Document:

Exhibit

EXHIBIT 10.2
EXECUTION COPY

July 30, 2018
Franklin Electric Co., Inc.
9255 Coverdale Road
Fort Wayne, Indiana 46809

		
	Re:
	Amendment No. 2 to Third Amended and Restated Note Purchase and Private Shelf Agreement 

Ladies and Gentlemen:

Reference is made to that certain Third Amended and Restated Note Purchase and Private Shelf Agreement, dated as of May 28, 2015, as amended by Amendment No. 1 to Third Amended and Restated Note Purchase and Private Shelf Agreement, dated October 28, 2016 (the “Note Agreement”), by and among Franklin Electric Co., Inc., an Indiana corporation (the “Company”), and PGIM, Inc. (formerly known as Prudential Investment Management, Inc.)(“Prudential”) and the Prudential Affiliates party thereto.  Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in the Note Agreement, as amended hereby.
The Company has requested a three year extension of the Issuance Period of the Facility and certain amendments of the terms and provisions of the Note Agreement as set forth herein, and the Company, Prudential and the holders (which constitute the Required Holders) have agreed to such amendments, all under the terms and conditions set forth in this Letter Amendment No. 2 to Third Amended and Restated Note Purchase and Private Shelf Agreement (this “Amendment No. 2” or this “letter”).

Accordingly, and in accordance with the provisions of paragraph 11C of the Note Agreement, the parties hereto agree as follows:
SECTION 1.  Amendments to Note Agreement.

1.1    Amendment to Paragraph 1B.  Paragraph 1B of the Note Agreement is amended by deleting the reference to “$100,000,000” in the first sentence of such paragraph and replacing it with a reference to “150,000,000”:

1.2    Amendment to Paragraph 2A(2).  Paragraph 2A(2) of the Note Agreement is amended by deleting the date “May 28, 2018” in the first sentence of such paragraph and replacing it with the date “July 30, 2021”:

1.3    Amendment to Paragraph 2A(8)(i).  Paragraph 2A(8)(i) of the Note Agreement is amended by deleting the entire heading and paragraph and replacing the heading and paragraph with the phrase “[Intentionally Omitted”].

1.3.    Amendment to Paragraph 6B(13).  Paragraph 6B(13) of the Note Agreement is amended and restated in its entirety to read as follows:
“6B(13).      Economic Sanctions, Etc.  The Company will not, and will not permit any Controlled Entity to (a) become (including by virtue of being owned or controlled by a Blocked Person), own or control a Blocked Person or (b) directly or indirectly have any investment in or engage in any dealing or transaction (including any investment, dealing or transaction involving the proceeds of the Notes) with any Person if such investment, dealing or transaction (i) would cause any holder or any affiliate of such holder to be in violation of, or subject to sanctions under, any law or regulation applicable to such holder, or (ii) is prohibited by or subject to sanctions under any U.S. Economic Sanctions Laws.”

1.4.    Amendment to Paragraph 10B.  The following definition is amended and restated in its entirety in paragraph 10B of the Note Agreement to read as follows:

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“‘Prudential’ shall mean PGIM, Inc.”

SECTION 2.  Conditions Precedent.  This Amendment No. 2 shall become effective as of the date (the “Effective Date”) upon which each of the following conditions is satisfied:

2.1     Documents.  Prudential shall have received original counterparts or, if satisfactory to Prudential, certified or other copies of (i) this Amendment No. 2, duly executed by the Company, dated the date hereof, and on such date in full force and effect, and (ii) the Consent and Acknowledgement of the parties to the Subsidiary Guaranty, in the form of Exhibit A hereto.

2.2    Fees and Expenses.  The Company shall have paid the following: (i) a non-refundable Facility renewal fee of $25,000, which fee shall be payable to Prudential by wire transfer in immediately available funds to: JPMorgan Chase Bank, New York, New York, ABA No.: 021-000-021; Account # 304232491; Account Name: PGIM, Inc. - PCG; and (ii) the fees and expenses of special counsel to the holders of the Notes in connection with this Amendment No. 2 that have been presented to the Company.

