Execution Copy




 


Supplemental
Agreement


 


to the


 


EUR 590,000,000


 


Multicurrency Revolving Credit and
Bank Guarantee Facilities Agreement


 


between


 


Elster Group SE


 


as Company and Original Borrower


 


Certain Subsidiaries of the Company


 


as Original Borrowers and Original Guarantors


 


and


 


ING Bank N.V., Frankfurt Branch

Mizuho Corporate Bank, Ltd.


UniCredit Bank AG

as Coordinating Mandated Lead Arrangers


 


Commerzbank Aktiengesellschaft, Filiale
Luxemburg

as Facility Agent


 


UniCredit Bank AG

as Bank Guarantee Agent


 


and


Others


 





 



    	



    	Execution Copy



    

 


THIS SUPPLEMENTAL AGREEMENT is dated 9
May 2011 and made between:


 


		(1)	Elster Group SE (the "Company") as original borrower for itself and as
Obligor's Agent on behalf each of the other Obligors; and



 


		(2)	Commerzbank Aktiengesellschaft,
Filiale Luxemburg as facility agent (the "Facility Agent") for itself and on behalf of each of the
other Finance Parties.



 


WHEREAS:


 


		(A)	Pursuant to a EUR 590,000,000 multicurrency revolving credit and bank guarantee facilities agreement
dated 8 April 2011 between, inter alia, the Company as original borrower and original guarantor, certain subsidiaries of the Company
as original borrowers and/or original guarantors, ING Bank N.V., Frankfurt Branch, Mizuho Corporate Bank, Ltd. and UniCredit Bank
AG as coordinating mandated lead arrangers, certain financial institutions as mandated lead arrangers, Commerzbank Aktiengesellschaft,
Filiale Luxemburg as facility agent, UniCredit Bank AG as bank guarantee agent, Commerzbank AG, Deutsche Bank AG, Filiale Deutschlandgeschäft
and UniCredit Bank AG as original issuing banks and certain financial institutions as original lenders (the "Facilities
Agreement"), the Lenders have agreed to grant multicurrency revolving credit and bank guarantee facilities in the aggregate
amount of EUR 590,000,000 to the Borrowers.



 


		(B)	In order to ensure that the utilisation of Facility B by way of Bank Guarantees will at no time
exceed the Total Facility B Commitments, in particular in case a Facility B Lender has made available an Ancillary Facility, the
Parties to the Facilities Agreement agreed to clarify their common understanding in that respect by supplementing Clause 31.4 (Fronting
Sublimits) as set out in Clause 2 of this Supplemental Agreement.



 


		(C)	In order to avoid recognition of income of the non-US Subsidiaries of a US Borrower in the US it
is required to limit any guarantee provided by any such non-US Subsidiaries for the obligations of a US Borrower under the Finance
Documents. Consequently, the Parties to the Facilities Agreement agree to introduce such limitation in Clause 22 (Guarantee and
Indemnity) of the Facilities Agreement.



 


		(D)	In order to allow sufficient flexibility to implement further steps for a tax and cost effective
corporate reorganisation it may become necessary to transfer all shares in Elster Holdings Netherlands B.V. to Elster GmbH while
proceeds under the Initial Bond (as defined in the Facilities Agreement) continue to be on-lent to Elster Holdings Netherlands
B.V. This would not be permitted under Clause 26.6 (Holding Companies) of the Facilities Agreement if Elster GmbH did not
qualify as Intermediate Holding Company. Consequently, the Parties to the Facilities Agreement agree to amend Clause 26.6 (Holding
Companies) of the Facilities Agreement to introduce the relevant exception. In addition, as proceeds resulting from Additional
Financial Indebtedness may be on-lent not only to Permitted Financial Indebtedness Subsidiaries but also to Unlimited Guarantors
(each term as defined in the Facilities Agreement) the Parties to the Facilities Agreement agreed to clarify their common understanding
that the restrictions set out in Clause 26.6 (Holding Companies) of the Facilities Agreement shall not apply to a Permitted
Financial Indebtedness Subsidiary which qualifies as Unlimited Guarantor.



