason;
	 
	 	        (b)       a reduction in the Executive’s base salary or any failure to
pay the Executive any compensation or benefits to which the Executive is
entitled within five days after the date when due;
	 
	 	        (c)       the imposition of a requirement that the Executive be based at
any place outside a 30-mile radius of ______, except for reasonably required
travel on Company business which is not materially greater in frequency
or duration than prior to the Change in Control;
	 
	 	        (d)       the failure by the Company to (i) continue in effect (without
reduction in benefit level or reward opportunities) any material
compensation or employee benefit plan in which the Executive was
participating at any time within 180 days preceding the date of the
Change in Control or at any time thereafter, unless such plan is replaced
with a plan that provides substantially equivalent compensation or
benefits to the Executive or (ii) provide the Executive with compensation
and benefits, in the aggregate, at least equal (in terms of benefit
levels and reward opportunities) to those provided for under each other
employee benefit plan, program and practice in which the Executive was
participating at any time within 1 80 days preceding the date of the
Change in Control or at any time thereafter;
	 
	 	        (e)       the insolvency or the filing (by any party, including the
Company) of a petition for bankruptcy with respect to the Company, which
petition is not dismissed within 60 days;
	 
	 	        (f)       any material breach by the Company of any provision of this
Agreement;
	 
	 	        (g)       any purported termination of the Executive’s employment for
Cause by the Company which does not comply with the terms of this
Agreement; or
	 
	 	        (h)       the failure of the Company to obtain, as contemplated in
Section 6, an agreement, reasonably satisfactory to the Executive, from
any Successor to assume and agree to perform this Agreement.

            Any event or condition described in clauses (a) through (h) which occurs
prior to a Change in Control but which the Executive reasonably demonstrates
(a) was at the request of a Person who has indicated the intention or takes
steps reasonably calculated to affect a Change in Control and who subsequently
effects a Change in Control or (b) otherwise arose in connection with, or in
anticipation of, a Change in Control which subsequently occurs, will constitute
Good Reason for purposes of this Agreement notwithstanding that it occurred
prior to the Change in Control.

            “Gross-Up Payment” has the meaning set forth in Section 5.1.

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            “Notice of Termination” means a written notice from the Company of the
termination of the Executive’s employment which indicates the specific
termination provision in this Agreement relied upon and which sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive’s employment under the provision so indicated.

            “Person” has the meaning as used in Section 13(d) or 14(d) of the
Securities Exchange Act, and will include any “group” as such term is used in
such sections.

            “Pro Rata Bonus” means an amount equal to the Bonus Amount multiplied by a
fraction, the numerator of which is the number of days elapsed in the then
fiscal year through and including the Termination Date and the denominator of
which is 365.

            “Securities Exchange Act” means the Securities Exchange Act of 1934, as
amended.

            “Subsidiary” means any corporation with respect to which another specified
corporation has the power under ordinary circumstances to vote or direct the
voting of sufficient securities to elect a majority of the directors.

            “Successor” means a corporation or other entity acquiring all or
substantially all the assets and business of the Company, whether by operation
of law, by assignment or otherwise.

            “Supplemental Retirement Benefit” will mean the lump sum actuarial
equivalent of the aggregate retirement benefit the Executive would have been
entitled to receive under the Company’s supplemental and other retirement plans
including the General Dynamics Corporation Retirement Plan for Salaried
Employees (the “Pension Plan”). For purposes of the foregoing, the “actuarial
equivalent” will be determined in accordance with the actuarial assumptions
used for the calculation of benefits under the Pension Plan as applied
immediately prior to the Termination Date in accordance with past practices.

            “Termination Date” means (a) in the case of the Executive’s death, the
Executive’s date of death, (b) in the case of the termination of the
Executive’s employment with the Company by the Executive for Good Reason, the
last day of the Executive’s employment, and (c) in all other cases, the date
specified in the Notice of Termination; provided that if the Executive’s
employment is terminated by the Company for Cause or due to Disability, the
date specified in the Notice of Termination will be at least 30 days after the
date the Notice of Termination is given to the Executive.

            “Underpayment” has the meaning set forth in Section 5.3.

            “Window Period” has the meaning set forth in Section 3.1(a).

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            Section 2. Term of Agreement. This Agreement will commence as of the
date hereof and will continue in effect until terminated by the Board of
Directors, provided, however, that the term of this Agreement will in any case
not expire prior to the expiration of 24 months after the occurrence of a
Change in Control.

            Section 3. Termination of Employment.