2.3     Representations and Warranties.  The representations and warranties of the Company in Section 3 hereof shall be true and correct on the Effective Date.

2.4      Proceedings.  All corporate and other proceedings taken or to be taken in connection with the transactions contemplated hereby and all documents incident thereto shall be satisfactory in substance and form to Prudential and its counsel, and Prudential shall have received all such counterpart originals or certified or other copies of such documents as it may reasonably request.

SECTION 3.  Representations and Warranties.  To induce Prudential to execute and deliver this letter, the Company hereby represents, warrants and covenants that (1) the execution and delivery of this letter has been duly authorized by all necessary corporate action on behalf of the Company and this Amendment No. 2 has been executed and delivered by a duly authorized officer of the Company, and all necessary or required consents to this Amendment No. 2 have been obtained and are in full force and effect (except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), (2) the representations and warranties contained in paragraph 8 of the Note Agreement are true on and as of the Effective Date, except to the extent any such representation or warranty is stated to relate solely to an earlier date, in which case such representation or warranty shall have been true and correct on and as of such earlier date, and (3) there shall not exist on the Effective Date any Event of Default or Default.

SECTION 4.  Reference to and Effect on Note Agreement.  Upon the Effective Date, each reference to the Note Agreement in any other document, instrument or agreement shall mean and be a reference to the Note Agreement, as modified by this Amendment No. 2.  Except as specifically set forth in Section 1 of this Amendment No. 2, the Note Agreement shall remain in full force and effect and each is hereby ratified and confirmed in all respects. Except as specifically set forth in Section 1 of this Amendment No. 2, the execution, delivery and effectiveness of this letter shall not (a) amend the Note Agreement or any Note, (b) operate as a waiver of any right, power or remedy of the holder of any Note, or (c) constitute a waiver of, or consent to any departure from, any provision of the Note Agreement or any Note at any time.

SECTION 5.  Expenses.  The Company hereby confirms its obligations under the Note Agreement, whether or not the transactions hereby contemplated are consummated, to pay, promptly after request by Prudential, all reasonable out-of-pocket costs and expenses, including attorneys’ fees and expenses, incurred by Prudential in connection with this letter agreement or the transactions contemplated hereby, in enforcing any rights under this letter, or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this letter or the transactions contemplated hereby. The obligations of the Company under this Section 5 shall survive transfer by the noteholders of any Note and payment of any Note.

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SECTION 6.  Governing Law.  THIS LETTER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES OR IN CONNECTION WITH ANY CLAIMS OR DISPUTES ARISING OUT OF OR RELATING TO THIS LETTER (WHETHER SOUNDING IN CONTRACT OR TORT) SHALL BE GOVERNED BY, THE LAW OF THE STATE OF ILLINOIS (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE THIS AGREEMENT TO BE CONSTRUED OR ENFORCED IN ACCORDANCE WITH, OR THE RIGHTS OF THE PARTIES TO BE GOVERNED BY, THE LAWS OF ANY OTHER JURISDICTION).

SECTION 7.  Counterparts; Facsimile Signature Pages; Section Titles.  This letter may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this letter by facsimile or electronic transmission shall be effective as delivery of a manually executed counterpart of this letter.  The section titles contained in this letter are and shall be without substance, meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.
[signature page follows]

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Very truly yours,
PGIM, INC. 
 
By:    ______________________________    
Vice President 

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

By:    
__________________________ 
    Vice President

MUTUAL OF OMAHA INSURANCE COMPANY
UNITED OF OMAHA LIFE INSURANCE COMPANY 
 
By: Prudential Private Placement Investors, L.P. (as Investment Advisor)

By: Prudential Private Placement Investors, Inc. (as General Partner)

By:__________________________ 
    Vice President
Agreed and accepted:

FRANKLIN ELECTRIC, CO., INC.

