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                                                                     EXHIBIT 4.1


                            WOODWARD GOVERNOR COMPANY
                             EXECUTIVE BENEFIT PLAN

                            EFFECTIVE JANUARY 1, 2004

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I.                PURPOSE AND EFFECTIVE DATE............................................................1

     1.1.            Purpose............................................................................1
     1.2.            Effective Date.....................................................................1
     1.3.            History............................................................................1

II.               DEFINITIONS...........................................................................1

     2.1.            "Account"..........................................................................1
     2.2.            "Administrator"....................................................................2
     2.3.            "Affiliate"........................................................................2
     2.4.            "Base Salary"......................................................................2
     2.5.            "Beneficiary"......................................................................2
     2.6.            "Board"............................................................................2
     2.7.            "Bonus"............................................................................2
     2.8.            "Change in Control"................................................................3
     2.9.            "Code".............................................................................4
     2.10.           "Company"..........................................................................4
     2.11.           "Deferral Contribution Amounts"....................................................5
     2.12.           "Deferral Election"................................................................5
     2.13.           "Disability".......................................................................5
     2.14.           "Distribution Election"............................................................5
     2.15.           "Early Retirement Date"............................................................5
     2.16.           "Election Period"..................................................................5
     2.17.           "Eligible Member"..................................................................5
     2.18.           "Exchange Act".....................................................................5
     2.19.           "FICA".............................................................................5
     2.20.           "Investment Fund or Funds".........................................................5
     2.21.           "Normal Retirement Date"...........................................................6
     2.22.           "Participant"......................................................................6
     2.23.           "Plan".............................................................................6
     2.24.           "Plan Year"........................................................................6
     2.25.           "Prior Account Balance"............................................................6
     2.26.           "Retirement".......................................................................6
     2.27.           "Supplemental Benefit Amount"......................................................6
     2.28.           "Valuation Date"...................................................................6

III.              PARTICIPATION.........................................................................7

     3.1.            Participation......................................................................7
     3.2.            ERISA Exemption....................................................................7

IV.               DEFERRAL CONTRIBUTION AMOUNTS.........................................................7

     4.1.            Permissible Deferrals under the Plan...............................................7
             (a)     Deferral of Base Salary............................................................7
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             (b)     Deferral of Bonus..................................................................7
     4.2.            Deferral Elections.................................................................8
     4.3.            Crediting of Deferral Elections....................................................9
     4.4.            Vesting............................................................................9
     4.5.            Deferred Contribution Amounts Subject to FICA at Time of Deferral..................9

V.                SUPPLEMENTAL BENEFIT AMOUNT...........................................................9

     5.1.            Computation of Supplemental Benefit Amount.........................................9
     5.2.            Vesting...........................................................................10
     5.3.            Crediting of Supplemental Benefit Amount..........................................10

VI.               ACCOUNTS AND INVESTMENTS.............................................................10

     6.1.            Valuation of Accounts.............................................................10
     6.2.            Hypothetical Investment Funds.....................................................11
     6.3.            Crediting of Investment Return....................................................11
     6.4.            Changing Investment Fund Options..................................................12
     6.5.            Investment Alternatives After Death...............................................12

VII.              PAYMENT OF BENEFITS..................................................................12

     7.1.            Distribution at Specific Future Date..............................................12
     7.2.            Distribution Upon Retirement or Disability........................................12
     7.3.            Distribution On Other Termination of Employment...................................13
     7.4.            Unscheduled Withdrawal............................................................13
     7.5.            Unforeseeable Emergency...........................................................14
     7.6.            Time and Form of Elections........................................................14
     7.7.            Form of Payment and Withholding...................................................14

VII.              DEATH BENEFITS.......................................................................14

     8.1.            Death Prior to Commencement of Benefits...........................................14
     8.2.            Death After Commencement of Benefits..............................................14
     8.3.            Administrator Discretion Regarding Form...........................................14

IX.               ADMINISTRATION.......................................................................15

     9.1.            Authority of Administrator........................................................15
     9.2.            Participant's Duty to Furnish Information.........................................15
     9.3.            Interested Member of Administrator................................................15
     9.4.            Indemnification...................................................................15
     9.5.            Claims Procedure..................................................................15

X.                AMENDMENT AND TERMINATION............................................................16
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XI.               MISCELLANEOUS........................................................................16

     11.1.           No Implied Rights; Rights on Termination of Service...............................16
     11.2.           No Employment Rights..............................................................16
     11.3.           Nature of the Plan................................................................17
             (a)     Unfunded Plan.....................................................................17
             (b)     Exception for Change in Control...................................................17
     11.4.           Nontransferability................................................................17
     11.5.           Successors and Assigns............................................................18
     11.6.           Payment with Respect to Incapacitated Persons.....................................18
     11.7.           Arbitration.......................................................................18
     11.8.           Gender and Number.................................................................18
     11.9.           Headings..........................................................................18
     11.10.          Severability......................................................................18
     11.11.          Effect on Other Employee Benefit Plans............................................19
     11.12.          Non-U.S. Participants.............................................................19
     11.13.          Applicable Law....................................................................19
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                            WOODWARD GOVERNOR COMPANY
                             EXECUTIVE BENEFIT PLAN

I.      PURPOSE AND EFFECTIVE DATE.

        1.1.    PURPOSE. The Woodward Governor Company Executive Benefit Plan
                has been established by Woodward Governor Company to attract and
                retain certain key members by:

                (a)     providing a tax-deferred capital accumulation vehicle to
                        supplement such members' individual retirement
                        contributions, thereby encouraging savings for
                        retirement, and

                (b)     supplementing such members' retirement income available
                        under the Woodward Governor Company Retirement Savings
                        Plan (the "RSP"), which is otherwise limited pursuant to
                        the rules and regulations of the Internal Revenue Code
                        of 1986, as amended.

        1.2.    EFFECTIVE DATE. The Plan was originally effective January 1,
                2001. This amendment and restatement of the Plan is effective
                January 1, 2004. The Plan shall remain in effect until
                terminated in accordance with Article X.

