Exhibit 10.2
[SPX Letterhead]
April 11, 2005
Ross B. Bricker
2401 Pioneer Road
Evanston, IL 60201
Dear Ross:
SPX
Corporation (the "Company") recognizes that your contribution to
its growth and success will 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 which 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
disturbing circumstances arising from the possibility of a Change
of Control.
Further,
it is the intent of the Board in adopting this 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 ("Agreement") in the event that your employment is
terminated due to a Change of Control.
1.
Term of Agreement
. This
Agreement will become effective on the date hereof (the
"Commencement Date") and shall continue in effect through the third
anniversary of the Commencement Date (the "Date of Expiration").
However, on that initial Date of Expiration, and on each extended
Date of Expiration thereafter, the term of this Agreement will be
extended automatically for one additional year unless, not later
than six (6) months prior to such Date of Expiration, the
Company gives written notice to you that it has elected not to
extend this Agreement. However, if a Change of Control occurs
during the term of this Agreement, this Agreement will continue in
effect for thirty-six (36) months beyond the end of the month
in which the Change of Control occurred.
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 which acquires beneficial
ownership of common shares of the Company, is or becomes the
"Beneficial Owner" (as defined below) of twenty percent (20%) 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 percent (20%) 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 percent (20%) 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 percent (20%)
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 paragraph (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.
(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)
which 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)
which 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 (other than rights under
the Company's Rights Agreement dated June 25, 1996 with The
Bank of New York, as amended), 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)
which 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 subparagraph (a)(iii)(B)(2), above) or disposing of
any securities of the Company.
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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 securities then issued and outstanding together with
the number of such securities not then actually issued and
outstanding which 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-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 paragraph (a),
above, or paragraph (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)
Approval by the shareholders of (or if such
approval is not required, 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
paragraph (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 eighty percent (80%) 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.
Any
other provision of this Agreement to the contrary notwithstanding,
a "Change of Control" shall not include any transaction described
in paragraph (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
. "Disability"
shall mean that, as a result of your incapacity due to physical or
mental injury or illness, you shall have been absent from the
full-time performance of your duties with the Company for at least
six (6) consecutive months and, within thirty
(30) calendar days after written notice of suspension is
given, you shall not have returned to the full-time performance of
your duties.
(b)
Retirement
. "Retirement"
shall mean your voluntary termination of your employment (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
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which is demonstrably and materially
injurious to the Company, monetarily or otherwise, or
(iii) your having been convicted of a felony which impairs
your ability substantially to perform your duties with the Company.
For purposes of this paragraph (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.
(d)
Good Reason . You shall be entitled
to terminate your employment for Good Reason. For purpose of this
Agreement, "Good Reason" shall mean, without your express written
consent, the occurrence within three (3) years following a
Change of Control of the Company of any one or more of the
following:
(i)
The assignment to you of duties
inconsistent with your duties, responsibilities, and the status of
your position as of the day prior to the Change of Control of the
Company, or a reduction or alteration in the nature or status of
your responsibilities 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 two hundred and fifty
(250) miles from the location where you are currently
based;
(iv)
The failure by the Company to
continue in effect the Company's Pension Plan, Retirement Savings
Plan, Supplemental Retirement Savings Plan, Supplemental Retirement
Plan, Executive EVA Incentive Compensation Plan, 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 years, you request to be reinstated and are ready, willing,
and able to adequately perform your employment duties;
(vi)
The termination, 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, unless the officer is terminated due to death, Disability,
or Retirement, or by the Company for Cause, or by the officer 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
(viii)
Any purported termination by the Company of your
employment that is not effected pursuant to a Notice of Termination
satisfying the requirements of paragraph (f), below, and for
purposes of this Agreement, no such purported termination shall be
effective.
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(ix)
At any time during the one (1)-year period
beginning thirty (30) days following a Change of Control, you
shall be entitled to terminate your employment for any reason, and
such termination shall be deemed to be for Good Reason for all
purposes of this Agreement.
Your
right to terminate your employment pursuant to this
paragraph (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.
(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
