Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT (this “Agreement”) dated as of January 31, 2007 by
and between BALDOR ELECTRIC COMPANY, a Missouri corporation (the “Company”), and
ROCKWELL AUTOMATION OF OHIO, INC., an Ohio corporation (the “Stockholder”).

W I T N E S S E T H:

WHEREAS, the Company and the Stockholder are parties to the Purchase Agreement,
dated as of November 6, 2006, as amended (the “Purchase Agreement”), by and
among Rockwell Automation, Inc., the Stockholder, Rockwell Automation Canada
Control Systems, Grupo Industrias Reliance S.A. de C.V., Rockwell Automation
GmbH (formerly known as Rockwell International GmbH) and the Company; and

WHEREAS, pursuant to the Purchase Agreement, the Stockholder will receive shares
of Common Stock, par value $.10 per share, and associated preferred share
purchase rights, of the Company (“Company Common Stock”);

NOW, THEREFORE, in consideration of the premises, the mutual agreements
hereinafter contained and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the
Stockholder hereby agree as follows:

1. Definitions. Unless otherwise provided in this Agreement, capitalized terms
used herein shall have the following meanings:

“Agreement” has the meaning set forth in the preamble to this Agreement.

“Closing” has the meaning set forth in the Purchase Agreement.

“Company Common Stock” has the meaning set forth in the recitals to this
Agreement.

“Company” has the meaning set forth in the preamble to this Agreement.

“Demand Registration” has the meaning set forth in Section 2.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Market Price” means, on any trading day, the volume weighted average price per
share of Company Common Stock trading on a “regular way” basis on the New York
Stock Exchange (or if Company Common Stock is not then listed on the New York
Stock Exchange, such other securities exchange and/or quotation system on which
Company Common Stock is then listed and/or quoted).

“Offer” has the meaning set forth in Section 10.

“Offered Securities” has the meaning set forth in Section 10.

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“Person” means any individual, partnership, joint venture, corporation, limited
liability entity, trust, joint venture, unincorporated organization or other
entity (including a governmental entity).

“Piggyback Registration” has the meaning set forth in Section 3.1.

“Purchase Agreement” has the meaning set forth in the recitals to this
Agreement.

“Qualified Holders” means the holders of a majority of the Registrable
Securities then outstanding.

“Registrable Securities” means (a) the Shares and (b) any shares of Company
Common Stock issued or issuable with respect to any of the Shares by way of a
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or similar
transaction. As to any particular Registrable Securities, such securities shall
cease to be Registrable Securities when (i) they have been distributed to the
public pursuant to an offering registered under the Securities Act, (ii) they
have been sold to the public through a broker, dealer or market maker in
compliance with Rule 144 or (iii) all Registrable Securities are then eligible
for resale in a single sale without registration and without being limited to
any volume, time or manner of sale limitations under Rule 144.

“Registration Request” has the meaning set forth in Section 10.

“Rule 144” means Rule 144 under the Securities Act (or any successor rule then
in effect).

“Rule 145” means Rule 145 under the Securities Act (or any successor rule then
in effect).

“SEC” means the U.S. Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“Shares” means the shares of Company Common Stock to be issued to the
Stockholder pursuant to the Purchase Agreement.

“Shelf Registration” has the meaning set forth in Section 2.1.

“Stockholder” has the meaning set forth in the preamble to this Agreement.

“Suspension Period” has the meaning set forth in Section 5.2.

“Violation” has the meaning set forth in Section 7.1.

2. Demand Registrations.

2.1. Requests for Registration. At any time following the Closing, the Qualified
Holders may, subject to the terms hereof, including Section 2.2, Section 2.4,
Section 4.1 and

 

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Section 10, request registration under the Securities Act of all or any portion
of their Registrable Securities (a “Demand Registration”). Each request for a
Demand Registration shall specify the approximate number of Registrable
Securities requested to be registered and the intended method of distribution.
Within ten days after receipt of any such request, the Company shall give
written notice of such requested registration to all other holders of
Registrable Securities and, subject to Section 2.3, shall include as part of
such Demand Registration all Registrable Securities with respect to which the
Company has received written requests for inclusion therein within 15 days after
the receipt of the Company’s notice by such holders. If the Company is eligible
to file with the SEC a registration statement on Form S-3 (or any successor
form), the holders of a majority of the Registrable Securities which are
included in a Demand Registration may require the Company to file such Demand
Registration with the SEC for an offering on a delayed or continuous basis in
accordance with and pursuant to Rule 415 promulgated under the Securities Act
(or any successor rule then in effect) (a “Shelf Registration”).