        1.3.    HISTORY. The Woodward Governor Company Amended and Restated
                Unfunded Deferred Compensation Plan No.1 (the "DC Plan No. 1")
                and the Woodward Governor Company Unfunded Deferred Compensation
                Plan No. 2 (the "DC Plan No. 2) were merged with and into this
                Plan effective January 1, 2001. The Plan is intended to be an
                amendment, restatement and continuation of such plans for
                periods following the merger date.

II.     DEFINITIONS.

        When used in the Plan and initially capitalized, the following words and
        phrases shall have the meanings indicated:

        2.1.    "ACCOUNT" means the recordkeeping account established for each
                Participant in the Plan for purposes of accounting for the
                amount of the Participant's:

                (a)     Deferral Contribution Amounts deferred and credited in
                        accordance with Article IV each year, if any,

                (b)     Supplemental Benefit Amounts determined and credited in
                        accordance with Article V each year, if any, and

                (c)     account balance, if any, under the prior DC Plan No. 1
                        and/or prior DC Plan No. 2 on the day immediately
                        preceding the original effective date of this Plan,

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                all adjusted periodically to reflect the hypothetical investment
                return on such amounts in accordance with Article VI and
                distributions in accordance with Article VII.

        2.2.    "ADMINISTRATOR" means the Compensation Committee or such other
                individual or committee appointed and delegated by the Board to
                administer the Plan in accordance with Article IX. To the extent
                so delegated, the term "Administrator" hereunder shall be deemed
                to refer to such individual or committee. The Compensation
                Committee shall take such actions it deems necessary or
                desirable to ensure that such individual or committee has
                sufficient and appropriate authority for carrying out the intent
                and purpose of the Plan.

        2.3.    "AFFILIATE" means:

                (a)     any corporation, partnership, joint venture, trust,
                        association or other business enterprise which is a
                        member of the same controlled group of corporations,
                        trades or businesses as the Company within the meaning
                        of Code Section 414, and

                (b)     any other entity that is designated as an Affiliate by
                        the Board.

        2.4.    "BASE SALARY" means a Participant's base salary in effect for a
                given year as reflected in the personnel records of the Company.

        2.5.    "BENEFICIARY" means the person or entity designated by the
                Participant to receive the Participant's Plan benefits in the
                event of the Participant's death. If the Participant does not
                designate a Beneficiary, or if the Participant's designated
                Beneficiary predeceases the Participant, the Participant's
                estate shall be the Beneficiary under the Plan.

        2.6.    "BOARD" means the Board of Directors of the Company.

        2.7.    "BONUS" means any incentive compensation awarded to a
                Participant for a given year under the Woodward Governor Company
                Annual Incentive Compensation Plan, the Woodward Governor
                Company Long-Term Incentive Compensation Plan, the Woodward
                Governor Company Retention Incentive Agreement for FST
                Executives, and/or any other bonus or incentive compensation
                plan designated by the Administrator from time to time for
                inclusion within this definition for deferral purposes.

        2.8.    "CHANGE IN CONTROL" shall be deemed to have occurred if:

                (a)     any "person" (as defined in Section 13(d) and 14(d) of
                        the Exchange Act) (excluding for this purpose the
                        Company or any subsidiary of the Company, or any
                        employee benefit plan of the Company or any subsidiary
                        of the Company, or any person or entity organized,
                        appointed or established by the Company for or pursuant
                        to the terms of such plan which acquires beneficial
                        ownership of voting securities of the Company)

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                        is or becomes the "beneficial owner" (as defined in Rule
                        13d-3 under the Exchange Act) directly or indirectly of
                        securities of the Company representing fifteen percent
                        (15%) or more of the combined voting power of the
                        Company's then outstanding securities; provided,
                        however, that no Change in Control shall be deemed to
                        have occurred:

                        (i)     as the result of an acquisition of securities of
                                the Company by the Company which, by reducing
                                the number of voting securities outstanding,
                                increases the direct or indirect beneficial
                                ownership interest of any person to fifteen
                                percent (15%) or more of the combined voting
                                power of the Company's then outstanding
                                securities, but any subsequent increase in the
                                direct or indirect beneficial ownership interest
                                of such a person in the Company shall be deemed
                                a Change in Control; or

                        (ii)    as a result of the acquisition directly from the
                                Company of securities of the Company
                                representing less than fifty percent (50%) of
                                the voting power of the Company; or

                        (iii)   if the Board determines in good faith that a
                                person who has become the beneficial owner
                                directly or indirectly of securities of the
                                Company representing fifteen percent (15%) or
                                more of the combined voting power of the
                                Company's then outstanding securities has
                                inadvertently reached that level of ownership
                                interest, and if such person divests as promptly
                                as practicable a sufficient amount of securities
                                of the Company so that the person no longer has
                                a direct or indirect beneficial ownership
                                interest in fifteen percent (15%) or more of the
                                combined voting power of the Company's then
                                outstanding securities; or

                (b)     during any period of two (2) consecutive years (not
                        including any period prior to the original effective
                        date (as set forth in Section 1.2 above) of the Plan),
                        individuals who at the beginning of such two-year period
                        constitute the Board and any new director or directors
                        (except for any director designated by a person who has
                        entered into an agreement with the Company to effect a
                        transaction described in paragraph (a) above or
                        paragraph (c) below) whose election by the Board or
                        nomination for election by the Company's shareholders
                        was approved by a vote of at least two-thirds of the
                        directors then still in office who either were directors
                        at the beginning of the period or whose election or
                        nomination for election was previously so approved,
                        cease for any reason to constitute at least a majority
                        of the Board (such individuals and any such new
                        directors being referred to as the "Incumbent Board");
                        or

                (c)     approval by the shareholders of the company of a
                        complete liquidation or dissolution of the Company; or

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                (d)     consummation of:

                        (i)     an agreement for the sale or disposition of the
                                Company or all or substantially all of the
                                Company's assets,

                        (ii)    a plan of merger or consolidation of the Company
                                with any other corporation, or

