Exhibit 10.5
RESTRICTED STOCK UNIT AWARD
AGREEMENT
PURSUANT TO THE GENERAL DYNAMICS
CORPORATION
2009 EQUITY COMPENSATION
PLAN
This Restricted Stock Unit Award
Agreement (the “Agreement”) is entered into as of [
], (the “Grant Date”), by and between General Dynamics
Corporation (the “Company”) and [
] (the “Grantee”).
WHEREAS, the Company sponsors the
General Dynamics Corporation 2009 Equity Compensation Plan (the
“Plan”), pursuant to which the Company may grant
Restricted Stock Units (“RSUs”); and
WHEREAS, the Company desires to
grant the Grantee an award of RSUs.
NOW, THEREFORE, in consideration of
the recitals and the mutual agreements herein contained, the
parties hereto agree as follows:
1. Number of RSUs . The
Grantee is hereby granted RSUs over
shares of Common Stock, subject to the restrictions set forth
herein. Each RSU represents an unfunded, unsecured promise by the
Company to deliver one share of the Company’s common stock
(“Common Stock”), subject to certain restrictions and
the terms and conditions contained in this Agreement.
2. Nature and Settlement of
Award . Settlement of the RSUs shall occur as soon as
practicable after the Vesting Date (as provided in
Section 3(b) below), but in any event, for Grantees who are
U.S. taxpayers, within the period ending on the 15th day of the
third month following the Vesting Date (defined below).
3. Terms of RSUs . The grant
of RSUs provided in Section 1 hereof will be subject to the
following terms, conditions and restrictions:
(a) No Shareholder Rights .
The grant of RSUs does not entitle Grantee to any rights of a
shareholder of Common Stock, including dividends or voting
rights.
(b) Vesting Date . Except as
may otherwise be provided herein, RSUs will vest on the first day
of January on which the New York Stock Exchange is open for
business of the fourth calendar year following the calendar year in
which the Grant Date occurs (the “Vesting Date”)
provided that the Grantee is employed by the Company or is serving
as a director of the Company on such date or dies prior to such
date while employed by the Company or serving as a director of the
Company. Upon the vesting of the RSUs, the Company, in its sole
discretion, may either issue to the Grantee or the Grantee’s
personal representative a stock certificate representing, or
deposit in such Grantee’s or the Grantee’s personal
representative’s brokerage account via electronic transfer,
one share of Common Stock for each RSU that has vested.
(c) Dividend Equivalents . If
the Company decides to pay dividend equivalents on the RSUs, such
dividend equivalents will accrue and be notionally credited to the
Grantee’s RSU account and paid out in the form of additional
shares on the date that the RSUs are settled in
accordance with Section 2 and will in no
circumstances be settled in cash; no dividend equivalents will be
paid out prior to the Vesting Date. In no event shall fractional
shares be issued; the Company will round down to the nearest share
in settling any accrued dividend equivalents.
(d) Transfer Restrictions .
Neither the RSUs nor any interest thereto may be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of by the
Grantee, except by will or the laws of descent and distribution,
and any such purported sale, assignment, transfer, pledge,
hypothecation or other disposition shall be void and unenforceable
against the Company.
(e) Incorporation of Plan by
Reference, Etc. The provisions of the Plan are hereby
incorporated herein by reference. Except as otherwise expressly set
forth herein, this Agreement will be construed in accordance with
the provisions of the Plan and any capitalized terms not otherwise
defined in this Agreement will have the definitions set forth in
the Plan. The Committee will have final authority to interpret and
construe the Plan and this Agreement and to make any and all
determinations under them, and its decisions will be binding and
conclusive upon the Grantee and the Grantee’s legal
representative in respect of any questions arising under the Plan
or this Agreement. If there exists any inconsistency between the
terms of this Agreement and the Plan, the terms contained in the
Plan will govern. If there exists any inconsistency between the
terms of the RSUs as provided for herein (including terms relating
to the number of shares of RSUs or the Vesting Date) and the terms
as indicated in the records maintained by Company, the terms as
indicated in the records of the Company will govern.
4. Termination of Employment or
Service as a Director .
(a) General . In the event
that (i) the Grantee ceases to be employed by the Company or
ceases to be a director of the Company for any reason (other than
due to death, total and permanent disability, Retirement (as
defined below), divestiture or discontinued operation of a
Subsidiary or division with which the Grantee was associated, or
lay-off), prior to the Vesting Date or (ii) the Grantee ceases
to be employed by the Company on account of lay-off prior to
December 31st of the calendar year following the calendar year
in which the Grant Date occurs (the “Determination
Date”), the RSUs will be automatically forfeited by the
Grantee on the date of such termination. For purposes of this
Agreement, in the event of involuntary termination of the
Grantee’s employment (whether or not in breach of local labor
laws), the Grantee’s right to receive RSUs and vest under the
Plan, if any, will terminate effective as of the date that the
Grantee is no longer actively employed and will not be extended by
any notice period mandated under local law ( e.g. , active
employment would not include a period of “garden leave”
or similar period pursuant to local law); furthermore, in the event
of involuntary termination of employment (whether or not in breach
of local labor laws), the Grantee’s right to receive shares
pursuant to the RSUs after termination of employment, if any, will
be measured by the date of termination of the Grantee’s
active employment and will not be extended by any notice period
mandated under local law; the Committee shall have the exclusive
discretion to determine when the Grantee is no longer actively
employed for purposes of the Award. For purposes of this Agreement,
“Retirement” means, (A) with respect to an
employee who is not an elected officer of the Company on the date
on which the employee’s employment with the Company
terminates, the termination of employment after the attainment of
age 55 with at least five (5) or more years of continuous
service and (B) with respect to an employee who is an elected
officer of the Company on the date on which the
employee’s
2
employment with the Company terminates,
termination of employment after attaining age 55 with the consent
of the Chief Executive Officer of the Company.
(b) Certain Terminations . In
the event that the Grantee ceases to be employed by the Company or
ceases to be a director of the Company due to total and permanent
disability, Retirement, divestiture or discontinued operation of a
Subsidiary or division with which the Grantee was associated, prior
to the Determination Date, then the RSUs will vest on the date of
such cessation with respect to a number of RSUs equal to product of
(i) the total number of RSUs granted hereunder (including any
dividend equivalents that have been credited to the Grantee’s
notional account as of the date of termination of employment) and
(ii) a fraction, the numerator of which will be the number of
days from January 1 of the year in which the Grant Date occurs
to the last day of the month in which such termination occurs and
the denominator of which will be 730, such product to be rounded
down to the nearest whole share (the “Pro Rated RSUs”),
and the remaining RSUs will be automatically forfeited by the
Grantee as of the date of such termination. In the event that the
Grantee ceases to be employed by the Company or ceases to serve as
a director of the Company due to total and permanent disability,
Retirement, divestiture or discontinued operation of a Subsidiary
or division with which the Grantee was associated, or lay-off, in
each case, on or after the Determination Date, then RSUs will vest
in full on the date of such cessation. Notwithstanding the
foregoing, all of the RSUs will be automatically forfeited by the
Grantee if the Grantee causes “Harm” (as defined below)
to the Company prior to the Vesting Date. For purposes of this
Agreement, “Harm” includes, any actions that adversely
affect the Company’s financial standing, reputation, or
products, or any actions involving personal dishonesty, a felony
conviction related to the Company, or any material violation of any
confidentiality or non-competition agreement with the
Company.
(c) Change in Control .
Notw
