Exhibit 10.1

INDEMNITY AGREEMENT

     This Indemnity Agreement, dated as of _________ ___, ______, is made by and between Altra Holdings, Inc. a Delaware corporation (the “Company”), and _________ (the “Indemnitee”).

RECITALS

     A.      The Company is aware that competent and experienced persons are increasingly reluctant to serve as directors, officers or agents of corporations unless they are protected by comprehensive liability insurance or indemnification, due to increased exposure to litigation costs and risks resulting from their service to such corporations, and due to the fact that the exposure frequently bears no reasonable relationship to the compensation of such directors, officers and other agents.

     B.      The statutes and judicial decisions regarding the duties of directors and officers are often difficult to apply, ambiguous, or conflicting, and therefore fail to provide such directors, officers and agents with adequate, reliable knowledge of legal risks to which they are exposed or information regarding the proper course of action to take.

     C.      Plaintiffs often seek damages in such large amounts and the costs of litigation may be so enormous (whether or not the case is meritorious), that the defense and/or settlement of such litigation is often beyond the personal resources of directors, officers and other agents.

     D.      The Company believes that it is unfair for its directors, officers and agents and the directors, officers and agents of its subsidiaries to assume the risk of huge judgments and other expenses which may occur in cases in which the director, officer or agent received no personal profit and in cases where the director, officer or agent was not culpable.

     E.      The Company recognizes that the issues in controversy in litigation against a director, officer or agent of a corporation such as the Company or its subsidiaries are often related to the knowledge, motives and intent of such director, officer or agent, that he is usually the only witness with knowledge of the essential facts and exculpating circumstances regarding such matters, and that the long period of time which usually elapses before the trial or other disposition of such litigation often extends beyond the time that the director, officer or agent can reasonably recall such matters; and may extend beyond the normal time for retirement for such director, officer or agent with the result that he, after retirement or in the event of his death, his spouse, heirs, executors or administrators, may be faced with limited ability and undue hardship in maintaining an adequate defense, which may discourage such a director, officer or agent from serving in that position.

     F.      Based upon their experience as business managers, the Board of Directors of the Company (the “Board”) has concluded that, to retain and attract talented and experienced individuals to serve as directors, officers and agents of the Company and its subsidiaries and to encourage such individuals to take the business risks necessary for the success of the Company and its subsidiaries, it is necessary for the Company to contractually indemnify its directors, officers and agents and the directors, officers and agents of its subsidiaries, and to assume for

itself maximum liability for expenses and damages in connection with claims against such directors, officers and agents in connection with their service to the Company and its subsidiaries, and has further concluded that the failure to provide such contractual indemnification could result in great harm to the Company and its subsidiaries and the Company’s stockholders.

     G.      Section 145 of the General Corporation Law of Delaware, under which the Company is organized (“Section 145”), empowers the Company to indemnify its directors, officers, employees and agents by agreement and to indemnify persons who serve, at the request of the Company, as the directors, officers, employees or agents of other corporations or enterprises, and expressly provides that the indemnification provided by Section 145 is not exclusive.

     H.      The Company desires and has requested the Indemnitee to serve or continue to serve as a director, officer or agent of the Company and/or one or more subsidiaries of the Company free from undue concern for claims for damages arising out of or related to such services to the Company and/or one or more subsidiaries of the Company.

     I.      Indemnitee is willing to serve, or to continue to serve, the Company and/or one or more subsidiaries of the Company, provided that he is furnished the indemnity provided for herein.

AGREEMENT

     NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows:

     1.      Definitions .

               (a)      Agent . For the purposes of this Agreement, “agent” of the Company means any person who is or was a director, officer, employee or other agent of the Company or a subsidiary of the Company; or is or was serving at the request of, for the convenience of, or to represent the interests of the Company or a subsidiary of the Company as a director, officer, employee or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise; or was a director, officer, employee or agent of a foreign or domestic corporation which was a predecessor corporation of the Company or a subsidiary of the Company, or was a director, officer, employee or agent of another enterprise at the request of, for the convenience of, or to represent the interests of such predecessor corporation.

               (b)      Expenses . For purposes of this Agreement, “expenses” include all out-of-pocket costs of any type or nature whatsoever (including, without limitation, all attorneys’ fees and related disbursements), actually and reasonably incurred by the Indemnitee in connection with either the investigation, defense or appeal of a proceeding or establishing or enforcing a right to indemnification under this Agreement or Section 145 or otherwise; provided, however, that “expenses” shall not include any judgments.

               (c)      Proceeding . For the purposes of this Agreement, “proceeding” means any threatened, pending, or completed action, suit or other proceeding, whether civil, criminal, administrative, or investigative.

               (d)      Subsidiary . For purposes of this Agreement, “subsidiary” means any corporation of which more than 50% of the outstanding voting securities are owned directly or indirectly by the Company, by the Company and one or more other subsidiaries, or by one or more other subsidiaries.

     2.      Agreement to Serve . The Indemnitee agrees to serve and/or continue to serve as agent of the Company, in the capacity Indemnitee currently serves as an agent of the Company, so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the Bylaws of the Company or any subsidiary of the Company (or pursuant to the terms of a separate agreement, if such agreement exists) or until such time as he is removed from that capacity or tenders his resignation in writing; provided, however, that nothing contained in this Agreement is intended to create any right to employment (or, if applicable, continued employment) by Indemnitee.

     3.      Liability Insurance .

               (a)      Maintenance of D&O Insurance . The Company hereby covenants and agrees that, so long as the Indemnitee shall continue to serve as an agent of the Company and thereafter so long as the Indemnitee shall be subject to any possible proceeding by reason of the fact that the Indemnitee was an agent of the Company, the Company shall promptly obtain and maintain in full force and effect directors’ and officers’ liability insurance (“D&O Insurance”) in amounts determined by the Board, from time to time, to be reasonable and from established and reputable insurers.

               (b)      Rights and Benefits . In all policies of D&O Insurance, the Indemnitee shall be named as an insured in such a manner as to provide the Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company’s directors, if the Indemnitee is a director; or of the Company’s officers, if the Indemnitee is not a director of the Company but is an officer.

     4.      Mandatory Indemnification . Subject to Section 9 below, the Company shall indemnify the Indemnitee as follows:

               (a)      Successful Defense . To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding (including, without limitation, an action by or in the right of the Company) to which the Indemnitee was a party by reason of the fact that he is or was an agent of the Company at any time, against all expenses of any type whatsoever by him in connection with the investigation, defense or appeal of such proceeding.

               (b)      Third Party Actions . If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding (other than an action by or in the right of the Company) by reason of the fact that he is or was an agent of the Company, or by reason of anything done or not done by him in any such capacity, the Company shall indemnify the Indemnitee against any and all expenses and liabilities of any type whatsoever (including, but not

limited to, judgments, fines, ERISA excise taxes and penalties, and amounts paid in settlement) in connection with or relating to the investigation, defense, arbitration, settlement or appeal of such proceeding, provided the Indemnitee acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.

               (c)      Derivative Actions . If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding by or in the right of the Company by reason of the fact that he is or was an agent of the Company, or by reason of anything done or not done by him in any such capacity, the Company shall indemnify the Indemnitee against all expenses in connection with or relating to the investigation, defense, arbitration, settlement, or appeal of such proceeding, provided the Indemnitee acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company and its stockholders; except that no indemnification under this subsection 4(c) shall be made in respect to any claim, issue or matter as to which such person shall have been finally adjudged to be liable to the Company by a court of competent jurisdiction unless and only to the extent that the court in which such proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such amounts which the court shall deem proper.

               (d)      Actions where Indemnitee is Deceased . If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding by reason of the fact that he is or was an agent of the Company, or by reason of anything done or not done by him in any such capacity, and if prior to, during the pendency or after completion of such proceeding Indemnitee becomes deceased, the Company shall indemnify the Indemnitee’s heirs, executors and administrators against any and all expenses and liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes and penalties, and amounts paid in settlement) to the extent Indemnitee would have been entitled to indemnification pursuant to Sections 4(a), 4(b), or 4(c) above were Indemnitee still alive.

               (e)      No Duplication of Payments . Notwithstanding the foregoing, the Company shall not be obligated to indemnify the Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes and penalties, and amounts paid in settlement) for which payment is actually made to or on behalf of Indemnitee under a valid and collectible insurance policy of D&O Insurance, or under a valid and enforceable indemnity clause, by-law or agreement.

               (f)      Presumption of Entitlement . In making any determination as to whether the Indemnitee met an applicable standard of conduct, it shall be presumed that the Indemnitee has satisfied the applicable standard of conduct, and the Company may overcome such presumption only by its adducing clear and convincing evidence to the contrary. Any standard of conduct determination that is adverse to the Indemnitee may be challenged by the Indemnitee in a court of competent jurisdiction. No determination by the Company that the Indemnitee has not satisfied any applicable standard of conduct shall be a defense to any claim by the Indemnitee for indemnification or reimbursement or advance payment of expenses by the Company hereunder or create a presumption that the Indemnitee has not met any applicable standard of conduct.

               (g)      No Other Presumption . For purposes of this Agreement, the termination of any proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the Indemnitee did not meet any applicable standard of conduct or that indemnification hereunder is otherwise not permitted.