By:    /s/ Jonathan Grandon     
    Name: Jonathan Grandon     
    Title: Secretary    

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO THIRD AMENDED AND RESTATED NOTE PURCHASE AND PRIVATE SHELF AGREEMENT]

EXHIBIT A
CONSENT AND ACKNOWLEDGEMENT  
July 30, 2018
The undersigned, each a Subsidiary Guarantor under the Subsidiary Guaranty Agreement, dated as of July 28, 2017 (the “Guaranty”), in favor each of the holders of Notes, under the Third Amended and Restated Note Purchase and Private Shelf Agreement, dated as of May 28, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Note Agreement”; capitalized terms used and not otherwise defined in this Consent and Acknowledgement have the respective meanings ascribed to them in the Note Agreement), hereby acknowledges, confirms and agrees that the Guaranty is, and shall continue to be, in full force and effect and is hereby confirmed and ratified in all respects after giving effect to Amendment No. 2 to the Third Amended and Restated Note Purchase and Private Shelf Agreement.
[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF, the parties hereto have caused this Consent and Acknowledgment to be duly executed and delivered by their respective proper and duly authorized officers effective as of the date first above written.

FRANKLIN CONTROL SYSTEMS, LLC
   (f/k/a Franklin Control Systems, Inc.)

By:     /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary

PIONEER PUMP, LLC
   (f/k/a/ Pioneer Pump Holdings, Inc.)

By:     /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
  

HEADWATER COMPANIES, LLC
   (f/k/a/ Franklin Electric Ventures, LLC)

By: /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
  

PIONEER PUMP, LLC
   (f/k/a Pioneer Pump, Inc.)

By: /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
 

FRANKLIN ELECTRIC INTERNATIONAL, INC.

By:     /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
 

[ADDITIONAL SIGNATURE PAGES TO CONSENT AND ACKNOWLEDGMENT FOLLOW]

FRANKLIN FUELING SYSTEMS, LLC
   (f/k/a Franklin Fueling Systems, Inc.)

By: /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
  

FRANKLIN GRID SOLUTIONS, LLC
   (f/k/a Intelligent Controls, Inc.)

By:     /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
  

2M COMPANY, INC.
By: /s/ Jonathan M. Grandon

Name:  Jonathan M. Grandon    
Title:  Secretary
  

DRILLERS SERVICE, LLC
   (f/k/a Drillers Service, Incorporated)

By:     /s/ Jonathan M. Grandon

                                 Name:  Jonathan M. Grandon    
Title:  Secretary
  

WESTERN HYDRO, LLC

By:     /s/ Jonathan M. Grandon

                                  Name:  Jonathan M. Grandon    
Title:  Secretary
 

[SIGNATURE PAGE TO CONSENT AND ACKNOWLEDGMENT]

