Exhibit 10.2

 

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December 2, 2013

 

Mr. Jeremy  W. Smeltser

13320 Ballantyne Corporate Place

Charlotte, NC 28277

 

Dear Jeremy:

 

SPX Corporation (the “Company”) recognizes that your contribution to its growth
and success  have been and will continue to be substantial and desires to assure
your continued employment.  In this regard, the Board of Directors of the
Company (the “Board”) recognizes that, as is the case with many publicly held
corporations, the possibility of a Change of Control (as defined in Section 2,
below) may exist and that such possibility, and the uncertainty and questions
that it may raise among management, may result in the departure or distraction
of management personnel to the detriment of the Company and its shareholders.

 

The Board has determined that appropriate steps should be taken to reinforce and
encourage the continued attention and dedication of members of the Company’s
management, including yourself, to their assigned duties without distraction in
the face of potentially disruptive circumstances arising from the possibility of
a Change of Control.

 

Further, it is the intent of the Board in adopting this agreement, originally
agreed to April 22, 2009 (the “2009 Agreement”), and as amended and restated
herein (the “Agreement”), to assure the Company and its shareholders (i) of
continuity of management in the event of any actual or threatened Change of
Control and (ii) that key executive employees of the Company will be able to
evaluate objectively whether a potential Change of Control is in the best
interests of the shareholders.

 

In order to induce you to remain in the employ of the Company and to advance the
interests of the Company and its shareholders by providing you with appropriate
financial protection, the Board agrees that you shall receive the severance
benefits set forth in this Agreement in the event that you separate from service
due to a Change of Control as specifically provided in the remainder of this
Agreement.  For purposes of this Agreement, your employment with the Company
shall be deemed to be terminated when you have a “Separation from Service”
within the meaning of Section 409A of the Internal Revenue Code of 1986 (the
“Code”), and references to your termination of employment shall be deemed to
refer to a Separation from Service.

 

1.                                      Term of Agreement.  This Agreement, as
amended and restated herein, will become effective on March 10, 2014 (the
“Effective Date”), and shall continue in effect through the second (2nd)
anniversary of the Effective Date (the “Term”); provided, however, that this
Agreement shall remain in effect and the Term shall be extended automatically
from year to year thereafter for one (1) additional year unless, not later than
six (6) months

 

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prior to the second (2nd) anniversary of the Effective Date, or any subsequent
anniversary of the Effective Date, the Company gives written notice to you that
it has elected not to extend this Agreement.  Notwithstanding anything in this
Section 1 to the contrary, if a Change of Control occurs during the Term of this
Agreement, the Term of this Agreement shall be extended automatically to the
second (2nd) anniversary of the Change of Control. For the avoidance of doubt,
if a Change of Control (as defined in the 2009 Agreement) occurs before
March 10, 2014, the terms and provisions of the 2009 Agreement would continue to
apply.

 

2.                                      Change of Control of the Company.  No
benefits will be payable under the terms of this Agreement unless a Change of
Control of the Company has occurred.  A “Change of Control” shall be deemed to
have occurred if:

 

(a)                                 Any “Person” (as defined below), excluding
for this purpose the Company or any subsidiary of the Company, any employee
benefit plan of the Company or of any subsidiary of the Company, or any entity
organized, appointed or established for or pursuant to the terms of any such
plan that acquires beneficial ownership of common shares of the Company, is or
becomes the “Beneficial Owner” (as defined below) of twenty-five percent (25%)
or more of the common shares of the Company then outstanding; provided, however,
that no Change of Control shall be deemed to have occurred as the result of an
acquisition of common shares of the Company by the Company which, by reducing
the number of shares outstanding, increases the proportionate beneficial
ownership interest of any Person to twenty-five percent (25%) or more of the
common shares of the Company then outstanding, but any subsequent increase in
the beneficial ownership interest of such a Person in common shares of the
Company shall be deemed a Change of Control; and provided further that if the
Board of Directors of the Company determines in good faith that a Person who has
become the Beneficial Owner of common shares of the Company representing
twenty-five percent (25%) or more of the common shares of the Company then
outstanding has inadvertently reached that level of ownership interest, and if
such Person divests as promptly as practicable a sufficient number of shares of
the Company so that the Person no longer has a beneficial ownership interest in
twenty-five percent (25%) or more of the common shares of the Company then
outstanding, then no Change of Control shall be deemed to have occurred.  For
purposes of this Section 2(a), the following terms shall have the meanings set
forth below:

 

(i)                                     “Person” shall mean any individual,
firm, limited liability company, corporation or other entity, and shall include
any successor (by merger or otherwise) of any such entity.

 

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(ii)                                  “Affiliate” and “Associate” shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”).