     5.      Partial Indemnification . If the Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes and penalties, and amounts paid in settlement) incurred by him in the investigation, defense, settlement or appeal of a proceeding, but not entitled, however, to indemnification for all of the total amount hereof, the Company shall nevertheless indemnify the Indemnitee for such total amount except as to the portion hereof to which the Indemnitee is not entitled.

     6.      Mandatory Advancement of Expenses . Subject to Section 8(a) below, the Company shall advance all expenses incurred by the Indemnitee in connection with the investigation, defense, settlement or appeal of any proceeding to which the Indemnitee is a party or is threatened to be made a party by reason of the fact that the Indemnitee is or was an agent of the Company upon a receipt of an undertaking executed by the Indemnitee in which the Indemnitee undertakes to repay such advanced amount only if, and to the extent that, it shall ultimately be determined that the Indemnitee is not entitled to be indemnified by the Company as authorized hereby. Indemnitee’s right to such advancement is not subject to the satisfaction of any standard of conduct. The advances to be made hereunder shall be paid by the Company to the Indemnitee within twenty (20) days following delivery of a written request therefor by the Indemnitee to the Company. In the event that the Company fails to pay expenses as incurred by the Indemnitee as required by this paragraph, Indemnitee may seek mandatory injunctive relief from any court having jurisdiction to require the Company to pay expenses as set forth in this paragraph. If Indemnitee seeks mandatory injunctive relief pursuant to this paragraph, it shall not be a defense to enforcement of the Company’s obligations set forth in this paragraph that Indemnitee has an adequate remedy at law for damages.

     7.      Notice and Other Indemnification Procedures .

               (a)      Promptly after receipt by the Indemnitee of notice of the commencement of or the threat of commencement of any proceeding, the Indemnitee shall, if the Indemnitee believes that indemnification with respect thereto may be sought from the Company under this Agreement, notify the Company of the commencement or threat of commencement thereof. The failure by the Indemnitee to timely notify the Company of any proceeding shall not relieve the Company from any liability hereunder unless, and only to the extent that, the Company did not otherwise learn of such proceeding and such failure results in forfeiture by the Company of substantial defenses, rights or insurance coverage.

               (b)      If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 7(a) hereof, the Company has D&O Insurance in effect, the Company shall give prompt notice (with a copy to the Indemnitee) of the commencement of such

proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

               (c)      In the event the Company shall be obligated to pay the expenses and / or liabilities relating to any proceeding against the Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by the Indemnitee, upon the delivery to the Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that (i) the Indemnitee shall have the right to employ his counsel in any such proceeding at the Indemnitee’s expense; and (ii) if (A) the employment of counsel by the Indemnitee has been previously authorized by the Company, (B) the Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee in the conduct of any such defense, or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee’s counsel shall be at the expense of the Company. Neither the Company nor the Indemnitee shall unreasonably withhold consent to any proposed settlement, provided that the Indemnitee may withhold consent to any settlement that does not provide a complete and unconditional release of the Indemnitee.

     8.      Exceptions . Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:

               (a)      Claims Initiated by Indemnitee . To indemnify or advance expenses to the Indemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemnitee and not by way of defense, unless (i) such indemnification is expressly required to be made by law, (ii) the proceeding was authorized by the Board, (iii) such indemnification is provided by the Company, in its sole discretion, pursuant to the powers vested in the Company under the General Corporation Law of Delaware or (iv) the proceeding is brought to establish or enforce a right to indemnification under this Agreement or any other statute or law or otherwise as required under Section 145; or

               (b)      Unauthorized Settlements . To indemnify the Indemnitee under this Agreement for any amounts paid in settlement of a proceeding unless the Company consents to such settlement, which consent shall not be unreasonably withheld.

     9.      Non-exclusivity . The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights which the Indemnitee may have under any provision of law, the Company’s Certificate of Incorporation or Bylaws, the vote of the Company’s stockholders or disinterested directors, other agreements, or otherwise, both as to action in his official capacity and to action in another capacity while occupying his position as an agent of the Company, (collectively, “Other Indemnity Provisions”); provided , however , that (a) to the extent that the Indemnitee otherwise would have any greater right to indemnification under any Other Indemnity Provision, the Indemnitee will be deemed to have such greater right hereunder and (b) to the extent that any change is made to any

Other Indemnity Provision which permits any greater right to indemnification than that provided under this Agreement as of the date hereof, the Indemnitee will be deemed to have such greater right hereunder. The Company will not adopt any amendment to its Certificate of Incorporation or Bylaws the effect of which would be to deny, diminish or encumber the Indemnitee’s right to indemnification under this Agreement or any Other Indemnity Provision. The Indemnitee’s rights hereunder shall continue after the Indemnitee has ceased acting as an agent of the Company and shall inure to the benefit of the heirs, executors and administrators of the Indemnitee.

     10.      Enforcement . Any right to indemnification or advances granted by this Agreement to Indemnitee shall be enforceable by or on behalf of Indemnitee in any court of competent jurisdiction if (i) the claim for indemnification or advances is denied, in whole or in part, or (ii) no disposition of such claim is made within ninety (90) days of request therefor. Indemnitee, in such enforcement action, if successful in whole or in part, shall be entitled to be paid also the expense of prosecuting his claim. It shall be a defense to any action for which a claim for indemnification is made under this Agreement (other than an action brought to enforce a claim for expenses pursuant to Section 6 hereof, provided that the required undertaking has been tendered to the Company) that Indemnitee is not entitled to indemnification because of the limitations set forth in Sections 4 and 8 hereof. Neither the failure of the Corporation (including its Board of Directors or its stockholders) to have made a determination prior to the commencement of such enforcement action that indemnification of Indemnitee is proper in the circumstances, nor an actual determination by the Company (including its Board of Directors or its stockholders) that such indemnification is improper, shall be a defense to the action or create a presumption that Indemnitee is not entitled to indemnification under this Agreement or otherwise.

     11.      Subrogation . In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

     12.      Survival of Rights .

               (a)      All agreements and obligations of the Company contained herein shall continue during the period Indemnitee is an agent of the Company and shall continue thereafter so long as Indemnitee shall be subject to any possible claim or threatened, pending or completed action, suit or proceeding, whether civil, criminal, arbitrational, administrative or investigative, by reason of the fact that Indemnitee was serving in the capacity referred to herein.

               (b)      The Company shall require any successor to the Company (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

     13.      Interpretation of Agreement . It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification to the Indemnitee to the fullest extent permitted by law including those circumstances in which indemnification would otherwise be discretionary.

     14.      Severability . If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever, (i) the validity, legality and enforceability of the remaining provisions of the Agreement (including without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby, and (ii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraph of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable and to give effect to Section 13 hereof.

     15.      Modification and Waiver . No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

     16.      Notice . All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee or (ii) if mailed by certified or registered mail with postage prepaid, on the third business day after the mailing date. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice.

     17.      Governing Law . This Agreement shall be governed exclusively by and construed according to the laws of the State of Delaware as applied to contracts between Delaware residents entered into and to be performed entirely within Delaware.

[Remainder of Page Intentionally Left Blank]

     The parties hereto have entered into this Indemnity Agreement effective as of the date first above written.

		COMPANY:
		Altra Holdings, Inc.
		By:
		Title:		Chief Executive Officer
				Address:		14 Hayward Street
						Quincy, MA 02171
		INDEMNITEE:
		By:
		Name:
		Address:

[Signature Page to Indemnity Agreement of Altra Holdings, Inc.]

Exhibit 10.2

CHANGE OF CONTROL AGREEMENT

     THIS CHANGE OF CONTROL AGREEMENT (the “ Agreement ”), dated as of [                      ___], 2008, is entered into by and among Altra Holdings, Inc., a Delaware corporation (“ Holdings ”), Altra Industrial Motion, Inc., a Delaware corporation and wholly-owned subsidiary of Holdings (the “ Company ”), and [                      ] (the “ Executive ”).

     WHEREAS, Executive is a skilled and dedicated employee who has important management responsibilities and talents that benefit Holdings, the Company and its Subsidiaries. Holdings and the Company believe that their respective best interests will be served if Executive is encouraged to remain with the Company or its Subsidiaries. Holdings and the Company have determined that Executive’s ability to perform Executive’s responsibilities and utilize Executive’s talents for the benefit of Holdings, the Company and its Subsidiaries, and the Company’s ability to retain Executive as an employee, will be significantly enhanced if Executive is provided with fair and reasonable protection from the risks of a change in control of Holdings or the Company.

     Accordingly, Holdings, the Company and Executive agree as follows:

          1. Defined Terms .

     Unless otherwise indicated, capitalized terms used in this Agreement which are defined in Schedule A shall have the meanings set forth in Schedule A .

          2. Effective Date; Term .

     This Agreement shall be effective as of [                      , 2008] (the “ Effective Date ”) and shall remain in effect until [                      , 2009] (the “ Term ”); provided , however , that commencing with first (1 ^st ) anniversary date and on each anniversary thereof (each an “ Extension Date ”), the Term shall be automatically extended for an additional one-year period, unless the Company or Executive provides the other party hereto at least 90 days’ prior written notice before the applicable Extension Date that the Term shall not be so extended. Notwithstanding the foregoing, this Agreement shall, if in effect on the date of a Change of Control, remain in effect for twenty-four (24) months following the Change of Control.

