Document:

Exhibit 10.3

 

Employment Agreement of Christopher J. Kearney

 

This Employment Agreement (the “Agreement”) is
effective as of February 23, 2005 (the “Effective Date”), by and between SPX
Corporation (the “Company”), and Christopher J. Kearney (the “Executive”).

 

WHEREAS, the Company desires to continue to employ the
Executive as its President and Chief Executive Officer; and

 

WHEREAS, the Company and the Executive have reached
agreement concerning the terms and conditions of his continued employment and
wish to formalize that agreement;

 

NOW, THEREFORE, in consideration of the mutual terms,
covenants and conditions stated in this Agreement, the Company and the
Executive hereby agree as follows:

 

1.             Employment.  The Company employs the Executive and the
Executive hereby accepts continued employment with the Company as President and
Chief Executive Officer.  During the
Employment Term (as hereinafter defined), the Executive will have the title,
status and duties of President and Chief Executive Officer and will report
directly to the Company’s Board of Directors. 
The Executive’s principal business office shall be at the Company’s
principal business office located in Charlotte, North Carolina, and Executive’s
principal family residence shall be located within 50 miles of the Company’s
principal business office for the duration of the Employment Term.   If domiciled elsewhere on the date of
Executive’s execution of this Agreement, Executive shall relocate his principal
family residence to the area specified in this Paragraph.  Executive’s failure to complete such
relocation on or before July 15, 2005 shall render this Agreement null and
void.

 

2.             Term of Employment.  The term of employment (“Employment Term”)
will commence on the Effective Date, and will continue thereafter until two (2)
years from the Effective Date and will be automatically extended for subsequent
one (1) day periods for each day of the Employment Term that passes after the
Effective Date, unless sooner terminated by either party in accordance with the
provisions of this Agreement.  The intent
of the foregoing provision is that the Agreement becomes “evergreen” on the
Effective Date so that on each passing day after the Effective Date the
Employment Term automatically extends to a full two-year period.

 

3.             Duties.  During the Employment Term:

 

(a)           The
Executive will perform duties assigned by the Company’s Board of Directors (the
“Board”), from time to time; provided that the Executive shall not be assigned
tasks inconsistent with those of President and Chief Executive Officer.

 

(b)           The
Executive will devote his full time and best efforts, talents, knowledge and
experience to serving as the Company’s President and Chief Executive
Officer.  However, the Executive may
devote reasonable time to activities such as 

 

 

supervision
of personal investments and activities involving professional, charitable,
educational, religious and similar types of activities, speaking engagements
and membership on other boards of directors, provided such activities do not interfere
in any material way with the business of the Company; provided  that,
the Executive cannot serve on the board of directors of more than one
publicly-traded company without the Board’s written consent.  The time involved in such activities shall not
be treated as vacation time.  The
Executive shall be entitled to keep any amounts paid to him in connection with
such activities (e.g., director fees and
honoraria).

 

(c)           The
Executive will perform his duties diligently and competently and shall act in conformity
with the Company’s written and oral policies and within the limits, budgets and
business plans set by the Company.  The
Executive will at all times during the Employment Term strictly adhere to and
obey all of the rules and regulations in effect from time to time relating to
the conduct of executives of the Company. 
Except as provided in (b) above, the Executive shall not engage in
consulting work or any trade or business for his own account or for or on behalf
of any other person, firm or company that competes, conflicts or interferes
with the performance of his duties hereunder in any material way.

 

4.             Compensation and Benefits.  During the Executive’s employment hereunder,
the Company shall provide to the Executive, and the Executive shall accept from
the Company as full compensation for the Executive’s services hereunder,
compensation and benefits as follows:

 

(a)           Base
Salary.  The Company shall pay the
Executive at an annual base salary (“Base Salary”) of eight hundred,
seventy-five thousand dollars ($875,000). 
The Board, or such committee of the Board as is responsible for setting
the compensation of senior executive officers, shall review the Executive’s
performance and Base Salary annually in January of each year, and determine
whether to adjust the Executive’s Base Salary on a prospective basis.  The first review shall be in January
2006.  Such adjusted annual salary then
shall become the Executive’s “Base Salary” for purposes of this Agreement.  The Executive’s annual Base Salary shall not
be reduced after any increase, without the Executive’s consent.  The Company shall pay the Executive’s Base
Salary according to payroll practices in effect for all senior executive
officers of the Company.

