EXHIBIT 10.4

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Restricted Stock Units Terms and Conditions

1. Award of Restricted Stock Units. The Executive Organization & Compensation
Committee (the “Committee”) of the Board of Directors of Applied Industrial
Technologies, Inc. (“Applied”) on the Grant Date awarded you a certain number of
restricted stock units (the “RSUs”). Such award represents your right to receive
an equal number of shares of Applied common stock (“Shares”), upon the
expiration of the Restriction Period (as defined in Section 3 hereof). The terms
and conditions of the RSUs as set forth herein (the “Terms”) together with the
Applied Industrial Technologies, Inc. 2007 Long-Term Performance Plan (the
“Plan”) govern your rights with respect to the RSUs. Notwithstanding the
foregoing, however, in the event of any conflict between the provisions of the
Plan and the Terms, the provisions of the Plan shall govern. Moreover, it should
be noted that unless otherwise provided herein, capitalized words in the Terms
shall have the same meanings as set forth in the Plan.

2. Rights during Restriction Period. You shall not have the right to sell,
exchange, transfer, pledge, hypothecate, or otherwise encumber or dispose of the
RSUs until all conditions with respect to vesting and distribution have been
met. Nevertheless, during the Restriction Period and so long as no forfeiture
has occurred, you shall be entitled to receive cash payments equal to the
dividends and cash distributions paid on Shares underlying the RSUs (“Dividend
Equivalents”) to the same extent and on the same date as if each RSU were a
Share; provided, however, that no Dividend Equivalents shall be payable to you
with respect to dividends or distributions the record date for which occurs on
or after (i) the date on which a forfeiture of the RSUs has occurred, (ii) the
date on which the Restriction Period has expired, or (iii) the date on which
issuance of Shares to you has occurred. You shall not have voting rights with
respect to the RSUs and, until the issuance of Shares in settlement of the RSUs,
you shall not be treated as a shareholder with respect to the Shares.

3. Restriction Period. The term “Restriction Period” means the earlier of (a)(i)
with respect to one-third of the RSUs awarded to you hereunder, the period from
the Grant Date until the 1st annual anniversary of the Grant Date, (ii) with
respect to an additional one-third of the RSUs awarded to you hereunder, the
period from the Grant Date until the 2nd annual anniversary of the Grant Date,
and (iii) with respect to the final one-third of the RSUs awarded to you
hereunder, the period from the Grant Date until the 3rd annual anniversary of
the Grant Date or (b) with respect to 100% of the RSUs awarded to you hereunder,
the period from the Grant Date to the date that your employment with Applied is
terminated, either by you for “Good Reason” (as hereinafter defined but, for
purposes of this section, after eliminating references in such definition to
“immediately prior to a Change in Control”) or by the Company “Without Cause.”
The term “Without Cause” shall mean termination of your employment by Applied
for reasons other than your death, Retirement, Disability or Cause (each, as
hereinafter defined).

4. Vesting. Except as specifically provided otherwise in Sections 5 and 6, you
will be vested in the applicable percentage of the RSUs granted to you hereunder
as of the end of the applicable Restriction Period; provided, however, that in
the event you incur a Separation from Service during the Restriction Period
after attaining age 55 and completing at least ten years of service with
Applied, you will be

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vested at the end of the Restriction Period in a pro rata portion of the RSUs
equal to a fraction the numerator of which is the number of fiscal quarters
(including a portion of a quarter) elapsed in the Restriction Period prior to
the date of such Separation from Service and the denominator of which is twelve.

5. Separation from Service. Notwithstanding the provisions of Section 4, but
subject to the provisions of paragraphs (a) and (b) hereunder, if, during any
Restriction Period, you incur a Separation from Service (as defined in
Section 409A) from Applied due to death or “Disability” (as defined under
Section 409A) then (i) you (or your beneficiary designated to Applied in
writing) shall be vested in 100% of the RSUs awarded to you hereunder. In the
event, however, that you, during the Restriction Period, incur a Separation from
Service from Applied for any reason other than (i) those specifically set forth
above or in Section 6, or (ii) termination after attaining age 55 and completing
at least ten years of service with Applied, then the portion of the award of
RSUs hereunder still subject to a Restriction Period shall be forfeited and no
amount shall be due or payable to you under the Terms.

