EMPLOYMENT AND POST-RETIREMENT CONSULTING AGREEMENT
This agreement is
entered into on December
20, 1996 by and between General Electric Company, a New York corporation,
and John F. Welch, Jr.
recognition of Mr. Welch's unique contribution to the creation of more than
$150 billion of shareholder value during his tenure as the Chairman of the
Board and Chief Executive Officer of General Electric Company
("Company"), the Board of Directors wishes to obtain his commitment
to serve as Chairman of the Board of Directors and Chief Executive Officer of
the Company until December
31, 2000, and his commitment to serve thereafter as a consultant to
and representative of the Company, at the direction of the Chief Executive
Officer of the Company; and
NOW THEREFORE, the Company and Mr. Welch
agree as follows:
1. Mr. Welch agrees
to continue to serve as Chairman of the Board of Directors and Chief Executive
Officer of the Company for the period from the date of this agreement until December 31, 2000,
on terms no less favorable to him than his present conditions of employment, or
such earlier date as the Board of Directors may determine at anytime in its
2. Mr. Welch agrees that, following
his retirement from the Company, and when and as requested by the Chief
Executive Officer of the Company, he will provide consulting and advice to the
Company and will participate in various external activities and events for the
benefit of the Company. Mr.
Welch agrees to provide up to 30
days per year to the Company, subject to his reasonable availability, for such
consulting services or such participation in external activities and events. In
addition, Mr. Welch agrees to obtain the approval of the
Management Development and Compensation Committee of the Board of Directors
before providing any consulting, advice or service of any kind to any other
company or organization that competes with the Company.
3. The services
contemplated under this agreement will require that Mr. Welch
have access, following his retirement, to information which is proprietary or
confidential to the Company. Mr.
Welch agrees not to publish or
otherwise disclose to persons outside the Company, without specific permission
from the Company, any Company proprietary or confidential information which he
acquires as a result of services performed under this agreement, and not to use
such information in any way which might be detrimental to the interests of the
4. Mr. Welch also agrees to
promptly disclose to the Company any information, ideas, or inventions made or
conceived by him which may result from or be suggested
by post-retirement services performed by him under this agreement, and to
assign to the Company all rights pertaining to such information, ideas, or
inventions. Knowledge or information of any kind disclosed by Mr. Welch to the
Company shall be deemed to have been disclosed without obligation on the part
of the Company to hold the same in confidence, and the Company shall have the
full right to use and disclose such knowledge and information without
compensation to Mr. Welch beyond that specifically provided in this agreement.
5.In return for his
willingness to continue to help create value for the Company's shareholders
throughout his retirement, and in return for the foregoing commitments by Mr.
Welch, the Company shall pay Mr. Welch, for consulting services or
participation in external activities and events performed at the request of the
Chief Executive Officer of the Company, a daily consulting fee, for the days he
renders services, equal to his daily salary rate at the time of his retirement,
and, as an annual retainer, shall pay for 5 days of such services in advance at
the beginning of each year of his retirement. In addition, the Company shall
provide Mr. Welch, for the remainder of his life,
continued access to Company facilities and services comparable to those
provided to him prior to his retirement, including access to Company aircraft,
cars, office, apartments, and financial planning services. The Company shall
also reimburse Mr. Welch, upon the receipt of appropriate
documentation, for reasonable travel and living expenses which he incurs in
providing services at the request of the Chief Executive Officer, or which he
incurs because of his position as a retired Chairman of the Board and Chief
Executive Officer of the Company. Subject only to Mr. Welch's compliance, to
the best of his ability, with his commitments set forth in paragraph 1 of this
agreement, the Company's obligations set forth in this agreement are
unconditional and irrevocable and shall apply irrespective of Mr. Welch's
incapacitation, prior or subsequent to his retirement, to perform services
hereunder, provided, however, that the Company's obligation to pay Mr. Welch an
annual retainer shall terminate if he should become totally and permanently
unable to provide services hereunder.
6. Nothing in this
agreement shall require any change in the Board's current processes for
establishing Mr. Welch's salary, bonus and long-term
incentive compensation awards based on his performance during the remainder of
his service as Chairman and Chief Executive Officer.
7. Following his
retirement, Mr. Welch shall be an independent contractor under this agreement,
and no provision of, or action taken under, this agreement shall affect in any way Mr.
Welch's rights under any Company compensation, employee benefit and welfare
plans, programs or practices, including, without limitation, Company executive
compensation, insurance, or pension plans.
8. This agreement
is the sole agreement between Mr.
Welch and the Company with respect
to the duration of his service as Chairman of the Board and Chief Executive Officer, and to his post-retirement consulting services and
activities for the Company, and supersedes all prior agreements and
understandings with respect thereto. No change, modification, alteration or
addition to any provision hereof shall be binding unless in writing and signed
by both Mr. Welch and a duly authorized representative
of the Board of Directors of the Company.
By order of the
Board of Directors