 



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NOW IT IS HEREBY AGREED as follows:


 


		1.	DEFINITIONS AND INTERPRETATION



 


		1.1	Incorporation of defined terms:



 


		(a)	Unless a contrary indication appears, a term defined in the Facilities Agreement has the same meaning
in this Agreement (including in the above preamble).



 


		(b)	The principles of construction set out in the Facilities Agreement shall have effect as if set
out in this Agreement.



 


		1.2	In this Agreement any reference to a "Clause" is, unless the context otherwise requires,
a reference to a Clause of the Facilities Agreement.



 


		1.3	In accordance with the Facilities Agreement, each of the Company and the Facility Agent designate
this Agreement as a Finance Document.



 


		2.	Amendment of the Facilities Agreement



 


The
Facilities Agreement shall be supplemented and amended with effect from the date of this Agreement as set out in paragraphs 2.1
to 2.4 below.


 


		2.1	In Clause 9.2 (Availability) the following sentence shall be included as second sentence
in paragraph (d):



 


"In case an Ancillary Facility
will be made available under Facility B, the Facility Agent shall notify the Bank Guarantee Agent no later than three (3) Business
Days prior to the Ancillary Commencement Date of the proposed establishment of such Ancillary Facility."


 


		2.2	In Clause 22.16 (US Guarantee Limitations) the existing language shall be designated as
paragraph (a) and the following paragraph (b) shall be added:



 


		"(b)	Notwithstanding any term or provision of this Clause 22 or any other term in this Agreement or
any other Finance Document the liabilities of a US Borrower shall not be guaranteed by any direct or indirect non-US Subsidiary
of such US Borrower which is treated as a controlled foreign corporation within the meaning of Section 957 of the Code.



 


Provided, however, that the
Company shall ensure that the aggregate of earnings before interest, tax, depreciation and amortisation (calculated on the same
basis as Adjusted Consolidated EBITDA) of those Guarantors the guarantee obligation of which is not limited by this paragraph (b)
of Clause 22.16 (US Guarantee Limitations) (in each case calculated on an unconsolidated basis and excluding all intra-group
items) represents not less than 70 per cent of Adjusted Consolidated EBITDA of the Group, and in the event the Company does not
so ensure, the limitation in this Clause 22.16 (b) shall not apply."


 



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		2.3	In Clause 26.6 (Holding Companies) the first paragraph of paragraph (a) shall be replaced
by the following paragraph which shall read as follows:



 


		"(a)	No Permitted Financial Indebtedness Subsidiary (other than an Unlimited Guarantor) which has incurred
Additional Financial Indebtedness or to which proceeds of Additional Financial Indebtedness have been directly on-lent (with respect
to paragraph (ii) below only, other than proceeds resulting from the Initial Bond up to a maximum aggregate amount of EUR 125,000,000)
shall, as long as such amount of Additional Financial Indebtedness is outstanding:"



 


		2.4	In Clause 31.4 (Fronting Sublimits) paragraph (d) shall be replaced by the following paragraphs
(d), (e), (f) and (g) which shall read as follows:



 


		"(d)	In case (i) a Facility B Lender agrees to make available an Ancillary Facility in place of all
or part of that Lender’s unutilised Facility B Commitment in accordance with Clause 9 (Ancillary Facilities) and (ii)
the Base Currency Amount of such Ancillary Facility would, when aggregate with the amount of the Fronting Sublimits of all Issuing
Banks under Facility B and the amount of all Ancillary Facilities under Facility B, exceed the Total Facility B Commitments (such
exceeding amount the "Ancillary Facility Excess Amount"), then the aggregate amount of the Fronting Sublimit of
all Issuing Banks shall be reduced by the Ancillary Facility Excess Amount in accordance with paragraph (e) below.