Because awards of RSUs are intended to create an incentive for recipients to act
in Applied’s best interests, notwithstanding anything in the Terms to the
contrary:

(a) Your award of RSUs may be terminated or rescinded, and if applicable, you
may be required immediately to repay all Shares (and any dividends,
distributions, and Dividend Equivalents thereon) issued pursuant to the award of
RSUs hereunder within the previous six months (or any proceeds thereof), if the
Committee determines, in good faith, that during your employment with Applied or
during the period ending six months following the your Separation from Service,
you committed an act inimical to Applied’s interests. Acts inimical to Applied’s
interest shall include willful inattention to duty; willful violation of
Applied’s published policies; acts of fraud or dishonesty involving Applied’s
business; solicitation of Applied’s employees, customers, or vendors to
terminate or alter their relationship with Applied to Applied’s detriment;
unauthorized use or disclosure of information regarding Applied’s business,
employees, customers, or vendors; and competition with Applied. All
determinations by the Committee shall be effective as of the time of your act.

(b) The Committee may, in its sole discretion, require you immediately to repay
all Shares (and any dividends, distributions, and Dividend Equivalents thereon)
issued pursuant to the award of RSUs hereunder within the previous 36 months (or
any proceeds thereof) if (I) Applied restates its historical consolidated
financial statements and (II) the Committee determines, in good faith, that
(x) the restatement is a result of your, or another executive officer’s, willful
misconduct that is unethical or illegal, and (y) your earnings pursuant to the
award were based on materially inaccurate financial statements or materially
inaccurate performance metrics that were invalidated by the restatement.

6. Change in Control. Notwithstanding the provisions of Sections 4 and 5, in the
event your employment with Applied is terminated during the Restriction Period
and within the two year period immediately following any Change in Control of
Applied either by you for “Good Reason” or by Applied “Without Cause”, then all
of the RSUs awarded hereunder to you shall be 100% vested.

For purposes of the RSUs, “Cause” shall mean (i) the willful and continued
failure by you to perform substantially your duties with Applied or one of its
affiliates (other than for Disability or Good Reason), after a written demand
for substantial performance is delivered to you by the Board or the Chief
Executive Officer of Applied which specifically identifies the manner in which
the Board or Chief Executive Officer believes that you have not substantially
performed your duties, or (ii) the willful engagement by you in illegal conduct
or gross misconduct involving moral turpitude that is materially and
demonstrably injurious to Applied; provided, however, that no act or failure to
act shall be considered “willful” unless it is done, or omitted to be done, in
bad faith or without your reasonable belief that such action or omission was in
the best interests of Applied. Any act, or failure to act, based upon authority
given you pursuant to a resolution duly adopted by the

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Board or upon the instructions of the Chief Executive Officer or a senior
officer of Applied or based upon the advice of counsel for Applied shall be
conclusively presumed to be done, or omitted to be done, in good faith and in
the best interests of Applied. Termination of your employment with Applied shall
not be deemed to be for Cause unless and until there shall have been delivered
to you a copy of a resolution duly adopted by the affirmative vote of not less
than three-quarters of the entire membership of the Board at a meeting of the
Board called and held for such purpose (after reasonable notice is provided to
you and you are given an opportunity, together with counsel, to be heard before
the Board), finding that, in the good faith opinion of the Board, you are guilty
of the conduct described in subparagraph (i) or (ii) above, and specifying the
particulars thereof in detail.

For purposes of the RSUs, “Good Reason” shall mean a separation from service
that occurs no later than two years after (i) a material diminution in your
authority, duties, or responsibilities, (ii) a material diminution in the
authority, duties, or responsibilities of the person to whom you reported
immediately prior to a Change in Control, (iii) a material diminution by Applied
of your annual base salary that was provided to you by Applied immediately prior
to the Change in Control, (iv) a material change in the geographic location
where you provide service to Applied, or (v) any failure of any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business and/or assets of Applied, by agreement
in form and substance satisfactory to you, to expressly assume and agree to
comply with these Terms in the same manner and to the same extent that Applied
would be required to perform it if no such succession had taken place; provided
further, that, Good Reason shall not have occurred unless you give Applied
notice within 90 days of the initial existence of the condition claimed by you
in good faith to constitute Good Reason and Applied has at least 30 days in
which to remedy the condition. For purposes of this Agreement, “Good Reason”
shall not exist if you have given your prior written consent to any of the
events that would otherwise constitute “Good Reason”.

Notwithstanding the definition in the Plan, a “Change in Control” of Applied
shall have occurred for purposes of the RSUs (to the extent the RSUs do not
constitute nonqualified deferred compensation within the meaning of
Section 409A) when any of the following events shall occur:

(i) Applied is merged, consolidated or reorganized into or with another
corporation or other legal person, and immediately after such merger,
consolidation or reorganization less than a majority of the combined voting
power of the then-outstanding securities of such corporation or person
immediately after such transaction are held in the aggregate by the holders of
Voting Stock (as that term is hereafter defined) of Applied immediately prior to
such transaction;

