REGAL BELOIT CORPORATION

TARGET (SUPPLEMENTAL) RETIREMENT PLAN

As Amended and Restated Effective January 1, 2010

 
I.
PURPOSE

 
II.
DEFINITIONS

 
III.
ELIGIBILITY; PARTICIPATION

 
IV.
BENEFITS

 
V.
CLAIM FOR BENEFITS PROCEDURE

 
VI.
ADMINISTRATION

 
VII.
AMENDMENT AND TERMINATION

 
VIII.
MISCELLANEOUS

 
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REGAL BELOIT CORPORATION

TARGET (SUPPLEMENTAL) RETIREMENT PLAN

 
I.           PURPOSE
 
Regal Beloit Corporation desires to provide Plan Participants with a retirement
benefit which is adequate and competitive, when compared to peer company
employers.  The Plan is intended to provide a mechanism to provide supplemental
retirement benefits to existing and newly hired employees of the Company who
become eligible to participate, and to supplement retirement benefits payable
from the Company’s qualified retirement plan(s) to executives who are hired
mid-career.  By providing such benefits, the Company will remain able to attract
and retain exceptional senior management personnel, and provide for orderly
management succession.
 
 
II.           DEFINITIONS
 
2.01           “Actuarial Equivalent” means a form of benefit differing in time,
period, or manner of payment, but having the same value as the form of benefit
payment expected to be paid to a Participant over his or her remaining lifetime,
commencing on the first day of the month coincident with or next following his
or her Normal Retirement Date.  An Actuarial Equivalent determined hereunder
shall be based on the mortality table, assumed rate of interest, and other
factors utilized by the Pension Benefit Guaranty Corporation (PBGC), and in
effect at the time a benefit payment amount is determined.  PBGC factors to be
utilized in determining the value of a benefit will be those factors used by the
PBGC to value annuities for a single employer, trusteed plan terminating as of
the first day of the month that includes the date in which the Participant
attains (or would have attained) his or her Normal Retirement Date.
 
2.02           “Administrative Committee” and “Committee” mean the Committee
appointed pursuant to Article VI to administer the Plan.
 
2.03           “Affiliate” means each entity that is required to be aggregated
with the Company pursuant to Code Section 414(b) or (c); provided that for
purposes of determining if a Participant has incurred a Separation from Service,
the phrase “at least 50 percent” shall be used in place of the phrase “at least
80 percent” each place it appears therein or in the regulations thereunder.
 
2.04           “Agreement” means the Regal Beloit Corporation Target
(Supplemental) Retirement Plan Agreement between a Participant and the Company,
whereby a Participant agrees to the terms and provisions of the Plan, and the
Company agrees to pay benefits in accordance with the Plan.  An Agreement shall
be executed by and between the Company when a Participant first becomes eligible
to participate in the Plan.
 
2.05           “Change of Control” means that a “Change in Control of the
Company” has been deemed to occur pursuant to a Change in Control Agreement in
effect between the Company and its Chief Executive Officer.  If the Company is
not a party to such a Change in Control Agreement, “Change of Control” means the
purchase or other acquisition by any person, entity or group of persons, within
the meaning of Sections 13(d) or 14(d) of the Securities Exchange Act of 1934 or
any comparable successor provision, or a beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Act) of 30% or more of either the
outstanding shares of common stock or the combined voting power of Company’s
then outstanding voting securities entitled to vote generally, or the approval
by the stockholders of Company of a reorganization, merger, or consolidation, in
each case, with respect to which persons who were stockholders of the Company
immediately prior to such reorganization, merger or consolidation do not,
immediately thereafter, own more than 50% of the combined voting power entitled
to vote generally in the election of directors of the reorganized, merged or
consolidated Company’s then outstanding securities, or a liquidation or
dissolution of Company or of disposition by the sale of all or substantially all
of the Company’s assets.
 
2.06           “Company” means Regal Beloit Corporation, a Wisconsin
Corporation, its successors and assigns, and any Affiliate which grants
participation hereunder to an employee with the Company’s consent.  References
to “Company” in the Plan refer to the Company or, if appropriate, the
participating Affiliate of the Company which employs the Participant.
 
2.07           “Early Retirement Date” and “Early Retirement” mean the date of
Termination of Service of a Participant for reasons other than death before age
sixty-five (65), but at or after age fifty-eight (58) with fifteen (15) Years of
Service, or a Separation from Service under circumstances which the Company, in
its sole discretion and prior to the first day of the seventh (7th) month
following the month in which the Separation from Service occurs, elects to treat
as an Early Retirement under the Plan.
 