                        (iii)   a similar transaction or series of transactions
                                involving the Company (any transaction described
                                in subparagraphs (i) and (ii) of this paragraph
                                (d) being referred to as a "Business
                                Combination"), in each case unless after such a
                                Business Combination:

                                (a)     the shareholders of the Company
                                        immediately prior to the Business
                                        Combination continue to own, directly or
                                        indirectly, more than fifty-one percent
                                        (51%) of the combined voting power of
                                        the then outstanding voting securities
                                        entitled to vote generally in the
                                        election of directors of the new (or
                                        continued) entity (including, but not by
                                        way of limitation, an entity which as a
                                        result of such transaction owns the
                                        Company or all or substantially all of
                                        the Company's former assets either
                                        directly or through one or more
                                        subsidiaries) immediately after such
                                        Business Combination, in substantially
                                        the same proportion as their ownership
                                        in the Company immediately prior to such
                                        Business Combination, and

                                (b)     at least a majority of the members of
                                        the board of directors of the entity
                                        resulting from such Business Combination
                                        were members of the Incumbent Board at
                                        the time of the execution of the initial
                                        agreement, or of the action of the
                                        Board, providing for such Business
                                        Combination.

        2.9.    "CODE" means the Internal Revenue Code of 1986, as amended.

        2.10.   "COMPANY" means Woodward Governor Company and any successor
                thereto.

        2.11.   "DEFERRAL CONTRIBUTION AMOUNTS" means the amounts of Base Salary
                and Bonus deferred by a Participant, if any, and credited to his
                or her Account in accordance with Article IV but such amounts
                specifically and expressly do not include any Prior Account
                Balance of such Participant.

        2.12.   "DEFERRAL ELECTION" means the written election made by an
                Eligible Member to defer such Eligible Member's Base Salary
                and/or Bonus for any given year in accordance with Article IV.

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        2.13.   "DISABILITY" means Disability as defined in the Woodward
                Governor Company Long-Term Disability Plan.

        2.14.   "DISTRIBUTION ELECTION" means the written election made by a
                Participant for a Plan Year regarding the timing and form of
                payment of his or her Deferral Contribution Amounts under
                Article IV or Supplemental Benefit Amounts under Article V with
                respect to such Plan Year.

        2.15.   "EARLY RETIREMENT DATE" means the date on which any Plan
                Participant retires from active employment with the Company or
                any Affiliate on or after he has attained age 55 but before he
                has attained age 65.

        2.16.   "ELECTION PERIOD" means the period specified by the
                Administrator during which a Deferral Election may be made with
                respect to a Participant's Base Salary and/or Bonus payable for
                a Plan Year, or a Distribution Election may be made with respect
                to payment of Deferred Compensation Amounts or Supplemental
                Benefit Amounts credited for such Plan Year.

        2.17.   "ELIGIBLE MEMBER" means a member of the Company or an Affiliate
                who has been selected by the Administrator to participate in the
                Plan in accordance with Article III.

        2.18.   "EXCHANGE ACT" means the Securities and Exchange Act of 1934.

        2.19.   "FICA" means the employment tax imposed on a member's income
                under the Federal Insurance Contributions Act (Chapter 21 of the
                Code) which is comprised of Old-Age, Survivors and Disability
                Insurance and Hospital Insurance

        2.20.   "INVESTMENT FUND OR FUNDS" means the investment funds designated
                by the Administrator as the basis for determining the
                hypothetical investment return to be credited in accordance with
                Article VI to Participants' Accounts. As of the effective date,
                the Investment Funds shall mirror the investment funds available
                under the RSP. The Administrator, in its sole discretion, may
                change the Investment Funds at such times as it deems
                appropriate. Any Investment Fund alternatives that are different
                that those offered under the RSP shall be described in an
                Appendix to the Plan.

        2.21.   "NORMAL RETIREMENT DATE" means the date on which any Plan
                Participant retires from active employment with the Company or
                any Affiliate on or after he has attained age 65.

        2.22.   "PARTICIPANT" means an Eligible Member who has:

                (a)     been notified by the Administrator of his eligibility to
                        participate in the Plan, and

                (b)     either:

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                        (i)     completed and submitted a Deferral Election in
                                accordance with Section 4.2, or

                        (ii)    had credited to his Account, by the Company,
                                Supplemental Benefit Amounts in accordance with
                                Article V, or

                        (iii)   had an account balance under the prior DC Plan
                                No. 1 and/or the prior DC Plan No. 2 on the day
                                immediately preceding the effective date of this
                                Plan.

        2.23.   "PLAN" means the Woodward Governor Company Executive Benefits
                Plan, as amended from time to time.

        2.24.   "PLAN YEAR" means the 12 consecutive month period beginning each
                January 1.

        2.25.   "PRIOR ACCOUNT BALANCE" means an Eligible Member's account
                balance(s), if any, under the prior DC Plan No. 1 and/or prior
                DC Plan No. 2 which were transferred to this Plan by the Company
                and credited to his Account pursuant to Section 3.1.

        2.26.   "RETIREMENT" means termination of employment by a Participant by
                reason of retiring from active employment with the Company or
                any Affiliate on his Early Retirement Date or Normal Retirement
                Date.

        2.27.   "SUPPLEMENTAL BENEFIT AMOUNT" means the amount computed on
                behalf of the Participant, if any, and credited to his or her
                Account in accordance with Article V.

        2.28.   "VALUATION DATE" means a date on which the Investment Funds are
                valued and the Participant's Account is adjusted for any
                resulting gains or losses. The Administrator shall determine the
                Valuation Date and such date shall be at least once every
                calendar year.

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III.    PARTICIPATION.

        3.1.    PARTICIPATION. The Administrator shall select those members
                eligible to participate in the Plan. In selecting Eligible
                Members, the Administrator shall take into consideration such
                factors as it deems relevant in connection with accomplishing
                the purposes of the Plan. An Eligible Member shall become a
                Participant in the Plan when (A) he is notified in writing by
                the Administrator that he is eligible to participate in the
                Plan, and (B) he has either (1) completed and submitted a
                Deferral Election to the Administrator in accordance with
                Article IV, or (2) had credited to his Account, by the Company,
                Supplemental Benefit Amounts in accordance with Article V, or
                (3) had credited to his Account, by the Company, his account
                balance, if any, under the prior DC Plan No. 1 and/or the prior
                DC Plan No. 2 on the day immediately preceding the original
                effective date of this Plan.