2.2. Limitations on Demand Registrations. The holders of the Registrable
Securities shall be entitled to request two Demand Registrations with respect to
Registrable Securities; provided, however, that a Demand Registration requested
pursuant to this Agreement shall not be deemed to have been effected for
purposes of this Section 2.2 unless (i) it has been declared effective by the
SEC (or becomes automatically effective upon filing with the SEC), (ii) it has
remained effective for the period set forth in Section 5.2, (iii) holders of
Registrable Securities included in such registration have not withdrawn
sufficient Registrable Securities from such registration such that the remaining
holders of Registrable Securities requesting registration would not have been
able to request registration under the provisions of Section 2.1, and (iv) the
offering of Registrable Securities pursuant to such registration is not subject
to any stop order, injunction or other order or requirement of the SEC or other
applicable governmental entity.

2.3. Priority on Demand Registrations. The Company shall not include in any
Demand Registration any securities that are not Registrable Securities without
the prior written consent of the Qualified Holders. If a Demand Registration is
an underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities requested to
be included in such offering, and if permitted hereunder, other securities
requested to be included in such offering, exceeds the number of securities
which can be sold therein without adversely affecting the marketability of the
offering and within a price range acceptable to the holders of a majority of the
Registrable Securities requested to be registered, the Company shall first
include in such registration, prior to the inclusion of any securities which are
not Registrable Securities, the Registrable Securities requested to be included
which in the opinion of such underwriters can be sold without adversely
affecting the marketability of the offering, pro rata among the respective
holders thereof on the basis of the amount of Registrable Securities owned by
each such requesting holder.

2.4. Restrictions on Registration. The Company shall not be obligated to effect
any Demand Registration within 90 days after the effective date of a previous
Demand Registration. The Company may postpone for up to 45 days the filing or
the effectiveness of a registration statement for a Demand Registration if the
Company furnishes to the Qualified Holders a certificate of the Company signed
by the Chief Financial Officer of the Company stating that such Demand
Registration would reasonably be expected to have a material adverse effect on

 

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any proposal or plan by the Company to engage in any material financing,
acquisition of assets (other than in the ordinary course of business) or any
merger, consolidation, tender offer, reorganization or other significant
transaction; provided, that, in such event, the holders of Registrable
Securities initially requesting such Demand Registration shall be entitled to
withdraw such request and, if such request is withdrawn, such Demand
Registration shall not count as one of the permitted Demand Registrations
hereunder; and provided, further, that the Company may not exercise this
deferral right more than once in any 12-month period.

2.5. Selection of Underwriters. The holders of a majority of the Registrable
Securities included in any Demand Registration shall have the right to select
the investment banker(s) and/or manager(s) to administer the offering in
connection with any Demand Registration, subject to the approval of the Company
(which approval shall not be unreasonably withheld or delayed).

3. Piggyback Registrations.

3.1. Right to Piggyback. Whenever the Company proposes to register any of its
securities under the Securities Act (for its own account or for the account of
any other holder of its securities) under the Securities Act (other than
pursuant to (i) a Demand Registration which shall be governed by Section 2,
(ii) a registration related solely to employee benefit plans or a Rule 145
transaction or (iii) a registration relating to an offering occurring within 90
days after the Closing, substantially all the proceeds of which are used to
finance the cash purchase price under the Purchase Agreement), and the
registration form to be used may be used for the registration of Registrable
Securities (a “Piggyback Registration”), the Company shall give prompt written
notice to all holders of Registrable Securities of its intention to effect such
a registration and, subject to the terms hereof, including Section 10, shall
include in such registration all Registrable Securities with respect to which
the Company has received written requests for inclusion therein within 21 days
after such holders receive the Company’s notice.