          3. Change of Control Benefits .

     If Executive’s employment with the Company and its Subsidiaries is terminated at any time upon or within the twenty-four (24) months immediately following a Change of Control by the Company and its Subsidiaries without Cause or by Executive for Good Reason (the effective date of either such termination hereafter referred to as the “ Termination Date ”), Executive shall be entitled to, and Holdings and the Company shall be required to provide, subject to Executive’s execution of an effective general release (i.e., not revoked) in favor of Holdings and the Company in the form attached hereto as Exhibit A (the “ Release ”) and the Executive’s compliance with the restrictive covenants attached hereto as Exhibit B , the payments and benefits provided hereafter in this Section 3 and as set forth in this Agreement. If Executive’s employment by the Company and any of its Subsidiaries is terminated within

ninety (90) days prior to a Change of Control by the Company without Cause in connection with or in anticipation of such Change of Control at the request of, or upon the initiative of, the buyer in the Change of Control transaction (an “ Anticipatory Termination ”), Executive shall be entitled to, and Holdings and the Company shall be required to provide, subject to Executive’s execution of the Release, the benefits provided hereafter in this Section 3 and as otherwise set forth in this Agreement (but only if an anticipated Change of Control actually occurs during the Term) and Executive’s Termination Date shall be deemed to have occurred immediately following the Change of Control. If Executive is terminated for any other reason (e.g., for Cause, due to death or Total Disability, or resignation without Good Reason), the Company shall have no obligation to make any payments under this Agreement.

     Notice of termination without Cause or resignation for Good Reason shall be given in accordance with Section 10, and shall indicate the specific termination provision hereunder relied upon, the relevant facts and circumstances and the Termination Date.

     (a) Severance Payments . Subject to execution of the Release, and the provisions of Section 5 (relating to parachute payments) and Section 8 (in the case that Executive is a “specified employee”), within the period commencing on the Termination Date and ending on the later of (i) 15 business days after the Termination Date and (ii) the day following the end the revocation period under the Release (the “ Payment Period ”), the Company shall pay Executive a cash lump sum equal to [___times (___x)] the Executive’s Base Salary then in effect immediately prior to the event set forth in the notice of termination giving rise to the Termination Date plus an amount equal to [___times (___x)] the Executive’s target Bonus amount for the year of termination.

     (b) Continuation of Active Employee Benefits . For [___(___)] months following the Termination Date (the “ Welfare Continuation Period ”), the Company shall provide Executive and Executive’s spouse and dependents (each as defined under the applicable program) with medical and dental insurance coverages at the same benefit level as provided to similarly situated active employees of the Company during the Welfare Continuation Period, for which the Company will reimburse Executive during the Welfare Continuation Period or, if shorter, the period of actual COBRA continuation coverage received by Executive during the Welfare Continuation Period, for the total amount of the monthly COBRA medical and dental insurance premiums paid by Executive for such continued benefits (thereby reducing such premium obligations to zero); provided , however , that if Executive becomes employed by a new employer that offers any medical and/or dental, continuing medical and/or dental coverage from the Company shall cease, regardless of the Welfare Continuation Period.

     (c) Payment of Earned But Unpaid Amounts . Within the Payment Period, the Company shall pay Executive any unpaid Base Salary and/or Bonus through the Termination Date. For the avoidance of doubt, Executive shall be entitled to a pro-rated Bonus for the year of termination. In addition, Executive shall be entitled to prompt reimbursement of any unreimbursed expenses properly incurred by Executive in accordance with Company policies prior to the Termination Date.

     (d) Equity Incentive Awards . Any time periods, conditions or contingencies relating to the exercise or realization of, or lapse of restrictions under, any outstanding equity incentive award then held by Executive shall be automatically accelerated or waived effective as of the Termination Date.

          4. Mitigation .

     Executive shall not be required to mitigate damages or the amount of any payment provided for under this Agreement by seeking other employment or otherwise, and, subject to Section 3(b), compensation or benefits earned from such employment or otherwise shall not reduce the amounts otherwise payable under this Agreement.

          5. Gross-up Payments .

     If the Executive becomes subject to the excise tax imposed by Code Section 4999 (the “ Parachute Excise Tax ”) with respect to any payment(s), benefit(s) or distribution(s) received by, or payable to or for the benefit of, Executive (or otherwise) in connection with, or by reason of, any Change in Control or any change in ownership or effective control of the Company (as determined under IRC Section 280G), the Company and the Executive agree that the Company shall pay to the Executive a tax gross-up payment so that after payment by the Executive of all federal, state and local excise, income, employment, Medicare and any other taxes (including any related penalties and interest) resulting from the payment of the parachute payments and the tax gross-up payments to the Executive by the Company, the Executive retains on an after-tax basis an amount equal to the amount that the Executive would have retained if he had not been subject to the Parachute Excise Tax.

          6. Arbitration .

     All disputes and controversies arising under or in connection with this Agreement shall be settled by arbitration conducted before one arbitrator sitting in Suffolk County, Massachusetts, or such other location agreed by the parties hereto, in accordance with the rules for expedited resolution of employment disputes of the American Arbitration Association then in effect. The determination of the arbitrator shall be made within thirty days following the close of the hearing on any dispute or controversy and shall be final and binding on the parties. Judgment may be entered on the award of the arbitrator in any court having proper jurisdiction. Each party shall pay its own costs and expenses in connection with any arbitration relating to the interpretation or enforcement of any provision of this Agreement.

          7. Assignment .

     Except as otherwise provided herein, this Agreement shall be binding upon, inure to the benefit of and be enforceable by Holdings, the Company and Executive and their respective heirs, legal representatives, successors and assigns. If Holdings or the Company shall be merged into or consolidated with another entity, the provisions of this Agreement shall be binding upon and inure to the benefit of the entity surviving such merger or resulting from such consolidation. Holdings and the Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of

the business or assets of Holdings or the Company, by operation of law or agreement, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that Holdings and the Company would be required to perform it if no such succession had taken place. The provisions of this Section 7 shall continue to apply to each subsequent employer of Executive hereunder in the event of any subsequent merger, consolidation or transfer of assets of such subsequent employer.

          8. Withholding and Deferral .

     Notwithstanding any other provision of this Agreement, Holdings and the Company may, to the extent required by law, withhold applicable federal, state and local income and other taxes from any payments due to Executive hereunder. Notwithstanding any other provision of this Agreement or certain compensation and benefit plans of Holdings, the Company or its Subsidiaries, the Company shall from time to time compile a list of “specified employees” as defined in, and pursuant to, Reg. Section 1.409A-1(i) of the Code or any successor regulation. Notwithstanding any other provision herein, if the Executive is a specified employee on the Termination Date, no payment of compensation under this Agreement (other than a payment that the Company determines is not subject to, or is subject to an exception from, Section 409A of the Code) shall be made to the Executive before the date that is six months after the Termination Date of employment, unless the Company determines that there is no reasonable basis for believing that making such payment would cause Executive to suffer any adverse tax consequences pursuant to Section 409A of the Code. If any payment to Executive is delayed pursuant to the immediately preceding sentence, such payment instead shall be made on the first business day following the expiration of the six-month period referred to in that sentence; provided that any such payment may be made upon Executive’s death if the death occurs before the date that is six months after the Termination Date. In addition, if any payment to Executive is delayed pursuant to this Section 8, the Executive shall be entitled to receive interest on any delayed amounts, calculated at the annualized rate of the prime rate, published in the Wall Street Journal on the date the payments under this Agreement would otherwise be due, minus one (1) percentage point.

          9. Applicable Law .

     This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, without regard to conflicts of laws principles thereof.

          10. Notice .

     Any notice provided for in this Agreement must be in writing and must be either personally delivered, mailed by first class mail (postage prepaid and return receipt requested), sent by reputable overnight courier service (charges prepaid), or faxed to the recipient at the address below indicated or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party.

If to Holdings or the Company:

Altra Holdings, Inc.

Altra Industrial Motion, Inc.
14 Hayward Street
Quincy, MA 02171
Attention: Corporate Secretary

If to Executive:

     To the most recent address of Executive set forth in the personnel records of the Company.

     Any notice under this Agreement shall be deemed to have been given when personally delivered, one business day after sent by reputable overnight courier service, five days after deposit in the U.S. mail (or when actually received, if earlier), or at such time as it is transmitted via facsimile, with receipt confirmed.

          11. Entire Agreement; Offset; Modification .

     (a) This Agreement constitutes the entire agreement between the parties and, except as expressly provided herein, supersedes the provisions of all other prior agreements (including any employment agreement that may be in effect at the time of the Change of Control between Holdings, the Company and the Executive) expressly concerning the effect of a termination of employment in connection with or following a Change of Control on the relationship between Holdings, the Company and its Affiliates and Executive.

     (b) This Agreement shall not interfere in any way with the right of Holdings or the Company to reduce Executive’s compensation or other benefits or terminate Executive’s employment, with or without Cause.

     (c) This Agreement may be changed only by a written agreement executed by Holdings, the Company and Executive.

          12. Other Agreements .

     Notwithstanding anything herein to the contrary, in the event Executive has a separate employment agreement or other agreement with the company, or is subject to a policy or plan with the Company, that provides Executive with benefits or other payments in connection with a severance, such Executive shall be entitled to receive benefits and payments under only one of this change of control agreement or such other agreement or such other policy, whichever is most favorable to the Executive at the time of such severance.

