Exhibit 10(aa)
The Black & Decker Corporation
701 East Joppa Road
Towson, Maryland 21286
410-716-3900

BLACK & DECKER LOGO

                                                               October 25, 1995




Mr. Don R. Graber
14 Soundview Farm Road
Weston, Connecticut  06883

Dear Don:

         The  Black  &  Decker  Corporation  (the  "Corporation")  considers  it
essential to the best  interests of its  stockholders  to foster the  continuous
employment  of key  management  personnel.  In this  connection,  the  Board  of
Directors of the Corporation (the "Board")  recognizes that, as is the case with
many publicly held  corporations,  the possibility of a change in control of the
Corporation  may  exist  and that  such  possibility,  and the  uncertainty  and
questions  which it may raise among  management,  may result in the departure or
distraction of management  personnel to the detriment of the Corporation and its
stockholders.

         The Board has  determined  that  appropriate  steps  should be taken to
reinforce and encourage the continued attention and dedication of members of the
Corporation's  management,  including yourself, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the  Corporation,  although no such change
is now contemplated.

         In order to induce you to remain in the employ of the Corporation,  the
Corporation  agrees that you shall receive the  severance  benefits set forth in
this letter  agreement (the  "Agreement")  in the event your employment with the
Corporation is terminated subsequent to a "change in control of the Corporation"
(as defined in Section 2 hereof) under the circumstances described below.

          1.      Term of Agreement.  This Agreement shall commence on the date 
hereof and shall continue in effect through December 31, 2000; provided, 
however, that if a change in control of the Corporation shall have occurred 
prior to December 31, 2000, this Agreement shall continue in effect for a period
of 36 months beyond the month in which such change in control occurred, at
which time this Agreement shall terminate.  Notwithstanding the foregoing, and
provided no change in control of the Corporation





Mr. Don R. Graber
October 25, 1995
Page 2




shall have  occurred,  this  Agreement  shall  automatically  terminate upon the
earlier to occur of (i) your termination of employment with the Corporation,  or
(ii) the Corporation's  furnishing you with notice of termination,  irrespective
of the effective date of such termination.

          2. Change in Control.  No benefits shall be payable  hereunder  unless
there  shall  have been a change in  control  of the  Corporation,  as set forth
below. For purposes of this Agreement,  a "change in control of the Corporation"
shall mean a change in control of a nature that would be required to be reported
in response to Item 6(e) of Schedule 14A of Regulation l4A promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), whether or not
the Corporation is in fact required to comply therewith,  provided that, without
limitation, such a change in control shall be deemed to have occurred if (A) any
"person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act),
other than a trustee or other  fiduciary  holding  securities  under an employee
benefit plan of the  Corporation  or any of its  subsidiaries  or a  corporation
owned,  directly  or  indirectly,  by the  stockholders  of the  Corporation  in
substantially   the  same  proportions  as  their  ownership  of  stock  of  the
Corporation,  is or becomes  the  "beneficial  owner" (as  defined in Rule 13d-3
under  the  Exchange  Act),  directly  or  indirectly,   of  securities  of  the
Corporation  representing  20% or  more  of the  combined  voting  power  of the
Corporation's  then  outstanding  securities;  (B)  during  any  period  of  two
consecutive  years,  individuals who at the beginning of such period  constitute
the Board and any new director (other than a director designated by a person who
has entered  into an  agreement  with the  Corporation  to effect a  transaction
described in clauses (A) or (D) of this Section)  whose election by the Board or
nomination for election by the Corporation's stockholders 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  a
majority thereof; (C) the Corporation enters into an agreement, the consummation
of  which  would  result  in  the  occurrence  of a  change  in  control  of the
Corporation;  or (D) the stockholders of the Corporation approve a merger, share
exchange or consolidation of the Corporation with any other  corporation,  other
than a merger,  share exchange or consolidation which would result in the voting
securities of the Corporation  outstanding  immediately prior thereto continuing
to represent (either by remaining  outstanding or by being converted into voting
securities of the surviving entity) at least 60% of the combined voting power of
the voting  securities of the Corporation or such surviving  entity  outstanding
immediately  after  such  merger,  share  exchange  or  consolidation,   or  the
stockholders of the Corporation approve a plan of complete liquidation of the





Mr. Don R. Graber
October 25, 1995
Page 3




Corporation or an agreement for the sale or  disposition  by the  Corporation of
all or substantially all the Corporation's assets.

