NASSCO Receives Two-Year LHA/LHD Contract Extension from the U.S. Navy October 11, 2002 -- SAN DIEGO, CA -- National Steel and Shipbuilding Company (NASSCO), a wholly owned subsidiary of General Dynamics (NYSE: GD), today announced that it has been awarded a two-year extension on a contract for the phased maintenance of the five San Diego-based LHA and LHD class ships for the U.S. Navy. A seven-year contract with an option for the additional two years was originally awarded in December 1997. NASSCO is the prime contractor and is teamed with Southwest Marine, Continental Maritime Industries San Diego, and Pacific Ship Repair and Fabrication to accomplish the additional work. Five maintenance and repair availabilities, including two drydockings at NASSCO, are encompassed by the contract. The LHAs and LHDs are large, sophisticated amphibious assault ships that are the primary landing ships for the Marine Expeditionary Units. They forward deploy marines, helicopters and fixed wing aircraft, combat vehicles, and supplies to areas of vital U.S. interest world-wide. The five LHA/LHD ships home-ported in San Diego during the contract period are the USS Tarawa (LHA-1), USS Belleau Wood (LHA-3), USS Peleliu (LHA-5), USS Boxer (LHD-4) and USS Bonhomme Richard (LHD-6). Richard Vortmann, NASSCO’s president, said, "This contract extension is a tribute to the performance of the strong San Diego team that is meeting the long-term maintenance and repair needs of these complex ships at the lowest cost and shortest schedule. The LHA/LHD contract has been a win-win for the crews of the ships and their families, the Navy, and the ship repair industry in San Diego." Prior to the 1997 Phased Maintenance Contract, LHAs and LHDs on the West Coast were sent to the Navy shipyards in Long Beach or Bremerton, Washington, for up to nine months of overhaul, forcing their crews to either relocate or be away from home for extended periods of time. "The Navy wanted an alternative to the expense and personnel disruption caused by sending these ships away from their home port," Vortmann said. "Over the past five years, we have invested heavily in the necessary infrastructure to perform that maintenance and complex modernization work in the San Diego homeport." Vortmann said the advantages of this long-term maintenance contract include continuity in staffing for the shipyards, more orderly planning and purchasing, and the transfer of lessons learned between ships, all leading to efficient production and lower costs for the Navy. While the extension does not carry a dollar amount, Vortmann said work on the contract to date has averaged approximately $100 million a year. General Dynamics, headquartered in Falls Church, Virginia, employs approximately 54,000 people worldwide and anticipates 2002 revenues of approximately $14 billion. The company has leading market positions in land and amphibious combat systems, mission-critical information systems and technologies, shipbuilding and marine systems, and business aviation. More information about the company can be found at www.generaldynamics.com.

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