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EXHIBIT 10-18A
XXXXX X. XXXXXX
EMPLOYMENT AGREEMENT
Agreement dated as of 3 October 1995 between General Dynamics Corporation, a
Delaware corporation (the "Corporation"), and Xx. Xxxxx X. Xxxxxx.
The Board of Directors of the Corporation has approved the continued employment
of Xx. Xxxxxx as Chairman and Chief Executive Officer of the Corporation for an
additional year. Accordingly, all terms and conditions of his Employment
Agreement dated 17 March 1993 shall be extended until 31 December 1996 except
as follows:
(1) The Retirement Benefit Agreement dated 3 October 1995,
attached as an Addendum to this Agreement, shall provide Xx. Xxxxxx
an annual supplemental retirement benefit equal to $58,272 at
retirement which represents the actuarial equivalent value of the
excess of the benefit that Xx. Xxxxxx would have been entitled to
receive at 1 January 1997 under the General Dynamics Corporation
Retirement Program (as defined in the Addendum) over the value of the
retirement benefit that was relinquished during 1994 in the
determination of the amount of life insurance under the Split-Dollar
Insurance Agreement with the Corporation.
In addition, at retirement, Xx. Xxxxxx will be entitled to receive a
cash payment of $84,821.33 which represents the difference in the
value of Xx. Xxxxxx'x account in the General Dynamics Corporation
Supplemental SSIP (the "Supplemental SSIP") at 31 December 1994 over
the value of the Supplemental SSIP that was relinquished during 1994
in the determination of the amount of life insurance under the
Split-Dollar Insurance Agreement with the Corporation.
Xx. Xxxxxx agrees that he will have no further interest in the General
Dynamics Corporation Supplemental Retirement Plan or in the General
Dynamics Corporation Supplemental SSIP.
(2) The remaining balance of $3,100,000 from Xx. Xxxxxx'x
Employment Agreement dated 17 March 1993, scheduled for payment on 31
December 1995, will be disbursed on 1 January 1997, or such earlier
date which is not later than 10 days following the date of his death
or on which he becomes incapacitated or otherwise physically unable to
continue rendering services to the Corporation. The balance of
$3,100,000 will be
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credited with interest beginning on 1 January 1996 and ending on the
date of payment. Interest will accrue monthly at an annual rate equal
to the rate used for the Special Distribution accounts in the General
Dynamics Incentive Compensation Plan ("the Plan").
(3) Xx. Xxxxxx agrees to be available to render consulting
services to the Corporation for a period of 12 months commencing on
his retirement date. In consideration for these services, the
Corporation will allow Xx. Xxxxxx to retain all of his Performance
Restricted Stock, which will then be subject to all of the terms and
conditions under which they were granted.
This Agreement shall inure to the benefit of, and be binding upon, the
Corporation and its successors and assigns and upon Xx. Xxxxxx and his heirs,
executors, and administrators.
This Agreement shall be construed and enforced in accordance with the laws of
the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed as
of the date first above written on its behalf by the Corporate Vice President,
Human Resources and Administration, and its Corporate seal to be hereunto
affixed and attested to by its Secretary, each of whom has been thereunto duly
authorized, and Xx. Xxxxxx has signed this Agreement.
GENERAL DYNAMICS CORPORATION
By /s/ XXXXXXX X. XXXXX
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ATTEST:
/s/ E. XXXX XXXXXXX
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Secretary
/s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx
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ADDENDUM
RETIREMENT BENEFIT AGREEMENT
ADDENDUM TO AGREEMENT dated as of 3 October 1995 between General Dynamics
Corporation, a Delaware corporation (the "Corporation"), and Xxxxx X. Xxxxxx
(the "Employee").
WHEREAS, the Employee has accrued retirement benefits which will be payable to
him from the General Dynamics Retirement Plan for Salaried Employees (the
"Retirement Plan") and the Employee had rights under a supplemental
nonqualified retirement plan to the extent the accrued benefits under the
Retirement Plan were limited by Section 415, 401(a)(4) or 401(a)(17) of the
Internal Revenue Code (or similar provision), any benefit that would have been
provided by the benefit formula of the Retirement Plan in excess of those
limitations would have been provided under a nonqualified plan (Supplemental
Retirement Plan). The Retirement Plan and the Supplemental Retirement Plan are
hereinafter collectively referred to as the Retirement Program.
WHEREAS, the Employee entered into a split dollar insurance agreement with the
Corporation in November 1994 and as part of that agreement relinquished his
interest in the retirement benefits under his Employment Agreement dated 17
March 1993, his balance in the General Dynamics Corporation Supplemental
Retirement Plan and his balance in the General Dynamics Corporation
Supplemental SSIP;
WHEREAS, as a result of the Agreement dated 3 October 1995 between the
Corporation and the Employee, the Employee shall continue his employment as
Chairman and Chief Executive Officer of the Corporation for an additional year;
NOW, THEREFORE, in consideration for the Employee's past employment by the
Corporation and the Employee's future services, the Corporation and the
Employee agree as follows:
1. MEMBERSHIP IN GENERAL DYNAMICS RETIREMENT PLAN. The Employee will
continue to be a member of the General Dynamics Retirement Plan for
Salaried Employees (the "Retirement Plan").