[SIGNATURE PAGE TO CONSENT AND ACKNOWLEDGMENT]Exhibit

EXHIBIT 10.3
Execution Version
SECOND AMENDMENT TO NOTE PURCHASE AND PRIVATE SHELF  
AGREEMENT
THIS SECOND AMENDMENT TO NOTE PURCHASE AND PRIVATE SHELF AGREEMENT (this "Amendment"), is made and entered into as of July 30, 2018, by and among Franklin Electric Co., Inc., an Indiana corporation (the "Company"), NYL Investors LLC ("NYL Investors") and each of the undersigned holders of Notes (as defined in the Note Agreement defined below) that are signatories hereto (together with their successors and assigns, the "Noteholders").
WITNESSETH:
WHEREAS, the Company and the Noteholders are parties to that certain Note Purchase and Private Shelf Agreement, dated as of May 27, 2015, as amended by that certain First Amendment to Note Purchase and Private Shelf Agreement, dated as of October 28, 2016 (as so amended and as otherwise amended, restated, supplemented or otherwise modified from time to time, the "Note Agreement"; capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Note Agreement), pursuant to which the Noteholders have purchased Notes from the Company; and
WHEREAS, the Company has requested that the Noteholders reinstate the Facility and amend certain provisions of the Note Agreement, and subject to the terms and conditions hereof, the Noteholders are willing to do so;
NOW, THEREFORE, for good and valuable consideration, the sufficiency and receipt of all of which are acknowledged, the Company and the Noteholders agree as follows:
1.Shelf Facility Reinstatement.
The Facility is reinstated effective as if it had not expired. 
2.Amendments.
(a)Section 2.3 of the Note Agreement is hereby amended by replacing clause (a) of such section in its entirety with the following:
(a)    July 30, 2021 (or if such date is not a Business Day, the Business Day next preceding that date);
(b)Schedule A is hereby amended by replacing the defined term “Available Facility Amount” in its entirety with the following:
“Available Facility Amount” means, at any point in time, (a) $200,000,000, minus (b) the aggregate principal amount of Notes (including the Series A Notes) purchased and sold pursuant to this Agreement prior to that time, minus (c) the aggregate principal amount 

of Accepted Notes that have not been purchased and sold hereunder prior to that time and for which the closing has not been cancelled, plus (d) the aggregate principal amount of Notes purchased, sold, and repaid or prepaid pursuant to this Agreement prior to that time.
(c)Schedule 5.8 of the Note Agreement is hereby replaced in its entirety with Schedule 5.8 attached hereto.
3.Conditions to Effectiveness of this Amendment.  Notwithstanding any other provision of this Amendment and without affecting in any manner the rights of the holders of the Notes hereunder, it is understood and agreed that this Amendment shall not become effective, and the Company shall have no rights under this Amendment, until the Noteholders shall have received (i) to the extent the Company has received an invoice on or prior to the date hereof, reimbursement or payment of the costs and expenses of the Noteholders incurred in connection with this Amendment or the Note Agreement (including reasonable fees, charges and disbursements of King & Spalding LLP, counsel to the Noteholders) and (ii) executed counterparts to this Amendment from the Company and the Required Holders.
4.Representations, Covenants, and Warranties. To induce the Noteholders to enter into this Amendment, the Company hereby represents, covenants and warrants to the Noteholders that:

(a)The Company is a corporation duly organized and existing in good standing under the laws of the State of Indiana and has the corporate power to own its property and to carry on its business as now being conducted.  Each Subsidiary is duly organized and existing in good standing under the laws of its jurisdiction of incorporation and has the corporate power to own its property and to carry on its business as now being conducted except in such instances where the failure could not be reasonably expected to result in a Material Adverse Effect.  Each of the Company and its Subsidiaries is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect;

(b)The Company has the corporate power and authority to execute and deliver this Amendment and to perform the provisions hereof.  The execution, delivery and performance of this Amendment has been duly authorized by all requisite corporate action, and this Amendment has been duly executed and delivered by authorized officers of the Company and are valid obligations of the Company, legally binding upon and enforceable against the Company in accordance with their terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law); and

(c)After giving effect to this Amendment, the representations and warranties  
contained in the Note Agreement are true, accurate and correct in all material respects (or in all respects in the case of any representation and warranty qualified by materiality or Material Adverse Effect) on and as of the date hereof, except to the extent that any such representation and warranty specifically relates to an earlier date, in which case they shall be true, accurate and correct as of such earlier date, and no Default or Event of Default has occurred and is continuing as of the date hereof.
5.    Effect of Amendment. Except as set forth expressly herein, all terms of the Note Agreement, as amended hereby, shall be and remain in full force and effect and shall constitute the legal, valid, binding and enforceable obligations of the Company to all holders of the Notes. The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the holders of the Notes under the Note Agreement, nor constitute a waiver of any provision of the Note Agreement. From and after the date hereof, all references to the Note Agreement shall mean the Note Agreement as modified by this Amendment. 

