Document:

exv10w4

Exhibit 10.4

3COM CORPORATION

STAND ALONE RESTRICTED STOCK AGREEMENT

     3Com Corporation has granted Eileen Nelson (the “Participant”) Restricted Stock shares in
accordance with the Participant’s offer letter dated May 20, 2008 — Revised (the “Offer
Letter”), subject to the following terms and conditions as set forth in this Award Agreement.
The “Effective Date” of this Award Agreement shall be June 3, 2008.

     1. Definitions; Vesting and Reacquisition Rights. As used herein, the following
definitions shall apply:

          (a) “Administrator” means the Board or any of its Committees as shall be administering
the Award.

          (b) “Applicable Laws” means the requirements relating to the administration of
restricted stock plans under U.S. state corporate laws, U.S. federal and state securities laws, the
Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and any
other applicable laws.

          (c) “Award” means, individually or collectively, the grant of Restricted Stock under
this Award Agreement and Notice of Grant of Restricted Stock.

          (d) “Award Agreement” means this Stand Alone Restricted Stock Agreement between the
Company and the Participant evidencing the terms and conditions of this Award.

          (e) “Board” means the Board of Directors of 3Com Corporation.

          (f) “Change of Control” shall have the meaning ascribed thereto (or to any
similar definition such as “Change in Control”) in the Management Retention Agreement between the
Company and the Participant effective as of May 20, 2008, as amended from time to time.

          (g) “Code” means the U.S. Internal Revenue Code of 1986, as amended.

          (h) “Committee” means a committee, which may consist of one or more persons whom may
or may not be Board members, as is consistent with the Applicable Laws, appointed by the Board.

          (i) “Common Stock” means the common stock of the Company.

          (j) “Company” shall mean 3Com Corporation and any successor corporation thereto.

          (k) “Consultant” means any person, including an advisor, engaged by the Company or a
Parent or Subsidiary as an independent contractor to render services to such entity.

          (l) “Date of Restricted Stock Grant” shall mean the “Date of Grant” as set forth in
the Notice of Grant.

          (m) “Director” means a member 3Com’s Board of Directors.

          (n) “Employee” means any person, including Officers and Directors, employed by the
Company or any Parent or Subsidiary of the Company. A Service Provider shall not cease to be an
Employee in the case of (i) any leave of absence approved by the Company or any leave for which a
return to employment is guaranteed under Applicable Laws, or (ii) transfers between locations of
the Company or between the Company, its Parent, any Subsidiary, or any successor. Neither service
as a Director nor payment of a director’s fee by the Company shall be sufficient to constitute
“employment”

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by the Company.

          (o) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          (p) “Initial Vesting Date” shall be the date occurring one (1) year after the Date of
Restricted Stock Grant.

          (q) “Notice of Grant” shall mean the “NOTICE OF GRANT OF RESTRICTED STOCK”. The
Notice of Grant is part of this Award Agreement.

          (r) “Number of Restricted Stock” shall mean the “Total Number of Restricted Stock
Granted” as set forth in the Notice of Grant.

          (s) “Offer Letter” shall have the meaning ascribed thereto in the first paragraph of
this Agreement.

          (t) “Officer” means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

          (u) “Parent” means a “parent corporation,” whether now or hereafter existing, as
defined in Section 424(e) of the Code.

          (v) “Restricted Stock” means shares of Common Stock or units/rights to acquire shares
of Common Stock granted pursuant to this Agreement that are subject to vesting, as adjusted in
accordance with this Agreement.

          (w) “Service Provider” means an Employee, Director or Consultant.

          (x) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing,
as defined in Section 424(f) of the Code and also include partnerships, limited liability companies
and other entities that are at least 30% owned by the Company.

          Vesting, Restrictions on Unvested Shares and Unvested Share Reacquisition
Right.

