Document:

<PAGE>

                                                                    EXHIBIT 10.8

                                 BASIC AGREEMENT
                                     BETWEEN
                              Warner Electric, LLC
                                       and
                               United Steelworkers
                                       and
                              Local Union No. 3245
                               For Contract Years
                      May 17, 2006 through February 1, 2009

<PAGE>

                       WARNER ELECTRIC BRAKE SAFETY POLICY

-    Safety is our first priority. Safety concerns must be managed before other
     business concerns can be successfully accomplished.

-    Working safely is a condition of employment. All employees are required to
     work safely and follow all safety rules and regulations.

-    No job is so important that it cannot be done safely. Safety precautions
     must be taken before and during any job.

-    All injuries can be prevented. With management taking responsibility to
     ensure a safe environment and all of us working safely, this is a realistic
     goal.

-    Every employee is responsible for preventing injuries. When we all work
     safely, act safely, and report any unsafe condition, we are doing our part
     to prevent injuries.

-    Training employees to work safely is essential. For every employee to be
     responsible for safety, he/she must know what safe conditions, acts, and
     operations are. To achieve that level of understanding, appropriate
     training will be given.

-    All operating exposures can be safeguarded. To ensure safe working
     conditions, all areas or points that are dangerous and cannot be
     practically eliminated, will be safeguarded by way of safety devices,
     warnings, guards, personal protective equipment or other appropriate means.

                                        2

<PAGE>

                                      INDEX

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----
<S>                                                                         <C>
I    Intent, Purpose and Scope of Agreement                                   5
II   Recognition                                                              5
III  Hours of Work                                                            7
IV   Overtime and Allowed Time                                                7
     Holidays - Paragraph 26                                                  8
     Overtime Distribution - Paragraph 30                                     9
     Call-In/Report-In Pay - Paragraph 34                                    10
     Bereavement Pay - Paragraph 35                                          10
V    Vacations                                                               11
VI   Seniority                                                               13
     General                                                                 13
     Rule for Applying Seniority                                             14
     Seniority Defined                                                       14
     Transfer of Seniority                                                   14
     Decrease in Forces                                                      14
     Recall to Occur As Follows                                              16
     Loss of Seniority                                                       17
     Probationary Period                                                     18
     Information to the Union                                                18
     Shift/Job Transfers                                                     19
     Temporary Transfer                                                      19
     Job Posting                                                             19
VII  Military Service                                                        20
VIII Leave of Absence                                                        20
     Jury Service - Paragraph 81                                             21
IX   Adjustment of Grievances                                                21
     To File a Grievance - Paragraph 86                                      22
     Suspension - Paragraph 102                                              24
X    Bulletin Boards                                                         25
XI   Wages                                                                   25
     Job Descriptions/Evaluations -
     Paragraph 106                                                           25
     Temporary Transfer Rate - Paragraph 116                                 26
     Shift Differential - Paragraph 117                                      26
XII  Cost-of-Living                                                          27
XIII Safety and Health                                                       29
XIV  Insurances and Pensions                                                 31
XV   Severance Allowance                                                     31
XVI  Termination, Expiration and Scope                                       32
XVII Compliance with Law                                                     33
Appendix A - Classification by Pay Rate                                      37
Appendix B - Rate Retention Groups                                           39
Appendix C - Overtime Distribution Agreement                                 39
Appendix D - Overtime Groups                                                 42
Appendix E - Insurances                                                      43
Insurance Agreement                                                          45
</TABLE>

                                        3

<PAGE>

                             NOTICE TO ALL EMPLOYEES

                                 WHEN UNABLE TO

                                 REPORT FOR WORK

                                      CALL

                                 (815) 389-4300

                              OR YOUR SUPERVISOR'S

                              DIRECT PHONE NUMBER.

                              THIS WILL ENABLE THE

                              COMPANY TO ACCURATELY

                                  MAINTAIN YOUR

                               ATTENDANCE RECORD.

                          TO LEAVE AN EMERGENCY MESSAGE

                                      CALL

                                 (815) 389-7777

                          LEAVE YOUR NAME, TELEPHONE #,

                            AND MESSAGE AND HANG UP.

                         YOUR EMERGENCY MESSAGE WILL BE

                                  RESPONDED TO.

                                        4

<PAGE>

                                    AGREEMENT

1. This Agreement is made and entered into May 17, 2006 by and between WARNER
ELECTRIC, LLC, or its successors or assigns, (hereinafter referred to as the
"COMPANY") and the UNITED STEELWORKERS (hereinafter referred to as the "UNION")
on behalf of itself and Local Union No. 3245. The Company will furnish each
present or new employee with a copy of this Agreement.

                                    ARTICLE I
                     INTENT, PURPOSE AND SCOPE OF AGREEMENT

2. It is the intent and purpose of this Agreement to set forth herein the basic
rules covering rates of pay, hours of work, and conditions of employment to be
observed by the parties hereto. It is further understood and agreed that this
Agreement together with any written appendices, supplements or letters of
understanding hereto contains all understandings between the Company and the
Union. This Agreement cannot be modified or amended except in writing signed by
the Company and the Union. No individual shall have any right to modify, amend
or revoke this Agreement.

3. This Agreement relates to the South Beloit plant of the Company located at
449 Gardner Street, South Beloit, Illinois.

4. The Company and Union will apply the provisions of this Agreement to all
employees, without discrimination as to age (as provided in appropriate laws),
sex, color, national origin, race or religion.

5. COOPERATION - The Union, the Company and all employees covered by this
Agreement mutually agree to make every reasonable effort to maintain and improve
the skill, efficiency, ability, and production of all employees, the quality of
products, the methods and facilities of production, and to eliminate accidents,
waste, conserve material and supplies and improve quality of workmanship.

                                   ARTICLE II
                                   RECOGNITION

6. The Company hereby recognizes the Union as the exclusive bargaining agent for
all its production, maintenance, and service employees, excluding Sales Persons,
Service Manager, Assistant Service Manager, Service School Instructors, office
and plant clerical employees, technical employees, timekeepers, Industrial
Engineering Department employees, security personnel, plant superintendents,
assistant superintendents, supervisors, assistant supervisors, and other
supervisory employees with authority to hire, promote, discharge, discipline or
otherwise effect changes in the status of the employees, or effectively
recommend such action, in all those matters specifically provided for herein
pertaining to wages, hours, and working conditions.

7. The Union hereby recognizes that the Management of the plant and the
direction of the working forces including the right to direct, plan, and control
plant operations, and establish and change production schedules, the right to
hire, promote, demote, transfer, suspend or discharge employees for proper
cause, or to relieve employees because of lack of work or for other legitimate
reasons, subject to the provisions of this Agreement, or the right to introduce
new and improved methods or facilities, or to change existing production methods
or facilities, and to manage the properties, is vested in the Company.

                                        5

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8. No employee shall engage in any activity not authorized by the Company, which
shall interfere with production. This section shall not restrict the legitimate
activities of the Shop Committee members pursuant to Article IX, Par. 97, Safety
Committee members pursuant to Article XIII Par. 134, and the members of the Job
Evaluation Committee, Worker's Compensation Committee, Civil Rights Committee,
Group Insurance Committee, Pension Committee and Apprenticeship Committee as
authorized by the appropriate Company representatives.

9. Any employee who is a member of the Union in good standing on the effective
date of this Agreement shall, as a condition of employment, maintain membership
in the Union to the extent of paying the periodic membership dues uniformly
required of all Union members.

10. Any employee who, on the effective date of this Agreement, is not a member
of the Union and any employee thereafter hired, shall, as a condition of
employment, starting thirty (30) days after the effective date of this
Agreement, or thirty (30) days following the beginning of their employment,
whichever is the later, acquire and maintain membership in the Union to the
extent provided in Paragraph 9 above.

11. The Union agrees that it will make membership in the Union available to all
employees covered by this Agreement on the same terms and conditions as are
generally applicable to other members of the Union. At the instance of the
Company, termination of Union membership for reasons other than the failure of
the employee to tender the dues, assessments and initiation fees specified in
this Agreement, may be submitted to an impartial arbitrator under the grievance
procedure of the Agreement for determination only as to whether such termination
conforms to the Constitution of the United Steelworkers.

12. On receipt of a voluntary written assignment authorizing such deduction from
the employee on whose account such deductions are made, the Company shall deduct
union dues, initiation fee, and assessments in accordance with the Constitution
of the United Steelworkers, as certified to the Company by the International
Treasurer of the Union. The Company shall deduct Union dues on a weekly basis,
based on the employee's earnings from that week. Any sum deducted by the Company
pursuant to this paragraph shall be remitted promptly by it to the International
Treasurer of the Union.

13. Should the International Treasurer of the Union certify to the Company in
writing that changes in dues or initiation fees have been duly adopted by the
United Steelworkers, during the term of this Agreement, the Company shall deduct
the changed dues or initiation fees have duly adopted by the United
Steelworkers, during the term of this Agreement, the Company shall deduct the
changed dues or initiation fees in the manner provided in Par. 12.

14. The Union shall indemnify and hold the Company harmless against all suits,
claims, demands and liabilities that shall arise out of or by reason of any
action that shall be taken by the Company for the purpose of complying with
these foregoing provisions or in the reliance on any list or certificate which
shall have been furnished by the Company under these provisions.

15. During the life of this Agreement, the Union agrees that there will be no
strikes, stoppages, or slowdowns; the Company agrees that there shall be no
lockouts. Both parties promise and agree that they shall, in an endeavor to
prevent such events from taking place, charge their representatives, committees,
and agents with full responsibility for the performance of each and every
promise and undertaking herein contained. No meetings of the Union's membership

                                        6

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shall be scheduled during regular working hours without mutual agreement of the
parties in writing.

16. Except during an emergency, employees excluded from the provisions of this
agreement shall not perform production or maintenance work. Instruction,
engineering analysis, continuous improvement team activities, assistance in
debugging machinery, product demonstrations, lab work, and safety and ergonomic
evaluations do not constitute production or maintenance work.

                                   ARTICLE III
                                  HOURS OF WORK

17. This article defines the normal hours of work and shall not be construed as
a guarantee of hours of work per day or per week. This Article shall not be
considered as any basis for the calculation or payment of overtime, which is
covered solely by Article IV, "Overtime."

18. The normal workday shall be eight (8) hours of work in a twenty-four (24)
hour period. The hours of work shall be consecutive except when an unpaid lunch
period is provided in accordance with prevailing practices.

19. Rest periods shall be provided and taken as follows:

     First Shift:  9:30 a.m. to 9:45 a.m.   - 15 minutes
                   12:30 p.m. to 12:40 p.m. - 10 minutes

     Second Shift: 5:30 p.m. to 5:45 p.m.   - 15 minutes
                   9:00 p.m. to 9:10 p.m.   - 10 minutes

     Third Shift:  1:00 a.m. to 1:15 a.m.   - 15 minutes
                   4:40 a.m. to 4:50 a.m.   - 10 minutes

On regular six (6) hour shifts on Saturday and Sunday, rest periods shall be
provided and taken as follows:

     All Shifts: Three (3) hours into the six (6) hour shift. - 15 minutes

except that rest periods shall be staggered by the Company where necessary to
insure continuous production operations. Relief personnel will be assigned to
the continuous production operation to provide the relief period for the
operator.

20. The normal work pattern shall be five (5) consecutive workdays beginning at
12:01 a.m. Monday of each week, or at the time on Monday at which the employee
begins work. Seven (7) consecutive days beginning at 12:01 a.m. Monday shall
constitute a payroll week.

                                   ARTICLE IV
                            OVERTIME AND ALLOWED TIME

21. This Article provides the basis for the calculation of, and payment for,
overtime and shall not be construed as a guarantee of hours of work per day or
per week, or a guarantee of days of work per week.

The payroll week shall consist of seven (7) consecutive days commencing at 12:01
a.m. Monday for the purpose of computing the pay of employees.

                                        7

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22. Time and one-half shall be paid for hours worked in excess of forty (40)
hours in a payroll week; all contractual paid time and union time, shall for
purposes of this provision, be treated as time paid.

23. Double time shall be paid for all hours worked on Sunday.

24. In all instances of premium pay for work on a day as such, the employee's
entire shift shall be considered as having been worked on the day on which their
shift is regularly scheduled to commence, except if the employee's first regular
shift of the work week begins between 10:00 p.m. and 12:00 midnight on Sunday,
during such week, each shift shall be considered as having been worked on the
day their shift is scheduled to end.

25. Work performed by employees on their floating holiday, or on a Holiday, will
be on a voluntary basis, and will be paid at double time plus holiday pay. The
scheduling of floating holidays during the Christmas period will be at the
employee's discretion.

26. Holidays

                               Contract Year 2006

April 14 - Good Friday (Friday)
May 29 - Memorial Day (Monday)
July 3 - Day Before Independence Day (Monday)
July 4 - Independence Day (Tuesday)
September 4 - Labor Day (Monday)
November 23 - Thanksgiving (Thursday)
November 24 - Day after Thanksgiving (Friday)
December 24 - Christmas Eve (Sunday) Celebrated December 25
December 25 - Christmas Day (Monday) Celebrated December 26
December 31 - New Years Eve (Sunday) Celebrated January 1
January 1, 2007 - New Years Day (Monday) Celebrated January 2

                               Contract Year 2007

April 6 - Good Friday (Friday)
May 28 - Memorial Day (Monday)
July 4 - Independence Day (Wednesday)
September 3 - Labor Day (Monday)
November 22 - Thanksgiving (Thursday)
November 23 - Day after Thanksgiving (Friday)
December 24 - Christmas Eve ( Monday)
December 25 - Christmas Day (Tuesday)
December 31 - New Years Eve (Monday)
Jan. 1, 2008 - New Year's Day (Tuesday)

                               CONTRACT YEAR 2008

March 21 - Good Friday (Friday)
May 26 - Memorial Day (Monday)
July 4 - Independence Day (Friday)
September 1 - Labor Day (Monday)
November 27 - Thanksgiving (Thursday)

                                        8

<PAGE>

November 28 - Day after Thanksgiving (Friday)
December 24 - Christmas Eve (Wednesday)
December 25 - Christmas Day (Thursday)
December 31 - New Years Eve (Wednesday)
January 1, 2009 - New Years Day (Thursday)

One (floating) holiday to be scheduled in accordance with current vacation
scheduling process and paid as 8 hr. of classification rate as holiday pay for
employees hired on or before May 17, 2006.

27. The regular earned hourly rate shall be the average straight time hourly
earnings for the day on which the overtime was worked. The "average straight
time hourly earnings" shall be the employee's total straight time hourly
earnings for the day, divided by the actual hours worked for the day (including
any hours paid for under a guarantee of hours). Overtime rates as outlined above
shall be paid the employees for such hours worked in the following manner:

(A) Time and one-half shall be one and one-half times the regular earned hourly
rate of the employee.

(B) Double time shall be twice the regular earned hourly rate of the employee.

28. The overtime and/or the premium payments provided for in this Article shall
not be duplicated for the same hours worked and to the extent that hours are
compensated for at overtime or premium rates under one provision, they shall not
be counted as hours worked in determining overtime or premium pay under the same
or any other provisions.

29. When two or more rules are applicable, the one more favorable to the
employee will apply, but nothing contained herein shall be construed to require
or permit the pyramiding of premium and/or overtime rates.

30. Both parties agree that overtime shall be worked when necessary to permit
the proper operation of the Company. Overtime will be distributed among
employees in the overtime distribution groups identified in Appendix C, which
groups may be changed from time to time in recognition of new or revised job
classification and new or revised cost centers, subject to the grievance
procedure.

31. Holidays defined in Par. 26 of this Article will be paid for at the
employee's classification rate and the Cost-of-Living adjustment if not worked.

32. During the term of this Agreement the days (defined above) will be paid
holidays. To qualify for holiday pay, an employee must have completed the first
thirty (30) calendar days of their probationary period and must have worked
their assigned shift on their last scheduled workday before the holiday (which
may not be mandated to exceed 8 hours) and their assigned shift on their first
scheduled workday following the holiday. In cases of holidays which are observed
on Friday or Monday, neither the adjoining Saturday nor the adjoining Sunday
shall be considered as a "scheduled work day before" nor a "scheduled work day
after" the holiday for purposes of qualifying for holiday pay, and work on such
Saturday or Sunday shall be voluntary except that concerted refusal of such
overtime work and failure to work by an employee who had agreed to work shall be
disciplinable offenses. If an employee desires to be absent from work the
scheduled work day before or after a holiday, they must give reasonable notice
prior to the holiday; provided, however, if they are absent from work the
scheduled work day before or after a

                                        9

<PAGE>

holiday due to circumstances beyond their control, they will not be disqualified
from receiving unworked holiday pay. Otherwise eligible employees on disability
leaves of absence are eligible for holiday pay up to and including one
consecutive year of such leave(s) provided, however, that otherwise eligible
employees hired on or after January 28, 1984 on disability leaves of absence
shall be eligible for holiday pay up to and including thirty (30) consecutive
days following the commencement of such leave(s).

33. The classification rate shall be that of the payroll week in which the
holiday falls. If an employee is absent and does not have wages earned during
the holiday week, then the classification rate to be used shall be that of the
last payroll week the employee worked prior to the holiday week.

34. Employees who report for regular work, (unless notified not to do so,
including announcements by local news media) or who are called back to work from
off the plant, shall be given either a minimum of four (4) hours' work at the
applicable contract rate (with applicable premiums, if any) for the current
payroll period, (provided, that if the employee refuses an assignment of work
which they are qualified to do, they shall receive no pay). The provisions of
this Paragraph shall not apply in cases of strikes, work stoppages, in
connection with labor disputes, failure of utilities beyond the control of the
Company, or any acts of God which interfere with work being provided or an
outside cause which prevents access, egress or occupancy to the extent that work
cannot be provided to the employees.

35. Employees actively at work will be granted three (3) work days off with pay
at their classification rate to attend or make arrangements for the funeral of
their spouse, mother, father, sister, brother (including half-brothers and
half-sisters), son, daughter, grandchild, mother-in-law, father-in-law, or other
than a blood-related parent if it can be demonstrated without a reasonable doubt
that the employee's parent is other than the blood-related mother or father.
Such employee will receive bereavement pay entitlement for only one mother and
one father. Employees actively at work will be granted three (3) days off with
pay at their classification rate to attend or make arrangements for the funeral
of their brother-in-law or sister-in-law (defined as the brother(s) and/or
sister(s) of the employee's spouse, and the spouse(s) of the employee's
brother(s) and/or sister(s). The in-law relationship ceases to exist when the
marriage, which created the relationship, is terminated by divorce, annulment,
legal separation or death followed by remarriage. Employees actively at work
will be granted one (1) day off with pay at their classification rate to attend
or make arrangements for the funeral of the employee and spouses grandmother or
grandfather. An employee who has not previously been granted work days off with
pay for the funeral of his mother or father may notify the Company that he
elects, instead, such pay rights for the funerals of his maternal grandparents
or his paternal grandparents. In the event of such election, the funeral pay
rights otherwise applicable to the designated grandparents shall apply to the
employee's parents. Should the death occur during any of the employee's
scheduled weeks or days of vacation, the vacation thus interrupted will be
extended by the period of authorized bereavement. Should the death occur during
any of the employee's vacation, or a paid holiday, the vacation or holiday thus
interrupted will be extended by the period of authorized bereavement effected.

                                       10

<PAGE>

                                    ARTICLE V
                                    VACATIONS

36. An employee who has been on the payroll of the Company as of the anniversary
date of their employment, and prior to May 17, 2006 shall retain their current
earned vacation entitlement.

Employees hired on or after May 17, 2006 shall receive the following vacation
with pay:

<TABLE>
<CAPTION>
Service                          Vacation
-------                          --------
<S>                         <C>
1 but less than 3 years     1 week (5 days)

3 but less than 10 years    2 weeks (10 days)

10 but less than 20 years   3 weeks (15 days)

20 and over                 4 weeks (20 days)
</TABLE>

Full weeks of vacation are to be taken as full weeks; extra days may be taken
individually. However, employees with two weeks of vacation or more may take
their vacation time off entitlement in excess of one week as individual days.
Two (2) of the individual days may be taken in (1/2) day increments, subject to
the scheduling rules of Paragraph 38.

Employees on the active payroll of the Company on their 30th year of service
anniversary date shall receive a $100.00 award and on each such anniversary date
thereafter while on the active payroll.

The Company will issue vacation checks under the following guidelines. Full
week(s) vacation checks will be issued on the pay period preceding the start of
vacation. Pay for individual vacation days taken will be included in the
employee's regular check for the week it was taken. If an employee takes
vacation for all the days in a week when a holiday(s) occurs, except the
holiday(s) themselves, the vacation days will be paid in advance as if it were a
full week and the holiday(s) will be paid in the week after their occurrence.

37. Vacation pay shall be paid for all employees, beginning January 1, 2007, at
their base hourly rate. Base hourly rate to include shift differential.

38. (A) During any calendar year employees shall be permitted to select the time
for vacation subject to (B), (C), (D), (E) and (F) below so far as practicable,
provided the employee gives written notice to the Human Resources Department of
their preference before April 1, and provided that the Company may schedule in a
manner which takes into consideration the operating and maintenance needs of the
plant. Conflicts in requests shall be resolved on the basis of seniority. When
taking single days of vacation, you must notify your supervisor before the end
of your prior shift. Failure to do so will result in an absence. When taking
half (1/2) days vacation you must notify your supervisor before the end of your
prior shift. Failure to do so will result in an absence.

(B) The Company may schedule a vacation shutdown of 1 week's duration. In years
that the Company schedules a shutdown, notification to employees will be made by
March 15.

                                       11

<PAGE>

                                VACATION SHUTDOWN

<TABLE>
<S>         <C>         <C>
YEAR 2006   Wednesday   July 5
            Thursday    July 6
            Friday      July 7

YEAR 2007   Monday      July 2
            Tuesday     July 3
            Thursday    July 5
            Friday      July 6

YEAR 2008   Monday      June 30
            Tuesday     July 1
            Wednesday   July 2
            Thursday    July 3
</TABLE>

(C) When a vacation shutdown is scheduled, shutdown work requirements will be
announced at the time the shutdown is announced. Shutdown work requirements will
be filled voluntarily from the top of the seniority list in each classification
required, and if volunteerism does not meet the need, the balance of the
requirements will be met by assignment from the bottom of the seniority list up.
Shutdown work requirements that arise subsequent to March 15 will be filled by
volunteers from the top of the seniority list. Any employees asked to work will
be charged in accordance with Appendix C. Employees not asked to work during the
shutdown period will not be charged for any overtime. If an out of overtime
spread condition occurs because of the overtime worked during the shutdown
period, the Company shall have 30 days to bring the effected employees back into
the 30 hour overtime spread.

(D) Employees who are entitled to vacation and who work during vacation shutdown
will be permitted to request their vacation so far as practicable, and in
consideration of the operating and maintenance needs of the Company, at any
other time of the year. In instances where employee vacation requests conflict
with the Company's needs, vacations will be scheduled on the basis of seniority.

(E) In order to qualify for the vacation defined in Par. 36, an employee must
have worked not less than seventy (70) percent of the regular days of work
available to them during the twelve (12) months immediately preceding January 1
of any calendar year, except in the case of any employee who completes one (1)
year of service in the calendar year, it shall be twelve (12) months immediately
preceding their anniversary date. It is understood and agreed for this purpose
that the absence from work because of Company layoffs due to lack of work (not
to exceed ten [10] work weeks), occupational accidents, certified illness,
holidays, shall be considered as time worked for the purpose of computing
eligibility for vacation privileges.

(F) An employee may take pay in lieu for any earned vacation, not to exceed five
(5) days in any year. Such scheduling should be handled with the normal April 1
vacation scheduling procedure. Changes after the vacation schedule is
established must be consistent with production needs. Pay in lieu will normally
be included in the vacation check at the time the vacation is taken. This shall
not change the practice of paying for unused vacation at the end of each
calendar year. The Union will be informed of all pay in lieu arrangements. No
employee shall be discriminated against based upon his exercise or nonexercise
of this understanding.

                                       12

<PAGE>

39. In the event of the death of an employee eligible for vacation pay at the
time of their death, such vacation due the employee shall be paid to their
surviving spouse or other legal heir.

40. If any employee is laid off for a period equal to or longer than their
vacation, the employee may designate the equivalent portion of such layoff
period as their vacation with pay.

41. Vacation periods may not be postponed from one year to another and made
accumulative, and will be forfeited unless completed within each calendar year,
but in any event the employee will receive their vacation pay.

42. An employee entering military service who is eligible for vacation in the
year in which they enter and who has not received such vacation shall receive
the vacation pay to which they are entitled under this Article.

43 Any employee returning from military service who is eligible for vacation in
the year in which they return shall receive a vacation subject to the provisions
of this Article, except Par. 38 above, provided it is not in the same year in
which they enter. Their vacation pay will be paid in accordance with Paragraph
37.

44. In the event an employee has their vacation scheduled immediately upon
beginning work and therefore does not have any hours worked, their vacation pay
is computed by multiplying their rate for the job classification to which they
are assigned by their vacation hours.

45. Vacation Pay for Layoffs.

During any calendar year, if an employee is on layoff through no fault of their
own and solely as a result of such layoff they have not fulfilled the
requirements of Par. 38 (A) of this Article, and such an employee has had
earnings in the preceding calendar year, they shall be entitled to receive
vacation pay in accordance with Paragraph 37 as provided in Par. 36 of this
Article. Employees who are laid off may elect to receive their vacation pay at
the time of layoff under Paragraph 40 and, in accordance with Paragraph 40, a
corresponding portion of the layoff will be considered as the employee's
vacation time off at the time of layoff. If the employee does not elect his
vacation pay and time off at the time of layoff and is recalled in the same
calendar year, they will receive their vacation pay in accordance with Paragraph
46. If the employee does not elect their vacation pay at the time of layoff and
is not recalled during the calendar year, they will be paid any vacation pay
owing at the end of the calendar year.

46. In the event an employee has been on layoff and is recalled to work during
any calendar year, and such an employee has had earnings in the preceding
calendar year, but solely because of such layoff has not fulfilled the
requirements of Par. 38 (A) of this Article, they shall be entitled to vacation
pay as outlined in Par. 45 above. Upon returning to work anytime in the year,
such employee will be eligible to receive their vacation pay upon giving one
week's notice but vacation time off will be granted (if requested) consistent
with Paragraph 38 of this Article.

                                   ARTICLE VI
                                    SENIORITY

47. GENERAL. The Company and the Union recognize that promotional opportunity
and job security in the event of promotions, decreases of forces, and rehirings
after layoffs should increase in proportion to length of continuous service, and
that in the administration of this Article, full consideration shall be given
continuous service in such cases. "Continuous service"

                                       13

<PAGE>

as referred to herein, means a period of employment not interrupted by a break
sufficient to terminate the employee's seniority.

48. RULE FOR APPLYING SENIORITY. In all cases of promotion or increase or
decrease in forces except when a different rule is stated, the following factors
shall be considered; however, only where factors (B) and (C) are relatively
equal shall length of continuous service govern:

(A) Length of continuous service;
(B) Ability to perform the work;
(C) Physical fitness.

49. SENIORITY DEFINED. Length of continuous service as outlined in this Article
is defined herein as years, months, and days of service with the Company since
the last date of hire. In cases where two or more employees commence work on the
same date, the following method will determine the most senior employee:

     Shift 3 = Most Senior

     Shift 1 = Senior to employee who started on Shift 2

     Shift 2 = Least Senior

In the case of two or more employees starting on the same shift and same date,
at the orientation, between the Union, employees, and the Company, the employees
will draw a card from a deck of cards and the high card will determine the most
senior employee, which determination shall be final and govern all future issues
of relative seniority during their employment with the Company. All affected
employees who have not established permanent seniority shall do so as outlined
by the card drawing provisions of this article. When seniority is established
the Company will provide to the Union a listing of the employees affected and a
copy to the employee.

50. TRANSFER OF SENIORITY. Employees transferred from one classification to
another classification, by job bid or promotion shall transfer their seniority
to the new classification after twenty (20) working days on the job to which
they had bid or transferred, provided it is the last classification to which
they have bid or have been promoted. An employee thus transferred shall serve a
trial period of not less than one working day and not more than twenty (20)
working days, which period may be extended by mutual agreement. In cases covered
by the above employees will be allowed to wash themselves out during the trial
period (on the job to which they had bid or been promoted) by giving notice to
the Company not later than the twentieth (20th) day, provided they had not
previously held the classification in the previous two (2) years.

51. Employees who wash themselves out as above specified or who are washed out
by the Company shall be entitled to return to their former job classification
with full seniority. If there have been other personnel moves which have
resulted from their bid or promotion, the employees involved will be returned to
their former job classifications (to the extent that this is necessary in order
to accommodate the washout) with full seniority, and the Company will be
entitled to postpone the reverse moves caused by the washout until all resulting
personnel moves may be accomplished without the necessity of paying premium pay.

52. Employees who are transferred in lieu of layoff will immediately transfer
their seniority to the new classification.

53. DECREASE IN FORCES. When a reduction in force is necessary, forces shall be
reduced in the following manner: (Subject to the exceptions in Article XI, Par.
111).