2.08           “ERISA Funded” means that the Plan is prevented from meeting the
“unfunded” criterion of the exceptions to the application of Parts 2 through 4
of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974,
as amended (ERISA).
 
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2.09           “Final Average Compensation” means the average result produced by
dividing the total Salary of a Participant during the sixty (60) consecutive
month period immediately preceding the earlier of his or her Termination of
Service with the Company or Separation from Service, by the lesser of:
 
(a)           sixty (60), or
 
(b)           the actual number of months of the Participant’s service with the
Company, as determined pursuant to the Participant’s Agreement to participate in
the Plan.
 
2.10           “IRC” means the Internal Revenue Code of 1986, as amended.
 
2.11           “Normal Retirement Date” and “Normal Retirement” mean the date of
Separation from Service of the Participant coincident with or following the date
he or she attains age sixty-five (65).
 
2.12           “Other Retirement Plans”, “Other Retirement Plans’ Benefit” mean
the aggregate of the retirement benefit which is attributable to the
Hypothetical Investment Account, or its Actuarial Equivalent, to which a
Participant would be entitled if monthly payments were made to him in the form
of a single life annuity commencing on the first day of the month immediately
following the Participant’s Normal Retirement Date.  For purposes of the Plan,
the “Hypothetical Investment Account” shall consist of an amount equal to the
hypothetical value of the Participant’s Profit Sharing Plan Account, as
hereinafter described.  A Participant’s Hypothetical Account shall consist of
the beginning balance of Participant’s Profit Sharing Plan Account as of the
Profit Sharing Plan’s most recent valuation date immediately preceding the
Participant’s date of eligibility for participation in this Plan, as specified
in the Participant’s Agreement.  The beginning balance of each Participant’s
Hypothetical Investment Account shall be increased by Hypothetical Company
Contributions, if any, and by Hypothetical Investment Earnings.  “Hypothetical
Company Contributions” shall be calculated and determined assuming an annual
increase in Salary of one percentage point higher than the cost-of-living
adjustments applied under IRC Section 415(b)(1)(A), and Company contributions
determined as follows:  (a) For periods prior to the date the Regal Beloit
Corporation Profit Sharing Plan was merged with the predecessor plan to form the
Regal Beloit 401(k) Plan, a four percent (4%) of a Participant’s base salary
Profit Sharing Plan contribution, subject to the wage limit of IRC 401(a)(17)
and the regulations there under; (b) For periods on and after the date the Regal
Beloit Corporation Profit Sharing Plan was merged with the predecessor plan to
form the Regal Beloit 401(k) Plan and ending December 31, 2008, a Company
matching contribution equal to 1.5% of a Participant’s Salary, subject to the
wage limit of IRC(a)(17) and the regulations there under plus a Company base
contribution of 2% of a Participant’s Salary, subject to the wage limit of
IRC(a)(17) and the regulations there under; and (c) For periods beginning
January 1, 2009 and later, a Company matching contribution equal to 3.5% of a
Participant’s Salary plus, if the Participant is eligible for a Company base
contribution under the Regal Beloit 401(k) plan, a Company base contribution of
2% or 1% of the Participant’s Salary (as specified for the Participant under the
Regal Beloit 401(k) Plan), subject to the wage limit of IRC 401(a)(17) and the
regulations there under; provided, however, that the hypothetical base
contribution shall not be credited unless the Participant is employed on the
last day of the Plan Year; and (c) Any other Company contributions to a
qualified retirement plan in which the employee has been a Participant if
specified in the Participant’s Agreement.  “Hypothetical Investment Earnings”
shall be calculated and determined assuming investment earnings equal to the
most recent 12-month average yield on corporate bonds.  Hypothetical Company
Contributions and Hypothetical Investment Earnings shall be credited to a
Participant’s Hypothetical Investment Account at the same time and in the same
manner as prescribed by the Profit Sharing Plan.  For purposes of this Section,
the “average yield on corporate bonds” means the composite average yield for the
preceding calendar year of industrial and public utility bonds, rated Aaa
through Baa, as determined from “Moody’s Bond Record” published monthly by
Moody’s Investor’s Service, Inc.  (or any successor thereto), or, if such yield
is no longer available, a substantially similar average selected by the
Administrative Committee.
 
2.13           “Participant” means an employee of the Company who is designated
to be eligible pursuant to Section 3.01 hereof and who signs and delivers an
Agreement to the Company.
 
2.14           “Plan” means the Regal Beloit Corporation Target (Supplemental)
Retirement Plan, as amended from time to time.
 
2.15           “Plan Year” means the Company’s fiscal year, which, unless and
until changed, is January 1 to December 31.
 