          Vesting. Subject to the terms and conditions of this Award Agreement, and provided
that the Participant remains a Service Provider through each vesting date, the Restricted Stock
shall become “Vested Shares” for purposes of this Award Agreement in three (3) equal,
annual installments, commencing on the Initial Vesting Date. Until the shares of Restricted Stock
vest and become Vested Shares, which unvested shares shall be called Unvested Shares (as defined
below), neither the Unvested Shares, nor any right with respect to the Unvested Shares of
Restricted Stock under this Agreement, may be sold, assigned, transferred, pledged, hypothecated
(by operation of law or otherwise) or otherwise conveyed or encumbered and shall not be subject to
execution, attachment or similar process. Any attempted sale, assignment, transfer, pledge,
hypothecation or other conveyance or encumbrance shall be void and unenforceable against the
Company or any affiliate of the Company. Upon becoming Vested Shares, such restrictions shall
lapse. A legend or legends may be affixed to share certificates representing the Restricted Stock
evidencing these restrictions.

     Notwithstanding the foregoing, the Participant shall receive accelerated vesting with respect
to all or a portion of the Participant’s then outstanding unvested portion of the Award, subject to
the terms and conditions specified in the Management Retention Agreement (“MRA”) and the
Severance Benefits Agreement (“SBA”), as the same may be amended from time to time, each by
and between the Company and the Participant effective May 20, 2008.

          Unvested Share Reacquisition Right. In the event that the Participant’s Service
Provider relationship with the Company is terminated for any reason, with or without cause, the
Company shall automatically reacquire all shares of Restricted Stock that are not Vested Shares as
of the termination date

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(the “Unvested Shares”) without any action on the part of
Participant, who shall forfeit such shares immediately, and the Participant shall not be entitled
to any payment therefor (the “Unvested Share Reacquisition Right”).

     2. Leaves of Absence. Unless the Administrator provides otherwise or as otherwise
required by Applicable Laws, the Restricted Stock shall cease to vest on the 91st day of
any unpaid leave of absence and shall only recommence upon the Participant’s return to active
service.

     3. Rights as a Shareholder or Employee. The Participant shall have no rights as a
stockholder with respect to the shares of Restricted Stock until such time as the shares are issued
to the Participant in the form of a certificate or certificates or other appropriate means as
determined by the Company in its discretion. Except as provided in this Agreement, no adjustment
shall be made for dividends or distributions or other rights for which the record date is prior to
the date such shares are issued.

     4. No Guarantee of Continued Service. THE PARTICIPANT ACKNOWLEDGES AND AGREES THAT
THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS AN
EMPLOYEE OR OTHER SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED,
BEING GRANTED THE RESTRICTED STOCK OR ACQUIRING SHARES HEREUNDER). THE PARTICIPANT FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AWARD AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE
VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED
ENGAGEMENT AS AN EMPLOYEE OR OTHER SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT
ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH THE PARTICIPANT’S RIGHT OR THE COMPANY’S RIGHT TO
TERMINATE THE PARTICIPANT’S RELATIONSHIP AS AN EMPLOYEE OR OTHER SERVICE PROVIDER OF THE COMPANY AT
ANY TIME, WITH OR WITHOUT CAUSE OR NOTICE.

     5. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation or Change of Control.

          (a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the number of shares of Common Stock covered by each outstanding Award, as well as the
price per share of Common Stock covered by each such outstanding Award, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from
a stock split, reverse stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been “effected without receipt of
consideration.” Such adjustment shall be made by the Administrator, whose determination in that
respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance
by the Company of shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an Award.

          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify the Participant as soon as practicable
prior to the effective date of such proposed transaction. The Administrator in its discretion may
provide for the Participant to have the right to exercise his Award until ten (10) days prior to
such transaction as to all of

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the stock covered thereby, including shares of Restricted Stock as to
which the Award would not otherwise be vested or exercisable. In addition, the Administrator may
provide that any Company repurchase option or forfeiture applicable to any shares covered by the
Award shall lapse as to all such shares, provided the proposed dissolution or liquidation takes
place at the time and in the manner contemplated. To the extent it has not been previously
exercised, if applicable, an Award will terminate immediately prior to the consummation of such
proposed action.