(ii) Applied sells all or substantially all of its assets to any other
corporation or other legal person, and, immediately after such sale, less than a
majority of the combined voting power of the then-outstanding securities of such
corporation or person immediately after such sale are held in the aggregate by
the holders of Voting Stock of Applied immediately prior to such sale;

(iii) There is a report filed or required to be filed on Schedule 13D or
Schedule TO (or any successor schedule, form or report), each as promulgated
pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), disclosing that any person (as the term “person” is used in
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) has become the
beneficial owner (as the term “beneficial owner” is defined under Rule 13d-3 or
any successor rule or regulation promulgated under the Exchange Act) of
securities representing 30% or more of the combined voting power of the
then-outstanding securities entitled to vote generally in the election of
directors of Applied (“Voting Stock”);

(iv) Applied files a report or proxy statement with the Securities and Exchange
Commission pursuant to the Exchange Act disclosing in response to Form 8-K or
Schedule 14A (or any

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successor schedule, form or report or item therein) that a change in control of
Applied has occurred pursuant to any then-existing contract or transaction; or

(v) If during any period of two consecutive years, individuals who at the
beginning of any such period constitute the directors of Applied cease for any
reason to constitute at least a majority thereof, provided, however, that for
purposes of this clause (v), each director who is first elected, or first
nominated for election by Applied’s stockholders by a vote of at least
two-thirds of the directors of Applied (or a committee thereof) then still in
office who were directors of Applied at the beginning of any such period will be
deemed to have been a director of Applied at the beginning of such period.

Notwithstanding the foregoing provisions of (iii) or (iv) hereof, unless
otherwise determined in a specific case by majority vote of the Board, a “Change
in Control” shall not be deemed to have occurred for purposes of this Award
solely because (i) Applied, (ii) an entity in which Applied directly or
indirectly beneficially owns 50% or more of the voting securities or interest,
or (iii) any Applied-sponsored employee stock ownership plan or any other
employee benefit plan of Applied, either files or becomes obligated to file a
report or a proxy statement under or in response to Schedule 13D, Schedule TO,
Form 8-K or Schedule 14A (or any successor schedule, form or report or item
therein) under the Exchange Act, disclosing beneficial ownership by it of shares
of Voting Stock, whether in excess of 30% or otherwise, or because Applied
reports that a change in control of Applied has occurred or will occur in the
future by reason of such beneficial ownership.

In addition, following a Change in Control of Applied, no provision hereof shall
operate to reduce any time frame or to limit any economic benefit to which you
are entitled with respect to the RSUs or under the Plan.

To the extent the RSUs constitute nonqualified deferred compensation within the
meaning of Section 409A, a “Change in Control” of Applied shall mean a change in
the ownership or effective control of Applied or a change in the ownership of a
substantial portion of the assets of Applied that constitutes a “change in
control” under Section 409A.

In addition, to the extent the RSUs are subject to Section 409A, Shares will be
issued and distributed to you within 90 calendar days after vesting; provided
that if such 90-day period begins in one calendar year and ends in another, you
shall not have the right to designate the calendar year of payment.
Notwithstanding the foregoing, if you are a Specified Employee, a distribution
due to a separation from service may not be made until the 30-day period
commencing with the first day of the seventh month following such Separation
from Service or, if earlier, the date of your death, except in each case as may
be otherwise permitted under Section 409A.

7. Adjustment of RSUs for Certain Events. In the event of a stock split, stock
dividend, combination, reclassification, recapitalization, merger,
consolidation, exchange, spin-off, spin-out, or other distribution of assets to
shareholders, or other similar event or change in capitalization such that
shares of Applied common stock are changed into or become exchangeable for a
different number of shares, thereafter the number of RSUs will be increased or
decreased, as the case may be, in direct proportion to the increase or decrease
in the number of shares of common stock by reason of such change in corporate
structure; provided, however, that the number of RSUs shall always be a whole
number. If there occurs a stock split, combination, reclassification,
recapitalization, merger, consolidation, as a result of which shares of Applied
common stock are converted solely into cash or the right to receive cash, then
the RSUs shall thereafter be converted into the right to receive cash in an
amount equal to the cash that the number of shares of Applied common stock
corresponding to the RSU would be

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converted. If there occurs any other change in the number or kind of outstanding
shares of common stock or other Applied securities, or of any shares of stock or
other securities into which such shares of common stock shall have been changed
or for which they shall have been exchanged, then Applied may adjust the number
or kind of RSUs or other securities into which the RSUs may be settled, as the
Committee, in its sole discretion, may determine is equitable, and such
adjustment so made shall be effective and binding for all purposes.