 

(b)           Incentive
Compensation.  The Executive shall be
eligible to participate in any annual performance bonus plans, long-term
incentive plans, and/or equity-based compensation plans established or
maintained by the Company for its senior executive officers, including, but not
limited to, the Executive EVA Compensation Plan (“EVA Plan”) and the SPX
Corporation Stock Compensation Plan.  For
the 2005 bonus plan year, the Executive shall be eligible for a target bonus
under the Company’s EVA Plan equal to 100% of his Base Salary provided that all
performance goals set by the Company are met. 
The Board (or appropriate Board committee) will determine and
communicate to the Executive his annual incentive plan participation for
subsequent bonus plan years, no later than March 31 of such bonus plan year.

 

(c)           Executive
Benefit Plans.  The Executive will be
eligible to participate on substantially the same basis as the Company’s other
senior executive officers in any

2

 

executive
benefit plans offered by the Company including, without limitation, medical,
dental, short-term and long-term disability, life, pension, profit sharing and
nonqualified deferred compensation arrangements.  The Company reserves the right to modify,
suspend or discontinue any and all of the plans, practices, policies and
programs at any time without recourse by the Executive, so long as the Company
takes such action generally with respect to other similarly situated senior
executive officers.

 

(d)           Business
Expenses.  The Company shall
reimburse the Executive for all reasonable and necessary business expenses
incurred in the performance of services with the Company, according to the
Company’s policies and upon Executive’s presentation of an itemized written
statement and such verification as the Company may require.

 

(e)           Perquisites.  The Company will provide the Executive with
all perquisites it provides to other senior executive officers.  Such perquisites shall not be less than those
provided to the Executive on the Effective Date.  The Company will also reimburse the Executive
for annual income tax return preparation and financial planning up to $40,000
per year.

 

(f)            Vacation.  The Executive will be entitled to vacation in
accordance with the Company’s vacation policy for senior executive officers,
but in no event less than 5 weeks per calendar year.  Unused vacation shall be carried over for a
period not in excess of twelve (12) months.

 

5.             Payments on Termination of
Employment.

 

(a)           Termination
of Employment for any Reason.  The
following payments will be made upon the Executive’s termination of employment
for any reason:

 

(i)            Earned
but unpaid Base Salary through the date of termination;

 

(ii)           Any
annual incentive plan bonus, for which the performance measurement period has
ended, but which is unpaid at the time of termination;

 

(iii)          Any
accrued but unpaid vacation;

 

(iv)          Any
amounts payable under any of the Company’s benefit plans in accordance with the
terms of those plans, except as may be required under Code Section 401(a)(13);
and

 

(v)           Unreimbursed
business expenses incurred by the Executive on the Company’s behalf.

 

(b)           Termination
of Employment for Death or Disability. 
In addition to the amounts determined under (a) above, if the Executive’s
termination of employment occurs by reason of death or disability, the
Executive (or his estate) will receive a pro rata portion of any bonus payable
under the Company’s annual incentive plan for the year in which such
termination occurs determined based on the highest of (i) the actual annual
bonus paid for the bonus plan year immediately preceding such termination, or
(ii) the

 

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target
bonus for the bonus plan year in which such termination occurs.  The Executive also will receive the Executive’s
bonus bank amount, if positive, as of the date of such termination.  The
Executive will be deemed to be disabled upon the earlier of (i) the end of a
six (6) consecutive month period during which, by reason of physical or mental
injury or disease, the Executive has been unable to perform substantially all
of his usual and customary duties under this Agreement or (ii) the date that a
reputable physician selected by the Board, and as to whom the Executive has no
reasonable objection, determines in writing that the Executive will, by reason
of physical or mental injury or disease, be unable to perform substantially all
of the Executive’s usual and customary duties under this Agreement for a period
of at least six (6) consecutive months. 
If any question arises as to whether the Executive is disabled, upon
reasonable request therefore by the Board, the Executive shall submit to
reasonable medical examination for the purpose of determining the existence,
nature and extent of any such disability. 
In accordance with Paragraph 10, the Board shall promptly give the
Executive written notice of any such determination of the Executive’s
disability and of any decision of the Board to terminate the Executive’s
employment by reason thereof.  In the
event of disability, until the date of termination, the base salary payable to
the Executive under Paragraph 4 hereof shall be reduced dollar-for-dollar by
the amount of disability benefits paid to the Executive in accordance with any
disability policy or program of the Corporation.

 

(c)           Termination
by the Company Without Cause, or Voluntary Termination by the Executive for
Good Reason.  If the Company
terminates the Executive’s employment other than for Cause, or the Executive
voluntarily terminates his employment for Good Reason, in addition to the
benefits payable under (a), the Company will pay the following amounts and
provide the following benefits:

 

(i)            The
Base Salary and annual bonus that the Company would have paid under the
Agreement had the Executive’s employment continued to the end of the Employment
Term.  For this purpose, annual bonus
will be determined as the highest of (A) the actual bonus paid for the bonus
plan year immediately preceding such termination, or (B) the target bonus for
the bonus plan year in which such termination occurs.