          13. Counterparts .

     This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

* * *

      IN WITNESS WHEREOF , the parties have executed this Agreement on the                      day of                                           , 2008.

		ALTRA HOLDINGS, INC.
		By: Title:
		ALTRA INDUSTRIAL MOTION, INC.
		By: Title:
		EXECUTIVE
		[Name]

Schedule A

CERTAIN DEFINITIONS

As used in this Agreement, and unless the context requires a different meaning, the following terms, when capitalized, have the meaning indicated below:

     I. “ Affiliate ” means, with respect to any entity, any other corporation, organization, association, partnership, sole proprietorship or other type of entity, whether incorporated or unincorporated, directly or indirectly controlling or controlled by or under direct or indirect common control with such entity.

     II. “ Base Salary ” means Executive’s annual rate of base salary in effect on the date in question.

     III. “ Board ” means the board of directors of Holdings or the Company, as applicable.

     IV. “ Bonus ” means the amount payable to Executive under Holdings or the Company’s applicable annual incentive bonus plan with respect to a fiscal year of such entity.

     V. “ Cause ” means (i) Executive’s material breach of the terms of any agreement between Executive and Holdings or the Company; (ii) Executive’s willful failure or refusal to perform material duties of his position; (iii) Executive’s willful insubordination or disregard of the legal directives of the Board or the Chief Executive Officer which are not inconsistent with the scope, ethics and nature of Executive’s duties and responsibilities; (iv) Executive’s engaging in misconduct which has a material adverse impact on the reputation, business, business relationships or financial condition of Holdings or the Company; (v) Executive’s commission of an act of fraud or embezzlement against Holdings or the Company or any of their Subsidiaries; or (vi) any conviction of, or plea of guilty or nolo contendere by, Executive with respect to a felony (other than a traffic violation), a crime involving moral turpitude, fraud or misrepresentation; provided, however, that Cause shall not be deemed to exist under any of clauses (i), (ii) or (iii) unless Executive has been given reasonably detailed written notice of the grounds for such Cause and Executive has not effected a cure within twenty (20) days of the date of receipt of such notice.

     VI. “ Change of Control ” means, and shall be deemed to have occurred when:

	(1)		any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) becomes the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of Holdings representing fifty percent (50%) or more of the combined voting power of Holdings’ then-outstanding securities; or
	(2)		individuals who, on the Effective Date, constitute the Board of Holdings (the “Incumbent Board”) cease for any reason over a period of one (1) year to constitute a majority of the number of directors then

			serving on the Board; provided , however , that any new director whose appointment or election by the Incumbent Board or a vote of at least a majority of the directors then still in office who either were directors on the Effective Date, or whose appointment, election or nomination for election was previously so approved or recommended, shall be considered as though such person were a member of the Incumbent Board; or
	(3)		there is consummated a merger or consolidation of Holdings, the Company or any Subsidiary with any other corporation (in one or a series of related transactions), other than (A) a merger or consolidation that would result in the voting securities of Holdings outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) more than fifty percent (50%) of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, or (B) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the combined voting power of the Company’s then-outstanding securities; or
	(4)		there is consummated one or more sales, leases, exchanges, or other transfers (in one or a series of related transactions) of all or substantially all of Holdings’ or the Company’s assets.

     VII. “ COBRA ” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

     VIII. “ Code ” means the Internal Revenue Code of 1986, as amended.

     IX. “ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

     X. “ Good Reason ” means any of the following: (i) without Executive’s express consent, any material change in Executive’s job title, any significant change in Executive’s reporting relationships or a significant reduction of Executive’s duties, position or responsibilities relative to Executive’s duties, position or responsibilities in effect immediately prior to such reduction, or Executive’s removal from such position, duties and responsibilities, unless he is provided with comparable duties, position and responsibilities; (ii) a material reduction by the Company (other than a reduction on the same basis as other senior executives) in the kind or level of employee benefits to which he is entitled immediately prior to such reduction with the result that Executive’s overall benefits package is significantly reduced; (iii) a relocation of the Executive’s principal work location to more than fifty (50) miles from the Executive’s current principal work location; or (iv) the Company’s failure to

cause Executive’s employment agreement and its obligations thereunder to be expressly assumed by the Company’s successor.

     XI. “ Subsidiary ” means a subsidiary corporation, as defined in Section 424(f) of the Code (or any successor section thereto).

     XII. “ Total Disability ” means a determination by an independent competent medical authority (selected by the Board) that Executive is unable to perform his duties under this Agreement and in all reasonable medical likelihood such inability will continue for a period in excess of 120 days (whether or not consecutive) in any 365 day period.

Exhibit A

WAIVER AND RELEASE OF CLAIMS

     This RELEASE (“Release”) is dated as of                                           between Altra Holdings, Inc., a Delaware corporation, Altra Industrial Motion, Inc., a Delaware corporation and wholly-owned subsidiary of Holdings (collectively, the “Company”), and                      (the “Executive”).

     WHEREAS, the Company and the Executive previously entered into a Change of Control Agreement dated                      ___, 2008 (the “CCA”); and

     WHEREAS, the Executive’s employment with the Company (has been) (will be) terminated effective                      ; and

     WHEREAS, pursuant to Section 3 of the CCA, the Executive is entitled to certain compensation and benefits upon such termination, contingent upon the execution of this Release;

     NOW, THEREFORE, in consideration of the premises and mutual agreements contained herein and in the CCA, the Company and the Executive agree as follows:

     1. The Executive, on behalf of his heirs, estate and beneficiaries, hereby waives all claims against the Company, and any of its subsidiaries or affiliates, and each past or present officer, director, agent, employee, shareholder, and insurer of any such entities, from liability for any claims or damages the Executive may have against it or them relating as of the date this Release is executed, whether known or unknown, including, but not limited to, any alleged violation of the Age Discrimination in Employment Act, as amended, the Older Worker Benefits Protection Act; Title VII of the Civil Rights of 1964, as amended; Sections 1981 through 1988 of Title 42 of the United States Code; the Civil Rights Act of 1991; the Equal Pay Act; the Americans with Disabilities Act; the Rehabilitation Act; the Family and Medical Leave Act; the Employee Retirement Income Security Act of 1974, as amended; the Worker Adjustment and Retraining Notification Act; the Fair Credit Reporting Act; the Occupational Safety and Health Act; the Uniformed Services Employment and Reemployment Act; the Employee Polygraph Protection Act; the Immigration Reform Control Act; the retaliation provisions of the Sarbanes-Oxley Act of 2002; [list applicable Massachusetts laws] (and including any and all amendments to the above) and/or any other alleged violation of any federal, state or local law, regulation or ordinance, and/or contract (including, but not limited to, the CCA) or implied contract or tort law or public policy or whistleblower claim, having any bearing whatsoever on the Executive’s employment by and the termination of employment with the Company, including, but not limited to, any claim for wrongful discharge, back pay, vacation pay, sick pay, bonus payment, attorneys’ fees, costs and/or future wage loss. This paragraph does not release any claims that lawfully cannot be waived.

     Nothing in this Release is intended to preclude the Executive from filing a charge or participating in any investigation or proceeding conducted by the Equal Employment

Opportunity Commission or state fair employment practices agency. The Executive agrees not to seek or accept any money damages or any other relief upon the filing of any such administrative or judicial charges or complaints.

     2. The Executive acknowledges and agrees that even though claims and facts in addition to those now known or believed by him to exist may subsequently be discovered, it is his intention to fully settle and release all claims he may have against the Company and the persons and entities described above, whether known, unknown or suspected.

     3. The Executive relinquishes any right to future employment with the Company and the Company shall have the right to refuse to re-employ the Executive, in each case without liability of the Executive or the Company.

     4. The Company and the Executive acknowledge and agree that the release contained in Paragraph 1 does not, and shall not be construed to, release or limit the scope of any existing obligation of the Company (i) to indemnify the Executive for his acts as an officer or director of Company in accordance with Delaware law and the charter and bylaws of the Company, (ii) to the Executive and his eligible, participating dependents or beneficiaries under any existing group welfare or retirement plan of the Company in which the Executive and/or such dependents are participants, or (iii) to satisfy all vested equity compensation obligations previously granted to the Executive.

     5. The Executive reaffirms his agreement to Section 3 of the CCA relating to restrictive covenants.

     6. The Executive acknowledges that he has been provided at least twenty-one (21) ¹ days to review the Release and has been advised to review it with an attorney of his choice and at his own expense. In the event the Executive elects to sign this Release prior to this twenty-one (21) day period, he agrees that it is a knowing and voluntary waiver of his right to wait the full twenty-one (21) days. The Executive further understands that he has seven (7) days after the signing hereof to revoke it by so notifying the Company in writing, such notice to be received by                      within the seven (7) day period. The Executive further acknowledges that he has carefully read this Release and knows and understands its contents and its binding legal effect. The Executive acknowledge that by signing this Release, he does so of his own free will and act and that it is his intention that he be legally bound by its terms.

