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Exhibit 10.3
EXECUTIVE RETENTION
AGREEMENT
This Executive Retention Agreement
(“the Agreement”) is made by and between General
Dynamics Corporation (“the Corporation”) and
Mr. Walter M. Oliver (“Executive”) (together
“the Parties”) this 7th day of June, 2007 (“the
Effective Date”).
Recitals
WHEREAS, Executive is currently an
Officer of the Corporation and its Senior Vice President for Human
Resources and Administration;
WHEREAS, the Board of Directors of the
Corporation understands that Executive is considering retirement
during 2009 and anticipates that the individuals holding the
positions of Chief Executive Officer and General Counsel of the
Corporation also may retire in or about 2009;
WHEREAS, the Board of Directors of the
Corporation desires to facilitate an orderly transition of
responsibilities for the positions being vacated by the retiring
senior executives;
WHEREAS, Executive has previously signed
certain Incentive Stock Option Agreements, Non-Statutory Stock
Option Agreements, and Restricted Stock Agreements (“the
Equity Agreements”) pursuant to the General Dynamics Equity
Compensation Plan (“the EC Plan”) which provide for
forfeiture and pro-ration of prior equity grants upon retirement;
and
WHEREAS, the Board of Directors of the
Corporation desires for Executive to remain in his current position
until December 31, 2009.
Terms
NOW, THEREFORE, the Parties agree as
follows:
1. Retention Period .
The Retention Period begins on the Effective Date and ends on
December 31, 2009, at which time the employment relationship
between Executive and the Corporation will terminate and Executive
will retire. Executive will tender his resignation as an Officer of
the Corporation effective as of the earlier of the last active date
of his employment or the end of the Retention Period.
2. Retention Incentive
. Upon Executive’s satisfaction of the eligibility
requirements set forth in Paragraph 3 below at the conclusion of
the Retention Period, the Corporation agrees:
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(a) |
to pay Executive a bonus in respect of the 2009 calendar year
in an amount not less than the bonus paid to Executive in respect
of 2008, at the time 2009 bonuses are paid to other executives of
the Corporation, but in no event later than March 15,
2010; |
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(b) |
notwithstanding any other provision of the EC Plan or the
Equity Agreements, to treat Executive’s termination from
employment on or after December 31, 2009 as a retirement with
the consent of the Chief
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Executive Officer for
purposes of the EC Plan and the Equity Agreements; and
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(c) |
notwithstanding any other provision of the EC Plan or the
Equity Agreements, to cause any equity award Executive received
from the Corporation that has not yet vested to vest in full,
without pro-ration. |
3. Eligibility
Requirements . To be eligible for the Retention Incentive,
Executive must, except as provided in Paragraphs 4 and 5 below,
remain continuously and actively employed in his current position
from the Effective Date through the end of the Retention Period.
Executive will be ineligible for the Retention Incentive if he is
terminated for Cause or voluntarily resigns prior to the end of the
Retention Period.
4. Termination without
Cause . If Executive’s employment with the Corporation is
terminated without Cause before December 31, 20
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