Document:

REGAL-BELOIT
CORPORATION 
2007 EQUITY INCENTIVE
PLAN 
STOCK OPTION AWARD 

[Name] 
[Address]  

You have been granted an option (the
“Option”) to purchase shares of common stock of Regal-Beloit Corporation (the
“Company”) under the Regal-Beloit Corporation 2007 Equity Incentive Plan (the
“Plan”) with the following terms and conditions: 

	Grant Date: 	  	
                         __________, 200__ 

	Type of
Option: 	  	                      [Nonqualified or Incentive Stock Option] 

	Number of
Option Shares: 	  	             __________________ 

	Exercise Price
per Share:  	  	           U.S. $_____________ 

	Vesting:  	  	________
percent (___%) of your Option will vest and become  exercisable on each
                                     of the first ______ anniversaries of the Grant Date. 

	 	
Upon
your  termination  of  employment  from,  or  cessation of services to, the
                                     Company  and  its  Affiliates,   the  unvested
  portion  of  your  Option  will                                      terminate. 

	Termination Date: 	  	
                   This Option expires at, and cannot be exercised  after, the close of
business at                                      the Company's headquarters on the
earlier to occur of: 

	 	o 	The
tenth (10th) anniversary of the Grant Date; or  

	 	o 	Thirty
(30) days after your  termination  of  employment or service for
                                              any other reason other than for Cause.  

	 	
If
the date this Option  terminates  as specified  above falls on a day on which
                                     the  stock  market  is not open  for  trading,  the
 termination  date  shall be                                      automatically
  extended  to  the  first  trading  day  following  the  original
                                     termination date. 

	 	
Your
entire  Option is  terminated  immediately  if the Company or an  Affiliate
                                     terminates  your  employment  for  Cause,  or if
your  employment  or service is                                      terminated at a time
when you could be  terminated  for Cause.  In addition,  if
                                     you are not terminated for Cause but the
 Administrator  later  determines  that                                      you could
 have been  terminated  for Cause if all facts had been  known at that
                                     time,   your   Option   will   terminate
  immediately   on  the  date  of  such
                                     determination.   If  you  have   submitted  a
 notice  of  exercise   while  the                                      Administrator  is
 considering  whether  you  should  be (or  could  have  been)
                                     terminated   for  Cause,   your   exercise   will
 be  suspended   pending  such                                      determination.   If
 it  is  determined  that  you  are  (or  could  have  been)
                                     terminated for Cause,  your Option will terminate,
 your notice of exercise will                                      be rescinded and your
exercise price will be returned to you. 

	 	
For
 this  purpose,  "Cause"  means  (i)  the  commission  by you of any  act or
                                     omission  that would  constitute a felony  under
 federal,  state or  equivalent                                      foreign law; (ii)
fraud, dishonesty,  theft,  embezzlement,  disclosure of trade
                                     secrets or confidential  information or other acts
or omissions that result in a                                      breach of any
fiduciary duty of the Company. 

	Manner of
Exercise: 	  	                  You may  exercise  this Option only to the extent  vested and
only if the Option                                      has not  terminated.  To exercise
this Option,  you must complete the "Notice of                                      Stock
 Option  Exercise"  form  provided  by  the  Company.  The  form  will  be
                                     effective  when it is  received  by the  Company.
 However,  the  Shares you are                                      electing to purchase
 will not be delivered  until you pay the Company the total
                                     exercise  price  and all  applicable  withholding
 taxes  due as a result of the                                      exercise. 

	 	
If
someone  else wants to  exercise  this Option  after your death,  that person
                                     must contact the Company and prove to the Company's
 satisfaction that he or she                                      is entitled to do so. 

	 	
Your
 ability  to  exercise  the  Option  may be  restricted  by the  Company if
                                     required by applicable law. 

	Change of
Control: 	  	                   Upon a Change of Control (as defined in the Plan): 

	 	o 	The
Option will become fully vested and exercisable, and  

	 	                                     o 	You
will have the right,  exercisable  by written notice to the Company
                                           within  sixty  (60)  days  after the  Change
of  Control,  to  receive  in                                            exchange  for
 surrender  of the  Option an  amount  of cash  equal to the
                                           excess of the Fair Market  Value of the Shares
then  covered by the Option                                            over the Exercise
Price for such Shares. Restrictions on Resale:              By accepting this Option,
 you agree not to sell any Shares  acquired under this
                                     Option at a time when applicable laws,  Company
policies or an agreement between                                      the Company and its
underwriters prohibit a sale.  