          (c) Change of Control. In the event of a Change of Control, each outstanding
Restricted Stock award shall be assumed or an equivalent award substituted by the successor
corporation or a Parent or subsidiary of the successor corporation. In the event that the
successor corporation refuses to assume or substitute for the Restricted Stock, the Participant
shall fully vest in the Restricted Stock, including shares of Restricted Stock as to which it would
not otherwise be vested. For the purposes of this paragraph, the Restricted Stock shall be
considered assumed if, following the Change of Control, the Restricted Stock confers the right to
receive, for each share of Restricted Stock and each unit/right to acquire a share of Restricted
Stock that is subject to the Restricted Stock award immediately prior to the Change of Control, the
consideration (whether stock, cash, or other securities or property) received in the Change of
Control by holders of Common Stock for each share of Restricted Stock and each unit/right to
acquire a share of Restricted Stock held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding shares); provided, however, that if such consideration received in the
Change of Control is not solely common stock of the successor corporation or its Parent, the
Administrator may, with the consent of the successor corporation, provide for the consideration to
be received, for each share of Restricted Stock and each unit/right to acquire a share subject to
the Restricted Stock award, to be solely common stock of the successor corporation or its Parent
equal in fair market value to the per share consideration received by holders of Common Stock in
the Change of Control.

     6. Non-Transferability of Restricted Stock. Restricted Stock may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by
the laws of descent or distribution.

     7. Conditions Upon Issuance of Shares. No Restricted Stock shall be issued pursuant
to this Award Agreement if the issuance and delivery of such Restricted Stock would constitute a
violation of any applicable federal or state securities law or other law or regulation, or would
fail to satisfy the requirements of any stock exchange upon which the Restricted Stock may then be
listed. As a condition to the issuance and delivery of the Restricted Stock, the Company may
require the Participant to satisfy any qualifications that may be necessary or appropriate, to
evidence compliance with any applicable law or regulation and to make any representation or
warranty with respect thereto as may be requested by the Company. The Company shall not be
required (a) to transfer on its books any shares which are sold or transferred in violation of any
of the provisions set forth in this Award Agreement or the Offer Letter, or (b) to treat as the
owner of the shares or to accord the right to vote as such owner or to pay dividends to any
transferee to whom the shares shall have been so transferred.

     8. Legends. The Company may at any time place legends referencing the Unvested Share
Reacquisition Right set forth above and any applicable federal and/or state securities law or other
restrictions on any and all certificates representing shares of Restricted Stock subject to the
provisions of this Award Agreement. The Participant shall, at the request of the Company, promptly
present to the Company any and all certificates representing shares of Restricted Stock acquired under this
Award Agreement in the possession of the Participant in order to carry out the provisions of this
Section 8. Unless otherwise specified by the Company, legends placed on such certificates may
include, but shall not be limited to, the following:

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          “THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS SET FORTH IN THIS
AWARD AGREEMENT BETWEEN THE CORPORATION AND THE REGISTERED HOLDER, OR SUCH HOLDER’S PREDECESSOR IN
INTEREST, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE CORPORATION.”

     9. Escrow.

          (a) Establishment of Escrow. To ensure that the Restricted Shares subject to the
Unvested Share Reacquisition Right will be available for reacquisition, the Company may require the
Participant to deposit the certificate or certificates evidencing the Unvested Shares with an
escrow agent designated by the Company under the terms and conditions of an escrow agreement
approved by the Company. If the Company does not require such deposit as a condition of the
issuance of Restricted Stock to the Participant, the Company reserves the right at any time to
require the Participant to so deposit the Unvested Share certificate or certificates in escrow.
The Company shall bear the expenses of the escrow.

          (b) Delivery of Shares to the Participant. As soon as practicable after the
expiration of the Unvested Share Reacquisition Right, the escrow agent shall deliver to the
Participant the Restricted Stock no longer subject to such restriction.

