C97-1

General Dynamics Completes Acquisition
of Two Lockheed Martin Units

To all employees

General Dynamics (NYSE:GD) has completed its purchase of the assets of Lockheed Martin Defense Systems and Lockheed Martin Armament Systems. The 30-day waiting period mandated by the Hart Scott Rodino pre-merger notification act expired without action by the Department of Justice on December 19, 1996, and the companies closed the transaction effective January 1, 1997. General Dynamics acquired the two units for $450 million, and assumed no debt in the transaction.

Lockheed Martin Defense Systems, based in Pittsfield, Massachusetts, has major product lines in the area of combat vehicles; Lockheed Martin Armament Systems, based in Burlington, Vermont, is principally a supplier of gun systems.

The acquisition is General Dynamics’ third in the past 16 months. The company bought shipbuilder Bath Iron Works in September 1995, and acquired Teledyne Vehicle Systems in March 1996. General Dynamics, headquartered in Falls Church, Virginia, designs and builds nuclear submarines, surface combatant ships and armored vehicles. It employs more than 27,000 people and has annualized sales of approximately $4 billion.

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