Document:

Prepared and filed by St Ives Burrups

Exhibit 10.68

TB WOOD'S CORPORATION

GRANT OF PREMIUM PRICED NON-QUALIFIED STOCK OPTION
  

     1.      Grant of Option and Exercise Price.  Subject to the terms and conditions set forth herein and in the TB Wood's Corporation 1996 Stock-Based Incentive Compensation Plan (the "Plan"), TB Wood's Corporation (the "Company") hereby grants to ___________, (the "Optionee"), a stock option (the "Option") to purchase up to_______ shares of Common Stock of the Company, par value $.01 per share (the "Common Stock"), at an exercise price of $13.08 per share (the "Exercise Price").  The Option is a non-qualified stock option.

     2.      Vesting
      of Options.  One-third of the shares of Common Stock subject to the
      option shall vest on the first anniversary of the date of grant of the
      Option (the "Grant Date"), an additional one-third of the shares
      of Common Stock subject to the option shall vest on the second anniversary
      of the Grant Date, and the final one-third of the shares of Common Stock
      subject to the option shall vest on the third anniversary of the Grant
      Date.

     3.      Time of Exercise.  The Option may be exercised from time to time with respect to shares for which the Option has vested but no later than the tenth anniversary of the Grant Date. Upon the tenth anniversary of the Grant Date, the Optionee's right to exercise the Option shall terminate absolutely.

     4.      Payment for Shares of Common Stock.  Upon exercise of an Option and before delivery of the shares of Common Stock, full payment for shares of Common Stock purchased upon the exercise of the Option shall be made in cash or, subject to the approval of the Company committee administering the Plan (the "Committee"), in whole or in part in shares of Common Stock valued at the fair market value on the date of exercise.

     5.      Manner of Exercise.  The Option shall be exercised by giving written notice of exercise to the Company (Attn: Chief Financial Officer) at the Company's main office at 440 North Fifth Avenue, Chambersburg, Pennsylvania 17201-1778.  Such notice of exercise must include a statement of preference as to the manner in which payment to the Company shall be made.  Such notice shall be deemed to have been given when hand-delivered, telecopied or mailed, first-class postage prepaid, and shall be irrevocable once given.

     6.      Issuance of Certificates.  As promptly as is reasonably practicable after the exercise of the Option as determined by the Company, a certificate for the shares of Common Stock issuable on the exercise of the Option shall be delivered to Optionee or to his personal representative, heir or legatee.

     7.      Nontransferability of Option.  The Option may not be transferred or assigned by Optionee otherwise than by will or the laws of descent and distribution or be exercised other than by Optionee or, in the case of his death, by his personal representative, heir or legatee.

     8.      Taxes.  Optionee shall be responsible to make appropriate provision for all taxes required to be withheld in connection with any Option, the exercise thereof and the transfer of the shares of Common Stock.  Such responsibility shall extend to all applicable federal, state, local or foreign withholding taxes.  In the case of exercise of the Option, the Company shall, at the election of Optionee, have the right to retain the number of shares of Common Stock whose aggregate fair market value equals the amount to be withheld in satisfaction of the applicable withholding taxes.

     9.      Termination of Employment.  If the Optionee's employment by the Company (or a subsidiary thereof) is terminated for any reason, all unvested Options shall be forfeited and the Optionee shall have no further right to exercise such Options.  If the Optionee's employment by the Company (or a subsidiary thereof) is terminated by reason of disability or retirement, all unexercised, vested Options may be exercised pursuant to the terms of the Option for a period of three months from the date of such termination of employment or until the expiration of the term of the Option, whichever period is shorter; provided, however, that if the Optionee's employment is terminated by death, all
unexercised, vested Options may be exercised pursuant to the terms of the Option for a period of six months from the date of such termination of employment or until the expiration of the term of the Option, whichever period is shorter.  If the Optionee's employment by the Company (or a subsidiary thereof) is terminated for any reason other than death, disability or retirement, all unexercised, vested options shall terminate three months from the date of such termination of employment.

     10.      Rights Prior to Exercise.  Neither Optionee nor his personal representative, heir or legatee shall have any of the rights of a stockholder with respect to any Common Stock until the date of the issuance to him or her of a certificate for such Common Stock as provided herein.

