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EXHIBIT 10(xi)
[SPX CORPORATION LOGO]
PATRICK J. O'LEARY
STOCK OPTION AWARD
THIS AGREEMENT is made on and as of August 22, 2000, by and between SPX
CORPORATION, a Delaware Corporation ("SPX" or the "Company") and PATRICK J.
O'LEARY ("Executive").
1. Grant of Options. In recognition of the Executive's performance as Vice
President Finance, Treasurer and Chief Financial Officer of the
Corporation, and as an inducement to his continuing in the employ of
the Company, SPX hereby grants to Executive Options to purchase 500,000
Shares of the Company's Common Stock, par value $10.00 ("Common Stock")
at Option Prices set forth below and in the manner and subject to the
terms and conditions hereinafter provided:
<TABLE>
<CAPTION>
Number of Shares Option Price Per Share
---------------- ----------------------
<S> <C>
125,000 $210.00
125,000 $240.00
125,000 $270.00
125,000 $300.00
</TABLE>
These Options are granted to Executive by the Board of Directors of the
Company and are in addition to the stock options granted to Executive
under the Company's 1992 Stock Compensation Plan. The Options granted
under this Agreement are outside of and not granted pursuant to said
Plan. To the extent that shares of Common Stock are held by the Company
as treasury shares at the time that the Options (or any portion
thereof) are exercised, the Company will use treasury shares as the
source of the Common Stock
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issued to the Executive in connection with such exercise. The Board of
Directors has delegated to its Compensation Committee (the "Committee")
the authority to make such determinations and interpretations of this
Agreement as it deems necessary and appropriate to carry out its intent
and terms.
2. Nonqualified Replacement Options. These Options are granted with the
right to receive "Nonqualified Replacement Options" in accordance with
the terms of this Agreement. A Nonqualified Replacement Option shall be
granted upon the exercise of all or any portion of the Options
(including exercise of any Nonqualified Replacement Options granted
under this paragraph 2) if either (i) previously-owned shares of Mature
Common Stock (defined below) are surrendered (whether by delivery or
attestation) in payment of the Option Price or tax withholding, or (ii)
shares of Common Stock otherwise issuable upon such exercise are
withheld to satisfy minimum tax withholding, subject to the following:
a. The number of shares of Common Stock subject to the new
Nonqualified Replacement Option shall be the number of shares
of Common Stock surrendered or withheld.
b. The Option Price of the new Nonqualified Replacement Option
shall be the fair market value of a share of Common Stock on
the date the new Nonqualified Replacement Option is granted.
c. The new Nonqualified Replacement Option shall be fully vested
immediately upon grant and shall expire on the Expiration Date
set forth in paragraph 3.
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However, any other provision of this Agreement notwithstanding, a
Nonqualified Replacement Option will not be granted upon the exercise
of an Option, including a Nonqualified Replacement Option, unless the
fair market value of a share of Common Stock on the date of such
exercise is at least 25% higher than the Option Price of the Option or
Nonqualified Replacement Option being exercised, as applicable. "Mature
Common Stock" means, for purposes of this Agreement, Common Stock that
has been acquired by the Executive on the open market or that has been
acquired pursuant to an employee benefit arrangement of the Company and
held for at least six months. For purposes of this paragraph 2, fair
market value shall be determined in accordance with paragraph 5.d.,
below. For purposes of the following provisions of this Agreement, the
term Options shall also refer to Nonqualified Replacement Options
granted under this paragraph 2.
3. Time of Exercise of Options/Vesting.
a. The Options granted hereunder may be exercised in whole or in
part at any time and from time to time on or after the Vesting
Date and prior to or on the Expiration Date.
b. The Vesting Date is the earliest of: (i) August 22, 2005, (ii)
the date on which a "Change of Control" of the Company occurs
as defined in the Executive's "Change of Control Executive
Severance Agreement" dated February 15, 1999, or (iii) the
date on which the Executive's employment with the Company is
terminated by reason of his death or disability. If, prior to
the Vesting Date, the Executive's employment with the Company
terminates for any reason other than
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the Executive's death or disability, this Agreement and all of
the Options shall terminate immediately upon such termination
of employment.
c. The Expiration Date is the earliest of (i) August 21, 2010,
(ii) the date which is twelve (12) months after the date on
which the Executive's employment with the Company is
terminated by reason of his death, or (iii) the date which is
ninety (90) days after the date on which the Executive's
employment with the Company terminates for any reason other
than his death; provided, however, that if the Executive dies
during that ninety (90)-day period, then the Expiration Date
shall be the date which is nine (9) months after the
Executive's death.
4. Non-Competition. If the Executive, without the prior written consent of
the Company, directly or indirectly owns, manages, operates, controls,
becomes employed by or otherwise participates in the management,
operation or control of any business which is competitive with the
business of the Company or any of its subsidiaries, all of the
Executive's rights hereunder as to any unexercised portion of the
Options shall be forfeited.