     7. This Release shall be construed and enforced in accordance with, and governed by, the laws of the Commonwealth of Massachusetts , without regard to principles of conflict of laws. If any clause of this Release should ever be determined to be unenforceable, it is agreed that this will not affect the enforceability of any other clause or the remainder of this Release.

     IN WITNESS WHEREOF, the parties have executed this Release on the date first above written.

		ALTRA HOLDINGS, INC.
		By: Title:
		ALTRA INDUSTRIAL MOTION, INC.
		By: Title:
		EXECUTIVE
		[Name]

Exhibit B

RESTRICTIVE COVENANTS

1. Confidential Information . Executive acknowledges that the information, observations and data (including without limitation trade secrets, know-how, research plans, business, accounting, distribution and sales methods and systems, sales and profit figures and margins and other technical or business information, business, marketing and sales plans and strategies, cost and pricing structures, and information concerning acquisition opportunities and targets nationwide in or reasonably related to any business or industry in which any of Holdings or the Company or their respective Subsidiaries is engaged) disclosed or otherwise revealed to him, or discovered or otherwise obtained by him or of which he becomes aware, directly or indirectly, while employed by the Company or its Subsidiaries (including, in each case, those obtained prior to the date of this Agreement) concerning the business or affairs of Holdings or the Company or any of their respective Subsidiaries (collectively, “ Confidential Information ”) are the property of Holdings or the Company or their respective Subsidiaries, as the case may be, and agrees that Holdings and Company have a protectable interest in such Confidential Information. Therefore, Executive agrees that he shall not (during his employment with the Company or at any time thereafter) disclose to any unauthorized person or use for his own purposes any Confidential Information without the prior written consent of the Board, unless and to the extent that the aforementioned matters: (a) become or are generally known to and available for use by the public other than as a result of Executive’s acts or omissions or (b) are required to be disclosed by judicial process or law (provided that Executive shall give prompt advance written notice of such requirement to the Company to enable the Company to seek an appropriate protective order or confidential treatment). Executive shall deliver to the Company at the termination of the Employment Period, or at any other time the Company may request, all memoranda, notes, plans, records, reports, computer tapes, printouts and software and other documents and data (and copies thereof) which constitute Confidential Information or Work Product (as defined below) which he may then possess or have under his control.

2. Work Product . Executive hereby assigns to the Company all right, title and interest in and to all inventions, developments, methods, process, designs, analyses, reports and all similar or related information (in each case whether or not patentable), all copyrightable works, all trade secrets, confidential information and know-how, and all other intellectual property rights that both (a) are conceived, reduced to practice, developed or made by Executive while employed by the Company and its Subsidiaries and (b) either (i) relate to the Company’s or any of its Subsidiaries’ actual or anticipated business, research and development or existing or future products or services, or (ii) are conceived, reduced to practice, developed or made using any of equipment, supplies, facilities, assets or resources of the Company or any of its Subsidiaries (including but not limited to, any intellectual property rights) (“ Work Product ”). Executive shall promptly disclose such Work Product to the Board and perform all actions reasonably requested by the Board (whether during or after the Employment Period) to establish and confirm the Company’s ownership of the Work Product (including, without

limitation, executing and delivering assignments, consents, powers of attorney, applications and other instruments).

3. Noncompetition . In further consideration of the compensation to be paid to Executive hereunder, Executive acknowledges that in the course of his employment with the Company and its Subsidiaries he has become and shall become familiar with the Company’s trade secrets and with other Confidential Information concerning the Company and its Subsidiaries and that his services have been and shall be of special, unique and extraordinary value to the Company and its Subsidiaries. Therefore, Executive agrees that, during the period of Executive’s employment with the Company and for 12 months thereafter (the “ Noncompete Period ”), he shall not, without prior written approval by the Board, directly or indirectly (whether for compensation or otherwise) own or hold any interest in, manage, operate, control, consult with, render services for, or in any manner participate in any business which competes in any material respect with the businesses of the Company or its Subsidiaries conducted or proposed to be conducted during the Employment Period (collectively, the “Business”), either as a general or limited partner, proprietor, common or preferred shareholder, officer, director, agent, employee, consultant, trustee, affiliate or otherwise. Executive acknowledges that the Company’s and its Subsidiaries’ businesses are planned to be conducted nationally and internationally and agrees that the provisions in this Paragraph 3 shall operate in the market areas of the United States and outside the United States in which the Company conducts or plans to conduct business on and prior to the Termination Date. Nothing in this Paragraph 3 shall prohibit Executive from being a passive owner of not more than 2% of the outstanding securities of any publicly traded company engaged in the Business, so long as Executive has no active participation in the business of such company.

4. Non-Solicitation . During the Noncompete Period, Executive shall not directly or indirectly through another entity (i) induce or attempt to induce any employee of the Company or any Subsidiary to leave the employ of the Company or such Subsidiary, or in any way interfere with the relationship between the Company or any Subsidiary and any employee thereof, (ii) solicit to hire any person who was an employee of the Company or any Subsidiary at any time during the 12 months preceding the termination of the Employment Period or (iii) induce or attempt to induce any customer, client, member, supplier, licensee, licensor, franchisee or other business relation of the Company or any Subsidiary to cease doing business with the Company or such Subsidiary, or in any way interfere with the relationship between any such customer, client, member, supplier, licensee, licensor, franchisee or business relation and the Company or any Subsidiary (including, without limitation, making any negative statements or communications about the Company or its Subsidiaries).

5. Enforcement . If, at the time of enforcement of any of Paragraphs 1 through 4 , a court of competent jurisdiction shall hold that the period, scope or area restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum period, scope or area reasonable under such circumstances shall be substituted for the stated period, scope or area and that the court shall be allowed and directed to revise the restrictions contained herein to cover the maximum period, scope and area permitted by applicable law. The parties hereto acknowledge and agree that Executive’s services are unique and he has access to Confidential Information and Work Product, that the provisions of Paragraphs 1 through 4 are necessary, reasonable and appropriate for the protection of the legitimate

business interests of Holdings and the Company and their respective Subsidiaries, that irreparable injury will result to Holdings and the Company and their respective Subsidiaries if Executive breaches any of the provisions of Paragraphs 1 through 4 and that money damages would not be an adequate remedy for any breach by Executive of this Agreement and that neither Holdings nor the Company will have any adequate remedy at law for any such breach. Therefore, in the event of a breach or threatened breach of this Agreement, Holdings or the Company or any of their successors or assigns, in addition to other rights and remedies existing in their favor, shall be entitled to specific performance and/or immediate injunctive or other equitable relief from any court of competent jurisdiction in order to enforce or prevent any violations of the provisions hereof (without the necessity of showing actual money damages, or posting a bond or other security). Nothing contained herein shall be construed as prohibiting Holdings or the Company or any of their successors or assigns from pursuing any other remedies available to it for such breach or threatened breach, including the recovery of damages.

6. Executive’s Representations and Acknowledgements . Executive hereby represents and warrants to Holdings and the Company that (i) the execution, delivery and performance of this Agreement by Executive do not and shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which Executive is a party or by which he is bound, (ii) Executive is not a party to or bound by any employment agreement, noncompete agreement or confidentiality agreement with any other Person, (iii) Executive shall not use any confidential information or trade secrets of any third party in connection with the performance of his duties hereunder, and (iv) this Agreement constitutes the valid and binding obligation of Executive, enforceable against Executive in accordance with its terms. Executive hereby acknowledges and represents that he has consulted with independent legal counsel regarding his rights and obligations under this Agreement and that he fully understands the terms and conditions contained herein and intends for such terms and conditions to be binding on and enforceable against Executive. Executive acknowledges and agrees that the provisions of Paragraphs 1 through 4 are in consideration of: (i) Executive’s employment by the Company; and (ii) additional good and valuable consideration as set forth in this Agreement, the receipt and sufficiency of which are hereby acknowledged. Executive expressly agrees and acknowledges that the restrictions contained in Paragraphs 1 through 4 do not preclude Executive from earning a livelihood, nor do they unreasonably impose limitations on Executive’s ability to earn a living. In addition, Executive agrees and acknowledges that the potential harm to the Company of its non-enforcement outweighs any harm to Executive of its enforcement by injunction or otherwise. Executive acknowledges that he has carefully read this Agreement and has given careful consideration to the restraints imposed upon Executive by this Agreement, and is in full accord as to their necessity for the reasonable and proper protection of the Confidential Information. Executive expressly acknowledges and agrees that each and every restraint imposed by this Agreement is reasonable with respect to subject matter, time period and geographical area

Exhibit 10.3

Altra Holdings, Inc.
Executive Severance Policy
Effective November 1, 2008

Plan Document and Summary Plan Description

1. Purpose and Administration .

          The Altra Holdings, Inc. Executive Severance Policy (the “ Policy ” or “ Plan ”) became effective November 1, 2008 (the “ Effective Date ”) following approval by the Personnel and Compensation Committee (the “ Committee ”) of the Board of Directors (the “ Board ”) of Altra Holdings, Inc. (the “ Company ”). The Policy is intended to provide certain executives of the Company who are in a position to contribute materially to the success of the Company with Severance Benefits if they are separated from employment with the Company as set forth herein.