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     11.      Amendments.  The Committee may from time to time amend the terms of this Option to the extent it deems appropriate to carry out the terms and provisions of the Plan.           

     12.      Interpretation.
    The Committee shall have sole power to resolve any dispute or disagreement
    arising out of this Agreement. The interpretation and construction of any
    provision of this Option or the Plan made by the Committee shall be final
    and conclusive and, insofar as possible, shall be consistent with the requirements
of a non-qualified stock option.

     13.      Option Not to Affect Employment.  The Option granted hereunder shall not confer upon Optionee any right to continue in the employment of the Company or any Subsidiary.

                                                                                               TB WOOD'S CORPORATION

                                                                                               By: /s/James R. Swenson

                                                                                               James R. Swenson, Interim CEO

Dated as of February 5, 2004

- 3 -Prepared and filed by St Ives Burrups

Exhibit 10.69

NINTH AMENDMENT TO LOAN DOCUMENTS

     This NINTH AMENDMENT TO LOAN DOCUMENTS ("Amendment") dated as of January 2, 2004, and having an effective date of December 31, 2003, is made by and among TB WOOD'S INCORPORATED, individually and as Agent under the Borrower Agency Agreement (the "Borrower Agent") and PNC BANK, NATIONAL ASSOCIATION, a national banking association, as Agent for the Banks under the Credit Agreement referred to herein (the "Agent") and PNC BANK, NATIONAL ASSOCIATION, WACHOVIA BANK (assuccessor to First Union National Bank)and NATIONAL CITY BANK OF PENNSYLVANIA as the Banks.

     Reference is made to the Revolving Credit Agreement dated October 10, 1996, by and among TB Wood's Incorporated, a Pennsylvania corporation, Plant Engineering Consultants, Inc., a Tennessee corporation ("Plant Engineering"), TB Wood's Enterprises, Inc., a Delaware corporation, TB Wood's North Carolina, Inc., a Delaware corporation, TB Wood's Foreign Sales Corporation, a Barbados corporation, TB Wood's Foreign Investment Company, a Delaware corporation, Industrial Blaju, S.A., de C.V. Mexico City, Mexico, a Mexican corporation (successor to TB Wood's Mexico, S.A. de C.V. f/k/a Grupo Blaju, S.A., de C.V.), TB Wood's Canada, Ltd., an Ontario corporation, Berges Electronic GmbH, Berges Electronic, S.r.l. (such
corporations being the "Borrowers"), and PNC Bank, National Association, as Agent and the Banks party thereto as amended on April 7, 1997, January 20, 1998, April 24, 1998, July 21, 1999, November 8, 1999, February 25, 2002 (with an effective date of December 28, 2001), April 30, 2002 and March 31, 2003 (with an effective date of March 28, 2003) (as so amended, the "Agreement") pursuant to which the Banks extended to the Borrowers a revolving line of credit in the amount of $46,000,000.  The obligations under the Agreement and the Loan Documents are evidenced by the Borrowers' Notes payable to the Banks.  (Capitalized terms used herein not otherwise defined shall have the meanings provided for in the Agreement.)

     Pursuant to this Amendment, certain financial covenants for the fourth quarter of 2003 and the Revolving Credit Interest Rate Options under the Revolving Credit Agreement shall be amended as set forth herein.

     NOW, THEREFORE, in consideration of the foregoing and for other consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

	     1.  
           Amendment
to Agreement.

		
     

	 	 	(a)      Section 4.1.1 of the Agreement is hereby amended and restated to read in its entirety as follows:

	 	 	 	 	 
	 	 	 	 	4.1.1      Revolving
    Credit Interest Rate Options.
	 	 	 	 	 
	 	 	 	 	The Borrowers shall have the right
    to select from the following Interest Rate Options applicable to the Loans:
	 	 	 	 	 
	 	 	 	 	(i)      Base Rate Option:  A fluctuating rate per annum (computed on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed) equal to the Base Rate, such interest rate to change automatically from time to time effective as of the effective date of each change in the Base Rate;

	 	 	 	 	 
	 	 	 	 	(ii)      Revolving Credit Euro-Rate Option:  A rate per annum (computed on the basis of a year of 360 days and actual days elapsed) equal to the Euro-Rate plus the rate per annum (the “Applicable Margin”) described below measured in respect of the Borrowers' Leverage Ratio as of the end of each fiscal quarter:
	 	 	 	 	 