          3. Termination Following Change in Control of the Corporation.  If any
of the events described in Section 2 hereof  constituting a change in control of
the  Corporation  shall have  occurred,  you shall be entitled  to the  benefits
provided in Subsection  4(iii) hereof upon the  subsequent  termination  of your
employment  during the term of this  Agreement  unless such  termination  is (A)
because of your death,  Disability or  Retirement,  (B) by the  Corporation  for
Cause, or (C) by you other than for Good Reason.

                         (i)        Disability; Retirement.  If, as a result of
your  incapacity due to physical or mental  illness,  you shall have been absent
from the  full-time  performance  of your  duties with the  Corporation  for six
consecutive  months,  and within 30 days after written  notice of termination is
given you shall not have returned to the full-time  performance  of your duties,
your  employment  may  be  terminated  for  "Disability."   Termination  by  the
Corporation  or  you  of  your  employment  based  on  "Retirement"  shall  mean
retirement from active employment with the right to receive an immediate pension
benefit under the applicable  pension plan of the Corporation in accordance with
the  Corporation's  retirement  policy in  effect  at the time of the  change in
control of the Corporation.

                        (ii)        Cause.  Termination by the Corporation of
your  employment  for "Cause"  shall mean  termination  upon (A) the willful and
continued  failure  by  you  to  substantially  perform  your  duties  with  the
Corporation,  other than any such failure  resulting from your incapacity due to
physical or mental illness or any such actual or  anticipated  failure after the
issuance  by you of a Notice of  Termination  (as  defined in  Subsection  3(iv)
hereof)  for Good  Reason (as  defined in  Subsection  3(iii)  hereof),  after a
written  demand for  substantial  performance  is delivered to you by the Board,
which demand specifically identifies the manner in which the Board believes that
you have not substantially performed your duties, or (B) the willful engaging by
you  in  conduct  which  is  demonstrably   and  materially   injurious  to  the
Corporation, monetarily or otherwise. For purposes of this Subsection, 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  Corporation.  Notwithstanding  the
foregoing,  you shall not be deemed to have been terminated for Cause unless and
until there shall have been delivered to you a copy of a resolution duly adopted
by the affirmative vote of not less than three-quarters of the entire membership
of the Board at a meeting of the Board called and held





Mr. Don R. Graber
October 25, 1995
Page 4




for such purpose (after  reasonable  notice to you and an  opportunity  for you,
together with your counsel,  to be heard before the Board),  finding that in the
good faith  opinion of the Board you were  guilty of conduct  set forth above in
clauses (A) or (B) of the first  sentence of this  Subsection and specifying the
particulars thereof in detail.

                       (iii)        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 after a
change in  control  of the  Corporation  of any of the  following  circumstances
unless, in the case of paragraphs (A), (E), (F), (G) or (H), such  circumstances
are fully corrected prior to the Date of Termination  specified in the Notice of
Termination,  as such terms are defined in  Subsections  3(v) and 3(iv)  hereof,
respectively, given in respect thereof:

                           (A) the assignment to you of any duties  inconsistent
         with  your  current  status as an  executive  of the  Corporation  or a
         substantial  adverse  alteration  in  the  nature  or  status  of  your
         responsibilities  from those in effect  immediately prior to the change
         in control of the Corporation;

                           (B) a  reduction  by the  Corporation  in your annual
         base  salary  as in  effect  on the date  hereof  or as the same may be
         increased  from  time  to  time,  except  for  across-the-board  salary
         reductions similarly affecting all senior executives of the Corporation
         and all senior executives of any person in control of the Corporation;