3.2. Priority on Primary Registrations. If a Piggyback Registration is an
underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing that in their opinion the number of
securities requested to be included in such registration exceeds the number of
securities which can be sold therein without adversely affecting the
marketability of the offering, the Company shall include in such registration
(a) first, the securities that the Company proposes to sell, (b) second, the
Registrable Securities requested to be included in such registration, pro rata
among the respective holders thereof on the basis of the amount of Registrable
Securities owned by each such requesting holder and (c) third, other securities
requested to be included in such registration. Notwithstanding the foregoing,
the holders of Registrable Securities shall be entitled to include in any such
registration of the Company’s securities at least 20% of the aggregate amount of
securities registered in such registration.

3.3. Priority on Other Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the Company’s
securities other than holders of Registrable Securities, and the managing
underwriters advise the Company in writing that in their opinion the number of
securities requested to be included in such registration exceeds the number of
securities which can be sold in such offering without adversely affecting the

 

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marketability of the offering, the Company shall include in such registration
(a) first, the securities requested to be included therein by the holders
requesting such registration and the Registrable Securities requested to be
included in such registration, pro rata among the holders of all such securities
(including the securities of the requesting holders and the holders of
Registrable Securities) on the basis of the number of securities of the Company
owned by each such holder and (b) second, other securities requested to be
included in such registration; provided, however, that in no event shall the
Company grant to any third party, after the date hereof, registration rights
that have a higher priority than the demand and piggyback registration rights
applicable to Registrable Securities.

3.4. Selection of Underwriters. The Company shall have the right to select the
investment banker(s) and/or manager(s) to administer the offering in connection
with any Piggyback Registration.

4. Lock-Up Arrangements.

4.1. Holders of Registrable Securities. No holder of Registrable Securities
shall effect any public sale or distribution (including sales pursuant to
Rule 144) of equity securities of the Company, or any securities convertible
into or exchangeable or exercisable for such securities, during (i) the 180-day
period beginning on the date of the Closing (except as part of a Piggyback
Registration pursuant to this Agreement) and (ii) the 90-day period beginning on
the effective date of any Piggyback Registration in which Registrable Securities
are included (except as part of such registration), unless (x) the underwriters
managing the registered public offering, in the case of an underwritten public
offering, or (y) the Company, in the case of a non-underwritten public offering,
otherwise agree; provided, that no holder of Registrable Securities shall be
subject to the restrictions of clause (ii) of this Section 4.1 unless all of the
Company’s executive officers and directors and all holders holding in excess of
5% of its outstanding equity securities are subject to restrictions no less
restrictive than those referred to in this Section 4.1.

4.2. The Company. The Company shall not effect any public sale or distribution
of its equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the period beginning on the effective
date of any registration statement in which the holders of Registrable
Securities are participating and ending on the earlier of (x) the date on which
all Registrable Securities registered on such registration statement are sold
and (y) 90 days after the effective date of such registration statement, unless
in each case (x) the underwriters managing the registered public offering, in
the case of an underwritten public offering, or (y) the holders of a majority of
the Registrable Securities participating in such public offering, in the case of
a non-underwritten public offering, otherwise agree.

5. Registration Procedures. Whenever the holders of Registrable Securities have
requested that any Registrable Securities be registered pursuant to this
Agreement, the Company shall effect the registration and the sale of such
Registrable Securities in accordance with the intended method of disposition
thereof, and pursuant thereto the Company shall as expeditiously as possible:

 

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5.1. prepare and file (not later than, in the case of a request for a Demand
Registration, 30 days following such request) with the SEC a registration
statement and such amendments and supplements as may be necessary with respect
to such Registrable Securities and use its commercially reasonable efforts to
cause such registration statement to become effective; provided that before
filing a registration statement or prospectus or any amendments or supplements
thereto, the Company shall furnish to counsel selected by the holders of a
majority of the Registrable Securities being registered copies of such documents
proposed to be filed with an adequate opportunity for review and comment by such
counsel;