            If, during the term of this Agreement, the Executive’s employment with the
Company is terminated within 24 months following a Change in Control, the
Executive will be entitled to the following compensation and benefits:

		
	 	        (a)       If the Executive’s employment with the Company is terminated
(i) by the Company for Cause or Disability, (ii) by reason of the
Executive’s death or (iii) by the Executive other than for Good Reason
and other than during the 60-day period commencing on the first
anniversary of the date of the occurrence of a Change in Control (the
“Window Period”), the Company will pay to the Executive the Accrued
Compensation and, if such termination is other than by the Company for
Cause, a Pro Rata Bonus.
	 
	 	        (b)       If the Executive’s employment with the Company is terminated
for any reason other than as specified Section 3.1(a) or during the
Window Period, the Executive will be entitled to the following:

		
	 	        (i)       the Company will pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
	 
	 	        (ii)     the Company will pay the Executive as severance pay, and
in lieu of any further compensation for periods subsequent to the
Termination Date, in a single payment an amount in cash equal to        
         times the sum
of (A) the Base Amount and (B) the Bonus Amount;
	 
	 	        (iii)    for a period of 18 months (the “Continuation Period”),
the Company will at its expense continue on behalf of the Executive
and the Executive’s dependents and beneficiaries the life
insurance, disability, medical, dental and hospitalization benefits
provided (A) to the Executive at any time during the 180-day period
prior to the Change in Control or at any time thereafter or (B) to
other similarly situated executives who continue in the employ of
the Company during the Continuation Period. The coverage and
benefits (including deductibles and costs) provided in this Section
3.1(b)(iii) during the Continuation Period will be no less
favorable to the Executive and the Executive’s dependents and
beneficiaries than the most favorable of such coverages and
benefits during any of the periods referred to in clauses (A) and
(B) above. The Company’s obligation hereunder with respect to the
foregoing benefits will be limited to the extent that the Executive
obtains any such benefits pursuant to a subsequent employer’s
benefit plans, in which case the Company may reduce the coverage of
any benefits it is required to provide the Executive hereunder as
long as the coverages

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	 	and benefits of the combined benefit plans are no less favorable to
the Executive than the coverages and benefits required to be
provided hereunder. This Section 3.1(b) will not be interpreted so
as to limit any benefits to which the Executive or the Executive’s
dependents or beneficiaries may be entitled under any of the
Company’s employee benefit plans, programs or practices following
the Executive’s termination of employment, including retiree
medical and life insurance benefits;
	 
	 	        (iv)     the Company will pay in a single payment an amount in
cash equal to the excess of (A) the Supplemental Retirement Benefit
determined as if (1) the Executive had remained employed by the
Company for an additional         
        year(s) of credited service, (2) the
Executive’s annual compensation during such period had been equal
to the Executive’s Base Salary and the Bonus Amount, (3) the
Executive had been fully vested in the Executive’s benefit under
each retirement plan in which the Executive was a participant, (3)
the Company had made employer contributions to each defined
contribution plan in which the Executive was a participant at the
Termination Date in an amount equal to the amount of such
contribution for the plan year immediately preceding the
Termination Date and (4) the Executive had been fully vested in the
Executive’s benefit under each retirement plan in which the
Executive was a participant, over (B) the lump sum actuarial
equivalent of the aggregate retirement benefit the Executive is
actually entitled to receive under such retirement plans; and
	 
	 	        (v)       any restrictions on any outstanding restricted stock
awards granted to the Executive will lapse and such restricted
stock awards will become fully vested, all in-the-money stock
options will become fully vested, and the Executive will have the
right to require the Company to purchase, for cash, any
out-of-the-money stock options held by the Executive at a price
equal to the fair market value of such options on the date of
purchase determined by the Company using the Black-Scholes option
pricing model. For purposes of this Section 3.1(b)(v), a stock
option will be deemed (A) to be in-the-money if, as of the date of
determination, the New York Stock Exchange composite quotation for
the Company’s Common Stock, as reported in the Wall Street Journal,
as of the close of business, New York City time, on the immediately
preceding trading day (the “Applicable Price”), exceeds the
exercise price per share required to be paid by the holder upon the
exercise of such option and (B) to be out-of-the-money if, as of
the date of determination, the Applicable Price is equal to or less
than such exercise price.

		
	 	        (c)       The amounts provided for in Section 3.1(a) and Sections
3.1(b)(i), (ii) and (iv) will be paid in a single lump sum cash payment
by the Company to the Executive within five days after the Termination
Date.
	 