     10. Section 83(b) Election; Withholding. The Participant acknowledges and understands
that when the shares of Restricted Stock become Vested Shares under this Award Agreement, Section
83 of the Code imposes a tax at ordinary income rates with respect to such Vested Shares in an
amount equal to the fair market value of such Vested Shares, determined on the date such shares
become Vested Shares. The Participant also understands that (i) alternatively, the Participant may
elect to be taxed in the year the shares were granted rather than when the shares become Vested
Shares by filing an election under Section 83(b) of the Code with the Internal Revenue Service
within thirty (30) days from the Grant Date; (ii) if the Participant files such an election, the
Participant will be taxed at ordinary income rates on the fair market value of the shares on the
Grant Date; (iii) if the Participant makes such an election he must provide the Company with a copy
of the election no later than three (3) business days after filing the election with the Internal
Revenue Service; and (iv) the Participant must file another copy of the election with his federal
income tax return for the tax year in which Participant filed the election. The Participant
acknowledges that it is the Participant’s sole responsibility and not the Company’s responsibility
to determine whether it is advisable to make the election and, if the Participant so elects, to
file the election in a timely fashion and to make any filings under corresponding provisions of
state tax law.

     At the time that this Award Agreement is executed, or at any time thereafter as determined by
the Company, the Company shall have the right to withhold the applicable minimum withholding taxes,
including but not limited to federal tax, state tax, foreign taxes, or social taxes, if any, which
arise in connection with the acquisition of Restricted Stock pursuant to this Award Agreement or
the Offer Letter, including, without limitation, obligations arising upon (i) the transfer, in
whole or in part, of any shares of Restricted Stock, (ii) the lapse of any restriction with respect
to any shares of Restricted Stock acquired pursuant to this Award Agreement or the Offer Letter, or
(iii) the filing of an election to recognize a tax liability. The Participant authorizes the
Company to withhold from the Participant’s compensation such amounts as may be necessary to satisfy
the minimum applicable tax withholding obligations arising in connection with the issuance of the
shares of Restricted Stock pursuant to this Award Agreement or the Offer Letter. The Company shall
have no obligation to issue a certificate as to the shares and/or to release the shares from escrow
until applicable withholding obligations have been satisfied.

     11. Trade Shares for Taxes. Please circle the applicable election below if you wish
to trade shares to satisfy the minimum required tax withholding determined upon the date of vesting
outlined in this Agreement. If you elect to trade shares to satisfy the minimum taxes due, the
remaining amount due after the trade, less than the value of one share, will be deducted from your
cash compensation. If you

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wish to change your election during the life of the Award Agreement, you
must contact stock administration at least thirty (30) days prior to the applicable vesting date.

TRADE SHARES FOR TAXES DUE (please circle one):     YES     NO

If you do not wish to trade shares for taxes, and select “no” above, you must provide payment to
stock administration within fifteen (15) days from date of vesting. If payment is not provided
within fifteen (15) days after applicable taxes are due, stock administration will have the
authority and discretion to (i) trade shares to satisfy such applicable taxes or (ii) to withhold
the entire tax obligation from your compensation.

     12. Broker. Your Restricted Stock will be deposited directly into your brokerage
account with the Company’s approved broker when vested and the applicable withholding obligations
have been satisfied.

     13. Further Instruments; Binding Effect. The parties hereto agree to execute such
further instruments and to take such further action as may reasonably be necessary to carry out the
intent of this Award Agreement. This Award Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective heirs, executors, administrators, successors and
assigns.

     14. Administration; Amendment or Termination. All questions of interpretation
concerning this Award Agreement shall be determined by the Administrator in its sole discretion.
All determinations by the Administrator shall be final and binding upon all persons having an
interest in this Award Agreement. The Administrator may at any time amend, alter, suspend or
terminate the Agreement; provided, however, that no such amendment, alteration, suspension or
termination may adversely affect the Restricted Stock hereof without the written consent of the
Participant. Termination of the Agreement shall not affect the Administrator’s ability to exercise
the powers granted to it hereunder with respect to Awards granted under the Agreement prior to the
date of such termination.