5.2. notify each holder of Registrable Securities of the effectiveness of each
registration statement filed hereunder and prepare and file with the SEC such
amendments and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such registration
statement effective for a period of not less than 180 days (or until the
distribution described in the registration statement has been completed) (or, in
the case of a Shelf Registration, a period ending on the earlier of the date on
which all Registrable Securities covered by such registration statement (i) have
been sold or (ii) are then eligible for resale in a single sale without
registration and without being limited to any volume, time or manner of sale
limitations under Rule 144) and to comply with the provisions of the Securities
Act with respect to the disposition of securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration statement;
provided, however, that at any time, upon written notice to the participating
holders of Registrable Securities and for a period not to exceed forty-five
(45) days thereafter (the “Suspension Period”), the Company may suspend the use
or effectiveness of any registration statement (and the holders of Registrable
Securities participating in such offering shall not offer or sell any
Registrable Securities pursuant to such registration statement during the
Suspension Period) if the Company reasonably believes that the Company may, in
the absence of such suspension hereunder, be required under state or federal
securities laws to disclose any corporate development the disclosure of which
could reasonably be expected to have a material adverse effect upon the Company,
its stockholders, a significant transaction or event involving the Company, or
any negotiations, discussions, or proposals directly relating thereto. No more
than two (2) such Suspension Periods shall be permitted to occur in any twelve
(12) month period. In the event that the Company shall exercise its rights
hereunder to effect a Suspension Period, the applicable time period during which
the registration statement is to remain effective shall be extended by a period
of time equal to the duration of the Suspension Period;

5.3. furnish to each seller of Registrable Securities such number of copies of
such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus) and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
seller;

5.4. register or qualify such Registrable Securities under such other securities
or blue sky laws of such jurisdictions as the holders of Registrable Securities
shall reasonably request and do any and all other acts and things that may be
necessary or reasonably advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities

 

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owned by such seller; provided, however, that the Company shall not be required
to (a) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subsection, (b) subject itself to
taxation in any such jurisdiction or (c) consent to general service of process
in any such jurisdiction;

5.5. promptly notify each seller of such Registrable Securities, at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in the registration statement relating to such Registrable
Securities contains an untrue statement of a material fact or omits to state any
material fact necessary to make the statements therein not misleading, and, at
the request of any such seller, the Company shall prepare a reasonable number of
copies of a supplement or amendment to such prospectus so that, as thereafter
delivered to the sellers of such Registrable Securities, such prospectus shall
not contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading, in which event the
period mentioned in Section 5.2 shall be extended by the length of the period
from and including the date when each seller of such Registrable Securities
shall have received such notice to the date on which each such seller has
received the copies of the supplemented or amended prospectus contemplated under
this Section 5.5;

5.6. cause all such Registrable Securities to be listed on each securities
exchange and/or quotation system on which similar securities issued by the
Company are then listed and/or quoted;

5.7. provide a transfer agent and registrar for all such Registrable Securities
not later than the effective date of such registration statement;

5.8. enter into such customary agreements (including underwriting agreements in
customary form) and take all such other actions as the underwriters, if any,
reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities;

5.9. make available for inspection by any seller of Registrable Securities, any
underwriter participating in any disposition pursuant to such registration
statement, and any attorney, accountant or other agent retained by any such
seller or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company’s officers,
directors, employees and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement, in each case as is
necessary or reasonably advisable (in the reasonable judgment of the requesting
party) to enable such seller or underwriter to exercise their due diligence
responsibilities and defenses under the Securities Act;

5.10. otherwise comply with all applicable rules and regulations of the SEC, and
make available to its security holders, as soon as reasonably practicable, an
earnings statement covering the period of at least twelve months beginning with
the first day of the Company’s first full calendar quarter after the effective
date of the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;

 

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5.11. in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any securities included in such registration statement for sale in any
jurisdiction, the Company shall use its commercially reasonable efforts promptly
to obtain the withdrawal of such order;

5.12. obtain a cold comfort letter from the Company’s independent accountants in
customary form and covering such matters of the type customarily covered by cold
comfort letters as a seller of Registrable Securities or the underwriters, if
any, may reasonably request;

5.13. furnish, at the request of any underwriter on the date the Registrable
Securities are delivered to the underwriters for sale pursuant to such
registration, an opinion, dated such date, of counsel representing the Company
for the purposes of such registration, addressed to the underwriters covering
such legal matters with respect to the registration in respect of which such
opinion is being given as the underwriters may reasonably request and are
customarily included in such opinions;

5.14. use its commercially reasonable efforts to cause such Registrable
Securities covered by such registration statement to be registered with or
approved by such other governmental entities or authorities as may be necessary
to enable the sellers thereof to consummate the disposition of such Registrable
Securities; and

5.15. take such other actions as are necessary or reasonably advisable in order
to facilitate and/or expedite the registration and disposition of any
Registrable Securities pursuant to the terms of this Agreement.

