FIRST AMENDMENT TO CONSULTING AGREEMENT
This First Amendment to the Consulting Agreement (the "Agreement") dated January
31, 1999, between Xxxxxxx X. Xxxxxx, (the "Consultant") and Varlen Corporation
("Company") shall be effective May 14, 1999.
Schedule 2 of the Agreement entitled "Fee Arrangements" shall be deleted and
replaced with the attached Revised Schedule 2.
All other provisions of the Agreement shall remain in full force and effect.
Xxxxxxx X. Xxxxxx Varlen Corporation
/s/ Xxxxxxx X. Xxxxxx By: /s/ X. X. Xxxx
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Xxxxxxx X. Xxxx
Title: President and Chief Executive
Officer
REVISED SCHEDULE 2
Fee Arrangements
In consideration for the Services provided under this Agreement, Consultant will
receive a fee paid biweekly at a rate of $250,000 per year.
In the event of a Change in Control, as defined below, the foregoing fee
remaining payable under this Agreement shall be accelerated and paid in a lump
sum on the date of such Change in Control.
"Change of Control" means the occurrence of one of the following events:
(i) if any "person" or "group" as those terms are used in Sections 13(d)
or 14(d) of the Exchange Act, other than a Exempt Person, is or becomes the
"beneficial owner" (as defined in rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing 50% or more of the
combined voting power of the Company's then outstanding securities; or
(ii) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board and any new directors whose
election by the Board or nomination for election by the Company's stockholders
was approved by at least two-thirds of the directors then still in office who
either were directors at the beginning of the period or whose election was
previously so approved, cease for any reason to constitute a majority thereof;
or
(iii) the stockholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or consolidation (A)
which would result in all or a portion of the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) more than 50% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation or (B) following which the Company's chief
executive officer and directors retain their positions with the surviving entity
(and constitute at least a majority of the surviving entity's board of
directors); or
(iv) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or other disposition by
the Company of all or substantially all the Company's assets, other than a sale
to an Exempt Person;
provided, however, that if the approval specified in clause (iii) or
clause (iv) above is obtained but such transaction is terminated or abandoned by
the parties thereto prior to its effectuation, then, from and after the date of
such termination or abandonment, no Change of Control shall be deemed to have
occurred by reason of such
approval; and provided further, that no Change of Control shall be deemed to
have occurred by reason of any event involving or arising out of a proceeding
under Title 11 of the United States Code (or the provisions of any future United
States bankruptcy law), an assignment for the benefit of creditors or an
insolvency proceeding under state or local law.