 

(ii)           Continued
coverage under the Company’s medical, dental, life, disability, pension, profit
sharing and other executive benefit plans through the end of the Employment
Term, at the same cost to the Executive as in effect on the date of the
Executive’s termination.  If the Company
determines that the Executive cannot participate in any benefit plan because he
is not actively performing services for the Company, the Company may provide
such benefits under an alternate arrangement, such as through the purchase of
an individual insurance policy that provides similar benefits or, if
applicable, through a nonqualified pension or profit sharing plan.  To the extent that the Executive’s
compensation is necessary for determining the amount of any such continued
coverage or benefits, such compensation (Base Salary and annual bonus) through
the end of the Employment Term shall be at the highest rate in effect during
the

 

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12-month
period immediately preceding the Executive’s termination of employment.

 

(iii)          Executive
perquisites on the same basis on which the Executive was receiving such
perquisites prior to his employment termination, including: (A) reimbursement
for club dues through the end of the Employment Term; and (B) reimbursement of
expenses relating to financial planning services, tax return preparation and
annual physicals through December 31 of the calendar year that includes the
second anniversary of the Executive’s employment termination.  The Company will bear the cost of such
perquisites, at the same level in effect immediately prior to the Executive’s
employment termination.  Perquisites
otherwise receivable by the Executive pursuant to this Paragraph shall be
reduced to the extent comparable perquisites are actually received by or made
available to the Executive without cost during the period following the
Executive’s employment termination covered by this Paragraph.  The Executive shall report to the Company any
such perquisites actually received by or made available to the Executive.

 

(iv)          The
period through the end of the Employment Term shall continue to count for
purposes of determining the Executive’s age and service with the Company with
respect to eligibility, vesting and the amount of benefits under the Company’s
benefit plans to the maximum extent permitted by applicable law.

 

(v)           Any
outstanding stock options, restricted stock or other equity-based compensation
awards shall immediately vest upon such termination date, and any such stock
options shall be immediately exercisable at any time prior to the earlier
of:  (A) two years; or (B) the stock
option expiration or other termination date.

 

(vi)          The
Executive’s bonus bank amount, if positive, as of the date of such termination.

 

(vii)         Outplacement
services, as elected by the Executive (and with a firm elected by the
Executive), not to exceed $50,000 in total.

 

(d)           Good
Reason.  For purposes of this
Agreement, “Good Reason” shall mean the occurrence of any of the following without
the Executive’s consent (i) assigning duties to the Executive that are
inconsistent with those of the position of President and Chief Executive
Officer for similar companies in similar industries (except to the extent the
Company promotes the Executive to a higher executive position); (ii) requiring
the Executive to report to other than the Company’s Board; (iii) the failure of
the Company to pay any portion of the Executive’s compensation within 10 days
of the date such compensation is due; (iv) the Company requires the Executive
to relocate his principal business office to a location not within 50 miles of
the Company’s principal business office located in the Charlotte, North
Carolina metropolitan area, or (v) the Company’s failure to continue in effect
any cash or stock-based incentive or bonus plan, pension

 

5

 

plan,
welfare benefit plan or other benefit plan, program or arrangement, unless the
aggregate value of all such arrangements provided to the Executive after such
discontinuance is not materially less than the aggregate value as of the
Effective Date (using, for purposes of bonus plan comparisons, the target bonus
potential before and after any such discontinuance).

 

(e)           Cause.  For purposes of this Agreement, “Cause” shall
mean:  (i) the Executive’s willful and
continued failure to substantially perform his duties as an executive of the
Company (other than any such failure resulting from incapacity due to physical
or mental illness) after a written demand for substantial performance is
delivered to the Executive by the Board, which demand specifically identifies
the manner in which the Board believes that the Executive has not substantially
performed his duties, and which gives the Executive at least 30 days to cure
such alleged deficiencies, (ii) the Executive’s willful misconduct, which is
demonstrably and materially injurious to the Company, monetarily or otherwise,
or (iii) the Executive’s engaging in egregious misconduct involving serious moral
turpitude to the extent that his credibility and reputation no longer conforms
to the standard of senior executive officers of the Company.

 

(f)            Timing
of Payments.  All payments described
above shall be made in a lump sum cash payment as soon as practicable (but in
no event more than 10 days unless prohibited by applicable law or plan
documents) following the Executive’s termination of employment.  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.

 

6.             Assignment; Successors.  This Agreement shall inure to the benefit of
and be binding upon the Company and its successors.  The Company may not assign this Agreement
without the Executive’s written consent, except that the Company’s obligations
under this Agreement shall be the binding legal obligations of any successor to
the Company by sale, and in the event of any transaction that results in the
transfer of substantially all of the assets or business of the Company, the
Company will use its best efforts to cause the transferee to assume the
obligations of the Company under this Agreement.  The Executive may not assign this Agreement
during his life.  Upon the Executive’s
death this Agreement will inure to the benefit of the Executive’s heirs,
legatees and legal representatives of the Executive’s estate.