	Notice of
Sale:  	  	                      If this Option is  designated as an Incentive  Stock  Option,
 you must promptly                                      report to the Secretary of the
Company any  disposition  of the Shares  acquired
                                     under  this  Option  that is made  within  two (2)
years  from the Grant Date or                                      within  twelve (12)
months from the date you  acquired  the Shares (the  "Notice
                                     Period").  In addition,  the Company may, at any
time during the Notice  Period,                                      place a legend or
legends on any  certificate(s)  for the  Shares  issued  under
                                     this Option  requesting  the Company's  transfer
 agent to notify the Company of                                      any transfer of the
Shares. 

2 

	Miscellaneous: 	  o	
       As a condition of the granting of this Award,  you agree,  for yourself
                                           and your legal representatives or guardians,
 that this Agreement shall be                                            interpreted  by
the  Administrator  and  that  any  interpretation  by the
                                           Administrator  of the  terms  of  this
 Agreement  or  the  Plan  and  any
                                           determination made by the Administrator
 pursuant to this Agreement or the                                            Plan shall
be final, binding and conclusive.  

	 	                                     o 	This
Agreement may be executed in counterparts.  

This Option is granted under and
governed by the terms and conditions of the Plan. Additional provisions regarding your
Option and definitions of capitalized terms used and not defined in this Option can be
found in the Plan. 

BY SIGNING BELOW AND ACCEPTING
THIS STOCK OPTION AWARD, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED HEREIN AND
IN THE PLAN. YOU ALSO ACKNOWLEDGE RECEIPT OF THE PLAN. 

		
	REGAL-BELOIT CORPORATION	 
	

By: ____________________________	___________________________________
	   
     Authorized Officer	Optionee

3 

REGAL-BELOIT
CORPORATION 
NOTICE OF STOCK OPTION
EXERCISE 

Your completed form should be
sent by mail or fax to:____________________________. Phone: ___________________ Fax:
_____________________________________. Incomplete forms may cause a delay in processing
your option exercise.  

PART 1:   OPTIONEE INFORMATION:
  Please complete the following.   PLEASE WRITE YOUR FULL LEGAL NAME SINCE THIS NAME WILL
BE ON YOUR STOCK CERTIFICATE.  

Name:________________________________________________________________________ 

Street Address:
________________________________________________________________ 

City:
__________________________            State:_________________      Zip Code:_______________ 

Work Phone #: (_____) -
_______- ________    Home Phone #: (_____) - _______- __________ 

Social Security #: ______
— _____ — _______ 

PART 2:   DESCRIPTION OF OPTION(S)
BEING EXERCISED   Please complete the following for each option that you wish to
exercise.  

	Date of Grant
	Type of Option

(specify ISO or

NQSO)
	Exercise Price Per

Share
	Number of

Options Being

Exercised
	Aggregate Exercise Price

(multiply Exercise Price Per

Share by Number of Options

Being Exercised)

	 	 	$	 	$
	 	 	$	 	$

The Total Exercise Price for all of
the options being exercised (as listed above) is: $_________________. 

PART 3:    METHOD OF PAYMENT OF
OPTION EXERCISE PRICE   Please select only one:  

	|_|  	Cash
Exercise. I am enclosing a check or money order payable to "Regal-Beloit Corporation"
for the Total Exercise Price. 

	|_|  	Stock
Swap – Share Delivery. I am enclosing the following certificate(s) for shares of
Regal-Beloit Corporation common stock that I have owned for at least six months and/or
that I have purchased on the open market to pay for all or a part of the Total Exercise
Price. I (and my spouse, if applicable) have completed and signed the attached Stock
Power, which signatures are guaranteed by a bank, broker, dealer, credit union, savings
association or other entity which is a member in good standing of the Securities Transfer
Agents Medallion Program. The fair market value of these shares (as defined in the Plan)
will be determined on the date this Notice is received by Regal-Beloit Corporation. 