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	 	 	 	 	 (a)  if the Borrowers' Leverage Ratio less than or equal to 1.5 to 1.0, then the Applicable Margin shall be 1.50%; and

	 	 	 	 	 
	 	 	 	 	(b)  if the Borrowers' Leverage Ratio is greater than 1.5 to 1.0 but less than or equal to 2.0 to 1.0, then the Applicable Margin shall be 1.75%; and

	 	 	 	 	 
	 	 	 	 	(c)  if the Borrowers' Leverage Ratio is greater than 2.0 to 1.0 but less than or equal to 2.5 to 1.0, then the Applicable Margin shall be 2.00%; and

	 	 	 	 	 
	 	 	 	 	(d)  if the Borrowers' Leverage Ratio is greater than 2.5 to 1.0, but less than 3.0 to 1.0 then the Applicable Margin shall be 2.25%; and

	 	 	 	 	 
	 	 	 	 	(e)  if the Borrowers' Leverage Ratio is greater than 3.0 to 1.0, but less than or equal to 3.25 to 1 then the Applicable Margin shall be 2.50%.

	 	 	 	 	 
	 	 	 	 	(f)  if the Borrower's Leverage Ratio is greater than 3.25 to 1 then the Applicable Margin shall be 2.75%

          Any changes in the Applicable Margin  pursuant to the provisions of this Section shall become effective from the fifth day after the Agent shall have received the Certificate delivered pursuant to Section 8.3.4 in respect of such fiscal quarter; provided, that, in the event that the Certificate delivered pursuant to Section 8.3.4 for any fiscal quarter is not timely delivered, then the Applicable Margin shall be the amount set forth in item (f) above commencing as of the date such Certificate was required to be delivered until the delivery of such Certificate.     

	 	 	(b)     Section
        8.2.18 [Maximum Leverage Ratio] of the Agreement is hereby amended and
    restated to read in its entirety as follows:
	 	 	 	 	 
	 	 	 	   8.2.18      Maximum Leverage Ratio.

	 	 	 	 	 
	 	 	 	 The Borrowers shall not permit at any time the Borrowers' Leverage Ratio to exceed 3.7 to 1.0 for the fiscal quarter ending on December 31, 2003 and 3.0 to 1.0 from and after December 31, 2003.
	 	 	 	 	 

	
           2.     Conditions
to Closing.

               (a)      This Amendment is effective upon the satisfaction of the following conditions:

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                          (i)      The execution and delivery by Borrowers and the Banks of this Amendment.

                          (ii)     The Borrowers shall pay all of the Agent's expenses incurred in connection with the preparation of this Amendment and the transactions contemplated by this Amendment, including without limitation, the reasonable fees and expenses of the Agent's counsel.

	
           3.     Miscellaneous.

		 
		        (a)     All
    of the terms, conditions, provisions and covenants in the Notes, the Agreement,
    the Loan Documents, and all other documents delivered to the Banks and the
    Agent in connection with any of the foregoing documents and obligations secured
    thereby shall remain unaltered and in full force and effect except as modified
    by this Amendment.

		 
		 
        (b)     The Borrowers hereby represent and warrant to the Banks and the Agent as of the date of this Amendment that, after giving effect to this Amendment: 

                             (i)      there exists no Event of Default or Potential Default under any of the Loan Documents and that after giving effect to this Amendment, the representations and warranties in Section 6 of the Agreement are true and correct in all respects on and as of the date hereof.

		
           (c)     This Amendment shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania.
  
		
		

		
		
		 
		
           (d)     Each and every one of the terms and provisions of this Amendment shall be binding upon and shall inure to the benefit of the Borrowers, the Banks and the Agent and their respective successors and assigns.
		 

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           (e)     This
  Amendment may be executed in one or more counterparts, each of which shall
  be deemed to be an original as against any party whose signature appears thereon,
  and all of which shall constitute but one and the same instrument. This Amendment
  supersedes all prior understandings and agreements, whether written or oral,
  between the parties hereto and thereto relating to the transactions provided
  for herein or therein, including any prior proposal or commitment letters.