 

7.             Interpretation.  The laws of the State of Delaware shall
govern the validity, interpretation, construction and performance of this
Agreement, without regard to the conflict of laws principles thereof.

 

8.             Withholding.  The Company may withhold from any payment
that it is required to make under this Agreement amounts sufficient to satisfy
applicable withholding requirements under any federal, state or local law.

 

9.             Amendment or Termination.  This Agreement may be amended at any time by
written agreement between the Company and the Executive.

 

6

 

10.           Notices.  Notices given pursuant to this Agreement
shall be in writing and shall be deemed received when personally delivered, or
on the date of written confirmation of receipt by (i) overnight carrier, (ii)
telecopy, (iii) registered or certified mail, return receipt requested,
addressee only, postage prepaid, or (iv) such other method of delivery that
provides a written confirmation of delivery. 
Notice to the Company shall be directed to:

 

SPX
Corporation

13515
Ballantyne Corporate Place

Charlotte,
NC 28277

Attention:
General Counsel

 

The Company may change the person and/or address to
whom the Executive must give notice under this Section by giving the Executive
written notice of such change, in accordance with the procedures described
above.  Notices to or with respect to the
Executive will be directed to the Executive, or to the Executive’s executors,
personal representatives or distributees, if the Executive is deceased, or the
assignees of the Executive, at the Executive’s home address on the records of
the Company.

 

11.           Severability.  If any provisions(s) of this Agreement shall
be found invalid or unenforceable by a court of competent jurisdiction, in
whole or in part, then it is the parties’ mutual desire that such court modify
such provision(s) to the extent and in the manner necessary to render the same
valid and enforceable, and this Agreement shall be construed and enforced to
the maximum extent permitted by law, as if such provision(s) had been
originally incorporated herein as so modified or restricted, or as if such
provision(s) had not been originally incorporated herein, as the case may be.

 

12.           Entire Agreement.  This Agreement sets forth the entire
agreement and understanding between the Company and the Executive and
supersedes all prior agreements and understandings, written or oral, relating
to the subject matter hereof; provided, however, that: (i) the Executive’s
Change in Control Agreement dated May 10, 1999 shall remain in full force and
effect, and payments and benefits provided thereunder shall replace those
provided in this Agreement to the extent that such payments or benefits would
otherwise clearly be duplicative; and (ii) the Executive’s non-compete,
non-solicitation, confidentiality or similar restrictive covenants shall remain
in full force and effect.

 

13.           Consultation With Counsel.  The Executive acknowledges that he has had a
full and complete opportunity to consult with counsel of the Executive’s own
choosing concerning the terms, enforceability and implications of this
Agreement, and the Company has made no representations or warranties to the
Executive concerning the terms, enforceability or implications of this
Agreement other than as are reflected in this Agreement.

 

14.           No Waiver.  No failure or delay by the Company or the
Executive in enforcing or exercising any right or remedy hereunder shall
operate as a waiver thereof.  No
modification, amendment or waiver of this Agreement nor consent to any
departure by the Executive from any of the terms or conditions thereof, shall
be effective unless in writing and signed by the Chairman of the Company’s
Board.  Any such waiver or consent shall
be effective only in the specific instance and for the purpose for which given.

 

7

 

15.           Effect on Other Obligations.  Payments and benefits herein provided to be
paid to the Executive by the Company shall be made without regard to and in
addition to any other payments or benefits required to be paid the Executive at
any time hereafter under the terms of any other agreement between the Executive
and the Company or under any other policy of the Company relating to
compensation, or retirement or other benefits. 
Except as otherwise expressly provided herein, payments or benefits
provided the Executive hereunder shall be reduced by any amount the Executive
may earn or receive from employment with another employer or from any other
source.

 

16.           Survival.  All Sections of this Agreement survive beyond
the Employment Term except as otherwise specifically stated.

 

17.           Headings. 
The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning thereof.

 

18.           Counterparts.  The parties may execute this Agreement in one
or more counterparts, all of which together shall constitute but one Agreement.

 

IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date first above written.

 

	
  EXECUTIVE ACCEPTANCE

  	
  SPX CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Christopher J. Kearney

  	
   

  	
  By:

  	
  /s/ Robert B. Foreman

  	
   

  
	
  Christopher J. Kearney

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  Senior Vice President, Human Resources

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  February 28, 2005

  	
   

  
							

 

8Exhibit 10.4

 

Employment Agreement of Patrick J. O’Leary

 

This Employment Agreement (the “Agreement”) is
effective as of February 23, 2005 (the “Effective Date”), by and between SPX
Corporation (the “Company”), and Patrick J. O’Leary (the “Executive”).