4 

	Certificate Number
	Certificate Date
	Number of Shares

	 	 	 
	 	 	 
	 	 	 

	 	
The
Company is instructed to (select only one):  

	 	|_| 	Apply
the maximum number of shares represented by the stock certificate(s) listed above (in the
order listed) as are needed to cover the Total Exercise Price. If any fractional share
remains, the Fair Market Value of that fraction will be paid to me in cash. I will
receive a new certificate for the number of shares not needed to cover the Total Exercise
Price. If the total number of shares represented by the stock certificates listed above
are not sufficient to cover the Total Exercise Price, please notify me of the additional
amount owed and I will immediately remit a check or money order made payable to “Regal-Beloit
Corporation” for the balance of the Total Exercise Price. I understand that the
Company will not process my option exercise until it receives the check or money order
for the balance due.  

	 	|_| 	Apply
only ________ of the shares represented by the stock certificate(s) listed above (in the
order listed) toward the Total Exercise Price. Please notify me of the additional amount
owed and I will promptly remit a check or money order made payable to “Regal-Beloit
Corporation” for the balance of the Total Exercise Price. I understand that the
Company will not process my option exercise until it receives the check or money order
for the balance due.  

	|_|  	Stock
Swap – Attestation. I am enclosing an Attestation Form with respect to shares of
Regal-Beloit Corporation common stock that I have owned for at least six months and/or
that I have purchased on the open market to pay all or a part of the Total Exercise
Price. I (and my spouse, if applicable) have completed and signed the attached
Attestation Form. The fair market value (as defined in the Plan) of these shares will be
determined on the date this Notice and the Attestation Form is received by Regal-Beloit
Corporation. I understand that the number of shares I will receive is the number of
shares being exercised reduced by the number of shares used in the Attestation to pay all
or a part of the Total Exercise Price. 

	|_|  	Cashless
Exercise Through a Broker-Dealer. I have requested through the broker specified below
to (select only one): 

	 	|_| 	Sell
to Cover. Sell or margin only enough of the option being exercised to cover
the Total Exercise Price (and tax withholding, if elected in Part 5), deliver the sale or
margin loan proceeds directly to Regal-Beloit Corporation, and deposit the remaining
shares and any residual cash in my brokerage account. 

	 	|_| 	Same-Day-Sale.
Sell or margin all of the shares of common stock issuable upon exercise of the
options, deliver a portion of the sale or margin loan proceeds directly to Regal-Beloit
Corporation to pay the Total Exercise Price (and tax withholding, if elected in Part 5),
and deposit any remaining cash proceeds in my brokerage account. 

	 	
Sale Price*: ______________________   Sale Date*: ____________________________________ 

	 	
*The
sale price and sale date are required in order to execute the cashless exercise. 

5 

	 	
Broker-Dealer Name: _________________________________________________________  

	 	
Contact Person: ______________________________________________________________ 

	 	
DWAC – Depository Trust Company (DTC) #: ____________________________________

	 	
Brokerage
Account #: _________________________________________________________

	 	
Broker Phone #:  (______)-_______ - _________      Broker Fax #:  (______)-_______ - _________  

It is your
responsibility to contact a broker to open a brokerage account and sell your stock option
shares. 
Regal-Beloit Corporation WILL NOT send this form to your broker.  

PART 4:   CERTIFICATE INSTRUCTIONS
  To be completed for cash or stock-swap exercises only. You must check one. (Shares issued
pursuant to a cashless exercise through a broker-dealer will be automatically sent to your
specified broker.)  

Name(s) in
which the certificate for the purchased shares will be issued:  

	|_|  	In
my name only

	|_|  	In
the names of my spouse and myself as community property

	|_|  	In
the names of my spouse and myself as joint tenants with the rights of survivorship

Spouse’s name (if applicable):
_______________________________________________ 

The certificate for the purchased
shares should be sent to the following address (complete only if to be sent to a
different address than specified in Part 1): 

Street Address:
________________________________________________________________  

City: ___________________________
   State:_________________     Zip Code:_______________ 

PART 5:   METHOD OF SATISFYING TAX
WITHHOLDING OBLIGATION   Please select only one. You do not need to complete this Part if
you are exercising only incentive stock options (ISOs) or if you are a non-employee
director.  

	|_|  	Broker
Exercise. I have elected to exercise my option(s) through a broker in Part 3. The
broker will sell sufficient shares to pay for the tax amount and will remit that amount
to Regal-Beloit Corporation. 

	|_|  	Cash.
I am enclosing a check or money order payable to “Regal-Beloit Corporation” for
the withholding tax amount. 

	|_|  	Tax
Amount Request. Please notify me of the minimum statutory withholding obligation that
will be due as a result of this option exercise. I understand that, after receiving
notification of the withholding tax amount, I must immediately remit a check or money
order payable to “Regal-Beloit Corporation” for that amount. I understand that
the Company will not process my option exercise until it receives the check or money
order covering the withholding tax amount due. 

6 

	|_|  	Share
Withholding. I request that Regal-Beloit Corporation withhold a number of shares of
stock otherwise issuable to me as a result of exercising the option(s) to cover the minimum required
Federal and state tax withholding amount. I understand that I may be liable for
additional taxes due. 

