Second Amended and Restated Note Purchase and Private Shelf Agreement dated as of September 9, 20

Reference is made to that certain Second Amended and Restated Note Purchase and Private Shelf Agreement dated as of September 9, 2004 (the “Note Agreement”), by and among Franklin Electric Co., Inc., an Indiana corporation (the “Company”), Prudential Investment Management, Inc. (“PIM”), The Prudential Insurance Company of America (“PICA” and together with PIM, “Prudential”) and each other Prudential Affiliate which becomes a party thereto in accordance with the terms thereof. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Agreement.

Pursuant to the request of the Company and in accordance with the provisions of paragraph 11C of the Note Agreement, the parties hereto agree as follows:

SECTION 1.   Amendment . From and after the Effective Date (as defined in Section 3 hereof), the Note Agreement is amended as follows:

1.1   The cover page to the Note Agreement, paragraph 1A and paragraph 1B of the Note Agreement are each hereby amended to delete in its entirety each occurrence of the amount “$110,000,000” appearing therein and to substitute therefor the amount “$175,000,000”.

1.2   The first sentence of paragraph 2A(2) of the Note Agreement is amended to delete in its entirety clause (i) thereof and to substitute therefor the following: "(i) April 9, 2010 (or if such date is not a Business Day, the Business Day next preceding such date) and".

1.3   The Company and Prudential expressly agree and acknowledge that as of the date hereof, after giving effect to the issuance of the “Series B Notes” in the aggregate principal amount of $150,000,000 (as such Notes are described in the Confirmation of Acceptance dated as of even date herewith), the Available Facility Amount is $25,000,000. NOTWITHSTANDING THE FOREGOING, THIS AMENDMENT AND THE NOTE AGREEMENT HAVE BEEN ENTERED INTO ON THE EXPRESS UNDERSTANDING THAT NEITHER PRUDENTIAL NOR ANY PRUDENTIAL AFFILIATE SHALL BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE SHELF NOTES, OR TO QUOTE RATES, SPREADS OR OTHER TERMS WITH RESPECT TO SPECIFIC PURCHASES OF PRIVATE SHELF NOTES, AND THE FACILITY SHALL IN NO WAY BE CONSTRUED AS A COMMITMENT BY PRUDENTIAL OR ANY PRUDENTIAL AFFILIATE.

1.4   Paragraph 5G of the Note Agreement is amended and restated in its entirety as follows:

“5G .   Leverage Fee. In addition to interest accruing on the Notes, the Company agrees to pay to the holders of the Notes a fee (the “Leverage Fee” ) with respect to each Fiscal Quarter, beginning with the Fiscal Quarter ending June 30, 2007, during which at any time the ratio of Consolidated Total Debt as of the end of such Fiscal Quarter to EBITDA for the period of four fiscal quarters then ended is equal to or greater than 2.00 to 1.00. The Leverage Fee payable with respect to each Note shall be a dollar amount equal to (a) the product obtained by multiplying (i) the Applicable Number (as defined below) for such Fiscal Quarter times (ii) the Weighted Dollar Average (as defined below) of the principal balance of such Note during the Fiscal Quarter to which the Leverage Fee relates and (b) dividing the product thus obtained by four. The Leverage Fee for each applicable Fiscal Quarter shall be payable in arrears on the date upon which the financial statements for such Fiscal Quarter are to be delivered under paragraph 5A(i) (or paragraph 5A(ii), if the applicable Fiscal Quarter is the last Fiscal Quarter in a fiscal year). If the Company fails to deliver financial statements under paragraphs 5A(i) or 5A(ii) for any Fiscal Quarter or fiscal year by the date such delivery is due, then the Company shall be deemed to owe the Leverage Fee for such Fiscal Quarter (based on an Applicable Number of .0015) and shall make the payment required for such Fiscal Quarter on the date due pursuant to the preceding sentence. Payment of the Leverage Fee shall be made pursuant to the terms of paragraph 11A.

The acceptance of the Leverage Fee by any holder of a Note shall not constitute a waiver of any Default or Event of Default. The consequences for the failure to pay the Leverage Fee when due shall be governed by paragraph 7A(ii) hereof, treating the Leverage Fee, for such purposes and for the purpose of determining the amount payable upon acceleration of the Notes, as interest.