 

WHEREAS, the Company desires to continue to employ the
Executive as its Executive Vice President and Chief Financial Officer; and

 

WHEREAS, the Company and the Executive have reached
agreement concerning the terms and conditions of his continued employment and
wish to formalize that agreement;

 

NOW, THEREFORE, in consideration of the mutual terms,
covenants and conditions stated in this Agreement, the Company and the
Executive hereby agree as follows:

 

1.             Employment.  The Company employs the Executive and the
Executive hereby accepts continued employment with the Company as Executive
Vice President and Chief Financial Officer . 
During the Employment Term (as hereinafter defined), the Executive will
have the title, status and duties of Executive Vice President and Chief
Financial Officer  and will report
directly to the Company’s Chief Executive Officer.  The Executive’s principal business office
shall be at the Company’s principal business office located in Charlotte, North
Carolina, and Executive’s principal family residence shall be located within 50
miles of the Company’s principal business office for the duration of the
Employment Term.   If domiciled elsewhere
on the date of Executive’s execution of this Agreement, Executive shall
relocate his principal family residence to the area specified in this
Paragraph.  Executive’s failure to
complete such relocation on or before July 15, 2005 shall render this Agreement
null and void.

 

2.             Term of Employment.  The term of employment (“Employment Term”)
will commence on the Effective Date, and will continue thereafter until two (2)
years from the Effective Date and will be automatically extended for subsequent
one (1) day periods for each day of the Employment Term that passes after the
Effective Date, unless sooner terminated by either party in accordance with the
provisions of this Agreement.  The intent
of the foregoing provision is that the Agreement becomes “evergreen” on the
Effective Date so that on each passing day after the Effective Date the
Employment Term automatically extends to a full two-year period.

 

3.             Duties.  During the Employment Term:

 

(a)           The
Executive will perform duties assigned by the Company’s Chief Executive
Officer, or the Company’s Board of Directors (the “Board”), from time to time;
provided that the Executive shall not be assigned tasks inconsistent with those
of Executive Vice President and Chief Financial Officer.

 

(b)           The
Executive will devote his full time and best efforts, talents, knowledge and
experience to serving as the Company’s Executive Vice President and

 

 

Chief
Financial Officer.  However, the
Executive may devote reasonable time to activities such as supervision of
personal investments and activities involving professional, charitable,
educational, religious and similar types of activities, speaking engagements
and membership on other boards of directors, provided such activities do not
interfere in any material way with the business of the Company; provided
that, the Executive cannot serve on the board of directors of more than
one publicly-traded company without the Board’s written consent.  The time involved in such activities shall
not be treated as vacation time.  The
Executive shall be entitled to keep any amounts paid to him in connection with
such activities (e.g., director fees and
honoraria).

 

(c)           The
Executive will perform his duties diligently and competently and shall act in
conformity with the Company’s written and oral policies and within the limits,
budgets and business plans set by the Company. 
The Executive will at all times during the Employment Term strictly
adhere to and obey all of the rules and regulations in effect from time to time
relating to the conduct of executives of the Company.  Except as provided in (b) above, the
Executive shall not engage in consulting work or any trade or business for his
own account or for or on behalf of any other person, firm or company that
competes, conflicts or interferes with the performance of his duties hereunder
in any material way.

 

4.             Compensation and Benefits.  During the Executive’s employment hereunder,
the Company shall provide to the Executive, and the Executive shall accept from
the Company as full compensation for the Executive’s services hereunder,
compensation and benefits as follows:

 

(a)           Base
Salary.  The Company shall pay the
Executive at an annual base salary (“Base Salary”) of seven hundred, fifty
thousand dollars ($750,000).  The Board,
or such committee of the Board as is responsible for setting the compensation
of senior executive officers, shall review the Executive’s performance and Base
Salary annually in January of each year, and determine whether to adjust the
Executive’s Base Salary on a prospective basis. 
The first review shall be in January 2006.  Such adjusted annual salary then shall become
the Executive’s “Base Salary” for purposes of this Agreement.  The Executive’s annual Base Salary shall not
be reduced after any increase, without the Executive’s consent.  The Company shall pay the Executive’s Base
Salary according to payroll practices in effect for all senior executive
officers of the Company.