6. Registration Expenses. All expenses incident to the Company’s performance of
or compliance with this Agreement (whether with respect to a Demand Registration
or Piggyback Registration), including, without limitation, all registration and
filing fees (including the fees of the National Association of Securities
Dealers, Inc. and the SEC’s registration fees), fees of any transfer agent and
registrar, fees and expenses of compliance with securities or blue sky laws,
printing expenses, “road show” or other marketing expenses, fees and
disbursements of counsel for the Company, fees and disbursements of one counsel
chosen by the holders of a majority of the Registrable Securities included in
such registration, fees and expenses of the Company’s independent registered
public accounting firm (including the fees and expenses of any comfort letters
required by or incident to the performance and compliance with this Agreement),
fees and expenses of underwriters (excluding discounts and commissions
attributable to the Registrable Securities included in such registration), the
Company’s internal expenses and the expenses and fees for listing the securities
to be registered on each securities exchange or quotation system on which
similar securities issued by the Company are then listed or quoted, shall be
borne by the Company.

7. Indemnification.

7.1. In connection with any Demand Registration or Piggyback Registration, the
Company agrees to indemnify, to the extent permitted by law, each holder of
Registrable Securities, the partners or officers, employees, directors and
representatives of such holder, and

 

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each Person who controls (within the meaning of the Securities Act) such holder
against all losses, claims, damages, liabilities and expenses incurred by such
party arising out of, based upon or caused by any of the following statements,
omissions or violations (each, a “Violation”): (i) any untrue or alleged untrue
statement of material fact contained in any registration statement, prospectus
or preliminary prospectus or any amendment thereof or supplement thereto,
(ii) any omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, or (iii) any violation or
alleged violation by the Company of the Securities Act, the Exchange Act, any
state securities laws or any rule or regulation promulgated under the Securities
Act, the Exchange Act or any state securities laws; and the Company will
reimburse each such holder, each of its partners, officers, employees, directors
and representatives, and each Person controlling such holder for any legal or
other expenses reasonably incurred, as such expenses are incurred, by any of
them in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company shall not be liable in
any such case for any such loss, claim, damage, liability or action to the
extent that it is caused by a Violation that is based on, and occurs in reliance
upon and in conformity with, any information furnished in writing to the Company
by such holder stated to be specifically for use in such registration. In
connection with an underwritten offering, the Company shall indemnify such
underwriters, their partners, officers, directors, employees, representatives
and each Person who controls (within the meaning of the Securities Act) such
underwriters to the same extent as provided above with respect to the
indemnification of the holders of Registrable Securities.

7.2. In connection with any Demand Registration or Piggyback Registration in
which a holder of Registrable Securities is participating, each such holder
shall indemnify, to the extent permitted by law, the Company, its directors,
officers, any other holder selling securities in such Demand Registration or
Piggyback Registration, and each Person who controls (within the meaning of the
Securities Act) the Company against all losses, claims, damages, liabilities and
expenses caused by any Violation, but only to the extent that such Violation is
based on, and occurs in reliance upon and in conformity with, any information
furnished in writing by such holder to the Company stated to be specifically for
use in such registration; and such holder will reimburse the Company and each
such Person for any legal or other expenses reasonably incurred, as such
expenses are incurred, by any of them in connection with investigating or
defending any such loss, claim, damage, liability or expense; provided, that,
the obligation to indemnify shall be individual, not joint and several, for each
holder.