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<PAGE>

54. The Company will allow in certain situations for a voluntary layoff to
occur. If this happens, the following guidelines will apply on a seniority
basis:

     a)   The voluntary layoff period will be for a maximum of four (4) weeks.
          This time period may be extended when the Company, Union and an
          employee mutually agree.

     b)   The voluntary layoff option will be made available to those Employees
          in the classification whose work assignments are being immediately
          affected by the reduction. No employee on voluntary layoff will be
          allowed to exercise their seniority in any classification.

     c)   When it is determined that a recall is needed, the person who went out
          on involuntary layoff would be recalled prior to a person who
          volunteered.

     d)   If it is determined that production needs change and all other options
          have been exhausted, the Company would have the option to recall a
          person on voluntary layoff.

     e)   Upon return from voluntary layoff the employee will return to his/her
          previous classification and shift.

     f)   During a voluntary layoff, a person would retain their Insurance
          consistent with the Insurance Agreement in the contract.

     g)   In the event there are insufficient volunteers for a required layoff,
          the procedures prescribed in this article concerning decreases in
          forces will apply.

55. (1) Probationary employees will be the first to be displaced from the
classification(s) to be reduced; (2) Next, employees who have not acquired
seniority in the classification as provided in Par. 50 shall be displaced from
the classification(s) to be reduced and shall be returned to the classification
in which they still hold seniority. (Employees who have been transferred into
the classification pursuant to Par. 56 shall be excepted from this group and
shall be considered on the basis of their total seniority as part of the group
considered in subparagraph (3) hereof). (3) Next, employees will be displaced
from such classification(s) on the basis of their seniority in the
classification, on the basis of the factors in Par. 48.

56. Employees who are displaced from their regular classification shall be
offered a job opportunity in a vacant job or in a job held by an employee with
less seniority, as follows:

     (1) To a job classification for which the employee is fully qualified by
previous classification and satisfactory performance in the job classification
for the Company, or

     (2) To a job classification for which the employee qualifies under the
factors set forth in Par. 48, without any training period.

57. Employees displaced in the above process shall be considered on the same
basis as specified in Par. 55 hereof for reduction of forces in a
classification. Such employees who are displaced in this process shall be given
a similar opportunity. Employees who are displaced under the above procedure and
who do not have sufficient seniority and qualification to secure another job
under the above procedure shall be laid off from the Company.

58. In the event of partial or complete shutdown of manufacturing operations
during straight-time hours for the purpose of taking inventory, seniority by
shift shall apply only among employees in the same job classification doing the
same type of work. Employees performing

                                       15

<PAGE>

such work will be paid at their classification rate. During overtime hours for
the purpose of taking inventory, the Appendix "C" Overtime Distribution
Agreement shall apply.

59. Employees who have completed their probationary period and who are scheduled
for a layoff for a period exceeding three (3) working days, shall be notified at
least three (3) working days prior to such layoff. The Union shall be notified
as soon as practicable after the Company makes the determination to lay off
employees. In the event an employee is temporarily laid off for a period of not
more than three (3) working days, due to lack of work or other legitimate
causes, the employee with the least continuous service in the classification
affected shall be laid off.

60. Employees may elect layoff instead of exercising their seniority rights to
displace a less senior employee in a different classification. (The Company will
provide the employee and Union with a list of the different classifications that
have less senior employees.) Employees electing layoff under this paragraph will
only be eligible for recall to their regular assigned classification or to such
other classifications as they designate in writing to Human Resources at the
time of layoff. Such employees shall be notified by certified mail that their
rights are due to expire. Such notice will state that they must accept the next
recall for which they are eligible or terminate their seniority and all
employment rights. In no event shall the employee's seniority be extended for a
period greater than that specified in 62(E). The president of the local union
shall appoint two (2) committee members to be present in the Layoff & Recall
meeting prior to notice being given to employees of such Layoff or Recall. Only
one (1) of the appointed members may be present at the meeting with the
employees.

61. RECALL TO OCCUR AS FOLLOWS:

     I.   When increasing the workforce in an area without adding to the overall
          plant headcount, both shift preference and recalls, direct and
          indirect, will be honored based on seniority. If the position is not
          filled through this process, then the position will be posted.

     II.  Opening occurs in classification that has employees on layoff and most
          senior person on layoff is from the classification that is being
          recalled.

          A. The person with the most seniority with the Company shall be
          recalled by telephone or certified mail.

          B. The person recalled is expected to advise the Company of their
          availability for recall upon contact by telephone, or if unable to be
          contacted by telephone, shall have forty-eight (48) hours after
          sending certified mail to notify the Company of their availability for
          work and must report for work not later than the beginning of their
          shift on the third working day following the day the notice to report
          was sent.

          (1) In the event the employee does not accept recall or fails to
          report for work, their seniority and all employment rights will be
          terminated.

     III. Opening occurs in classification that has employees on layoff.
          However, there are more senior employees on layoff from other
          classifications.

          A. The Company shall recall the most senior person, regardless of
          their classification, who are fully qualified to perform the work of
          that classification by:

                                       16

<PAGE>

               (1) Previous classification and satisfactory performance in the
               job classification for the Company, or

               (2) Under the factors set forth in Paragraph 48, Article VI of
               the Basic Agreement, without any training period.

          B. The person recalled is expected to advise the Company of their
          availability for recall upon contact by telephone, or if unable to be
          contacted by telephone, shall have forty-eight (48) hours after
          sending certified mail to notify the Company of their availability for
          work and must report for work not later than the beginning of their
          shift on the third working day following the day the notice to report
          was sent.

          In the event the employee does not accept recall or fails to report
          for work, their seniority and all employment rights will be
          terminated.

     IV.  Opening occurs in classification that has no employees on layoff.
          However, there are employees on layoff from other classifications.

          A. That job shall be posted in accordance with Article VI, Par. 69 of
          the Basic Agreement.

          B. After job posting and selection procedures have occurred, persons
          on layoff will be recalled to the job vacancy that would then exist in
          accordance with Part I and Part II, if applicable. If Part I and Part
          II are not applicable, persons will be recalled in accordance with
          length of continuous service, physical fitness and ability to perform
          the work, without any training period.

          C. The person recalled is expected to advise the Company of their
          availability for recall upon contact by telephone, or if unable to be
          contacted by telephone, shall have forty-eight (48) hours after
          sending certified mail to notify the Company of their availability for
          work and must report for work not later than the beginning of their
          shift on the third working day following the day the notice to report
          was sent.

          In the event the employee does not accept recall or fails to report
          for work, their seniority and all employment rights will be
          terminated.

          NOTE: Employee's recalled from layoff who are unable to return to work
          due to medical reasons shall be placed on medical leave of absence
          provided the employee accepts the recall.

62. LOSS OF SENIORITY. Continuous service as outlined in this Article shall be
broken and employees shall not be considered as having any length of continuous
service or any employment relationship whatsoever with the Company:

(A) If they shall quit;

(B) If they shall have been discharged for proper cause;

(C) If they fail to report for work, or make satisfactory explanation of such
failure within forty-eight (48) hours after notification has been sent to report
for work by certified mail, one

                                       17

<PAGE>

copy of such notification being tendered to the Union Committee. Such notice
shall not be sent unless such employee has been absent and has failed to notify
the Company by the middle of the employee's shift on the second consecutive
working day of the reason for such absence, or;

(D) If they fail to report on schedule following a vacation or an authorized
leave of absence without giving a reasonable excuse (employees who present an
excuse for such absence will be permitted to work after the presentation of the
excuse until such time as the Company decides whether to honor the excuse as an
exception to the rule) or;

(E) If they shall have been absent from the service of the Company for any
reason (except for a leave of absence for military service) for a period of two
(2) years, where such employee has been continuously employed for over ninety
(90) calendar days and not over two (2) years shall be considered as having lost
their seniority and employment relationship if they have been absent from the
service of the Company for a period equal to their length of service with the
Company. Absence due to a compensable disability incurred during the course of
employment shall not break continuous service provided such individual is
returned to work within thirty (30) days after final payment of statutory
compensation for such disability, or after the end of the period used in
calculating a lump sum payment.

63. PROBATIONARY PERIOD. A new employee, and others re-employed following a
break in continuous service, as outlined in Par. 62 above, will acquire
seniority after they have completed ninety (90) calendar days of employment,
exclusive of any periods of absence due to medical reasons of five or more
consecutive days, from the date of their employment or re-employment with the
Company. Such employees shall be considered probationary employees until they
have acquired seniority. There shall be no responsibility for the re-employment
of probationary employees if they are laid off or discharged during this period.
Probationary employees may file and process grievances after thirty (30)
calendar days from date of employment or re-employment but may be laid off or
discharged during their probationary period as exclusively determined by
Management.

64. INFORMATION TO THE UNION. Every three months the Company shall furnish the
Union with copies of a seniority list and post copies on the bulletin boards of
the Company. Once each month between the quarterly lists, the Company will
furnish the Union one copy of an updated seniority listing. The company will
also continue to provide the union with an updated list of shift preferences and
recalls periodically.

(A) No more than once per month, at the request of the union, the Company will
provide a list of hires, terminations, promotions, transfers and seniority of
bargaining unit employees during the preceding calendar month

(B) The Company will continue to provide the Union with copies of written leave
of absence forms, written disciplines, names of employees who are to be laid off
or who have been recalled (including the date of notice and the name of the job
classification involved), "employee record change requests" and notices that
appear on Company bulletin boards that pertain to the bargaining unit. The
Company will transmit this information within two (2) weeks after the action is
taken or, in the case of leave of absence, within one (1) week after the form is
completed. Inadvertent failure to transmit the information or failure of the
Union to receive it shall not invalidate the action involved, since the purpose
of this provision is only to keep the Union informed. Errors shall be corrected
when discovered.

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<PAGE>

65. SHIFT/JOB TRANSFERS. Employees who have completed their probationary period
who desire to change shifts or jobs shall indicate their preference on a form
provided by the Company. When a vacancy occurs in a classification, an employee
performing the same type of work in the classification, with a written
preference form on file, shall be given preference based on their seniority for
transfer where the vacancy exits, subject to the following conditions.

(A) In the event it is not possible to transfer the employee in accordance with
their preference due to there not being an adequately qualified crew on the
shift from which the transfer is to be made, the transfer will be made as
quickly as possible.

(B) The Company shall have the right to train new employees to the
classification on the day shift for a period of not to exceed thirty (30)
working days (except that such period may be extended by agreement of the
parties), and any transfers shall not take place until this training is
completed.

(C) In the event an employee is promoted in a classification, the employee thus
promoted will remain on the same shift and area unless there is a more senior
employee in the classification where the promotion occurs with a preference form
on file. If this should occur the two employees will exchange places.

(D) In the event the Company decides to decrease the number of employees in a
classification on a shift and increase the number of employees in the same
classification on another shift within the same area, the Company will utilize
this Paragraph to achieve the necessary results. If openings exist after all
preferences have been utilized, the least senior employees (being decreased)
will be transferred and shall exercise their seniority rights regardless of
shift or area. All employees (direct or indirect) may utilize their seniority to
bump a less senior employee, and shall not be required to remain within their
classification.

66. Employees granted a preference change under this paragraph to their first
choice shall not be entitled to a preference change for a period of one hundred
twenty (120) days. Employees granted their second choice will continue to have
their first choice on file unless changed by Paragraph 67.

67. Employees may withdraw or change their written preference at any time.
However, the preference form on file before Wednesday of any work week shall
govern any changes to be effective in the following work week and thereafter
unless changed by subsequent preference form. In the event of a reduction or
recall from layoff in the work force in any department or shift, the Company
will notify the Union of these reductions or recalls at which time the
preferences shall be frozen effective midnight the day immediately preceding
such notice. They shall remain frozen until the displacements resulting from
such reductions or recalls are complete.

68. TEMPORARY TRANSFER. Vacancies of 45 days or less in a classification shall
be considered as temporary. The Company may fill such temporary vacancies as
follows. Employees farmed into a classification on any one shift will be
considered one occurrence. The Company shall not exceed 45 occurrences in any
individual classification in a 120 day period. Job vacancies in excess of 45
days may also be considered temporary such as the case where the vacancy is due
to an employee being on leave of absence due to occupational accidents and
certified illness.

69. JOB POSTING. When a vacancy occurs or is expected to occur, (other than a
temporary vacancy), which has not been filled either by promotion, preference
form or recall from layoff, the Company shall, to the greatest degree
practicable, post the job vacancy on bulletin boards

                                       19

<PAGE>

throughout the Company for a period of two (2) working days. Such posting will
include the job title, the location of the job, the pay rate, the shift, and the
job description.

70. Non-probationary employees desiring such job shall apply for the job on a
form prescribed by the Company. The employee selected by the Company (such
selection governed by Par. 48 of this Article) shall be given a trial period of
not less than one working day and not more than twenty (20) working days, which
period may be extended by mutual agreement. If it is determined by the Company
that they are not satisfactorily performing the job, or if employees wash
themselves out pursuant to the terms of Article VI, Par. 50, they shall be
returned to their former classification and the Company shall continue to make
selections by seniority from the bidders and again provide a trial period under
the same procedure. If the next employee is washed out by the Company or washes
out pursuant to the terms of Article VI, Par.50, the Company after exhausting
all bidders may recruit from any available source. Upon bidding the job and
being selected, the employee will not be entitled to bid on another permanent
job opening for a period of six (6) months, except in the event the employee is
not on the job they obtained through bidding due to a decrease in forces as set
forth in Par. 53.

71. An employee may withdraw a bid within one (1) working day after bids have
been closed by giving written notice to Human Resources or their supervisor. An
employee withdrawing a bid in a timely manner and/or an employee who is washed
out by the Company during the trial period shall not be subject to a bidding
bar.

72. An eligible bidder shall be placed on their job within ten (10) working days
after their selection. Such ten (10) day period may be extended by mutual
agreement between the Company and Union.

73. A list of successful bidders shall be posted following the week in which the
selections are made. If posted jobs are not filled, and if the vacancy still
exists, the Company shall re-post the position within thirty (30) days.

74. An employee promoted from the bargaining unit may be returned but once by
the Company to the bargaining unit, provided such option is exercised by the
Company not later than six months after such promotion. Upon their return, the
employee will be credited with the amount of accumulated seniority they had as
of the date of their promotion from the bargaining unit, and shall immediately
resume the accumulation of seniority.

                                   ARTICLE VII
                                MILITARY SERVICE

75. The Company shall accord to each employee who applies for re-employment
after conclusion of military service with the United States such re-employment
rights as they shall be entitled to under then existing statutes. If the
position of such employee has been eliminated, the Company will use every
reasonable effort to provide for the employee employment for which they can
satisfactorily qualify.

                                  ARTICLE VIII
                                LEAVE OF ABSENCE

76. The Company, in cases where production requirements permit or unusual
circumstances warrant, may grant, at its discretion, a leave of absence upon
written request made in the form

                                       20

<PAGE>

prescribed by the Company and upon good cause being shown for such leave for a
definite period of not more than eight (8) weeks. Additional leave may be
granted in writing upon written request where deemed justified, but in any
event, no succession of leaves shall extend beyond one (1) year; provided that
in exceptional cases of extended absence because of illness or accident a longer
leave of absence may be granted at the Company's discretion.

77. Up to three (3) employees at any one time (unless otherwise mutually
agreed), as designated by the Union, may request leave from the Company to serve
as a delegate to a union convention or for other official union business or
training. Whenever possible, the Company will be provided at least thirty days
advance notice of any such leave. Notice given less than 30 days in advance of a
leave will not be unreasonably denied. There shall be no deduction from
"continuous service" (under this Agreement or the Pension Agreement) for leaves
granted under this Paragraph.

78. Any employee (not exceeding three in number at any one time) selected by the
Union to act as a full-time official representative will be given a leave of
absence by the Company for the duration of such office. There shall be no
deduction from "continuous service" (under this Agreement or the Pension
Agreement) for the first twelve (12) months (accumulative) of leave(s) of
absence granted under this paragraph. After the first twelve (12) months of
leave(s) of absence under this paragraph, "continuous service" will be frozen
for the duration of such leave(s).

79. Pregnancy shall be treated the same as any other total or temporary
disability and leave of absence under the terms of this agreement.

80. In the event an employee on leave of absence accepts substitute gainful
employment or self-employment without the prior consent of the Company, their
leave shall automatically be considered cancelled and employment terminated
without recourse, except in the following cases:

(A) As an official representative of the Union, or

(B) In some section of the United States (other than Winnebago County, Illinois,
or Rock County, Wisconsin), where such employee is residing temporarily because
the illness of a member of their immediate family.

81. An employee who is called for jury service shall be excused from work for
the days on which they serve and they shall receive, for each day of such
service on which they otherwise would have worked, the difference between eight
(8) times their classification rate (plus shift premium and supper pay if
applicable) and the payment they receive for jury service. The employee will
present proof of such service and the amount of pay received therefor. An
employee who is subpoenaed for court appearance and is not the plaintiff or
defendant shall be excused from work for the court appearance and shall be paid
for each day lost for which they otherwise would have worked in the same manner
as provided for jury service, above. The employee will present proof of such
appearance and the amount of any pay received therefor.

                                   ARTICLE IX
                            ADJUSTMENT OF GRIEVANCES

82. It is agreed that the Union will establish a Shop Committee from employees
in the bargaining unit to meet with representatives of the Management for the
purpose of presenting and participating in the adjustment of grievances, and,
when established, shall furnish the Company

                                       21

<PAGE>

with the names of the Committee members.

83. Such committee shall consist of three (3) members from the day shift and one
(1) members each from the second and third shifts, provided there are at least
ten (10) or more employees for each committee member on the second and third
shifts. An additional committee member will be added at such time, and for as
long as, the bargaining unit exceeds 200 employees. Thereafter, an additional
committee member will be designated for every 100 employees added to the
bargaining unit.

84. The Company shall recognize alternates appointed to fill a vacancy caused by
the vacation or leave of absence of a committee member, and such alternate shall
be allowed to attend regular monthly union meetings if they so request.

85. At such time as the entire committee is absent from the plant due to Labor
Contract negotiations, two (2) alternate committee members per shift affected
may be appointed by the Union and shall be recognized by the Company.

86. Should any difference or dispute arise between the Company and its
employee(s) concerning the meaning and application of the provisions of this
Agreement, (or should the Union contend that the Company has violated its
obligations under the Agreement to the Union, as such) an earnest effort shall
be made to settle the difference orally. This oral effort shall be made by the
aggrieved employee (or in the case of a breach of obligation to the Union, as
such, by a committee member) and/or not to exceed two committee members at the
option of the employee. If the matter is not resolved orally, it shall be taken
up in the following manner:

87. FIRST: In writing to the supervisor involved. A meeting shall be held within
one (1) working day after receipt of the written grievance. The Company will
normally be represented at this meeting by the supervisors involved, provided
that the Company may designate alternate or additional First Step
Representatives in appropriate cases. The Union will be represented by the
grievant and up to two (2) shop committee members. The written grievance shall
be answered by one of the Company First Step Representative within two (2)
working days after the first step meeting. If the answer is not satisfactory the
grievance shall be appealed to the next step by the Union within four (4)
working days of the written answer.

88. SECOND: Second step meetings will be held within (7) calendar days of the
Union's request unless otherwise mutually agreed. The Company shall make its
written answer within seven (7) working days after the meeting at which the
grievance is discussed. If the answer is not satisfactory, the grievance shall
be appealed to the next step by the Union within ten (10) working days of the
written answer.

89. THIRD: Between an International Representative of the Union, the Local Union
President and/or the two Chairpersons of the Shop Committee and the Managers of
the Company and/or other Company Representatives at a regular or special
meeting. One or more witnesses may be called into the meeting by agreement of
the parties. The Company shall make its written answer within ten (10) working
days after the third step meeting in which the grievance is discussed.

90. FOURTH: If the Union is not satisfied with the third step answer of the
Company, it may, within thirty (30) calendar days of the date of the answer give
notice of its intention to refer the grievance to arbitration. (If the Company
fails to give an answer within the time limit prescribed at Step Three, the
Union may elect to treat the grievance as having been denied and

                                       22

<PAGE>

may give notice of its intent to refer the matter to arbitration.) After such
notice is given, the Company and the Union will attempt to agree upon an
impartial arbitrator. If no agreement is reached within thirty (30) calendar
days thereafter the Federal Mediation and Conciliation Service (FMCS) will
thereafter be asked to submit a panel of seven (7) arbitrators to the parties.
The parties shall, upon receipt of said panel, strike names alternately until
one (1) name remains on the panel; this remaining person shall serve as the
impartial arbitrator. The arbitrator shall have jurisdiction and authority only
to interpret, apply, or determine compliance with the provisions of this
agreement insofar as shall be necessary to the determination of grievances
appealed to the arbitrator. The arbitrator shall not have jurisdiction or
authority to add to, detract from or alter in any way the provisions of this
Agreement.

91. Each party shall assume its own expenses in connection with arbitration, and
the fee of the arbitrator shall be paid by the two (2) parties, one-half (1/2)
by each.

92. Grievances reduced to writing shall be dated and signed by the aggrieved
employee(s) or their Shop Committee Member, except that grievances relating to
more than two (2) employees shall be signed by at least two (2) aggrieved
employees and the Shop Committee Member for the area(s) involved. All answers by
the Company and all appeals by the Union shall be in writing, dated and signed
by the Company or Union representative involved.

93. In the event an employee dies, the Union may process on behalf of their
legal heirs any claim they would have had relating to any monies due under the
provisions of this Agreement.

94. Grievances settled shall be signed off by a Shop Committee Member and/or
International Representative.

95. Written grievances and appeals shall be answered by the Company
Representative or their designee within the time limit fixed therein or the
Union may pass the grievance to the next step, except that in Step 2, if the
Company fails to answer within the time limits fixed therein it shall be
considered adjudicated in favor of the employee. Grievances not appealed within
the specified time limits shall not be eligible for further appeal. All time
limits in this Article may be extended with the written consent of the other
party.

96. Meetings between the International Representative of the Union, the Local
Union President and/or the two Chairpersons of the Shop Committee or their
alternates, and Managers of the Company and/or other Company Representatives
provided for in the third step of the grievance procedure, shall be held at
least once each month, prior to the fifteenth (15th) of the month to consider
all grievance appeals submitted during the preceding month. Special meetings
will be arranged on a date and at a time mutually satisfactory in regard to
difficulties which may arise and which need immediate attention.

97. Members of the Shop Committee will be afforded time off at their
classification rate for the purpose of attending meetings with the Company
pursuant to the first three steps of the grievance procedure. A member of the
Shop Committee shall also be allowed time off when necessary at their
classification rate, to aid in the settlement of grievances in the area which
they represent. A committee member on Union activity shall obtain permission
from their supervisor (which shall not be unreasonably denied) and properly
record their absence prior to leaving their work station to conduct these
activities; shall report their presence and their purpose to the supervisor of
the department in which they wish to conduct this activity; and shall report
their return to their supervisor at the conclusion of this activity. Members of
the Shop Committee shall do their utmost to see that their absence from their
work station due to handling of grievances

                                       23

<PAGE>

shall be as little as practicable and shall do their utmost to see that their
absence from the work station does not interfere with production. Company paid
time under this section is limited to a weekly maximum of the sum of seven (7)
hours times the number of active committee members ("the pool"). All time used
by the committee members will be deducted from the pool. Unused hours will not
be carried over from week to week.

98. All grievances must be presented promptly and not later than thirty (30)
days after the cause of the grievance arises unless the circumstances of the
case made it impossible for the employee or the Union to know that they had
grounds for such claim prior to that date, in which case the retroactivity shall
not exceed thirty (30) days prior to the date the grievance was filed in
writing. Grievances involving discharge must be presented within three (3)
working days of the action (subject to Par. 102). Grievances alleging improper
layoff must be presented within two (2) working days of the Company notice to
the employee of this intended layoff or there shall be no retroactivity prior to
the date of the grievance.

99. Grievances alleging improper recall must be presented within two (2) working
days after notice is given to the employee (at the address last given by them to
the Human Resources Department) that a less senior employee was recalled to a
job classification to which they were entitled, or there shall be no
retroactivity prior to the date of the grievance. In cases of retroactivity the
employee will be paid at the rate of the job classification to which they were
entitled.

100. The Grievance Committee of the Union shall be notified and given a list of
all employees scheduled for layoff or recall prior to such layoff or recall
taking place. The layoff list proposed by the Company shall not become final
until one working day after the Union has been provided with the list.

101. The assignment of Shop Committee Members to their respective plant areas
shall be a matter of full knowledge to both the Union and the Company
immediately. It is further agreed, for the purpose of prompt settlement of
grievances, that, where necessary, committee members will handle grievances
without restriction as to area.

102. Under the provisions of this Agreement, no employee, after their
probationary period provided in Par. 63 of Article VI, Seniority, shall be
discharged or given a disciplinary layoff in excess of five (5) days, without
first being suspended. Such initial suspension shall be for not more than five
(5) working days. During this period of initial suspension, the employee may, if
they believe that they have been unjustly dealt with, request a hearing and a
statement of the offense before their supervisor or their superintendent or the
Human Resources Department Representative, with a Grievance Committee member or
the plant committee present if they so desire. At such hearing, the facts
concerning the case shall be made available to both parties. After such hearing
or if no such hearing is requested, the management may conclude whether the
suspension shall be converted into discharge or disciplinary layoff, or
dependent upon the facts of the case, whether such suspension shall be extended,
or revoked, or modified or affirmed. If the suspension is revoked, the employee
shall be returned to employment and made whole in the absence of mutual
agreement to the contrary; but in the event a disposition shall result in the
affirmation, extension or modification of the suspension, or in the discharge of
the employee, the employee may within three (3) working days after such
disposition allege a grievance in writing on a regular grievance form which
shall be handled in accordance with the procedure outlined in this Article,
beginning with Step Two. Should any employee as a result of this grievance, have
their discipline or discharge revoked, they shall be returned to work and made
whole. In the event of arbitration the arbitrator shall determine what, if any,
substitute earnings or compensation are

                                       24

<PAGE>

to be offset.

103. Where discipline of an employee is involved or there is a dispute as to the
correctness of an employee's record of absence/tardiness, an employee or (with
the employee's permission) their Shop Committee Member may review their record
of absence/tardiness in the presence of a supervisor.

                                    ARTICLE X
                                 BULLETIN BOARDS

104. The Company agrees to provide up to two (2) glassed in bulletin boards with
locks to be placed at the South Beloit plant which may be used exclusively by
the Union for posting notices signed by the Union Secretary or the President of
the Local Union and restricted to:

     1.   Notices of Union recreational and social affairs.

     2.   Notices of Union appointments and results of Union elections.

     3.   Notices of Union meetings.

     4.   Notices of Union elections.

     5.   Notices, which shall be non-controversial in nature, approved by
          Company Representatives.

105. It is agreed that the Company may remove any notice which is not in
accordance with the above restrictions.

                                   ARTICLE XI
                                      WAGES

106. New and/or changed jobs shall be described and classified in accordance
with the National Position Evaluation Program, which may be modified as
necessary by mutual agreement. The new or changed description and classification
shall then be submitted to the job evaluation committee and, if agreed to, shall
then be established. If no agreement is reached, the Company may place the
description and classification in effect, after which a grievance may be filed
at any time within the next thirty (30) days, contending that the job has been
improperly described and/or classified.

107. Job evaluation points assigned to a job classification shall be changed
only when it has been established that there have been changes in the job
content or by mutual agreement.

108. The standard hourly wage schedule of rates for the respective job classes
set forth in Appendix "A" shall become effective and shall remain in full force
and effect for the duration of this Agreement. A schedule of jobs in each job
class is also included in Appendix "A." Appendix "A" constitutes the minimum
rates of pay for the applicable job classification (direct and indirect as
applicable) and are incorporated by reference and are fully made a part of this
Agreement.

109. Employees hired on or after May 17, 2006 for all job classifications, shall
serve a progression period where applicable, or will enter at the starting wage
rate set forth in Appendix "A". Progression increases may be subject to
demonstration of required skills on milestone dates. Bidding into a higher
classification will result in applicable new hire rate.

                                       25

<PAGE>

110. Effective on or after August 6, 2006, employees hired prior to May 17, 2006
bumping into a lower classification will result in applicable Incumbent rate.
Bidding into a higher classification will enter at the 6 month progression rate
for new classification set forth in Appendix "A".

111. It is understood and agreed that nothing contained in this Article shall
prevent the Company from paying a present employee or a new employee the rate of
the job classification to which they are transferred or assigned, provided they
are qualified and able to perform the work satisfactorily.

112. When a reduction of employees occurs in a classification or in the Company,
an employee who has attained a classification above the lowest grade in an
occupational group (see Appendix B) shall not be reduced in rate as long as they
are retained at work within that occupational group. Such rate retention shall
also apply in the event such an employee is recalled to the occupational group
from a job classification outside of the occupational group or from layoff out
of the plant.

113. An employee wishing to be reduced in classification within an occupational
group may exercise this right but once and only in the event there is a posted
opening.

114. When an employee is transferred to a classification outside their
occupational group in lieu of layoff, they shall receive the rate of the
classification to which they are assigned.

115. Indirect. When an indirect employee is temporarily assigned to another
indirect job classification outside their own occupational group, they shall be
paid on the basis of either the indirect rate of their regular job
classification or the indirect rate of the classification to which they are
assigned, whichever is greater. When an indirect employee is temporarily
assigned to a direct job classification outside their own occupational group,
they shall be paid the higher of the rate of their regular job classification or
the rate of the job classification to which they are assigned.