 

(b)           Incentive
Compensation.  The Executive shall be
eligible to participate in any annual performance bonus plans, long-term
incentive plans, and/or equity-based compensation plans established or maintained
by the Company for its senior executive officers, including, but not limited
to, the Executive EVA Compensation Plan (“EVA Plan”) and the SPX Corporation
Stock Compensation Plan.  For the 2005
bonus plan year, the Executive shall be eligible for a target bonus under the
Company’s EVA Plan equal to 100% of his Base Salary provided that all
performance goals set by the Company are met. 
The Board (or appropriate Board committee) will determine and
communicate to the Executive his annual incentive plan participation for
subsequent bonus plan years, no later than March 31 of such bonus plan year.

 

2

 

(c)           Executive
Benefit Plans.  The Executive will be
eligible to participate on substantially the same basis as the Company’s other
senior executive officers in any executive benefit plans offered by the Company
including, without limitation, medical, dental, short-term and long-term
disability, life, pension, profit sharing and nonqualified deferred compensation
arrangements.  The Company reserves the
right to modify, suspend or discontinue any and all of the plans, practices,
policies and programs at any time without recourse by the Executive, so long as
the Company takes such action generally with respect to other similarly
situated senior executive officers.

 

(d)           Business
Expenses.  The Company shall
reimburse the Executive for all reasonable and necessary business expenses
incurred in the performance of services with the Company, according to the
Company’s policies and upon Executive’s presentation of an itemized written
statement and such verification as the Company may require.

 

(e)           Perquisites.  The Company will provide the Executive with
all perquisites it provides to other senior executive officers.  Such perquisites shall not be less than those
provided to the Executive on the Effective Date.  The Company will also reimburse the Executive
for annual income tax return preparation and financial planning up to $20,000
per year.

 

(f)            Vacation.  The Executive will be entitled to vacation in
accordance with the Company’s vacation policy for senior executive officers,
but in no event less than 5 weeks per calendar year.  Unused vacation shall be carried over for a
period not in excess of twelve (12) months.

 

5.             Payments on Termination of
Employment.

 

(a)           Termination
of Employment for any Reason.  The
following payments will be made upon the Executive’s termination of employment
for any reason:

 

(i)            Earned
but unpaid Base Salary through the date of termination;

 

(ii)           Any
annual incentive plan bonus, for which the performance measurement period has
ended, but which is unpaid at the time of termination;

 

(iii)          Any
accrued but unpaid vacation;

 

(iv)          Any
amounts payable under any of the Company’s benefit plans in accordance with the
terms of those plans, except as may be required under Code Section 401(a)(13);
and

 

(v)           Unreimbursed
business expenses incurred by the Executive on the Company’s behalf.

 

(b)           Termination
of Employment for Death or Disability. 
In addition to the amounts determined under (a) above, if the Executive’s
termination of employment occurs by reason of death or disability, the
Executive (or his estate) will receive a pro rata portion of any bonus payable
under the Company’s annual incentive plan for the year in

 

3

 

which
such termination occurs determined based on the highest of (i) the actual
annual bonus paid for the bonus plan year immediately preceding such
termination, or (ii) the target bonus for the bonus plan year in which such
termination occurs.  The Executive also
will receive the Executive’s bonus bank amount, if positive, as of the date of
such termination.  The Executive will be deemed to be
disabled upon the earlier of (i) the end of a six (6) consecutive month period
during which, by reason of physical or mental injury or disease, the Executive
has been unable to perform substantially all of his usual and customary duties
under this Agreement or (ii) the date that a reputable physician selected by
the Board, and as to whom the Executive has no reasonable objection, determines
in writing that the Executive will, by reason of physical or mental injury or
disease, be unable to perform substantially all of the Executive’s usual and
customary duties under this Agreement for a period of at least six (6)
consecutive months.  If any question
arises as to whether the Executive is disabled, upon reasonable request
therefore by the Board, the Executive shall submit to reasonable medical
examination for the purpose of determining the existence, nature and extent of
any such disability.  In accordance with
Paragraph 10, the Board shall promptly give the Executive written notice of any
such determination of the Executive’s disability and of any decision of the
Board to terminate the Executive’s employment by reason thereof.  In the event of disability, until the date of
termination, the base salary payable to the Executive under Paragraph 4 hereof
shall be reduced dollar-for-dollar by the amount of disability benefits paid to
the Executive in accordance with any disability policy or program of the
Corporation.

 

(c)           Termination
by the Company Without Cause, or Voluntary Termination by the Executive for
Good Reason. If the Company terminates the Executive’s employment other
than for Cause, or the Executive voluntarily terminates his employment for Good
Reason, in addition to the benefits payable under (a), the Company will pay the
following amounts and provide the following benefits:

 

(i)            The
Base Salary and annual bonus that the Company would have paid under the
Agreement had the Executive’s employment continued to the end of the Employment
Term.  For this purpose, annual bonus
will be determined as the highest of (A) the actual bonus paid for the bonus
plan year immediately preceding such termination, or (B) the target bonus for
the bonus plan year in which such termination occurs.