 

(iii)          A Person shall be deemed the “Beneficial Owner” of and shall be
deemed to “beneficially own” any securities:

 

(A)                               that such Person or any of such Person’s
Affiliates or Associates beneficially owns, directly or indirectly (determined
as provided in Rule 13d-3 under the Exchange Act);

 

(B)                               that such Person or any of such Person’s
Affiliates or Associates has (1) the right to acquire (whether such right is
exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (other than customary agreements with
and between underwriters and selling group members with respect to a bona fide
public offering of securities), or upon the exercise of conversion rights,
exchange rights, rights, warrants or options, or otherwise; provided, however,
that a Person shall not be deemed the Beneficial Owner of, or to beneficially
own, securities tendered pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person’s Affiliates or Associates until
such tendered securities are accepted for purchase or exchange; or (2) the right
to vote pursuant to any agreement, arrangement or understanding; provided,
however, that a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security if the agreement, arrangement or understanding to
vote such security (a) arises solely from a revocable proxy or consent given to
such Person in response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable rules and regulations promulgated
under the Exchange Act and (b) is not also then reportable on Schedule 13D under
the Exchange Act (or any comparable or successor report); or

 

(C)                               that are beneficially owned, directly or
indirectly, by any other Person with which such Person or any of such Person’s
Affiliates or Associates has any agreement, arrangement or understanding (other
than customary agreements with and between underwriters and selling group
members with respect to a bona fide public offering of securities) for the
purpose of acquiring, holding, voting (except to the extent contemplated by the
proviso to Section 2(a)(iii)(B)(2) above) or disposing of any securities of the
Company.

 

Notwithstanding anything in this definition of Beneficial Ownership to the
contrary, the phrase “then outstanding,” when used with reference to a Person’s
beneficial ownership of securities of the Company, shall mean the number of such

 

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securities then issued and outstanding together with the number of such
securities not then actually issued and outstanding that such Person would be
deemed to own beneficially hereunder.

 

(b)                                 During any period of two (2) consecutive
years (not including any period prior to the execution of this Agreement),
individuals who at the beginning of such two (2)-year period constitute the
Board of Directors of the Company and any new director or directors (except for
any director designated by a person who has entered into an agreement with the
Company to effect a transaction described in Section 2(a), above, or
Section 2(c), below) whose election by the Board or nomination for election by
the Company’s shareholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute at least a majority of the Board; or

 

(c)                                  The consummation of: (i) a plan of complete
liquidation of the Company, (ii) an agreement for the sale or disposition of the
Company or all or substantially all of the Company’s assets, (iii) a plan of
merger or consolidation of the Company with any other corporation, or (iv) a
similar transaction or series of transactions involving the Company (any
transaction described in parts (i) through (iv) of this Section 2(c) being
referred to as a “Business Combination”), in each case unless after such a
Business Combination the shareholders of the Company immediately prior to the
Business Combination continue to own at least seventy-five percent (75%) of the
voting securities of the new (or continued) entity immediately after such
Business Combination, in substantially the same proportion as their ownership of
the Company immediately prior to such Business Combination.

 

Notwithstanding any provision in this Agreement to the contrary, a “Change of
Control” shall not include any transaction described in Section 2(a) or (c),
above, where, in connection with such transaction, you and/or any party acting
in concert with you substantially increase your, his or its, as the case may be,
ownership interest in the Company or a successor to the Company (other than
through conversion of prior ownership interests in the Company and/or through
equity awards received entirely as compensation for past or future personal
services).

 

3.                                      Definitions.  The following definitions
shall be used in determining whether, under the terms of Section 4 hereof, you
are entitled to receive Accrued Benefits and/or Severance Benefits:

 

(a)                                 Disability.  For purposes of this Agreement,
“Disability” shall mean, in the written opinion of a qualified physician
selected by the Company, the Executive is by reason of any medically
determinable physical or mental impairment that

 

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can be expected to result in death or can be expected to last for a continuous
period of not less than twelve (12) months, (x) unable to engage in any
substantial gainful activity, or (y) receiving income replacement benefits for a
period of not less than three (3) months under a Company disability plan.

 

(b)                             Retirement.  “Retirement” shall mean your
voluntary separation from service (other than for Good Reason, as defined below)
at a time after you have reached age sixty-five (65).

 

(c)                                  Cause.  “Cause” shall mean (i) your willful
and continued failure to substantially perform your duties with the Company
(other than any such failure resulting from Disability or occurring after
issuance by you of a Notice of Termination for Good Reason), after a demand for
substantial performance is delivered to you that specifically identifies the
manner in which the Company believes that you have not substantially performed
your duties, and after you have failed to resume substantial performance of your
duties on a continuous basis within fourteen (14) calendar days after receiving
such demand, (ii) you willfully engage in conduct that is demonstrably and
materially injurious to the Company, monetarily or otherwise, or (iii) your
having been convicted of (or pleaded nolo contendere to) a felony that impairs
your ability substantially to perform your duties with the Company.  For
purposes of this Section 3(c), no act, or failure to act, on your part shall be
deemed “willful” unless done, or omitted to be done, by you not in good faith
and without reasonable belief that your action or omission was in the best
interest of the Company.  In addition, your employment shall be deemed to have
terminated for Cause if, after your employment has terminated, facts and
circumstances are discovered that would have justified a termination for Cause.

 

The Company shall make any decision that Cause exists in good faith.  For
purposes of this Agreement, no act or failure to act on your part shall be
considered “willful” unless it is done, or omitted to be done, by you in bad
faith or without reasonable belief that your action or omission was in the best
interests of the Company or any successor or affiliate.  Any act, or failure to
act, on your part, based upon authority given pursuant to a resolution duly
adopted by the Board or based upon the advice of counsel for the Company or any
successor or affiliate shall be conclusively presumed to be done, or omitted to
be done, in good faith and in the best interests of the Company or any successor
or affiliate thereof.