Direct. When a direct employee is temporarily assigned to another direct job
classification outside their own occupational group, they shall be paid the
higher of the direct rate of their regular job classification or the direct rate
of the job classification to which they are assigned. An employee who is
classified in a direct labor classification and who is temporarily transferred
to an indirect labor classification, other than pursuant to Article VI, shall be
paid either the rate of their regular classification or the rate of the
classification to which they are assigned, whichever is greater.

Employees hired on or after January 28, 1984, who are working under the new hire
rate progression, will be paid the appropriate rate provided for in this
paragraph when temporarily transferred, reduced to the applicable rate based
upon their time in the new hire rate progression.

116. No employee shall be temporarily transferred to another classification
outside their occupational group (unless they consent) if there is an employee
from another occupational group working in the group and shift and in the
Operation to which they are regularly assigned; provided that this limitation
shall not apply when an employee has been temporarily transferred out of the
occupational group because of disability or their own request.

117. It is agreed that a shift differential shall be paid to an employee
regularly assigned to other than the day shift as follows: an employee who works
four or more hours after 3:00 p.m.

                                       26

<PAGE>

and before 11:00 p.m. shall receive a differential of fifty-five (.55) cents per
hour for each hour worked; an employee who works four or more hours after 11:00
p.m. and before 7:00 a.m. shall receive a differential of sixty-five (.65) cents
per hour for each hour worked. An employee regularly assigned to the first shift
shall not receive a shift differential for overtime work. No change in method of
shift differential pay will be made for an employee temporarily transferred from
one shift to another for a period not exceeding one day. If such transfer
exceeds one day, the shift differential shall be, or shall not be, paid in
accordance with the provisions of this Paragraph relating to the shift on which
they are temporarily working.

118. Saturday and Sunday shall be as defined in Article IV, Par. 24.

119. In the event the work of a job classification as set forth in Appendix "A"
is discontinued or becomes inoperative, the Union will be immediately notified
of the reason thereof. Such notification does not preclude the filing of a
grievance should any disagreement arise between the parties.

120. Pay Adjustments and Corrections. Where a "retro" adjustment involves a
deduction from the employee's pay, no more than $50 will be deducted from any
one check. In the case of gross errors the $50 maximum will not apply and other
arrangements will be made.

                                   ARTICLE XII
                                 COST-OF-LIVING

121. For the term of this contract, the cost-of-living provisions will be
frozen.

122. (A) Except as set forth below in sub-paragraph (C)(3) and (4), all
cost-of-living adjustments provided in this Article shall be accumulated in a
cost-of-living float which shall be an "add-on," and shall not be part of an
employee's classification rate. Such adjustments shall be payable only for clock
hours actually worked and for reporting allowances and shall be included in the
calculation of overtime premium, but, except as provided below, shall not be
part of the employee's pay for any other purpose and shall not be used in
calculation of any other pay, allowance, or benefit. Cost-of-living adjustments
will be included in the calculation of holiday pay as defined in paragraph 31 of
this Agreement. Vacation pay in any year will be calculated from the prior
year's earnings as stated on the Wage and Tax Statement (Form W2) in accordance
with paragraph 37 of the Agreement.

123. (B) The United States Department of Labor, Bureau of Labor Statistics,
Consumer Price Index for Urban Wage Earners and Clerical Workers - C.P.I. - W
U.S. City Average: All items 1982-84 = 100 shall be used as the basis for
cost-of-living adjustments provided for in sections (C), (D) and (E) below. Such
index shall be referred to as the "BLS-CPI."

124. (C) (1) During the calendar year 1999, there shall be four (4)
cost-of-living adjustment dates: February 1, 1999, May 1, 1999, August 1, 1999,
and November 1, 1999.

(2) The cost-of-living adjustment added to the cost-of-living float on such date
(if a Monday) or on the first Monday following such 1999 adjustment dates, if
any, will be an adjustment of one cent ($.01) for each full four-tenths (.4)
points movement in the BLS-CPI index figures (after the six cent [$.06] "set
off" or "corridor" set forth in [C] [3] below) based upon the following
calculation months for the following 1999 adjustment dates:

February 1, 1999 - Subtract September, 1998 index figure from the December, 1998
index figure.

May 1, 1999 - Subtract December, 1998 index figure from the March, 1999 index
figure.

                                       27

<PAGE>

August 1, 1999 - Subtract the March, 1999 index figure from the June, 1999 index
figure.

November 1, 1999 - Subtract the June, 1999 index figure from the September, 1999
index figure.

If the calculation for any quarterly adjustment when dividing four-tenths (.4)
into the applicable BLS-CPI index change between calculation month indexes
results in tenths of the index left over, such tenths will be carried over into
the BLS-CPI index change between the calculation month indexes for the next
quarterly adjustment.

(3) The first six cents ($.06) which the above formula would otherwise generate
for 1999 cost-of-living adjustments on the 1999 adjustment dates will not be
paid in any form. No 1999 cost-of-living adjustments will be added to the
cost-of-living float until the first six cents ($.06) which the application of
the formula would produce has been exceeded and then only the amount generated
in excess of six cents ($.06) shall be added to the cost-of-living float.

125. (D) (1) During the calendar year 2000, there shall be four (4)
cost-of-living adjustment dates: February 1, 2000, May 1,2000, August 1, 2000,
and November 1, 2000.

(2) The cost-of-living adjustment added to the cost-of-living float on such date
(if a Monday) or on the first Monday following such 2000 adjustment dates, if
any, will be an adjustment of one cent ($.01) for each full four-tenths (.4)
points movement in the BLS-CPI index figures (after the six cent ($.06) "set
off" or "corridor" set forth in (D) (3) below based upon the following
calculation months for the following 2000 adjustment dates:

February 1, 2000 - Subtract the September, 1999 index figure from the December,
1999 index figure.

May 1, 2000 - Subtract the December, 1999 index figure from the March, 2000
index figure.

August 1, 2000 - Subtract the March, 2000 index figure from the June, 2000 index
figure.

November 1, 2000 - Subtract the June, 2000 index figure from the September, 2000
index figure.

If the calculation for any quarterly adjustment when dividing four-tenths (.4)
into the applicable BLS-CPI index change between calculation month indexes
results in tenths of the index left over, such tenths will be carried over into
the BLS-CPI index change between the calculation month indexes for the next
quarterly adjustment.

(3) The first six cents ($.06) which the above formula would otherwise generate
for 2000 cost-of-living adjustments on the 2000 adjustment dates will not be
paid in any form. No 2000 cost-of-living adjustments will be added to the
cost-of-living float until the first six cents ($.06) which the application of
the formula would produce has been exceeded and then only the amount generated
in excess of six cents ($.06) shall be added to the cost-of-living float.

126. (E) (1) During the calendar year 2001, there shall be four (4)
cost-of-living adjustment dates: February 1, 2001, May 1, 2001, August 1, 2001,
and November 1, 2001.

(2) The cost-of-living adjustment added to the cost-of-living float on such date
(if a Monday) or on the first Monday following such 2001 adjustment dates, if
any, will be an adjustment of one cent ($.01) for each full four-tenths (.4)
points movement in the BLS-CPI index figures (after the three cent ($.03) "set
off" or "corridor" set forth in (E) (3) below) based upon the following
calculation months for the following 2001 adjustment dates:

February 1, 2001 - Subtract September, 2000 index figure from the December, 2000
index figure.

May 1, 2001 - Subtract December, 2000 index figure from the March, 2001 index
figure.

August 1, 2001 - Subtract the March, 2001 index figure from the June, 2001 index
figure.

November 1, 2001 - Subtract the June, 2001 index figure from the September, 2001
index figure.

If the calculation for any quarterly adjustment when dividing four-tenths (.4)
into the applicable BLS-CPI index change between the calculation month indexes
results in tenths of the index left over, such tenths will be carried over into
the BLS-CPI index change between the calculation month indexes for the next
quarterly adjustment.

                                       28

<PAGE>

(3) The first three cents ($.03) which the above formula would otherwise
generate for 2001 cost-of-living adjustments on the 2001 adjustment dates will
not be paid in any form. No 2001 cost-of-living adjustments will be added to the
cost-of-living float until the first three cents ($.03) which the application of
the formula would produce has been exceeded and then only the amount generated
in excess of three cents ($.03) shall be added to the cost-of-living float.

127. (F) In no event will a reduction of the BLS-CPI and the application of the
formulas set forth in Subsection (C), (D) and (E) provide the basis for a
reduction of an employee's base rate and such reduction shall reduce the
cost-of-living "add on" only to the extent of the amount accumulated in the
cost-of-living float for the quarter or quarters involved.

128. (G) No adjustments, retroactive or otherwise, shall be made due to any
revision which may later be made in the published BLS-CPI index for any month or
months specified in Subsections (C), (D) and (E) above.

129. (H) Should the BLS-CPI, in its present form and on the same basis
(including composition of the "Market Basket" and Consumer Sample) as the last
index published prior to January 1, 1999 become unavailable, the parties shall
attempt to adjust this Article or, if agreement is not reached, request the
Bureau of Labor Statistics to provide the appropriate conversion or adjustment
which shall be applicable thereafter. The purpose of such conversion shall be to
produce as nearly as possible the same result as would have been achieved using
the BLS-CPI in its present form.

130. (I) In the event the Bureau of Labor Statistics does not issue the Consumer
Price Index on or before the beginning of the pay periods referred to above, any
adjustments required will be made at the beginning of the first pay period after
receipt of the Index.

                                  ARTICLE XIII
                                SAFETY AND HEALTH

131. The Company and the Union will cooperate in the objective of eliminating
accidents and health hazards. The Company shall continue to make reasonable
provisions for the safety and health of its employees at the plants during the
hours of their employment. The Company, the Union and the employees recognize
their obligations and/or rights under existing federal and state laws with
respect to safety and health matters.

132. Protective devices and safety apparel necessary to properly protect
employees from injuries shall be provided by the Company. Complaints concerning
inadequate heating and/or ventilation will be given prompt and due
consideration.

133. The Company will request a physical examination of each and every new
employee hired before they report for work. They may from time to time request a
physical examination of employees now on the payroll of the Company. It is
expressly understood and agreed that any physical examination of employees on
the payroll shall be made at the Company's expense and shall not be done for the
express purpose of separating the employee from the payroll of the Company.

134. Employees injured at work who, upon direction of the Company approved
medical provider or facility, are unable to complete their shift shall be paid
at their classification rate for the difference between the hours actually
worked on that day and

                                       29

<PAGE>

1) On Monday through Friday, the hours they were actually scheduled to work that
day, but not more than eleven; or

(2) On Saturday, Sunday or holiday if the injury took place during the first
four (4) hours of work, four (4) hours at the applicable premium rate of pay;
or, if the injury took place after four (4) hours of work, the number of hours
for which they were scheduled (not in excess of eight) at the applicable premium
rate of pay.

Nothing herein is intended to prevent employees from seeing a doctor of their
own choice, but if they do so on the day of the injury payment under this clause
shall require the concurrence of the Company.

135. A Safety Committee consisting of three employees designated by the Union
and at least two management members designated by the Company shall be
established to cover the plant. The Safety Committee shall hold monthly meetings
at times determined by the Committee. The Committee may engage in periodic
safety tours of the items agendaed as part of its regular safety meetings. Time
spent in committee meetings and official committee plant tours shall be
considered hours worked to be compensated by the Company. The function of the
Safety Committee shall be to advise the plant management concerning safety and
health and to discuss legitimate safety and health matters but not to handle
grievances. In the discharge of its function, the Safety Committee shall:
consider existing practices and rules relating to safety and health, formulate
suggested changes in existing practices and rules, recommend adoption of new
practices and rules, review proposed safety and health programs developed by
management and review accident severity and frequency statistics. All accidents
involving fatalities or serious disabling injuries, or such other serious
situations as merit investigation, such as fires, explosions, or like
catastrophes shall be agendaed to the Safety Committee for consideration. Upon
request, the Union Safety Committee will be given access on a confidential basis
to reports or studies that directly relate to safety hazards, health or
dangerous conditions that exist in the plant (e.g., air sampling and noise
monitoring). A Union Safety Committee Member upon notice to the Management
Safety Council shall be given affordable time to present issues pertaining to
safety, at the Management Safety Council meeting.

136. The Union Chairperson or a designee shall be notified immediately when a
serious accident has occurred. By the tenth of each month the Company will
provide the Union a list of all employees who were sent from work to the
physician for treatment during the prior month for work related (or claimed work
related) injuries claimed at work during that month.

137. The Union Chairperson or a designee will be afforded time off from their
job as may be required to visit departments at all reasonable times for the
purpose of transacting the legitimate business of the Committee, after notice to
the supervisor of the department to be visited and the permission (which shall
not be withheld) from their own supervisor. The Company will pay up to four (4)
hours/week toward the time spent in such activity.

138. New rules and regulations applicable to safety and health will be posed and
discussed with the Safety Committee with the objective of increasing employee
cooperation.

139. Recommendations of the Safety Committee shall be submitted to the
appropriate Manager for their consideration and for such action that they may
consider consistent with the Company's responsibility to provide for the safety
and health of its employees during the hours of their employment and the mutual
objective set forth in Par. 130.

                                       30

<PAGE>

140. Grievances involving safety matters shall first be raised orally between
the grieving employee and their supervisor as provided in the grievance
procedure. If the grievance is not satisfactorily resolved, the employee may
immediately (within two (2) working days) file in writing in the second step
under such procedure.

                                   ARTICLE XIV
                             INSURANCE AND PENSIONS

141. Any benefits payable under said provisions will be coordinated so that the
total Benefits Payable under all such group plans will not exceed 100% of the
charges for such services.

142. The term "employer group or prepayment plan" is defined as any group plan
for which any employer makes contributions or for which any employer provides a
means of collecting contributions required by employees (including payroll
deduction).

143. The Pension Agreement, separately executed, shall remain in effect for the
term of this Agreement.

                                   ARTICLE XV
                               SEVERANCE ALLOWANCE

144. When in the sole judgment of the Company it decides to permanently
discontinue the operation of a plant or a substantial section of a plant and
finds it necessary to terminate the employment of employees as a result thereof,
any employee whose employment is terminated either directly or indirectly as a
result thereof and who is not entitled or indirectly as a result thereof and who
is not entitled to other employment with the Company under the provisions of
Article VI of this Agreement or Par. 146 below will be entitled to a severance
allowance in accordance with and subject to the provisions of this Article.

145. Eligibility. To be eligible for a severance allowance an employee must have
accumulated one or more years of seniority at the time of termination, as
computed in accordance with Article VI of this Agreement.

146. As an exception to Par. 145 above, however, any employee otherwise eligible
for a severance allowance who is offered a job within the bargaining unit under
the provisions of Article VI of this Agreement will not be entitled to severance
allowances whether they accept or reject the job offer. If such a transfer
results directly in the permanent termination of some other employee, that
employee will then be eligible for a severance allowance, subject to all of the
other provisions of this Article.

147. In lieu of severance allowance, the Company may offer an eligible employee
a job outside the bargaining unit. The employee will have the option of either
accepting the job offered or receiving severance allowance.

148. Scale of Allowance - An eligible employee will receive a severance
allowance based on his seniority at the time of termination as follows:

<TABLE>
<CAPTION>
                                   Weeks of
Seniority as of Date              Severance
of Termination                    Allowance
--------------------              ---------
<S>                               <C>
1 year but less than 2 years        2 weeks
</TABLE>

                                       31

<PAGE>

<TABLE>
<S>                               <C>
2 years but less than 5 years       4 weeks
5 years but less than 10 years      6 weeks
10 years but less than 20 years     8 weeks
20 years or more                   12 weeks
</TABLE>

149. Calculation of Allowance - A week of severance allowance will be calculated
in accordance with the provisions for calculating a week of paid vacation as set
forth in Article V of the Agreement.

150. Payment of Severance Allowance - Payment of any severance allowance for
which an employee may be eligible will be made in a lump sum at the time of
termination.

151. Notwithstanding any other provisions of this Article, any employee who is
eligible for a severance allowance under the provisions of this Article, may, at
the time of termination, elect to be placed on layoff status for a period of one
(1) year, rather than to be terminated and receive severance allowance. At the
end of such period, such an employee may elect to remain on layoff status or to
be terminated and receive the severance allowance to which they are entitled. If
such an employee elects to remain on layoff at the expiration of such period,
they will forfeit their right to the severance allowance to which they would
otherwise be eligible.

152. An employee who voluntarily terminated their employment with the Company
before they are terminated by the Company will not be entitled to a severance
allowance.

153. Nonduplication of Allowance. Severance allowance shall not be duplicated
for the same severance, whether the other obligation arises by reason of
contract, law, or otherwise. If an individual is or shall become entitled to any
discharge, liquidation, severance or dismissal allowance or payment of similar
kind by reason of any law of the United States of America or any of the states,
districts, or territories thereof subject to its jurisdiction, the total amount
of such payments shall be deducted from the severance allowance to which the
individual may be entitled under this Article, or any payment made by the
Company under this Article may be offset against such payments. Statutory
unemployment compensation payments shall be excluded from the nonduplication
provisions of this Section, except that the severance allowance will be
allocated by the Company to the equivalent number of weeks immediately following
termination.

                                   ARTICLE XVI
                        TERMINATION, EXPIRATION AND SCOPE

154. The terms and conditions of the Agreement shall continue in full force and
effect until 12:01 a.m. February 1, 2009, and shall continue in full force and
effect indefinitely thereafter, provided, however, that either party may
terminate this Agreement at any time on or after February 1, 2009 by giving to
the other party at least sixty days prior written notice by certified mail of
its election to terminate. In the event the Company shall desire such
termination of the Agreement, such notice shall be sent by certified mail to the
District Office of the United Steelworkers, 1126 South 70th Street, Suite S106A,
West Allis, WI 53214 and a copy shall be sent to the offices of Local Union 3245
at 1620 Shore Drive, Beloit, Wisconsin, 53511. In the event the Union shall
desire such termination of the Agreement, notice of such desire shall be sent by
the Union by certified mail to the offices of the Company, 449 Gardner Street,
South Beloit, IL 61080. Either party may by written notice change the address to
which certified mail notice to it shall be given.

                                       32

<PAGE>

                                  ARTICLE XVII
                               COMPLIANCE WITH LAW

155. It is understood and agreed that if any of the terms and provisions of this
Agreement are, or become in violation of any State or Federal laws, they are
null and void so long as they may be in violation, and it is further agreed that
the parties hereto shall immediately meet for the purpose of resolving any term
or provisions so indicated.

                                       33

<PAGE>

UNITED STEELWORKERS                     WARNER ELECTRIC, LLC.

-------------------------------------   ----------------------------------------
Leo W. Gerard                           Stan Owens
President United Steelworkers           Operation's Manager

-------------------------------------   ----------------------------------------
James D. English                        Charles Evans
Secretary-Treasurer                     Human Resources Manager

-------------------------------------   ----------------------------------------
Thomas Conway                           Gary Simpler
Vice President (Administration)         Legal Counsel

-------------------------------------   ----------------------------------------
Fred Redmond                            Tim McGowan
Vice President (Human Affairs)          Vice President
                                        Human Resources

-------------------------------------
Jon Geenen                              ----------------------------------------
Director District 2                     Judy Crandall
                                        Human Resource
                                        Representative
-------------------------------------
Bill Breihan
Staff Representative

-------------------------------------
Steve Reynolds
President, Local 3245

-------------------------------------
Robert Caples
Committeeperson

-------------------------------------
Gary Gillett
Committeeperson

-------------------------------------
James Elliott
Committeeperson

-------------------------------------
Jada Hammond
Committeeperson

-------------------------------------
Phil Sholes
Committeeperson

                                       34

<PAGE>

September 19, 1986

MR. LAWRENCE DUNCAN
STAFF REPRESENTATIVE

United Steelworkers of America
Beloit, Wisconsin 53511

Dear Mr. Duncan:

Our policy is to utilize our own employees to the maximum practical extent in
production and maintenance work. At the same time, it is recognized that
problems of skill, equipment, time, economy, and know-how may render it
necessary or expedient to subcontract. Whenever the Union feels that
subcontracting involves work which could be done economically and within the
prescribed time limits by bargaining unit employees, the Company will discuss
and explain the matter upon request to the Union. It is further agreed that the
Company will notify the Union in writing prior to subcontractors coming into the
plant to perform such work or such work being sent out, or contracts to perform
such work being signed by management. This letter is not merely meant to
constitute a notification procedure but it is intended to, where possible,
provide sufficient advance notice so as to allow the Union to, upon request,
discuss the decision.

Sincerely,

--------------------------------------
Donald F. Sorensen
Manager - Employee Relations
Warner Electric Brake & Clutch Company

                                       35

<PAGE>

Pension

For employees who retire or otherwise become eligible on or after January 30,
2005 the following formulas apply:

     Formula to be used for benefits received effective January 30, 2005: $31.00
     multiplied by years of accrued service.

For purposes of pension accrual years of continuous service will be frozen July
3, 2006. Employees who reach 30 years of service and who are at least 57 years
of age, will be eligible to receive a lump sum payment based on frozen pension
accrued .

                                       36

<PAGE>

                                  APPENDIX "A"

<TABLE>
<CAPTION>
       ASSEMBLER A (DIRECT LABOR)          8/6/06   1/28/07   1/27/08
       --------------------------          ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              14.20    14.48     14.77
Starting Wage Rate                          13.20    13.48     13.77
Wage Progression (3 months post hire)       13.45    13.73     14.02
Wage Progression (6 months post hire)       13.70    13.98     14.27
Wage Progression (9 months post hire)       13.95    14.23     14.52
Wage Progression (12 months post hire)      14.20    14.48     14.77
</TABLE>

<TABLE>
<CAPTION>
       ASSEMBLER B (DIRECT LABOR)          8/6/06   1/28/07   1/27/08
       --------------------------          ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              13.51    13.78     14.06
Starting Wage Rate                          10.50    10.71     10.92
Wage Progression (3 months post hire)       10.75    10.97     11.19
Wage Progression (6 months post hire)       11.00    11.22     11.44
Wage Progression (9 months post hire)       11.25    11.48     11.71
Wage Progression (12 months post hire)      11.50    11.73     11.96
</TABLE>

<TABLE>
<CAPTION>
        MACHINIST (DIRECT LABOR)           8/6/06   1/28/07   1/27/08
        ------------------------           ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              16.84    17.01     17.18
Starting Wage Rate                          14.00    14.28     14.57
Wage Progression (3 months post hire)       14.55    14.84     15.14
Wage Progression (6 months post hire)       15.10    15.40     15.71
Wage Progression (9 months post hire)       15.65    15.96     16.28
Wage Progression (12 months post hire)      16.20    16.52     16.85
</TABLE>

<TABLE>
<CAPTION>
     SHOP COORDINATOR (DIRECT LABOR)       8/6/06   1/28/07   1/27/08
     -------------------------------       ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              17.30    17.47     17.64
Starting Wage Rate                          14.50    14.79     15.09
Wage Progression (3 months post hire)       15.03    15.33     15.64
Wage Progression (6 months post hire)       15.56    15.87     16.19
Wage Progression (9 months post hire)       16.09    16.41     16.74
Wage Progression (12 months post hire)      16.62    16.95     17.29
</TABLE>

<TABLE>
<CAPTION>
    MATERIAL HANDLER (INDIRECT LABOR)      8/6/06   1/28/07   1/27/08
    ---------------------------------      ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              12.80    13.06     13.32
Starting Wage Rate                          10.50    10.71     10.92
Wage Progression (3 months post hire)       10.75    10.97     11.19
Wage Progression (6 months post hire)       11.00    11.22     11.44
Wage Progression (9 months post hire)       11.25    11.48     11.71
Wage Progression (12 months post hire)      11.50    11.73     11.96
</TABLE>

                                       37

<PAGE>

<TABLE>
<CAPTION>
       INSPECTOR (INDIRECT LABOR)          8/6/06   1/28/07   1/27/08
       --------------------------          ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              15.54    15.70    15.86
Starting Wage Rate                          13.00    13.26    13.53
Wage Progression (3 months post hire)       13.55    13.82    14.10
Wage Progression (6 months post hire)       14.10    14.38    14.67
Wage Progression (9 months post hire)       14.65    14.94    15.24
Wage Progression (12 months post hire)      15.20    15.50    15.81
</TABLE>

<TABLE>
<CAPTION>
      TRUCK DRIVER (INDIRECT LABOR)        8/6/06   1/28/07   1/27/08
      -----------------------------        ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              15.19    15.34    15.49
Starting Wage Rate                          14.00    14.28    14.57
</TABLE>

<TABLE>
<CAPTION>
  TRUCK DRIVER DIESEL (INDIRECT LABOR)     8/6/06   1/28/07   1/27/08
  ------------------------------------     ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              15.72    15.88    16.04
Starting Wage Rate                          14.25    14.54    14.83
</TABLE>

<TABLE>
<CAPTION>
    TOOL & DIE MAKER (INDIRECT LABOR)      8/6/06   1/28/07   1/27/08
    ---------------------------------      ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              18.69    18.69    18.88
Starting Wage Rate                          17.62    17.97    18.33
</TABLE>

<TABLE>
<CAPTION>
SENIOR TOOL & DIE MAKER (INDIRECT LABOR)   8/6/06   1/28/07   1/27/08
----------------------------------------   ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              19.07    19.07    19.26
Starting Wage Rate                          17.62    17.97    18.33
</TABLE>

<TABLE>
<CAPTION>
    MASTER MECHANIC (INDIRECT LABOR)       8/6/06   1/28/07   1/27/08
    --------------------------------       ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              18.45    18.45    18.63
Starting Wage Rate                          17.39    17.74    18.09
</TABLE>

<TABLE>
<CAPTION>
 SENIOR MASTER MECHANIC (INDIRECT LABOR)   8/6/06   1/28/07   1/27/08
 ---------------------------------------   ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              18.89    18.89    19.08
Starting Wage Rate                          17.39    17.74    18.09
</TABLE>

<TABLE>
<CAPTION>
      ELECTRICIAN (INDIRECT LABOR)         8/6/06   1/28/07   1/27/08
      ----------------------------         ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              19.48    19.48    19.67
Starting Wage Rate                          18.36    18.73    19.10
</TABLE>

<TABLE>
<CAPTION>
   SENIOR ELECTRICIAN (INDIRECT LABOR)     8/6/06   1/28/07   1/27/08
   -----------------------------------     ------   -------   -------
<S>                                        <C>      <C>       <C>
Incumbent Rate                              19.88    19.88    20.08
Starting Wage Rate                          18.36    18.73    19.10
</TABLE>

                                       38
<PAGE>

                                  APPENDIX "B"
                             (RATE RETENTION GROUPS)

1.   Material Handler

2.   Assembler A, Assembler B

3.   Machinist

4.   Shop Coordinator

5.   Inspector

6.   Truck Driver

7.   Truck Driver Diesel

8.   Senior Tool & Die, Tool & Die

9.   Senior Master Mechanic, Master Mechanic

10.  Senior Electrician, Electrician

                                  APPENDIX "C"
                         OVERTIME DISTRIBUTION AGREEMENT

1. Supervisors shall be responsible for the equilization of overtime and for
maintaining and the daily posting of overtime distribution records; each group
showing the names of the employees in the group and the overtime hours worked
and/or declined by each employee, total overtime hours charged, and the
employee's shift and overtime group to which assigned. Overtime hours charged
but not worked will be identified with a circle around the hours charged.

2. Overtime within each overtime group shall be maintained within the thirty
straight time hour spread, regardless of shift.

3. Only overtime that is offered to an employee on or before his shift prior to
the shift on which the overtime is to be worked will be charged to an employee
who declines the offered overtime. It is agreed that in the event an employee is
scheduled to work overtime for any of the reasons spelled out below, they shall
be charged. There is no intent to allow anyone to arbitrarily schedule an
employee to work overtime just for the sake of charging them to bring their
overtime in line without working anyone. For the purpose of charging overtime,
it is understood that, the overtime period begins at the time the employee
completes a normal work day (8 hours).

4. No employee shall be discriminated against or disciplined for their inability
to work overtime, except that an employee shall be required to work overtime if
they have agreed to do so, or if they have been notified to work overtime at
least forty (40) hours ahead of time and have not been excused.

5. Overtime hours worked or declined by the employee shall be charged on the
basis of straight time for each hour.

6. When an employee new to the Company has passed sixty days of their
probationary period, they shall be charged with the average overtime hours in
the overtime group to which they are assigned. The new employee will not work
overtime hours prior to their 60th day unless all employees in their overtime
group are assigned to work overtime, or unless all other available employees in
their overtime group have been asked to work.

                                       39

<PAGE>

7. When an employee is transferred (other than temporary transfers) they shall
be charged with the average of the overtime group to which they are assigned on
the first day of their transfer.

8. When an employee in an overtime group is absent for any reason, they shall be
charged for the overtime hours that they could have worked had they been
available.

9. When the Company attempts, but is unable to contact any employee not on
Company premises, the employee shall not be charged with the overtime hours
which the Company was attempting to offer them.

10. The Company may schedule employees to continue work during overtime hours
which they were performing during straight-time hours even though this may
create a temporary imbalance of overtime opportunities within the limitations
specified in Paragraph 2 above.