 

(ii)           Continued
coverage under the Company’s medical, dental, life, disability, pension, profit
sharing and other executive benefit plans through the end of the Employment
Term, at the same cost to the Executive as in effect on the date of the
Executive’s termination.  If the Company
determines that the Executive cannot participate in any benefit plan because he
is not actively performing services for the Company, the Company may provide
such benefits under an alternate arrangement, such as through the purchase of
an individual insurance policy that provides similar benefits or, if
applicable, through a nonqualified pension or profit sharing plan.  To the extent that the Executive’s
compensation is necessary for determining the amount of any such continued
coverage or benefits, such compensation (Base Salary and annual bonus) through

 

4

 

the
end of the Employment Term shall be at the highest rate in effect during the
12-month period immediately preceding the Executive’s termination of
employment.

 

(iii)          Executive
perquisites on the same basis on which the Executive was receiving such perquisites
prior to his employment termination, including: (A) reimbursement for club dues
through the end of the Employment Term; and (B) reimbursement of expenses
relating to financial planning services, tax return preparation and annual
physicals through December 31 of the calendar year that includes the second
anniversary of the Executive’s employment termination.  The Company will bear the cost of such
perquisites, at the same level in effect immediately prior to the Executive’s
employment termination.  Perquisites
otherwise receivable by the Executive pursuant to this Paragraph shall be
reduced to the extent comparable perquisites are actually received by or made
available to the Executive without cost during the period following the
Executive’s employment termination covered by this Paragraph.  The Executive shall report to the Company any
such perquisites actually received by or made available to the Executive.

 

(iv)          The
period through the end of the Employment Term shall continue to count for
purposes of determining the Executive’s age and service with the Company with
respect to eligibility, vesting and the amount of benefits under the Company’s
benefit plans to the maximum extent permitted by applicable law.

 

(v)           Any
outstanding stock options, restricted stock or other equity-based compensation
awards shall immediately vest upon such termination date, and any such stock
options shall be immediately exercisable at any time prior to the earlier
of:  (A) two years; or (B) the stock
option expiration or other termination date.

 

(vi)          The
Executive’s bonus bank amount, if positive, as of the date of such termination.

 

(vii)         Outplacement
services, as elected by the Executive (and with a firm elected by the
Executive), not to exceed $50,000 in total.

 

(d)           Good
Reason.  For purposes of this
Agreement, “Good Reason” shall mean the occurrence of any of the following
without the Executive’s consent (i) assigning duties to the Executive that are
inconsistent with those of the position of Executive Vice President and Chief
Financial Officer for similar companies in similar industries (except to the
extent the Company promotes the Executive to a higher executive position); (ii)
requiring the Executive to report to other than the Company’s Chief Executive
Officer, or the Company’s Board; (iii) the failure of the Company to pay any
portion of the Executive’s compensation within 10 days of the date such
compensation is due; (iv) the Company requires the Executive to relocate his
principal business office to a location not within 50 miles of the Company’s
principal business office located in the Charlotte, North

 

5

 

Carolina
metropolitan area, or (v) the Company’s failure to continue in effect any cash
or stock-based incentive or bonus plan, pension plan, welfare benefit plan or
other benefit plan, program or arrangement, unless the aggregate value of all
such arrangements provided to the Executive after such discontinuance is not
materially less than the aggregate value as of the Effective Date (using, for
purposes of bonus plan comparisons, the target bonus potential before and after
any such discontinuance).

 

(e)           Cause.  For purposes of this Agreement, “Cause” shall
mean:  (i) the Executive’s willful and
continued failure to substantially perform his duties as an executive of the
Company (other than any such failure resulting from incapacity due to physical
or mental illness) after a written demand for substantial performance is
delivered to the Executive by the Board, which demand specifically identifies
the manner in which the Board believes that the Executive has not substantially
performed his duties, and which gives the Executive at least 30 days to cure
such alleged deficiencies, (ii) the Executive’s willful misconduct, which is
demonstrably and materially injurious to the Company, monetarily or otherwise,
or (iii) the Executive’s engaging in egregious misconduct involving serious
moral turpitude to the extent that his credibility and reputation no longer
conforms to the standard of senior executive officers of the Company.

 

(f)            Timing
of Payments.  All payments described
above shall be made in a lump sum cash payment as soon as practicable (but in
no event more than 10 days unless prohibited by applicable law or plan documents)
following the Executive’s termination of employment.  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.