        3.2.    ERISA EXEMPTION. It is the intent of the Company that the Plan
                be exempt from Parts 2, 3 and 4 of Subtitle B of Title I of the
                Employee Retirement Income Security Act of 1974, as amended
                ("ERISA"), as an unfunded plan that is maintained by the Company
                primarily for the purpose of providing deferred compensation for
                a select group of management of highly compensated employees
                (the "ERISA Exemption"). Notwithstanding anything to the
                contrary in Section 3.1 or in any other provision of the Plan,
                the Administrator may in its sole discretion exclude any one or
                more members from eligibility to participate or from
                participation in the Plan, may exclude any Participant from
                continued participation in the Plan, and may take any further
                action (including the immediate payment of the Participant's
                entire interest under the Plan in a lump-sum) it considers
                necessary or appropriate if the Administrator reasonably
                determines in good faith that such exclusion or further action
                is necessary in order for the Plan to qualify for, or to
                continue to qualify for, the ERISA Exemption.

IV.     DEFERRAL CONTRIBUTION AMOUNTS.

        4.1.    PERMISSIBLE DEFERRALS UNDER THE PLAN. An Eligible Member may
                elect to defer:

                (a)     DEFERRAL OF BASE SALARY: up to 50% of his or her Base
                        Salary for a Plan Year, in increments of 1%, provided,
                        however, that any election to defer over 30% of Base
                        Salary must be approved in advance by the Administrator,
                        and

                (b)     DEFERRAL OF BONUS: up to 100% of his or her Bonus for a
                        Plan Year, in increments of 25%,

                by filing a Deferral Election in accordance with Section 4.2
                below.

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        4.2.    DEFERRAL ELECTIONS. A Participant's Deferral Election shall be
                in writing, and shall be filed with the Administrator at such
                time and in such manner as the Administrator shall provide,
                subject to the following:

                (a)     A Deferral Election pertaining to Base Salary and/or
                        Bonus shall be made during the Election Period
                        established by the Administrator which shall end no
                        later than December 31 preceding the first day of the
                        Plan Year in which such Base Salary and/or Bonus would
                        otherwise be payable.

                (b)     At the discretion of the Administrator, a Deferral
                        Election may be made by

                        (i)     newly-hired Eligible Members for the Plan Year
                                in which they commence employment,

                        (ii)    a member who becomes an Eligible Member after
                                the beginning of a Plan Year for the Plan Year
                                in which they become an Eligible Member.

                        Notwithstanding the preceding sentence, such Deferral
                        Elections must be made within thirty (30) days of their
                        date of hire or the date the member becomes an Eligible
                        Member, whichever applies. However, such Deferral
                        Elections shall be prospective and shall apply only to
                        Base Salary and/or Bonus that would otherwise be paid to
                        the Eligible Member after the Deferral Election is made.

                (c)     Deferral Elections shall be expressed as a percentage of
                        Base Salary or Bonus, within the limits provided under
                        the Plan.

                Once made, a Deferral Election for:

                        (A)     Base Salary shall remain in effect for all
                                subsequent Plan Years unless changed or revoked
                                by the Participant in accordance with rules
                                established by the Administrator, and

                        (B)     Bonus shall remain in effect only for the Plan
                                Year for which such Bonus Deferral Election was
                                made.

                Any such modification or revocation with respect to Base Salary
                shall be effective for the Plan Year following the Plan Year in
                which it is made. Notwithstanding anything to the contrary, any
                revocation for Base Salary and/or Bonus shall become effective
                as soon as practicable in the event it is made because of the
                Participant's Disability or if the Administrator, in its sole
                discretion, determines that the Participant has suffered a
                severe financial hardship or a bona fide administrative mistake
                was made. If a Deferral Election is revoked in accordance with
                any of the foregoing, the Participant may not make a new
                Deferral Election until the Election Period established by the
                Administrator for making deferrals for the next Plan Year.

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                (d)     At the time a Deferral Election is made with respect to
                        Base Salary or Bonus for a Plan Year, the Participant
                        may also make a Distribution Election with respect to
                        such Plan Year deferrals in accordance with Section 7.1.

        4.3.    CREDITING OF DEFERRAL ELECTIONS. The amount of Base Salary and
                Bonus that a Participant elects to defer under the Plan shall be
                credited by the Company to the Participant's Account as Deferral
                Contribution Amounts as of the date such Base Salary or such
                Bonus would have been paid to the Participant absent the
                Deferral Election.

        4.4.    VESTING. A Participant's Deferral Contribution Amounts for each
                Plan Year shall be fully vested at the time credited to such
                Participant's Account.

        4.5.    DEFERRED CONTRIBUTION AMOUNTS SUBJECT TO FICA AT TIME OF
                DEFERRAL. A Participant's Deferred Contribution Amounts are
                subject to FICA at the time the amounts are contributed to the
                Plan for deferral. The gross amount of the Participant's Base
                Salary deferral and Bonus deferral will be contributed to the
                Participant's Account and the corresponding FICA tax due will be
                deducted from that portion of the Participant's Base Salary or
                Bonus not deferred, as the case may be. Notwithstanding the
                foregoing, if a Participant has elected to defer a percentage of
                his or her Bonus such that contribution of the gross amount of
                the Bonus deferred would leave insufficient funds to remit the
                applicable FICA tax to the government, then the applicable Bonus
                amount contributed to the Participant's Account shall be made
                net of the smallest amount of FICA tax needed to satisfy such
                liability which cannot be covered from the portion of Bonus not
                deferred.