 

(d)                                 Good Reason.  You shall be entitled to
terminate your employment for Good Reason.  For purposes of this Agreement,
“Good Reason” shall mean, without your express written consent, the occurrence
within two (2) years following a Change of Control of the Company of any one
(1) or more of the following:

 

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(i)                                     A reduction or alteration in your duties
and responsibilities, or the status of your position from those in effect on the
day prior to the Change of Control;

 

(ii)                                  A reduction by the Company in your base
salary or in your most recent annual target incentive award opportunity as in
effect on the date hereof or as the same shall be increased from time to time;

 

(iii)          The Company’s requiring you to be based at a location in excess
of fifty (50) miles from the location where you are currently based;

 

(iv)                              The failure by the Company to continue in
effect the Company’s Individual Account Retirement Plan, Retirement Savings and
Stock Ownership Plan, Supplemental Retirement Savings Plan, Supplemental
Retirement Plan for Top Management, applicable executive bonus plan, 2002 Stock
Compensation Plan, any plans substituted for the above adopted prior to the
Change of Control, or any other of the Company’s employee benefit plans,
policies, practices or arrangements in which you participate, unless an
equitable arrangement (embodied in an ongoing substitute or alternative plan) to
provide similar benefits has been made with respect to such plan(s); or the
failure by the Company to continue your participation therein (or in such
substitute or alternative plan) on substantially the same basis, both in terms
of the amount of benefits provided and the level of your participation relative
to other participants, as existed as of the time of the Change of Control;

 

(v)                                 The failure of the Company to reinstate your
employment in full (in the same capacity that you were employed, or in a
mutually agreeable capacity) in the event that your employment was suspended due
to a Disability and, within three (3) years of the Disability, you request to be
reinstated and are ready, willing, and able to adequately perform your
employment duties;

 

(vi)          The separation from service, replacement, or reassignment of
twenty-five percent (25%) or more of the elected officers of the Company
existing as of the day prior to a Change of Control, excluding any officer who
separates from service due to death, Disability, or Retirement, or who is
terminated by the Company for Cause, or who terminates other than for Good
Reason (all as herein defined);

 

(vii)                           The failure of the Company to obtain a
satisfactory agreement from any successor to the Company to assume and agree to
perform this Agreement, as contemplated in Section 5 hereof; and

 

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(viii)        Any purported termination by the Company of your employment that
is not effected pursuant to a Notice of Termination satisfying the requirements
of Section 3(f), below, and for purposes of this Agreement, no such purported
termination shall be effective.

 

Your right to separate from service pursuant to this Section 3(d) shall not be
affected by your suspension due to Disability.  Your continued employment shall
not constitute a waiver of your rights with respect to any circumstance
constituting Good Reason hereunder, except that you must provide notice to the
Company of the existence of the condition described in above within a period not
to exceed ninety (90) days of the initial existence of the condition, and the
Company will have a period of at least thirty (30) days following the notice
during which it may remedy the condition.

 

(e)                                  Notice of Termination.  Any termination by
the Company for Cause or by you for Good Reason shall be communicated by Notice
of Termination to the other party hereto.  For purposes of this Agreement, a
“Notice of Termination” shall mean a written notice that shall indicate the
specific termination provision in this Agreement relied upon and shall set forth
in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provisions so indicated.

 

(f)                                   Date of Termination.  “Date of
Termination” shall mean the date specified in the Notice of Termination where
required (but not less than thirty (30) calendar days following delivery of the
Notice of Termination, except that termination for Cause may be effective
immediately) or in any other case upon ceasing to perform services to the
Company; provided that if within twenty (20) calendar days after any Notice of
Termination one party notifies the other party that a dispute exists concerning
the termination, the Date of Termination shall be the date finally determined to
be the Date of Termination, either by written agreement of the parties or by a
binding and final arbitration decision.  In the event that a dispute exists
concerning the Date of Termination, you shall continue to receive your full
compensation (including participation in all benefit and insurance plans in
which you were participating) in effect when the notice giving rise to the
dispute was given, until the Date of Termination is finally determined.  In such
event, you will be required to reimburse the Company for all compensation
received beyond the finally determined Date of Termination either by direct cash
reimbursement within thirty (30) calendar days of resolving the conflict or by
appropriately reducing your remaining benefits to be received under the terms of
this Agreement.

 

(g)                                  Earned Bonus Amount.  For any year prior to
the year during which a Change of Control occurs, your “Earned Bonus Amount”
means your actual bonus for that

 

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year.  For the year during which a Change of Control occurs, your “Earned Bonus
Amount” means your total potential bonus for the year as determined under the
2005 Executive Bonus Plan or applicable successor bonus plan (the “Bonus Plan”),
according to the business performance metric achieved, and prorated to reflect
your length of service during the Bonus Plan year.  For any year following the
year during which a Change of Control occurs, your “Earned Bonus Amount” means
the greater of (i) your actual bonus for the year prior to the year during which
the Change of Control occurs and (ii) your total potential bonus for the year as
determined under the Bonus Plan, according to the business performance metric
achieved, and prorated to reflect your length of service during the Bonus Plan
year.