     15. Entire Agreement; Applicable Law; Severability. This Award Agreement, along with
the Participant’s Offer Letter and the MRA and SBA referenced herein, constitute the entire
agreement of the parties with respect to the subject matter hereof and supersede in their entirety
all prior undertakings and agreements of the Company and the Participant with respect to the
subject matter hereof. This Award Agreement shall be construed in accordance with, and all
disputes hereunder shall be governed by, the laws of the Commonwealth of Massachusetts without
regard to its conflict of laws rules.

     If one or more provisions of this Award Agreement are held invalid, illegal and/or
unenforceable in any respect, the validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby and the invalid, illegal or unenforceable
provision(s) shall be deemed null and void; provided, however, to the extent permissible under
applicable law, that any such provision(s) shall be first construed, interpreted and/or revised to
permit this Award Agreement to be construed so as to foster the intent of this Award Agreement.

     16. Notices. Any notice to be given to the Company hereunder shall be in writing and
shall be addressed to the Company at its then current principal executive office or to such other
address as the Company may hereafter designate to the Participant. Any notice to be given to the
Participant hereunder shall be addressed to the Participant at the last address known to the
Company, or at such other address as the Participant may hereafter designate to the Company. A
notice shall be deemed to have been duly given when personally delivered or mailed by registered or
certified mail to the party entitled to receive it.

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     17. Data Privacy. By entering into this Award Agreement, the Participant consents to
the collection, use and transfer of personal data as described in this Section. The Participant
understands that the Company and its subsidiaries hold certain personal information about the
Participant including, but not limited to, the Participant’s name, home address and telephone
number, date of birth, social security number or equivalent tax identification number, salary,
nationality, job title, any shares of stock or directorships held in the Company, details of all
shares or other entitlements to shares awarded, cancelled, exercised, vested, unvested or
outstanding in the Participant’s favor, for the purpose of managing and administering this Award
Agreement (“Data”). The Participant further understands that the Company and/or its
subsidiaries will transfer Data amongst themselves as necessary for the purposes of implementation,
administration, and management of the Participant’s participation in this Award Agreement, and that
the Company and/or its subsidiaries may each further transfer Data to any third parties assisting
the Company in the implementation, administration and management of this Award Agreement (“Data
Recipients”). Where the Company or any of its subsidiaries transfer Data to any Data
Recipients, it will take into account any legal obligations which apply with respect to the
processing of that Data. The Participant understands that these Data Recipients may be located in
the Participant’s country of residence, the European Economic Area, or elsewhere throughout the
world, including, but not limited to, the United States. The Participant hereby authorizes the
Data Recipients to receive, possess, use, retain and transfer Data in electronic or other form, for
the purposes of implementing, administering and managing the Participant’s participation in this
Award Agreement, including any transfer of such Data, as may be required for the administration of
this Award Agreement and/or the subsequent holding of shares of Restricted Stock on the
Participant’s behalf, to a broker or third party with whom the shares acquired upon vest may be
deposited. The Participant understands that he or she may, at any time, review the Data, require
any necessary amendments to it or withdraw the consent herein in writing by contacting the
Company’s Stock Administration Department. The Participant further understands that withdrawing
consent may affect the Participant’s ability to participate in this Award Agreement. Without
prejudice to other provisions of this Award Agreement, the Company hereby reserves the right to
terminate the Participant’s participation in this Award Agreement (including, but not limited to,
the Participant’s ability to vest in the shares of Restricted Stock granted hereunder) if, by
withdrawal of the Participant’s consent to the collection, use and transfer of Data, the Company
and/or Data Recipients may not, in the Company’s sole discretion, lawfully administer the
Participant’s participation in this Award Agreement.