PART 6:   ACKNOWLEDGEMENTS AND
SIGNATURE  

	1.  	I
understand that all sales of the Regal-Beloit Corporation common stock
                    received upon exercise of this option are subject to compliance with
the                     company’s policy on securities trades. 

	2.  	I
hereby acknowledge that I have read a copy of the prospectus describing the
                    Regal-Beloit Corporation plan under which the option(s) listed above
were                     issued, and understand the tax consequences of an exercise. 

	3.  	I
understand that this notice cannot be revoked by me if I have selected a
                    cashless exercise through a broker-dealer. I personally guarantee
that the Total                     Exercise Price and applicable taxes will be paid to
Regal-Beloit Corporation in                     full in the event the Company does not
receive the full amount from the Broker                     for any reason. 

Signature:  ______________________________________________
                 Date: _________________________ 

* * * * * * 

To be completed by
Treasury Department:  

Received by:
______________________________________________________________________________ 

Date received:
______________________________________________________________________________

7 

REGAL-BELOIT
CORPORATION 
ATTESTATION FORM 

I am filing a Notice of Stock Option
Exercise with Regal-Beloit Corporation (the “Company”), and I am electing to pay
some or all of the Total Exercise Price by attesting to the ownership of shares of Company
common stock that I have owned for at least six months or that I purchased on the open
market (the “Payment Shares”). I am tendering these shares in payment of some or
all of the Total Exercise Price as a result of exercise without making actual delivery of
the Payment Shares to the Company. 

	1. 	 I
attest to the ownership of the following Payment Shares: 

	Certificate Number
	Certificate Date
	Number of Shares

	 	 	 
	 	 	 
	 	 	 

	2.  	I
certify that I have either held the Payment Shares for at least six months
                    after acquiring them from the Company or purchased the shares on the
open                     market. 

	3.  	I
represent that I, with the consent of the joint owner (if any) of the Payment
                    Shares, would have full power to deliver and convey the stock
certificates                     evidencing the Payment Shares to the Company and could
have caused the Company                     to become sole owner of the Payment Shares. 

	4.  	The
joint owner (if any) of the Payment Shares, by signing this form, consents
                    to the above representations and the payment of some or all of the
Total                     Exercise Price (as selected below) by applying the Payment
Shares. 

	5.  	The
Company is instructed to (select only one): 

	 	|_| 	Apply
the maximum number of shares represented by the stock certificate(s) listed above (in the
order listed) as are needed to cover the Total Exercise Price. If any fractional share
remains, the Fair Market Value of that fraction will be paid to me in cash. If the total
number of shares represented by the stock certificates listed above are not sufficient to
cover the Total Exercise Price, please notify me of the additional amount owed and I will
immediately remit a check or money order made payable to “Regal-Beloit Corporation” for
the balance of the Total Exercise Price. I understand that the Company will not process
my option exercise until it receives the check or money order for the balance due. 

	 	|_| 	Apply
________ of the shares represented by the stock certificate(s) listed above (in the order
listed) towards the Total Exercise Price. Please notify me of the additional amount owed
and I will immediately remit a check or money order made payable to “Regal-Beloit
Corporation” for the balance of the Total Exercise Price. I understand that the
Company will not process my option exercise until it receives the check or money order
for the balance due. 

8 

	6.  	I
understand that I will receive a stock certificate for the net of the total number of
options being exercised reduced by the number of Payment Shares. 

Dated: ______________________________________________________ 

Print Name of Optionee:
______________________________________________________  

Signature of Optionee:
________________________________________________________  

Dated:
______________________________________________________ 

Print Name of Joint Owner:
______________________________________________________  

Signature of Joint Owner:
________________________________________________________  

9REGAL-BELOIT
CORPORATION 
2007 EQUITY INCENTIVE
PLAN 
RESTRICTED STOCK AWARD 

[Name]
[Address]  

You have been granted a Restricted
Stock award for shares of common stock of Regal-Beloit Corporation (the
“Company”) under the Regal-Beloit Corporation 2007 Equity Incentive Plan (the
“Plan”) with the following terms and conditions: 

	Grant Date: 	
                       __________, 200_

	Number of Restricted Shares:  	
__________________ Shares

	Vesting Schedule: 	
                 One  hundred  percent  (100%)  of your  Restricted  Shares  will vest on
the third                                    anniversary of the Grant Date.