 

4.                                      Compensation Upon Separation from
Service Following a Change of Control.

 

(a)                                 Accrued Benefits.  In the event that you
separate from service for any reason during the Term of this Agreement following
a Change of Control of the Company, you shall receive your Accrued Benefits
through the Date of Termination to the extent unpaid.  For purposes of this
Agreement, your “Accrued Benefits” shall include the following:

 

(i)                                     All base salary for the time period
ending with your Date of Termination, at the rate in effect at the time Notice
of Termination is given or on the Date of Termination if no Notice of
Termination is required;

 

(ii)                                  A bonus payment equal to one hundred
percent (100%) of the greater of (A) your target bonus for the year in which the
Date of Termination occurs, prorated based upon the ratio of the number of
months (full credit for a partial month) you were employed during that bonus
year to the total months in that bonus year, and (B) your Earned Bonus Amount
for the year in which the Date of Termination occurs, calculated as if the Date
of Termination were the end of that year for purposes of the Bonus Plan;

 

(iii)                               A cash equivalent of all unused vacation to
which you were entitled through your Date of Termination;

 

(iv)                              Reimbursement for any and all monies advanced
in connection with your employment for reasonable and necessary expenses
incurred by you on behalf of the Company for the time period ending with your
Date of Termination;

 

(v)                                 Your accrued benefit under the SPX
Corporation Supplemental Retirement Plan for Top Management; and

 

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(vi)                              All other amounts to which you are entitled
under any compensation or benefit plan, program, practice or policy of the
Company in effect as of the Date of Termination.

 

(vii)                           Subject to Section 4(e), the payments provided
for in Section 4(a)(i), (ii), (iii), and (iv) above shall be made in a lump sum
cash payment as soon as administratively practicable (but in no event more than
ten (10) days) following your Date of Termination.  If the total amount of
annual bonus is not determinable on that date, the Company shall pay the amount
of bonus that is determinable and the remainder shall be paid in a lump sum cash
payment at the time such bonuses are paid generally and in all events within the
two and one-half (2½) months following the end of the calendar year in which the
bonus is earned.

 

(b)                                 Severance Benefits.  In the event that you
separate from service during the Term of this Agreement following a Change of
Control, unless your separation from service is (i) because of your death,
Disability, or Retirement; (ii) a termination by the Company for Cause; or
(iii) a termination by you other than for Good Reason, you shall receive, in
addition to your Accrued Benefits, the Severance Benefits.  For purposes of this
Agreement, your “Severance Benefits” shall include the following:

 

(i)                                     Your annual base salary at the rate in
effect immediately prior to the Change of Control of the Company or, if greater,
at the rate in effect at the time Notice of Termination is given, or on the Date
of Termination if no Notice of Termination is required, multiplied by two (2);

 

(ii)                                  An amount equal to two (2) times the
greatest of (A) the highest of your Earned Bonus Amounts for the three (3) years
immediately preceding the year in which the Date of Termination occurs (the
“Year of Termination”) or (B) your target bonus under the Bonus Plan for the
Year of Termination or (C) your Earned Bonus Amount for the Year of Termination,
calculated as if the Date of Termination were the end of that year for purposes
of the Bonus Plan;

 

(iii)          For a two (2) -year period after your Date of Termination, the
Company will arrange to provide to you the same group health care coverage you
had prior to your Date of Termination, at the Company’s expense, which includes,
but is not limited to, hospital, surgical, medical, dental, and dependent
coverages.  For purposes of the retiree medical coverage, you will receive the
same number of additional years of credited service for computing your benefit
as normally computed under the terms of the retiree medical plan.  Health care
benefits otherwise receivable by you

 

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pursuant to this Section 4(b)(iii) shall be reduced to the extent comparable
benefits are actually received by you from a subsequent employer during the two
(2) -year period following your Date of Termination, and any such benefits
actually received by you shall be reported to the Company.  To the extent the
provision of health care benefits receivable by you pursuant to this
Section 4(b)(iii) extends beyond the COBRA continuation period, such benefits
will be provided in accordance with the requirements of Code Section 409A and
Treasury Regulation §1.409A-3(i)(1)(iv) (or any similar or successor
provisions);

 

(iv)                              For a two (2) -year period after your Date of
Termination, the Company will arrange to provide to you, at the Company’s
expense, life insurance coverage in the amount of two (2) times your base salary
in effect at your Date of Termination and, at the end of the two (2) -year
period, for the remainder of your life the Company will provide to you life
insurance coverage in the amount of your base salary in effect at your Date of
Termination provided that such coverage will be provided in accordance with the
requirements of Code Section 409A and Treasury Regulation
§1.409A-3(i)(1)(iv) (or any similar or successor provisions;

 

(v)                                 Under the Company’s Individual Account
Retirement Plan and Supplemental Retirement Plan for Top Management, you will
receive immediate full vesting as of your Date of Termination and receive two
(2) additional full years of service credit for computing your accrued
retirement benefit under both plans. Further, in computing the accrued
retirement benefits under both plans, two (2) years will be added to your actual
age, and the definition of “Final Average Pay” (base and bonus) shall be the
greater of (A) your highest three (3) -year average or (B) the sum of your
actual base salary in effect at your Date of Termination plus the greatest of
the bonus amounts described in parts (A), (B) and (C) of Section 4(b)(ii),
above, with the additional benefits, to the extent not payable under the
Individual Account Retirement Plan, to be paid as an additional benefit under
the Supplemental Retirement Plan for Top Management;

 