2.16           “Profit Sharing Plan” means either the Regal Beloit Corporation
Profit Sharing Plan, as amended from time to time, or the Regal Beloit 401(k)
Plan and its predecessor, as amended from time to time.  Unless the context
requires otherwise, definitions as used herein shall have the same meaning as in
the Profit Sharing Plan when applied to said Plan.
 
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2.17           “Retirement Date” means a Participant’s Early Retirement Date or
Normal Retirement Date.
 
2.18           “Salary” for purposes of the Plan shall be the total of the
Participant’s base yearly salary paid by the Company during a Plan Year, and
considered “wages” for FICA and federal income tax withholding, plus the amount
of any target Company bonus opportunity for the Plan Year (whether or not earned
or paid for such Plan Year) and any amounts deferred by the Participant under an
unfunded, nonqualified plan maintained by the Company.  Notwithstanding the
foregoing, with respect to Participants who retired prior to January 1, 2008,
the actual Company bonus earned for the Plan Year (even if not paid in such Plan
Year) in lieu of the target bonus opportunity was used to determined
Salary.  For purposes of this Section, Salary amounts considered shall exclude
reimbursements or other expense allowances (whether or not includable in gross
income, and including but not limited to car allowances), (cash or non-cash)
fringe benefits (including but not limited to contest prizes), moving expenses,
welfare benefits (including but not limited to imputed income on life insurance
coverage, unused and/or accrued vacation pay and severance pay), and any
distribution of stock (excluding proceeds from any stock options, stock
appreciation rights, or any other stock or equity based management incentive
plan.  Salary amounts considered shall include any amounts by which the
Participant’s Salary is reduced by a salary reduction or similar arrangement
under any qualified plan described in IRC Section 401(a) or any cafeteria plan
(as described in IRC Section 125) maintained by the Company.
 
2.19           “Separation from Service” means a Participant’s termination of
employment from the Company and all Affiliates within the meaning of Code
Section 409A, including the following rules:
 
(a)           If a Participant takes a leave of absence from the Company or an
Affiliate for purposes of military leave, sick leave or other bona fide leave of
absence, the Participant’s employment will be deemed to continue for the first
six (6) months of the leave of absence, or if longer, for so long as the
Participant’s right to reemployment is provided either by statute or by
contract; provided that if the leave of absence is due to the Participant’s
medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of six months
or more, and such impairment causes the Participant to be unable to perform the
duties of his position with the Company or an Affiliate or a substantially
similar position of employment, then the leave period may be extended for up to
a total of 29 months.
 
(b)           A Participant shall be presumed to incur a Separation from Service
when the level of bona fide services provided by the Participant to the Company
and its Affiliates permanently decreases to a level of twenty percent (20%) or
less of the level of services rendered by such individual, on average, during
the immediately preceding 36 months.
 
(c)           A Participant shall be presumed to not incur a Separation from
Service when the level of bona fide services provided by the Participant to the
Company and its Affiliates continues at a rate that is at least fifty percent
(50%) of the level of services rendered by such individual, on average, during
the immediately preceding 36 months.
 
2.20           “Social Security Retirement Benefit” means the monthly amount of
the primary Social Security benefit payable, or projected to be payable, to a
Participant (regardless of whether such Social Security benefit is or has been
applied for) at his or her Normal Retirement Date.  The Social Security
Retirement Benefit shall include a benefit payable to the Participant under any
other similar retirement program sponsored by the United States government to
which the Company contributed (at least in part) or which the Company funded (in
whole or in part) by tax or similar levy.
 
2.21           “Surviving Spouse” means the spouse of a Participant on his or
her Retirement Date, who is entitled to receive payments under Section 4.04
hereof, and who survives the Participant to receive any Surviving Spouse’s
benefit payable under the Plan.  For purposes of the Plan, a “Spouse” is a
Participant’s husband or wife under a legal union recognized by applicable state
or federal law.
 
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2.22           “Target (Supplemental) Retirement Plan Trust” and “Trust” mean
any irrevocable grantor trust or trusts established by the Company with an
independent trustee for the benefit of persons entitled to receive payments
hereunder.
 
2.23           “Tax Funded” means that the interest of a Participant in the Plan
will be includable in the gross income of the Participant for federal income tax
purposes before actual receipt of Plan benefits by the Participant as a result
of the failure of the Plan to comply with Code Section 409A with respect to the
Participant.
 