                           (C) your relocation to a location not within 25 miles
         of your present office or job location,  except for required  travel on
         the Corporation's  business to an extent substantially  consistent with
         your present business travel obligations;

                           (D) the  failure  by the  Corporation,  without  your
         consent, to pay to you any portion of your current compensation,  or to
         pay to you any portion of an installment of deferred compensation under
         any deferred compensation program of the Corporation, within seven days
         of the date such compensation is due;

                           (E) the  failure by the  Corporation  to  continue in
         effect any bonus to which you were entitled,  or any compensation  plan
         in which you participated immediately prior to the change in control of
         the Corporation which is material to your total compensation, including
         but not limited to the





Mr. Don R. Graber
October 25, 1995
Page 5




         Corporation's  (i)  Annual  Incentive  Plan  ("AIP")  or  other  annual
         incentive  compensation  plan; (ii) Performance  Equity Plan ("PEP") or
         other long-term incentive  compensation plan; (iii) stock option plans;
         (iv)  retirement  plans;  (v)  Supplemental  Executive  Retirement Plan
         ("SERP");  and  (vi)  Executive  Deferred  Compensation  Plan;  or  any
         substitute  plan or plans adopted prior to the change in control of the
         Corporation,  unless an equitable  arrangement  (embodied in an ongoing
         substitute or alternative plan) has been made with respect to such plan
         and  such  equitable  arrangement  provides  substantially   equivalent
         benefits  not  materially  less  favorable to you (both in terms of the
         amount  of  benefits  provided  and the  level  of  your  participation
         relative to other  participants),  or the failure by the Corporation to
         continue  your   participation   therein  (or  in  such  substitute  or
         alternative  plan) on a basis not materially  less  favorable  (both in
         terms  of the  amount  of  benefits  provided  and  the  level  of your
         participation relative to other participants) as existed at the time of
         the change in control of the Corporation;

                           (F) the  failure by the  Corporation  to  continue to
         provide you with benefits substantially similar to those enjoyed by you
         under any of the Corporation's life insurance,  medical, dental, health
         and accident,  or disability  plans in which you were  participating at
         the time of the change in control of the  Corporation,  the  failure to
         continue to provide you with a  Corporation  automobile or allowance in
         lieu thereof, if you were provided with such an automobile or allowance
         in  lieu  thereof  at  the  time  of  the  change  in  control  of  the
         Corporation,  the taking of any action by the  Corporation  which would
         directly  or  indirectly  materially  reduce  any of such  benefits  or
         deprive you of any material  fringe benefit  enjoyed by you at the time
         of the  change in  control of the  Corporation,  or the  failure by the
         Corporation  to provide  you with the number of paid  vacation  days to
         which  you are  entitled  on the  basis of years  of  service  with the
         Corporation in accordance with the Corporation's normal vacation policy
         in effect at the time of the change in control of the Corporation;

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

                           (H) any  purported  termination  of  your  employment
         which is not effected  pursuant to a Notice of  Termination  satisfying
         the  requirements of Subsection  3(iv) hereof (and, if applicable,  the
         requirements of Subsection 3(ii) hereof);





Mr. Don R. Graber
October 25, 1995
Page 6




         for purposes of this Agreement, no such purported termination shall be
         effective.

Your rights to terminate your employment  pursuant to this Subsection  shall not
be affected by your incapacity due to physical or mental illness. Your continued
employment  shall not constitute  consent to, or a waiver of rights with respect
to, any circumstance constituting Good Reason hereunder.

                        (iv)        Notice of Termination.  Any purported
termination  of  your   employment  by  the  Corporation  or  by  you  shall  be
communicated  by written  Notice of  Termination  to the other  party  hereto in
accordance with Section 6 hereof.  For purposes of this Agreement,  a "Notice of
Termination"  shall mean a notice which 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 provision so indicated.