11. When an overtime group is exhausted the Company will use an employee from
that same occupational group provided there is not an experienced employee
currently in the area.

12. If an overtime group is not exhausted, and an employee from another overtime
group performs overtime work in that overtime group (except as is provided in
Paragraph 34, Article IV) the Company shall reimburse the low employee in the
overtime group for the actual overtime hours they would otherwise have worked,
at the appropriate overtime premium rate. It is recognized that time to time an
employee scheduled for overtime may fail to report as scheduled, and the Company
may assign an employee from another overtime group if necessary, or an employee
from the proper overtime group, whichever is practicable, without incurring any
violation of these overtime distribution provisions, until such time as with
reasonable diligence a proper employee from the proper overtime group can be
assigned. For purposes of this Appendix, the availability of an employee in an
overtime group shall be considered exhausted if all hours of overtime
opportunity are offered to the employees within the overtime group in a
twenty-four (24) hour period in accordance with the provisions of Article III
and Article IV of this Agreement.

13. If the Company bypasses the lowest available employee in the overtime group
(and the overtime hours of such employee are lower than the permissible spread
at the time the overtime begins), the Company shall be liable to reimburse such
employee at the appropriate overtime premium rate for the actual overtime hours
they otherwise would have worked. Employees who receive reimbursement without
working shall be charged with the appropriate number of hours on the overtime
list.

14. The overtime distribution total shall continue from year to year without a
cutoff date being applicable. In other words, if an employee is behind on their
overtime opportunities for the previous contract year, they shall have first
opportunity for overtime hours in the succeeding year. The overtime totals shall
be carried over at the end of each contract year in the same manner as they are
carried over from month to month during the contract year.

15. For purposes of overtime distribution only, a vacation taken in weekly
increments will be considered to start on Friday after the completion of the
employee's shift and finishing at the start of the employee's shift on Monday
following the week or the multiple of weeks vacation. In the case of a day or
day's vacation immediately before a weekend, the weekend shall be considered as
part of the employee's vacation with work commencing on their regular shift on
Monday. If

                                       40

<PAGE>

the employee elects to take a day or day's vacation starting Monday, the
vacation will be considered as having started on the previous Friday at the end
of the employee's shift. In the case of single day's vacation taken on Friday or
Monday, an employee may at their option, if asked, work weekend overtime.

16. In scheduling weekend overtime the following procedure shall apply:

     (A)  The supervisor involved will, in accordance with normal practice,
          determine how many, and which employees are required for Friday,
          Saturday, and Sunday overtime.

          Should the supervisor determine to ask an employee who would be "on
          vacation" (which, in accordance with this paragraph 15 of the Overtime
          Distribution Agreement, begins at the end of their shift on Friday)
          the employee will be charged for overtime if asked. If the employee's
          entire overtime group has been scheduled, the employee will be
          considered "asked."

     (B)  The Company may, either by asking the employee as an individual or by
          scheduling their entire overtime group, offer an employee overtime
          work on the Friday or Saturday or Sunday which begins their vacation.
          No disciplinary action will be taken if the employee refuses this
          overtime unless they have accepted the overtime assignment and fail to
          report.

When the Company schedules or asks an entire overtime group for a week or more
at a time all employees in that overtime group will be charged for all hours
scheduled or asked unless the employees overtime is cancelled by a supervisor.
When an employee is on leave of absence or vacation they will be charged for
overtime hours worked if one employee above the employee on leave of absence or
vacation and all the employees below are asked to work.

     (C)  With the exception of the Friday or Saturday or Sunday which begins as
          employee's vacation, an employee on vacation will not be eligible for
          overtime assignments during their vacation, but will however be
          charged for overtime in accordance with Paragraph 8 of the Overtime
          Distribution Agreement.

17. If an employee has a physical limitation, known to the supervisor, due to a
dermatitis condition, back or weight limitation, or legal restriction, etc., so
that they are precluded from these tasks during straight time hours, they will
not be permitted to work at these tasks on overtime hours. However, they shall
be charged for all overtime hours that would have been available to them,
provided that another employee actually performs the work. Such limitation shall
be noted on the overtime record.

18. The Company shall make every attempt to notify employees of overtime as soon
as possible.

                                       41

<PAGE>

                                  APPENDIX "D"
                                 OVERTIME GROUPS

Group #1  - Material Handler
Group #2  - Assembler A
Group #3  - Assembler B
Group #4  - Machinist
Group #5  - Shop Coordinator
Group #6  - Inspector
Group #7  - Truck Driver
Group #8  - Truck Driver Diesel
Group #9  - Senior Tool & Die, Tool & Die
Group #10 - Senior Master Mechanic, Master Mechanic
Group #11 - Senior Electrician, Electrician

                             LETTER OF UNDERSTANDING
Any overtime groups agreed to, are subject to change as new cells are developed.

                                       42

<PAGE>

                                ENROLLMENT DATES

Group Health Insurance

The participant can re-enroll on January 1st of each year. The participants
cannot make a change in plan coverage unless there is a qualifying event such as
marriage, birth, etc. Changes such as adding a dependent, dropping a dependent
may be made at any time during the year.

Option Life

Participants may enroll or increase their coverage once a year during the first
two calendar weeks of December. They may stop at any time with 30 days advanced
notice.

401(k)

Initial enrollments, changes in the amount of contribution, investment
elections, and investment transfers can be done at any time. Contributions may
be stopped at any time. Participants may reenroll the first day of the following
month after they stop deductions.

                                 401(K) PROGRAM
            EFFECTIVE JULY 1, 2006, COMPANY MATCHES 50% UP TO 6% (FOR
                         TOTAL OF 3% OF ELIGIBLE WAGES)

<TABLE>
<CAPTION>
Employee Contribution    Employer Contribution            Total
---------------------   ----------------------   ----------------------
<S>                     <C>                      <C>
 1% of eligible wages   0.5% of eligible wages   1.5% of eligible wages
          2%                     1.0%                     3.0%
          3%                     1.5%                     4.5%
          4%                     2.0%                     6.0%
          5%                     2.5%                     7.5%
          6%                     3.0%                     9.0%
</TABLE>

                             APPENDIX "E" INSURANCE
                              SCHEDULE OF BENEFITS

<TABLE>
<CAPTION>
               FOR YOU                             FOR YOUR DEPENDENTS
               -------                             -------------------
<S>                                     <C>
Life insurance:                         Life insurance: Spouse $4,000 Each
$35,000 effective 1/30/05               dependent child $2,000

Additional life and AD&D:               Additional spouse and dependent life
In $1,000 increments combined maximum   insurance: Spouse $10,000/dependent
coverage $55,000 through payroll        $4,000 available through payroll
deduction.                              deduction.

Sickness & Accident:                    Not applicable.
67% of base pay up to a maximum of
$380 per week effective 8/1/2006.
</TABLE>

Life insurance and accidental death and dismemberment insurance benefits are
both occupational and non-occupational. All other benefits are non-occupational.

No benefits for A.D. & D. shall be payable for any loss resulting from taking
poison, asphyxiation, or inhalation of gas, self-destruction, acts attributable
to war and other causes

                                       43

<PAGE>

specified in the policy; or, when the date of accidental bodily injury is more
than one hundred twenty days from the date the loss is sustained.

Accident and sickness benefits begin on the first day of accident, first day of
hospitalization or outpatient surgery, and eighth day of sickness, and continue
for a maximum of twenty-six weeks during any one period of disability. Worker's
Compensation to be supplemented by Accident and Sickness Benefit including a
payment at the per diem Sickness and Accident level (1/5th of the Sickness and
Accident Weekly Benefit Amount) for the Worker's compensation waiting period
(not including the day of the accident which is covered by Paragraph 133 of the
Collective Bargaining Agreement). Such supplement for the waiting period may be
by direct payment or insured with the Sickness and Accident carrier and if the
waiting period is subsequently paid by any other insurance, by any governmental
agency or from any other source, the Company shall be entitled to reimbursement
from the employee by payroll deduction, set off from future Worker's
compensation payments from the Worker's Compensation insurance carrier or any
other reasonable method of recoupment, other than recoup from a private policy
carried by the individual employee where he or she is paying the full premium.

The individual certificate will define a continuous disability or confinement.

"Dependents" include only, your spouse and unmarried children from the date of
live birth until nineteen years, stepchildren and legally adopted children are
eligible dependents; but parents or other relatives are not eligible for
dependent coverage even though supported by you. Children after attainment of
age nineteen while incapable of self support because of a disabling sickness or
injury that commenced prior to age nineteen are covered provided such child was
eligible for coverage as a dependent prior to age nineteen. Such children must
otherwise meet the definition of dependent children, must legally reside with
you, and must be principally supported by you. Children until age twenty seven
are eligible dependents if they are full-time students at an accredited school
provided they are unmarried and otherwise a dependent.

Eligibility - A regular employee actively at work will be eligible immediately.
Future new regular employees will become eligible on the first day of the month
after hire.

Employees and dependents who retire between the ages of 57 and 65 shall have
their coverage continued (except for regular life insurance, A.D. & D., and
weekly sickness and accident benefits) until such time as they are qualified for
Medicare or Medicaid or in the case of children until they no longer qualify
because of age, disability, marriage, etc.

                                       44

<PAGE>

                               INSURANCE AGREEMENT

THIS AGREEMENT is made and entered into this 17th day of May 2006 by and between
WARNER ELECTRIC, LLC or its successors or assigns (hereinafter referred to as
the "Company") and the UNITED STEELWORKERS (hereinafter referred to as the
"Union") on behalf of itself and LOCAL UNION NO. 3245.

Definitions

1. Wherever used herein:

     (a)  "Employee" means an individual in the bargaining unit who has
          completed their first 60 days (except for health care);

     (b)  "Program" means the program of insurance benefits established by this
          Agreement;

Program of Insurance Benefits

2. The Program shall be applicable to Employees while this Agreement is in
effect in accordance with the provisions of this Agreement, subject to the
following provisions:

     (a)  Employees not actively at work on May 17, 2006 shall not be eligible
          to participate under the Program until they return to active work on
          or May 17, 2006 provided, however, that any Employee who shall return
          to work and who shall subsequently become eligible for benefits due to
          a recurrence of a disability or claim which commenced prior to May 17,
          2006, will be eligible for benefits at the applicable rates of
          benefits provided for under the Program, but only for the balance of
          the period for which he would have been entitled to benefits under the
          Prior Program.

     (b)  The amounts of life insurance after retirement provided for under the
          Program shall be applicable in accordance with the Benefit
          Continuation Clause for Early Retirement Window Plan.

                                       45

<PAGE>

Medical & Dental Plan

3. (a) Effective August 1, 2006, a comprehensive Preferred Provider Organization
(PPO) medical, offering both in and out of network benefits, will become
effective for all employees. A summary of the plan benefits is outlined below:

                                ALTRA BASIC PLAN
                              SCHEDULE OF BENEFITS

<TABLE>
<CAPTION>
BENEFIT                                   IN-NETWORK               OUT-OF-NETWORK
-------                                   ----------               --------------
<S>                             <C>                             <C>
Annual Deductible               $500/$1,000                     $1,000/$3,000
Coinsurance                     80%/20%                         60%/40%
Out of Pocket Maximum           $2,000/$4,000                   $4,000/$8,000
Lifetime Maximum                Unlimited                       Unlimited

OFFICE VISIT COPAYMENTS
Primary Care Physician          $15 per visit                   N/A
Specialist                      $30 per visit                   N/A

INPATIENT HOSPITAL SERVICES
Inpatient Care                  20% after deductible            40% after deductible
Surgery & Anesthesia            20% after deductible            40% after deductible
Physicians Services             20% after deductible            40% after deductible
X-ray & Lab Services            20% after deductible            40% after deductible

OUTPATIENT SERVICES
Outpatient Surgery              20% after deductible            40% after deductible

MATERNITY SERVICES
Hospital Services               20% after deductible            40% after deductible
Prenatal-Postpartum             Office Visit Copay $15 or $30   40% after deductible

MENTAL HEALTH/SUBSTANCE ABUSE
Inpatient                       20% after deductible            40% after deductible
                                As many days as medically
                                necessary.
Outpatient                      Office Visit Copay $15 or $30   40% after deductible

EMERGENCY ROOM                  $50 Copay                       40% after deductible
                                *(waived if admitted)

MEDICAL SERVICES
Office Visits                   Office Visit Copay $15 or $30   40% after deductible
Gynecological Visits            Office Visit Copay $15 or $30   40% after deductible
Specialist Visit                Office Visit Copay $15 or $30   40% after deductible
Well Child (Immunizations)      Office Visit Copay $15 or $30   40% after deductible
Annual Physical                 Office Visit Copay $15 or $30   40% after deductible
X-ray & Lab                     20% after deductible            40% after deductible
Allergy Tests & Treatment       Office Visit Copay $15 or $30   40% after deductible

PRESCRIPTION DRUG
Generic                                   $10 Copay
</TABLE>

                                       46

<PAGE>

<TABLE>
<S>                             <C>                             <C>
Brand                                     $25 Copay
Non-Formulary                             $40 Copay
Mail Order                       90-day supply, $20, $50, $80
Retail                                  Not Available

VISION CARE
Eye Exam                                   $60 - per plan year, no network
Eyewear                                     $100 allowance per plan year

OTHER SERVICES
Skilled Nursing Facility        20% after deductible            40% after deductible
Home Health Care                20% after deductible            40% after deductible
Durable Medical Equipment       No Copay, no deductible         40% after deductible
Chiropractic Services, $500     Office Visit Copay $15 or $30   40% after deductible
Maximum
</TABLE>

                        Weekly Medical Plan Contribution

<TABLE>
<CAPTION>
                        8/6/2006   1/28/2007   1/27/2008   1/4/2009
                        --------   ---------   ---------   --------
<S>                     <C>        <C>         <C>         <C>
Single                   $20.35      $28.81      $34.00     $ 40.12
Employee& Spouse         $38.06      $53.90      $63.60     $ 75.04
Employee & Child(ren)    $36.39      $51.53      $60.81     $ 71.76
Family                   $53.07      $75.15      $88.67     $104.63
</TABLE>

On an annual basis, if an additional plan is made available to non-bargaining
unit employees, this plan will be made available to bargaining unit employees
subject to bargaining with the union.

Contributions will be set at the lesser of 30% of the actual premium or a
guaranteed maximum as stated in the medical and dental charts.

Year 2006 deductibles will be prorated to 5/12 of the plan's requirement ($208
per person/$416 per family for in-network care).

                                       47

<PAGE>

Dental Plan

Dental benefits are provided based on the schedule below:

<TABLE>
<S>                             <C>
Annual Deductible:              $25/$75
Benefit Type:
Preventive ($0 Ded.)            100%
Basic                           80%*
Major                           50%*
Orthodontic Benefit ($0 Ded.)   50%*
Maximum Annual Benefit          $1,000 per person
Orthodontic Lifetime
Maximum                         $1,500 per person
</TABLE>

*    DeltaPreferred and DeltaPremier dentists will accept Delta Dental's
     payment, plus any required employee coinsurance and any applicable
     deductible as payment in full. These dentists will file your claims for
     you. If you go to a non-network dentist, payment will be made directly to
     you unless you assign benefits to the dentist. Delta Dental will pay the
     lower of usual, reasonable, and customary as determined by the Plan of the
     state in which services are rendered or the fee the dentist bills for
     covered services. You will be responsible for paying the difference between
     the non-participating dentist's charge and Delta Dental's payment.

                         Weekly Dental Plan Contribution

<TABLE>
<CAPTION>
         1/1/2006   1/1/2007   1/1/2008   1/1/2009
         --------   --------   --------   --------
<S>      <C>        <C>        <C>        <C>
Single     $1.76      $2.00      $2.00      $2.00
Couple     $3.01      $3.39      $3.39      $3.39
Family     $5.15      $5.80      $5.80      $5.80
</TABLE>

Hearing aids and the associated examination will be self-funded at 50/50 to a
maximum Company payment of $2,500 every three (3) years. Eligible dependents are
covered.

     (a)  Employees with life insurance and AD & D coverage shall have the
          right, at their option, to increase both coverages equally through
          payroll deduction, at their own expense, in $1,000 increments, at
          $.44/month per $1000, up to a maximum of $55,000 life insurance
          coverage and $55,000 AD & D coverage. Coverage shall be on a monthly
          basis. Employees may initiate, increase, or decrease such additional
          coverages during the first two (2) weeks of December and may terminate
          at any time upon thirty (30) days written notice.

     (b)  The dental program shall not be subject to the insurance continuation
          provisions of Section 11 of this Agreement, nor shall this program be
          provided for future retirees.

     (c)  Employees with dependent life insurance coverage shall have the right,
          at their option, to increase the coverage through payroll deduction,
          at their own expense at the rates listed below. The additional $10,000
          spouse/$4,000 dependent insurance coverage shall be paid on a monthly
          basis through payroll deduction.

                                       48

<PAGE>

          Employees may initiate, increase, or decrease such additional
          coverages during the first two (2) weeks of December and may terminate
          at any time upon thirty (30) days written notice.

<TABLE>
<CAPTION>
                  Cost
Age of         Per Family
Employee        Per Month
--------       ----------
<S>            <C>
Less than 30     $ 1.50
Age 30-34        $ 1.60
Age 35-39        $ 1.90
Age 40-44        $ 2.60
Age 45-49        $ 3.80
Age 50-54        $ 5.60
Age 55-59        $ 8.40
Age 60-64        $12.20
Age 65-69        $18.70
</TABLE>

Cost of Benefits

4. The cost of the benefits under the Program shall be paid by the Company,
except as provided below in this Paragraph 4 and 7 hereof:

     (a)  Any employee on layoff who elects to continue basic life insurance
          after the last month of layoff for which such life insurance is
          continued without contribution by him will be required to pay $.44 per
          month (or the applicable group premium rate at the time of the layoff)
          per $1,000 of basic life insurance for each month as to which he is
          eligible in order to continue such insurance.

     (b)  The amounts required to be paid for benefits provided under law in
          excess of basic Program benefits shall be paid entirely by the
          Employees.

Participation by Employees

5. Each employee shall be a participant in the Program and the amount, if any,
which he shall be required to contribute to the cost thereof shall be deducted
by the Company from his pay. Each Employee shall furnish to the Company any such
written authorization or assignment (in a form agreed to by the Company and the
Union) as shall be necessary to authorize the deduction from his pay of the
amount of any contributions.

     Changing selection during plan year is possible only if you have a change
in your family situation. This would include:

-    The birth or adoption of a child.

-    Marriage or divorce.

-    Death of your spouse or other dependent.

-    Significant change in employee or spousal health coverage attributable to
     the spouse's employment.

-    Employee or spousal employment status change.

                                       49

<PAGE>

Other major changes may be considered, depending on the circumstances.

Requirements of Law

6. It is intended that the provisions for the insurance benefits which shall be
included in the Program shall comply with and be in substitution for the
provisions for similar benefits which are or shall be made by any applicable law
or laws. Where, by agreement, certain basic benefits under the Program are
provided under law rather than under the Program, the Company will pay the
amount required to be paid therefor, including any employee contribution
required by law on account of such benefits. The Company shall, after
consultation with the Union, reduce the benefits of the Program to the extent
that benefits provided under any law would otherwise duplicate any of the
Program benefits.

     Effective January 30, 2005, active and retired employees and their
dependents, who are 65 years or older and who are entitled to Medicare, will not
be reimbursed for the Part B monthly premium, if they are paying such premium
under the Medicare Program. In addition, the Company will not reimburse the
monthly Part B premium for disability retirees retiring on or after January 30,
2005 if they are paying such premium under the Medicare program.

Additional and Alternate Benefits

7. The Program shall be in substitution for any and all insurance benefits or
payments to or on behalf of Employees for death, sickness or accident,
hospitalization, medical or surgical service provided by the Company in whole or
in part, except as the Company and the Union have agreed or may agree in
writing.

Administration of the Program

8. The Program shall be administered by the Company or through arrangements
provided by it. Except as may otherwise be provided in this Agreement, the
Company will arrange to have the hospitalization and physicians' services
benefits under the Program provided through contracts with carriers selected by
the Company, which contracts, respectively, shall be consistent with this
Agreement and shall provide benefits in the amounts listed in Appendix E.
Sickness and accident benefits and life insurance shall be provided by such
method and through such carriers, if any, as the Company in its sole discretion
shall determine.

     All benefits except life insurance, accidental death and dismemberment and
weekly income benefits shall be paid directly to the provider of the service for
which benefits are payable.

Administration of Sickness and Accident Benefits

9. The payment of sickness and accident benefits is an obligation of the
Company, but the Agreement with the Union permits the Company to provide the
payment through a policy with an insurance company. The Company performs
important administrative functions in connection with the handling of claims,
including the issuance of benefit checks. In the typical case, such handling is
routine and a claim is paid within two weeks after it is received by the
Company. The Company is authorized to make benefit payments on claims without
prior approval of the insurance company when Company personnel engaged in claims
work determine the claim meets

                                       50

<PAGE>

the standards established by the insurance company for Company approval. If you
have a claim which does not meet these standards it is referred to the insurance
company for decision and you are notified of such action within two weeks after
the claim is received by the Company. In reaching its decision, the insurance
company may take reasonable steps to investigate the medical and other factual
aspects of the claim.

Life Insurance for Disability Retirees

10. An employee who shall retire on or after January 30, 2005 under the
disability provisions of the Company Pension Plan at or after age 57 and prior
to age 62 will have his life insurance (in the full amount set forth in Appendix
E) continued until age 62 at which time it will be reduced to $5,000.00

     An employee who shall retire under the disability provisions of the Company
Pension Plan prior to age 57 will receive in equal monthly installments over a
five year period the full face value of his life insurance benefit then in
effect. If death occurs before the full face value has been paid, his
beneficiary will be paid the difference between said full face value and the
amount already paid.

     At the time an employee in any of the above categories leaves the
employment of the Company, Accidental Death & Dismemberment coverage will cease.

          BENEFIT CONTINUATION CLAUSE FOR EARLY RETIREMENT WINDOW PLAN

     The Company and the Union have agreed to an early retirement window plan
which shall be available to designated employees who notify the Company of their
election to retire by August 1, 2006 and retire before December 31, 2006.

     Employees who retire in accordance with the above-described early
retirement window plan ("early retirees"), and employees who have retired
between December 1, 2004 and May 5, 2006, shall be eligible for continued
coverage under the Company's medical and retiree life insurance plans until they
reach age 65.

     Early retirees who elect continued coverage shall make the same
contributions and receive the same medical benefits as active employees. Early
retirees shall be eligible for single, couple or family coverage, subject to the
applicable contribution. Contributions to the cost of insurance shall be made by
the retiree by sending in a monthly check to the Company by the 1st of each
month.

     Early retirees between the ages of 57 and 65, who elect single, couple or
family coverage under the medical plan, shall have their medical coverage
continued until such a time they are qualified for Medicare or Medicaid or in
the case of children until they no longer qualify because of age, disability,
marriage, etc.

     Early retirees shall be subject to the same plan terms and rules as active
employees, including but not limited to dates for changing coverage,
contributions, exclusions, co-pays, deductibles, benefits, limits on benefits,
etc. Such terms and rules may be amended, subject only to the Company's duty to
negotiate with the Union over changes in benefits affecting active employees. If
any amendments are made to the terms affecting active employees, early retirees

                                       51

<PAGE>

will be subject to the same amendments as active employees. In the event
coverage for active employees is terminated, coverage for early retirees shall
also be terminated.

     For purposes of COBRA coverage, retirement shall be treated as a qualifying
event and the maximum period for COBRA coverage shall be measured from the date
of retirement.

     This clause shall survive expiration of the collective bargaining
agreement. This clause shall be binding on the Company and its successors.

                              RETIREMENT OPTION 1.
                           SPECIAL RETIREMENT PROGRAM

     -    Employees age 57+ with 30 years of service as of December 31, 2006

               -    Must elect to retire by August 1, 2006

               -    Still eligible for $2,000 ratification payment

               -    Retiree healthcare benefits remain intact. Retiree
                    healthcare available at applicable (currently 25%, 30%
                    effective 1/1/2007) active employee contribution rate, OR a
                    one-time $13,000 cash payment in lieu of healthcare
                    benefits.

               -    Lump sum pension payment option is available.

     -    Retiree healthcare assurance letter provided.

     -    Warner Electric management will determine last day worked, which will
          be prior to 12/31/2006 or a later date by mutual agreement.

                              RETIREMENT OPTION 2.
                            EARLY RETIREMENT PROGRAM

     -    Employees age 57+ with 5 years of service as of December 31, 2006

               -    Must elect to retire by August 1, 2006

               -    Still eligible for $2,000 ratification payment

               -    $13,000 cash payment

               -    Retiree healthcare and retiree life insurance is no longer
                    available

               -    Plan does not allow a lump sum pension payment for employees
                    with less than 30 years of service.

     -    Warner Electric management will determine last day worked, which will
          be prior to 12/31/2006 or a later date by mutual agreement.

Extension of Benefits

11. If an employee shall be absent from the service of the Company for a period
not to exceed thirty (30) months, due to non-occupational disability (validated
by doctor's certificate) the insurance program shall be kept in effect for such
employees during such thirty (30) month's period only. In cases of absence due
to occupational disability, the insurance program shall be kept in effect for up
to five (5) years.

                                       52

<PAGE>

     In cases of layoff of employees with less than two (2) years of seniority,
the group insurance program shall cease on the last day worked except that such
employee shall have the conversion privileges provided for in the master
insurance policy. In cases of layoff of employees with two (2) or more years of
seniority, sickness and accident benefit coverage will cease on the last day
worked; life insurance, hospitalization benefits, and surgical benefits shall be
kept in effect for two (2) months after the end of the month in which the
employee last worked; life insurance may be continued thereafter for a period of
an additional twelve (12) months by paying the required premiums in advance to
the Company in the amount specified in Paragraph 4 (a) above.

     In cases where an active employee dies with five (5) but less than ten (10)
years of seniority with dependent coverage in effect at the time of death, the
dependent coverage (hospital, surgical, medical, dental and drug only) will be
continued for the dependents during the month of death and the following six
months assuming continued payment of the monthly premium contribution provided
for in the group insurance program. This extension shall be the month of death
and the twelve following months in the case of an active employee who dies with
ten (10) or more years of seniority and with dependent coverage in effect at the
time of death.

Extent of Company Obligation

12. The failure of any carrier to provide for benefits under the Program shall
not result in any liability to the Company, nor shall such failure be considered
a breach by the Company of any of the obligations which it has undertaken by
this or any other agreement with the Union. In the event of any such failure,
the Company and the Union shall immediately take action to provide substitute
coverage in accordance with the provisions of this Agreement. Differences
between claimants and the insurance carrier or their agents shall not be subject
to the grievance procedure provided in the Basic Agreement. In the event of a
disputed claim the Company will assist in communicating with the insurance
carrier to assure compliance with the Master Insurance Contract.

Insurance Reports

13. The Union shall be furnished, upon request, an annual report regarding the
Program. From time to time during the term of this Agreement, the Union shall be
furnished such additional information as shall be reasonably required for the
purpose of enabling it to be properly informed concerning the operation of the
Program. Any accounting under the Program shall make no distinction between the
experience with respect to Employees and other employees who may be covered,
except that experience of employees who participate in the Program on a
different basis or are entitled to different benefits from those provided for
employees represented by the Union shall be included in such accounting only to
the extent that the Company and the Union agree to such inclusion. The Company
will continue the present arrangements under which it undertakes the keeping of
insurance records of individual employees, the completion of individual
employees' certificates, the recording of changes in insurance classifications
and a major portion of the investigation and payment of claim. The cost to the
Company of performing such work will not, for any accounting under the Program,
be deemed to be a cost of the Program.

                             Job Security Agreement

     -    South Beloit manufacturing operations will remain open for the life of
          the collective bargaining agreement (through January 31, 2009),
          subject to paragraph 3 of the Job Security Agreement.

                                       53

<PAGE>

     -    In the event that any bargaining unit employee of the active payroll
          as of the date of ratification of this collective bargaining agreement
          is laid off without expectation of recall during the term of the
          collective bargaining agreement, he/she will have the right to elect
          severance pay at two times the rate provided in the collective
          bargaining agreement. Election of severance pay will terminate the
          employee's seniority rights.

     -    This agreement will become null and void in the event the plant is
          closed due to an Act of God, or in the event the plant fails to
          perform at least a 5% EBITDA level for two (2) consecutive quarters.

                                TERM OF AGREEMENT

The Insurance Agreement dated May 17, 2006 shall remain in effect through
February 1, 2009. This Agreement shall become effective as of May 17, 2006 and
shall remain in effect until February 1, 2009 in accordance with the Basic
Agreement.

                                       54<PAGE>
                                                                               .
                                                                               .
                                                                               .

