AMENDMENT NO.1 TO
                          EXECUTIVE SEVERANCE AGREEMENT


     THIS  AMENDMENT  NO. 1 to the  Executive  Severance  Agreement  dated as of
February 20, 1998 ("Agreement")  between JPE, Inc.  ("Corporation") and Donna L.
Bacon ("Executive") is made as of this 21st day of May, 1998.

     WHEREAS,  Executive is presently  employed by the Corporation as President,
General Counsel and Secretary; and

     WHEREAS,  the Board of Directors  ("Board")  recognizes  that Executive has
contributed significantly to the effort of selling the Corporation or all of its
businesses separately ("Sale"); and

     WHEREAS, the Board wishes to compensate Executive for her contributions and
to provide  adequate  incentive  for  Executive  to remain with the  Corporation
through the completion of the Sale.

     NOW, THEREFORE, Executive and the Corporation agree to amend the Agreement,
as follows:

     1. Lines 5 and 6 of Section  2.(b)(i)  are hereby  amended by deleting  the
words "(not including the securities  beneficially owned by such Person acquired
directly from the Corporation or its affiliates) representing 25%" and inserting
in lieu thereof the words "representing 15%".

     2. Section  2.(d) is hereby  deleted in its entirety and replaced  with the
following:

          "Severance Payment Upon Change of Control. Upon completion of a Change
     of Control,  the Corporation shall pay Executive a bonus equal to 1.5 times
     the Executive's  annual base salary (the "Base Salary"),  which base salary
     shall not be less than Executive's annual base salary of $185,000 as of the
     date of this Agreement.  Further,  the Corporation shall make an additional
     payment to  Executive  of 1.49  times the  Executive's  Base  Salary on the
     earlier to occur of (i) the selling shareholders of the common stock of the
     Corporation  (the  "Shares")  receiving  aggregate  compensation  for their
     Shares as a result of the Sale,  equal to at least $3.00 per share and (ii)
     if at any time  within  the two (2) years  after a Change of  Control,  the
     Executive's  employment  with  the  Corporation  (x) is  terminated  by the
     Corporation  for any reason  other than her  death,  Permanent  Disability,
     voluntary  retirement on or after age sixty-five  (65), or Termination  For
     Cause,  or (y) is terminated by the Executive for Good Reason (as hereafter
     defined)."

     3. The first sentence in Section 2.(f)(i) is hereby amended by deleting the
phrase "the  Severance  Payment  provided in Section 2(d)" and inserting in lieu
thereof "a severance payment equal to 2.99 times the Executive's Base Salary".

     4. The penultimate and last line of Section 2.(f)(ii)( C) is hereby amended
by deleting the words "or its affiliates".

     For the  purposes  of this  Amendment,  defined  terms  shall have the same
meaning  as those  contained  in the  Agreement.  Except as  otherwise  provided
herein,  all other terms and  conditions  of the Agreement are unchanged by this
Amendment and shall remain in full force and effect.

     IN WITNESS  WHEREOF,  the parties  have duly  executed and  delivered  this
Amendment as of the day and year first above written.

                                    JPE, INC.

                                    By: /s/ John Psarouthakis
                                        ------------------------------------
                                        John Psarouthakis
                                        Chairman



                                    EXECUTIVE

                                    By: /s/ Donna L. Bacon
                                        ------------------------------------
                                        Donna L. Bacon