2.24           “Termination for Cause” means a termination of service of the
Participant resulting from the Participant’s fraud, misappropriation,
embezzlement, or theft of Company property, conviction of a felony, or violation
of restrictive covenants contained in any employment agreement between him and
the Company, or a willful and repeated violation of published standards of
conduct of the Company, the determination of which shall be made solely by the
Company.
 
2.25           “Termination of Service” means the cessation of Participant’s
employment with the Company for any reason whatsoever, whether voluntarily or
involuntarily, including by reason of retirement, death, or disability;
provided, however, that a Participant who is entitled to long-term disability
benefits under a long-term disability plan sponsored by the Company shall not be
deemed to have incurred a Termination of Service until the earlier of the first
anniversary of the date the Participant became entitled to long-term disability
benefits, or the date the Participant no longer qualifies for long-term
disability benefits, including loss of qualification due to death.
 
2.26           “Years of Service” means years of service credited to a
Participant based on the period beginning with the Participant’s employment
commencement date, as specified in the Participant’s Agreement, and ending on
the date the Participant incurs a Termination of Service.  Nonsuccessive periods
of service of less than whole year periods of service shall be aggregated, with
12 months of service or 365 days of service equaling a whole year of
service.  In its sole discretion, the Committee may award additional Years of
Service to a Participant at any time prior to his or her Retirement Date as
specified in the Participant’s Agreement.
 
 
III.           ELIGIBILITY; PARTICIPATION
 
3.01           Eligibility.  Participation in the Plan shall be limited to
employees of the Company who meet all of the following conditions:
 
(a)           each employee must be a corporate officer or other key employee of
the Company who is designated as eligible to participate in the Plan by the
Administrative Committee.  The determination of which corporate officers and
other key employees shall be designated eligible shall be made solely by the
Committee;
 
(b)           each employee designated eligible to participate must file an
Agreement with the Company in order to become a Participant in the Plan.
 
An employee who meets all of the requirements of this Section shall become a
Participant in the Plan.  Except as otherwise provided in Section 3.02, once an
employee becomes a Participant in the Plan, he or she shall remain a Participant
until his or her Separation from Service, and thereafter until all benefit
payments, if any, to the Participant (or his or her Surviving Spouse) have been
made.
 
3.02           Continuing Eligibility.  If for any reason, a Participant’s
Salary has been reduced, or if he or she has had a material reduction in job
responsibility, job description, or job duties, his or her participation in the
Plan may be terminated as determined in the sole discretion of the
Committee.  In the event of such termination, a Participant shall be deemed to
have incurred a Termination of Service.  Unless such termination occurs on or
after the date the Participant has become eligible for Early or Normal
Retirement, no benefit shall be payable to or on behalf of the Participant under
the Plan upon the Participant’s actual Retirement Date.
 
3.03           Reemployment.  Any Participant who incurs a Termination of
Service shall not be eligible to participate in the Plan on reemployment, unless
the Committee so determines.  In such event, the Committee shall specify the
effective date of the Participant’s renewed eligibility, and the conditions of
his or her participation, including any adjustments in Years of Service, accrued
benefit earned on the date of his or her reparticipation, if any, and other
factors to reflect his or her break in continued participation.  The Committee
shall notify each reemployed Participant of his or her eligibility, of the
effective date, and the conditions of participation.
 
 
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IV.           BENEFITS
 
4.01           Retirement Benefit.  A Participant whose Termination of Service
occurs on his or her Normal Retirement Date or Early Retirement Date shall be
eligible for a retirement benefit, payable in monthly installments as provided
in Section 4.03.  The monthly benefit payable shall equal:
 
(a)           2.0% of the Participant’s Final Average Compensation, multiplied
by his or her Years of Service (up to a maximum of 30) determined as of the
Participant’s Retirement Date, less
 
(b)           the Participant’s Other Retirement Plans’ benefit; and
 
(c)           the Participant’s Social Security Retirement Benefit.
 
4.02           Benefit Commencement.  If a Participant is entitled to a
Retirement Benefit under Section 4.01, payment of his or her Retirement Benefit
shall commence on the first day of the seventh (7th) month immediately following
his or her Separation from Service.
 
4.03           Form of Benefit Payment.  An aggregate number of no more than one
hundred and eighty (180) monthly benefit payments shall be payable under the
Plan.  The first six months of benefit payments shall be accumulated and paid in
a lump sum on the first day of the seventh (7th) month following the
Participant’s Normal Retirement Date.  Monthly benefits shall continue on the
first day of each month thereafter, until the first of the following dates:
 
(a)           the last payment date immediately preceding the death of the
Participant who dies without a Surviving Spouse;
 
(b)           the last payment date immediately preceding the death of the
Surviving Spouse of the Participant; or
 
(c)           the date the one hundred and eightieth (180th) payment has been
made to the Participant and/or his or her Surviving Spouse.
 