(vi)                              Under the Company’s Supplemental Retirement
Savings Plan (the “SRSP”), you will receive a cash lump sum payment of the full
balance (vested and unvested) of your Pre-2005 Account (as defined in the SRSP);

 

(vii)                           Each stock option that you have been granted by
the Company and that is not yet vested shall become immediately vested and
exercisable and shall continue to be exercisable for the lesser of (A) two
(2) years following your Date of Termination or (B) the time remaining until the
originally

 

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designated expiration date, unless a longer exercise period is provided for in
the applicable plan or award agreement;

 

(viii)                        Any contractual restrictions placed on shares of
restricted stock or other equity-based compensation awards that you have been
awarded pursuant to the Company’s 2002 Stock Compensation Plan shall lapse as of
your Date of Termination;

 

(ix)                              In the event that a Change of Control occurs
and payments are made under this Section 4(b), and a final determination is made
by legislation, regulation, ruling, or court decision directed to you or the
Company that the aggregate amount of any payments made to you under this
Agreement and any other agreement, plan, program, or policy of the Company in
connection with, on account of, or as a result of, such Change of Control (the
“Total Payments”) will be subject to an excise tax under the provisions of Code
Section 4999, or any successor section thereof (“Excise Tax”), the Total
Payments shall be reduced (beginning with those amounts that are exempt from
Code Section 409A and then from amounts that are subject to Code Section 409A,
beginning with the amounts scheduled to be paid furthest from the first date of
the Total Payments) so that the maximum amount of the Total Payments (after
reduction) shall be one dollar ($1.00) less than the amount that would cause the
Total Payments to be subject to the Excise Tax; provided, however, that the
Total Payments shall only be reduced to the extent that the after-tax value of
amounts received by you after application of the above reduction would exceed
the after-tax value of the Total Payments received without application of such
reduction.  For this purpose, the after-tax value of an amount shall be
determined taking into account all federal, state, and local income, employment,
and excise taxes applicable to such amount.  In making any determination as to
whether the Total Payments would be subject to an Excise Tax, consideration
shall be given to whether any portion of the Total Payments could reasonably be
considered, based on the relevant facts and circumstances, to be reasonable
compensation for services rendered (whether before or after the consummation of
the applicable Change of Control).

 

(A)                               In the event that upon any audit by the
Internal Revenue Service, or by a state or local taxing authority, of the Total
Payments, a change is formally determined to be required in the amount of taxes
paid by, or Total Payments made to, you, appropriate adjustments will be made
under this Agreement such that the net amount that is payable to you after
taking into account the

 

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provisions of Code Section 4999 will reflect the intent of the parties as
expressed in this Section 4(b)(ix).  You shall notify the Company in writing of
any claim by the Internal Revenue Service that, if successful, would require
payment of an Excise Tax or an additional Excise Tax on the Total Payments (a
“Claim”).  Such notification shall be given as soon as practicable but no later
than ten (10) business days after you are informed in writing of such Claim and
shall apprise the Company of the nature of such Claim and the date on which such
Claim is requested to be paid.  You shall not pay such Claim prior to the
expiration of the thirty (30)-day period following the date on which you give
such notice to the Company (or such shorter period ending on the date that any
payment of taxes with respect to such Claim is due).  If the Company notifies
you in writing prior to the expiration of such period that it desires to contest
such Claim, you shall: (1) give the Company any information reasonably requested
by the Company relating to such Claim, (2) take such action in connection with
contesting such Claim as the Company shall reasonably request in writing from
time to time, including, without limitation, accepting legal representation with
respect to such Claim by an attorney reasonably selected by the Company, (3)
cooperate with the Company in good faith in order to contest effectively such
Claim, and (4) permit the Company to participate in any proceedings relating to
such Claim; provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold you harmless, on an
after-tax basis, for any Excise Tax, additional Excise Tax, or income tax
(including interest and penalties with respect thereto) imposed as a result of
such representation and payment of costs and expenses.  Without limitation on
the foregoing provisions of this paragraph, the Company, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such Claim and may, at its
sole option, either direct you to pay the tax claimed and sue for a refund or
contest the Claim in any permissible manner, and you agree to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one (1) or more appellate courts, as the Company
shall determine, provided, however, that if the Company directs you to pay such
Claim and sue for a refund, the Company shall advance the amount of such payment
to you on an interest-free basis or, if such an advance is

 

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not permissible under applicable law, pay the amount of such payment to you as
additional compensation, and shall indemnify and hold you harmless, on an
after-tax basis, from any Excise Tax, additional Excise Tax, or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or additional compensation; and further provided that any extension
of the statute of limitations relating to payment of taxes for the taxable year
of you with respect to which such contested amount is claimed to be due is
limited solely to such contested amount.  The Company shall reimburse any fees
and expenses provided for under this Section 4(b)(ix) on or before the last day
of your taxable year following the taxable year in which the fee or expense was
incurred, and in accordance with the other requirements of Code Section 409A and
Treasury Regulation § 1.409A-3(i)(1)(v) (or any similar or successor
provisions).