As used in this paragraph 5G, (a) “Applicable Number” shall mean (i) .00075 if, with respect to such Fiscal Quarter, the ratio of Consolidated Total Debt to EBITDA, as calculated above, was equal to or greater than 2.00 to 1.00, but not greater than 2.50 to 1.00 or (ii) .0015 if, with respect to such Fiscal Quarter, the ratio of Consolidated Total Debt to EBITDA, as calculated above, was greater than 2.50 to 1.00 and (b) “Weighted Dollar Average” shall mean, with respect to any Note, during any Fiscal Quarter, a dollar amount determined by adding together the daily outstanding principal balance of such Note during such Fiscal Quarter and dividing the amount thus obtained by the total number of days in such Fiscal Quarter.”

1.5   Paragraph 6 of the Note Agreement is amended by inserting the following new paragraph 6B(13) immediately after paragraph 6B(12):

“ 6B(13). Terrorism Sanction Regulations. The Company will not, and will not permit any Subsidiary, to (i) become a Person described or designated in the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order or (ii) engage in any dealings or transactions with any such Person.”

1.6   Paragraph 8 of the Note Agreement is amended by inserting the following new paragraph 8P immediately after paragraph 8O:

“ 8P.   Foreign Assets Control Regulations, Etc. (i) (a)   Neither the sale of the Notes by the Company hereunder nor its use of the proceeds thereof will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto.

(ii)   Neither the Company nor any Subsidiary (a) is a Person described or designated in the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order or (b) engages in any dealings or transactions with any such Person. The Company and its Subsidiaries are in compliance, in all material respects, with the USA Patriot Act.

(iii)   No part of the proceeds from the sale of the Notes hereunder will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended, assuming in all cases that such Act applies to the Company.”

1.7   Paragraph 10B of the Note Agreement is amended by adding the following definition in appropriate alphabetical order:

“ USA Patriot Act ” shall mean United States Public Law 107-56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

1.8   Exhibit D and Schedules 8A and 8G to the Note Agreement are hereby respectively amended and restated in their entirety in the form of Exhibit D and Schedules 8A and 8G attached hereto.

SECTION 2.   Representations and Warranties . The Company represents and warrants that, after giving effect hereto, each representation and warranty set forth in paragraph 8 of the Note Agreement, as amended hereby, is true on and as of the date of the execution and delivery of this letter by the Company with the same effect as if made on such date (except to the extent of changes caused by transactions contemplated under and permitted by the Note Agreement, as amended hereby).

SECTION 3 . Condition Precedent; Binding Agreement . This letter shall become effective as of the date hereof (the “Effective Date”) upon the return by the Company to Prudential Capital Group (Attention: Wiley S. Adams) of an original counterpart to this letter, duly executed and delivered by the Company, PIM and PICA. When this letter is so executed and delivered by the Company and has been signed by PIM and PICA, it shall become a binding agreement among the Company, PIM and PICA.

SECTION 4 .   Reference to and Effect on 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 letter. Except as specifically set forth in Section 1 hereof, the Note Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.  

SECTION 5. Governing Law .   THIS LETTER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF ILLINOIS (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE THIS LETTER 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 6. Counterparts; 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. 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. Delivery of an executed counterpart of a signature page to this letter by facsimile shall be effective as delivery of a manually executed counterpart of this letter.

Very truly yours,

PRUDENTIAL INVESTMENT MANAGEMENT, INC.

By:       

Vice-President

THE PRUDENTIAL INSURANCE COMPANY

OF AMERICA

By: ___________________________________

Vice President

Agreed and accepted:

Ladies and Gentlemen:

We have acted as special counsel to Franklin Electric Co., Inc., an Indiana corporation (the “Company”), in connection with the Second Amended and Restated Note Purchase and Private Shelf Agreement (the “Agreement”) dated as of September 9, 2004, among the Company, Prudential Investment Management, Inc., The Prudential Insurance Company of America and each other Prudential Affiliate which becomes a party thereto, as amended by the Amendment and PruShelf Renewal and Extension dated as of April 9, 2007 (the “Letter Agreement”), providing for the issuance and delivery to you today of the Company’s ______________ Note(s) due _______, ____ (the “Notes”). This opinion letter is being delivered at the request of the Company pursuant to paragraph 3A of the Agreement. Capitalized terms used in this opinion letter that are defined in the Agreement and not otherwise defined in this opinion letter shall have the meanings given to them in the Agreement. The term “person” when used herein shall mean any individual or entity.

In connection with this opinion letter, we have examined the following documents (the documents described in (i) and (ii) below are collectively called the “Transaction Documents”):

(i)   an executed copy of each of the Agreement and the Letter Agreement;

(