	 	        (d)       The Executive will not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise, and no such payment will be offset or reduced by the amount of
any compensation or benefits

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	 	provided to the Executive in any subsequent employment except as
specifically provided in Section 3.1(b)(iii).

            3.2.       The compensation to be paid to the Executive pursuant to Sections
3.1(a), 3.1 (b)(i) and 3.1 (b)(ii) of this Agreement will be in lieu of any
similar severance or termination compensation (i.e., compensation based
directly on the Executive’s annual salary or annual salary and bonus) to which
the Executive may be entitled under any other Company severance or termination
agreement, plan, program, policy, practice or arrangement. With respect to any
other compensation and benefit to be paid or provided to the Executive pursuant
to this Section 3, the Executive will have the right to receive such
compensation or benefit as herein provided or, if determined by the Company to
be more advantageous to the Executive, similar compensation or benefits to
which the Executive may be entitled under any other Company severance or
termination agreement, plan, program, policy, practice or arrangement. The
Executive’s entitlement to any compensation or benefits of a type not provided
in this Agreement will be determined in accordance with the Company’s employee
benefit plans and other applicable programs, policies and practices as in
effect from time to time.

            3.3       Notwithstanding any other provision of this Agreement to the contrary,
the termination of the Executive’s employment with the company in connection
with the sale, divestiture or other disposition of [applicable subsidiary] or
part thereof (the “Subsidiary”) will not be deemed to be a termination of
employment of the Executive for purposes of this Agreement provided the
Executive is offered employment by the purchaser or acquirer thereof and the
Company obtains an agreement from such purchaser or acquirer as contemplated in
Section 6, and the Executive will not be entitled to benefits from the Company
under this Agreement as a result of such sale, divestiture or other
disposition, or as a result of any subsequent termination of employment.

            Section 4. Notice of Termination. Following a Change in Control, any
purported termination of the Executive’s employment by the Company will be
communicated by a Notice of Termination to the Executive. For purposes of this
Agreement, no such purported termination will be effective without such Notice
of Termination.

            Section 5. Excise Tax Payments.

            5.1.       In the event that any payment or benefit (within the meaning of
Section 280G(b)(2) of the Code) to the Executive or for the Executive’s benefit
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise in connection with, or arising out of, the Executive’s
employment with the Company or a change in ownership or effective control of
the Company or of a substantial portion of its assets (a “Payment”), would be
subject to the excise tax imposed by Section 4999 of the Code, or any interest
or penalties are incurred by the Executive with respect to such excise tax
(such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to herein as the “Excise Tax”), then the
Executive will be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes and the
Excise Tax, other than interest and penalties imposed by reason of the
Executive’s failure to file timely a tax return or pay taxes shown due on the

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Executive’s return, and including any Excise Tax imposed upon the Gross-Up
Payment), the Executive retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments.

            5.2.       An initial determination as to whether a Gross-Up Payment is
required pursuant to this Agreement and the amount of such Gross-Up Payment
will be made at the Company’s expense by an accounting firm of recognized
national standing selected by the Company and reasonably acceptable to the
Executive (the “Accounting Firm”). The Accounting Firm will provide its
determination (the “Determination”), together with detailed supporting
calculations and documentation, to the Company and the Executive within five
days of the Termination Date, if applicable, or such other time as requested by
the Company or by the Executive (provided the Executive reasonably believes
that any of the Payments may be subject to the Excise Tax). If the Accounting
Firm determines that no Excise Tax is payable by the Executive with respect to
a Payment or Payments, it will furnish the Executive with an opinion reasonably
acceptable to the Executive that no Excise Tax will be imposed with respect to
any such Payment or Payments. Within ten days of the delivery of the
Determination to the Executive, the Executive will have the right to dispute
the Determination (the “Dispute”). The Gross-Up Payment, if any, as determined
pursuant to this Section 5.2 will be paid by the Company to the Executive
within five days of the receipt of the Determination. The existence of the
Dispute will not in any way affect the Executive’s right to receive the
Gross-Up Payment in accordance with the Determination. If there is no Dispute,
the Determination will be binding, final and conclusive upon the Company and
the Executive, subject to the application of Section 5.3.