                         (v)        Date of Termination, Etc.  "Date of
Termination" shall mean (A) if your employment is terminated for Disability,  30
days after  Notice of  Termination  is given  (provided  that you shall not have
returned to the full-time performance of your duties during such 30-day period),
and (B) if your employment is terminated pursuant to Subsections 3(ii) or 3(iii)
hereof or for any other reason (other than  Disability),  the date  specified in
the Notice of  Termination  (which,  in the case of a  termination  pursuant  to
Subsection  3(ii)  hereof  shall not be less than 30 days,  and in the case of a
termination  pursuant to Subsection  3(iii) hereof shall not be less than l5 nor
more than 60 days,  respectively,  from the date such Notice of  Termination  is
given);  provided  that if within l5 days  after any  Notice of  Termination  is
given,  or, if later,  prior to the Date of Termination  (as determined  without
regard to this proviso), the party receiving such Notice of Termination notifies
the other party that a dispute exists  concerning the  termination,  the Date of
Termination shall be the date on which the dispute is finally determined, either
by mutual written agreement of the parties,  by a binding  arbitration award, or
by a final judgment, order or decree of a court of competent jurisdiction (which
is not  appealable  or with respect to which the time for appeal  therefrom  has
expired and no appeal has been  perfected);  provided  further  that the Date of
Termination  shall be  extended  by a notice of dispute  only if such  notice is
given in good faith and the party giving such notice  pursues the  resolution of
such dispute with reasonable diligence. Notwithstanding the pendency of any such
dispute,  the  Corporation  will continue to pay you your full  compensation  in
effect when the notice giving rise to the dispute was given (including,  but not
limited to, base salary) and continue you as a participant in all  compensation,
benefit and





Mr. Don R. Graber
October 25, 1995
Page 7




insurance plans in which you were  participating  when the notice giving rise to
the dispute was given,  until the dispute is finally resolved in accordance with
this Subsection. Amounts paid under this Subsection are in addition to all other
amounts due under this  Agreement and shall not be offset  against or reduce any
other amounts due under this Agreement.

          4.      Compensation Upon Termination or During Disability. Following 
a change in control of the Corporation, as defined by Section 2 hereof, upon 
termination of your employment or during a period of Disability you shall be 
entitled to the following benefits:

                         (i)        During any period that you fail to perform
your  full-time  duties with the  Corporation  as a result of incapacity  due to
physical or mental  illness,  you shall  continue to receive your base salary at
the rate in effect at the  commencement  of any such period,  together  with all
amounts payable to you under any  compensation  plan of the  Corporation  during
such period,  until this  Agreement is terminated  pursuant to  Subsection  3(i)
hereof.  Thereafter,  or in the event your employment shall be terminated by the
Corporation or by you for Retirement,  or by reason of your death, your benefits
shall be  determined  under the  Corporation's  retirement,  insurance and other
compensation  programs  then in  effect  in  accordance  with the  terms of such
programs.

                        (ii)       If your employment shall be terminated by the
Corporation for Cause, Disability, death or Retirement, or by you other than for
Good Reason,  the  Corporation  shall pay you your full base salary  through the
Date of  Termination  at the rate in effect at the time Notice of Termination is
given,  plus all other amounts to which you are entitled under any  compensation
plan of the  Corporation at the time such payments are due, and the  Corporation
shall have no further obligations to you under this Agreement.

                       (iii)        If your employment by the Corporation shall
be terminated (a) by the Corporation other than for Cause, Disability,  death or
Retirement  or (b) by you for Good  Reason,  then you shall be  entitled  to the
benefits provided below:

                           (A) The  Corporation  shall  pay you your  full  base
         salary  through  the Date of  Termination  at the rate in effect at the
         time Notice of  Termination  is given,  plus all other amounts to which
         you are entitled under any compensation plan of the Corporation, at the
         time such payments are due, except as otherwise provided below.