                                                                    EXHIBIT 10.9

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                <C>
ARTICLE 1 - AGREEMENT                                              P. 6
1.1   Dates and Names
1.2   Preamble

ARTICLE 2 - RECOGNITION                                            P. 6
2.1   Explained

ARTICLE 3 - MANAGEMENT PREROGATIVES                                P. 6
3.1   Explained

ARTICLE 4 - NO STRIKE-NO LOCKOUT                                   P. 6 - P. 7
4.1   Explained
4.2   Arbitrator power

ARTICLE 5 - UNION SHOP                                             P. 7
5.1   Explained
5.2   Indemnification

ARTICLE 6 - CHECK-OFF                                              P. 7 - P. 9
6.1   Authorization
6.2   Initial Deduction
6.3   Wage Period
6.4   Remittance
6.5   Authorization Cards
6.6   Collecting More Than One Month
6.7   Liability
6.8   Check-Off Wording
6.9   Retiree Check-off Opportunity

ARTICLE 7 - SENIORITY                                              P. 9 - P. 15
7.1   Job Classifications
7.2   "Cell" Defined
7.3   "Cell Operator -Primary" Defined
7.4   "Cell Operator - Secondary" Defined
7.5   "Cell Operator-Support" Defined
7.6   Seniority of Cell Operators
7.7   Filling of Posted Cell Vacancies
7.8   Rates for Cell Operators
7.9   Overtime Equalization of Cell Operators
7.10  Work Force Reduction & Layoff
7.11  Readjustment of the Work Force
7.12  Reassignment to a Previous Classification
7.13  Prohibition on Bumping into Higher Base Rate Job
7.14  Relinquishing Seniority in Prior Classification
      When Recalled
7.15  Only Low Seniority Employees Should Be Laid Off
7.16  Recall in Reverse Order of Layoff
7.17  Temporary Assignments
7.18  Rates Paid For Temporary Assignments
7.19  Necessity For Temporary Shift Changes
7.20  Shift Preference Rules
7.21  Cross Training; Seniority List
7.22  Probationary Employees
7.23  Temporary or Vacation Replacements
7.24  When Employee Becomes "Seniority Employee"
7.25  Trainees for Excluded Positions
7.26  Temporary Excluded Positions (Temporary Supervisors)
7.27  Transfers or Promotions to an Excluded Status
7.28  Excluded Personnel Doing Bargaining Unit Work
7.29  Seniority Date
7.30  Loss of Seniority Provisions
7.31  Temporary Layoffs Not to Exceed Four Working Days
</TABLE>

                                       1

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<S>                                                                <C>
ARTICLE 8 - HOURS AND PREMIUM PAY                                  P. 15 - P. 17
8.1   Forty Hour Week and Allowable Exceptions
8.2   Overtime Pay Rules
8.3   Voluntary Overtime
8.4   Weekend Work and Absenteeism
8.5   Overtime Equalization Statement
8.6   Notice to Cancel Already Scheduled Overtime
8.7   Notice to Employees for Saturday or Sunday Overtime
8.8   Union Representation on Overtime
8.9   Overtime Equalization Rules
8.10  Reporting and Call-In Pay

ARTICLE 9 - BIDDING                                                P. 17 - P. 18
9.1   General Bidding and Posting Requirements
9.2   Hiring From Outside
9.3   Prohibition on Bidding After Giving Up a Bid
9.4   Probation Period After Bid
9.5   Medical Restricted Employee Returning to Classification
      After Temporary Assignment
9.6   Posting for Qualified Persons
9.7   Training Schedule
9.8   Effective Dates of Wage Rate Changes

ARTICLE 10 - REPRESENTATION                                        P. 18 - P. 19
10.1  Bargaining Committee
10.2  No Individual Bargaining
10.3  Shift Stewards
10.4  Chief Committeeman
10.5  Compensation During Working Hours
10.6  Union Representatives and Seniority List
10.7  Listing of Union Officers
10.8  Leaving to Go To Local 155 Office
10.9  Furnishing of Contracts
10.10 Union Officers Entrance Into Premises
10.11 Union Leave of Absence

ARTICLE 11 - GRIEVANCE PROCEDURE                                   P. 19 - P. 22
11.1  Definition of "Grievance"
11.2  Writing a Signed Grievance
11.3  Discussion With Supervisor Required
11.4  First Level
11.5  Second Level
11.6  Third Level
11.7  Fourth Level (Arbitration)
11.8  Time Limits and Extension of Time Limits
11.9  Disciplinary Action
11.10 Arbitration Rules
11.11 Time Limit for Retroactivity
11.12 Notice of Discharges and Disciplinary Layoffs
11.13 Grievance Meetings
11.14 Employees in Grievance Meetings.

ARTICLE 12 - SUBCONTRACTING                                        P. 22
12.1  Explained

ARTICLE 13 - NEW CLASSIFICATIONS                                   P. 22 - P. 23
13.1  New Jobs
13.2  New Classification and Rate
13.3  Grievance and Arbitrators Power
</TABLE>

                                       2

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<S>                                                                <C>
ARTICLE 14 - GENERAL                                               P. 23 - P. 24
14.1  Tools of the Trade
14.2  Inventory
14.3  Rates of Pay and Benefits Are Fixed
14.4  No Further Bargaining Required
14.5  When Employees Are Paid
14.6  Short Term Loan When On S&A
14.7  Employee Responsibility to Maintain Address and
      Phone Number
14.8  Option to Be Paid By Automatic Deposit
14.9  Responsibility to Share Knowledge
14.10 Improving Productivity and Related Goals
14.11 Recording of Employment Status
14.12 Change of Address; Company Reliance on Last Address
14.13 Unclaimed Wages
14.14 Union Bulletin Board
14.15 Work Rule Changes

ARTICLE 15 - EQUAL EMPLOYMENT OPPORTUNITY                          P. 24 - P. 27
15.1 Explained

ARTICLE 16 - VACATION
16.1  Qualifying Vacation Year
16.2  Seniority Definition for Vacation Year
16.3  Formula for Computing Lump Sum Vacation Pay
16.4  Paying Vacation Pay to a Retiree
16.5  Quarterly Payout Option
16.6  Formula for Determining Unpaid Vacation Time Off
16.7  Maximum Vacation Time Off Provided Full Entitlement
      is Earned
16.8  Extra Five Day Unpaid Vacation Block
16.9  Scheduling Vacation Time Off and Advance Preference
16.10 Timetable for Announcing Vacation Shutdown
16.11 Timetable for Submitting Vacation Time-Off Requests

ARTICLE 17 - HOLIDAYS                                              P. 27 - P. 32
17.1  Holiday Schedule
17.2  Holiday Pay
17.3  Holiday Eligibility Regulations Which Apply Only to
      Holidays Other Than Christmas Period
17.4  Holiday Eligibility Regulations Which Apply Only to
      the Christmas Holiday Period
17.5  Christmas Holiday Period - Miscellaneous
17.6  Holiday Eligibility Regulations Which Apply to Both
      the Christmas Holiday Period and Other Holidays
17.7  Special Christmas Holiday Procedures - Days of Work
      Scheduled by December 10th.

ARTICLE 18 - BEREAVEMENT PAY                                       P. 32
18.1  Explanation of Coverage
18.2  Death Occurring During Vacation
18.3  Straight Time Rate Used
18.4  Stillborn Birth
18.5  Delaying Excused Absence Dates
18.6  Death While Employee on Leave

ARTICLE 19 - PAY FOR JURY DUTY                                     P. 32 - P. 33
19.1  Explanation of Coverage
19.2  Subpoenaed Witness Rules
19.3  Rules for Shift Workers

ARTICLE 20 - SHORT-TERM MILITARY DUTY PAY & RE-EMPLOYMENT          P. 33
20.1  Explanation of Coverage
20.2  Notice to Company and Statement of Military Pay
20.3  Re-Employment Rights

ARTICLE 21 - PERSONAL LEAVE OF ABSENCE                             P. 33 - P. 34
21.1  Explanation
</TABLE>

                                       3

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<S>                                                                <C>
ARTICLE 22 - MEDICAL LEAVE OF ABSENCE                              P. 34
22.1  Explanation
22.2  Substantiation Required
22.3  Disability Plan

ARTICLE 23 - ON THE JOB INJURY                                     P. 34
23.1  Transportation on Day of Injury
23.2  Doctor Determination on Day of Injury
23.3  Compensation During Working Time
23.4  Re-visits
23.5  Discussion of Workers Compensation Claims and
      Union Representative
23.6  Lost Time When Scheduled on Holiday or Weekend

ARTICLE 24 - SAFETY AND HEALTH                                     P. 34 - P. 35
24.1 Requirement to Meet Laws
24.2 Safety Committee Members
24.3 Pay While Meeting on Safety Committee
24.4 OSHA Log
24.5 Reporting an Unsafe Condition
24.6 Grievance Procedure
24.7 Protective Equipment
24.8 Hazardous Communication Program
24.9 Protective Gloves

ARTICLE 25 - INSURANCE                                             P. 36 - P. 39
25.1  Medical Insurance Options and Rates
25.2  Schedule of Benefits
25.3  Opt Out Bonus
25.4  Dental Insurance Options and Rates
25.5  Retiree Health Insurance and VEBA, and
      Retiree Dental Insurance
25.6  Disability - S&A and LTD Plans
25.7  Continuation of Insurance Benefits While Laid Off or
      On Disability
25.8  Life Insurance and AD&D  Schedule of Benefits
25.9  Optional Dependent Life Insurance
25.10 Employee Eligibility for Insurances
25.11 Dependent Eligibility for Insurances
25.12 Status Changes - Requirement to Notify Company
25.13 Beneficiary - Requirement to Keep Up To Date
25.14 Summary Plan Descriptions
25.15 Flexible Spending Accounts

ARTICLE 26 - 401(K) PLAN                                           P. 39 - P. 40
26.1  Continuation for Life of Agreement
26.2  Special 401(k) Contribution for Pension Participants
26.3  Ongoing Participation in 401(k) Plan for Pensioners
26.4  New Hire Eligibility and Contributions

ARTICLE 27 - PENSION                                               P. 40
27.1  Continuation With Modifications
27.2  Basic Benefit and When Frozen
27.3  Early Retirement Supplement
27.4  Interim Supplement
27.5  Medicare Benefit
27.8  Survivor Pension Benefit Option
27.9  Temporary Benefit Supplement - Eliminated

ARTICLE 28 - WAGES                                                 P. 40 - P. 41
28.1  Explained Each Year of Contract
28.2  COLA - Eliminated
28.3  Rate Schedule Effective Date and Classifications

ARTICLE 29 - TRANSFER OF AGREEMENT                                 P. 41
29.1  Explanation
</TABLE>

                                        4

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<S>                                                                <C>
ARTICLE 30 - SEPARABILITY CLAUSE                                   P. 41
30.1  Explanation

ARTICLE 31 - TERMINATION                                           P. 41 - P. 42
31.1  Dates
31.2  Sixty Day Notice Requirement
31.3  Agreement Replaces Previous Agreements
31.4  Signature Page

LETTER NO. 1                                                       P. 43
Equal Opportunity Program

LETTER NO. 2                                                       P. 44
Working Hours

LETTER NO. 3                                                       P. 45
Combination or Elimination of Classifications

LETTER NO. 4                                                       P. 46
Holiday Pay and Disciplinary Suspension

LETTER NO. 5                                                       P. 47
Notice of Plant Closing and Severance Pay

ADDENDUM NO. 1                                                     P. 48
Traditional Health Insurance Weekly Co-Pay Projection

ADDENDUM NO. 2                                                     P. 49
HMO Health Insurance Weekly Co-Pay Projection

CALENDARS                                                          P. 50 - P. 53
2005
2006
2007
2008
</TABLE>

                                        5
<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                             ARTICLE 1 - AGREEMENT

1.1 This Agreement is entered into on this June 6, 2005 between Formsprag LLC,
hereinafter referred to as the "Company" and the International Union, United
Automobile, Aerospace and Agricultural Implement Workers of America, UAW Local
No. 155, hereinafter referred to as the "Union." This is a three and one half
year Agreement starting December 6, 2004.

1.2 The parties to this Agreement, in consideration of their mutual promises and
agreements, herein set forth in consideration of their desire to stabilize
employment, eliminate strikes, boycotts, lockouts, and a discontinuance of work,
and of their desire of securing closer cooperation between the Company, the
Union, and the Employees represented by it, promise and agree that:

                             ARTICLE 2 - RECOGNITION

2.1 The Union is recognized as the sole and exclusive representative for the
purpose of collective bargaining for all production, and maintenance, employees
employed at the Company's 23601 Hoover Road, Warren, Michigan plant, including
janitors and truck drivers, but excluding engineers, office clerical employees,
professional employees, guards and supervisors as defined in the National Labor
Relations Act, as amended. Former practices and oral and written understandings
which may have been in effect prior to this Agreement shall not constitute part
of this Agreement.

                       ARTICLE 3 - MANAGEMENT PREROGATIVES

3.1 The parties recognize that the management of the Company has the
responsibility for conducting the affairs of the Company in the interests of its
owners, its employees and its customers. The parties agree that in order to
carry out this responsibility, management retains the sole right, subject only
to the express provisions of this Agreement, to manage the business and to
direct the working forces of the Company. The Company's right to manage its
business includes, but is not limited to: the right to hire, promote, demote,
transfer, assign and direct associates; to discipline, suspend, and discharge
for just cause; to layoff employees due to lack of work or other legitimate
reasons; to make and enforce reasonable plant rules of conduct and regulations
not inconsistent with the provisions of this Agreement, to enforce company rules
equally and fairly; to increase or decrease the working force; to determine the
number of products to be manufactured and the methods, processes and materials
to be used; to determine the need for and layout of machinery and equipment; to
determine quality and establish reasonable work standards; to determine the
number of hours per day or week operations shall be carried out; to establish
and change work schedules and assignments; to subcontract, discontinue or
relocate all or any portion of the operations now or hereafter carried on at the
present facility; to schedule hours of work, including overtime, to determine
job content and to maintain safety, efficiency and order in the plant.

                        ARTICLE 4 - NO STRIKE-NO LOCKOUT

                                       6

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

4.1 The Company agrees that so long as this Agreement is in effect there shall
be no lockout. The Union, its officers, agents, members, and employees covered
by this Agreement agree that so long as the Agreement is in effect, there shall
be no strikes, partial or complete, sit-downs, slowdowns, stoppages or cessation
of work, including actions of a sympathy nature, boycotts, or any unlawful acts
of any kind that interfere with the Company's operation or the production or
sale of its products. The Company shall have the right to discipline (including
discharge) any employee who instigates, participates in, or gives leadership to
an unauthorized strike in violation of this Agreement.

4.2 The Arbitrator shall have power to review the reasonableness of penalties
imposed under this Section.

                             ARTICLE 5 - UNION SHOP

5.1 Each employee covered by this Agreement shall be or become a member of the
Union as a condition of employment not later than the 30th consecutive calendar
day following the effective date of this Agreement, or not later than the 30th
consecutive calendar day following the beginning of his employment, whichever is
later. Each such employee, as a condition of continued employment, shall remain
a member of the Union in good standing to the extent provided in the Union's
International Constitution and as authorized by the Labor Management Relations
Act of 1947, or as that Act has been or is amended. The Union shall notify the
Company in writing of any employee who fails to become or remain a member of the
Union as required above. If after receipt of such notice by the Company the
employee does not become a member or remain a member of the Union within five
(5) days (whichever is applicable) he shall be terminated.

5.2 The Union shall indemnify and save the Company harmless against any and all
claims, demands, suits or other forms of liability that shall arise out of or by
reason of action taken in reliance upon the information furnished to the Company
by the Union for the purpose of complying with Section 5.1, above.

                              ARTICLE 6 - CHECK-OFF

6.1 Upon receipt of the authorization of check-off of dues, the Company will
deduct from wages earned including jury duty pay, bereavement pay, and paid
absence allowance, and turn over to the proper Union official, initiation fees,
reinstatement fees and/or current monthly dues of such members of the Union or
Agency Shop fees of such employees as individually and voluntarily certify in
writing that they authorize such deduction for the term of the contract.

6.2 The initial deduction from the pay of an employee signing a new
authorization shall be from the second pay period following the date of his
authorization.

6.3 The deduction of Union dues shall be made from wages earned during the first
full pay period that an employee works in a calendar month and in a manner
agreed upon with the International Union. The Financial Secretary-Treasurer, or
other duly authorized Union official of each local unit will notify the Company
in writing on Union stationery, of the amount of dues each month by each
employee who has authorized a deduction and this amount will remain in effect
until changed by a similar written authority. In case of an error, proper
adjustment will be made by the Union with the employee.

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6.4 All dues deducted will be remitted to the Financial Secretary-Treasurer or
other such duly authorized Union official of each local unit not later than the
twenty-fifth day of the calendar month in which such deductions are made or as
may be otherwise agreed. The Company will furnish the aforesaid Union official
of the local union monthly a record of the employees from whose wages deductions
have been made together with the amounts of such deductions.

6.5 The Company will also furnish the Union a record of those employees who have
signed authorization cards but who have been removed from the unit payroll since
the last check-off date and for whom no dues have been collected.

6.6 In the event the Union wants the Company to collect more than one month's
regular dues from an employee it will furnish the Company with written
notification listing each employee and the amount to be collected.

6.7 The Company shall not be liable to the International Union or its locals by
reason of the requirements of this article for the remittance or payment of any
sum other than that constituting actual deductions made from employee wages.

6.8 The following wording will be used on the check-off authorization.

                       AUTHORIZATION FOR CHECK-OFF OF DUES

                         Date __________________________

     I hereby assign Local Union No. _______, International Union, United
     Automobile, Aerospace, and Agricultural Implement Workers of America (UAW),
     from any wages earned or to be earned by me as your employee while engaged
     in employment within the Bargaining Unit, such sums as the Financial
     Officer of said Local Unit No. 155 may certify as due and owing from me as
     initiation fees, reinstatement fees and membership dues as may be
     established from time to time by said local union in accordance with the
     Constitution of the International Union, UAW. I authorize and direct you to
     deduct such amounts from my pay and to remit same to the Union at such
     times and in such manner as may be agreed upon between you and the Union at
     any time while this authorization is in effect.

     This assignment, authorization and direction shall be irrevocable for the
     period of one (1) year from the date of delivery hereof to you or until the
     termination of the collective agreement between the Company and the Union
     which is in force at the time of delivery of this authorization, whichever
     occurs sooner; and I agree and direct that this assignment, authorization
     and direction shall be automatically renewed and shall be irrevocable for
     successive periods of one (1) year each or for the period of each
     succeeding applicable collective agreement between the Company and the
     Union, whichever shall be shorter, unless written notice is given by me to
     the Company and the Union not more than twenty (20) days and not less than
     ten (10) days prior to the expiration of each period of one (1) year, or of
     each applicable collective agreement between the Company and the Union
     whichever occurs sooner.

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     This authorization is made pursuant to the provisions of Section 302(c) of
     the Labor Management Relations Act of 1947 and otherwise.

6.9 It is agreed that an employee who retires will be provided the opportunity
to complete a retiree's dues check-off authorization.

                              ARTICLE 7 - SENIORITY

7.1 Seniority shall be by Classification Seniority within Occupational Groups.
The Occupational groups shall be as follows:

<TABLE>
<S>   <C>

                   GROUP I

101   Cell Operator - Primary (*)
102   Tool Room Machine Operator
103   Turning/Mill/Drill
104   Grind
105   Heat Treat Operator and Maintenance
106   Maintenance
107   Inspection
108   Auto Cutoff & Notch
109   Sprag Grind

                   GROUP II

201   Cell Operator - Secondary (*)
202   Aircraft Clutch Rebuild
203   Grotnes & Punch Press
204   Magnaflux
205   Tumble/Deburr/Bench
206   Assembly/Rebuild

                   GROUP III

301   Cell Operator - Support
302   Ship/Receive/Stock Handle /Truck Driver
303   Tool Crib/Stock Room
304   Clutch Test/Parts Clean
305   Janitor
</TABLE>

7.2 A CELL is defined as technology consisting of one or more operations during
the manufacturing process of the same component in an equipment layout
sequentially linking one or more like or unlike machines or operations.

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7.3 CELL OPERATOR-PRIMARY - A Primary Cell Operator shall be qualified to
perform a Group 1 classification operation in a cell and any other operation in
such cell as assigned.

7.4 CELL OPERATOR-SECONDARY - A Secondary Cell Operator shall be qualified to
perform a Group 2 classification operation in a cell and any other equivalent or
support operations in such cell as assigned.

7.5 CELL OPERATOR-SUPPORT - A Support Cell Operator shall be qualified to
perform Group 3 operations in a cell as assigned.

7.6 SENIORITY OF CELL OPERATORS - ( A) Seniority begins in a Cell Operator
classification as of the date the operator enters the cell (Job Bid) (B)
Seniority continues concurrently in the last classification.

7.7 FILLING OF POSTED CELL VACANCIES - "Qualified" Cell Operator posting shall
be by plant seniority of all those who have qualified at Formsprag in at least
one of the classification jobs included in the cell (and who have not waived
recall rights to such classification), ranking first all of those individuals
with previous qualification in a job from the top job group in the cell, and
next ranking the individuals from the next lower job group in the cell (if any),
and finally ranking those in the next and lowest job group in the cell (if any).
"Trainee" Cell Operator posting shall be by plant seniority following the normal
procedures in Local Article 8.

7.8 RATES FOR CELL OPERATORS - Rates for Cell Operators shall be equal to the
highest rated job assigned to such operator in the cell.

7.9 OVERTIME EOUALIZATION OF CELL OPERATORS - Cell Operators will be equalized
within their own specific cell.

7.10 WORK FORCE REDUCTION/LAYOFF - When there is a reduction of the working
force or a readjustment of the work force, the following procedure shall be
observed in the following order:

     1.   Notification to the Union, in writing twenty-four (24) hours in
          advance.

     2.   Probationary employees in the affected classification shall be laid
          off first.

     3.   If additional layoffs are necessary in the classification, the
          employee with the least classification seniority shall return to his
          last previous classification provided he has previously attained
          seniority in such classification and provided there is an employee
          with less classification seniority in the previous classification. For
          purposes of this paragraph only, where an employee has in excess of
          two (2) years seniority in his previous classification, that seniority
          will be adjusted to equal his plant seniority and, as a result, he
          will bump the junior employee in point of hire date in that previous
          classification.

     4.   When an employee has no previous classification and is laid off from
          his present classification, he may take a voluntary layoff or shall be
          permitted to "bump" the junior employee in point of hiring date in his
          present Group, except that if the lowest employee is in a higher base
          rate classification he will bump the next lowest employee (if any) in
          his

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          present Group, and then the next lowest rated Groups provided he is
          capable of performing the remaining available work in such
          classification.

     5.   Following the above steps, the youngest employee in point of date of
          hire in the remaining Group will be laid off and considered an
          inactive employee. Employees will be expected to complete their day's
          work in a normal manner after receiving layoff notice.

7.11 When a readjustment of the work force is necessary for a period in excess
of one (1) week and a layoff does not result, reductions in a classification
will be by classification seniority, and the same procedure as provided above
will be followed except that instead of layoff, the employee remaining without
an assignment will be placed on the available work.

7.12 An employee who is reassigned to a previous classification shall receive
the corresponding or appropriate number-of-months rate on Schedule 2005.

7.13 No Employee shall be permitted to exercise their seniority to bump into a
higher base rate job.

7.14 A seniority employee who has gone into other classifications due to a
readjustment of the work force and/ or layoff will return to his/her previous
classifications when recalled. However, as an exception to the above an employee
working out of a classification for a period in excess of six months, may, if
recalled, remain in his current job and relinquish classification seniority in
his previous classification. Additionally, an employee laid off to a lower
classification who subsequently bids up to a classification between the original
classification and the one from which he was laid off, may relinquish
classification seniority at any time when recalled.

7.15 Only the lowest seniority employee, or employees, in a classification
should be laid off.

7.16 Seniority Employees shall be recalled in reverse order of the layoff
provisions before any new employees are hired.

7.17 TEMPORARY ASSIGNMENT - Employees may be transferred from one classification
to another provided they are capable of doing the job and do not infringe on the
seniority rights of the employees regularly employed in the classification to
which such transfer is made. Employees on layoff in the affected classification
need not be recalled unless there is a reasonable likelihood of one (1) week's
work. Abuses of this provision shall be subject to the Grievance Procedure. The
Company will notify the Union of all temporary assignments as soon as possible.
If employees do not volunteer for temporary assignment, the employee in the
affected classification with the least seniority, who is qualified to do the
work required, shall be temporarily assigned. For all temporary assignments
scheduled, a Union representative will be notified of the temporary assignment
prior to the change in assignment, except in emergencies when the Union will be
notified as soon as possible. If a job is vacant due to sick leave, the Company
will post the job after 45 days, unless the Company and Union agree otherwise.

7.18 Employees working in a lower classification, except by reason of seniority
displacement, shall continue to receive their own rate. Employees working in a
higher rate classification for thirty (30) minutes or more shall continue to
receive their regular rate for all time worked during the

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temporary assignment, or the corresponding numbers-of-months rate on Schedule
2005, whichever is greater. As an exception to the above, employees reduced from
a classification and then subsequently reassigned to work in such classification
for one (1) hour or more, shall receive the corresponding or appropriate
number-of-months rate on Schedule 2005.

7.19 It may be necessary, from time to time, for day people to work nights, or
vice versa, in order to maintain an efficient balance of shifts, or temporarily
to schedule additional shift operations in certain classifications. If employees
do not volunteer to change shifts, the employee in the affected classification
with the least seniority, who is qualified to do the work required, shall be
temporarily required to change shifts or forfeit his/her seniority.

7.20 SHIFT PREFERENCE - When a vacancy occurs on any shift by reasons of any
available opening, except for a position to be filled by a trainee, the employee
with the most classification seniority on another shift shall be given
preference for transfer to other shifts within his classification.

     1.   Employees shall be eligible for transfer under this procedure after
          having completed their probationary period.

     2.   Employees will be permitted to bump another employee working on
          another shift in the same classification provided he- has more
          classification seniority. Individuals may exercise seniority for shift
          preference at any time with two weeks written notice. Providing that
          they have not exercised a shift bump in the prior six months, and
          providing that no shift bumps are allowed during the month of
          December. All shift bumps will take place on Monday unless the Company
          agrees otherwise.

     3.   The above shift bump will not apply to trainees with less than six (6)
          months in such classification

7.21 MISCELLANEOUS -

     1.   The Company and Union agree that cross training is desirable, as time
          permits.

     2.   The Company shall keep a true seniority list and a rate list of all
          employees having seniority rights, which shall be open to the
          inspection of the Bargaining Committee at all reasonable times. A copy
          of the seniority list shall be given to the Chief Bargaining
          Committeeman once every six (6) months for posting.

     4.   The Company agrees to submit to Local 155 on July 1st and January 1st
          of each year the following data: The name of each employee covered by
          this Agreement, his occupation and current hourly rate (including
          cost-of-living but excluding night shift premium) and the payroll
          period from which the data is taken. Rates of individuals that have
          been adjusted by other than a general or automatic increase during the
          previous six (6) months will be identified by an asterisk. .

7.22 PROBATIONARY EMPLOYEES - A new employee will be considered probationary for
a period of sixty (60) calendar days from date of last hire.- There will be no
responsibility for the

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rehiring or recalling of a probationary employee who is discharged or laid off
during his probationary period. If requested, the Company will discuss the
discharge or layoff with the Union.

7.23 A new employee hired as a temporary or vacation replacement will be
considered as a probationary employee for the first one hundred twenty (120)
days of his employment.

7.24 Immediately following his probationary period, an employee will become a
seniority employee and will be entered on the seniority list of the Bargaining
Unit and will rank for seniority from the date and hour of his last hire. A
probationary employee will not have seniority.

7.25 TRAINEES FOR EXCLUDED POSITIONS - The Company will have the right to exempt
from all seniority and wage requirements an employee enrolled for the purpose of
training and experience with the expectation that such trainee ultimately will
be assigned to permanent employment other than that covered by this Agreement.
The total of such trainees may not exceed two (2) in number at any one time, nor
may any trainee displace an employee covered by this Agreement. The Bargaining
Committee shall be notified before the training begins as to the names of the
trainees and when they will begin training.

7.26 TEMPORARY EXCLUDED EMPLOYEES - The Company may select a temporary
supervisor without regard to seniority for a period not to exceed forty-five
(45) calendar days within a calendar year and will notify the Union in writing
of the effective date of such temporary assignment. An extension of such period
may be granted by mutual agreement. Where necessary, the parties may agree to
more than one forty-five (45) calendar-day period in a calendar year. Such
employee will not be excluded from the Bargaining Unit, and at the termination
of temporary duty he will be reinstated to the job he had prior to the temporary
assignment. Stewards, Committeemen, and members of the Executive Board shall be
prohibited from accepting a position of temporary supervisor.

7.27 EXCLUDED EMPLOYEES

     1.   For an employee promoted to an excluded status, a three (3) month
          period will be established beginning with the effective date of his
          promotion. Should he return to the Bargaining Unit on or before the
          end of the three (3) month period he will do so with accumulated
          seniority. An excluded employee who does not return to the Bargaining
          Unit on or before the end of the three (3) month period will forfeit
          all Bargaining Unit seniority and will have no right to return to the
          Bargaining Unit except as a new hire.

     2.   An employee who has previously been promoted to an excluded status and
          returned to the Bargaining Unit with accumulated seniority, will
          forfeit all seniority with any subsequent promotion to an excluded
          status and will have no right to return to the Bargaining Unit except
          as a new hire.

     2.   An employee with Bargaining Unit seniority who transfers to an
          excluded status in a facility other than the facility in which he
          holds seniority will forfeit all such seniority effective with his
          transfer.