4.04           Surviving Spouse Benefit.  The Company shall pay the Surviving
Spouse of a Participant:
 
(a)           Death During Employment.  In the event a Participant dies while
employed by the Company, but on or after the Participant has become eligible for
Early or Normal Retirement, a Surviving Spouse benefit equal to one hundred
percent (100%) if the Participant’s retirement benefit shall be payable as
provided in this subsection.  The monthly amount of the Surviving Spouse’s
benefit payable shall be calculated and determined as if the Participant had
retired on the date of his or her death.  Payment of the Surviving Spouse
benefit shall commence on the first day of the month immediately following the
date of the Participant’s death, and shall be payable until the one hundred and
eightieth (180th) monthly installment has been paid, or until the last payment
immediately preceding the Surviving Spouse’s date of death, whichever occurs
first.  No Surviving Spouse benefit shall be paid to a Participant who dies
while employed by the Company but prior to becoming eligible for Early or Normal
Retirement.
 
(b)           Death After Retirement Date.  In the event a Participant dies on
or after his or her Retirement Date, a Surviving Spouse benefit shall be payable
as provided in this subsection.  One hundred percent (100%) of the monthly
amount of any of the one hundred and eighty (180) installments payable under the
Plan remaining unpaid to the Participant on the date of his or her death, if
any, shall be payable to the Participant’s Surviving Spouse.  Payment to the
Surviving Spouse benefit shall commence on the first day of the month
immediately following the date of the Participant’s death, and shall continue
monthly until the one hundred and eightieth (180th) monthly installment has been
paid including installments paid prior to the Participant’s death, or until the
last payment immediately preceding the Surviving Spouse’s date of death,
whichever occurs first.  No benefits shall be paid upon the death of a
Participant who has no Surviving Spouse.
 
4.05           Vesting.  Except in the event of a Termination for Cause, and
except as otherwise provided in Section 3.02, each Participant who is eligible
for an Early or Normal Retirement Benefit (whether or not the Participant has
retired), shall be one hundred percent (100%) vested in an Early or Normal
Retirement Benefit, determined under Section 4.01 hereof, based on Years of
Service, Final Average Compensation, and benefits payable from Other Retirement
Plans as of any appropriate date after the Participant has become eligible for
an Early or Normal Retirement Benefit.  A Participant shall not be deemed vested
in any benefits from the Plan for any reason prior to becoming eligible for
Early or Normal Retirement.
 
4.06           Termination for Cause.  If a Participant’s Termination of Service
occurs as a result of a Termination for Cause, no benefit shall be payable under
the Plan.  Upon Termination for Cause, the provisions of Section 4.05 shall not
apply, and the Participant shall immediately cease to be eligible for any
benefit otherwise payable under Section 4.01 of the Plan.
 
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4.07           Withholding; Employment Taxes.  To the extent required by the law
in effect at the time payments are made, the Company shall withhold any taxes
required to be withheld by the federal, or any state or local, government.
If  prior to the date of distribution of any amount hereunder, the Federal
Insurance Contributions Act (FICA) tax imposed under Code Sections 3101, 3121(a)
and 3121(v)(2), where applicable, becomes due, then the Administrative Committee
may authorize a payment from the Participant’s accrued benefit equal to the
amount needed to pay the Participant’s portion of such tax, as well as
withholding taxes resulting therefrom (including the additional taxes
attributable to the pyramiding of such distributions and taxes), and the amount
of the month retirement benefit described in Section 4.01 shall be reduced
accordingly.
 
4.08           Facility of Payment.  Any benefit payable hereunder to any person
under a legal disability, or to any person who, in the judgment of the
Administrative Committee, is unable to properly administer his or her financial
affairs, may be paid to the legal representative of such person, or may be
applied for the benefit of such person in a manner which the Committee may
select.
 
 
V.           CLAIM FOR BENEFITS PROCEDURE
 
5.01           Claim for Benefits.  Any claim for benefits under the Plan shall
be made in writing to the Committee no later than 90 days following the date the
payment that is in dispute should have been made.  If such claim for benefits is
wholly or partially denied by the Committee, the Committee shall, within a
reasonable period of time, but not later than ninety (90) days after receipt of
the claim, notify the claimant of the denial of the claim.  Such notice of
denial shall be in writing and shall contain:
 
(a)           the specific reason or reasons for the denial of the claim;
 
(b)           a reference to the relevant Plan provisions upon which the denial
is based;
 
(c)           a description of any additional material or information necessary
for the claimant to perfect the claim, together with an explanation of why such
material or information is necessary; and
 
(d)           an explanation of the Plan’s claim review procedure, including the
claimant’s right to bring a suit for benefits under ERISA Section 502 if the
claimant’s appeal is denied.
 