 

6.             Assignment; Successors.  This Agreement shall inure to the benefit of
and be binding upon the Company and its successors.  The Company may not assign this Agreement
without the Executive’s written consent, except that the Company’s obligations
under this Agreement shall be the binding legal obligations of any successor to
the Company by sale, and in the event of any transaction that results in the
transfer of substantially all of the assets or business of the Company, the
Company will use its best efforts to cause the transferee to assume the
obligations of the Company under this Agreement.  The Executive may not assign this Agreement
during his life.  Upon the Executive’s
death this Agreement will inure to the benefit of the Executive’s heirs,
legatees and legal representatives of the Executive’s estate.

 

7.             Interpretation.  The laws of the State of Delaware shall
govern the validity, interpretation, construction and performance of this
Agreement, without regard to the conflict of laws principles thereof.

 

8.             Withholding.  The Company may withhold from any payment
that it is required to make under this Agreement amounts sufficient to satisfy
applicable withholding requirements under any federal, state or local law.

 

9.             Amendment or Termination.  This Agreement may be amended at any time by
written agreement between the Company and the Executive.

 

6

 

10.           Notices.  Notices given pursuant to this Agreement
shall be in writing and shall be deemed received when personally delivered, or
on the date of written confirmation of receipt by (i) overnight carrier, (ii)
telecopy, (iii) registered or certified mail, return receipt requested,
addressee only, postage prepaid, or (iv) such other method of delivery that
provides a written confirmation of delivery. 
Notice to the Company shall be directed to:

 

SPX
Corporation

13515
Ballantyne Corporate Place

Charlotte,
NC 28277

Attention:
General Counsel

 

The Company may change the person and/or address to
whom the Executive must give notice under this Section by giving the Executive
written notice of such change, in accordance with the procedures described
above.  Notices to or with respect to the
Executive will be directed to the Executive, or to the Executive’s executors,
personal representatives or distributees, if the Executive is deceased, or the
assignees of the Executive, at the Executive’s home address on the records of
the Company.

 

11.           Severability.  If any provisions(s) of this Agreement shall
be found invalid or unenforceable by a court of competent jurisdiction, in
whole or in part, then it is the parties’ mutual desire that such court modify
such provision(s) to the extent and in the manner necessary to render the same
valid and enforceable, and this Agreement shall be construed and enforced to
the maximum extent permitted by law, as if such provision(s) had been
originally incorporated herein as so modified or restricted, or as if such
provision(s) had not been originally incorporated herein, as the case may be.

 

12.           Entire Agreement.  This Agreement sets forth the entire
agreement and understanding between the Company and the Executive and
supersedes all prior agreements and understandings, written or oral, relating
to the subject matter hereof; provided, however, that: (i) the Executive’s
Change in Control Agreement dated May 10, 1999 shall remain in full force and
effect, and payments and benefits provided thereunder shall replace those
provided in this Agreement to the extent that such payments or benefits would
otherwise clearly be duplicative; and (ii) the Executive’s non-compete,
non-solicitation, confidentiality or similar restrictive covenants shall remain
in full force and effect.

 

13.           Consultation With Counsel.  The Executive acknowledges that he has had a
full and complete opportunity to consult with counsel of the Executive’s own
choosing concerning the terms, enforceability and implications of this
Agreement, and the Company has made no representations or warranties to the
Executive concerning the terms, enforceability or implications of this
Agreement other than as are reflected in this Agreement.

 

14.           No Waiver.  No failure or delay by the Company or the
Executive in enforcing or exercising any right or remedy hereunder shall
operate as a waiver thereof.  No
modification, amendment or waiver of this Agreement nor consent to any
departure by the Executive from any of the terms or conditions thereof, shall
be effective unless in writing and signed by the Chairman of the Company’s
Board.  Any such waiver or consent shall
be effective only in the specific instance and for the purpose for which given.

 

7

 

15.           Effect on Other Obligations.  Payments and benefits herein provided to be
paid to the Executive by the Company shall be made without regard to and in
addition to any other payments or benefits required to be paid the Executive at
any time hereafter under the terms of any other agreement between the Executive
and the Company or under any other policy of the Company relating to
compensation, or retirement or other benefits. 
Except as otherwise expressly provided herein, payments or benefits
provided the Executive hereunder shall be reduced by any amount the Executive
may earn or receive from employment with another employer or from any other
source.

 

16.           Survival.  All Sections of this Agreement survive beyond
the Employment Term except as otherwise specifically stated.

 

17.           Headings. 
The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning thereof.

 

18.           Counterparts.  The parties may execute this Agreement in one
or more counterparts, all of which together shall constitute but one Agreement.

 

IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date first above written.

 

 

	
  EXECUTIVE ACCEPTANCE

  	
  SPX CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Patrick J. O'Leary

  	
   

  	
  By:

  	
  /s/ Christopher J. Kearney

  	
   

  
	
  Patrick J. O'Leary

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  President and Chief Executive Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  February 28, 2005

  	
   

  
							

 

8

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