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6.    Governing Law. This Amendment shall be governed by, and construed in accordance with, the internal laws of the State of New York and all applicable federal laws of the United States of America.
7.    No Novation. This Amendment is not intended by the parties to be, and shall not be construed to be, a novation of the Note Agreement or an accord and satisfaction in regard thereto.
8.    Costs and Expenses. The Company agrees to pay on demand all costs and expenses of the Noteholders in connection with the preparation, execution and delivery of this Amendment, including, without limitation, the reasonable fees and out-of-pocket expenses of outside counsel for the Noteholders with respect thereto.
9.    Counterparts. This Amendment may be executed by one or more of the parties hereto in any number of separate counterparts, each of which shall be deemed an original and all of which, taken together, shall be deemed to constitute one and the same instrument. Delivery of an executed counterpart of this Amendment by facsimile transmission or by electronic mail in pdf form shall be as effective as delivery of a manually executed counterpart hereof.
10.    Binding Nature. This Amendment shall be binding upon and inure to the benefit of the parties hereto, any other holders of Notes from time to time and their respective successors, successors-in-titles, and assigns.
11.    Entire Understanding. This Amendment sets forth the entire understanding of the parties with respect to the matters set forth herein, and shall supersede any prior negotiations or agreements, whether written or oral, with respect thereto.
12.    Severability. If any term or provision of this Amendment shall be deemed prohibited by or invalid under any applicable law, such provision shall be invalidated without affecting the remaining provisions of this Amendment or the Note Agreement, respectively.
[Signature Pages to Follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed, under seal in the case of the Company, by its respective authorized officers as of the day and year first above written.

COMPANY:
FRANKLIN ELECTRIC CO., INC. 
By:  /s/ Jonathan M. Grandon
Name: Jonathan M. Grandon
Title: Secretary

[SIGNATURE PAGE TO SECOND AMENDMENT
TO NOTE PURCHASE AND PRIVATE SHELF AGREEMENT]

NYL INVESTORS LLC

By: /s/ James M. Belletire

Name: James M. Belletire

Title: Managing Director                

[SIGNATURE PAGE TO SECOND AMENDMENT
TO NOTE PURCHASE AND PRIVATE SHELF AGREEMENT]

NOTEHOLDERS

NEW YORK LIFE INSURANCE COMPANY

By: /s/ James M. Belletire

Name: James M. Belletire

Title: Managing Director    

NEW YORK LIFE INSURANCE
AND ANNUITY CORPORATION
By: NYL Investors LLC, its Investment Manager

By: /s/ James M. Belletire

Name: James M. Belletire

Title: Managing Director        

[SIGNATURE PAGE TO SECOND AMENDMENT
TO NOTE PURCHASE AND PRIVATE SHELF AGREEMENT]

Schedule 5.8
Conflicting Agreements and Other Matters

Third Amended and Restated Credit Agreement dated as of October 28, 2016 by and among (i) the Franklin Electric Co., Inc., an Indiana corporation, Franklin Electric B.V., a Netherlands private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid, (ii) the financial institutions party thereto and (iii) JPMorgan Chase Bank, N.A., as Administrative Agent, (including any renewals, extensions, amendments, supplements, restatements, replacements or refinancings thereof), and related guarantees;

Bond Purchase and Loan Agreement, dated December 31, 2012, among The Board of Commissioners of the County of Allen, as Issuer, Franklin Electric Co., Inc., an Indiana corporation, as Borrower, and the Bondholders referred to therein, (including any renewals, extensions, amendments, supplements, restatements, replacements or refinancings thereof), and related guarantees; and

Third Amended and Restated Note Purchase and Private Shelf Agreement dated as of May 28, 2015, between Franklin Electric Co., Inc., an Indiana corporation, and Prudential Investment Management, Inc. (now known as PGIM, Inc.) (“Prudential”) and the Prudential Affiliates party thereto (including any renewals, extensions, amendments, supplements, restatements, replacements or refinancings thereof), and related guarantees.

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