8. Settlement of Award and Distribution of Shares. Your award of RSUs hereunder
shall be settled in whole Shares. Fractional Shares shall not be issuable
hereunder and any fractional Share shall be disregarded. Except as specifically
provided otherwise in this Section 8, Shares subject to an award of RSUs
hereunder shall only be issued and distributed to you in a single sum of whole
Shares within the 75-day period after the end of the Restriction Period.
Notwithstanding the foregoing, in the event that your RSUs become vested due to
death, Disability or a Change in Control, the award of RSUs hereunder shall be
settled in a single sum of whole Shares within the 75-day period after such
vesting. In the event that any such 75-day period begins in one calendar year
and ends in another, you (or your beneficiary as the case may be) shall not have
the right to designate the calendar year of payment. Moreover, notwithstanding
the foregoing, if you are a Specified Employee, a distribution of Shares may not
be made until within the 30-day period commencing with the first day of the
seventh month following the month of any Separation from Service for reasons
other than Disability or a Change in Control, or, if earlier, your death, except
as maybe otherwise permitted under Section 409A.

9. Payment of Taxes. Upon the vesting of the RSUs, Applied shall withhold Shares
from your award for any federal, state or local taxes of any kind required by
law to be withheld by Applied attributable to the award.

10. Section 409A Compliance. To the extent applicable, it is intended the Terms
and the award of RSUs shall comply with or be exempt from the provisions of
Section 409A and any interpretations of these terms shall be consistent with
such intent.

11. Administration of the Plan. The Committee shall have conclusive authority,
subject to the express provisions of the Plan as in effect from time to time and
the Terms, to construe the Terms and the Plan, and to establish, amend, and
rescind rules and regulations for the Plan’s administration. The Committee may
correct any defect or supply any omission or reconcile any inconsistency in the
Terms in the manner and to the extent it shall deem expedient to carry the Plan
into effect, and it shall be the sole and final judge of such expediency.
Applied’s Board of Directors (the “Board”) may from time to time grant to the
Committee such further powers and authority as the Board shall determine to be
necessary or desirable. Notwithstanding any other provision of these terms, any
amendment, construction, establishment, rescission or correction of the type
referred to above which is made or adopted following a Change in Control, and
which amendment, construction, establishment or correction adversely affects
your rights hereunder, shall be in writing and shall be effective only with your
express and prior written consent .

12. Relationship to the Plan. The Terms are subject to the provisions of the
Plan and any administrative policies adopted by the Committee. If there is any
inconsistency between the Terms and the Plan or such policies, the Plan and the
policies, in that order, shall govern. References in the Terms to Applied shall
include Applied’s subsidiaries.

13. Severability. The provisions of the Terms are severable and if any one or
more provisions are determined to be illegal or otherwise unenforceable, in
whole or in part, the remaining provisions shall nevertheless be binding and
enforceable.

14. No Guarantee of Employment. The Terms and your award shall not confer upon
you any rights whatsoever other than those expressly set forth herein, in the
Plan or in policies adopted by the

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Committee. Nothing in the Terms shall (i) interfere with or limit in any way
Applied’s right to terminate your employment at any time, (ii) confer upon you
any right to continued employment with Applied, or (iii) create any contractual
or other right to receive additional awards or other Plan benefits in the
future.

15. Requirements of Law. The granting of the RSUs hereunder shall be subject to
all applicable laws, rules and regulations, and to such approvals by any
governmental agency, national securities exchange, or automated quotation system
may be required. Notwithstanding any other provision of the Plan or the Terms,
Applied shall not be obligated to issue, deliver or transfer any Shares, make
any distribution of benefits under the Plan or the Terms, or take any other
action, unless such delivery, distribution, or action, unless such delivery,
distribution, or action is in compliance with all applicable laws, rules and
regulations (including, but not limited to, the requirements of the Securities
Act and Section 409A).

16. Successors. All obligations of Applied under the Terms with respect to the
RSUs shall be binding upon any successor to Applied, whether the existence of
such successor is the result of a direct or indirect purchase, merger,
consolidation, or otherwise, of all, or substantially all, of the business
and/or assets of Applied. Notwithstanding the provisions of Section 4, in the
event any such successor does not agree to be bound by the Terms, the RSUs
granted hereunder shall immediately become vested.

17. Applicable Law. The validity, construction, interpretation and
enforceability of these Terms shall be determined and governed by the laws of
the State of Ohio without giving effect to the principles of conflicts of law.

18. Tax Matters. Applied has made no warranties or representations to you with
respect to the tax consequences (including but not limited to income tax
consequences) related to the RSUs or the issuance, transfer or disposition of
Shares pursuant to the RSUs, and you have been advised to consult with your
attorney, accountant and/or tax advisor regarding the RSUs. Moreover, you
acknowledge that Applied has no responsibility to take or refrain from taking
any actions in order to achieve a certain tax result for you.

(October 2011)