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7.28 EXCLUDED PERSONNEL WORKING - Production and maintenance work shall not be
performed by supervisors or by any other persons excluded from the bargaining
unit, except for the purpose of performing work involving the following
situations:

     1.   The instruction or training of employees.

     2.   The performance of necessary work when production difficulties are
          encountered on a job, but such work will not displace a member of the
          bargaining unit. Further, when such work is done, a member of the
          bargaining unit will stand by for instructional purposes.

     3.   The performance of research work or work of an experimental nature, or
          work involving special mechanical training.

     4.   The development of new processes.

7.29 SENIORITY DATE - Seniority records on file with the Company on the
effective date of the signing of this Agreement will establish the seniority
date of each employee. Seniority lists and recall lists shall be available at
all times and be kept up to date.

7.30 LOSS OF SENIORITY - An employee will lose his seniority:

     1.   If he quits.

     2.   If he is discharged for just cause and the discharge is not reversed
          through the Grievance Procedure.

     3.   If he has been laid off and has less than ten (10) years seniority at
          the time of layoff, he will lose seniority when the layoff period is
          equal to the seniority he had at time of layoff. For those with at
          least ten (10) years of service, seniority will expire after ten (10)
          years.

     4.   If he has been unable to work due to a medical leave of absence and
          has less than ten (10) years seniority at the time the leave begins,
          he will lose seniority when the leave of absence period is equal to
          the seniority he had at the time the leave began. For those with at
          least ten (10) years of service, seniority will expire after ten (10)
          years.

     5.   If he has been on a workers compensation leave of absence and has less
          than ten (10) years seniority at the time the leave begins, he will
          lose seniority when the leave of absence period is equal to the
          seniority he had at the time the leave began. For those with at least
          ten (10) years of service, seniority will expire after ten (10) years.

     6.   Failure to call in for three (3) consecutive work days will be
          considered as having voluntarily quit, unless such failure to call in
          is for good and sufficient reasons.

     7.   If he fails to have his leave of absence renewed by an extension in
          writing before three (3) calendar days have elapsed after his leave
          has expired, unless such failure to secure extension of leave was for
          good and sufficient reason.

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     8.   If he has been laid off and is recalled to work but fails to report
          for work within five (5) working days from the date of signing the
          certified or registered letter receipt or telegram receipt, unless the
          Company agrees to extend this period or he will lose his seniority if
          the registered letter or telegram is returned as undeliverable from
          the last known Company address.

     9.   If he accepts employment elsewhere during a leave of absence unless
          otherwise agreed to between the Company and the Union.

     10.  On the effective date of his retirement. If an employee retired for
          reasons stated herein, and lost seniority in accordance with this
          section, and is rehired, such employee will have the status of a new
          employee and without seniority, and he shall not acquire or accumulate
          any seniority thereafter, except for the purpose of applying the
          provisions governing Holiday Pay and Vacation Pay.

7.31 TEMPORARY LAYOFFS - A temporary layoff due to breakdown, shortage of
material or other emergency conditions may be made for a period not to exceed
four (4) regular working days, without regard to seniority or shift. During such
temporary layoff, an employee may not exercise seniority transfer privileges.

                        ARTICLE 8 - HOURS AND PREMIUM PAY

8.1 SCHEDULE

     1.   It is recognized that to operate the plant below a forty-hour week is
          not desirable and therefore the Company and Union agree that if the
          Company's work dictates that it is necessary to schedule the work week
          for any plant, department or classification below forty hours, the
          Company may do so for not over six weeks in any calendar year (holiday
          weeks excluded) unless agreement is reached with the Union for an
          extension of this time.

     2.   For the purpose of defining the weekly payroll period an employee's
          work week will begin on calendar Monday at the regular starting time
          of the shift to which the employee is assigned, except for those
          employees whose regular work week begins on calendar Sunday night, in
          which case their regular work week will begin at their regular
          starting time on calendar Sunday night. To improve payroll processing
          and accounting processes, the Company will change the pay period from
          "Monday through Sunday" to "Saturday through Friday. Advance
          discussion with the Union on the implementation date will occur.

8.2 OVERTIME

     1.   Straight time is paid for:

          a.   The first eight (8) hours of work performed on Monday through
               Friday.

     2.   Time and one-half is paid for:

          a.   The first three (3) hours of work performed over eight (8) hours
               Monday through Friday.

          b.   Work performed for the first eight (8) hours on Saturday.

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     3.   Double time is paid for:

          a.   Work performed over eleven (11) hours Monday through Friday.

          b.   Work performed over eight (8) hours on Saturday.

          c.   Work performed on Sunday.

          d.   Work performed on any of the paid holidays.

8.3 Although overtime work is not compulsory, the Union will not restrict
overtime in any manner, and employees will cooperate when requested by the
Management to perform overtime work. Individual refusal to work overtime (but
not concerted refusal) will not be subject to disciplinary action.

8.4 An employee who accepts an overtime assignment on a Saturday or Sunday, and
who fails to report for the assigned overtime, will be considered an absentee
under the plant rules or absentee control procedure -. Overtime and premium
rates of pay will not be pyramided.

8.5 Every effort will be made to arrange job assignments so that overtime may be
equalized within sixteen (16) hours among employees in a classification, on the
shift to which overtime becomes available. Individuals on nonstandard shift
hours will be equalized together with their classification on the standard shift
which contains the majority of their regular working hours. A uniform record
system shall be maintained. The Company will make every effort to equalize
between shifts. The employee with the lowest number of overtime hours in a
classification on the shift involved shall be asked first to work overtime,
provided the employee is able to perform the work assigned. A uniform record
system shall be maintained. The Company will make every effort to equalize
between shifts.

8.6 When possible, the Company will provide twenty-four (24) hour notification
to cancel already scheduled overtime.

8.7 The Union will be notified on Thursday for Saturday scheduled overtime and
on Friday for Sunday scheduled overtime. For all overtime scheduled, a Union
representative will be notified of the overtime prior to employee solicitation,
except in emergencies when the Union will be notified as soon as possible.

8.8 The Company will provide for at least one (1) Union representative on
assignments for overtime hours on all shifts. When a Committeeman's regular job
is needed on such overtime, he will be called in as the Union representative. If
his regular job is not scheduled to work, he will be permitted to work on
another job scheduled provided he is capable of performing such work as
determined by the Plant Superintendent. In lieu of this procedure, the Union may
appoint an alternate representative for the overtime in question.

8.9 Effective with the signing of the Labor Agreement, the following uniform
record system will be utilized in all departments:

     1.   The Company shall maintain an overtime chart, by classification, on
          each shift covering overtime worked in or out of an employee's
          classification. The chart shall be open for

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          inspection to the Bargaining Committee, and shall be reviewed
          quarterly between the Bargaining Committee and the Company

     2.   The Company will record overtime hours by calendar year.

     6.   Overtime offered to an employee and declined will be charged as
          overtime worked.

     7.   Overtime solicitation missed by an employee due to his absence from
          work will be charged as overtime worked.

     8.   Overtime missed by an employee where he has accepted the overtime
          shall be charged as overtime worked.

     9.   New seniority employees in a classification will begin to equalize
          overtime as of the date of permanent transfer to the new
          classification and shall take the amount then on record for the
          highest employee in the new classification.

     10.  Probationary employees will begin to equalize overtime in a
          classification upon completion of their probationary period, and shall
          take the amount then on record for the highest employee in the new
          classification.

     8.   Overtime for purposes herein shall mean all overtime made available
          beyond the hours the classification is scheduled.

8.10 REPORTING AND CALL-IN PAY - An employee called to work and not retained or
an employee reporting for work on any scheduled day on his regularly scheduled
shift without having previously notified not to report, and not retained, will
receive his regular hourly rate for four (4) hours, and shall receive shift
premium and premium pay on premium days. The Company may require the employee to
work at a job other than his regular classification during this four (4) hour
period. Alternatively, the employee may elect to leave after the call-in work is
completed and the company will pay the greater of two (2) hours or actual time
worked. Additionally, minimum emergency warehouse call-in pay for shipping or
delivery employees is two (2) hours.

                               ARTICLE 9 - BIDDING

9.1 Bidding, and assignment to vacant or new jobs shall be based on seniority.
Such a vacancy shall be posted for a period of three (3) working days during
which time all active employees may indicate their desire to be considered by
signing the posting provided they have been in their current classification for
a period of six (6) months or more at the time of the posting. Seniority
employees with less than six (6) months following their initial plant hire date
will be eligible to bid for posted jobs, provided they are on the seniority list
and provided they meet other contractual requirements.

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9.2 This procedure shall not prohibit the Company from hiring from the outside
after discussion with the Union when employees capable of performing the
necessary jobs are not available.

9.3 If an employee accepts a bid and then elects to return to their former job
during probation in the new classification, they will be prohibited from bidding
on any other job for a period of six months from the date they gave up the bid.
9.4 A probation period of sixty (60) calendar days shall apply from the date the
job bid is awarded.

9.5 Any employee who is transferred to a classification because of his physical
condition as evidenced by a medical certificate shall not be precluded from
returning to his regular classification as soon as the Company doctor certifies
he is able to return to that regular classification.

9.6 The Company reserves the option of posting for a qualified person in the
following classifications: Cell Operators, Tool Room Machine Operator, Heat
Treat Operator and Maintenance, and Maintenance. All other job bids will be
awarded on Plant seniority.

9.7 TRAINING SCHEDULE - For all promotions, those employees not yet at maximum
rate on Schedule 2005 will advance to the corresponding number-of-months rate
for the new job and continue progressing on the chart from that point in the new
classification. However, employees at maximum position or one increase away from
maximum position on Schedule 2005 in their new classification on a bid up will
receive their old rate for six months at which time they will be moved to
maximum in their new classification.

9.8 Permanent changes in wage rates will be made effective only at the beginning
of a pay period following the date as determined on Schedule 2005.

                           ARTICLE 10 - REPRESENTATION

10.1 Employees shall be represented by a Bargaining Committee of no more than
three (3) members. The Bargaining Committee shall be selected from a group of
nominees on the seniority list, excluding employees laid off in excess of one
(1) year, chosen pursuant to Local Union by-laws.

10.2 An agreement reached between the Management and the Bargaining Committee is
binding on all workers affected and cannot be changed by an individual.

10.3 If there are employees on the night shift or shifts, they will be
represented by an elected Night Steward who must be able to perform the work
required. Such Night Steward shall be compensated for necessary time spent
adjusting grievances in accordance with the first and second steps of the
Grievance Procedure.

10.4 One (1) Committeeman to be designated "Chief Bargaining Committeeman" will
be the last laid off when the work force is reduced, provided the Company has
work available which he is capable of performing and he is available for such
work. If the Chief bargaining Committeeman does not qualify under the above
rule, the Union may designate another employee who has been assigned to such
work to represent the employees for that period.

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

10.5 Members of the Bargaining Committee shall be compensated during regular
working hours for necessary time spent adjusting grievances, contract
negotiations, including meetings with the Company. AIl Committeemen will be
permitted to leave their work after reporting to their respective supervisor. It
is further agreed that such Committeemen shall give the Company an accurate
accounting of time lost adjusting grievances in the same manner as the job
records are kept.

10.6 The Chief Bargaining Committeeman shall head the seniority list for the
plant and shall work upon the day shift, provided he is capable of doing the
work available. The two (2) other members of the Bargaining Committee shall head
the seniority list for their respective groups, provided they are capable of
doing the work available. Committeemen shall be returned to their regular
standing on seniority upon termination of service on the Committee. Special
seniority privileges provided for committeemen, officers and stewards apply in
all cases, except recall, overtime, upgrading, vacation, and job bidding. In the
event of second or third shift operations, the shift Steward shall be the last
laid off and the first recalled, provided he is capable of performing the
available work.

10.7 LISTING OF UNION OFFICERS - Upon the signing of this Agreement and
thereafter as changes occur the International Union will notify the Company of
the names of the International Representatives it is to negotiate with and the
Union will furnish the plant with a list of Union or Unit officers, their
Executive Committee, their Bargaining Committee, and their stewards.

10.8 BARGAINING COMMITTEE ROOM - The Bargaining Committee will be permitted to
leave the Company premises to go to Local 155 offices on Union business or to
meetings and receive payment for such time at straight time rate when an
official request from the Local Union President is received.

10.9 FURNISHING OF CONTRACTS - The Company will furnish each employee with a
copy of this Agreement.

10.10 International and Local Union Representatives other than employees of the
Company shall be permitted to enter the plant if advance notice has been given
to the Human Resource Department and by registering under the regular plant
admission procedure. Union Representatives who are employees of the Company
shall be permitted access to the premises on a shift other than their own if
notice is given to the Human Resource Department or if such department is not
open, by registering under the regular plant admission procedure.

10.11 UNION LEAVE OF ABSENCE - An employee appointed or elected to a full or
part-time position in the International Union, United Automobile, Aerospace,
Agricultural Implement Workers of America, or a Local or Unit of a Local covered
by this Agreement, or any other office in the UAW will apply for and be given a
leave of absence without loss of seniority until the termination of such office.

                        ARTICLE 11 - GRIEVANCE PROCEDURE

11.1 As used in this Agreement, the term "grievance" shall mean any
misunderstanding, difference, or dispute between the Company and the Union, or
one or more of the employees

                                       19

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

represented by the Union arising out of this Agreement, or any supplemental
agreements thereto, or concerning or relating to the interpretation and
application thereof and filed subsequent to the effective date of this
Agreement.

11.2 This Grievance Procedure is divided into four levels. The Bargaining
Committee may write and sign a grievance in behalf of an employee or group of
employees. If the issue raised is not appropriate for resolution at the first or
second level, the grievance may be referred by the Bargaining Committee directly
to the 3rd level.

11.3 If, after the employee and his immediate supervisor have discussed the
complaint, the matter is not resolved to the satisfaction of the employee, it
may be considered a grievance and then the employee will be allowed to review
his/her complaint with his/her Committeeperson without delay.

11.4 FIRST LEVEL - The grievance shall be discussed between the employee, the
employee's immediate supervisor and a Union representative. If the grievance is
not resolved, it shall be reduced to writing within two (2) working days, signed
by the grievant, and submitted to the immediate supervisor for transmission to
the Production Manager.

11.5 SECOND LEVEL - The Production Manager will, within two (2) working days of
its receipt, unless otherwise agreed to, arrange a conference on the matter
between himself, the immediate supervisor, the Chief Bargaining Committeeman and
one other member of the Bargaining Committee for day shift grievances. A
conference on night shift grievances will be arranged in the same manner between
the Production Manager, the immediate supervisor, Chief Bargaining Committeeman,
and the night shift Steward. The Production Manager will give a written answer
to the grievance and return it to the Chief Bargaining Committeeman within
twenty-four (24) hours after the conference unless otherwise agreed.

11.6 THIRD LEVEL - If a satisfactory adjustment is not reached at the 2nd level
conference, the matter will, within five (5) working days after receipt of the
written answer, be taken up at a meeting between the full bargaining committee
and the management representative(s). The Union and the Company may have outside
representatives present at this meeting.

11.7 FOURTH LEVEL- ARBITRATION - If a grievance remains unsettled after the
Third Level answer by the designated representative of the Company, it may at
any time within fourteen (14) days be referred to arbitration by the Union. .

11.8 If at any level of the Grievance Procedure the grievance is not referred to
the next level, within the time limits set forth, it will be considered settled
upon the terms of the last answer. By mutual consent, time limits at any level
of the Grievance Procedure may be extended.

11.9 Any disciplinary action against an employee not previously removed from the
employee's record shall become invalid after a one year period from the date the
discipline was issued.

11.10 ARBITRATION RULES

                                       20

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     1.   The party seeking arbitration shall within the time limits specified
          above request a panel of Arbitrators from the American Arbitration
          Association. Such panel will include nine (9) Arbitrators who will all
          be members of the National Academy of Arbitrators and who have been
          active Arbitrators in the private sector for at least ten (10)
          consecutive years from the date the panel is requested. The Union and
          Company will each have one (1) preemptory challenge of a submitted
          panel.

     2.   The Union and Company will first attempt to mutually agree upon a
          selection from the panel. Should no agreement be reached, the Union
          and Company shall, in turn, strike an arbitrator's name until only one
          name remains. A single coin toss shall determine whether the Union or
          Company will make the first strike.

     3.   The non-prevailing party shall pay the cost of the Arbitrator's
          services and expenses. In the event of a split decision, the
          Arbitrator shall make as part of his/her decision, a ruling as to how
          the cost of his/her services shall be apportioned. All other expenses,
          including but not limited to wages of the participants, witness fees,
          attorney's fees or cost of exhibits will be borne by the party who
          incurred the expense.

     4.   It shall be the duty of the Arbitrator within thirty (30) days after
          the oral hearing is concluded to issue his/her decision in writing and
          to furnish a copy thereof to each of the parties. His/her decision
          shall be final and binding upon the parties.

     5.   The Union and the Company will make available for the Arbitrator's
          inspection and examination such records and data which he may deem
          necessary to inspect or examine in order to decide the issue. In
          deciding a case, it shall be the function of the Arbitrator to
          interpret the Agreement and all Supplemental Agreements thereto and to
          decide whether or not there has been a violation thereof. He shall
          have no right to change, add to, subtract from, or modify any of the
          terms of this Agreement or any Supplemental Agreements thereto or to
          establish or change any wage rates except for newly created
          classifications.

11.11 TIME LIMIT FOR RETROACTIVITY - The Company will not be required to pay any
claims for monies which accrue more than ninety (90) days before the date of
delivering the written grievance to the first supervisor provided in the
Grievance Procedure. In all cases where back wages are awarded, deduction will
be made of all outside wages and/or monetary benefits including Unemployment
compensation.

11.12 NOTICE OF DISCHARGES AND DISCIPLINARY LAYOFFS - Written notice of all
discharges and disciplinary layoffs will be given to the Bargaining Committee
before such action is to become effective. However, written notice of violation
of the Attendance Program will be given to the Bargaining Committee twenty-four
(24) hours before such action is to become effective. In the absence of a
written grievance within seven (7) calendar days on any of these notices, the
action of the Company will be considered final.

11.13 GRIEVANCE MEETINGS - The Human Resource Manager and/or designated,
authorized representatives of the Company will meet regularly with the
Bargaining Committee of the Unit each week if one or more grievances or problems
remain unsettled, and both parties shall make every

                                       21

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

effort to effect just and speedy settlement of every complaint or grievance.
When an emergency arises on a matter that cannot be handled at the regular
weekly grievance meeting, the emergency shall be taken up at a special meeting
agreed to by the Bargaining Committee and the Company. Meetings under this
section shall be held during the regular working hours.

11.14 EMPLOYEES IN GRIEVANCE MEETINGS

     1.   The Committee, upon due notice to the management, may be accompanied
          to meetings with the management by the Department Committeeman or
          Steward, upon the request of the Local Union Committee. If the Company
          concurs in the attendance of such an employee it shall pay him, but if
          the Union requests his presence without Company concurrence the Union
          shall pay him.

     2.   It is understood that only interested parties will appear at the
          grievance meetings since any other arrangement would merely retard the
          ability to settle the grievance.

     3.   When the Union desires to have present a witness or witnesses other
          than the Department Committeeman or Steward, they shall notify the
          Human Resource Manager, in writing, in advance of the grievance
          meetings, of the names of the proposed witnesses. If the Human
          Resource Manager makes no objection to the proposed witnesses they may
          be present and be paid by the Company for the time spent at the
          meeting during their scheduled working hours. If the Human Resource
          Manager takes objection to the presence of any of the witnesses, he
          shall notify the Union of his objection, but upon such notice of
          objection, the Union may present the witnesses but such witnesses
          shall be paid for by the Union. Such employees will be paid the rate
          in accordance with the local plant custom.

                           ARTICLE 12 - SUBCONTRACTING

12.1 The Company will continue the present practices on sub contracting. In the
event of a layoff the Company will meet with the Union and discuss outside
contracting with the objective of returning to a full employment level. In the
event an employee is assigned to work out of classification continuously for a
period of two weeks, the Company and Union will meet to discuss the situation as
to the effect that outside contracting may have had, or will have on such
situations, and attempt to remedy the circumstances.

                        ARTICLE 13 - NEW CLASSIFICATIONS

13.1 When a new job is created, the Company will set up a new classification and
rate covering the job in question and notify the Bargaining Committee of the
classification and rate it has established.

13.2 The new classification and rate will be considered temporary for a period
of thirty (30) calendar days following the date of notification to the
Bargaining Committee. During this period, but not thereafter, the Bargaining
Committee may request the Company to negotiate a different rate for the
classification. The negotiated rate, if higher than the temporary rate, shall be
applied retroactively to the date of the establishment of the temporary
classification and rate unless

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

otherwise mutually agreed. If no request has been made by the Union to negotiate
the rate within the thirty (30)day period, or if within sixty (60) days from the
date of notification to the Bargaining Committee no grievance is filed
concerning the temporary classification and rate, the temporary classification
and rate shall become permanent.

13.3 If a grievance is filed on the temporary classification and rate the
grievance shall be handled according to the Grievance Procedure outlined in this
contract. If the grievance is referred to the Arbitrator, he will be empowered
to determine the proper classification and/or rate for the new job, using as a
basis of comparison other jobs in the plant where the dispute exists, taking
into consideration the effort and/or skill required of the employee on the new
job. This paragraph may not be interpreted that a dispute on a production
standard is to be referred to arbitration without specific agreement by the
parties in writing.

                              ARTICLE 14 - GENERAL

14.1 Employees must possess the tools of the trade.

14.2 During inventory shutdowns, employees who are not assigned to their normal
jobs, will be given first opportunity to take inventory by seniority (length of
service). If sufficient employees do not volunteer, then employees with least
amount of plant seniority will be required to work.

14.3 The rates of pay are fixed for the life of this Agreement and the Parties
will not be required to bargain under the claim of intra-plant or inter-plant
inequities, or upon any other basis whatsoever, for increases in rates of pay or
other benefits, fringes, or otherwise. The classifications and rates are set
forth in Schedule 2005.

14.4 The Company and the Union each agrees that the other shall not be obligated
to bargain collectively with respect to any subject or matter specifically
referred to or covered in this Agreement, or with respect to any subject or
matter not specifically referred to or covered by this Agreement.

14.5 Employees will be paid during their regular working hours as per present
practice.

14.6 Upon presentation of a properly completed sickness and accident (S&A) claim
form to the Human Resources Department, the Company will provide a short term
loan (upon request) until the S&A payments begin.

14.7 It is the responsibility of the employee to maintain their current address
and telephone number on file with the company.

14.8 Employees have the option of being paid by automatic deposit into the
checking or savings account of their choice, or receiving a conventional
paycheck.

14.9 The Company and Union agree that all employees have a responsibility to
share knowledge as a part of their job.

14.10 The Company and Union will discuss in detail during the life of the
Agreement regarding ways to improve productivity, with the goal of reducing
set-up times, eliminating scrap, and increasing general plant efficiency.

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14.11 RECORDING OF EMPLOYMENT STATUS - A record will be kept of any action where
a change is made in the employment status of an employee and in each such case
the Company will furnish a copy to the Bargaining Committee and to the employee.

14.12 CHANGE OF ADDRESS - An employee will notify the Human Resource Department
of any change in address and telephone number in person, by certified or
registered mail, telegram, or mailgram, or by an authority countersigned by the
affected employee, and will receive verification of such notification on a
Company form. The extent of the Company's liability is to rely upon the last
address reported to the Company. The Bargaining Committee will be given a copy
of each change of address. When a recall is necessary the Company shall notify
the employee by certified or registered mail. Telephone, telegram, or mailgram
may be used but in such cases a certified or registered letter will be used to
confirm

14.13 UNCLAIMED WAGES - Upon request by the financial officer of the Local
Union, the Company will furnish at least once a year the names, last known
address and the amount of unclaimed wages due to such individuals.

14.14 BULLETIN BOARDS - The Company will furnish bulletin boards for the use of
the Union who may post notices which have been approved by the Bargaining
Committee. Such notices shall be signed by the Chairman or Secretary of the
Bargaining Committee and shall have a date for posting and a date for removal.

14.15 WORK RULES - The- Bargaining Committee will receive one week's advance
notice of new rules or changes in existing rules. Any protest over the new rule
will be handled through the grievance procedure.

                    ARTICLE 15 - EQUAL EMPLOYMENT OPPORTUNITY

15.1 The Company has pledged and the Union has agreed to cooperate in any and
all efforts to ensure equal employment opportunity. It is understood that the
word he or she as used throughout this Agreement will designate an employee.

                              ARTICLE 16 - VACATION

16.1 The qualifying vacation year shall be from July 1st to June 30th. Only
employees on the seniority list on the last day in June are entitled to vacation
pay.

16.2 For the purposes of this article only, an employee whose seniority falls on
the first day of the month immediately following the completion of a full year
of service in the bargaining unit, shall receive credit for vacation purposes
for such full year of service.

16.3 Vacation will be computed on the basis of seniority on the last day of June
as follows:

     1.   Six months and under one year: 1 1/2% of gross earnings during the
          qualifying vacation year.

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     2.   One year and under three years: 5% of gross earnings during the
          qualifying vacation year.

     3.   Three years and under five years: 6% of gross earnings during the
          qualifying vacation year.

     4.   Five years and under fifteen years: 7% of gross earnings during the
          qualifying vacation year.

     5.   Fifteen years and over: 8% of gross earnings during the qualifying
          vacation year.

     6.   In addition to the above, eligible employees will receive an
          additional 2/5% of gross earnings for each year of service over twenty
          years up to a maximum of an additional 2% of gross earnings for
          twenty-five years of service or more. These employees will receive
          vacation pay as follows:

     7.   Twenty-one Years and Under Twenty-two: 8-2/5% of gross earnings during
          the qualifying vacation year.

     8.   Twenty-two Years and Under Twenty-three: 8-4/5% of gross earnings
          during the qualifying vacation year.

     9.   Twenty-three Years and Under Twenty-four: 9-1/5% of gross earnings
          during the qualifying vacation year.

     10.  Twenty-four Years and Under Twenty-five: 9-3/5% of gross earnings
          during the qualifying vacation year.

     11.  Twenty-five Years and Over: 10% of gross earnings during the
          qualifying vacation year.

     12.  This additional vacation pay over 8% of gross earnings is for pay
          purposes only and is not to be equated to additional vacation time
          off.

16.4 Vacation pay will be paid to an employee who retires pursuant to the
Pension Agreement made between the parties for the vacation year in which such
employee retires. Any accumulated vacation pay will be paid as soon as practical
after the effective date of retirement. Vacation pay will be paid to the estate
of a deceased employee.

16.5 Employees may elect to receive their vacation pay in one check to be
received by July 15, or in four quarterly payments to be received by July 15,
October 15, January 15, and April 15. Employees interested in the quarterly
payment option must request it by June 15 and may not change their election
after that date. Those who do not request the quarterly option by June 15 will
be paid out in full by July 15. No interest will be paid on monies held back for
those employees requesting the quarterly payment option.

                                       25
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16.6 For the purpose of determining available time off, the following procedures
will apply:

     1.   If an employee has worked for the Company more than six (6) months
          prior to July 1st of the vacation year, and less than five (5) years
          total, he will be granted 6-2/3 hours vacation time off for each month
          worked for the Company since July 1st of the previous year.

     2.   Employees who have more than five (5) years seniority with the Company
          prior to July 1st of the vacation year, will be granted 8-2/3 hours
          vacation time off for each month worked for the Company since July 1st
          of the previous year.

     3.   Employees who have more than ten (10) years seniority with the Company
          prior to July 1st of the vacation year, will be granted 10 hours
          vacation time off for each month worked for the Company since July 1st
          of the previous year.

     4.   Employees who have more than fifteen (15) years seniority with the
          Company prior to July 1st of the vacation year, will be granted 12-2/3
          hours vacation time off for each month worked for the Company since
          July 1st of the previous year.

     5.   Employees who have more than twenty (20) years seniority with the
          Company prior to July 1st of the vacation year, will be granted 15
          hours vacation time off for each month worked for the Company since
          July 1st of the previous year.

     6.   A month worked is any calendar month during which the employee works
          at least one half (1/2) the work days of such month. Work is defined
          as time spent on the job and shall include weeks during which
          employees are absent receiving weekly disability benefits pursuant to
          Supplement B of the Master Agreement up to a maximum of 52 weeks.

16.7 MAXIMUM VACATION TIME OFF PROVIDED FULL ENTITLEMENT IS EARNED:

<TABLE>
<CAPTION>
   SENIORITY           VACATION TIME OFF
As of June 30th   For Year Starting July 1st
---------------   --------------------------
<S>               <C>
    6-Months               10 days
    5-Years                13 days
    10-Years               15 days
    15-Years               19 days
    20-Years               23 days*
</TABLE>

*    indicates rounding up since vacations are taken only in full day
     increments.

16.8 EXTRA FIVE DAY UNPAID VACATION BLOCK - Employees with at least fifteen (15)
years of seniority prior to the start of the vacation year will be allowed to
take five (5) extra unpaid vacation days during the year, provided that (a) they
must be used as a full week block of five consecutive days, and (B) they cannot
be requested until all paid vacation has been used.