          The Company shall have sole authority in its sole and absolute discretion to interpret, apply and administer the terms of the Plan and to determine eligibility for and the amounts of benefits under the Plan, including the interpretation of ambiguous Plan provisions, determination of disputed facts or application of Plan provisions to anticipated circumstances, in each case, in its sole and absolute discretion. The Company’s decision on any such matter in its sole and absolute discretion shall be final and binding. The Company is both the Plan Sponsor and Plan Administrator of the Plan for purposes of ERISA and shall have responsibility for complying with any ERISA reporting and disclosure rules applicable to the Plan. The Plan Administrator may at any time delegate any other named person or body, or reassume therefrom, any of its fiduciary responsibilities or administrative duties with respect to the Plan. The Company is also the named fiduciary of the Plan within the meaning of ERISA, with the power to act in its sole and absolute discretion with respect to the review of claims for benefits under the Plan that are denied. The Company may contract with one or more persons to render advice or services with respect to any responsibility it has under the Plan. Subject to the limitations of the Plan, the Company shall from time to time establish such rules, regulations or guidelines as it may determine are necessary or appropriate for the operation and administration of the Plan.

2. Definitions .

          As used in this Policy, the following terms shall have the respective meanings set forth below:

a. “Cause” means (i) Participant’s material breach of the terms of any agreement between Participant and the Company; (ii) Participant’s willful failure or refusal to perform his or her material duties required pursuant to his or her employment; (iii) Participant’s willful insubordination or disregard of the legal directives of the Board, or any senior executive to whom Participant reports, which are not inconsistent with the scope, ethics and nature of Participant’s duties and responsibilities; (iv) Participant’s engaging in misconduct which has a material adverse impact on the reputation, business, business relationships or financial condition of the Company; (v) Participant’s commission of an act of fraud or embezzlement against the Company or any of its subsidiaries; or (vi) any conviction of, or plea of guilty or nolo contendere by, Participant with respect to a felony (other than a traffic violation), a crime involving moral turpitude, fraud or misrepresentation; provided, however, that Cause shall not be deemed to exist under any of clauses (i), (ii) or (iii) unless Participant has been given reasonably detailed written notice of the grounds for such Cause and Participant has not effected a cure within twenty (20) days of the date of receipt of such notice.

b. “Code” means the Internal Revenue Code of 1986, as amended.

c. “Company” means Altra Holdings, Inc. and its affiliates including its wholly owned subsidiary Altra Industrial Motion, Inc., or any successor to those entities. For purposes of this Policy, the term “affiliate” means any entity controlling, controlled by, or under common control with the Company.

d. “Date of Termination” means (i) the effective date on which the Participant’s employment by the Company terminates pursuant to a Qualifying Separation as specified in a prior written notice by the Company or the Participant, as the case may be, to the other, or (ii) if the Participant’s employment by the Company terminates by reason of death, the date of death of the Participant.

e. “Disability” means that at the time the Participant’s employment is terminated, he or she has been unable to perform the duties of his/her position for a period of six consecutive months as a result of the Participant’s inability due to physical or mental illness.

f. “Participant” means each of the senior executives of the Company who are selected by the Committee for coverage by this Policy. As of the adoption date of the Policy, Participants shall include the officers and executives set forth on Appendix A. The Committee and/or the Board shall have the ability to amend Appendix A to add or remove Participants at its discretion.

g. “Plan” means the Altra Holdings, Inc. Executive Severance Policy, effective November 1, 2008.

h. “Plan Administrator” means Altra Holdings, Inc.

i. “Qualifying Separation” means a termination of employment (within the meaning of “separation from service,” as defined in Section 1.409A-1(h) of the Final Treasury Regulations) from the Company (and its affiliates) but specifically excludes, without limitation, termination of employment due to Cause, death, Disability, or termination by the Participant.

j. “Separation Agreement” means an effective agreement prepared by the Company, executed by the Participant and returned to the Company within the time period requested by the Company. It shall contain (a) typical provisions concerning termination of employment (including, without limitation, provisions regarding noncompetition, nonsolicitation, nondisparagement and confidential and proprietary information), (b) a statement that Severance Benefits under this Policy are conditioned upon the Company’s receipt of such agreement, and (c) a release (in a form to be determined by the Company) by the Participant of the Company from any liability or obligation (excluding any indemnification to which the Participant may be entitled pursuant to the Company’s Amended and Restated Certificate of Incorporation, By-Laws and any coverage under directors and officers, professional, fiduciary or errors or omissions policies that benefit the Participant) to the Participant. To be effective, the Separation Agreement shall not have been revoked by the Participant within the time permitted under applicable state and federal laws.

k. “Severance Benefits” mean the benefits set forth in Section 4.

l. “Severance Pay” means the salary continuation payments under Section 4 of this Policy.

3. Eligibility .

          This Policy applies to the Participants as defined herein and supersedes and replaces all other policies and plans with respect to severance. Notwithstanding the foregoing, in the event a Participant enters into a written agreement with the Company regarding severance, including without limitation a change in control agreement, the terms and conditions of such written agreement shall control with respect to the circumstances covered by such agreement. For avoidance of doubt, in the event a Participant incurs a Qualifying Separation not covered by the express terms of any written agreement with the Company (e.g., a Qualifying Separation not covered by a Change in Control Agreement), Participant shall continue to be eligible to receive benefits under this Policy.

4. Severance Benefits .

          The Company will, subject to the terms of the Policy, provide severance benefits as set forth in this Section 4 to all Participants who have experienced a Qualifying Separation from the Company

	a.		Severance Pay . The Company will continue to pay to Participant his or her regular annual base salary as in effect on Participant’s last day of employment (“ Base Salary ”) for a period of twelve (12) months following the Date of Termination or until commencement of new employment, whichever is earlier (“ Severance Period ”). Notwithstanding the foregoing, during the applicable revocation period of a Participant’s Separation Agreement, the severance payments that would otherwise have been paid during such time shall be paid as soon as administratively feasible following the lapsing of such revocation period. Subject to the foregoing, the Company shall pay to the Participant severance on regular paydays of the Company to the extent administratively feasible. The Severance Pay will be made less applicable withholdings and deductions.
	b.		Medical and Dental Benefits . The Company will continue to provide Participant, for a period of twelve (12) months following the Date of Termination or until commencement of new employment providing substantially similar benefits, whichever is earlier, with coverage under the Company’s group medical and dental insurance plans, provided the Company is able to provide such benefits to Participant under its existing plans and arrangements. Participant shall continue to contribute his or her portion of the premium for such benefits,

			deducted via payroll. Upon completion of the 12 month period, Participant shall be eligible for COBRA continuation, at full cost to the Participant.
	c.		Equity Awards . The rights regarding the Participant’s equity awards shall continue to be governed by the agreements, instruments and stock plan governing such equity awards.
	d.		Separation Agreement . A Participant must execute an effective Separation Agreement (a form of which is attached hereto as Appendix B) within 30 days of a Qualifying Separation in order to receive Severance Benefits. Severance Benefits shall cease upon the Participant violating any provision of his or her Separation Agreement, or any post-termination obligations under his or her employment agreement (if any).

5. Non-Exclusivity of Rights .

          The terms of this Policy shall not prevent or limit the right of a Participant to receive, prior to a Qualifying Separation, any base salary, retirement or welfare benefit, perquisite, bonus or other payment provided by the Company to the Participant, except for such rights as the Participant may have specifically waived in writing. Amounts that are vested benefits or which the Participant is otherwise entitled to receive under any other benefit, policy or program provided by the Company shall be payable in accordance with the terms of such policy or program.

6. Amendment; Termination .

          This Policy, including the designation of those who qualify as Participants, may be amended or terminated by the Committee at any time. No such termination or amendment shall affect the rights of any Participant whose employment has been terminated as a result of a Qualifying Separation, or who is then receiving Severance Benefits at the time of such amendment or termination. If a Participant dies after signing the Separation Agreement and prior to receiving all of the Severance Pay to which he or she is entitled pursuant to the Policy, payment shall be made to the beneficiary designated by the Participant to the Company or, in the event of no designation of beneficiary or the death of the beneficiary, then to the estate of the deceased Participant.

7. 409A Compliance .

          Each payment under the Plan shall be treated as a separate payment under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the treasury regulations and other guidance promulgated or issued thereunder (“Section 409A”). Notwithstanding the foregoing, if all or any portion of the severance payment and/or benefits due under the Plan are determined to be “non-qualified deferred compensation” subject to Section 409A and the Company determines that the Participant is a “specified employee” (as defined in Section 409A(a)(2)(B)(i) of the Code and the other guidance promulgated thereunder), then such severance payment and/or benefits shall commence no earlier than the first day of the seventh month following Participant’s termination of employment. Any payment or benefit delayed by reason of the prior sentence shall be paid in a single lump sum on the first day immediately following the end of such required delay period in order to catch up to the original payment schedule.

8. Non-Assignability .

          Severance Benefits pursuant to the Policy shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or charge prior to actual receipt thereof by a Participant; and any attempt to so anticipate, alienate, sell, transfer, assign, pledge, encumber or charge prior to such receipt shall be void; and the Company shall not be liable in any manner for, or subject to, the debts, contracts, liabilities, engagements or torts of any person entitled to any Severance Benefits under this Policy.

9. No Employment Rights .

          This Policy does not constitute a contract of employment for a particular term or length between any Participant and the Company, nor does it in any way alter any Participant’s status as an employee-at-will who may be terminated with or without cause for any reason or no reason at all except a reason prohibited by law.