5.02           Request for Review of a Denial of a Claim for Benefits.  Upon
receipt by the claimant of written notice of denial of the claim, the claimant
may within sixty (60) days file a written request to the Committee, requesting a
review of the denial of the claim, which review shall include a hearing if
deemed necessary by the Committee; provided that to avoid penalties under Code
Section 409A, the claimant’s appeal must be filed no later than 180 days after
the latest date the payment that is in dispute could have been timely paid
pursuant to Code Section 409A.  In connection with the claimant’s appeal of the
denial of his or her claim, he or she may review relevant documents and may
submit issues and comments in writing.
 
5.03           Decision Upon Review of Denial of Claim for Benefits.  The
Committee shall render a decision on the claim review promptly, but no more than
sixty (60) days after the receipt of the claimant’s request for review, unless
special circumstances (such as the need to hold a hearing) require an extension
of time, in which case the sixty (60) day period shall be extended to one
hundred-twenty (120) days.  Such decision shall:
 
(a)           include specific reasons for the decision;
 
(b)           be written in a manner calculated to be understood by the
claimant;
 
(c)           contain specific references to the relevant Plan provisions upon
which the decision is based; and
 
(d)           contain notification to the claimant of his or her right to bring
suit for benefits under ERISA Section 502.
 
The decision of the Committee shall be final and binding in all respects on both
the Company and the claimant.  Legal action against the Plan may not be
commenced more than 180 days after the Committee notifies the claimant of the
determination upon review, or if the Committee fails to timely notify the
claimant pursuant to the provisions of the Plan, 180 days after the latest date
the Committee could have timely notified the claimant.
 
 
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VI.           ADMINISTRATION
 
6.01           Plan Administrative Committee.  The Plan shall be administered by
the Compensation Committee of the Board of Directors of the Company, which shall
be the Administrative Committee of the Plan.  The Administrative Committee may
assign duties to an officer or other employees of the Company, and delegate such
duties as it sees fit.  No member of the Committee shall vote or act on matters
relating solely to himself or herself, or his or her Plan benefits.
 
6.02           General Rights, Powers and Duties of Administrative
Committee.  The Administrative Committee shall be responsible for the
management, operation and administration of the Plan in its discretion.  In
addition to any powers, rights, and duties set forth elsewhere in the Plan, it
shall have the following discretionary powers and duties to:
 
(a)           adopt such rules and regulations consistent with the provisions of
the Plan as it deems necessary for the proper and efficient administration of
the Plan;
 
(b)           administer the Plan in accordance with its terms and any rules and
regulations it establishes;
 
(c)           maintain records concerning the Plan sufficient to prepare
reports, returns, and other information required by the Plan or by law;
 
(d)           construe and interpret the Plan, and to resolve all questions
arising under the Plan;
 
(e)           direct the Company to pay benefits under the Plan, and to give
such other directions and instructions as may be necessary for the proper
administration of the Plan;
 
(f)           employ or retain agents, attorneys, actuaries, accountants or
other persons who may also be employed by or represent the Company; and
 
(g)           be responsible for the preparation, filing, and disclosure on
behalf of the Plan of such documents and reports as are required by any
applicable federal or state law.
 
6.03           Information to be Furnished to Administrative Committee.  The
records of the Company shall be determinative of each Participant’s period of
employment, Retirement Date, Termination of Service and the reason therefor,
disability, leave of absence, Years of Service, personal data, and Final Average
Compensation.  Participants and their Surviving Spouse shall furnish to the
Committee such evidence, data or information, and execute such documents as the
Committee requests.
 
6.04           Responsibility.  No member of the Committee shall be liable to
any person for any action taken or omitted in connection with the administration
of this Plan unless attributable to his or her own fraud or willful misconduct;
nor shall the Company be liable to any person for any such action unless
attributable to fraud or willful misconduct on the part of a director, officer
or employee of the Company.  Further, the Company shall hold harmless and defend
and indemnify any individual in the employment of the Company and any Director
of the Company against any claim, action, or liability asserted against him in
connection with any action or failure to act regarding the Plan, except as and
to the extent such liability may be based upon the individual’s own willful
misconduct or fraud.  This indemnification shall not duplicate, but may
supplement, any coverage available under any applicable insurance
coverage.  This indemnification provided hereunder shall continue as to a person
who has ceased serving on the Committee or as an officer, employee, or director
of the Company, and such person’s rights shall inure to the benefit of his or
her heirs and representatives.
 