 

(B)                               If, after your receipt of an amount advanced
or paid by the Company pursuant to the immediately preceding paragraph, you
become entitled to receive any refund with respect to such Claim, you shall
(subject to the Company’s compliance with the requirements of the immediately
preceding paragraph) promptly pay to the Company the amount of such refund
(together with any interest paid or credited thereon after taxes applicable
thereto).  If, after your receipt of an amount advanced by the Company pursuant
to the immediately preceding paragraph, a determination is made that you shall
not be entitled to any refund with respect to such Claim and the Company does
not notify you in writing of its intent to contest such denial of refund prior
to the expiration of thirty (30) days after such determination, then such
advance shall be forgiven and shall not be required to be repaid.

 

(x)                             To the full extent permitted by law, the Company
shall indemnify you (including the advancement of expenses) for any judgments,
fines, amounts paid in settlement and reasonable expenses, including attorneys’
fees, incurred by you in connection with the defense of any lawsuit or other
claim to which you are made a party by reason of being or having been an
officer, director or employee of the Company or any of its subsidiaries.  In
addition, you will be covered by director and officer liability insurance to the
maximum extent that such insurance maintained by the Company from time to time
covers any officer or director (or former officer or director) of the Company. 
Any costs and expenses that are to be paid or reimbursed pursuant to the
preceding provisions of this

 

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Section 4(b)(x) shall be reimbursed in accordance with the requirements of Code
Section 409A and Treasury Regulation §1.409A-3(i)(1)(iv) (or any similar or
successor provisions).

 

(xi)          You will be entitled to receive outplacement services, at the
expense of the Company, from a provider reasonably selected by you.  Such
outplacement services must be incurred by you no later than the end of the
calendar year that includes the second anniversary of your separation from
service.  If applicable, reimbursement of such expenses shall be made to you no
later than the end of the calendar year that includes the third anniversary of
your separation from service.

 

(xii)         To the extent that you prevail in any contest or dispute with
respect to any interpretation, enforcement or defense of your rights under this
Agreement by litigation or otherwise, the Company shall pay to you or reimburse
you for all legal fees and expenses incurred by you as a result of such contest
or dispute (including all such fees and expenses, if any, incurred in contesting
or disputing any separation from service or in seeking to obtain or enforce any
right or benefit provided by this Agreement or in connection with any tax audit
or proceeding to the extent attributable to the application of Code Section 4999
to any payment or benefit provided hereunder, as described in Section 4(b)(ix)
above), provided that such fees and expenses that are to be paid or reimbursed
pursuant to the preceding provisions of this Section 4(b)(xii) shall be
reimbursed in accordance with the requirements of Code Section 409A and Treasury
Regulation §1.409A-3(i)(1)(iv) (or any similar or successor provisions); and

 

(xiii)        Subject to Section 4(e) and except as otherwise provided in this
Agreement, the  payments provided in Sections 4(b)(i), (ii), (v) (if a lump sum 
has been elected previously in accordance with the terms of the applicable
plan), and (vi) and (xii) above shall be made in a lump sum cash payment as soon
as administratively practicable (but in no event more than ten (10) days)
following your separation from service.  If the total amount of annual bonus is
not determinable on that date, the Company shall pay the amount of bonus that is
determinable and the remainder shall be paid in a lump sum cash payment at the
time such bonuses are paid generally and in all events within the two and
one-half (2½) months following the end of the calendar year in which the bonus
is earned.

 

(c)                                  Notwithstanding any provision in this
Agreement to the contrary, if a Change of Control occurs and you separate from
service other than for Cause within six (6) months prior to the date on which
the Change of Control occurs and you assert in

 

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writing to the Board within thirty (30) days following the Change of Control
that such separation from service (i) was at the request of a third party who
had taken steps reasonably calculated to effect the Change of Control, (ii)
otherwise arose in connection with or anticipation of the Change of Control, or
(iii) would not have occurred if the Change of Control were not anticipated,
then for all purposes of this Agreement your separation from service shall be
deemed to have occurred following the Change of Control and any payments owed to
you hereunder as a result of such Change of Control shall be paid to you within
sixty (60) days following the Change of Control, unless the Board determines in
good faith that your separation from service (i) was not at the request of a
third party who had taken steps reasonably calculated to effect the Change of
Control, (ii) did not otherwise arise in connection with or anticipation of the
Change of Control, and (iii) would have occurred if the Change of Control were
not anticipated.

 

(d)                                 You shall not be required to mitigate the
amount of any payment provided for in this Section 4 by seeking other employment
or otherwise, nor shall the amount of any payment provided for in this Section 4
be reduced by any compensation earned by you as the result of employment by
another employer after your Date of Termination, or otherwise, with the
exception of a reduction in your insurance benefits as provided in Section
4(b)(iii), and as provided in Section 13.

 

(e)                                  If, at the time you become entitled to your
Accrued Benefits and your Severance Benefits under this Section 4, you are a
“specified employee” (as defined under  Code Section 409A), then,
notwithstanding any provision in this Agreement to the contrary, the following
provisions shall apply.

 

(i)                                     None of your Accrued Benefits and
Severance Benefits considered deferred compensation under Code Section 409A and
not subject to an exception or exemption thereunder shall be paid to you until
the date that is six (6) months after your separation from service or, if
earlier, the date of your death (the “Six -Month Delay Rule”). Any such Accrued
Benefits and Severance Benefits that would otherwise have been paid to you
during this six-month period (the “Six -Month Delay”) shall instead be
aggregated and paid to you no later than ten (10) days following the date that
is six (6) months after your separation from service (together with interest at
the interest credit rate provided in the SPX Corporation Individual Account
Retirement Plan).  Any Accrued Benefits and Severance Benefits to which you are
entitled to be paid under this Section 4 after the date that is six (6) months
after your separation from service shall be paid to you in accordance with the
applicable terms of Section 4.