10. Governing Law .

          The terms of the Policy, to the extent not preempted by federal law, shall be governed by and construed and enforced in accordance with the laws of the Commonwealth of Massachusetts (without regard to its conflict of laws principles) including all matters of construction, validity and performance.

11. ERISA Rights .

          The Plan is an “employee welfare benefit plan” subject to the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”). Any employee or former employee of the Company who believes that he or she has not been provided with benefits otherwise due under the Plan are “participants” of the Plan. Participants in the Severance Plan are entitled to certain rights and protections under ERISA. ERISA provides that all employee welfare benefit plan participants shall be entitled to:

(a)

Receive Information About the Plan and its Benefits .

	(i)		Examine, without charge, at the Company’s locations, all documents governing the Plan, including the updated Plan Document and Summary Plan Description and a copy of the latest annual report (Form 5500 Series) filed by the plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration.
	(ii)		Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the plan, including the updated Plan Document and Summary Plan Description and copies of the latest annual report (Form 5500 Series). The Plan Administrator may make a reasonable charge for the copies.

	(b)		Prudent Actions by Plan Fiduciaries . In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called ``fiduciaries’’ of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants. No one, including the Company or its employees, may discriminate against a participant in any way to prevent a participant from obtaining a benefit or exercising his or her rights under ERISA.
	(c)		Participants’ Rights .

	(i)		If a participant’s claim for severance benefit is denied or ignored, in whole or in part, the participant has a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules, pursuant to the Claims Procedures given below.
	(ii)		Under ERISA, there are steps a participant can take to enforce the above rights. For instance, if the participant requests a copy of Plan documents or the latest Form 5500s from the Plan and does not receive them within 30 days, the participant may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay the participant up to $110 a day until he or she receives the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If a participant has a claim for benefits which is denied or ignored, in whole or in part, the participant may file suit in a state or Federal court. If it should happen that a participant is discriminated against for asserting his or her rights, the participant may seek assistance from the U.S. Department of Labor, or he or she may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If the participant is successful, the court may order the person the participant had sued to pay the costs and fees. If the participant loses, the court may order the participant to pay the costs and fees, for example, if it finds that the participant’s claim is frivolous.

(d)

Assistance with Participants’ Questions . If a participant has any questions about the Plan, the participant should contact the Plan Administrator. If a participant has any questions about his or her rights under ERISA, or if a participant needs assistance in obtaining documents from the Plan Administrator, the participant should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in the telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue

N.W., Washington, D.C. 20210. A participant may also obtain certain publications about his or her rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration.

12. Claims Procedure .

          If an employee or former employee believes that he or she has not been provided with benefits otherwise due under the Plan, then the employee or former employee (“Claimant”) may file a claim for benefits (“ Claim ”) under this procedure with the Company’s Human Resources Department at Altra Holdings, Inc., 14 Hayward Street, Quincy, Massachusetts 02171 or its delegate. Such Claim must be made within ninety (90) days after the date the Claimant knows or should have known that he/she is not entitled to benefits under the Plan. Upon submitting a Claim, the Claimant may (1) submit written comments, documents, records, and other information relevant to his or her claim and (2) obtain, upon request and free of charge, reasonable access to and copies of all documents, records and other information relevant to his or her claim. Normally, upon receipt of a Claim, the Plan Administrator will provide written notice of its decision on the Claim within ninety (90) days. However, if special circumstances require additional time, the Claimant will be notified of that fact within ninety (90) days, and the Plan Administrator will make a decision on the Claim within one hundred eighty (180) days of the date the Claimant’s Claim was received. If no decision is provided within the ninety (90)- or one hundred eighty (180)-day periods described in this paragraph, the Claim will be deemed to have been denied.

(i)

If a Claimant makes such Claim and the Plan Administrator denies the Claim in whole or in part, the Plan Administrator shall give the Claimant written notice of such decision setting forth the following:

	(A)		The specific reason or reasons for the denial;
	(B)		References to the specific Plan provisions on which the decision was based;
	(C)		A description of any additional material or information required to make the Claimant’s Claim acceptable, with a statement of why such material or information is required;
	(D)		A description of the Plan’s procedures, and the time limits applicable to those procedures, to follow if the Claimant wishes to have the denied Claim reviewed;
	(E)		Notice that the Claimant may obtain free of charge, copies of all documents, records and other information relevant to the Claimant’s Claim; and
	(F)		A statement that the Claimant has the right to bring a civil action under section 502(a) of ERISA following an adverse benefit determination on review.

	(ii)		Any Claimant may appeal a determination or denial of a Claim for benefits as described in (a) above by making a written request to the Plan Administrator for such a review within sixty (60) days after the Claimant receives notice that the Claim has been denied (or within sixty (60) days after the date the Claim is deemed denied) in whole or in part (“Appeal”). Such Appeal should set forth all of the grounds upon which the Appeal is based and any facts in support thereof, and should set forth any issues or comments which the Claimant deems relevant to the Appeal.
	(iii)		Upon submitting an Appeal, the Claimant may submit written comments, documents, records, and other information relevant to his or her Appeal. The Plan Administrator shall take such submissions into account in rendering a decision on the Appeal without regard to whether such information was submitted or considered in the initial benefit determination.
	(iv)		Additionally, in reviewing the Appeal, the Plan Administrator may require the Claimant to submit, within ten (10) days of its written notice, such additional facts, documents or other evidence as the Plan Administrator in its sole discretion deems necessary or advisable in making its review.
	(v)		The Plan Administrator will review Claimant’s Appeal and normally will notify the Claimant of its final decision within sixty (60) days after it receives Claimant’s Appeal. However, in special circumstances, the Plan Administrator may need additional time to make a final decision. By notifying the Claimant of such special circumstances that require additional time, and of the date

			by which the decision can be expected, the Plan Administrator may take up to an additional sixty (60) days (for a total of one hundred twenty (120) days) to make a decision regarding the Appeal. If no decision is reported within the sixty (60)- or one hundred twenty (120)-day periods described in this paragraph, the initial denial of the claim will be deemed to have been affirmed. The decision of the Plan Administrator on any Appeal shall be final and conclusive upon all persons if supported by substantial evidence.
	(vi)		The period of time within which a final decision related to the Appeal is required to be made shall begin at the time an Appeal is filed in accordance with the procedures of the Plan, without regard to whether all the information necessary to make such decision accompanies the filing. In the event that a period of time is extended as permitted due to a Claimant’s failure to submit information necessary to decide a Appeal, the period for making a final decision regarding the Appeal shall be tolled from the date on which the notification of the extension is sent to the Claimant until the date on which the Claimant responds to the request for additional information.
	(vii)		If the Plan Administrator denies a Claimant’s Appeal in whole or in part, the Plan Administrator shall give the Claimant written notice of the final decision setting forth the following:

	(A)		The specific reason or reasons for the denial;
	(B)		References to the specific Plan provisions on which the decision was based;
	(C)		A statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of, all documents, records, and other information relevant to the Claimant’s Appeal; and
	(D)		A statement of the Claimant’s right to bring a civil action under section 502(a) of ERISA.

			A Claimant or his or her legal representative may further appeal the Plan Administrator’s final decision by filing an action in a federal court of competent jurisdiction, provided that such action is filed no later than ninety (90) days after receipt of a final decision by the Claimant or his or her legal representative. The agent for service of process in connection with the Plan is the Director of Human Resources located at Altra Holdings, Inc., 14 Hayward Street, Quincy, Massachusetts 02171, and legal process can also be served on the Plan Administrator at the same address.
	(viii)		Notwithstanding the above, completion of the claims procedures described in this Section 12 is a condition precedent to the commencement of any legal or equitable action in connection with a claim for benefits under the Plan by a Claimant or any other individual or entity, unless the Plan Administrator, in its sole discretion, waives compliance with such Claim procedures as a condition precedent

      13.  Miscellaneous .

          a. Taxes and Withholding . As a condition to any payment or distribution pursuant to the Policy, the Company may require a Participant to pay such sum to the Company as may be necessary to discharge its obligations with respect to any taxes, assessments or other governmental charges imposed on property or income received by the Participant thereunder. The Company may deduct or withhold such sum from any payment or distribution to the Participant.

          b. Right to Offset . Notwithstanding any provisions of the Policy to the contrary, the Company may offset any amounts to be paid to a Participant (or, in the event of the Participant’s death, to his beneficiary or estate) under the Policy against any amounts that such Participant may owe to the Company.

          c. Severability . If any provision of the Policy is determined to be invalid, illegal or unenforceable, such provision shall be construed or deemed amended to conform to applicable laws, or, if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Policy, such provision shall be stricken, and the remainder of the Policy shall remain in full force and effect.

14. Important Information About the Plan .

	•		The Plan is established and maintained by Altra Holdings, Inc.
	•		The Employer Identification Number (EIN) is 61-1478870.
	•		The Plan Number is 501.
	•		The Plan is administered directly by the Plan Administrator. The Plan Administrator has the authority to control and manage the operation of the Plan. The Plan Administrator may terminate, suspend, withdraw or amend the Plan, in whole or in part, at any time, subject to the applicable provisions of the Plan.
	•		The Plan Administrator is: Altra Holdings, Inc. 14 Hayward Street Quincy, MA 02171
	•		The agent for service of legal process is Altra Holdings, Inc.
	•		The Plan of benefits is financed by the Employer.
	•		The date of the end of the Plan Year is December 31, 2008.