V.      SUPPLEMENTAL BENEFIT AMOUNT.

        5.1.    COMPUTATION OF SUPPLEMENTAL BENEFIT AMOUNT. An Eligible Member
                designated by the Administrator for participation under the Plan
                shall be entitled to a Supplemental Benefit Amount for each Plan
                Year that he is an Eligible Member equal to:

                (a)     the excess, if any, of the benefit the Participant
                        otherwise would have been entitled to have credited to a
                        separate account for his benefit under the RSP for a
                        given year if such benefit was calculated without regard
                        to the following:

                              (A)  Code Section 415,

                              (B)  Code Section 401(a)(17),

                              (C)  Code Section 401(k)(3),

                              (D)  Code Section 401(m)(2),

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                              (E)  Code Section 402(g), and

                              (F)  any Deferral Election made by the Participant
                                   for such given year under Article IV of this
                                   Plan, OVER

                (b)     the accrued benefit which the Participant is entitled to
                        have credited to a separate account for his benefit for
                        such given year under the RSP.

        5.2.    VESTING. A Participant's Supplemental Benefit Amounts calculated
                by the Company for each Plan Year shall be fully vested at the
                time credited to such Participant's Account.

        5.3.    CREDITING OF SUPPLEMENTAL BENEFIT AMOUNT. The Supplemental
                Benefit Amounts computed in Section 5.1 above for each Plan Year
                shall be credited by the Company to the Participant's Account as
                soon as reasonably practicable.

        5.4.    DISTRIBUTION ELECTIONS. During the Election Period for each Plan
                Year, a Participant may also make a Distribution Election with
                respect to the distribution under Section 7.1 of any
                Supplemental Benefit Amount to be credited to his or her Account
                for such Plan Year.

VI.     ACCOUNTS AND INVESTMENTS.

        6.1.    VALUATION OF ACCOUNTS. The Administrator shall establish an
                Account for each Participant who:

                (a)     has filed a Deferral Election to defer Base Salary
                        and/or Bonus, or

                (b)     has been credited with a Supplemental Benefit Amount, or

                (c)     has a Prior Account Balance on the effective date of
                        this Plan.

                Such Account shall be credited with a Participant's Deferral
                Contribution Amounts and Supplemental Benefit Amounts as set
                forth in Sections 4.3 and 5.3, respectively, and with the
                Participant's Prior Account Balance, if any. As of each
                Valuation Date, the Participant's Account shall be adjusted
                upward or downward to reflect:

                (i)     the investment return to be credited as of such
                        Valuation Date pursuant to Section 6.3 below,

                (ii)    the amount of distributions, if any, to be debited as of
                        that Valuation Date under Article VII, and

                (iii)   the amount of forfeitures, if any, to be debited under
                        Section 7.4(a).

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        6.2.    HYPOTHETICAL INVESTMENT FUNDS. Each Participant generally may
                direct the manner in which his or her Account shall be deemed
                invested in and among the Investment Funds; provided, however,
                that each investment election made by a Participant shall,
                notwithstanding anything to the contrary in the Plan, be
                strictly subject to the consent of the Administrator which, in
                its sole discretion, may elect to honor the Participant's
                request or have the Account deemed invested in another manner.
                Such deemed investment election shall be made in accordance with
                such procedures as the Administrator shall establish and any
                such election shall be made in whole percentages. The investment
                authority shall remain at all times with the Administrator. The
                selection of Investment Funds by a Participant shall be for the
                sole purpose of determining the rate of return to be credited to
                his or her Account and shall not be treated or interpreted in
                any manner whatsoever as a requirement or direction to actually
                invest assets in any Investment Fund or any other investment
                media.

                A Participant may make an investment election for the Investment
                Fund based on Woodward Governor Company Common Stock only if
                such election is approved in advance by the Board.
                Notwithstanding any provision of the Plan to the contrary, if a
                Participant is granted permission to elect such Investment Fund,
                the Participant may only revoke such Investment Fund election
                with the prior approval of the Board. Any such revocation shall
                only be effective with respect to future deferrals and credits.
                Any portion of the Participant's Account deemed invested in the
                Company's Common Stock shall continue to be deemed to be
                invested in Common Stock and may not be transferred to any other
                hypothetical Investment Fund. The applicable value of the common
                stock as of any Valuation Date shall be equal to the closing
                price of such common stock on NASDAQ quoted by the WALL STREET
                JOURNAL for the applicable Valuation Date.

        6.3.    CREDITING OF INVESTMENT RETURN. Each Participant's Account shall
                be credited on each Valuation Date with his or her allocable
                share of investment gains or losses of each Investment Fund in
                which his or her Account is hypothetically invested. The
                Administrator shall adopt a protocol for allocating the deemed
                investment gains and losses similar to that used in the RSP.
                Notwithstanding anything to the contrary, if a Participant
                elects to invest in the hypothetical Investment Fund for
                Woodward Governor Company Common Stock, such Participant's
                Account shall also be credited with any deemed dividends paid
                during the period beginning with the immediately preceding
                Valuation Date and ending with the current Valuation Date.

        6.4.    CHANGING INVESTMENT FUND OPTIONS. Subject to the provisions of
                this Article VI, a Participant may, on a daily basis, make a new
                election with respect to the hypothetical Investments Funds in
                which his or her Account shall be deemed invested in the future.
                Any such election shall be made in the form specified by the
                Administrator.

        6.5.    INVESTMENT ALTERNATIVES AFTER DEATH. For periods after the
                Valuation Date coincident with or following a Participant's
                death and pursuant to procedures

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                established by the Administrator, the Participant's Account
                balance pertaining to Deferral Contribution Amounts,
                Supplemental Benefit Amounts, if any, and/or Prior Account
                Balance, if any, shall be reallocated and reinvested among the
                Investment Funds in accordance with the Beneficiary's
                hypothetical investment direction.