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16.9 The Company reserves the right to schedule vacation time off, provided
there shall be no discrimination and seniority will be a factor. Employees
submitting vacation request for the next vacation year prior to May 15 will be
given preference on the basis of classification seniority. For vacation requests
made after May 15, the originally scheduled vacation takes precedence over
seniority. Vacation time off requests must be in eight (8) hour increments. The
intent of the above is that as many as possible schedule vacation time off
before May 15 and those that do shall have preference by seniority; those that
schedule later than May 15 shall not be allowed to use seniority as a means of
bumping those who schedule before May 15.

16.10 Vacation shutdowns will be announced prior to May 1 of any year scheduled.

16.11 All vacation time off requests must be submitted by the end of the regular
shift time the scheduled work day prior to the start of the desired vacation,
except that five days of employee vacation time off will be designated as "short
notice vacation time off days." These short notice time off vacation days may be
requested no later than the starting time of the scheduled shift on the day of
the vacation, provided that no short notice vacation time off days may be
requested on any of the last five regularly scheduled working days of any
calendar month, or the day prior to any paid holiday, or any of the days
scheduled for annual plant inventory. Employees calling in for short notice
vacation time off days prior to the shift start must either speak directly with
a supervisor, or leave a clear message including their name, department, and
exactly what day(s) are requested on the supervisor's voice mail.

                           ARTICLE 17 - PAID HOLIDAYS
                                  PAID HOLIDAYS

17.1 An employee with seniority will be paid for the following holidays:

<TABLE>
<CAPTION>
1.  First Year Of Contract (14 Holidays)
----------------------------------------
<S>                                                   <C>
(1)  Monday, July 4, 2005                             Independence Day
(2)  Monday, September 5, 2005                        Labor Day
(3)  Thursday, November 24, 2005                      Thanksgiving Day
(4)  Friday, November 25, 2005                        Day After Thanksgiving
(5)  Friday, December 23, 2005                        In lieu of Christmas Eve
(6)  Monday, December 26, 2005                        In lieu of Christmas Day
(7)  Tuesday, December 27, 2005                       Shutdown Day #1@
(8)  Wednesday, December 28, 2005                     Shutdown Day #2@
(9)  Thursday, December 29, 2005                      Shutdown Day #3@
(10) Friday, December 30, 2005                        In lieu of New Years Eve
(11) Monday, January 2, 2006                          In lieu of New Years Day
(12) Monday, January 16, 2006 (or Floating Holiday)   Martin Luther King Day or FH*
(13) Friday, April 14, 2006                           Good Friday
(14) Monday, May 29, 2006                             Memorial Day
</TABLE>

*   FH must be requested in writing 2 days in advance.

<TABLE>
<CAPTION>
2. Second Year of Contract (14 Holidays)
----------------------------------------
<S>                                                   <C>
(1)  Tuesday, July 4, 2006                            Independence Day
(2)  Monday, September 4 2006                         Labor Day
</TABLE>

                                       27

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<S>                                                   <C>
(3)  Thursday, November 23, 2006                      Thanksgiving Day
(4)  Friday, November 24, 2006                        Day After Thanksgiving
(5)  Friday, December 22, 2006                        In lieu of Christmas Eve
(6)  Monday, December 25 2006                         Christmas Day
(7)  Tuesday, December 26, 2006                       Shutdown Day #1@
(8)  Wednesday, December 27, 2006                     Shutdown Day #2@
(9)  Thursday, December 28, 2006                      Shutdown Day #3@
(10) Friday, December 29, 2006                        In lieu of New Years Eve
(11) Monday, January 1, 2007                          New Years Day
(12) Monday, January 15, 2007 (or Floating Holiday)   Martin Luther King Day or FH*
(13) Friday, April 6, 2007                            Good Friday
(14) Monday, May 28, 2007                             Memorial Day
</TABLE>

*    FH must be requested in writing 2 days in advance.

<TABLE>
<CAPTION>
3. Third Year of Contract (14 Holidays)
---------------------------------------
<S>                                                   <C>
(1)  Wednesday, July 4, 2007                          Independence Day
(2)  Monday, September 3, 2007                        Labor Day
(3)  Thursday, November 22, 2007                      Thanksgiving Day
(4)  Friday, November 23, 2007                        Day After Thanksgiving
(5)  Monday, December 24, 2007                        Christmas Eve
(6)  Tuesday, December 25, 2007                       Christmas Day
(7)  Wednesday, December 26, 2007                     Shutdown Day #1@
(8   Thursday, December 27, 2007                      Shutdown Day #2@
(9)  Friday, December 28, 2007                        Shutdown Day #3@
(10) Monday, December 31, 2007                        New Years Eve
(11) Tuesday, January 1, 2008                         In lieu of New Years Day
(12) Monday, January 21 2008 (or Floating Holiday)    Martin Luther King Day or FH*
(13) Friday, March 21, 2008                           Good Friday
(14) Monday, May 26, 2008                             Memorial Day
</TABLE>

*    FH must be requested in writing 2 days in advance.

@    Note: Shutdown Days 1, 2, and 3 are subject to rules of special scheduling.

17.2 Employees who qualify under the provisions set forth in this Article will
be paid eight (8) hours straight-time pay exclusive of night shift and overtime
premiums for each such holiday. In the case of an incentive worker, the
employee's average rate exclusive of night shift and overtime premium for the
week in which the holiday falls will be used. For holidays which comprise the
Christmas Holiday Period, the incentive worker's average rate exclusive of night
shift and overtime premium for the last full week immediately preceding the
shutdown period will be used.

17.3 HOLIDAY ELIGIBILITY REGULATIONS WHICH APPLY ONLY TO PAID HOLIDAYS OTHER
THAN THE CHRISTMAS HOLIDAY PERIOD

     1.   An employee must work at least twenty-three and one-half (23 1/2)
          hours during a work week in which a holiday falls (fifteen and one
          half (15 1/2) hours in a week in which two (2) holidays are celebrated
          during the regular five (5) day work week.

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     2.   Regular working hours during a holiday week excluding the paid holiday
          itself, in which the plant is shut down will be credited toward
          fulfilling the twenty-three and one-half (23 1/2) hour requisite in
          determining eligibility for holiday pay, or: seniority employees on
          layoff or approved leave of absence when the holiday occurs who return
          to work following the holiday but during the week in which the holiday
          falls shall receive pay for such holiday.

     3.   Notwithstanding the provisions above, seniority employees who have
          been laid off but who worked in the work week in which the holiday
          falls, or the work week prior to the week in which the holiday falls,
          shall receive pay for such holiday.

17.4 HOLIDAY ELIGIBILITY REGULATIONS WHICH APPLY ONLY TO THE CHRISTMAS HOLIDAY
PERIOD

     1.   An employee on approved Personal Leave of Absence or an employee on an
          Illness Leave of Absence, who is cleared by his doctor to return to
          work during the Christmas holiday period, shall be eligible for paid
          holidays for which he was available for work, providing he works his
          first scheduled work day following the holiday period.

     2.   Seniority employees on layoff during the Christmas Holiday Period, but
          who worked in the work week in which the Christmas Holiday Period
          begins, or in the first, second, third or fourth work week prior to
          the week in which the Holiday Period begins, will receive holiday pay
          for each of the holidays in the Holiday Period, provided they work on
          their last scheduled work day.

     3.   An employee on layoff during the Christmas holiday period who is
          scheduled to return to work during the week in which the holiday
          period ends shall be eligible for paid holidays which fall in such
          week providing he works his first scheduled work day in such week.

     4.   The twenty-three and one half (23 1/2) hours of work requirement does
          not apply to the Christmas holiday periods.

     5.   Employees must work the last scheduled work day in the week
          immediately preceding the shutdown period and the first scheduled work
          day in the week immediately following the shutdown period. An employee
          will be expected to work his entire scheduled shift on these two days.
          Time not at work due to emergency or due to causes beyond the control
          of the employee may merit consideration at the discretion of the
          Company.

     6.   A seniority employee absent without approval of his supervisor on
          either the last scheduled working day prior to or the next scheduled
          working day after a Christmas holiday period, shall be ineligible for
          pay for two (2) of the holidays in the Christmas holiday period, but
          shall, if otherwise eligible, receive pay for the remaining holidays
          in the Christmas holiday period. The two (2) days of ineligibility are
          designated to be the two (2) days closest to the day in which the
          employee was absent.

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

     7.   If an employee is scheduled for and accepts an assignment to work on a
          Saturday or Sunday immediately prior to a day of holiday such
          assignment shall be considered to be his last scheduled work day.

     8.   The parties to this Agreement recommend the exchange of paid holidays,
          on a voluntary local basis, in those cases where some work has to be
          performed during the Christmas holiday period.

     9.   The requirement that an employee work the first scheduled work day in
          the week immediately following the holiday period shall not apply to
          an employee who retires with a January 1 effective date.

17.5 CHRISTMAS HOLIDAY PERIOD

     1.   In order for employees to have maximum time off during the Christmas
          holiday period, employees will be called in to work only in
          emergencies on the following days which are not paid holidays under
          this Agreement:

               Saturday, December 31, 2005
               Sunday, January 1, 2006
               Saturday, December 30, 2006
               Sunday, December 31, 2006
               Saturday, December 29, 2007
               Sunday, December 30, 2007

     2.   An employee shall not be disqualified for holiday pay if he does not
          accept work on such days. This statement does not apply to employees
          on necessary continuous seven day operations.

     3.   It is the purpose of the Holiday Pay provisions of this Agreement to
          enable eligible employees to enjoy the specified holidays with full
          straight-time pay. If, with respect to a week included in the
          Christmas holiday period an employee supplements his Holiday Pay by
          claiming and receiving an unemployment compensation benefit, or claims
          and receives waiting period credit, to which he would not have been
          entitled if his Holiday Pay had been treated as remuneration for the
          week, the employee shall be obligated to pay to the Corporation the
          lesser of the following amounts: (A) an amount equal to his Holiday
          Pay for the week in question, or (B) an amount equal to either the
          unemployment compensation paid to him for such week or the
          unemployment compensation which would have been paid to him for such
          week if it had not been a waiting period. The Corporation will deduct
          from earnings subsequently due and payable the amount which the
          employee is obligated to pay as provided above.

17.6 HOLIDAY ELIGIBILITY REGULATIONS WHICH APPLY TO BOTH THE CHRISTMAS HOLIDAY
PERIOD AND TO OTHER PAID HOLIDAYS

     1.   An employee must have seniority as of the date of the holiday.

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

     2.   Only emergency crews will be worked on a holiday unless otherwise
          agreed prior to a holiday. An employee working on a holiday will be
          paid holiday pay under this section and in addition will be paid
          double time for hours worked on the Holiday. Notwithstanding the
          provisions above, an employee scheduled to work and accepting a work
          assignment on any of the listed holidays but failing to report for and
          to perform work will not receive pay for the holiday.

     3.   When an employee is eligible for holiday pay and also for a Weekly
          Disability Benefit for the same day, the Disability Benefit less any
          applicable Workers' Compensation Benefit will be paid and the excess
          of holiday pay over the Disability Benefit or Workers' Compensation
          Benefit, whichever is greater, will be paid as soon as practicable in
          the form of make-up holiday pay.

     4.   In the event a holiday falls within an employee's approved vacation
          period, he shall be paid for that holiday in addition to his vacation
          pay.

     5.   Approved time off for jury duty service, short-term military service
          and funeral leave will be considered as hours worked for holiday pay
          eligibility purposes.

     11.  Notwithstanding the provisions above, seniority employees who have
          gone on an approved leave of absence during the work week prior to, or
          during the work week in which the holiday falls, shall receive pay for
          such holiday.

17.7 SPECIAL CHRISTMAS HOLIDAY PROCEDURES - The following will apply to up to
three holidays that fall between Christmas and New Years Eve, provided the
Company posts a tentative work crew roster by December 10th:

     1.   Employees will be voluntarily solicited by classification to perform
          necessary work during the holiday period.

     2.   Employees working during this period shall be given the option to
          receive either double time pay or straight time pay with an equal
          amount of floating holidays to be taken with two (2) days notice at
          any time up to December 24th of the following year. If these floating
          holidays are not utilized they will be paid in lieu of time off in the
          first full pay period of the following calendar year.

     3.   Employees working during this period will be required to work in other
          classifications if the need arises.

     4.   Restrictions of overtime sharing within classifications will be waived
          for this holiday period.

     5.   If an emergency situation arises that requires additional manpower,
          the Company will attempt to contact the employee within the needed
          classifications on the basis of seniority. If no additional help can
          be obtained through this procedure, the Company reserves the right to
          use salaried employees to do the required work.

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     6.   A tentative work crew roster will be completed by December 10 of each
          year preceding the holiday period and the Union will be informed.

                          ARTICLE 18 - BEREAVEMENT PAY

18.1 When death occurs in his immediate family (current spouse, parent,
stepparent, parent or stepparent of current spouse, child, stepchild, brother,
stepbrother, sister, stepsister, grandparents, grandparents of current spouse,
grandchild, step grandchild) an active employee with seniority, on request, will
be excused for up to three (3) regularly scheduled days of work during the three
(3) days (excluding Saturdays, Sundays and paid holidays) immediately following
the death. After making written application within 30 days following the death,
the employee shall receive 24 hours pay. Days of layoff, leave of absence, and
short-term military duty are days for which the employee is not entitled to
Bereavement Pay.

18.2 When a death occurs prior to or during a vacation which is scheduled, up to
one week of vacation shall be cancelled and rescheduled, should the employee so
desire.

18.3 Payment shall be made at the employee's regular straight-time hourly rate
at the time of the death. Time thus paid will not be counted as hours worked
for purposes of overtime.

18.4 Bereavement Pay will be paid in instances involving stillborn birth after
seven months.

18.5 When the date of the funeral or memorial service is outside the initial
three-day period following the death, the employee may have his excused absence
from work delayed until the period of three normally scheduled working days,
which includes the date of the funeral.

18.6 In the event an employee is granted a leave of absence because of the
illness of a member of his immediate family and such family member dies within
the first seven (7) calendar days of the leave, the requirement that the
employee otherwise would have been scheduled to work will be waived.

                         ARTICLE 19 - PAY FOR JURY DUTY

19.1 Any employee with seniority who is called to and reports to qualify or
serve on Jury Duty (including coroner's juries) or who is subpoenaed to appear
as a witness, shall be paid the difference between his regular wages for the
number of hours, up to eight (8) that he otherwise would have been scheduled to
work -and the money he receives for each day partially or wholly spent in
performing the duties of a juror or a witness, if the employee otherwise would
have been scheduled to work for the Company. In order to receive payment under
this section, an employee must give the Human Resources Department prior notice
that he has been summoned or subpoenaed and must furnish satisfactory evidence
of the summons or subpoena and the fact that he reported and as a result lost
time on the days for which he claims such payment.

19.2 An employee who is subpoenaed to serve as a witness in a Federal or State
court of law in the state in which he is working or residing will not be
eligible for pay under this article If he:

    a) is called as a witness against the Company or its interests; or

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

     b) is called as a witness on his own behalf in an action in which he is a
     party; or

     c) voluntarily seeks to testify as a witness; or

     d) is a witness in a case arising from or related to his outside employment
     or outside business activities.

19.3 An employee assigned to the third shift will not be required to work on the
shift immediately preceding the time such employee is to report or if the hours
scheduled or the distance to be traveled substantially results in such employee
losing the scheduled workday prior to or following the day of duty, such
employee will be paid his regular wages for such day. An employee assigned to
the first shift, and an employee assigned to the second shift will not be
required to work on the day such employee is to report.

       ARTICLE 20 - SHORT-TERM MILITARY DUTY PAY AND RE-EMPLOYMENT RIGHTS

20.1 An employee with one or more years of seniority who is called to and
performs short-term active duty of thirty (30) days or less, including annual
active duty for training, as a member of the United States Armed Forces Reserve
or National Guard shall be paid by the Company for each day partially or wholly
spent in performing such duty, if the employee otherwise would have been
scheduled to work for the Company and does not work, an amount equal to the
difference, if any, between the employee's regular straight-time hourly rate on
the last day worked and his daily military earnings (including all allowances
except for rations, subsistence and travel). The Company's obligation to pay an
employee for performance of military duty under this Section is limited to a
maximum of ten (10) scheduled working days in any calendar year, except that
short term active duty for call-outs by state or federal authorities in case of
public emergency shall be limited to a maximum of thirty (30) scheduled working
days in any calendar year.

20.2 In order to receive payment under this Section an employee must give the
Company prior notice where possible of such military duty and upon his return to
work must furnish the Company with a statement of his military pay while on such
duty.

20.3 RE-EMPLOYMENT RIGHTS AND BENEFITS FOR EMPLOYEES IN MILITARY SERVICE Any
employee who enters into the Armed Forces of the United States under existing
Federal Regulations shall be granted a leave of absence and will be accorded
reinstatement rights as provided by the applicable laws then in force. While in
military service, the Company agrees to continue, at the option of the employee,
the same Hospital-Surgical-Medical-Drug coverage for dependents of the employee
as the Company furnishes to other employees in the Bargaining Unit from which he
left. For this coverage the employee will pay the Company the actual Company
rate. The maximum time limit for continuance of this insurance is three (3)
years.

                     ARTICLE 21 - PERSONAL LEAVE OF ABSENCE

21.1 An employee shall be granted a personal leave of absence provided such
leave is for good and sufficient cause as determined by the Company and is
approved by the Company, and

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such employee will accumulate seniority during such leave. Such leave will be
for a period not to exceed six (6) months with the privilege of requesting an
extension.

                      ARTICLE 22 - MEDICAL LEAVE OF ABSENCE

22.1 An employee with seniority who is unable to work because of injury or
illness shall be granted a sick leave of absence with accumulated seniority for
the duration of the disability but not to exceed six (6) months without renewal.

22.2 A medical leave of absence for injury or illness must be substantiated,
with satisfactory evidence of the employee's condition, as soon as possible but
no later than time required in Section 7.30. The Company will, however, consider
extenuating circumstances which prevent the timely submission of such evidence,
on an individual basis.

22.3 Medical leaves of absence may be granted in accordance with the disability
plan.

                         ARTICLE 23 - ON THE JOB INJURY

23.1 An - employee who is injured on the job for whom first aid is inadequate
but a doctor's care is required will, on the initial day of medical treatment,
be provided transportation to and from the doctor's office or hospital.

23.2 If the employee, in the opinion of the doctor, is able to return to work
for the balance of his shift he shall do so; if the doctor or the Company
excuses him for the balance of the shift he may go home.

23.3 An employee who must leave the plant for medical attention as described
above, shall be compensated at his regular rate of pay, up to a maximum of the
balance of the shift.

23.4 Employees who are able to return to work but need subsequent medical
attention shall be paid for time actually lost as provided above if such care
occurs during their regularly scheduled working hours. The question of the
necessity for such re-visits shall be determined by the attending physician. The
employee will make every effort to schedule such visits outside of normal
working hours.

23.5 A Union Representative will be notified and may be present when a Workers'
Compensation claim is discussed with an employee during regular working hours on
the Company premises.

23.6 If such lost time occurs on a Saturday, Sunday or a holiday for which he is
scheduled to work, the employee shall be paid on the basis of premium pay
applicable for that day.

                         ARTICLE 24 - SAFETY AND HEALTH

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24.1 The Company will conduct its plant and office in such a manner that they
will meet the requirements of workplace inspection laws and other laws for
protection of the health and safety of employees.

24.2 A Safety Committee shall be set up. This committee shall consist of the
following Company and Bargaining Unit persons: (1) Bargaining Unit: At least one
member of the Plant Committee, and at least one person from the Maintenance
Department. (2) Management: The Plant Manager will Chair the Committee, and the
Human Resources Manager and at least one Engineer will participate. The
Committee will meet monthly.

24.3 The Safety Committee shall be paid at their regular hourly rate for such
time as may be necessary to investigate and meet on safety issues. Company and
Union Safety Committee representatives may accompany Government Health and
Safety inspectors - on plant inspection tours.

24.4 Upon request of the Safety Committee, the Company will make available
copies of reports concerning Health and Safety matters. The Company will provide
copies of the OSHA "Log of Occupational Injuries and Illnesses," as it is now
constituted, to the designated Union Safety Representative.

24.5 An employee who believes he is working on an unsafe machine or operation
shall report such condition to his supervisor immediately. When required by
OSHA, the Company will provide physical examinations and other appropriate tests
for employees who are exposed to potentially toxic agents or materials, at no
cost to the employees.

24.6 Any disagreement or dispute relating to safety and/or health which cannot
be resolved by the Safety Committee may be treated as a grievance and processed
through the regular grievance procedure. When written notice is given that a
grievance based upon an alleged violation of this article, has not been
satisfactorily settled in the First Level, it shall be placed immediately in the
last level of the local agreement's Grievance Procedure, involving the local
management, local committee and the International Union Representative.

24.7 The Company shall provide the necessary or required personal protective
equipment, devices and clothing at no cost to employees in accordance with
present local practice.

24.8 A Hazardous Communication Program (HCP) has been developed that adopts the
OSHA Standards regarding hazardous materials in the workplace, and the
employees' right to know the contents and safe handling procedures of such
materials. (OSHA Standard 1910.1200 Hazard Communication.) The Safety Committee
will review the HCP Program and make recommendations for necessary updates and
improvement on an annual basis.

24.9 The Company will provide protective gloves at various safety stations for
use when assisting injured employees, in accordance with OSHA standard.

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                             ARTICLE 25 - INSURANCE

25.1 The Medical Insurance Options are shown below. The Company will continue to
offer the traditional plan and the HMO plan with no changes in benefit levels.
The Company reserves the right to change carriers and/or administrators.
Employees will pay the weekly contributions shown below or the indicated
percentage of the monthly premium, whichever is less (see Addendum 1 and
Addendum 2).

     1.   HEALTH ALLIANCE PLAN (HAP) - with the following maximum weekly
          employee contributions:

<TABLE>
<CAPTION>
                 YR1 (6-6-05 TO 6-4-06)   YR2 (6-5-06 TO 6-3-07)   YR3 (6-4-07 TO 6-1-08)
                 ----------------------   ----------------------   ----------------------
<S>              <C>                      <C>                      <C>
Single HAP:              $15.42                   $22.17                   $25.49
Couple HAP:              $35.47                   $50.98                   $58.63
Family HAP:              $40.10                   $57.64                   $66.29
</TABLE>

     2.   ANTHEM BCBS HEALTH PLAN - with the following maximum weekly employee
          contributions:

<TABLE>
<CAPTION>
                 YR1 (6-6-05 TO 6-4-06)   YR2 (6-5-06 TO 6-3-07)   YR3 (6-4-07 TO 6-1-08)
                 ----------------------   ----------------------   ----------------------
<S>              <C>                      <C>                      <C>
Single Anthem:           $17.73                   $25.49                   $29.31
Couple Anthem:           $35.47                   $50.98                   $58.63
Family Anthem:           $51.43                   $73.92                   $85.01
</TABLE>

25.2 The schedule of benefits for each plan will be fixed for the life of the
agreement, and will be made available to employees at annual open enrollment.
The above plans are subject to availability from the carrier.

25.3 OPT OUT BONUS - Employees may elect to decline health care coverage, with
proof of alternate coverage, and will receive fifty dollars ($50.00) per month
from the Company.

25.4 The Dental Insurance options are shown below. The Company will continue to
offer the current schedule of benefits under Delta Dental. The Company reserves
the right to change carriers or administrators. Employees will pay the weekly
contributions shown below:

<TABLE>
<CAPTION>
                 YR1 (6-6-05 TO 6-4-06)   YR2 (6-5-06 TO 6-3-07)   YR3 (6-4-07 TO 6-1-08)
                 ----------------------   ----------------------   ----------------------
<S>              <C>                      <C>                      <C>
Single Dental:            $1.67                    $1.92                    $2.21
Couple Dental:            $2.83                    $3.25                    $3.74
Family Dental:            $4.83                    $5.56                    $6.39
</TABLE>

Benefits include annual maximum of $1,000 per patient; Deductible $25 single or
$75 family per year; Orthodontic lifetime maximum $1,200; preventive and
diagnostic services not subject to deductible at 100% of reasonable and
customary fee; Basic Restorative Services 80/20 co-pay; Crowns 50/50 co-pay;
Prosthodontics 50/50 co-pay; Child Orthodontia 50/50 co-pay.

25.5 RETIREE INSURANCE

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     1.   VEBA - The current VEBA plan and contribution level will be maintained
          for the life of the Agreement.

     3.   HEALTH AND LIFE INSURANCE - Eligible employees with pension credited
          service dates on or before January 1, 1991 will be eligible for
          retiree health and life insurance; others none. Surviving spouse
          pensions will include health insurance on the survivor and/or eligible
          children provided they were insured under the retiree group insurance
          plan at the time of the retiree's death. Surviving spouse insurance
          terminates should the eligible survivor re-marry.

     4.   DENTAL INSURANCE - Eligible employees with pension credited service
          dates on or before January 1, 1991 will be eligible for retiree dental
          coverage for the employee only (no dependent coverage) for a period of
          two years following the date of retirement.

     5.   CONTRIBUTION - No weekly premium contribution for eligible retirees.

     6.   CARRIER - retirees may participate in any plan offered to active
          employees, subject to availability from the carrier.

25.6 DISABILITY

     1.   SICKNESS AND ACCIDENT (S&A) PLAN - The Company will provide a
          disability plan that provides a benefit of 66-2/3% of an employee's
          base pay to a maximum of $450 weekly, for a maximum benefit of
          twenty-six (26) weeks. The weekly maximum will increase during the
          life of the contract as shown below:

<TABLE>
<S>                <C>
December 6, 2004   $450
June 6, 2005       $475
June 5, 2006       $485
June 4, 2007       $500
</TABLE>

     2.   LONG TERM DISABILITY PLAN - The Company will also provide a long term
          disability plan that provides a weekly benefit of fifty percent (50%)
          of an employee's weekly base pay to a maximum of $450 weekly, for a
          maximum benefit period of twenty-four (24) months. The weekly maximum
          will increase during the life of the contract as shown below:

<TABLE>
<S>                <C>
December 6, 2004   $450
June 6, 2005       $475
June 5, 2006       $485
June 4, 2007       $500
</TABLE>

25.7 CONTINUATION OF INSURANCE BENEFITS WHILE LAID OFF OR ON DISABILITY

     1.   WHILE ON LAYOFF - Life, AD&D, health, and dental insurance will
          continue while on layoff for the length of the layoff, or for six (6)
          months maximum.

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     2.   WHILE DISABLED - Life, AD&D, health and dental insurance will continue
          for the length of the disability or for thirty (30) months maximum.

25.8 LIFE INSURANCE - The company will provide to eligible employees, forty
thousand dollars ($40,000) of group term life insurance and forty thousand
dollars ($40,000) of group accidental death and dismemberment insurance on the
employee only. The life insurance and AD&D will increase during the life of the
contract as shown below:

<TABLE>
<S>                <C>
December 6, 2004   $40,000
June 6, 2005       $45,000
June 4, 2007       $50,000
</TABLE>

25.9 OPTIONAL DEPENDENT LIFE INSURANCE - Eligible employees may purchase
optional dependent life insurance for their spouse and eligible children who are
at least fourteen days old, at rates determined by the carrier, in one of the
following two options: (1) Ten thousand dollars ($10,000) group term life on
spouse, and four thousand dollars ($4,000) group term life on each eligible
dependent child, or (2) Five thousand dollars ($5,000) group term life on
spouse, and two thousand dollars ($2,000) on each eligible dependent child.
Premiums will be paid through payroll deduction for active employees, and
employees on layoff or sick leave may continue optional dependent life insurance
coverage by paying the required premiums, for as long as their benefit
eligibility status continues according to the carrier.

25.10 EMPLOYEE ELIGIBILITY - New hires will become eligible for health, dental,
disability, life, optional dependent life, and ad&d, provided they are a full
time active employee, and provided they qualify according to plan rules, and
provided they make any required employee contribution or premium payments, on
the first calendar day of the month following completion of sixty (60) calendar
days of employment. Should the employee be disabled or otherwise ineligible on
this date all group insurance effective dates will be postponed until the
employee is in active status and has returned to work. All full time hourly
bargaining unit Employees are eligible for group insurance. Temporary and part
time employees who do not acquire seniority are not eligible.

25.11 DEPENDENT ELIGIBILITY - Dependents are eligible for health, dental, and
optional dependent life insurance, provided they qualify according to plan
rules, and the employee makes any required dependent contribution or premium
payments. The employee's spouse and unmarried dependent children (including
adopted children and step-children in the household) until the end of the
calendar year in which such children attain twenty-five (25) years of age,
provided that any child over nineteen (19) years of age must legally reside with
or be a member of the household of the employee (or may reside elsewhere
provided a court order requires the employee to provide medical care for the
child) and must be dependent upon the Employee within the meaning of the
Internal Revenue Code of the United States, and must be a full time student.
Dependents hospitalized on the dependent health insurance effective date will
not be covered in the Group until they are released from the hospital and no
longer under a physician's care, and able to carry on the regular and customary
activities of a healthy person of the same age and sex.

25.12 STATUS CHANGES - Employees are required to notify human resources of any
eligibility status changes (i.e. divorce, marriage, birth of child, etc)
immediately. Failure to do so within thirty

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(30) calendar days may jeopardize eligibility for group insurance benefits, and
could invalidate claims paid in error.

25.13 BENEFICIARY - Employees are required to keep an up-to-date beneficiary
election on file in human resources, and to notify immediately of any change.

25.14 SUMMARY PLAN DESCRIPTIONS - Summary plan descriptions will be provided
from time to time by the Company or by the carrier, as required by law.

25.15 FLEXIBLE SPENDING ACCOUNTS - The Company will make available to employees,
provided it is allowable under law, a flexible spending account for (1)
qualified health expenses and (2) qualified dependent care expenses. Both of
these accounts are optional, and require employee pre-tax contributions which
are forfeited following the calendar year if expenses submitted for
reimbursement are less than the amount contributed. Details of the plans will be
provided annually to employees for their consideration at open enrollment time.

                            ARTICLE 26 - 401(K) PLAN

26.1 The Formsprag 401(k) plan will be continued for the life of the Agreement
and a Summary Plan Description will be distributed to employees.

26.2 SPECIAL 401(k) Contribution For Pension Participants - One thousand dollars
($1,000) will be deposited into the 401K account of each pension participant on
November 1, 2007 to coincide with the freezing of the basic pension benefit in
Article 27. This special Contribution is immediately 100% vested.

26.3 ONGOING PARTICIPATION IN 401(k) PLAN FOR PENSIONERS - Beginning November 1,
2007 each pension participant that had their basic benefit frozen as shown in
Article 27 will also be given a two percent (2%) Company Contribution in their
401(k) plan each anniversary date. The first contribution will include the time
period from November 1, 2007 until the first anniversary date following November
1, 2007; thereafter, the contributions will be annually on the anniversary date.
All employees with three or more years of service are immediately 100% vested in
these Contributions.

26.4 NEW HIRES and 401(k): All employees hired on or after December 3, 2001 will
participate in the Company's 401(k) plan in lieu of participating in the pension
plan. These employees will receive lump sum contributions on their anniversary
date to their 401(k) accounts as follows:

     1.   ANNIVERSARY OF COMPLETING FIRST YEAR OF EMPLOYMENT - One percent (1%)
          of employee's gross earnings.

     2.   ANNIVERSARY OF COMPLETING SECOND YEAR OF EMPLOYMENT - One and one-half
          percent (1.5%) of employee's gross earnings.

     3.   ANNIVERSARY OF COMPLETING THIRD YEAR OF EMPLOYMENT - Two percent
          (2.0%) of employee's gross earnings.

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     4.   EACH ANNIVERSARY OF COMPLETING A YEAR THEREAFTER - Two percent (2.0%)
          of employee's gross earnings.

     5.   VESTING - The above Company contributions will vest at the end of the
          employee's third year of continuous employment. At this time they will
          be 100% vested.

                              ARTICLE 27 - PENSION

27.1 The Pension Plan will be continued, with the following modifications, for
the life of the Agreement and Summary Plan Descriptions will be distributed to
employees.

27.2 BASIC BENEFIT - $32.50. Freeze additional accumulation of pension benefit
service on October 31, 2007. Additional service still counts toward meeting
supplement service milestones.

27.3 EARLY RETIREMENT SUPPLEMENT - maintained for all employees whose pension
credited service date is January 1, 1991 or earlier. Eliminated for all other
employees.

27.4 INTERIM SUPPLEMENT - maintained for all employees whose pension credited
service date is January 1, 1991 or earlier. Eliminated for all other employees.

27.5 MEDICARE BENEFIT - maintained for all eligible employees on the seniority
list as of the December 3, 2001.

27.6 SURVIVOR PENSION BENEFIT OPTION - maintained for all eligible employees on
the seniority list as of December 3, 2001.

27.7 SPECIAL EARLY PENSION BENEFIT OPTION - maintained for all eligible
employees on the seniority list as of December 3, 2001.

27.8 TEMPORARY BENEFIT SUPPLEMENT (Part of Special Early) - Eliminated.

                               ARTICLE 28 - WAGES

28.1 WAGES

     1.   FIRST YEAR OF CONTRACT - There will be a seven hundred fifty ($750)
          lump sum ratification bonus to be paid to all seniority employees by
          June 17, 2005. Employees hired before ratification date but yet on the
          seniority list will only receive the bonus if they complete their
          probationary period with the Company.

     2.   SECOND YEAR OF CONTRACT - There will be a lump sum wage payment equal
          to two percent (2%) of gross earnings for the prior fifty-two (52)
          week period ending June 4, 2006, to be paid to all eligible employees
          on the seniority list by June 26, 2006.

                                       40

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

     3.   THIRD YEAR OF CONTRACT - There will be a lump sum wage payment equal
          to two percent (2%) of gross earnings for the prior fifty-two (52)
          week period ending June 3, 2007, to be paid to all eligible employees
          on the seniority list by June 25, 2007.

28.2 COLA

     1.   PAYOUT OF COLA - All accumulated COLA through June 5, 2005 will be
          paid out to eligible employees by June 17, 2005.

     2.   Further COLA is eliminated from the Contract.

28.3 RATE SCHEDULE AND CLASSIFICATIONS - The rates and classifications at
Formsprag are shown on Schedule 2005. Effective June 6, 2005 the schedule will
be recomputed showing four years from minimum to maximum. New rates to be
effective for all work performed on or after June 6, 2005.

                       Article 29 - TRANSFER OF AGREEMENT

29.1 This Agreement shall be binding upon the Company and/or the Union
successors, assigns or transferees.

                        Article 30 - SEPARABILITY CLAUSE

30.1 In the event that any of the provisions of this Agreement shall be or
become invalid or unenforceable by reasons of any Federal or State Law or
Executive Order now existing or hereafter enacted, such invalidity or
unenforceability shall not affect the remainder of the provisions of this
Agreement. In addition, the parties may agree upon a replacement from the
affected provision(s). Such replacement provision(s) shall become effective
immediately upon agreement of the parties, without the need for further
ratification by the Union membership, and shall remain in effect for the
duration of this Agreement.

                            Article 31 - TERMINATION

31.1 The foregoing constitutes an agreement between the Company and the Union.
It is to become effective June 6, 2005, the date of the Monday following
ratification and to continue in effect until 12:01 a.m., June 2, 2008. If either
party desires to modify, amend, or terminate the Agreement, it shall give at
least sixty (60) days written notice to the other party before 12:01 a.m., June
2, 2008.

31.2 If neither party serves notice of modification, amendment, or termination,
the Agreement shall continue beyond 12:01 a.m., June 2, 2008, subject to sixty
(60) days written notice of modification, amendment, or termination.

31.3 This Agreement replaces all Company agreements, supplements, and
amendments.

                                       41

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

30.4 In witness whereof, the parties have on the 6th day of June, 2005, caused
this Agreement to be signed by their duly authorized representatives.

FOR THE UNION:                          FOR THE COMPANY:

-------------------------------------   ----------------------------------------
Bob Hecker                              David Ebling
VP - UAW Local 155                      General Manager

-------------------------------------   ----------------------------------------
Dennis Krol                             Tim McGowan
Plant Chairman                          VP - Human Resources

-------------------------------------   ----------------------------------------
Clay Farley                             Ed Novotny
Committeeman                            VP - Operations

-------------------------------------   ----------------------------------------
Ralph Thomas                            Gary Simpler
Committeeman                            Shawe & Rosenthal, LLP

                                        ----------------------------------------
                                        Kirby Smith
                                        Mgr - Human Resources

                                        ----------------------------------------
                                        Donna Packer
                                        Mgr - Human Resources

                                        ----------------------------------------
                                        David Meeker
                                        Finance Mgr.

                                       42
<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                                  LETTER NO. 1

                                                                    June 6, 2005

To: Mr. Bob Hecker
    and Formsprag Bargaining Committee

Re: Equal Opportunity Program

Dear Mr. Hecker:

     All employees are encouraged to contribute and grow to the limit of their
desire and ability by the use of the Company training and education programs,
and tuition assistance programs which are to be administered without regard to
race, religion, color, sex, age, national origin, disabled veterans, veterans of
the Vietnam era, or certified physical or mental disability.

     Recruitment of new employees is to be conducted in a manner to assure full
equal employment opportunities, and all decisions on employment are to be based
on this principle of equal employment opportunity.

     As new developments take place regarding equal employment matters, the
information will be communicated to all local management and union bargaining
committees and our employees as rapidly as possible.

     We agree to review and discuss ways and means of encouraging employees and
grievance representatives to use the grievance and arbitration procedure as the
exclusive contractual method to resolve claims of denial of equal application
rights.

                                        Sincerely,

                                        ----------------------------------------
                                        Kirby H. Smith
                                        Manager of Human Resources

                                       43

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                                  LETTER NO. 2

                                                                    June 6, 2005

To: Mr. Bob Hecker and
    Formsprag Bargaining Committee

Re: Working Hours

Dear Mr. Hecker:

     The Company was asked to provide the Union, in writing, with its
negotiations positions regarding starting and quitting times, break times,
wash-up times, and lunch period.

     The Company intends to continue the schedule shown for the life of the
Agreement.

     Should business conditions or Government regulations change, however, which
make rearrangement of the times necessary in the Company's opinion, the Union
will be advised of the change in advance of the effective date.

     The amount of time permitted is as follows:

<TABLE>
<S>                     <C>
Breaks                  10 minutes - A.M.
                        10 minutes - P.M.
      Total             20 minutes

Wash-up
   (before lunch)       5 minutes - A.M.
   (before shift end)   5 minutes - P.M.
      Total             10 minutes
</TABLE>

The present work schedule is as follows:

<TABLE>
<CAPTION>
                       Day Shift         Afternoon Shift       Midnight Shift
                       ---------         ---------------       --------------
<S>               <C>                  <C>                  <C>
Starting Time     6:30 a.m.            3:00 p.m.            10:30 p.m.
Morning Break     9:20 - 9:30 a.m.     5:20 - 5:30 p.m.     1:20 - 1:30 a.m.
Unpaid Lunch      11:00 - 11:30 a.m.   7:30 - 8:00 p.m.     3:00 - 3:30 a.m.
Afternoon Break   1:20 - 1:30 p.m.     10:00 - 10:10 p.m.   5:20 - 5:30 a.m.
Quitting Time     3:00 p.m.            11:30 p.m.           7:00 a.m.
</TABLE>

                                        Sincerely,

                                        ----------------------------------------
                                        Kirby H. Smith
                                        Manager of Human Resources

                                       44

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                                  LETTER NO. 3

                                                                    June 6, 2005

To: Mr. Bob Hecker and
    Formsprag Plant Bargaining Committee

Subject: Combination or Elimination of Classifications

Dear Mr. Hecker:

     It appears that efforts toward combining classifications and tasks provide
benefits to both the employees and the Company. Therefore, we consider it
mutually advantageous to continue these efforts and discussions during the
course of the new contract period.

     Specifically when classifications become vacant, we have agreed to meet
with you and discuss their combination or elimination.

     This agreement to discuss does not change any rights that the Company now
has under the current Labor Agreement to combine or eliminate classifications.

     This will confirm our mutual understanding that if classifications are
combined in the future, the relative seniority positions in the new
classification will reflect the actual classification seniority held by the
effected employees prior to the combination.

     We further agree to review with you any combinations of classifications
which occurred in the preceding Labor Agreement and make appropriate adjustments
to assure that classification seniority is determined in the manner described
above.

                                        ----------------------------------------
                                        Kirby H. Smith
                                        Manager of Human Resources

                                       45

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                                  LETTER NO. 4

                                                                    June 6, 2005

To: Mr. Bob Hecker
    and Formsprag Bargaining Committee

Re: Holiday Pay and Disciplinary Suspension

Dear Mr. Hecker:

This will confirm that for the life of this Agreement, the Company will continue
its policy of not affecting an employee's holiday pay entitlement as a result of
a disciplinary suspension.

                                        Sincerely,

                                        ----------------------------------------
                                        Kirby H. Smith
                                        Manager of Human Resources

                                       46

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

                                  LETTER NO. 5

                                                                    June 6, 2005

To: Mr. Bob Hecker and
    Formsprag Bargaining Committee

Subject: Notice of Plant Closing and Severance Pay

Dear Mr. Hecker:

     Should it become necessary to discontinue the Formsprag Clutch operation,
the Company will give the Union a minimum of six (6) months advance notice.

     In addition, the Company will provide severance pay to eligible employees
affected by such a closing as follows:

     1.   Employees who are on the active payroll at the time notice of plant
          closure is given to the Union, or at any time between such notice and
          the date of plant closure, will receive severance benefits equal to
          three months (13 weeks) pay at the employee's base rate.

     2.   Employees hired by the Company on or after December 3, 2001 are not
          eligible for severance benefits.

     3.   In order to receive severance benefits, eligible employees must remain
          employed by the Company until such time as they are released by the
          Company due to the cessation of operations.

                                        Sincerely,

                                        ----------------------------------------
                                        Kirby H. Smith
                                        Manager of Human Resources

                                       47

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

ADDENDUM NO. 1

Employee co-pay will be as shown or the indicated percentage, whichever is
lower.

ANTHEM BC/BS RATES

Assumes 15.0% annual healthcare rate increase

<TABLE>
<CAPTION>
                         YR1 -EFF. 6-6-05   YR2- EFF, 6-5-06   YR3 - EFF. 6-4-07
                         ----------------   ----------------   -----------------
<S>      <C>             <C>                <C>                <C>
SINGLE   TOTAL MO.
         PREMIUM            $  384.20          $  441.83           $  508.10

         YOUR CO-PAY
         MONTHLY            $   76.84          $  110.46           $  127.03

         YOUR CO-PAY
         WEEKLY             $   17.73          $   25.49           $   29.31

         YOUR % CO-PAY           20.0%              25.0%               25.0%

COUPLE   TOTAL MO.
         PREMIUM            $  768.42          $  883.68           $1,016.24

         YOUR CO-PAY
         MONTHLY            $  153.68          $  220.92           $  254.06

         YOUR CO-PAY
         WEEKLY             $   35.47          $   50.98           $   58.63

         YOUR % CO-PAY           20.0%              25.0%               25.0%

FAMILY   TOTAL MO.
         PREMIUM            $1,114.23          $1,281.36           $1,473.57

         YOUR CO-PAY
         MONTHLY            $  222.85          $  320.34           $  368.39

         YOUR CO-PAY
         WEEKLY             $   51.43          $   73.92           $   85.01

         YOUR % CO-PAY           20.0%              25.0%               25.0%
</TABLE>

                                       48

<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

ADDENDUM NO. 2

Employee co-pay will be as shown or the indicated percentage, whichever is
lower.

HEALTH ALLIANCE PLAN

Assumes 15.0% annual healthcare rate increase

<TABLE>
<CAPTION>
                         Yr1 -eff. 6-6-05   Yr2- eff, 6-5-06   Yr3 - eff. 6-4-07
                         ----------------   ----------------   -----------------
<S>      <C>             <C>                <C>                <C>
SINGLE   TOTAL MO.
         PREMIUM             $334.10            $384.22            $  441.85

         YOUR CO-PAY
         MONTHLY             $ 66.82            $ 96.05            $  110.46

         YOUR CO-PAY
         WEEKLY              $ 15.42            $ 22.17            $   25.49

         YOUR % CO-PAY          20.0%              25.0%                25.0%

COUPLE   TOTAL MO.
         PREMIUM             $768.43            $883.69            $1,016.25

         YOUR CO-PAY
         MONTHLY             $153.69            $220.92            $  254.06

         YOUR CO-PAY
         WEEKLY              $ 35.47            $ 50.98            $   58.63

         YOUR % CO-PAY          20.0%              25.0%                25.0%

FAMILY   TOTAL MO.
         PREMIUM             $868.85            $999.18            $1,149.05

         YOUR CO-PAY
         MONTHLY             $173.77            $249.79            $  287.26

         YOUR CO-PAY
         WEEKLY              $ 40.10            $ 57.64            $   66.29

         YOUR % CO-PAY          20.0%              25.0%                25.0%
</TABLE>

                                       49
<PAGE>

FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<CAPTION>
    JANUARY 2005                 FEBRUARY 2005                MARCH 2005
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
                   1               1  2  3  4  5                1  2  3  4  5
 2  3  4  5  6  7  8         6  7  8  9 10 11 12          6  7  8  9 10 11 12
 9 10 11 12 13 14 15        13 14 15 16 17 18 19         13 14 15 16 17 18 19
16 17 18 19 20 21 22        20 21 22 23 24 25 26         20 21 22 23 24 25 26
23 24 25 26 27 28 29        27 28                        27 28 29 30 31
30 31

3:graphic. 10:graphic.      2:graphic. 8:graphic.        3:graphic. 10:graphic.
17:graphic. 25:graphic.     15:graphic. 24:graphic.      17:graphic. 25:graphic.
</TABLE>

<TABLE>
<CAPTION>
     APRIL 2005                     MAY 2005                    JUNE 2005
--------------------        ----------------------        --------------------
<S>                         <C>                           <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa          Su Mo Tu We Th Fr Sa
                1  2         1  2  3  4  5  6  7                    1  2  3  4
 3  4  5  6  7  8  9         8  9 10 11 12 13 14           5  6  7  8  9 10 11
10 11 12 13 14 15 16        15 16 17 18 19 20 21          12 13 14 15 16 17 18
17 18 19 20 21 22 23        22 23 24 25 26 27 28          19 20 21 22 23 24 25
24 25 26 27 28 29 30        29 30 31                      26 27 28 29 30

2:graphic. 8:graphic.       1:graphic. 8:graphic.        6:graphic. 15:graphic.
16:graphic. 24:graphic.     16:graphic. 23:graphic.      22:graphic. 28:graphic.
                            30:graphic.
</TABLE>

<TABLE>
<CAPTION>
      JULY 2005                   AUGUST 2005               SEPTEMBER 2005
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
                1  2            1  2  3  4  5  6                      1  2  3
 3  4  5  6  7  8  9         7  8  9 10 11 12 13          4  5  6  7  8  9 10
10 11 12 13 14 15 16        14 15 16 17 18 19 20         11 12 13 14 15 16 17
17 18 19 20 21 22 23        21 22 23 24 25 26 27         18 19 20 21 22 23 24
24 25 26 27 28 29 30        28 29 30 31                  25 26 27 28 29 30
31

6:graphic. 14:graphic.      5:graphic. 13:graphic.       3:graphic. 11:graphic.
21:graphic. 28:graphic.     19:graphic. 26:graphic.      18:graphic. 25:graphic.
</TABLE>

<TABLE>
<CAPTION>
    OCTOBER 2005                 NOVEMBER 2005                  DECEMBER 2005
--------------------        ----------------------          --------------------
<S>                         <C>                             <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa            Su Mo Tu We Th Fr Sa
                   1               1  2  3  4  5                         1  2  3
 2  3  4  5  6  7  8         6  7  8  9 10 11 12             4  5  6  7  8  9 10
 9 10 11 12 13 14 15        13 14 15 16 17 18 19            11 12 13 14 15 16 17
16 17 18 19 20 21 22        20 21 22 23 24 25 26            18 19 20 21 22 23 24
23 24 25 26 27 28 29        27 28 29 30                     25 26 27 28 29 30 31
30 31

3:graphic. 10:graphic.      2:graphic. 9:graphic.           1:graphic. 8:graphic.
17:graphic. 25:graphic.     16:graphic. 23:graphic.         15:graphic. 23:graphic.
                                                            31:graphic.
</TABLE>

                                       50

<PAGE>
FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<CAPTION>
    JANUARY 2006                 FEBRUARY 2006                MARCH 2006
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
 1  2  3  4  5  6  7                  1  2  3  4                   1  2  3  4
 8  9 10 11 12 13 14         5  6  7  8  9 10 11          5  6  7  8  9 10 11
15 16 17 18 19 20 21        12 13 14 15 16 17 18         12 13 14 15 16 17 18
22 23 24 25 26 27 28        19 20 21 22 23 24 25         19 20 21 22 23 24 25
29 30 31                    26 27 28                     26 27 28 29 30 31

6:graphic. 14:graphic.      5:graphic. 13:graphic.       6:graphic. 14:graphic.
22:graphic. 29:graphic.     21:graphic. 28:graphic.      22:graphic. 29:graphic.
</TABLE>

<TABLE>
<CAPTION>
     APRIL 2006                    MAY 2006                    JUNE 2006
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
                   1            1  2  3  4  5  6                      1  2  3
 2  3  4  5  6  7  8         7  8  9 10 11 12 13          4  5  6  7  8  9 10
 9 10 11 12 13 14 15        14 15 16 17 18 19 20         11 12 13 14 15 16 17
16 17 18 19 20 21 22        21 22 23 24 25 26 27         18 19 20 21 22 23 24
23 24 25 26 27 28 29        28 29 30 31                  25 26 27 28 29 30
30

5:graphic. 13:graphic.      5:graphic. 13:graphic.       3:graphic. 11:graphic.
21:graphic. 27:graphic.     20:graphic. 27:graphic.      18:graphic. 25:graphic.
</TABLE>

<TABLE>
<CAPTION>
      JULY 2006                   AUGUST 2006               SEPTEMBER 2006
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
                   1               1  2  3  4  5                         1  2
 2  3  4  5  6  7  8         6  7  8  9 10 11 12          3  4  5  6  7  8  9
 9 10 11 12 13 14 15        13 14 15 16 17 18 19         10 11 12 13 14 15 16
16 17 18 19 20 21 22        20 21 22 23 24 25 26         17 18 19 20 21 22 23
23 24 25 26 27 28 29        27 28 29 30 31               24 25 26 27 28 29 30
30 31

3:graphic. 11:graphic.      2:graphic. 9:graphic.        7:graphic. 14:graphic.
17:graphic. 25:graphic.     16:graphic. 23:graphic.      22:graphic. 30:graphic.
                            31:graphic.
</TABLE>

<TABLE>
<CAPTION>
    OCTOBER 2006                 NOVEMBER 2006               DECEMBER 2006
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa          Su Mo Tu We Th Fr Sa
 1  2  3  4  5  6  7                  1  2  3  4                          1  2
 8  9 10 11 12 13 14         5  6  7  8  9 10 11           3  4  5  6  7  8  9
15 16 17 18 19 20 21        12 13 14 15 16 17 18          10 11 12 13 14 15 16
22 23 24 25 26 27 28        19 20 21 22 23 24 25          17 18 19 20 21 22 23
29 30 31                    26 27 28 29 30                24 25 26 27 28 29 30
                                                          31

7:graphic. 14:graphic.      5:graphic. 12:graphic.       5:graphic. 12:graphic.
22:graphic. 29:graphic.     20:graphic. 28:graphic.      20:graphic. 27:graphic.
</TABLE>

                                       51

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FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<CAPTION>
    JANUARY 2007                 FEBRUARY 2007                MARCH 2007
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
    1  2  3  4  5  6                     1  2  3                      1  2  3
 7  8  9 10 11 12 13         4  5  6  7  8  9 10          4  5  6  7  8  9 10
14 15 16 17 18 19 20        11 12 13 14 15 16 17         11 12 13 14 15 16 17
21 22 23 24 25 26 27        18 19 20 21 22 23 24         18 19 20 21 22 23 24
28 29 30 31                 25 26 27 28                  25 26 27 28 29 30 31

3:graphic. 11:graphic.      2:graphic. 10:graphic.       3:graphic. 12:graphic.
19:graphic. 25:graphic.     17:graphic. 24:graphic.      19:graphic. 25:graphic.
</TABLE>

<TABLE>
<CAPTION>
     APRIL 2007                    MAY 2007                    JUNE 2007
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
 1  2  3  4  5  6  7               1  2  3  4  5                         1  2
 8  9 10 11 12 13 14         6  7  8  9 10 11 12          3  4  5  6  7  8  9
15 16 17 18 19 20 21        13 14 15 16 17 18 19         10 11 12 13 14 15 16
22 23 24 25 26 27 28        20 21 22 23 24 25 26         17 18 19 20 21 22 23
29 30                       27 28 29 30 31               24 25 26 27 28 29 30

2:graphic. 10:graphic.      2:graphic. 10:graphic.       1:graphic. 8:graphic.
17:graphic. 24:graphic.     16:graphic. 23:graphic.      15:graphic. 22:graphic.
                                                         30:graphic.
</TABLE>

<TABLE>
<CAPTION>
      JULY 2007                   AUGUST 2007               SEPTEMBER 2007
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
 1  2  3  4  5  6  7                  1  2  3  4                            1
 8  9 10 11 12 13 14         5  6  7  8  9 10 11          2  3  4  5  6  7  8
15 16 17 18 19 20 21        12 13 14 15 16 17 18          9 10 11 12 13 14 15
22 23 24 25 26 27 28        19 20 21 22 23 24 25         16 17 18 19 20 21 22
29 30 31                    26 27 28 29 30 31            23 24 25 26 27 28 29
                                                         30

7:graphic. 14:graphic.      5:graphic. 12:graphic.       4:graphic. 11:graphic.
22:graphic. 30:graphic.     20:graphic. 28:graphic.      19:graphic. 26:graphic.
</TABLE>

<TABLE>
<CAPTION>
    OCTOBER 2007                 NOVEMBER 2007               DECEMBER 2007
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
    1  2  3  4  5  6                     1  2  3                            1
 7  8  9 10 11 12 13         4  5  6  7  8  9 10          2  3  4  5  6  7  8
14 15 16 17 18 19 20        11 12 13 14 15 16 17          9 10 11 12 13 14 15
21 22 23 24 25 26 27        18 19 20 21 22 23 24         16 17 18 19 20 21 22
28 29 30 31                 25 26 27 28 29 30            23 24 25 26 27 28 29
                                                         30 31

3:graphic. 11:graphic.      1:graphic. 9:graphic.        1:graphic. 9:graphic.
19:graphic. 26:graphic.     17:graphic. 24:graphic.      17:graphic. 24:graphic.
                                                         31:graphic.
</TABLE>

                                       52

<PAGE>
FORMSPRAG LLC AND UAW LOCAL 155-LABOR AGREEMENT EXPIRES 12:01 A.M. JUNE 2, 2008

<TABLE>
<CAPTION>
    JANUARY 2008                 FEBRUARY 2008                MARCH 2008
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
       1  2  3  4  5                        1  2                            1
 6  7  8  9 10 11 12         3  4  5  6  7  8  9          2  3  4  5  6  7  8
13 14 15 16 17 18 19        10 11 12 13 14 15 16          9 10 11 12 13 14 15
20 21 22 23 24 25 26        17 18 19 20 21 22 23         16 17 18 19 20 21 22
27 28 29 30 31              24 25 26 27 28 29            23 24 25 26 27 28 29
                                                         30 31

8:graphic. 15:graphic.      7:graphic. 14:graphic.       7:graphic. 14:graphic.
22:graphic. 30:graphic.     21:graphic. 29:graphic.      21:graphic. 29:graphic.
</TABLE>

<TABLE>
<CAPTION>
     APRIL 2008                    MAY 2008                    JUNE 2008
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
       1  2  3  4  5                     1  2  3          1  2  3  4  5  6  7
 6  7  8  9 10 11 12         4  5  6  7  8  9 10          8  9 10 11 12 13 14
13 14 15 16 17 18 19        11 12 13 14 15 16 17         15 16 17 18 19 20 21
20 21 22 23 24 25 26        18 19 20 21 22 23 24         22 23 24 25 26 27 28
27 28 29 30                 25 26 27 28 29 30 31         29 30

6:graphic. 12:graphic.      5:graphic. 12:graphic.       3:graphic. 10:graphic.
20:graphic. 28:graphic.     20:graphic. 28:graphic.      18:graphic. 26:graphic.
</TABLE>

<TABLE>
<CAPTION>
      JULY 2008                   AUGUST 2008               SEPTEMBER 2008
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
       1  2  3  4  5                        1  2             1  2  3  4  5  6
 6  7  8  9 10 11 12         3  4  5  6  7  8  9          7  8  9 10 11 12 13
13 14 15 16 17 18 19        10 11 12 13 14 15 16         14 15 16 17 18 19 20
20 21 22 23 24 25 26        17 18 19 20 21 22 23         21 22 23 24 25 26 27
27 28 29 30 31              24 25 26 27 28 29 30         28 29 30
                            31

3:graphic. 10:graphic.      1:graphic. 8:graphic.        7:graphic. 15:graphic.
18:graphic. 25:graphic.     16:graphic. 24:graphic.      22:graphic. 29:graphic.
                            30:graphic.
</TABLE>

<TABLE>
<CAPTION>
    OCTOBER 2008                 NOVEMBER 2008               DECEMBER 2008
--------------------        ----------------------       --------------------
<S>                         <C>                          <C>
Su Mo Tu We Th Fr Sa        Su Mo Tu We Th Fr Sa         Su Mo Tu We Th Fr Sa
          1  2  3  4                           1             1  2  3  4  5  6
 5  6  7  8  9 10 11         2  3  4  5  6  7  8          7  8  9 10 11 12 13
12 13 14 15 16 17 18         9 10 11 12 13 14 15         14 15 16 17 18 19 20
19 20 21 22 23 24 25        16 17 18 19 20 21 22         21 22 23 24 25 26 27
26 27 28 29 30 31           23 24 25 26 27 28 29         28 29 30 31
                            30

7:graphic. 14:graphic.      6:graphic. 13:graphic.       5:graphic. 12:graphic.
21:graphic. 28:graphic.     19:graphic. 27:graphic.      19:graphic. 27:graphic.
</TABLE>

                                       53

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]