		 
		
           (f)     The execution and delivery of this waiver shall not be construed to establish a course of conduct or imply that any other, future or further waivers, consents or forbearance shall be considered, provided or agreed to.

          .

Remainder of Page Intentionally Left Blank

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the day and year first above written.

	 	 	 	 	 	 	TB WOOD’S INCORPORATED, individually 

	 	 	 	 	 	 	and as Borrower Agent

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/Joseph C. Horvath

	 	 	 	 	 	 	Title: Vice President of Finance/CFO

		 	 	 	 	 	 
	 	 	 	 	 	 	PLANT ENGINEERING CONSULTANTS, INC.

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/Joseph C. Horvath

	 	 	 	 	 	 	Title: Treasurer

		 	 	 	 	 	 
	 	 	 	 	 	 	INDUSTRIAL BLAJU S.A., de C.V. MEXICO CITY, MEXICO

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/ Juan G. Kiewek

	 	 	 	 	 	 	Title: President

		 	 	 	 	 	 
	 	 	 	 	 	 	TB WOOD'S CANADA, LTD.

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/Michael H. Iversen

	 	 	 	 	 	 	Title: President

		 	 	 	 	 	 
	 	 	 	 	 	 	BERGES ELECTRONIC GMBH

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/Prepen H. Petersen

	 	 	 	 	 	 	Title: Director/General Manager

SIGNATURES TO NINTH AMENDMENT TO LOAN DOCUMENTS 

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SIGNATURES TO NINTH AMENDMENT TO LOAN DOCUMENTS

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	 	 	 	 	 	 	BERGES ELECTRONIC, S.r.l.

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/ Preben H. Petersen

	 	 	 	 	 	 	Title: Director/General Manager

		 	 	 	 	 	 
	 	 	 	 	 	 	TB WOOD'S NORTH CAROLINA, INC., 

	 	 	 	 	 	 	a Delaware corporation;

		 	 	 	 	 	 
	 	 	 	 	 	 	By: ____________________________________

	 	 	 	 	 	 	Title: ___________________________________

		 	 	 	 	 	 
	 	 	 	 	 	 	TB WOOD'S FOREIGN SALES CORPORATION, 

	 	 	 	 	 	 	a Barbados corporation;

		 	 	 	 	 	 
	 	 	 	 	 	 	By: ____________________________________     

	 	 	 	 	 	 	Title: ___________________________________

		 	 	 	 	 	 
	 	 	 	 	 	 	TB WOOD'S FOREIGN INVESTMENT COMPANY, 

	 	 	 	 	 	 	a Delaware corporation.

		 	 	 	 	 	 
	 	 	 	 	 	 	By: ____________________________________    

	 	 	 	 	 	 	Title: ___________________________________

		 	 	 	 	 	 
	 	 	 	 	 	 	TB WOOD'S ENTERPRISES, INC., 

	 	 	 	 	 	 	a Delaware corporation;

		 	 	 	 	 	 
	 	 	 	 	 	 	By: /s/Joseph C. Horvath

	 	 	 	 	 	 	Title: President

SIGNATURES TO NINTH AMENDMENT TO LOAN DOCUMENTS

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		 	 	 	 	 	PNC BANK, NATIONAL ASSOCIATION,
	 	 	 	 	 	 	individually and as Agent

		 	 	 	 	 	 
	 	 	 	 	 	 	/s/Frank M. Sajer     

	 	 	 	 	 	 	Frank M. Sajer

	 	 	 	 	 	 	Vice President

		 	 	 	 	 	 
	 	 	 	 	 	 	NATIONAL CITY BANK OF PENNSYLVANIA

		 	 	 	 	 	 
	 	 	 	 	 	 	//s//Susan Dimmick     

	 	 	 	 	 	 	Susan Dimmick

	 	 	 	 	 	 	Vice President

		 	 	 	 	 	 
	 	 	 	 	 	 	WACHOVIA BANK, successor to First Union National Bank

		 	 	 	 	 	 
	 	 	 	 	 	 	/s/Andrew Bowman     

	 	 	 	 	 	 	Andrew Bowman

	 	 	 	 	 	 	Vice President

ACCEPTED AND AGREED:

TB WOOD’S CORPORATION

By: /s/Joseph C. Horvath

       Joseph C. Horvath

Title: Chief Financial Officer

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