VII.    PAYMENT OF BENEFITS.

        7.1.    DISTRIBUTION AT SPECIFIC FUTURE DATE. During the Election Period
                specified by the Administrator for a Plan Year, an Eligible
                Member may elect one or more future Valuation Dates as of which
                all or a portion of his or her Deferral Contribution Amounts and
                any Supplemental Benefit Amounts for such Plan Year, and
                earnings thereon, shall be distributed. Any distribution as of a
                specific future date made to an Eligible Member pursuant to such
                election shall be paid in a single lump-sum payment. Any such
                future date shall be a Valuation Date in a specific future year
                which is at least five Plan Years after the Plan Year for which
                the initial Deferral Contribution Amounts or Supplemental
                Benefit Amounts are credited to such Participant's Account;
                provided, however, that only one distribution date per Plan Year
                may be elected under this Section 7.1; provided, further that,
                if the Participant elects a distribution at one or more specific
                future dates and has a termination of employment prior to any
                such date, distribution shall commence pursuant to Sections 7.2,
                7.3, 8.1 or 8.2, as applicable. A distribution election under
                this Section 7.1 may be revoked or extended to a Valuation Date
                in a future Plan Year by filing a one-time revocation or
                extension election with the Administrator at least 12 months
                prior to the first day of the Plan Year in which such
                distribution was scheduled to take place. Notwithstanding the
                foregoing, any amounts distributable under this Section 7.1
                shall be paid as soon as practicable following such relevant
                Valuation Date.

        7.2.    DISTRIBUTION UPON RETIREMENT OR DISABILITY. If a Participant
                terminates employment with the Company and/or Affiliates by
                reason of Retirement or Disability, distribution of the
                Participant's Account shall be made by or commence on the
                Valuation Date coincident with or next following such
                Participant's termination of employment. Distribution under this
                Section 7.2 shall be made:

                (a)     in a lump sum, or

                (b)     in substantially equal annual, quarterly or monthly
                        installments for a period up to but not exceeding 10
                        years

                as elected by the Participant on his or her Distribution
                Election. A Participant may revoke or change his or her
                Distribution Election under this Section 7.2 by filing a new
                Distribution Election with the Administrator; provided, however,
                that any Distribution Election that has not been on file with
                the Administrator at least 12 months prior to the first day of
                the Plan Year in which the Participant's termination of
                employment occurs shall be void and disregarded. A Participant

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                cannot alter or change his Distribution Election once he has
                begun to receive payments under the Plan. Notwithstanding the
                foregoing, a Participant (or his legal representative) whose
                termination of employment occurs by reason of Disability may
                request that the Administrator distribute the Participant's
                Account in another payment form following such termination of
                employment for Disability or defer distribution of the
                Participant's Account until such Participant is no longer
                eligible for coverage under the Woodward Governor Company
                Long-Term Disability Plan, in which case the Administrator, in
                its sole discretion, shall determine whether to make payment in
                another form or defer such distributions after taking into
                consideration all factors which it deems relevant. If the
                Participant does not have a valid Distribution Election on file
                with the Administrator at the time of Retirement or Disability,
                the Participant's Account shall be paid in a single sum under
                paragraph (a) above.

        7.3.    DISTRIBUTION ON OTHER TERMINATION OF EMPLOYMENT. If a
                Participant's employment with the Company or Affiliates
                terminates for any reason other than Retirement, Disability or
                death, the Participant's Account shall be paid in a lump sum
                payment as of the Valuation Date coincident with or next
                following such termination of employment.

        7.4.    UNSCHEDULED WITHDRAWAL. A Participant may request a withdrawal
                of all or a portion of his or her Deferral Contribution Amounts,
                Supplemental Benefit Amounts, and earnings thereon, by filing a
                Distribution Election with the Administrator specifying the
                amount to be withdrawn. Payment of such amount, adjusted by the
                amount forfeited as set forth in paragraph (a) below, shall be
                made as of the first Valuation Date administratively practicable
                after such request is received, and shall be subject to the
                following:

                (a)     An amount equal to 10% of the withdrawal requested shall
                        be debited to the Participant's Account and permanently
                        forfeited.

                (b)     Any Deferral Election in effect at the time of such
                        withdrawal shall be void for periods after such
                        withdrawal.

                (c)     The Participant shall not be eligible to file a new
                        Deferral Election until the election period for the Plan
                        Year commencing at least 12 months after such
                        withdrawal.

        7.5.    UNFORESEEABLE EMERGENCY. Prior to the date otherwise scheduled
                for payment under the Plan, upon showing an unforeseeable
                emergency, a Participant may request that the Administrator
                accelerate payment of all or a portion of his or her Deferral
                Contribution Amounts, Supplemental Benefit Amounts, and earnings
                thereon, in an amount not exceeding the amount necessary to meet
                the unforeseeable emergency. For purposes of the Plan, an
                unforeseeable emergency means an unanticipated emergency that is
                caused by an event beyond the control of the Participant and
                that would result in severe financial or medical hardship to the
                Participant if early withdrawal were not permitted. Severe
                financial or

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                medical hardship shall be deemed to exist in the event of the
                Participant's long and serious illness, impending bankruptcy or
                other similar extraordinary circumstances. The determination of
                an unforeseeable emergency shall be made by the Administrator in
                its sole discretion, based on such information as the
                Administrator shall deem to be necessary and relevant and such
                decision shall be final and binding on all parties.

        7.6.    TIME AND FORM OF ELECTIONS. All Distribution Elections under
                this Article VII shall be made at the time and in the form
                established by the Administrator and shall be subject to such
                other rules and limitations that the Administrator, in its sole
                discretion, may establish.

        7.7.    FORM OF PAYMENT AND WITHHOLDING. All payments under the Plan
                shall be made in cash and are subject to the withholding of all
                applicable federal, state and local and foreign governmental
                taxes; provided, however, any payment under the Plan that is
                attributable to the portion of a Participant's Account deemed
                invested in Company common stock shall be made in whole shares
                of Company common stock, with fractional shares paid in cash.

VIII.   DEATH BENEFITS.

        8.1.    DEATH PRIOR TO COMMENCEMENT OF BENEFITS. If a Participant dies
                prior to commencement of payment of his or her Account, the
                Participant's Beneficiary shall receive a survivor benefit in an
                amount equal to the Participant's Account balance to be paid in
                a single lump sum as soon as practicable following the
                Participant's death.