            5.3.       As a result of uncertainty in the application of Sections 280G and
4999 of the Code, it is possible that a Gross-Up Payment (or a portion thereof)
will be paid which should not be paid (an “Excess Payment”) or that a Gross-Up
Payment (or a portion thereof) which should be paid will not be paid (an
“Underpayment”). An Underpayment will be deemed to have occurred (a) upon
notice (formal or informal) to the Executive from any governmental taxing
authority that the Executive’s tax liability (whether in respect of the
Executive’s current taxable year or in respect of any prior taxable year) may
be increased by reason of the imposition of the Excise Tax on a Payment or
Payments with respect to which the Company has failed to make a sufficient
Gross-Up Payment, (b) upon a determination by a court, (c) by reason of a
determination by the Company (which will include the position taken by the
Company, together with its consolidated group, on its federal income tax
return) or (d) upon the resolution of the Dispute to the Executive’s
satisfaction. If an Underpayment occurs, the Executive will promptly notify
the Company and the Company will promptly, but in any event at least five days
prior to the date on which the applicable government taxing authority has
requested payment, pay to the Executive an additional Gross-Up Payment equal to
the amount of the Underpayment plus any interest and penalties (other than
interest and penalties imposed by reason of the Executive’s failure to file
timely a tax return or pay taxes shown due on the Executive’s return) imposed
on the Underpayment. An Excess Payment will deemed to have occurred upon a
Final Determination (as hereinafter defined) that the Excise Tax will not be
imposed upon a Payment or Payments (or portion thereof) with respect to which
the Executive had previously received a Gross-Up Payment. A “Final
Determination” will be deemed to have occurred when the Executive has received
from the applicable government taxing authority a refund of taxes or

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other reduction in the Executive’s tax liability by reason of the Excise
Payment and upon either (i) the date a determination is made by, or an
agreement is entered into with, the applicable governmental taxing authority
which finally and conclusively binds the Executive and such taxing authority,
or in the event that a claim is brought before a court of competent
jurisdiction, the date upon which a final determination has been made by such
court and either all appeals have been taken and finally resolved or the time
for all appeals has expired or (ii) the statute of limitations with respect to
the Executive’s applicable tax return has expired. If an Excess Payment is
determined to have been made, the amount of the Excess Payment will be treated
as a loan by the Company to the Executive and the Executive will pay to the
Company on demand (but not less than 10 days after the determination of such
Excess Payment and written notice has been delivered to the Executive) the
amount of the Excess Payment plus interest at an annual rate equal to the
Applicable Federal Rate provided for in Section 1274(d) of the Code from the
date the Gross-Up Payment (to which the Excess Payment relates) was paid to the
Executive until the date of repayment to the Company. The Executive will use
reasonable cooperative efforts at the request of the Company to assist in the
determination of the amount of any Excess Payment or Underpayment made to the
Executive pursuant to this Agreement.

            5.4.       Notwithstanding anything contained in this Agreement to the
contrary, in the event that, according to the Determination, an Excise Tax is
imposed on any Payment or Payments, the Company will pay to the applicable
government taxing authorities as Excise Tax withholding the amount of the
Excise Tax that the Company has actually withheld from the Payment or Payments.

            Section 6. Successors: Binding Agreement. This Agreement will be
binding upon and will inure to the benefit of the Company and its Successors,
and the Company will require any Successors to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession or assignment had
taken place. Neither this Agreement nor any right or interest hereunder will
be assignable or transferable by the Executive or by the Executive’s
beneficiaries or legal representatives, except by will or by the laws of
descent and distribution. This Agreement will inure to the benefit of and be
enforceable by the Executive’s legal representatives.

            Section 7. Fees and Expenses. The Company will pay as they become due all
legal fees and related expenses (including the costs of experts) incurred by
the Executive as a result of (a) the Executive’s termination of employment
(including all such fees and expenses, if any, incurred in contesting or
disputing any such termination of employment) and (b) the Executive seeking to
obtain or enforce any right or benefit provided by this Agreement (including
any such fees and expenses incurred in connection with (i) the Dispute and (ii)
the Gross-Up Payment, whether as a result of any applicable government taxing
authority proceeding, audit or otherwise) or by any other plan or arrangement
maintained by the Company under which the Executive is or may be entitled to
receive benefits.

            Section 8. Notice. For the purposes of this Agreement, notices and all
other communications provided for in the Agreement (including the Notice of
Termination) will be in writing and will be deemed to have been duly given when
personally delivered or sent by

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certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company will be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications will be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
will be effective only upon receipt.

            Section 9. Nonexclusivity of Rights. Nothing in this Agreement will
prevent or limit the Executive’s continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by the Company for
which the Executive may qualify, nor will anything herein limit or reduce such
rights as the Executive may have under any other agreements with the Company
(except for any severance or termination agreement). Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any plan
or program of the Company will be payable in accordance with such plan or
program, except as specifically modified by this Agreement.