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     IN WITNESS WHEREOF, the parties hereto have executed this Award Agreement as of the day and
year first above written. By signing below, the Participant acknowledges that he/she has read,
understood and accepted all of the terms, conditions and restrictions of this Award Agreement.

	 	 	 
	PARTICIPANT	 	3COM CORPORATION
	 
	 	 
	 

	 	 
	Eileen Nelson

Senior Vice President, Human Relations

	 	Neal D. Goldman

Executive Vice President and Chief Legal and

Administrative Officer
	 
	 	 
	 

	 	 
	Date

	 	Date

8Exhibit 4.1

Exhibit 4.1

Loan Agreement dated July 1, 2008 between Badger Meter, Inc. and the M&I Marshall & Ilsley Bank

relating to Badger Meter, Inc.’s business note.

M&I MARSHALL & ILSLEY BANK

PROMISSORY NOTE

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Principal	 	Loan Date	 	Maturity	 	Loan No.	 	Call / Coll	 	Account	 	Officer	 	Initials
	$15,000,000.00

	 	07-01-2008
	 	06-30-2010	 	 	 	 	 	 	 	 	 	 

References in the shaded area are for Lender’s use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing “***” has been omitted due to text length limitations.

	 	 	 	 	 	 	 
	Borrower:

	 	Badger Meter, Inc.
	 	Lender:
	 	M&I Marshall & Ilsley Bank
	 

	 	4545 W. Brown Deer Rd.
	 	 	 	SE Wisconsin Region Commercial Lending
	 

	 	Milwaukee, WI 53223-2413
	 	 	 	770 North Water Street
	 

	 	 	 	 	 	Milwaukee, WI 53202

					
	Principal Amount: $15,000,000.00
	 	Initial Rate: 5.040%
	 	Date of Note: July 1, 2008

PROMISE TO PAY. Badger Meter, Inc. (“Borrower”) promises to pay to M&I Marshall & Ilsley Bank
(“Lender”), or order, in lawful money of the United States of America, the principal amount of
Fifteen Million & 00/100 Dollars ($15,000,000.00) together with interest at the rate of 5.040% per
annum on the unpaid principal balance from July 1, 2008, until paid in full. The interest rate may
change under the terms and conditions of the “INTEREST AFTER DEFAULT” section.

PAYMENT. Borrower will pay this loan in 24 regular payments of $658,783.65 each payment.
Borrower’s first payment will be due July 31, 2008, and will be for all principal and all accrued
interest not yet paid. Payments include principal and interest. Unless otherwise agreed or
required by applicable law, payments will be applied to Accrued Interest, Principal, Late Charges,
and Escrow. The annual interest rate for this Note is computed on a 365/360 basis; that is, by
applying the ratio of the annual interest rate over a year of 360 days, multiplied by the
outstanding principal balance, multiplied by the actual number of days the principal balance is
outstanding. Borrower will pay Lender at Lender’s address shown above or at such other place as
Lender may designate in writing.

PREPAYMENT PENALTY. Upon prepayment of this Note, Lender is entitled to the following prepayment
penalty: The Yield Maintenance Fee, as hereinafter provided, shall be immediately due and payable
by Maker upon a full or partial prepayment of this Note at any time prior to the final scheduled
payment due date on the Note.

Yield Maintenance Fee: “Yield Maintenance Fee” means an amount equal to the excess, if any, of the
amount of:

(i) monthly interest which would otherwise be payable on the prepaid principal amount of this Note
from the date of prepayment through the final scheduled payment due date on the Note, over the

(ii) monthly interest Lender would earn if the prepaid principal amount were reinvested for the
period from the date of prepayment through the final scheduled payment due date on the Note, at the
Reinvestment Rate (as hereinafter defined) plus 1.25%,

Such difference shall be discounted to present value at the Reinvestment Rate.