        8.2.    DEATH AFTER COMMENCEMENT OF BENEFITS. If a Participant
                terminates employment due to Retirement or Disability, and dies
                prior to the time his or her Account balance has been fully
                distributed, the Participant's Beneficiary shall receive the
                remaining portion of the Participant's Account at the
                regularly-scheduled date of payment for any remaining
                installment payments of the Participant's Account.

        8.3.    ADMINISTRATOR DISCRETION REGARDING FORM. Notwithstanding the
                foregoing provisions of this Article VIII, a Beneficiary may
                request that the Administrator approve an alternate form of
                payment of survivor benefits under this Article VIII which
                request may be granted in the sole discretion of the
                Administrator.

IX.     ADMINISTRATION.

        9.1.    AUTHORITY OF ADMINISTRATOR. The Administrator shall have full
                power and authority to carry out the terms of the Plan. The
                Administrator may establish such rules and regulations as it may
                consider necessary or desirable for the effective and efficient
                administration of the Plan. The Administrator's interpretation,
                construction and administration of the Plan, including any
                adjustment of the amount or recipient of the payments to be
                made, shall be binding and conclusive

<Page>

                on all persons for all purposes. Neither the Company, including
                its officers, members or directors, nor the Administrator or the
                Board or any member thereof, shall be liable to any person for
                any action taken or omitted in connection with the
                interpretation, construction and administration of the Plan.

        9.2.    PARTICIPANT'S DUTY TO FURNISH INFORMATION. Each Participant
                shall furnish to the Administrator such information as it may
                from time to time request for the purpose of the proper
                administration of this Plan.

        9.3.    INTERESTED MEMBER OF ADMINISTRATOR. If a member of the
                Administrator is also a Participant in the Plan, he or she may
                not decide or determine any matter or question concerning his or
                her benefits unless such decision or determination could be made
                by him or her under the Plan if he or she were not a member of
                the Administrator.

        9.4.    INDEMNIFICATION. No person (including any present or former
                member of the Administrator, and any present or former officer
                or member of the Company or any Affiliate) shall be personally
                liable for any act done or omitted to be done in good faith in
                the administration of the Plan. Each present or former officer
                or member of the Company or any Affiliate to whom the
                Administrator has delegated any portion of its responsibilities
                under the Plan and each present or former member of the
                Administrator shall be indemnified and saved harmless by the
                Company (to the extent not indemnified or saved harmless under
                any liability insurance or other indemnification arrangement
                with respect to the Plan) from and against any an all claims of
                liability to which they are subjected by reason of any act done
                or omitted to be done in good faith in connection with the
                administration of the Plan, including all expenses reasonably
                incurred in their defense if the Company fails to provide such
                defense. No member of the Administrator shall be liable for any
                act or omission of any other member of the Administrator, nor
                for any act or omission upon his own part, excepting his own
                willful misconduct or gross neglect.

        9.5.    CLAIMS PROCEDURE. If a Participant or Beneficiary ("Claimant")
                is denied all or a portion of an expected benefit under this
                Plan for any reason, he or she may file a claim with the
                Administrator. The Administrator shall notify the Claimant
                within 90 days of allowance or denial of the claim, unless the
                Claimant receives written notice from the Administrator prior to
                the end of the 90-day period stating that special circumstances
                require an extension (of up to 90 additional days) of the time
                for decision. The notice of the decision shall be in writing,
                sent by mail to Claimant's last known address, and if a denial
                of the claim, shall contain the following information: (a) the
                specific reasons for the denial; (b) specific reference to
                pertinent provisions of the Plan on which the denial is based;
                and (c) if applicable, a description of any additional
                information or material necessary to perfect the claim, an
                explanation of why such information or material is necessary,
                and an explanation of the claims review procedure. A Claimant is
                entitled to request a review of any denial of his or her claim
                by the Board. The request for review must be submitted within 60
                days of mailing of notice of the

<Page>

                denial. Absent a request for review within the 60-day period,
                the claim shall be deemed to be conclusively denied. The
                Claimant or his or her representatives shall be entitled to
                review all pertinent documents, and to submit issues and
                comments orally and in writing. The Board shall render a review
                decision in writing within 60 days after receipt of a request
                for a review, provided that, in special circumstances the Board
                may extend the time for decision by not more than 60 days upon
                written notice to the Claimant. The Claimant shall receive
                written notice of the Board's review decision, together with
                specific reasons for the decision and reference to the pertinent
                provisions of the Plan.

X.      AMENDMENT AND TERMINATION.

        The Board may amend or terminate the Plan at any time; provided,
        however, that no such amendment or termination shall have a material
        adverse effect on any Participant's rights under the Plan accrued as of
        the date of such amendment or termination without such Participant's
        written consent. Upon termination of the Plan, the Board may cause a
        lump-sum payment of all benefits for all Participants at substantially
        the same time.

XI.     MISCELLANEOUS.

        11.1.   NO IMPLIED RIGHTS; RIGHTS ON TERMINATION OF SERVICE. Neither the
                establishment of the Plan nor any amendment thereof shall be
                construed as giving any Participant, Beneficiary or any other
                person, individually or as a member of a group, any legal or
                equitable right unless such right shall be specifically provided
                for in the Plan or conferred by specific action of the Board or
                the Administrator in accordance with the terms and provisions of
                the Plan. Except as expressly provided in this Plan, neither the
                Company nor any of its Affiliates shall be required or be liable
                to make any payment under the Plan.

        11.2.   NO EMPLOYMENT RIGHTS. Nothing herein shall constitute a contract
                of employment or of continuing service or in any manner obligate
                the Company or any Affiliate to continue the services of any
                Participant, or obligate any Participant to continue in the
                service of the Company or Affiliates, or as a limitation of the
                right of the Company or Affiliates to discharge any of their
                members, with or without cause.