5. Manner of Exercise. The Options may be exercised by written notice
which shall:
a. State the election to exercise the Options and the number of
shares and Option Price(s) in respect of which they are being
exercised;
b. Be signed by Executive or such other person or persons
entitled to exercise the Options;
c. Be in writing and delivered to SPX to the attention of its
Secretary;
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d. Be accompanied by payment in full of the Option Price for the
shares to be purchased and the Executive's copy of this
Agreement. Payment may be made by: (i) certified or cashier's
check, money order or other cash payment, or (ii) delivery (or
deemed delivery by attestation) of Mature Common Stock with a
fair market value as of the exercise date equal to the
aggregate Option Price for the shares to be purchased (or a
combination of (i) and (ii)). The fair market value of the
Common Stock for this purpose shall be the closing price of a
share of Common Stock as reported in the "NYSE-Composite
Transactions" section of the Midwest Edition of The Wall
Street Journal for the exercise date or, if no prices are
quoted for such date, on the next preceding date on which such
prices of Common Stock are so quoted;
e. Be accompanied by payment in cash of any Federal, state or
local taxes required by law to be withheld by the Company with
respect to the exercise of the Options, unless other
satisfactory arrangements are made between the Company and the
Executive to satisfy such withholding obligations, which
arrangements may include the withholding of shares of Common
Stock with a fair market value equal to the minimum statutory
payroll and withholding taxes imposed as a result of such
exercise; and
f. Contain representations by the Executive or other person or
persons entitled to exercise the Options that the shares of
Common Stock are being acquired for investment and with no
present intention of selling or transferring them and that the
person acquiring them will not sell or otherwise transfer the
shares except in compliance with all applicable securities
laws and requirements of any stock
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exchange upon which the shares may then be listed; provided,
however, that no such representations shall be required if a
registration statement under the Securities Act of 1933 is in
effect with respect to the shares of Common Stock to be
issued.
As promptly as practicable after receipt of such notice and payment,
the Company shall cause to be issued and delivered to the Executive or
such other person or persons entitled to exercise the Options, as the
case may be, certificates for the shares of Common Stock so purchased,
which certificates may, if appropriate, be endorsed with restrictive
legends to reflect any applicable restrictions on the transferability
of such shares. If the Options shall have been exercised in full, this
Agreement shall be canceled and retained by the Company; otherwise it
shall be appropriately endorsed to reflect partial exercise and
returned to the Executive or other person entitled to exercise the
Options.
6. Restrictions on Transfer of Options. Except as otherwise provided
below, the Options may not be sold, transferred, pledged, assigned or
otherwise alienated or hypothecated, other than by will or by the laws
of descent and distribution; and the Options shall be exercisable
during the Executive's lifetime only by him. However, the Options may
be transferred to members of the Executive's immediate family or to one
or more trusts for the benefit of the Executive and/or his immediate
family members or to partnerships in which the Executive and/or his
immediate family members are the only partners; provided that the
Executive does not receive any consideration for such transfer and the
Executive provides to the Company such documentation and/or information
concerning any such transfer or transferee as the Committee may
reasonably require. Any Options
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held by transferees permitted under this paragraph 6 shall remain
subject to the same terms and conditions that applied immediately prior
to such transfer. If without having fully exercised the Options granted
hereunder, the Executive dies, the Options remaining outstanding
hereunder pursuant to paragraph 3, above, shall be exercisable by the
person or persons who shall have acquired the Executive's rights
hereunder by will or the laws of descent and distribution and may be
exercised for a period ending on the Expiration Date as set forth in
paragraph 3, above.
7. Rights Prior to Exercise of Option. Executive shall not have any rights
as a stockholder with respect to the shares of Common Stock subject to
this Agreement until exercise of the Options and delivery of the shares
as herein provided.
8. Adjustment in the Event of Changes Affecting Common Stock. In the event
of any change in the outstanding shares of Common Stock that occurs by
reason of a stock dividend or split, recapitalization, merger,
consolidation, combination, exchange of shares, or other similar
corporate change, the aggregate number of shares of Common Stock
subject to the Options, and the Option Prices, shall be appropriately
adjusted by the Committee, whose reasonable determination shall be
conclusive, provided, however, that fractional shares shall be rounded
to the nearest whole share.
9. No Contract of Employment. Nothing contained in this Agreement shall be
construed as a contract of employment between SPX and Executive, or as
creating a right of Executive to be continued in the employment of SPX,
or as a limitation of SPX's right to discharge
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Executive with or without Cause. Except as expressly provided herein,
this Agreement shall not be construed as a term or condition of the
Executive's employment and, in particular, it shall neither confer upon
the Executive any additional rights or privileges relative to his
existing terms and conditions of employment nor entitle the Executive
to additional compensation or damages upon any termination of
employment.
10. Binding Effect. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective executors,
administrators, legal representatives, successors and assigns. This
Agreement may be amended only by further written agreement of the
Company and Executive.
11. Construction of Pronouns. Pronouns in the masculine used in this
Agreement shall be construed as either masculine or feminine, as
appropriate in the particular context.
12. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Michigan, as applicable to a
contract entered into and performed entirely within the State of
Michigan.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
SPX CORPORATION EXECUTIVE
/s/ John B. Blystone /s/ Patrick J. O'Leary
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John B. Blystone Patrick J. O'Leary
Chairman, President and
Chief Executive Officer
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