                           (B) In lieu of any further salary payments to you





Mr. Don R. Graber
October 25, 1995
Page 8




         for periods  subsequent  to the Date of  Termination,  the  Corporation
         shall  pay  as  severance  pay  to you a  lump  sum  severance  payment
         (together  with  the  payments   provided  in  paragraph  (C)  of  this
         Subsection 4(iii),  the "Severance  Payments") equal to three times the
         sum of your (a) annual base salary in effect  immediately  prior to the
         occurrence of the circumstance giving rise to the Notice of Termination
         given in respect  thereof,  and (b) AIP Maximum Payment for the year in
         which the Date of Termination  occurs.  AIP Maximum  Payment shall mean
         the higher of (1) the award you would be  entitled  to receive for 1995
         based on the maximum payout factor for the AIP or (2) any greater award
         you would be entitled to receive for any subsequent year (including the
         year in which  your  employment  is  terminated)  based on the  maximum
         payout factor for the AIP for such  subsequent  year. The provisions of
         this  Section  4(iii)(B)  shall not in any way affect your rights under
         the Corporation's stock option plans or the PEP.

                           (C) The  Corporation  shall  pay to you any  deferred
         compensation, including but not limited to deferred bonuses and amounts
         deferred under the Executive Deferred  Compensation Plan,  allocated or
         credited to you or your account as of the Date of Termination.

                           (D) The  Corporation  shall also pay to you all legal
         fees  and  expenses  incurred  by you as a result  of such  termination
         (including all such fees and expenses,  if any,  incurred in contesting
         or disputing  any such  termination  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  Section  4999 of the Code to any  payment  or  benefit
         provided hereunder).

                           (E) If the payments provided under paragraphs (B) and
         (C) above (the  "Contract  Payments") or any other portion of the Total
         Payments  (as  defined  below)  will be subject  to the tax  imposed by
         Section 4999 of the Code (the "Excise Tax"), the Corporation  shall pay
         to you at the time  specified in  paragraph  (F) below,  an  additional
         amount (the "Gross-Up  Payment")  such that the net amount  retained by
         you, after deduction of any Excise Tax on the Contract Payment and such
         other Total Payments and any federal and state and local income tax and
         Excise Tax upon the payment  provided for by this  paragraph,  shall be
         equal to the  Contract  Payments  and such other  Total  Payments.  For
         purposes of determining  whether any of the payments will be subject to
         the  Excise  Tax and the  amount  of such  Excise  Tax,  (i) any  other
         payments  or benefits  received or to be received by you in  connection
         with a change in  control of the  Corporation  or your  termination  of
         employment  (whether payable pursuant to the terms of this Agreement or
         any other





Mr. Don R. Graber
October 25, 1995
Page 9




         plan,  arrangement or agreement with the  Corporation,  its successors,
         any  person  whose  actions  result  in a  change  in  control  of  the
         Corporation or any corporation affiliated (or which, as a result of the
         completion  of a  transaction  causing  a  change  in  control  of  the
         Corporation,  will become  affiliated) with the Corporation  within the
         meaning  of  Section  1504 of the  Code)  (together  with the  Contract
         Payments,   the  "Total  Payments")  shall  be  treated  as  "parachute
         payments" within the meaning of Section 280G(b)(2) of the Code, and all
         "excess  parachute  payments" within the meaning of Section  280G(b)(1)
         shall be treated as subject to the Excise Tax, unless in the opinion of
         tax counsel  selected by the  Corporation's  independent  auditors  and
         acceptable  to you the  Total  Payments  (in  whole  or in part) do not
         constitute  parachute  payments,  or such excess parachute payments (in
         whole  or in  part)  represent  reasonable  compensation  for  services
         actually  rendered within the meaning of Section  280G(b)(4)(B)  of the
         Code either to the extent such reasonable  compensation is in excess of
         the base amount  within the meaning of Section  280G(b)(3) of the Code,
         or are  otherwise not subject to the Excise Tax, (ii) the amount of the
         Total Payments that shall be treated as subject to the Excise Tax shall
         be equal to the lesser of (A) the total amount of the Total Payments or
         (B) the  amount of excess  parachute  payments  within  the  meaning of
         Section  280G(b)(1)  (after applying clause (i), above),  and (iii) the
         value of any non-cash  benefits or any  deferred  payment or benefit as
         determined by the Corporation's independent auditors in accordance with
         the principles of Sections 280G(d)(3) and (4) of the Code. For purposes
         of determining the amount of the Gross-Up Payment,  you shall be deemed
         to pay federal  income  taxes at the highest  marginal  rate of federal
         income  taxation in the calendar year in which the Gross-Up  Payment is
         to be made and state and local  income  taxes at the  highest  marginal
         rate of taxation in the state and  locality  of your  residence  on the
         Date of  Termination,  net of the maximum  reduction in federal  income
         taxes which could be obtained  from  deduction  of such state and local
         taxes. In the event that the Excise Tax is  subsequently  determined to
         be less than the amount  taken into  account  hereunder  at the time of
         termination of your  employment,  you shall repay to the Corporation at
         the time that the  amount of such  reduction  in Excise  Tax is finally
         determined  the portion of the Gross-Up  Payment  attributable  to such
         reduction (plus the portion of the Gross-Up Payment attributable to the
         Excise Tax and  federal  and state and local  income tax imposed on the
         Gross-Up  Payment  being repaid by you if such  repayment  results in a
         reduction in Excise Tax and/or a federal and state and local income tax
         deduction)  plus  interest on the amount of such  repayment at the rate
         provided in Section  1274(d) of the Code.  In the event that the Excise
         Tax is determined to exceed the amount taken into account  hereunder at
         the time of the termination of your