 

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(ii)           During the Six-Month Delay, the Company will pay to you the
applicable payments set forth in this Section 4, to the extent any of the
following exceptions to the Six-Month Delay Rule apply:

 

(A)                               the short-term deferral rule of Code Section
409A and Treasury Regulation §1.409A-1(b)(4) (or any similar or successor
provisions) (including with the treatment of each payment as one of a series of
separate payments for purposes of Code Section 409A and Treasury Regulation
§1.409A-2(b)(2)(iii)) (or any similar or successor provisions),

 

(B)                               payments permitted under the separation pay
exception of Code Section 409A and Treasury Regulation §1.409A-1(b)(9)(iii) (or
any similar or successor provisions), and

 

(C)                               payments permitted under the limited payments
exception of Code Section 409A and Treasury Regulation §1.409A-1(b)(9)(v)(D) (or
any similar or successor provisions),

 

provided that the amount paid under this Section 4(e)(ii) will count toward, and
will not be in addition to, the total payment amount required to be made to you
by the Company under this Section 4 on account of your separation from service
and any applicable Company benefit plan.

 

(f)                                   The Company shall deliver to you a form
general release and waiver of claims in favor of the Company that is acceptable
to the Company (the “Release”) as soon as administratively feasible following
your separation from service.  Notwithstanding any provision in this Agreement
to the contrary, no payments pursuant to Section 4(a)(ii) or Section 4(b) shall
be made prior to the date that both (i) you have delivered an original, signed
Release to the Company and (ii) the revocability period (if any) has elapsed;
provided, however, that any payments that would otherwise have been made prior
to such date but for the fact that you had not yet delivered an original, signed
Release (or the revocability period had not yet elapsed) shall be made as soon
as administratively practicable but not later than the seventy-fourth (74th) day
following your separation from service.  If you do not deliver an original,
signed Release to the Company within ten (10) business days (or longer if
required by applicable law) after receipt of the same from the Company, (i) your
rights shall be limited to those made available to you under Section 4(a) above
(excluding Section 4(a)(ii)), and (ii) the Company shall have no obligation to
pay or provide to you any amount or benefits described in Section 4(a)(ii) or
Section 4(b), or any other monies on account of your separation from service. 
Notwithstanding any language in this Agreement to the contrary, if the
seventy-fourth (74th) day following the date of your termination occurs in a

 

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different calendar year than the calendar year of your date of termination, then
the payment of any Severance Benefits subject to Code Section 409A shall be made
no earlier than January 1 of the calendar year following the year in which your
date of termination occurred.

 

5.                                      Successors; Binding Agreements.

 

(a)                                 The Company will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business and/or assets of the Company or of any
division or subsidiary thereof employing you to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place. 
Failure of the Company to obtain such assumption and agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement and
shall entitle you to compensation from the Company in the same amount and on the
same terms to which you would be entitled hereunder if you terminated your
employment for Good Reason following a Change of Control, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed your Date of Termination.

 

(b)                                 This Agreement shall inure to the benefit of
and be enforceable by your personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees, and legatees.  If you
should die while any amount would still be payable to you hereunder if you had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement, to your devisee, legatee or
other designee or, if there is no such designee, to your estate.

 

6.                                      No Funding of Benefits.  Nothing herein
contained shall require or be deemed to require the Company to segregate,
earmark, or otherwise set aside any funds or other assets to provide for any
payments to be made hereunder.  Your rights under this Agreement shall be solely
those of a general creditor of the Company.  However, in the event of a Change
of Control, the Company may deposit cash or property, or both, equal in value to
all or a portion of the benefits anticipated to be payable hereunder into a
trust, the assets of which are to be distributed at such times as are otherwise
provided for in this Agreement and are subject to the rights of the general
creditors of the Company.  The Company also may deposit additional amounts to
cover any administrative fees and expenses associated with the trust.

 

7.                                      Withholding of Taxes.  The Company may
withhold from any amounts payable under this Agreement all federal, state, city,
or other taxes as legally shall be required.  The Company may, at its option (a)
require you to pay to the Company in cash such amount

 

17

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as may be required to satisfy such withholding obligations or (b) make other
satisfactory arrangements with you to satisfy such withholding obligations.

 

8.                                      Notice.  For the purpose of this
Agreement, notices and all other communications provided for in this Agreement
shall be in writing and shall be deemed to have been duly given when delivered
or mailed by United States registered mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth on the first page of
this Agreement.

 

9.                                      Miscellaneous.  No provision of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing and signed by you and such officer as may
be specifically designated by the Board.  The validity, interpretation,
construction, and performance of this Agreement shall be governed by the laws of
the State of Delaware.  The Company and you agree that the jurisdiction and
venue for any disputes arising under, or any action brought to enforce, or
otherwise relating to, this Agreement shall be exclusively in the courts in the
State of North Carolina, Mecklenburg County, including the Federal Courts
located therein or responsible therefor (should Federal jurisdiction exist), and
the Company and you hereby submit and consent to said jurisdiction and venue.