2. RETIREMENT BENEFIT. Upon the Employee's retirement from the
Corporation, the Employee shall be entitled to such annual retirement
benefits, if any, as of the date of the Employee's termination of
employment with the Corporation, based upon the terms of the
Retirement Plan. Payment of these benefits shall commence at such
time and in the form the Employee elects pursuant to the terms of the
Retirement Plan.
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3. SUPPLEMENTAL RETIREMENT BENEFIT.
(a) Upon the termination of the Employee's employment with the
Corporation, the Employee shall also be paid by the
Corporation an additional annual retirement benefit in an
amount equal to $58,272. This amount shall be payable in
monthly installments commencing January 1, 1997 and continue
during his remaining lifetime.
(b) The benefit in paragraph (a) represents the actuarial
equivalent value of the excess of the benefit that the
Employee would have been entitled to receive at January 1,
1997 under the Retirement Program over the value of the
retirement benefit that was relinquished during 1994 in the
determination of the amount of life insurance under the
Split-Dollar Insurance Agreement with the Corporation.
Actuarial equivalence for this purpose is based on the 1984
Unisex Pension Mortality Table set back one year with interest
at the rate of 7% per annum compound.
(c) The benefit provided by paragraph (a) of this section will not
be provided to the Employee if the Employee causes harm to the
Corporation (financial, reputation, or product), through: (i)
an act or acts of personal dishonesty, (ii) conviction of a
felony related to the Corporation, (iii) material violation of
General Dynamics' standards of business ethics and conduct,
(iv) individually filing or participating in a lawsuit
against the Corporation, or (v) subsequent employment with a
competitor.
4. ALTERNATE FORM OF BENEFIT. The Employee shall have the option, on
written notice transmitted to the Corporation at least 30 days prior
to the date on which payment of his benefit would otherwise commence
hereunder, to elect to receive the retirement benefit described herein
payable in an alternate form as provided by the Retirement Plan or, in
the Corporation's discretion, in another form of actuarial equivalent
value. The applicable single life annual benefit shall then be
converted to the alternate form elected by the application of the
actuarial factors used for converting benefits under the Retirement
Plan at the time the retirement benefit is to commence.
5. SURVIVOR BENEFIT IN CASE OF DEATH PRIOR TO COMMENCEMENT OF BENEFITS.
If the Employee dies on or after January 1, 1996, but prior to
commencement of benefits, his spouse shall be entitled to receive
payment of the Supplement (as calculated in paragraph 3(a)) as a
pre-retirement surviving spouse annuity as defined in the Retirement
Plan (currently defined at a 50% Contingent Annuity) for her life,
commencing on the Employee's death. The amount of the benefit shall
be calculated by the application of the actuarial factors used by the
Retirement Plan for calculating the surviving spouse annuity as of the
date of the Employee's death. The Employee's Spouse shall also be
entitled to payment of such retirement benefits (as defined in
paragraph 2), if any, as provided under the terms of the Retirement
Program.
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6. PAYMENT. All annual retirement benefits for the life of the Employee
(or alternate form of benefit) or other amounts payable as provided in
this Agreement shall be paid as provided in the Employee's benefit
election under the Retirement Plan. Any retirement benefits to which
the Employee is entitled under this Agreement shall be paid directly
by the Corporation to the extent they are not paid under the
Retirement Plan. The Corporation may, in its sole discretion,
accelerate the payment of benefits under this Agreement in a form of
actuarial equivalent value.
7. NO ASSIGNMENT. No benefit under this Agreement shall be subject in
any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge, and any attempt so to anticipate,
alienate, sell, transfer, assign, pledge, encumber or change the same
shall be void, and no such benefit shall in any manner be liable for
or subject to the debts, liabilities, engagements or torts of the
person entitled to such benefit, except as specifically provided in
the Retirement Program or pursuant to a Qualified Domestic Relations
Order and described in Code Section 414(p).
8. PAYMENT FROM GENERAL ASSETS.
(a) Unless otherwise determined by the Corporation, the Supplement
will be payable by the Corporation from its general assets.
The Corporation shall not be obliged to acquire, designate or
set aside any specific assets for payment of the Supplement.
Further, the Employee shall have no claim whatsoever to any
specific assets or group of assets of the Corporation.
(b) The Corporation may, in its discretion, designate that the
Supplement shall be satisfied from the assets of a trust,
fund, or other segregated group of assets. But, should these
assets prove to be insufficient to satisfy payment of the
Supplement or post-retirement benefits described above, the
Corporation shall remain liable for their payment unless
otherwise agreed to by the parties of this Agreement.
9. EFFECT ON OTHER AGREEMENTS. This Retirement Benefit Agreement shall
supersede any prior Retirement Benefit Agreements and any such prior
Agreements shall be null and void.
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IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed on
behalf of its Chairman and Chief Executive Officer by the Corporate Vice
President - Human Resources and Administration and its corporate seal to be
hereunto affixed and attested to by the Secretary of the Corporation, and the
Employee has executed this Agreement as of the date first above written.
ATTEST: GENERAL DYNAMICS CORPORATION
/s/ E. XXXX XXXXXXX By: /s/ XXXXXXX X. XXXXX
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Secretary Xxxxxxx X. Xxxxx
Corporate Vice President - Human
Resources and Administration
/s/ XXXXXXXX X. HOUSE /s/ XXXXX X. XXXXXX
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Witness Employee
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