Mr. Don R. Graber
October 25, 1995
Page 10




         employment  (including by reason of any payment the existence or amount
         of which cannot be determined at the time of the Gross-Up Payment), the
         Corporation  shall make an  additional  Gross-Up  Payment in respect of
         such excess (plus any interest  payable with respect to such excess) at
         the time that the amount of such excess is finally determined.

                           (F) The payments  provided for in paragraphs (B), (C)
         and (E) above, shall be made not later than the fifth day following the
         Date of  Termination,  provided,  however,  that if the amounts of such
         payments  cannot  be  finally  determined  on or before  such day,  the
         Corporation shall pay to you on such day an estimate,  as determined in
         good faith by the  Corporation,  of the minimum amount of such payments
         and shall pay the remainder of such payments (together with interest at
         a rate equal to 120% of the rate  provided  in  Section  1274(d) of the
         Code) as soon as the amount  thereof can be determined  but in no event
         later  than the  thirtieth  day after the Date of  Termination.  In the
         event  that the amount of the  estimated  payments  exceeds  the amount
         subsequently  determined to have been due, such excess shall constitute
         a loan by the  Corporation to you payable on the fifth day after demand
         by the  Corporation  (together with interest at a rate equal to 120% of
         the rate  provided  in  Section  1274(d)  of the  Code).  The  payments
         provided for in paragraph (D) above shall be made from time to time, in
         each instance not later than the fifth day following a written  request
         for payment by you.

                        (iv)       If your employment shall be terminated (A) by
the Corporation other than for Cause, Disability,  death or Retirement or (B) by
you for Good  Reason,  then for a 36-month  period after such  termination,  the
Corporation  shall  arrange to  provide  you with  life,  disability,  accident,
medical,  dental and health insurance  benefits  substantially  similar to those
that you are receiving immediately prior to the Notice of Termination.  Benefits
otherwise  receivable by you pursuant to this Subsection  4(iv) shall be reduced
to the extent  comparable  benefits  are  actually  received by you from another
employer during the 36- month period  following your  termination,  and any such
benefits actually received by you shall be reported to the Corporation.

                         (v)        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 or benefit  provided  for in
this  Section 4 be  reduced by any  compensation  earned by you as the result of
employment by another employer,  by retirement  benefits,  by offset against any
amount  claimed to be owed by you to the  Corporation,  or  otherwise  except as
specifically provided in this Section 4.

                        (vi)        In addition to all other amounts payable to
you under this Section 4, you shall be entitled to receive all





Mr. Don R. Graber
October 25, 1995
Page 11




benefits payable to you under The Black & Decker  Executive  Salary  Continuance
Plan, the SERP, or any plan or agreement  sponsored by the Corporation or any of
its subsidiaries relating to retirement benefits.