            Section 10. No Set-Off. The Company’s obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder will not be affected by any circumstances, including any right of
set-off, counterclaim, recoupment, defense or other right which the Company may
have against the Executive or others.

            Section 11. Miscellaneous. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by the Executive and the Company. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party will be deemed a waiver of similar or dissimilar provisions
or conditions at the same or at any prior or subsequent time. No agreement or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly
set forth in this Agreement.

            Section 12. Governing Law. This Agreement will be governed by and
construed and enforced in accordance with the laws of the State of Delaware
without giving effect to the conflict of laws principles thereof. Any action
brought by any party to this Agreement will be brought and maintained in a
court of competent jurisdiction in New Castle County in the State of Delaware.

            Section 13. Severability. The provisions of this Agreement will be
deemed severable and the invalidity or unenforceability of any provision will
not affect the validity or enforceability of the other provisions hereof.

            Section 14. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto and supersedes all prior agreements, if
any, understandings and arrangements, oral or written, between the parties
hereto with respect to severance protection in connection with a Change of
Control.”

-12-

 

            IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first above written.

	 	GENERAL DYNAMICS CORPORATION

	 	By: _________________________________

       Name:

       Title:

	 	By: _________________________________

       [Executive]

-13-ex10-11

 

EXHIBIT 10.11

	 	W.P. Wylie

Vice President

Human Resources and Administration

February 13, 2001

Mr. Kenneth C. Dahlberg:

Dear Mr. Dahlberg

On behalf of General Dynamics Corporation, we are pleased to extend an offer to
you for the position of Executive Vice President — Information Systems and Technology. In
this position you will be an officer of the Corporation and will report to
Nicholas D. Chabraja, Chairman and Chief Executive Officer. Please understand
that your election to officer status is subject to approval by the Board of
Directors. Your starting salary will be paid bi-weekly at a rate equivalent to
$450,000 annually.

You will be eligible to participate in the Corporation’s Incentive Compensation
and Long-Term Incentive Programs. Annual awards for Incentive Compensation are
dependent upon your performance as well as the corporation’s performance. The
Long-Term Incentive Program (LTIP) provides annual awards of stock options and
performance-restricted stock. The present value of your long-term award will be
approximately $1,100,000. Part of this award is in the form of options and part
in the form of performance restricted stock. Please note that all long-term
equity awards are subject to approval by the Compensation Committee of the
Board of Directors. The value of your total direct compensation (salary, bonus,
and long-term equity) is about $2,000,000. Tommy Augustsson (703-876-3473) will
discuss the details of this program at your convenience.

In addition, you will be granted restricted shares of General Dynamics stock
which will serve to offset the forfeiture of your non-vested Raytheon stock
options. The grant value will be the average of the high and low on your first
day of work and restrictions will lapse according to the original vesting
schedule. Also, you will be granted restricted shares of General Dynamics stock
to offset forfeitures of Raytheon shares. These shares will have a two year
restriction period.

Using the February 12, 2001 closing prices of Raytheon (RTNb - $33.30) and
General Dynamics (GD - $66.41) as an illustration, the resulting awards would be
a grant of 40,293 shares of restricted stock. (See Enclosure for details of the
calculations of this example.)

3190 Fairview Park Drive

Falls Church, VA 22042-4523

Tel 703 876 3415

Fax 703 876 3550

pwylie@generaldynamics.com

General Dynamics Private Information

 

 

Page 2

February 13, 2001

In the event you are involuntarily terminated, other than for cause,
during the first three years of your employment, your salary and benefits
would continue through that period.

This offer of employment is contingent upon filling out the application
form previously transmitted to you as well as successful completion of a
pre-employment drug screening.

Also, a presumptive condition for employment is that your bonus for
performance year 2000 is paid by your current employer and that the
non-vested options and restricted shares indeed are forfeited.

As a corporate officer, you will be offered the Corporate Office benefits
programs (i.e., health insurance, disability insurance, etc.). Henry
Eickelberg (703-876-3409) and Bob Stewart (703-876-3408) will enroll you
in these programs upon your first day of work. The perquisite program for
corporate officers has previously been transmitted to you. If you have
any questions, please call me.

Please acknowledge your acceptance or rejection of this offer by
completing the Acceptance/Rejection enclosure and returning it to me by 2
March 2001. If you accept the offer, please complete and return the
application form also.

We at General Dynamics are looking forward to a positive response from
you.

Sincerely,

/s/ T.R. Augustsson

for W.P. Wylie

Enclosures

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