What is the main purpose of this 8-K filing?

The main purpose of this 8-K filing is to disclose a new change-in-control agreement entered into by Northrop Grumman Corporation with its President and Chief Operating Officer, Wesley G. Bush. The agreement is effective January 1, 2010, and notably removes a previous tax gross-up provision.

What is a 'change-in-control agreement' and why is it important?

A change-in-control agreement is a contract between a company and an executive that provides certain benefits to the executive if their employment is terminated under specific circumstances following a change in the company's ownership or control. These agreements are important to investors as they can have significant financial implications for both the executive and the company, affecting executive retention and compensation costs.

What does the elimination of the 'tax gross-up' mean for Mr. Bush?

The elimination of the tax gross-up means that if a change in control occurs and Mr. Bush receives payments under the agreement that are subject to excise taxes, the company will no longer cover the cost of those excise taxes. This would result in Mr. Bush receiving a lower net amount of compensation in such a scenario compared to the previous agreement.

Where can I find the full details of the new agreement?

The filing states that the form of the Northrop Grumman Corporation January 2010 Special Agreement is included as Exhibit 10.1 to this 8-K filing. Investors can review this exhibit for the complete terms and conditions of the agreement.

NOC 8-K: Leadership Changes

Summary

Northrop Grumman Corporation (NOC) filed an 8-K on October 7, 2009, disclosing a change to a change-in-control agreement with its President and Chief Operating Officer, Wesley G. Bush. This new agreement, effective January 1, 2010, supersedes a prior agreement from January 2009 and importantly, eliminates the tax gross-up previously provided to Mr. Bush. This change suggests a modification in executive compensation structures related to potential change-in-control scenarios, which is a key consideration for investors monitoring corporate governance and executive pay practices. The filing also includes the form of this new January 2010 Special Agreement as an exhibit. While the full terms are not detailed in the 8-K itself, the removal of the tax gross-up is a significant point, potentially impacting the net compensation received by Mr. Bush in the event of a change in control and reflecting a broader trend towards reducing such provisions in executive agreements.

Key Highlights

1Northrop Grumman entered into a new change-in-control agreement with President and COO Wesley G. Bush, effective January 1, 2010.
2The new agreement replaces the January 2009 Special Agreement.
3A key change is the elimination of the tax gross-up previously provided under the prior agreement.
4The agreement was filed as Exhibit 10.1 to the 8-K.
5This filing indicates a modification in executive compensation related to change-in-control events.
6The filing was made on October 7, 2009, concerning an event on October 1, 2009.

NORTHROP GRUMMAN CORP /DE/ 8-K Report, Executive Changes (Oct 8, 2009)

Summary

Key Highlights

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