	 	
Upon
your  termination  of employment or service,  you will forfeit the Restricted
                                   Shares that have not yet vested. 

	Escrow:  	Your
 Restricted  Shares will be held in escrow by the Company,  as escrow  agent.
                                   The Company  will give you a receipt for the Shares
held in escrow that will state                                    that the  Company
 holds such  Shares in escrow for your  account,  subject to the
                                   terms of this  Award,  and you will give the Company a
stock power for such Shares                                    duly  endorsed in blank
which will be used in the event such Shares are  forfeited
                                   in  whole  or in  part.  As  soon as  practicable
 after  the  vesting  date,  the                                    Restricted  Shares
will cease to be held in escrow,  and  certificate(s)  for such
                                   number of Shares will be delivered  to you or, in the
case of your death,  to your                                    estate.

	Transferability of Restricted Shares: 	
                You may not sell,  transfer,  pledge or otherwise  alienate or
hypothecate  any of                  your  Restricted  Shares  until
they are vested.  In addition,  by accepting  this
                                   Award,  you agree not to sell any Shares  acquired
under this Award at a time when                                    applicable  laws,
 Company  policies or an  agreement  between the Company and its
                                   underwriters prohibit a sale.

	Voting and
Dividends: 	              While the Restricted  Shares are subject to  forfeiture,  you may
not exercise any                                    voting rights. You will,  however,
 receive all dividends and other  distributions                                    paid
with respect to the Restricted  Shares so long as the applicable  record date
                                   occurs  before you  forfeit  such  Shares.  If,
 however,  any such  dividends  or                                    distributions are
paid in Shares,  such Shares will be subject to the same risk of
                                   forfeiture,  restrictions on transferability  and
other terms of this Award as are                                    the Restricted Shares
with respect to which they were paid.

	Change of
Control:  	                 Upon a Change of Control,  the Restricted  Shares shall vest in
full and you shall                                    have the right,  exercisable  by
written  notice to the Company  within sixty (60)                                    days
after the Change of Control,  to receive in  exchange  for the  surrender  of
                                   your  Restricted  Stock an amount of cash equal to the
Fair  Market  Value of such                                    Shares.

	Tax Withholding: 	
To the extent that the receipt or the vesting of the Restricted Shares
results in income to you for Federal, state or local
income tax purposes, you shall deliver to the
Company at the time the Company is obligated to withhold taxes in
connection with such receipt or vesting, as the
case may be, such amount as the Company requires to
meet its statutory minimum withholding obligation under
applicable tax laws or regulations, and if you fail
to do so, the Company has the right and authority to
deduct or withhold from other compensation payable to you
an amount sufficient to satisfy its withholding
obligations. If you do not make an election under
Section 83(b) of the Internal Revenue Code of 1986, as amended,
in connection with this Award, you may satisfy the
withholding requirement, in whole or in part, in
cash or by electing to have the Company withhold for its own
account that number of Restricted Shares otherwise
deliverable to you from escrow hereunder on the date
the tax is to be determined having an aggregate Fair Market
Value equal to the minimum statutory total tax that
the Company must withhold in connection with the
vesting of such Shares. Your election must be irrevocable,
in writing, and submitted to the Secretary of the
Company before the applicable vesting date. The
Fair Market Value of any fractional Share not used to satisfy
the withholding obligation (as determined on the date
the tax is determined) will be paid to you in cash.
You should consult your own tax advisor to determine the
tax effect to you of restricted stock granted to you
by the Company. 

	Miscellaneous: 	o	
       As a condition  of the  granting of this Award,  you agree,  for yourself
                                            and your legal  representatives  or
guardians,  that this Agreement shall                                             be
interpreted by the  Administrator  and that any  interpretation by the
                                            Administrator  of the  terms  of  this
 Agreement  or the  Plan  and  any
                                            determination made by the Administrator
 pursuant to this Agreement shall                                             be final,
binding and conclusive. 

	 	                                   o 	This
Agreement may be executed in counterparts.  

This Restricted Stock Award is
granted under and governed by the terms and conditions of the Plan. Additional provisions
regarding your Award and definitions of capitalized terms used and not defined in this
Award can be found in the Plan.  

BY SIGNING BELOW AND ACCEPTING
THIS RESTRICTED STOCK AWARD, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED HEREIN
AND IN THE PLAN. YOU ALSO ACKNOWLEDGE RECEIPT OF THE PLAN. 

		
	REGAL-BELOIT CORPORATION	 
	

By: _______________________________	___________________________________
	
       Authorized Officer	Participant

2

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