Abe, that looks like an OMC 5.0 2BBL stringer drive set up. Now for the bad news, if that is a stringer drive(named by the way the engine attaches to the stringers not to the transom) they wern't very good when the were brand new, part are hard to find and they usually don't last long. OMC wouldn't put a 5.7 in front of them because it wouldn't take the power. Before you start on the engine, check the drive out. If it has a small anode( square aluminum thing) in the drive housing above the anti-ventalation plate(look above the prop), you have a mechanical shift, they were fair, they can last if taken care of. If it doesn't have the anode, its a hydramechanical drive, they were so bad, that OMC stopped making them after three years, they offered an exchange program for the newer mechanical drives to repalce the hydramechanical ones, I've built two of them(long time ago), they worked when I got thru, don't know how long they lasted. After you determine what kind of drive you have, check the gear lube, if it is full of water(milky looking) stop right there, don't spend any more without having a tech look at it, there are three plaes to check gear lube, one in the lower unit(drain screw), one in the upper unit, has a screw in teh top or on the side, one in the intermediate housing, right up to that rubber boot on top, look for signs of water, rust or metal. Then look under the drive at the ball gears(looks kinda like a weird door knob, or some kind of cog gear), they will be worn, if the appear to more that 50 % missing, you're going to need them. Check the drive part out first, then move on to the motor. Don't spend any big buck till you evaluate the whole package. I'll tell you about the wrong distributor later.