Appendix A

The Participants under the Policy shall include the following officers and executives of the Company:

1.		VPGM Gearing and Belted Drives
2.		VPGM Global Couplings
3.		VPGM Electric Clutch Brakes
4.		VPGM Bearings and Overrunning clutches
5.		VPGM Heavy Duty Clutch Brakes
6.		VP Global Sales
7.		VP Marketing and Business Development
8.		VP Human Resources
9.		VP and General Counsel
10.		VP Finance

Appendix B

SEPARATION AGREEMENT

     THIS AGREEMENT, made and entered into this the ___day of                      , 200_, by and between Altra Holdings, Inc. (hereinafter referred to as “the Company”) and                                           , (hereinafter referred to as “the Employee”):

     WHEREAS the Employee and the Company agree that as of [Date] , (hereinafter referred to as the “Effective Date”) the employment relationship between them will terminate, and this Agreement will become effective as set forth herein;

     WHEREAS the Employee and the Company agree that it is in the best interest of each that the terms and conditions of the Employee’s termination of employment be expressly set forth and that the severance payments and benefits to be provided by the Company be similarly set forth; and,

     NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter made by the Employee and the Company and for other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged by the Employee and the Company, it is agreed that:

	1.		As of the Effective Date the Employee will perform no further services for the Company, and his status as an employee of the Company will cease.
	2.		After the Effective Date the Company shall provide the following payments and benefits to the Employee:

	a.		Executive Severance Policy Benefits Exchanged Contingent upon the Employee’s Execution of this Severance Agreement and Release
			Upon execution of this Waiver and Release, the Company will provide Employee with Severance Pay as described in the Executive Severance Policy effective as of November 1, 2008. The Company will pay the severance as salary continuation, payable immediately following the Revocation Period described below in paragraph 6(c). Required tax and other withholdings shall be deducted from such payment.
	b.		Medical and Dental Benefits
			Upon execution of this Waiver and Release, the Company will continue to provide Employee with medical and dental benefits as described in the Executive Severance Policy effective as of November 1, 2008.

3.

In consideration of the Company’s agreement to provide the Employee with the payments and benefits listed in Paragraph 2, Employee, his heirs, executors, legal representative, administrators, successors and assigns, fully discharges, releases the Company (including its officers, directors, managers, supervisors, and or agents), and any parent or affiliated companies (including their officers, directors, managers, supervisors, or agents), as to all administrative charges, lawsuits, causes of action, employment contracts, demands, and claims for damages whatsoever that he now has or now may have in law or equity, including, but not limited to, all claims pertaining to or arising out of his employment, any term, condition or privilege of his employment, or the termination of his employment, and any claims arising under any state of federal statutory or common law, such as Title VII or the Civil Rights Act of 1964 (“Title VII”), 42 U.S.C.§ 2000e, et seq .; the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C.§§ 621-634; the Americans With Disabilities Act (“ADA”), 42 U.S.C.§ 12101 et seq .; the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C.§ 1001 et seq .; the Consolidated Omnibus Budget

Reconciliation Act (“COBRA”), 29 U.S.C. § 1161 et seq .; wage payment laws, and common law claims of wrongful termination, personal injury, breach of contract, or other wrongful act or omission. This Agreement is not intended to waive any claims that may arise after the date the Agreement is executed.

	4.		The parties agree that the Company had no prior legal obligation to make the additional payments that have been exchanged for the promises made by Employee in this Agreement.
	5.		Employee acknowledges that he possesses sufficient education and experience to fully understand the terms of this Agreement as it has been written, the legal and binding effect of this Agreement, and the exchange of benefits and payments for promises hereunder.
	6.		Notification under the Older Workers Benefit Protection Act

	a.		Time to consider this Agreement . Employee acknowledges that he has been provided with a copy of this Agreement and has been given twenty-one (21) consecutive days in which to review and consider the Agreement.
	b.		Legal counsel. Employee is advised by the Company to consult with legal counsel and to seek a clarification of any of the terms of the Agreement prior to signing this Agreement.
	c.		Revocation . The Employee acknowledges that he has a period of seven (7) calendar days following his signing of this Agreement to revoke this Agreement (the “Revocation Period”). Any such revocation of the Agreement must be made by the Employee and delivered to the CFO of TB Wood’s Incorporated, Chambersburg, PA . Any revocation hereunder shall not affect the Company’s termination of the Employee’s employment.
	d.		When the terms become effective . The terms of the Agreement shall become final and binding only upon expiration of the Revocation Period provided in subparagraph 6(c) above. No payments shall be made under paragraph 2(a) until the Agreement becomes final and binding upon the parties.

	7.		The Employee agrees that the only consideration for signing this Agreement are the terms stated or identified in this Agreement or its attachments and that no other promises or assurances of any kind have been made to him by the Company, its attorneys, or any other person as an inducement to sign this Agreement. Therefore, this Agreement, together with its exhibits and attachments, constitutes the entire understanding of the parties, and no representation, promise, or inducement not included herein shall be binding on the parties.
	8.		The Employee understands and agrees that the Company’s obligation to perform under this Agreement is conditioned upon the Employee’s performance of all agreements, releases, and covenants to the Company as set forth herein.
	9.		The Agreement shall inure to and be binding upon the parties hereto, their respective heirs, legal representative, successors, and assigns.
	10.		This Agreement shall be construed in accordance with the laws of the Commonwealth of Massachusetts, except where federal law may apply.
	11.		This Agreement does not constitute an admission of any wrongdoing by the Company.
	12.		The parties agree that the provisions of this Agreement shall be deemed severable and that the invalidity or unenforceability of any portion of any provision shall not affect the validity or

			enforceability of other portions of such provisions. Such provisions shall be appropriately limited and given effect to the extent that they may be enforceable.
	13.		This Agreement may not be changed orally, but only by a subsequent agreement in writing signed by the parties.
	14.		Employee agrees to retain in strict confidence and not to use for any purpose whatsoever or divulge, disseminate or disclose to any third party any proprietary, financial or other confidential information relating to the Company, its business, or its business records that Employee may recall from his employment with the Company. The Employee further agrees that the provisions of this Agreement are confidential and that the terms of this Agreement, including but not limited to the amount of any payments made as outlined in paragraph 2 above, will not be divulged or disclosed in any manner whatsoever to any person other than his attorney in a legally recognized privileged communication; except that the Employee may communicate the terms of this Agreement to his accountant or tax return preparer to the extent necessary in preparing his [ 200_] tax return or to receive relevant tax advice, and to members of his immediate family, but Employee shall be responsible for any disclosures by such persons as though they were made by him. Employee also may make such disclosures as are required by a valid, enforceable subpoena, a court of law with jurisdiction to compel Employee’s testimony, or any governmental body with authority to compel Employee to answer questions about the Agreement. The Employee agrees that this paragraph is a material provision of their Agreement and that a breach of this term will release Company from any further obligation under the Agreement and entitle the Company to recover all monetary consideration furnished by the Company pursuant to this Agreement and any other damages that it may establish.
	15.		The Employee further states that he has carefully read this Agreement, knows the contents thereof, has had the opportunity to consult legal counsel if he so wishes, and signs the same of his own free act.
	16.		The Employee agrees to refrain from making any derogatory comments to any member of the media or any other public comment to any other third party concerning the Company or any current or former officers, employees, directors, shareholders or affiliates (including, without limitation, its parent corporation) of the Company. In consideration of the foregoing, the Company agrees to refrain from making any derogatory comment about the Employee to any third party (including, without limitation, any prospective employer) and shall provide oral references upon request and a mutually agreed upon letter of reference.
	17.		It is understood and agreed that all files, papers, memoranda, letters, handbooks and manuals, facsimile or other communications that were written, authorized, signed, received or transmitted during or prior to Employee’s employment and any Company property (including, without limitation, any computer hardware or software, or other communications equipment) in Employee’s possession are and remain the property of the Company and, as such, are not to be removed from the Company’s offices. In addition, any such materials or property which may be in Employee’s possession, but which are not in the Company’s offices, are to be returned.
	18.		In consideration of the Company’s agreement to provide the Employee with the payments and benefits listed in Paragraph 2, Employee covenants and agrees for a period of twelve months (12) from the Effective Date of this Agreement not to directly or indirectly enter into the employ of or assist in any manner (including but not limited to acting as a consultant, independent sales representative or distributor, with the exception of an established, multi-line distributor) any direct competitor to the Company.
	19.		In consideration of the Company’s agreement to provide the Employee with the payments and benefits listed in Paragraph 2, Employee covenants and agrees for a period of twelve (12) months from the Effective Date of the Agreement not to, for himself or any person, firm, partnership, corporation, or other entity, (a) solicit, interfere with, or endeavor to cause any Employee to leave the employment of the Company, or (b) induce or attempt to induce any such Employee to breach an employment agreement with the Company.

[Remainder of page intentionally blank]

           IN WITNESS WHEREOF , the parties hereby execute this Agreement as follows:

Acknowledged and Accepted:
		Name						Date
For the Company:
		By:						Date
				Its: