Exhibit 10.2


 


REVOLVING LINE OF CREDIT NOTE


 


 


	$25,000,000.00	Davenport, Iowa

June 27, 2014


 


FOR VALUE RECEIVED, the undersigned FLEXSTEEL INDUSTRIES,
INC. (“Borrower”) promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”) at its office
at 203 West 3rd Street, 4th Floor, MAC N8236-043, Davenport, Iowa 52801-1901, or at such other place as the
holder hereof may designate, in lawful money of the United States of America and in immediately available funds, the principal
sum of Twenty-Five Million Dollars ($25,000,000.00), or so much thereof as may be advanced and be outstanding, with interest thereon,
to be computed on each advance from the date of its disbursement as set forth herein.


 


DEFINITIONS:


 


As used herein, the following terms shall have the meanings
set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined:


 


(a)      “Daily One Month
LIBOR” means, for any day, the rate of interest equal to LIBOR then in effect for delivery for a one (1) month period.


 


(b)      “LIBOR”
means the rate of interest per annum determined by Bank based on the rate for United States dollar deposits for delivery of funds
for one (1) month as reported on Reuters Screen LIBOR01 page (or any successor page) at approximately 11:00 a.m., London time,
or, for any day not a London Business Day, the immediately preceding London Business Day (or if not so reported, then as determined
by Bank from another recognized source or interbank quotation).


 


(c)      “London Business
Day” means any day that is a day for trading by and between banks in Dollar deposits in the London interbank market.


 


INTEREST:


 


(a)      Interest.  The
outstanding principal balance of this Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) at
a fluctuating rate per annum determined by Bank to be one percent (1.00%) above Daily One Month LIBOR in effect from time to time.
Bank is hereby authorized to note the date and interest rate applicable to this Note and any payments made thereon on Bank’s books
and records (either manually or by electronic entry) and/or on any schedule attached to this Note, which notations shall be prima
facie evidence of the accuracy of the information noted.


 


(b)      Taxes and Regulatory
Costs.  Borrower shall pay to Bank immediately upon demand, in addition to any other amounts due or to become due
hereunder, any and all (i) withholdings, interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes)
imposed by any domestic or foreign governmental authority and related in any manner to LIBOR, and (ii) costs, expenses and liabilities
arising from or in connection with reserve percentages prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for “Eurocurrency Liabilities” (as defined in Regulation D of the Federal Reserve Board, as amended), assessment
rates imposed by the Federal Deposit Insurance Corporation, or similar requirements or costs imposed by any domestic or foreign
governmental authority or resulting from compliance by Bank with any request or directive (whether or not having the force of law)
from any central bank or other governmental authority and related in any manner to LIBOR. In determining which of the foregoing
are attributable to any LIBOR option available to Borrower hereunder, any reasonable allocation made by Bank among its operations
shall be conclusive and binding upon Borrower.


 




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(c)      Payment of Interest.  Interest
accrued on this Note shall be payable on the last day of each month, commencing June 30, 2014.


 


(d)      Default Interest.  From
and after the maturity date of this Note, or such earlier date as all principal owing hereunder becomes due and payable by acceleration
or otherwise, or at Bank’s option upon the occurrence, and during the continuance of an Event of Default, the outstanding principal
balance of this Note shall bear interest at an increased rate per annum (computed on the basis of a 360-day year, actual days elapsed)
equal to four percent (4%) above the rate of interest from time to time applicable to this Note.


 


BORROWING AND REPAYMENT:


 


(a)      Borrowing and Repayment.  Borrower
may from time to time during the term of this Note borrow, partially or wholly repay its outstanding borrowings, and reborrow,
subject to all of the limitations, terms and conditions of this Note and of any document executed in connection with or governing
this Note; provided however, that the total outstanding borrowings under this Note shall not at any time exceed the principal amount
stated above. The unpaid principal balance of this obligation at any time shall be the total amounts advanced hereunder by the
holder hereof less the amount of principal payments made hereon by or for Borrower, which balance may be endorsed hereon from time
to time by the holder. The outstanding principal balance of this Note shall be due and payable in full on June 30, 2016.


 


(b)      Advances.  Advances
hereunder, to the total amount of the principal sum stated above, may be made by the holder at the oral or written request of (i)
the Borrower’s President, CEO, CFO, Director of Financial Reporting and Compliance or Treasury Administrator, any one acting
alone, who are authorized to request advances and direct the disposition of any advances until written notice of the revocation
of such authority is received by the holder at the office designated above, or (ii) any person, with respect to advances deposited
to the credit of any deposit account of Borrower, which advances, when so deposited, shall be conclusively presumed to have been
made to or for the benefit of Borrower regardless of the fact that persons other than those authorized to request advances may
have authority to draw against such account. The holder shall have no obligation to determine whether any person requesting an
advance is or has been authorized by Borrower.


 


(c)      Application of
Payments.  Each payment made on this Note shall be credited first, to any interest then due and second, to the outstanding
principal balance hereof.


 


EVENTS OF DEFAULT:


 


This Note is made pursuant to and is subject to the terms
and conditions of that certain Credit Agreement between Borrower and Bank dated as of April 14, 2010, as amended from time to time
(the “Credit Agreement”). Any default in the payment or performance of any obligation under this Note, or any defined
event of default under the Credit Agreement, shall constitute an “Event of Default” under this Note.




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MISCELLANEOUS:


 


(a)      Remedies.  Upon
the occurrence of any Event of Default, the holder of this Note, at the holder’s option, may declare all sums of principal and
interest outstanding hereunder to be immediately due and payable without presentment, demand, notice of nonperformance, notice
of protest, protest or notice of dishonor, all of which are expressly waived by Borrower, and the obligation, if any, of the holder
to extend any further credit hereunder shall immediately cease and terminate. Borrower shall pay to the holder immediately upon
demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include
outside counsel fees and all allocated costs of the holder’s in-house counsel), expended or incurred by the holder in connection
with the enforcement of the holder’s rights and/or the collection of any amounts which become due to the holder under this Note,
and the prosecution or defense of any action in any way related to this Note, including without limitation, any action for declaratory
relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing
incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter
or motion brought by Bank or any other person) relating to Borrower or any other person or entity.


 


(b)      Obligations Joint
and Several.  Should more than one person or entity sign this Note as a Borrower, the obligations of each such Borrower
shall be joint and several.


 


(c)      Governing Law.  This
Note shall be governed by and construed in accordance with the laws of the State of Iowa.


 


(d)      Acknowledgment.  Borrower
acknowledges receipt of a copy of this Note signed by Borrower.


 


IMPORTANT:  READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD
BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN
CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT. THIS NOTICE ALSO
APPLIES TO ANY OTHER CREDIT AGREEMENTS NOW IN EFFECT BETWEEN YOU AND THIS LENDER.


 


IN WITNESS WHEREOF, the undersigned has executed this Note
as of the date first written above.


 





	 	 	 	 
	FLEXSTEEL INDUSTRIES, INC.	 	 
	 	 	 	 	 
	By:  	/s/ Timothy E. Hall	 	 	 
	 	TIMOTHY E. HALL, SR. VP FINANCE, 

CFO, SECRETARY, TREASURER	 	 	 


 


 


 





 






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