Reinvestment Rate:

If the remaining term of the Note is less than one year, “Reinvestment Rate” means: the yield in
percent per annum on Eurodollar Deposits (London) as of the Reinvestment Rate Determination Date
(as hereinafter defined) which has a maturity equal to the remaining term of the Note;

If the remaining term of the Note is one year or more, “Reinvestment Rate” means: the yield in
percent per annum on Interest Rate Swaps as of the Reinvestment Rate Determination Date which has a
maturity equal to the remaining term of the Note; or,

In the event there is no rate available for a term that is equal to the remaining term of the Note,
“Reinvestment Rate” means: the linear interpolation between the two rates (Eurodollar Deposits
and/or Interest Rate Swaps, as applicable), one for the closest maturity less than the remaining
term of the Note, and the other for the closest maturity greater than the remaining term of the
Note.

Reinvestment Rate Determination Date: “Reinvestment Rate Determination Date” means the date which
is five (5) banking days prior to the scheduled prepayment date.

Published yields: Yields on Eurodollar Deposits (London) and Interest Rate Swaps shall
be the applicable rates available and published most recently by the Board of Governors
of the Federal Reserve System as of such Reinvestment Rate Determination Date.
(Release H.15, available a www.federalreserve.gov/releases/h15/update)

Prepayment calculation notice to Borrower: Following the notice of prepayment from the Maker
described above, Lender shall promptly notify

Borrower of the amount and the basis of determination of the required Yield Maintenance Fee, and
such determination and amount shall be binding on both parties absent manifest error. Except for
the foregoing, Borrower may pay all or a portion of the amount owed earlier than it is due. Early
payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s obligation
to continue to make payments under the payment schedule. Rather, early payments will reduce the
principal balance due and may result in Borrower’s making fewer payments. Borrower agrees not to
send Lender payments marked “paid in full”, “without recourse”, or similar language. If Borrower
sends such a payment, Lender may accept it without losing any of Lender’s rights under this Note,
and Borrower will remain obligated to pay any further amount owed to Lender. All written
communications concerning disputed amounts, including any check or other payment instrument that
indicates that the payment constitutes “payment in full” of the amount owed or that is tendered
with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or
delivered to: M&I Marshall & Ilsley Bank, P.O. 3114 Milwaukee, WI 53201-3114.

LATE CHARGE. If a payment is not made on or before the10th day after it is due, Borrower will be
charged 5.000% of the unpaid portion of the regularly scheduled payment.

INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest
rate on this Note shall be increased by 3.000 percentage points. The interest rate will not exceed
the maximum rate permitted by applicable law.

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PROMISSORY NOTE

(Continued)

			
	Loan No:
	 	Page 2

DEFAULT. Each of the following shall constitute an event of default (“Event of Default”) under this Note:

	 	 	Payment Default. Borrower fails to make any payment when due under this Note.
	 
	 	 	Other Defaults. Borrower fails to comply with or to perform any other term, obligation,
covenant or condition contained in this Note or in any of the related documents or to comply
with or to perform any term, obligation, covenant or condition contained in any other agreement
between Lender and Borrower.
	 
	 	 	Default in Favor of Third Parties. Borrower or any Grantor defaults under any loan, extension
of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of
any other creditor or person that may materially affect any of Borrower’s property or Borrower’s
ability to repay this Note or perform Borrower’s obligations under this Note or any of the
related documents.
	 
	 	 	False Statements. Any warranty, representation or statement made or furnished to Lender by
Borrower or on Borrower’s behalf under this Note or the related documents is false or misleading
in any material respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.
	 
	 	 	Insolvency. The dissolution or termination of Borrower’s existence as a going business, the
insolvency of Borrower, the appointment of a receiver for any part of Borrower’s property, any
assignment for the benefit of creditors, any type of creditor workout, or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against Borrower.
	 