7.3. Any Person entitled to indemnification hereunder shall (a) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification (provided that the failure to give prompt notice shall not
impair any Person’s right to indemnification hereunder to the extent such
failure has not materially prejudiced the indemnifying party’s ability to defend
such claim), and (b) unless in the reasonable judgment of any indemnified party
a conflict of interest between such indemnified and indemnifying parties exists
with respect to such claim, permit such indemnifying party to assume the defense
of such claim with counsel reasonably satisfactory to the indemnified party. If
such defense is assumed, the indemnifying party shall not be subject to any
liability for any settlement made by the indemnified party without the
indemnifying party’s consent (but such consent shall not be unreasonably
withheld). An indemnifying party who is not entitled to, or elects not to,
assume

 

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the defense of a claim shall be obligated to pay the fees and expenses of one
counsel (but not more than one) for all parties indemnified by such indemnifying
party with respect to such claim, unless in the reasonable judgment (with advice
of counsel) of any indemnified party a conflict of interest may exist between
such indemnified party and any other of such indemnified parties with respect to
such claim. No indemnifying party shall, without the consent of such indemnified
party (which consent shall not be unreasonably withheld), effect any settlement
of any pending or threatened proceeding in respect of which such indemnified
party is a party and indemnity has been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party and its affiliates from all liability for claims that are the
subject matter of such proceeding.

7.4. The indemnification provided for under this Agreement shall remain in full
force and effect regardless of any investigation made by or on behalf of any
indemnified party or any partner, officer, employee, director, representative or
controlling Person of such indemnified party and shall survive the transfer of
Registrable Securities.

7.5. If the indemnification provided for under this Agreement is unavailable to
an indemnified party hereunder in respect of any losses, liabilities, claims,
damages and expense referred to herein, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and indemnified parties in connection
with the actions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
fault of such indemnifying party and indemnified parties shall be determined by
reference to, among other things, whether any Violation has been committed by,
or relates to information supplied by, such indemnifying party or indemnified
parties, and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such Violation. The amount paid or payable by
a party as a result of the losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with any investigation or
proceeding.

7.6. The parties agree that it would not be just and equitable if contribution
pursuant to this Section 7 were determined solely by pro rata allocation or any
other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.

7.7. Notwithstanding anything in this Section 7 to the contrary, in connection
with any Demand Registration or Piggyback Registration, the indemnity and
contribution obligations and liabilities of each holder of Registrable
Securities shall be limited to the net amount of proceeds received by such
holder pursuant to such registration.

8. Participation in Underwritten Registrations. No Person may participate in any
registration hereunder which is underwritten unless such Person (a) agrees to
sell such Person’s securities on the basis provided in any underwriting
arrangements approved by holders of a

 

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majority of the Registrable Securities being registered in such registration and
(b) completes and executes all questionnaires, powers of attorney and other
documents reasonably required under the terms of such underwriting
arrangements; provided, that, no holder of Registrable Securities included in
any underwritten registration shall be required to make any representations or
warranties to the Company or the underwriters (other than representations and
warranties regarding such holder and such holder’s intended method of
distribution) or to undertake any indemnification obligations to the Company or
the underwriters with respect thereto, except to the extent of the
indemnification provided in Section 7.

9. Rule 144 Reporting. With a view to making available the benefits of certain
rules and regulations of the SEC which may at any time permit the sale of any
Registrable Securities to the public without registration, the Company agrees to
use commercially reasonable efforts to:

9.1. file, as and when applicable, with the SEC in a timely manner all reports
and other documents required of the Company under the Exchange Act;

9.2. if the Company is not required to file reports pursuant to the Exchange
Act, upon the request of any holder of Registrable Securities, the Company shall
make publicly available the information specified in subparagraph (c)(2) of Rule
144; and

9.3. so long as a holder owns any Registrable Securities, to furnish to the
holder, upon request, a written statement by the Company as to its compliance
with the reporting requirements of Rule 144 and such other reports and documents
of the Company and other information in the possession of or reasonably
obtainable by the Company as the holder may reasonably request in availing
itself of any rule or regulation of the SEC allowing the holder to sell any such
securities without registration.

10. Repurchase Right. Each request by a holder of Registrable Securities for, or
to be included in, a Demand Registration or a Piggyback Registration hereunder
(a “Registration Request”) shall also constitute an offer by such holder to sell
(an “Offer”) to the Company all (but not less than all) of the shares of
Registrable Securities that are subject to such Registration Request (the
“Offered Securities”). The Company shall have the option, which must be
exercised in a writing delivered to such holder within two business days after
delivery of the Registration Request, to purchase all (but not less than all) of
the Offered Securities at a price per share equal to the average of the Market
Prices for the 10 trading days preceding the date of the Registration Request.
If the Company accepts an Offer under this Section 10, the closing of the
purchase of the Offered Securities by the Company shall occur within five
business days after acceptance of the Offer by the Company, at which closing the
purchase price for the Offered Securities shall be paid in full by the Company
to such holder by wire transfer of immediately available U.S. dollars to an
account designated by such holder. If the Company elects to purchase and pays
for any Offered Securities in accordance with this Section 10, the Company shall
have no further obligation hereunder to effect a Demand Registration or a
Piggyback Registration, as the case may be, with respect to such Offered
Securities.

 

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11. Miscellaneous.

11.1. No Inconsistent Agreements. The Company shall not hereafter enter into any
agreement with respect to its securities which is inconsistent with or violates
the rights granted to the holders of Registrable Securities in this Agreement.

11.2. Remedies. Any Person having rights under any provision of this Agreement
shall be entitled to enforce such rights specifically, to recover damages caused
by reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law. The parties agree and acknowledge that money
damages are not an adequate remedy for any breach of the provisions of this
Agreement and that any party may apply for specific performance and for other
injunctive relief in order to enforce or prevent violation of the provisions of
this Agreement.

11.3. Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may be amended or waived only upon the prior
written consent of (a) the Company and (b) the holders of a majority of the
Registrable Securities then outstanding.

11.4. Successors, Assigns and Subsequent Holders. (a) All covenants and
agreements in this Agreement by or on behalf of any of the parties shall bind
and inure to the benefit of the respective successors and the permitted assigns
of the parties.

(b) The rights to cause the Company to register Registrable Securities pursuant
to this Agreement may be assigned (but only with all related obligations) by a
holder of Registrable Securities to a transferee of such securities.

(c) No assignment or transfer pursuant to this Section 11.4 shall be effective
unless and until (i) the Company is furnished with written notice of the name
and address of such transferee or assignee and the securities with respect to
which such registration rights are being assigned and (ii) such transferee or
assignee agrees in writing to be bound by and subject to the terms and
conditions of this Agreement.

11.5. Entire Agreement. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and this Agreement supersedes
all prior negotiations, agreements or understandings of the parties of any
nature, whether oral or written, relating thereto.

11.6. Severability. If any term or provision of this Agreement or the
application thereof to any Person or circumstance shall be held to be invalid,
illegal or unenforceable in any respect by a court of competent jurisdiction,
the remaining provisions hereof, or the application of such term or provision to
Persons or circumstances other than those as to which it has been held invalid,
illegal or unenforceable, will remain in full force and effect and will in no
way be affected, impaired or invalidated thereby.

 

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11.7. Notices. All notices, requests, claims, demands and other communications
required or permitted to be given hereunder will be in writing and will be
delivered by hand or telecopied, e-mailed or sent, postage prepaid, by
registered, certified or express mail or reputable overnight courier service
(and will be deemed duly given when so delivered by hand or telecopied, when
e-mail confirmation is received if delivered by e-mail, or if mailed, three days
after mailing (one business day in the case of express mail or overnight courier
service)). All such notices, requests, claims, demands or other communications
will be addressed as set forth below:

If to the Company:

Baldor Electric Company

5711 R.S. Boreham, Jr. Street

Fort Smith, Arkansas 72901

 

Attention:

  

Ron Tucker

President, Chief Financial Officer and Secretary

  

Telecopy:

   (479) 648-5752   

E-Mail:

   RTucker@baldor.com

with a copy to:

Thompson Coburn LLP

One U.S. Bank Plaza

St. Louis, Missouri 63101

 

Attention:

   Thomas E. Proost, Esq.   

Telecopy:

   (314) 552-7000   

E-Mail:

   tproost@thompsoncoburn.com

If to the Stockholder:

Rockwell Automation, Inc.

1201 South Second Street

Milwaukee, Wisconsin 53204

 

Attention:

   Douglas M. Hagerman, Esq. Senior Vice President, General Counsel and
Secretary   

Telecopy:

   (414) 382-8421   

E-Mail:

   dmhagerman@ra.rockwell.com

 

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with a copy to:

Chadbourne & Parke LLP

30 Rockefeller Plaza

New York, New York 10112

 

Attention:

   Peter R. Kolyer, Esq.   