 

10.                               Employment Rights.  This Agreement shall not
confer upon you any right to continue in the employ of the Company or its
subsidiaries and, except to the extent that benefits may become payable under
Section 4, above, shall not in any way affect the right of the Company or its
subsidiaries to dismiss or otherwise terminate your employment at any time and
for any reason with or without Cause.

 

11.                               No Vested Interest.  Neither you nor your
estate shall have any right, title or interest in any benefit under this
Agreement prior to the occurrence of all of the events specified herein as
necessary conditions to such right, title or interest.

 

12.                               Prior Agreements.  This Agreement contains the
understanding between the parties hereto with respect to severance benefits in
connection with a Change of Control of the Company and supersedes any prior such
agreement between the Company (or any predecessor of the Company) and you.  If
there is any discrepancy or conflict between this Agreement and any plan, policy
and program of the Company regarding any term or condition of severance benefits
in connection with a Change of Control of the Company, the language of this
Agreement shall govern.

 

13.                               Coordination with Employment Agreement. 
Payments and benefits under this Agreement shall be in lieu of or reduced by any
severance payments or benefits provided to the Executive under an Employment
Agreement or any other severance pay plan, policy or arrangement of the Company.

 

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14.                               Validity.  The invalidity or unenforceability
of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.

 

15.                               Counterparts.  This Agreement may be executed
in several counterparts, each of which shall be deemed to be an original but all
of which together shall constitute one and the same instrument.

 

16.                               Dispute Resolution.  Any dispute or
controversy arising under or in connection with this Agreement shall be settled
exclusively by arbitration in accordance with the rules of the American
Arbitration Association (“AAA”) then in effect, in Charlotte, North Carolina in
accordance with the AAA’s National Rules for the Resolution of Employment
Disputes.  Judgment may be entered on the arbitrator’s award in any court having
jurisdiction.  However, you shall be entitled to seek in court specific
performance of your right, pursuant to Section 3(f), above, to be paid until the
Date of Termination during the pendency of any dispute or controversy arising
under or in connection with this Agreement.  You acknowledge that by accepting
this arbitration provision you are waiving any right to a jury trial in the
event of a covered dispute.  The arbitrator may, but is not required to, order
that the prevailing party shall be entitled to recover from the losing party its
attorneys’ fees and costs incurred in any arbitration arising out of this
Agreement.  The arbitrator will have the right only to interpret and apply the
provisions of this Agreement and may not change any of its provisions.  The
arbitrator will permit reasonable pre-hearing discovery of facts, to the extent
necessary to establish a claim or a defense to a claim, subject to supervision
by the arbitrator.  The determination of the arbitrator will be conclusive and
binding upon the parties and judgment upon the same may be entered in any court
having jurisdiction thereof.  The arbitrator will give written notice to the
parties stating the arbitrator’s determination, and will furnish to each party a
signed copy of such determination.  Any arbitration or action pursuant to this
Section 16 will be governed by and construed in accordance with the substantive
laws of the State of Delaware and, where applicable, federal law, without giving
effect to the principles of conflict of laws of Delaware.  The Company will not
be required to seek or participate in arbitration regarding any actual or
threatened breach of any applicable non-compete, non-solicitation,
confidentiality or similar restrictive covenants applicable to you, but may
pursue its remedies in a court of competent jurisdiction.

 

17.                               Code Section 409A Compliance.  To the extent
any provision of this Agreement or action by the Company would subject you to
liability for interest or additional taxes under Code Section 409A, it will be
deemed null and void, to the extent permitted by law and deemed advisable by the
Company. It is intended that this Agreement will comply with Code Section 409A,
including the exceptions for short-term deferrals, separation pay arrangements,
reimbursements, and in-kind distributions, and this Agreement shall be
administered accordingly, and interpreted and construed on a basis consistent
with such

 

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intent. Each payment under Section 4 of this Agreement or any Company benefit
plan is intended to be treated as one of a series of separate payments for
purposes of Code Section 409A and Treasury Regulation §1.409A-2(b)(2)(iii) (or
any similar or successor provisions). This Agreement may be amended to the
extent necessary (including retroactively) by the Company in order to preserve
compliance with Code Section 409A. The preceding shall not be construed as a
guarantee of any particular tax effect for your compensation and benefits.

 

18.                               Payments to Estate.  The executor of your
estate shall be entitled to receive all amounts owing to you at the time of
death under this Agreement in full settlement and satisfaction of all claims and
demands on your behalf.  Such payments shall be in addition to any other death
benefits of the Company and in full settlement and satisfaction of all severance
benefit payments provided for in this Agreement.  In the event of your death or
a judicial determination of your incompetence, reference in this Agreement to
“you” will be deemed to refer, where appropriate, to your estate or other legal
representative.

 

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If this letter properly sets forth our agreement on the subject matter hereof,
kindly date, sign and return to the Company the enclosed copy of this letter,
which will then constitute our agreement on this subject.

 

EXECUTIVE ACCEPTANCE

SPX CORPORATION

 

 

/s/ Jeremy W. Smeltser

 

By:

/s/ Christopher J. Kearney

Jeremy W. Smeltser

 

Christopher J. Kearney

 

 

 

Its:

Chairman, President and Chief Executive Officer

 

 

 

Date:

December 2, 2013

 

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