        11.3.   NATURE OF THE PLAN.

                (a)     UNFUNDED PLAN. Nothing herein contained shall require or
                        be deemed to require the Company to segregate, earmark
                        or otherwise set aside any funds or other assets to
                        provide for any payments made hereunder. Benefits
                        hereunder shall be paid from assets which shall
                        continue, for all purposes, to be part of the general,
                        unrestricted assets of the Company and its Affiliates.
                        The obligations of the Company hereunder shall be an
                        unfunded and unsecured promise to pay money in the
                        future. However, the Company may establish one or more
                        trusts to assist in meeting its obligations under the
                        Plan, the assets of which shall be subject to the

<Page>

                        claims of the Company's general creditors. No current or
                        former Participant, Beneficiary or other person,
                        individually or as a member of a group, shall have any
                        right, title or interest in any account, fund, grantor
                        trust, or any asset that may be acquired by the Company
                        in respect of its obligations under the Plan (other than
                        as a general creditor of the Company with an unsecured
                        claim against its general assets).

                (b)     EXCEPTION FOR CHANGE IN CONTROL. Notwithstanding the
                        provisions of paragraph (a) of this Section 11.3, the
                        Company shall create a rabbi trust to hold funds to be
                        used in payment of the obligations of the Company under
                        the Plan, which trust shall not be funded except as
                        provided in the following sentence. In the event of a
                        Change in Control (or prior thereto in the sole
                        discretion of the Company), the Company shall fund such
                        trust in an amount equal to not less than the total
                        value of the Participants' Accounts under the Plan as of
                        the Valuation Date immediately preceding the Change in
                        Control, provided that any funds contained therein shall
                        remain subject to the claims of the Company's general
                        creditors. In addition, upon a Change in Control, the
                        trust by its terms shall become irrevocable.

        11.4.   NONTRANSFERABILITY. Prior to payment thereof, no benefit under
                the Plan shall be assignable or subject to any manner of
                alienation, sale, transfer, claims of creditors, pledge,
                attachment or encumbrances of any kind, except pursuant to a
                domestic relations order awarding benefits to an "alternate
                payee" (within the meaning of Code Section 414(p)(8)) that the
                Administrator determines satisfies the criteria set forth in
                paragraphs (1), (2) and (3) of Code Section 414(p) (a "DRO").
                Notwithstanding any provision of the Plan to the contrary, the
                Plan benefits awarded to an alternate payee under a DRO shall be
                paid in a single lump sum to the alternate payee on the
                Valuation Date as soon as administratively practicable following
                the date the Administrator determines the order is a DRO, and
                such amounts, as adjusted for earnings, gains and losses, will
                be deducted from the Participant's Account as of such Valuation
                Date.

        11.5.   SUCCESSORS AND ASSIGNS. The rights, privileges, benefits and
                obligations under the Plan are intended to be, and shall be
                treated as legal obligations of and binding upon the Company,
                its successors and assigns, including successors by merger,
                consolidation, reorganization or otherwise.

        11.6.   PAYMENT WITH RESPECT TO INCAPACITATED PERSONS. Any amounts
                payable hereunder to any person who is a minor or under a legal
                disability, as determined under applicable state law, or who is
                unable to manage properly his or her financial affairs may be
                paid (a) to the legal representative of such person, (b) to
                anyone acting as the person's agent under a durable power of
                attorney, (c) to an adult relative or friend of the person or
                (d) to anyone with whom the person is residing. Any payment of a
                benefit made in accordance with the provisions of this section
                shall be a complete discharge of any liability for the making of
                such payment under the Plan. The Administrator's reliance on the
                written power of

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                attorney or other instrument of agency governing a relationship
                between the person entitled to benefit the person to whom the
                Administrator directs payment of the benefit shall be fully
                protected at least to the same extent as though the
                Administrator had dealt directly with the person entitled to the
                benefit as a fully competent person. In the absence of actual
                knowledge to the contrary, the Administrator may assume that the
                instrument of agency was validly executed, that the person was
                competent at the time of execution and that at the time of
                reliance, the agency had not been terminated or amended.

        11.7.   ARBITRATION. Any controversy or claim arising out of or relating
                to this Plan, or breach hereof, shall be settled by arbitration
                in the City of Chicago in accordance with the laws of the State
                of Illinois with an arbitrator appointed by the Company. The
                arbitration shall be conducted in accordance with the rules of
                the American Arbitration Association, except with respect to the
                selection of an arbitrator. The arbitrator's determination shall
                be final and binding upon all parties and judgment upon the
                award rendered by the arbitrator may be entered in any court
                having jurisdiction thereof.

        11.8.   GENDER AND NUMBER. Except when otherwise indicated by the
                context, words in the masculine gender shall include the
                feminine and neuter genders, the plural shall include the
                singular, and the singular shall include the plural.

        11.9.   HEADINGS. The headings of the various Articles and Sections in
                the Plan are solely for convenience and shall not be relied upon
                in construing any provisions hereof. Any reference to a Section
                shall refer to a Section of the Plan unless specified otherwise.

        11.10.  SEVERABILITY. Whenever possible, each provision of the Plan
                shall be interpreted in such manner as to be effective and valid
                under applicable law, but it any provision of the Plan is held
                to be invalid, illegal or unenforceable in any respect under any
                applicable law or rule in any jurisdiction, such invalidity,
                illegality or unenforceability shall not affect any other
                provision or any other jurisdiction, and the Plan shall be
                reformed, construed and enforced in such jurisdiction so as to
                best give effect to the intent of the Company under the Plan.

        11.11.  EFFECT ON OTHER EMPLOYEE BENEFIT PLANS. Any benefit paid or
                payable under this Plan shall not be included in a Participant's
                compensation for purposes of computing benefits under any
                employee benefit plan maintained or contributed by the Company
                or any Affiliate except as may otherwise be required under the
                specific terms of such employee benefit plan.

        11.12.  NON-U.S. PARTICIPANTS. With respect to any Affiliate which
                employs Participants who reside outside the United States, and
                notwithstanding anything herein to the contrary, the
                Administrator may, in its sole discretion, amend the terms of
                the Plan in order to conform such terms with the requirements of
                local law or to meet the objectives of the Plan, and may, where
                appropriate, establish one or more sub-plans to reflect such
                amended provisions.

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        11.13.  APPLICABLE LAW. This Plan is established under and will be
                construed according to the laws of the State of Illinois, to the
                extent not preempted by the laws of the United States.