AMENDMENT NO. 2
EMPLOYMENT AGREEMENT
THIS AMENDMENT NO. 2 to the Employment Agreement dated
December 1, 1993 (hereinafter "Employment Agreement"), by and between SPS
Technologies, Inc., a Pennsylvania corporation (the "Company") and Charles W.
Grigg, residing at 2504 N. Bingham Street, Cornwall, VT 05753 (the "Employee").
WHEREAS, the Employee is currently employed by the Company as
the Company's Chairman of the Board; and
WHEREAS, the Company desires to continue to employ the
Employee as the Company's Chairman of the Board and the Employee desires to
continue to be so employed, on the terms and conditions set forth in the
Employment Agreement as amended herein;
NOW, THEREFORE, in consideration of the foregoing and the
mutual promises contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree to amend the Employment Agreement as follows:
1. Section 1 is deleted and shall be replaced in its entirety as
follows:
"Section 1. Employment. Effective January 1, 2003, the Company
hereby continues to employ the Employee, which employment the
Employee hereby accepts, to serve, subject to the direction of
the Board of Directors of the Company (the "Board"), as the
Company's Chairman of the Board ("Chairman"). In such regard, the
Employee agrees to work part-time to undertake and discharge the
following duties: member of the Company's Board as Chairman,
strategic planning and initiatives, mergers and acquisitions,
business development, monthly operations review with Company
management, selective quarterly reviews with the Company's Group
management, budget and long range planning advice, and such other
duties, functions and responsibilities as are from time to time
assigned to the Employee by the Company's Board, consistent with
the terms and provisions of this Employment Agreement."
2. Section 2(a) is deleted and shall be replaced in its entirety
as follows:
"Section 2. Term and Termination.
(a) Term. The Employee's employment by the Company pursuant to
this Amendment No. 2 shall be effective as of January 1, 2003
(the "Effective Date") and shall continue until December 31,
2003, unless such employment is terminated by the Employee or the
Company in accordance with Section 2(b) as amended or Section
2(d) of the Employment Agreement. The mutual written consent of
Employee and Company shall be required for the extension of the
term of Employee's employment by the Company beyond December 31,
2003."
3. Section 2(b) is deleted and shall be replaced in its entirety
as follows:
"(b) Termination by Employee or Company. The Company may
terminate the duties of the Employee, except as a member of the
Board of Directors, at any time by giving at least ninety (90)
days prior written notice of such termination to the Employee. If
the Company terminates employment of the Employee, the Employee
shall continue to receive compensation pursuant to this Amendment
No. 2 and shall continue to be an employee of the Company with
all rights and benefits as provided under the Employment
Agreement until December 31, 2003. Notwithstanding the foregoing,
if the Company is prohibited by law or the terms of its plans to
continue benefits to the Employee after his termination of
employment, the Company shall, in the case of retirement
benefits, provide such benefits through the Supplemental
Executive Retirement Plan and the Benefit Equalization Plan or
any other non-qualified retirement plan and in the case of
welfare benefits, provide such benefits through individual
insurance arrangements or self-insured arrangements. If either
the Company or Employee decides not to extend the term of this
Amendment No. 2 or further amend the Employment Agreement, then
the Employee shall retire from the Company effective January 1,
2004. The Employee may terminate his employment with the Company
at any time by giving at least ninety (90) days prior written
notice of such termination to the Company. If the Employee
terminates his employment with the Company, the Employee shall
not continue to receive compensation pursuant to this Amendment
No. 2 and shall retire from the Company effective upon the date
of such termination."
4. Section 3(a) is deleted and shall be replaced in its entirety
as follows:
"Section 3. Compensation.
(a) Base Salary. In consideration for all services rendered by
the Employee, hereunder or otherwise, to or for the benefit of
the Company, its subsidiaries and affiliates, the Company shall
pay the Employee a base salary at the rate per annum equal to Two
Hundred Thousand Dollars ($200,000), payable in equal monthly
installments."
5. Section 3(c) is deleted and shall be replaced in its entirety
as follows:
"(c) Incentive Compensation. The Employee shall continue to
participate in all incentive compensation plans of the Company
that the Employee participated in for Fiscal Year 2001 at the
same percentages of base salary except that the base salary used
to determine such incentive compensation shall be as provided in
Section 3(a) of this Amendment No. 2."
6. Section 3(d) is deleted and shall be replaced in its entirety
as follows:
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"(d) Benefit Plans. The Employee shall be eligible during the
term of his employment under this Employment Agreement to
participate in all Employee benefit plans and Employee fringe
benefits such as medical, dental and disability and retirement
programs (including the Company's Retirement Income Plan,
Executive Deferred Compensation Plan, Supplemental Executive
Retirement Plan, and Benefit Equalization Plan, but specifically
excluding the Company's Senior Executive Severance Plan ("SESP"))
now or hereafter made available to executive employees of the
Company generally (collectively, such plans and programs, but
excluding the SESP, are herein collectively referred to as the
"Benefit Plans"), to the extent and on the same terms and
conditions (subject, however, to the terms and provisions of any
such plans or programs) as from time to time are accorded other
employees serving as executive officers of the Company, except as
such Benefit Plans may be expressly modified by the terms of the
Employment Agreement, Amendment No. 1 and this Amendment No. 2.
For purposes of life insurance, the Employee shall be reimbursed
for the purchase of term life insurance in the same amount and
same manner as in Fiscal Year 2001. Additionally, following
expiration or termination of employment by the Company pursuant
to this Amendment No. 2, the Company shall continue to provide
medical coverage for Employee as long as Employee is Chairman of
the Company's Board of Directors. Such medical coverage shall be
comparable to medical coverage provided for executive employees
of the Company and shall be paid for by the Company. However,
Employee's participation in such medical coverage shall be
subject to the terms of the applicable medical plan documents and
applicable policies of the Company. If for any reason the Company
cannot provide an entitled benefit as provided herein, the
Company shall reimburse the Employee, on an after tax basis, the
Employee's reasonable cost to secure such a benefit."
7. The sentence added at the end of Section 6(a) by Amendment
No. 1 is deleted and shall be replaced in its entirety as follows:
"In the event of a `Triggering Termination' of the
Employee during a `Change of Control Period' pursuant to this
Section, severance payable to the Employee pursuant to his
Executive Severance Agreement shall be determined by disregarding
Employee's base salary and incentive compensation for Fiscal Year
2003 and using in lieu thereof Employee's base salary and
incentive compensation for Fiscal Year 2001."
The effective date of this Amendment No. 2 to the Employment Agreement shall be
January 1, 2003.
All other terms and conditions of the Employment Agreement and Amendment No. 1
to the Employment Agreement shall remain unchanged and in effect.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the 5th day
of December, 2002.
Attest: SPS TECHNOLOGIES, INC.
_________________________ By:_______________________
Secretary
EMPLOYEE:
_________________________ __________________________
Witness Charles W. Grigg
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