Telecopy:

   (212) 541-5369   

E-Mail:

   pkolyer@chadbourne.com

or in any case to such other address or addresses as hereafter shall be
furnished as provided in this Section 11.7 by either party to the other party.

11.8. Governing Law. This Agreement will be governed by and construed in
accordance with the internal laws of the State of New York applicable to
contracts made and to be performed entirely within such State, without regard to
the conflicts of law principles of such State.

11.9. Dispute Resolution. In the event that any dispute, claim or controversy
arises with respect to the transactions contemplated hereby, this Agreement, any
provision hereof or the breach, performance, enforcement or validity or
invalidity of this Agreement or any provision hereof (collectively, a
“Dispute”), designees of the Company and the holders of a majority of the
Registrable Securities will meet to attempt a good faith resolution of such
Dispute within thirty days after either party notifies the other of a Dispute.
During the period between such notification of a Dispute and thirty days after
such meeting, each party shall be entitled to make any reasonable investigation
of the claims or issues underlying such Dispute that such party deems reasonably
necessary or desirable and, in connection with such investigation, each party
agrees to make available to the other party and its representatives the
information reasonably requested by the other party in connection therewith. If
the Dispute is not resolved within thirty days of such meeting, either party may
make a written demand to the other for formal dispute resolution, which demand
will specify the nature of the Dispute. Within thirty days of such written
demand, or such other time as the parties may agree, the parties will attempt in
good faith to resolve such Dispute by mediation in accordance with the
then-existing CPR Model Procedure for Mediation of Business Disputes,
promulgated by the CPR Institute for Dispute Resolution, in New York City. If
such mediation is unsuccessful within thirty days after commencement thereof,
either party may pursue any other remedies available to it, subject to
Section 11.10.

11.10. Consent to Jurisdiction. Subject to Section 11.9, each of the parties
irrevocably and unconditionally submits to the exclusive jurisdiction of (i) the
Supreme Court of the State of New York, New York County and (ii) the United
States District Court for the Southern District of New York for the purposes of
any suit, action or other proceeding arising out of or relating to the
transactions contemplated hereby, this Agreement, any provision hereof or the
breach, performance, enforcement or validity or invalidity of this Agreement or
any provision hereof (and agrees not to commence any action, suit or proceeding
relating thereto except in such courts). Each of the parties further agrees that
service of any process, summons, notice or document hand delivered or sent by
U.S. registered mail to such party’s respective address set

 

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forth in Section 11.7 will be effective service of process for any action, suit
or proceeding in any such courts with respect to any matters to which it has
submitted to jurisdiction as set forth in the immediately preceding sentence.
Each of the parties irrevocably and unconditionally waives any objection to the
laying of venue of any action, suit or proceeding arising out of or relating to
the transactions contemplated hereby, this Agreement, any provision hereof or
the breach, performance, enforcement or validity or invalidity of this Agreement
or any provision hereof in (i) the Supreme Court of the State of New York, New
York County or (ii) the United States District Court for the Southern District
of New York and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
Notwithstanding the foregoing, each party agrees that a final judgment in any
action or proceeding so brought shall be conclusive and may be enforced by suit
on the judgment in any jurisdiction or in any other manner provided in law or in
equity.

11.11. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THE TRANSACTIONS CONTEMPLATED HEREBY, THIS
AGREEMENT, ANY PROVISION HEREOF OR THE BREACH, PERFORMANCE, ENFORCEMENT OR
VALIDITY OR INVALIDITY OF THIS AGREEMENT OR ANY PROVISION HEREOF.

11.12. Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original, but all of which together will
constitute a single instrument.

 

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IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement
to be executed the day and year first above written.

 

BALDOR ELECTRIC COMPANY By:   /s/ Ronald E. Tucker   Name:   Ronald E. Tucker  
Title:   President, Chief Financial Officer and Secretary

 

ROCKWELL AUTOMATION OF OHIO, INC. By:   /s/ Steven Eisenbrown   Name:   Steven
Eisenbrown   Title:   President