 
VII.           AMENDMENT AND TERMINATION
 
7.01           Amendment.  The Plan may be amended in whole or in part by the
Company at any time; provided, however, that the Committee may amend the Plan if
the amendments are (a) within the scope of the law, (b) will not have a material
financial effect on the Company, and (c) are either immaterial changes in the
provisions of the Plan or technical changes required by applicable law.  Notice
of any material amendment shall be given in writing to the Administrative
Committee or the Company, as appropriate, and to each Participant and each
Surviving Spouse of a deceased Participant.  No amendment shall retroactively
decrease a Participant’s vested accrued benefit determined as of the amendment
date pursuant to Section 4.05.
 
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7.02           Company’s Right to Terminate.  The Company reserves the sole
right to terminate the Plan at any time.  Termination of the Plan shall not
decrease a Participant’s vested benefit determined as of the termination date
pursuant to Section 4.05.  Upon termination of the Plan, the Company may provide
that the single sum Actuarial Equivalent present value of the Participants’
vested accrued benefits, determined as of the termination date, be paid in a
single lump sum to the extent permitted by and in accordance with Code Section
409A.
 
7.03           Special Termination.  Any other provision of the Plan to the
contrary notwithstanding, the Plan shall terminate if the Plan is held to be
ERISA Funded or Tax Funded by a federal court, and appeals from that holding are
no longer timely or have been exhausted.  The Company may terminate the Plan if
it determines, based on a legal opinion which is satisfactory to the Company,
that either judicial authority or the opinion of the U.S. Department of Labor,
Treasury, Department or Internal Revenue Service (as expressed in proposed or
final regulations, advisory opinions or rulings, or similar administrative
announcements) creates a significant risk that the Plan will be held to be ERISA
Funded or Tax Funded, and failure to so terminate the Plan could subject the
Company or the Participants to material penalties or the inclusion of Plan
benefits in taxable income prior to actual receipt of Plan benefits.  Upon any
such termination, the Company may:
 
(a)           transfer the rights and obligations of the Participants and the
Company to a new plan established by the Company, which is not deemed to be
ERISA Funded or Tax Funded, but which is similar in all other respect to this
Plan, if the Company determines that it is possible to establish such a Plan;
 
(b)           if the Company, in its sole discretion, determines that it is not
possible to establish the Plan in (a) above, the Company shall pay to each
Participant a lump sum benefit equal to the Economic Equivalent of his or her
vested benefit determined pursuant to Section 4.05 if and to the extent such a
lump sum payment is permitted by Code Section 409A; or
 
(c)           pay a lump sum benefit equal to the Actuarial Equivalent of a
Participant’s vested benefit determined pursuant to Section 4.05 to the extent
that a federal court has held that the interest of the Participant in the Plan
is includable in the gross income of the Participant for federal income tax
purposes prior to actual payment of Plan benefits as a result of the Plan’s
failure to comply with Code Section 409A with respect to such Participant.  The
Actuarial Equivalent of any remaining vested accrued benefit shall remain as an
obligation of the Company, to be paid to the Participant as provided in the
Plan.
 
 
VIII.           MISCELLANEOUS
 
8.01           Separation of Plan; No Implied Rights.  The Plan shall not
operate to increase any benefit payable to or on behalf of a Participant (or his
or her Surviving Spouse) from any other plan maintained by the Company.  Neither
the establishment of the Plan nor any amendment thereof shall be construed as
giving any Participant, Surviving Spouse, or any other person any legal or
equitable right unless such right shall be specifically provided for in the Plan
or conferred by specific action of the Company in accordance with the terms and
provisions of the Plan.  Except as expressly provided in the Plan, the Company
shall not be required or be liable to make any payment under the Plan.
 
8.02           No Right to Company Assets.  Neither the Participant nor any
other person shall acquire by reason of the Plan any right in or title to any
assets, funds or property of the Company whatsoever, including, without limiting
the generality of the foregoing, any specific funds, assets or other property
which the Company, in its sole discretion, may set aside in anticipation of  a
liability hereunder.  Any benefits which become payable hereunder shall be paid
from the general assets of the Company or the Trust.  The Participant shall have
only a contractual right to the amounts, if any, payable hereunder, unsecured by
any asset of the Company.  Nothing contained in the Plan constitutes a guarantee
by the Company that the assets of the Company shall be sufficient to pay any
benefits to any person.
 