 


		(e)	The Bank Guarantee Agent shall, upon been notified of the establishment of the proposed Ancillary
Facility pursuant to paragraph (d) of Clause 9.2 (Availability), reduce the Fronting Sublimit of each Issuing Bank pro
rata by that part of the Ancillary Facility Excess Amount which is equal to the proportion borne by each Issuing Bank's Fronting
Sublimit to the Total Facility B Commitments unless the Company has notified the Bank Guarantee Agent no later than three (3) Business
Days prior to the establishment of the proposed Ancillary Facility that the Fronting Sublimit of one or more Issuing Banks shall
be excluded from such reduction (as a result of which the Fronting Sublimits of the remaining Issuing Banks shall be further reduced)
and the Ancillary Facility Excess Amount may be allocated to the unutilised Fronting Sublimits of the remaining Issuing Banks.
In case the unutilised Fronting Sublimit of an Issuing Bank does not allow for such proportional reduction in full, the unutilised
Fronting Sublimits of the other Issuing Banks shall be further reduced as set forth in this paragraph (e) until the aggregate amount
of the Fronting Sublimits of all Issuing Banks have been reduced by the Ancillary Facility Excess Amount. Any reduction of a Fronting
Sublimit pursuant to this paragraph (e) shall become effective on the Business Day following the Business Day the notification
pursuant to paragraph (d) of Clause 9.2 (Availability) has been received by the Bank Guarantee Agent, provided that any
such notification received after 1 p.m. on a Business Day shall be deemed to be received on the following Business Day.



 



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		(f)	The aggregate amount of (i) the Fronting Sublimits of all Issuing Banks under Facility B and (ii)
all Ancillary Facilities under Facility B shall at no time exceed the Total Facility B Commitments. Paragraph (d) and (e) of this
Clause 31.4 shall apply mutatis mutandis in case of any reduction of the Total Facility B Commitments to the extent the
aggregate amount of (i) the Fronting Sublimits of all Issuing Banks under Facility B and (ii) all Ancillary Facilities under Facility
B would otherwise exceed the Total Facility B Commitments after such reduction. In case of a cancellation of the Total Commitments
pursuant to Clause 27.13 (Acceleration), the Fronting Sublimits of all Issuing Banks under Facility B shall immediately
be reduced to zero.



 


		(g)	Upon any change of the amount of any Fronting Sublimit in accordance with this Clause 31.4, the
Facility Agent (in relation to any change pursuant to paragraphs (a) to (c) above) or the Bank Guarantee Agent (in relation to
any change pursuant to paragraphs (d) to (f) above), shall promptly inform the respective other Agent, the Issuing Banks and the
Company of any increase and/or reduction of any Fronting Sublimit."



 


		3.	REPRESENTATIONS



 


The Company
confirms to each Finance Party that each of the Repeated Representations is true and correct as at the date hereof as if made by
reference to the facts and circumstances existing on the date hereof.


 


		4.	Costs and Expenses



 


The
Company shall promptly on demand pay to the Facility Agent the amount of all costs and expenses (including legal fees) reasonably
incurred by the Facility Agent in connection with this Agreement.


 


		5.	MISCELLANEOUS



 


		5.1	Each party hereto shall at the request of the Facility Agent and at the Company's expense, promptly
do all such acts and things necessary or desirable to give effect to the amendments effected or to be effected pursuant to this
Agreement.



 


		5.2	The provisions of Clause 38 (Partial Invalidity) and Clause 45 (Jurisdiction) shall
be incorporated into this Agreement as if set out in full in this Agreement and as if references in those clauses to "this
Agreement" are references to this Agreement.



 


		5.3	This Agreement may be executed in any number of counterparts, and this has the same effect as if
the signatures on the counterparts were on a single copy of this Agreement.



 


		6.	governing law



 


This Agreement and any non-contractual
obligations arising out of or in connection with this Agreement are governed by German law.


 



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SIGNATURES


 


ELSTER GROUP SE



for itself and as Obligor's Agent on behalf
each of the other Obligors


 


	By:	 
	 	 
	Name(s):	 


 


Commerzbank
Aktiengesellschaft, Filiale Luxemburg


for itself
and on behalf of each of the other Finance Parties


 


	By:	 
	 	 
	Name(s):	 


 



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