          5.      Successors; Binding Agreement.

                         (i)        The Corporation will require any successor
(whether direct or indirect, by purchase, merger, share exchange,  consolidation
or otherwise) to all or  substantially  all of the business and/or assets of the
Corporation to assume  expressly and agree to perform this Agreement in the same
manner and to the same extent that the Corporation  would be required to perform
it if no such  succession had taken place.  Failure of the Corporation 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  Corporation  in the  same  amount  and on the same  terms  as you  would be
entitled to hereunder if you terminate your employment for Good Reason following
a change in control of the Corporation, except that for purposes of implementing
the foregoing,  the date on which any such succession becomes effective shall be
deemed the Date of Termination.  As used in this Agreement,  "Corporation" shall
mean the Corporation as  hereinbefore  defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.

                        (ii)        This Agreement shall inure to the benefit of
and be  enforceable  by  your  personal  or  legal  representatives,  executors,
administrators,  heirs, distributees,  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 legatee or other designee or, if there is no
such designee, to your estate.

                       (iii)        In the event that you are employed by a
subsidiary of the Corporation,  wherever in this Agreement  reference is made to
the "Corporation,"  unless the context otherwise requires,  such reference shall
also include such  subsidiary.  The  Corporation  shall cause such subsidiary to
carry out the terms of this  Agreement  insofar as they relate to the employment
relationship  between  you  and  such  subsidiary,  and  the  Corporation  shall
indemnify  you and save you harmless  from and against all  liability and damage
you may suffer as a  consequence  of such  subsidiary's  failure to perform  and
carry out such terms.  Wherever  reference is made to any benefit program of the
Corporation,  such reference shall include, where appropriate, the corresponding
benefit  program of such  subsidiary if you were a  participant  in such benefit
program on the date a change in control of the Corporation has occurred.






Mr. Don R. Graber
October 25, 1995
Page 12




          6. Notice.  For the purpose of this  Agreement,  notices and all other
communications  provided for in the  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,  provided
that all notices to the  Corporation  shall be directed to the  attention of the
Board with a copy to the Secretary of the Corporation,  or to such other address
as  either  party  may have  furnished  to the other in  writing  in  accordance
herewith,  except that notice of change of address shall be effective  only upon
receipt.

          7.  Miscellaneous.  This  Agreement  amends and restates the agreement
between the parties dated  October 18, 1990. 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.  No waiver by either party hereto at any
time of any  breach by the  other  party  hereto  of, or  compliance  with,  any
condition  or  provision  of this  Agreement to be performed by such other party
shall be deemed a waiver of similar or  dissimilar  provisions  or conditions at
the same or at any prior or subsequent  time. No agreements or  representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have  been  made by  either  party  which  are not  expressly  set forth in this
Agreement.  The validity,  interpretation,  construction and performance of this
Agreement shall be governed by the laws of the State of Maryland. All references
to sections of the Exchange Act or the Code shall be deemed also to refer to any
successor provisions to such sections. Any payments provided for hereunder shall
be paid net of any applicable withholding required under federal, state or local
law. The obligations of the Corporation under Section 4 hereof shall survive the
expiration of the term of this Agreement.

          8.      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.

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

         10.  Arbitration.  Any  dispute  or  controversy  arising  under  or in
connection  with this Agreement  shall be settled  exclusively by arbitration in
the State of Maryland,  in accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award in
any court having jurisdiction;  provided, however, that you shall be entitled to
seek specific performance of your right to be paid





Mr. Don R. Graber
October 25, 1995
Page 13



until the Date of Termination  during the pendency of any dispute or controversy
arising under or in connection with this Agreement.

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

                                         Sincerely,

                                         THE BLACK & DECKER CORPORATION


                                         By /s/ NOLAN D. ARCHIBALD
                                            Nolan D. Archibald
                                            Chairman, President and
                                            Chief Executive Officer




Agreed to this 18th day of
November 1995


/S/  DON R. GRABER
Don R. Graber