8.03           No Employment Rights.  Nothing herein shall constitute a contract
of employment or of continuing service or in any manner obligate the Company to
continue the services of the Participant, or obligate the Participant to
continue in the service of the Company, or as a limitation of the right of the
Company to discharge any of its employees, with or without cause.  Nothing
herein shall be construed as fixing or regulating the compensation or other
remuneration payable to the Participant.
 
8.04           Offset.  If, at the time payments or installments of payments are
to be made hereunder, the Participant or the Surviving Spouse or both are
indebted or obligated to the Company, then the payments remaining to be made to
the Participant or the Surviving Spouse or both may, at the discretion of the
Company, be reduced by the amount of such indebtedness or obligation, provided,
however, that an election by the Company not to reduce any such payment or
payments shall not constitute a waiver of its claim for such indebtedness or
obligation.
 
8.05           Protective Provisions.  In order to facilitate the payment of
benefits hereunder, each employee designated eligible shall cooperate with the
Company by furnishing any and all information requested by the Company, and
taking such other actions as may be requested by the Company.  If the employee
refuses to cooperate, he or she shall not become a Participant in the Plan and
the Company shall have no further obligation to him or her under the Plan.  In
such event, no benefit shall be payable to the Participant or his or her
Surviving Spouse.
 
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8.06           Non-assignability.  Neither the Participant nor any other person
shall have any voluntary or involuntary right to commute, sell, assign, pledge,
anticipate, mortgage or otherwise encumber, transfer, hypothecate or convey in
advance of actual receipt the amounts, if any, payable hereunder, or any part
thereof, which are expressly declared to be unassignable and
non-transferrable.  No part of the amounts payable shall be, prior to actual
payment, subject to seizure or sequestration for the payment of any debts,
judgments, alimony or separate maintenance owed by the Participant or any other
person, or be transferrable by operation of law in the event of the
Participant’s or any other person’s bankruptcy or insolvency.
 
8.07           Notice.  Any notice required or permitted to be given under the
Plan shall be sufficient if in writing and hand delivered, or sent by registered
or certified mail to the last known address of the Participant if to the
Participant, or, if given to the Company, to the principal office of the
Company, directed to the attention of the Administrative Committee.  Such notice
shall be deemed given as of the date of delivery, or, if delivery is made by
mail, as of the date shown on the postmark or the receipt for registration or
certification.
 
8.08           Governing Laws.  The Plan shall be construed and administered
according to the laws of the State of Wisconsin, without reference to conflict
of law principles thereof.  The Plan is intended to be a deferred compensation
plan that complies with Code Section 409A, and the Plan shall be construed and
interpreted in a manner that will cause any payment hereunder that is not exempt
from Code Section 409A to meet the requirements thereof such that no additional
tax will be due under Code Section 409A on such payment.
 
8.09           Target (Supplemental) Retirement Plan Trust.  i)  The Company
shall establish a Trust or Trusts with (an) independent trustee(s), and shall
comply with the terms of the Trust(s).  The Company may transfer to the
trustee(s) an amount of cash, marketable securities, or other property
acceptable to the trustee(s) (“Trust Property”) determined by Regal Beloit
Corporation, in its sole discretion, as it deems necessary or
appropriate.  Trust Property so transferred shall be held, managed, and
disbursed by the trustee(s) in accordance with the terms of the Trust(s).  To
the extent that Trust Property shall be used to pay the Company’s obligations
under the Plan, such payments shall discharge obligations of the Company;
however, the Company shall continue to be liable for amounts not paid by the
Trust(s).  Trust Property will nevertheless be subject to claims of the
Company’s creditors in the event of bankruptcy or insolvency, and the
Participant’s rights under the Plan and Trust(s) shall at all times be subject
to the provisions of Section 8.02.
 
(b)           Upon a Change of Control, Company shall, as soon as possible, but
in no event longer than thirty (30) days following the Change of Control, as
defined herein, make an irrevocable contribution to the Trust in an amount that
is sufficient to pay each vested Plan Participant or their Surviving Spouses,
the vested benefits to which Plan Participants or their Surviving Spouses would
be entitled pursuant to the terms of the Plan as of the date on which the Change
of Control occurred; provided such contribution is not prohibited by Code
Section 409A(b)(2) or (3).  A Participant’s or Surviving Spouse’s vested benefit
shall be determined pursuant to Section 4.05.
 
IN WITNESS WHEREOF, the undersigned has executed this Plan, as amended and
restated effective January 1, 2010 for and on behalf of the Company.
 
REGAL BELOIT CORPORATION
 

 
By:           /s/Paul J.
Jones                                                      
                         Its: Secretary
 

 
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