	 	 	Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings,
whether by judicial proceeding, self-help, repossession or any other method, by any creditor of
Borrower or by any government agency against any collateral securing the loan. This includes a
garnishment of any of Borrower’s accounts, including deposit accounts, with Lender. However,
this Event of Default shall not apply if there is a good faith dispute by Borrower as to the
validity or reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding
and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in
an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for
the dispute.
	 
	 	 	Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor,
endorser, surety, or accommodation party of any of the indebtedness or any guarantor, endorser,
surety, or accommodation party dies or becomes incompetent, or revokes or disputes the validity
of, or liability under, any guaranty of the indebtedness evidenced by this Note.
	 
	 	 	Change in Ownership. Any change in ownership of twenty-five percent (25%) or more of the common
stock of Borrower.
	 
	 	 	Adverse Change. A material adverse change occurs in Borrower’s financial condition, or Lender
believes the prospect of payment or performance of this Note is impaired.
	 
	 	 	Insecurity. Lender in good faith believes itself insecure.

LENDER’S RIGHTS. Upon default, Lender may declare the entire unpaid principal balance on this Note
and all accrued unpaid interest immediately due, and then Borrower will pay that amount.

ATTORNEY’S FEES; EXPENSES. Lender may hire or pay someone else to help collect this Note if
Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits
under applicable law, Lender’s attorney’s fees and Lender’s legal expenses, whether or not there is
a lawsuit, including attorney’s fees, expenses for bankruptcy proceedings (including efforts to
modify or vacate any automatic stay or injunction), and appeals. If not prohibited by applicable
law, Borrower also will pay any court costs, in addition to all other sums provided by law.

JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action,
proceeding, or counterclaim brought by either Lender or Borrower against the other.

GOVERNING LAW. This Note will be governed by federal law applicable to Lender and, to the extent
not preempted by federal law, the laws of the State of Wisconsin without regard to its conflicts of
law provisions. This Note has been accepted by Lender in the State of Wisconsin.

CHOICE OF VENUE. If there is a lawsuit, Borrower agrees upon Lender’s request to submit to the
jurisdiction of the courts of Milwaukee County, State of Wisconsin.

DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $15.00 if Borrower makes a payment on
Borrower’s loan and the check or preauthorized charge with which Borrower pays is later dishonored.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in
all Borrower’s accounts with Lender (whether checking, savings, or some other account). This
includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open
in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for
which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the debt
against any and all such accounts, and, at Lender’s option, to administratively freeze all such
accounts to allow Lender to protect Lender’s charge and setoff rights provided in this paragraph.

HEDGING INSTRUMENTS. Obligations and Indebtedness includes, without limitation all obligations,
indebtedness and liabilities arising pursuant to or in connection with any interest rate swap
transaction, basis swap, forward rate transaction, interest rate option, price risk hedging
transaction or any similar transaction between the Borrower and Lender.

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower’s
heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender
and its successors and assigns.

GENERAL PROVISIONS. This Note benefits Lender and its successors and assigns, and binds Borrower
and Borrower’s heirs, successors, assigns, and representatives. If any part of this Note cannot be
enforced, this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any
of its rights or remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand
for payment, and notice of dishonor. Upon any change in the terms of this Note, and unless
otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability. All such parties agree that
Lender may renew or extend (repeatedly and for any length of time) this loan or release any party
or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s security interest
in the collateral; and take any other action deemed necessary by Lender without the consent of or
notice to anyone. All such parties also agree that Lender may modify this loan without the consent
of or notice to anyone other than the party with whom the modification is made. The obligations
under this Note are joint and several.

2

 

PROMISSORY NOTE

(Continued)

			
	Loan No:
	 	Page 3

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE. BORROWER
AGREES TO THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.

BORROWER:

BADGER METER, INC.

	 	 	 	 	 
	By:

	 	/s/ Richard A. Meeusen
 

Chairman, President and Chief Executive Officer
	 	 
	 
	 	 	 	 
	By:

	 	/s/ Richard E. Johnson
 

Senior Vice President — Finance, Chief Financial Officer and Treasurer
	 	 

3

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